Document:

tndm-ex101_7.htm

Exhibit 10.1

EXECUTION VERSION

TANDEM DIABETES CARE, INC.

(a Delaware corporation)

3,508,770 Shares of Common Stock

 

UNDERWRITING AGREEMENT

Dated:  August 3, 2018

 

			
	
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TANDEM DIABETES CARE, INC.

(a Delaware corporation)

3,508,770 Shares of Common Stock

 

UNDERWRITING AGREEMENT

August 3, 2018

Oppenheimer & Co. Inc.

as Representative of the several Underwriters

 

c/o Oppenheimer & Co. Inc.
85 Broad Street, 23rd Floor
New York, NY 10004

Ladies and Gentlemen:

Tandem Diabetes Care, Inc., a Delaware corporation (the "Company"), confirms its agreement with Oppenheimer & Co. Inc. ("Oppenheimer") and each of the other Underwriters named in Schedule A hereto (collectively, the "Underwriters," which term shall also include any underwriter substituted as hereinafter provided in Section 10 hereof), for whom Oppenheimer is acting as representative (in such capacity, the "Representative"), with respect to (i) the sale by the Company and the purchase by the Underwriters, acting severally and not jointly, of the respective numbers of shares of Common Stock, par value $0.001 per share, of the Company ("Common Stock") set forth in Schedule A hereto and (ii) the grant by the Company to the Underwriters, acting severally and not jointly, of the option described in Section 2(b) hereof to purchase all or any part of 526,315 additional shares of Common Stock.  The aforesaid 3,508,770 shares of Common Stock (the "Initial Securities") to be purchased by the Underwriters and all or any part of the 526,315 shares of Common Stock subject to the option described in Section 2(b) hereof (the "Option Securities") are herein called, collectively, the "Securities."

The Company understands that the Underwriters propose to make a public offering of the Securities as soon as the Representative deems advisable after this Agreement has been executed and delivered.

The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S‐3 (Filing No. 333-224460), covering the public offering and sale of certain securities, including the Securities, under the Securities Act of 1933, as amended (the "1933 Act"), and the rules and regulations of the Commission thereunder (the "1933 Act Regulations").  Such registration statement, as of any time, means such registration statement as amended by any post-effective amendments thereto to such time, including the exhibits and any schedules thereto at such time, the documents incorporated or deemed to be incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be a part thereof as of such time pursuant to Rule 430B under the 1933 Act Regulations ("Rule 430B"), is referred to herein as the "Registration Statement;" provided, however, that the "Registration Statement" without reference to a time means such registration statement as amended by any post-effective amendments thereto as of the time of the first contract of sale for the Securities, which time shall be considered the "new effective date" of such registration statement with respect to the Securities within the meaning of paragraph (f)(2) of Rule 430B, including the exhibits and schedules thereto as of such time, the documents incorporated or deemed incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act and the 

			
	
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documents otherwise deemed to be a part thereof as of such time pursuant to Rule 430B.  If the Company has filed an abbreviated registration statement to register additional Securities pursuant to Rule 462(b) under the 1993 Act Regulations (the "462(b) Registration Statement"), then any reference herein to the Registration Statement shall also be deemed to include such 462(b) Registration Statement.  Each preliminary prospectus used in connection with the offering of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as a "preliminary prospectus."  Promptly after execution and delivery of this Agreement, the Company will prepare and file a final prospectus relating to the Securities in accordance with the provisions of Rule 424(b) under the 1933 Act Regulations ("Rule 424(b)").  The final prospectus, in the form first furnished or made available to the Underwriters for use in connection with the offering of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as the "Prospectus."  For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (or any successor system)("EDGAR").  

As used in this Agreement:

"Applicable Time" means 7:45 A.M., New York City time, on August 3, 2018 or such other time as agreed by the Company and the Representative.

"General Disclosure Package" means any Issuer General Use Free Writing Prospectuses issued at or prior to the Applicable Time, the most recent preliminary prospectus (including any documents incorporated therein by reference) that is distributed to investors prior to the Applicable Time and the information included on Schedule B-1 hereto, all considered together.

"Issuer Free Writing Prospectus" means any "issuer free writing prospectus," as defined in Rule 433 of the 1933 Act Regulations ("Rule 433"), including without limitation any "free writing prospectus" (as defined in Rule 405 of the 1933 Act Regulations ("Rule 405")) relating to the Securities that is (i) required to be filed with the Commission by the Company, (ii) a "road show that is a written communication" within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Securities or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g).

"Issuer General Use Free Writing Prospectus" means any Issuer Free Writing Prospectus that is intended for general distribution to prospective investors (other than a "bona fide electronic road show," as defined in Rule 433), as evidenced by its being specified in Schedule B-2 hereto.

"Issuer Limited Use Free Writing Prospectus" means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.

"Testing-the-Waters Communication" means any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the 1933 Act.

"Written Testing-the-Waters Communication" means any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405.

			
	
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All references in this Agreement to financial statements and schedules and other information which is "contained," "included" or "stated" (or other references of like import) in the Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to include all such financial statements and schedules and other information incorporated or deemed incorporated by reference in the Registration Statement, any preliminary prospectus or the Prospectus, as the case may be, prior to the execution and delivery of this Agreement; and all references in this Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to include the filing of any document under the Securities Exchange Act of 1934, as amended (the "1934 Act"), incorporated or deemed to be incorporated by reference in the Registration Statement, such preliminary prospectus or the Prospectus, as the case may be, at or after the execution and delivery of this Agreement.

SECTION 1.Representations and Warranties.

(a)Representations and Warranties by the Company.  The Company represents and warrants to each Underwriter as of the date hereof, the Applicable Time and the Closing Time (as defined below) and any Date of Delivery (as defined below), and agrees with each Underwriter, as follows:

(i)Registration Statement and Prospectuses.  The Company meets the requirements for use of Form S-3 under the 1933 Act.  Each of the Registration Statement and any post-effective amendment thereto has become effective under the 1933 Act.  No stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the 1933 Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated by the Commission.  The Company has complied with each request (if any) from the Commission for additional information.

Each of the Registration Statement and any post-effective amendment thereto, at the time it became effective and at each deemed effective date with respect to the Underwriters pursuant to Rule 430B(f)(2) under the 1933 Act Regulations, complied in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations.  Each preliminary prospectus, the Prospectus and any amendment or supplement thereto, at the time each was filed with the Commission, complied in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations.  Each preliminary prospectus delivered by the Company to the Underwriters for use in connection with this offering and the Prospectus was or will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.    

The documents incorporated or deemed to be incorporated by reference in the Registration Statement and the Prospectus, when they became effective or at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects with the requirements of the 1934 Act and the rules and regulations of the Commission thereunder (the "1934 Act Regulations").

(ii)Accurate Disclosure.  Neither the Registration Statement nor any amendment thereto, at its effective time, at the Closing Time or at any Date of Delivery, contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.  As of the Applicable Time, none of (A) the General Disclosure Package and (B) any individual Issuer Limited Use Free Writing Prospectus, when considered together with the General Disclosure Package included, includes or will include an untrue statement of a material fact or omitted, omits 

			
	
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or will 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.  Neither the Prospectus nor any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time of any filing with the Commission pursuant to Rule 424(b), at the Closing Time or at any Date of Delivery, included, includes or will include an untrue statement of a material fact or omitted, omits or will 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.  The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, at the time the Registration Statement became effective or when such documents incorporated by reference were filed with the Commission, as the case may be, when read together with the other information in the Registration Statement, the General Disclosure Package or the Prospectus, as the case may be, did not and will not include 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.

The representations and warranties in this subsection shall not apply to statements in or omissions from the Registration Statement (or any amendment thereto), the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) or any Issuer Limited Use Free Writing Prospectus made in reliance upon and in conformity with written information furnished to the Company by any Underwriter through the Representative expressly for use therein.  For purposes of this Agreement, the only information so furnished shall be the statements relating to the concession under the heading "Underwriting—Discounts and Commissions" and under the heading "Underwriting—Price Stabilization," in each case contained in the Prospectus (collectively, the "Underwriter Information").

(iii)Issuer Free Writing Prospectuses.  No Issuer Free Writing Prospectus conflicts or will conflict with the information contained in the Registration Statement or the Prospectus, including any document incorporated by reference therein, and any preliminary or other prospectus deemed to be a part thereof that has not been superseded or modified.  

(iv)Testing-the-Waters Materials.  The Company (A) has not engaged in any Testing-the-Waters Communication and (B) has not authorized anyone to engage in Testing-the-Waters Communications.  The Company has not distributed any Written Testing-the-Waters Communications.

(v)Company Not Ineligible Issuer.  At the time of filing the Registration Statement and any post-effective amendment thereto, at the earliest time thereafter that the Company or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the 1933 Act Regulations) of the Securities and at the date hereof, the Company was not and is not an "ineligible issuer," as defined in Rule 405, without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an ineligible issuer.

(vi)Emerging Growth Company Status.  From the time of the initial filing of the Registration Statement with the Commission (or, if earlier, the first date on which the Company engaged directly or through any Person authorized to act on its behalf in any Testing-the-Waters Communication) through the date hereof, the Company has been and is an "emerging growth company," as defined in Section 2(a) of the 1933 Act (an "Emerging Growth Company").

(vii)Independent Accountants.  The accountants who certified the financial statements and supporting schedules included in the Registration Statement, the General Disclosure Package 

			
	
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and the Prospectus are independent public accountants as required by the 1933 Act, the 1933 Act Regulations, the 1934 Act, the 1934 Act Regulations and the Public Company Accounting Oversight Board.

(viii)Financial Statements.  The financial statements included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly, in all material respects, the financial position of the Company and its consolidated subsidiaries at the dates indicated and the statement of operations, stockholders’ equity and cash flows of the Company and its consolidated subsidiaries for the periods specified; said financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("GAAP") applied on a consistent basis throughout the periods involved except, in the case of unaudited, interim financial statements, subject to normal year-end audit adjustments.  The supporting schedules, if any, present fairly, in all material respects, the information required to be stated therein in accordance with GAAP.  The selected financial data and the summary financial information included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly the information shown therein and have been compiled on a basis consistent with that of the audited financial statements included therein.  Except as included therein, no historical or pro forma financial statements or supporting schedules are required to be included or incorporated by reference in the Registration Statement, the General Disclosure Package or the Prospectus under the 1933 Act or the 1933 Act Regulations.  All disclosures contained or incorporated by reference in the Registration Statement, the General Disclosure Package or the Prospectus regarding "non-GAAP financial measures" (as such term is defined by the rules and regulations of the Commission) comply with Regulation G of the 1934 Act and Item 10 of Regulation S-K of the 1933 Act, to the extent applicable.  The interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus fairly presents the information called for in all material respects and has been prepared in accordance with the Commission's rules and guidelines applicable thereto. 

(ix)No Material Adverse Change in Business.  Except as otherwise stated therein, since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, (A) there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a "Material Adverse Effect"), (B) there have been no transactions entered into by the Company or any of its subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its subsidiaries considered as one enterprise, and (C) there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock.

(x)Good Standing of the Company.  The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Delaware and has the corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.

			
	
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(xi)Subsidiaries.  The Company has no subsidiaries other than Tandem Diabetes Care Canada, Inc. (the “Subsidiary”). The Subsidiary is not a “significant subsidiary” of the Company (as such term is defined in Rule 1-02(w) of Regulation S-X promulgated by the Commission). 

(xii)Capitalization.  The authorized and outstanding shares of capital stock of the Company are as set forth in the Registration Statement, the General Disclosure Package and the Prospectus under the caption "Description of Capital Stock" (except for subsequent issuances, if any, (A) pursuant to this Agreement, (B) pursuant to reservations, agreements or employee benefit plans referred to in the Registration Statement, the General Disclosure Package and the Prospectus, or (C) pursuant to the exercise of convertible securities, warrants or options referred to in the Registration Statement, the General Disclosure Package and the Prospectus.  The outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid and non‐assessable.  None of the outstanding shares of capital stock of the Company were issued in violation of the preemptive or other similar rights of any securityholder of the Company.  

(xiii)Authorization of Agreement.  This Agreement has been duly authorized, executed and delivered by the Company.

(xiv)Authorization and Description of Securities.  The Securities to be purchased by the Underwriters from the Company have been duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, when issued and delivered by the Company pursuant to this Agreement against payment of the consideration set forth herein, will be validly issued and fully paid and non‐assessable; and the issuance of the Securities is not subject to the preemptive or other similar rights of any securityholder of the Company.  The Common Stock conforms in all material respects to all statements relating thereto contained in the Registration Statement, the General Disclosure Package and the Prospectus and such description conforms in all material respects to the rights set forth in the instruments defining the same.  No holder of Securities will be subject to personal liability solely by reason of being such a holder.

(xv)Registration Rights.  There are no persons with registration rights or other similar rights to have any securities registered for sale pursuant to the Registration Statement or otherwise registered for sale or sold by the Company under the 1933 Act pursuant to this Agreement, other than those rights that have been disclosed in the Registration Statement, the General Disclosure Package and the Prospectus and have been waived.

(xvi)Absence of Violations, Defaults and Conflicts.  Neither the Company nor any of its subsidiaries is (A) in violation of its charter, by-laws or similar organizational document, (B) in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any subsidiary is a party or by which it is bound or to which any of the properties or assets of the Company or any subsidiary is subject (collectively, "Agreements and Instruments"), except for such defaults that would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect, or (C) in violation of any law, statute, rule, regulation, judgment, order, writ or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other authority, body or agency having jurisdiction over the Company or any subsidiary or any of their respective properties, assets or operations (each, a "Governmental Entity"), except for such violations that would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities and the use of the proceeds from the 

			
	
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sale of the Securities as described therein under the caption "Use of Proceeds") and compliance by the Company with its obligations hereunder have been duly authorized by all necessary corporate action and do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any properties or assets of the Company or any subsidiary pursuant to, the Agreements and Instruments (except for such conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect), nor will such action result in any violation of (i) the provisions of the charter, by-laws or similar organizational document of the Company or any of its subsidiaries or (ii) any law, statute, rule, regulation, judgment, order, writ or decree of any Governmental Entity, except with respect to clause (ii), such violations as would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect.  As used herein, a "Repayment Event" means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries. 

(xvii)Absence of Labor Dispute.  No labor dispute with the employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is imminent, and the Company has no knowledge of any existing or imminent labor disturbance by the employees of any of its principal suppliers, manufacturers, customers or contractors, which, in either case, would reasonably be expected to result in a Material Adverse Effect.

(xviii)Absence of Proceedings.  Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity (including, without limitation, any action, suit, proceeding, inquiry or investigation before or brought by the Food and Drug Administration (the "FDA")) now pending or, to the knowledge of the Company, threatened, against or affecting the Company or any of its subsidiaries, which would reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect, or which would reasonably be expected to, singly or in the aggregate, materially and adversely affect its properties or assets or the consummation of the transactions contemplated in this Agreement or the performance by the Company of its obligations hereunder; and the aggregate of all pending legal or governmental proceedings to which the Company or any such subsidiary is a party or of which any of their respective properties or assets is the subject which are not described in the Registration Statement, the General Disclosure Package and the Prospectus, including ordinary routine litigation incidental to the business, would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect.

(xix)Accuracy of Exhibits.  There are no contracts or documents which are required by the 1933 Act or the 1933 Act Regulations to be described in the Registration Statement, the General Disclosure Package or the Prospectus or to be filed as exhibits to the Registration Statement which have not been so described and filed as required.

(xx)Absence of Further Requirements.  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any Governmental Entity is necessary or required for the performance by the Company of its obligations hereunder, in connection with the offering, issuance or sale of the Securities hereunder or the consummation of the transactions contemplated by this Agreement, except such as have been already obtained or as may be required under the 1933 Act, the 1933 Act Regulations, the rules of the Nasdaq Stock Market LLC or state securities laws.

			
	
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(xxi)Title to Property.  The Company and its subsidiaries have good and marketable title to all real property owned by them and good title to all personal properties owned by them, in each case, free and clear of all mortgages, pledges, liens, security interests, claims, restrictions or encumbrances of any kind except such as (A) are described in the Registration Statement, the General Disclosure Package and the Prospectus or (B) do not, singly or in the aggregate, materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company or any of its subsidiaries; and all of the leases and subleases material to the business of the Company and its subsidiaries, considered as one enterprise, and under which the Company or any of its subsidiaries holds properties described in the Registration Statement, the General Disclosure Package or the Prospectus, are in full force and effect, and neither the Company nor any subsidiary has received any notice of any material claim of any sort that has been asserted by anyone adverse to the rights of the Company or any subsidiary under any of the leases or subleases mentioned above, or affecting or questioning the rights of the Company or such subsidiary to the continued possession of the leased or subleased premises under any such lease or sublease.

(xxii)Possession of Intellectual Property.  Except as would not reasonably be expected to have a Material Adverse Effect, (A) the Company and its subsidiaries own all right, title and interest in or otherwise has the right to use all patents, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names, including applications for any of the foregoing, and other intellectual property rights (collectively, "Intellectual Property") that is necessary for, used or held for use in, or otherwise exploited in connection with, the conduct of the business now operated by them ("Company Intellectual Property"), and (B) to the Company’s knowledge, the Company is not infringing, misappropriating, diluting or otherwise violating the Intellectual Property of any third party. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus or as would not reasonably be expected to have a Material Adverse Effect, (A) no action, suit, claim, or other proceeding is pending, or to the Company’s knowledge, is threatened, alleging that the Company is infringing, misappropriating, diluting, or otherwise violating the Intellectual Property of any third party in any respect, (B) to the Company’s knowledge, no third party is infringing, misappropriating, diluting, or otherwise violating the Company Intellectual Property in any respect, (C) no action, suit, claim, or other proceeding is pending, or to the Company’s knowledge, threatened, challenging the validity, enforceability, scope, registration, ownership or use of any Company Intellectual Property that is necessary to its business (with the exception of office actions in connection with applications for the registration or issuance of such Intellectual Property), (D) to the Company’s knowledge, the Company is in compliance with the U.S. Patent and Trademark Office’s duty of candor and disclosure for patent applications within the Company Intellectual Property filed in the United States and have made no material misrepresentation in connection with such patent applications, and (E) the Company and its subsidiaries have taken reasonable measures to protect, maintain and safeguard the Company Intellectual Property, including the execution of appropriate nondisclosure and confidentiality agreements.

(xxiii)Intellectual Property Licenses.  All licenses for the use of the Intellectual Property described in the Registration Statement, the General Disclosure Package and the Prospectus are valid, binding upon, and enforceable by or against the Company and its subsidiaries and, to the knowledge of the Company, the other parties thereto, in accordance with the terms of each such license, except as may be limited by bankruptcy, insolvency or other similar laws. The Company and its subsidiaries have complied in all material respects with, and are not in breach and, except as would not be expected to have a Material Adverse Effect, have not received any written asserted 

			
	
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or threatened claim of breach of any Intellectual Property license, and the Company has no knowledge of any breach by any other person to any Intellectual Property license.

(xxiv)Possession of Licenses and Permits.  The Company and its subsidiaries possess such permits, licenses, approvals, consents and other authorizations (collectively, "Governmental Licenses") issued by the appropriate Governmental Entities necessary to conduct the business now operated by them, except where the failure so to possess would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect.  The Company and its subsidiaries are in compliance with the terms and conditions of all Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect.  All of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, result in a Material Adverse Effect.  Neither the Company nor any of its subsidiaries has received any written notice of either proceedings or facts that would reasonably be expected to result in proceedings that remain outstanding or unresolved, relating to the revocation or modification of any Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

(xxv)FDA Compliance.  Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, the Company and each of its subsidiaries (A) is and at all times has been in full compliance with all statutes, rules, regulations, or guidances applicable to the Company or any of its subsidiaries and the ownership, testing, development, manufacture, packaging, processing, use, distribution, marketing, labeling, promotion, sale, offer for sale, storage, import, export or disposal of any product manufactured or distributed by the Company or any of its subsidiaries ("Applicable Laws"), except as could not reasonably be expected to result in a Material Adverse Effect, (B) has not received any FDA Form 483 notice of adverse finding, warning letter, untitled letter or other correspondence or notice from the FDA or any other Governmental Entity alleging or asserting noncompliance with any Applicable Laws or any licenses, certificates, approvals, clearances, authorizations, permits and supplements or amendments thereto required by any such Applicable Laws ("Authorizations"), except, in the case of FDA Form 483 notices of adverse findings, singly or in the aggregate, as could not reasonably be expected to result in a Material Adverse Effect, (C) possesses all material Authorizations and such Authorizations are valid and in full force and effect and is not in violation of any term of any such Authorizations, (D) has not received notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any Governmental Entity or third party alleging that any product operation or activity is in violation of any Applicable Laws or Authorizations and has no knowledge that any such Governmental Entity or third party is considering any such claim, litigation, arbitration, action, suit, investigation or proceeding, (E) has not received notice that any Governmental Entity has taken, is taking or intends to take action to limit, suspend, modify or revoke any Authorizations and has no knowledge that any such Governmental Entity is considering such action and (F) has filed, obtained, maintained or submitted all material reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments as required by any Applicable Laws or Authorizations and that all such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were complete and correct in all material respects on the date filed (or were corrected or supplemented by a subsequent submission.

(xxvi)Clinical Studies.  The studies, tests and preclinical and clinical trials conducted by or on behalf of the Company ("Company Studies") were and, if still pending, are, in all material respects, being conducted in accordance with experimental protocols, procedures and controls 

			
	
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pursuant to accepted professional scientific standards and all Applicable Laws and Authorizations, including, without limitation, the Federal Food, Drug and Cosmetic Act and implementing regulations at 21 C.F.R. Parts 50, 54, 56, 58 and 812; except to the extent disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company is not aware of any other studies, tests or trials the results of which the Company believes reasonably call into question the Company Studies when viewed in the context in which such results are described and the clinical state of development; and the Company has not received any notices or correspondence from any Governmental Entity requiring the termination, suspension or material modification of any Company Studies.

(xxvii)Environmental Laws.  Except as described in the Registration Statement, the General Disclosure Package and the Prospectus or would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect, (A) neither the Company nor any of its subsidiaries is in violation of any federal, state, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent, decree or judgment, relating to pollution or protection of human health, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum or petroleum products, asbestos-containing materials or mold (collectively, "Hazardous Materials") or to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials (collectively, "Environmental Laws"), (B) the Company and its subsidiaries have all permits, authorizations and approvals required under any applicable Environmental Laws and are each in compliance with their requirements, (C) there are no pending or, to the knowledge of the Company, threatened administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigation or proceedings relating to any Environmental Law against the Company or any of its subsidiaries and (D) there are no events or circumstances that would reasonably be expected to form the basis of an order for clean-up or remediation, or an action, suit or proceeding by any private party or Governmental Entity, against or affecting the Company or any of its subsidiaries relating to Hazardous Materials or any Environmental Laws.

(xxviii)Compliance with Health Care Laws.  Except as would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect or except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, neither the Company, nor the Company’s business operations, is in violation of any Health Care Laws. For purposes of this Agreement, "Health Care Laws" means (A) all federal and state fraud and abuse laws, including, but not limited to, the federal Anti-Kickback Statute (42 U.S.C. §1320a-7(b)), the Stark Law (42 U.S.C. §1395nn and §1395(q)), the Anti-Inducement Law (42 U.S.C. § 1320a-7a(a)(5)), the civil False Claims Act (31 U.S.C. §3729 et seq.), the administrative False Claims Law (42 U.S.C. § 1320a-7b(a)), the exclusion laws (42 U.S.C. § 1320a-7), the civil monetary penalty laws (42 U.S.C. § 1320a-7a) and the regulations promulgated pursuant to such statutes, (B) the Health Insurance Portability and Accountability Act of 1996 (Pub. L. No. 104-191) and the Health Information Technology for Economic and Clinical Health Act of 2009, and the regulations promulgated thereunder and comparable state privacy and security laws, (C) Medicare (Title XVIII of the Social Security Act) and the regulations promulgated thereunder, (D) Medicaid (Title XIX of the Social Security Act) and the regulations promulgated thereunder, (E) the Federal Food, Drug, and Cosmetic Act (21 U.S.C. § 301 et seq.) and the regulations promulgated pursuant thereto, (F) quality, safety and accreditation standards and requirements of all applicable state laws or regulatory bodies and (G) any and all other applicable health care laws, regulations, manual 

			
	
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provisions, policies and administrative guidance, each of (A) through (G) as may be amended from time to time.  Except as would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect or except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company has not received notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any Governmental Entity alleging that any product, operation or activity is in violation of any applicable Health Care Law or permit and has no knowledge that any such Governmental Entity is considering any such claim, litigation, arbitration, action, suit, investigation or proceeding; and the Company has not received notice, either verbally or in writing, that any Governmental Entity has taken, is taking or intends to take action to limit, suspend, modify or revoke any permits and has no knowledge that any such Governmental Entity is considering such action, except for any of the foregoing that would not reasonably be expected to result in a Material Adverse Effect.

(xxix)Compliance with Occupational Laws.  The Company and each of its subsidiaries (A) is in compliance, in all material respects, with any and all applicable foreign, federal, state and local laws, rules, regulations, treaties, statutes and codes promulgated by any and all governmental authorities (including pursuant to the Occupational Health and Safety Act) relating to the protection of human health and safety in the workplace ("Occupational Laws"), (B) has received all material permits, licenses or other approvals required of it under applicable Occupational Laws to conduct its business as currently conducted and (C) is in compliance, in all material respects, with all terms and conditions of such permit, license or approval. No action, proceeding, revocation proceeding, writ, injunction or claim is pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries relating to Occupational Laws, and the Company does not have knowledge of any facts, circumstances or developments relating to its operations or cost accounting practices that could reasonably be expected to form the basis for or give rise to such actions, suits, investigations or proceedings.

(xxx)Compliance with ERISA. Other than as would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect and except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, (i) no "employee benefit plan" (as defined in Section 3(3) of ERISA), for which the Company would have any liability (whether absolute or contingent) (each a "Plan") has experienced a failure to satisfy the "minimum funding standard" (as defined in Section 302 of the Employee Retirement Income Security Act of 1974, as amended, ("ERISA") or Section 412 of the Internal Revenue Code of 1986, as amended from time to time (the "Code")), or other event of the kind described in Section 4043(c) of ERISA (other than events with respect to which the 30-day notice requirement under Section 4043 of ERISA has been waived) or any similar minimum funding failure event with respect to any Plan (other than a Plan that under applicable law is required to be funded by a trust or funding vehicle maintained exclusively by a governmental authority) that is maintained outside of the United States primarily for the benefit of persons substantially all of whom are nonresident aliens; (ii) there currently are no proceedings under Section 4042 of ERISA by the Pension Benefit Guaranty Corporation for the termination of, or the appointment of a trustee to administer, any Plan, nor are any such proceedings currently likely to occur; (iii) no Plan is, or is expected to be, in "at risk" status  (within the meaning of Section 303(i)(4) of ERISA or Section 430(i)(4) of the Code; (iv) each Plan is in compliance in all respects with applicable law, including, without limitation, ERISA and the Code; (v) other than in the ordinary course, neither the Company nor any trade or business, whether or not incorporated, that, together with the Company, would be deemed to be a "single employer" within the meaning of Section 4001(b)(1) of ERISA or Section 414(b), 414(c), 414(m) or 414(o) of the Code has incurred or reasonably expects to incur any liability with respect to any Plan (A) under Title IV of ERISA or (B) in respect of any post-employment health, medical or life insurance benefits for former, current or future employees of the Company, except as 

			
	
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required to avoid excise tax under Section 4980B of the Code and except, on a case by case basis, limited extensions of health insurance benefits (for a period of no more than 18 months post-employment) to former employees receiving severance payments from the Company; and (vi) each Plan that is intended to be qualified under Section 401(a) of the Code has been determined by the Internal Revenue Service to be so qualified or is in the process of being submitted to the Internal Revenue Service for approval or will be so submitted during the applicable remedial amendment period, and nothing has occurred, whether by action or by failure to act, which could cause the loss of such qualification. The Company is not, and has not been at any time during the last three years, a party to any collective bargaining agreement or other labor agreement with respect to employees of the Company. There are no pending, or, to the best of the Company’s knowledge, threatened, activities or proceedings by any labor union or similar entity to organize any employees of the Company other than as would not reasonably be expected to have a Material Adverse Effect. No labor dispute with or labor strike, work stoppage or other material labor disturbance by the employees of the Company exists or to the Company’s knowledge is imminent. 

(xxxi)Accounting Controls and Disclosure Controls.  The Company and each of its subsidiaries maintain effective internal control over financial reporting (as defined under Rule 13a‐15 and 15d‐15 under the 1934 Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; (D) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (E) the interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto.  Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, since the end of the Company’s most recent audited fiscal year, there has been (1) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (2) no change in the Company’s internal control over financial reporting that has materially and adversely affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over financial reporting.  The Company maintains an effective system of disclosure controls and procedures (as defined in Rule 13a‐15 and Rule 15d‐15 under the 1934 Act Regulations) that is designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure.

(xxxii)Compliance with the Sarbanes-Oxley Act.  There is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.

(xxxiii)Payment of Taxes.  All U.S. federal income tax returns of the Company and its subsidiaries required by law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, except for such taxes or assessments, if any, as are being contested in good faith or will be timely contested in good faith 

			
	
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and as to which adequate reserves have been provided. The Company and its subsidiaries have filed all other tax returns that are required to have been filed by them pursuant to applicable foreign, state, local or other law except insofar as the failure to file such returns would not reasonably be expected to result in a Material Adverse Effect, and have paid all taxes due pursuant to such returns or pursuant to any assessment received by the Company and its subsidiaries, except for such taxes, if any, as are being contested in good faith or will be timely contested in good faith and as to which adequate reserves have been established by the Company or as would not reasonably be expected to, singly or in the aggregate, have a Material Adverse Effect. The charges, accruals and reserves on the books of the Company in respect of any income and corporation tax liability for any years not finally determined are adequate to meet any assessments or re-assessments for additional income tax for any years not finally determined, except to the extent of any inadequacy that would not reasonably be expected to result in a Material Adverse Effect. 

(xxxiv)Insurance.  The Company and its subsidiaries carry or are entitled to the benefits of insurance, with financially sound and reputable insurers, in such amounts and covering such risks as is generally maintained by companies of established repute engaged in the same or similar business, and all such insurance is in full force and effect.  The Company has no reason to believe that it or any of its subsidiaries will not be able (A) to renew its existing insurance coverage as and when such policies expire or (B) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not reasonably be expected to result in a Material Adverse Effect.  Neither the Company nor any of its subsidiaries has been denied any insurance coverage which it has sought or for which it has applied in the prior two years. 

(xxxv)Investment Company Act.  The Company is not required, and upon the issuance and sale of the Securities as herein contemplated and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package and the Prospectus will not be required, to register as an "investment company" under the Investment Company Act of 1940, as amended (the "1940 Act").

(xxxvi)Absence of Manipulation.  Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate take, directly or indirectly, any action which is designed, or would be expected, to cause or result in, or which constitutes, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities or to result in a violation of Regulation M under the 1934 Act.

(xxxvii)Foreign Corrupt Practices Act.  None of the Company, any of its subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee, affiliate or other person acting on behalf of the Company or any of its subsidiaries is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the "FCPA"), including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any "foreign official" (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA and the Company and, to the knowledge of the Company, its affiliates have conducted their businesses in compliance with the FCPA and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.

			
	
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(xxxviii) Money Laundering Laws.  The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the "Money Laundering Laws"); and no action, suit or proceeding by or before any Governmental Entity involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.

(xxxix)OFAC.  None of the Company, any of its subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee, affiliate or representative of the Company or any of its subsidiaries is an individual or entity ("Person") currently the subject or target of any sanctions administered or enforced by the United States Government, including, without limitation, the U.S. Department of the Treasury’s Office of Foreign Assets Control ("OFAC"), the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, "Sanctions"), nor is the Company located, organized or resident in a country or territory that is the subject of Sanctions; and the Company will not directly or indirectly use the proceeds of the sale of the Securities, or lend, contribute or otherwise make available such proceeds to any subsidiaries, joint venture partners or other Person, to fund any activities of or business with any Person, or in any country or territory, that, at the time of such funding, is the subject of Sanctions or in any other manner that will result in a violation by any Person (including any Person participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions.

(xl)Lending Relationship.  Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company (i) does not have any material lending or other relationship with any bank or lending affiliate of any Underwriter and (ii) does not intend to use any of the proceeds from the sale of the Securities to repay any outstanding debt owed to any affiliate of any Underwriter.

(xli)Statistical and Market-Related Data.  Any statistical and market-related data included in the Registration Statement, the General Disclosure Package or the Prospectus are based on or derived from sources that the Company believes, after reasonable inquiry, to be reliable and accurate in all material respects and, to the extent required, the Company has obtained the written consent to the use of such data from such sources.

(xlii)Maintenance of Rating.  The Company has no debt securities or preferred stock that is rated by any "nationally recognized statistical rating agency" (as that term is defined in Section 3(a)(62) of the 1934 Act).

(xliii)Policies and Procedures.  The Company maintains written policies and procedures reasonably designed for the Company to remain in substantial compliance with the laws, rules and regulations applicable to it and its business activities.  

(xliv)Affiliated Broker-Dealers.  To the Company's knowledge, none of the Company’s officers or directors is affiliated with any broker-dealer that conducts business in the United States or Canada, except as set forth in the Registration Statement, General Disclosure Package or the Prospectus or otherwise disclosed in writing to the Representative.

 

			
	
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(b)Officer’s Certificates.  Any certificate signed by any officer of the Company delivered to the Representative or to counsel for the Underwriters shall be deemed a representation and warranty by the Company (and not by such officer in his or her personal capacity) to each Underwriter as to the matters covered thereby.

SECTION 2.Sale and Delivery to Underwriters; Closing.

(a)Initial Securities.  On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from the Company, at the price per share set forth in Schedule A, that number of Initial Securities set forth in Schedule A opposite the name of such Underwriter, plus any additional number of Initial Securities which such Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof, subject, in each case, to such adjustments among the Underwriters as the Representative in its sole discretion shall make to eliminate any sales or purchases of fractional shares.

(b)Option Securities.  In addition, on the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company hereby grant(s) an option to the Underwriters, severally and not jointly, to purchase up to an additional 526,315 shares of Common Stock, at the price per share for the Securities sold to the public set forth in Schedule A, less an amount per share equal to any dividends or distributions declared by the Company and payable on the Initial Securities but not payable on the Option Securities.  The option hereby granted may be exercised for 30 days after the date hereof and may be exercised in whole or in part at any time from time to time upon notice by the Representative to the Company setting forth the number of Option Securities as to which the several Underwriters are then exercising the option and the time and date of payment and delivery for such Option Securities.  Any such time and date of delivery (a "Date of Delivery") shall be determined by the Representative, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time.  If the option is exercised as to all or any portion of the Option Securities, each of the Underwriters, acting severally and not jointly, will purchase that proportion of the total number of Option Securities then being purchased which the number of Initial Securities set forth in Schedule A opposite the name of such Underwriter bears to the total number of Initial Securities, subject, in each case, to such adjustments as the Representative in its sole discretion shall make to eliminate any sales or purchases of fractional shares.

(c)Payment.  Payment of the purchase price for, and delivery of certificates for, the Initial Securities shall be made at the offices of Clifford Chance US LLP, 31 West 52nd Street, New York, New York, 10019 or at such other place as shall be agreed upon by the Representative and the Company, at 9:00 A.M. (New York City time) on the second (third, if the pricing occurs after 4:30 P.M. (New York City time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of Section 10), or such other time not later than ten business days after such date as shall be agreed upon by the Representative and the Company (such time and date of payment and delivery being herein called "Closing Time").

In addition, in the event that any or all of the Option Securities are purchased by the Underwriters, payment of the purchase price for, and delivery of certificates for, such Option Securities shall be made at the above‐mentioned offices, or at such other place as shall be agreed upon by the Representative and the Company, on each Date of Delivery as specified in the notice from the Representative to the Company.

Payment shall be made to the Company by wire transfer of immediately available funds to a bank account designated by the Company against delivery to the Representative for the respective accounts of the Underwriters of certificates for the Securities to be purchased by them.  It is understood that each 

			
	
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Underwriter has authorized the Representative, for its account, to accept delivery of, receipt for, and make payment of the purchase price for, the Initial Securities and the Option Securities, if any, which it has agreed to purchase.  The Representative, individually and not as a representative of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Initial Securities or the Option Securities, if any, to be purchased by any Underwriter whose funds have not been received by the Closing Time or the relevant Date of Delivery, as the case may be, but such payment shall not relieve such Underwriter from its obligations hereunder.

SECTION 3.Covenants of the Company.  The Company covenants with each Underwriter as follows:

(a)Compliance with Securities Regulations and Commission Requests.  The Company, subject to Section 3(b), will comply with the requirements of Rule 430B, and will notify the Representative as soon as practicable, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective or any amendment or supplement to the Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus, or any document incorporated by reference therein, or for additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any preliminary prospectus or the Prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(d) or 8(e) of the 1933 Act concerning the Registration Statement and (v) if the Company becomes the subject of a proceeding under Section 8A of the 1933 Act in connection with the offering of the Securities.  The Company will effect all filings required under Rule 424(b), in the manner and within the time period required by Rule 424(b) (without reliance on Rule 424(b)(8)), and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus.  The Company will use reasonable best efforts to prevent the issuance of any stop order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof as soon as practicable.  

(b)Continued Compliance with Securities Laws.  The Company will comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations so as to permit the completion of the distribution of the Securities as contemplated in this Agreement and in the Registration Statement, the General Disclosure Package and the Prospectus.  If at any time when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172 of the 1933 Act Regulations ("Rule 172"), would be) required by the 1933 Act to be delivered in connection with sales of the Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not include 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, (ii) amend or supplement the General Disclosure Package or the Prospectus in order that the General Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the General Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly (A) give the Representative notice of such event, (B) prepare any amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement, the General Disclosure Package or the Prospectus comply with such requirements and, a reasonable amount of time 

			
	
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prior to any proposed filing or use, furnish the Representative with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; provided that the Company shall not file or use any such amendment or supplement to which the Representative or counsel for the Underwriters shall reasonably object.  The Company will furnish to the Underwriters such number of copies of such amendment or supplement as the Underwriters may reasonably request.  The Company has given the Representative notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48 hours prior to the Applicable Time; the Company will give the Representative notice of its intention to make any such filing from the Applicable Time to the Closing Time and will furnish the Representative with copies of any such documents a reasonable amount of time prior to such proposed filing, as the case may be, and will not file or use any such document to which the Representative or counsel for the Underwriters shall reasonably object.

(c)Delivery of Registration Statements.  The Company has furnished or will deliver to the Representative and counsel for the Underwriters, without charge, signed copies of the Registration Statement as originally filed and each amendment thereto (including exhibits filed therewith or incorporated by reference therein and documents incorporated or deemed to be incorporated by reference therein) and signed copies of all consents and certificates of experts, and will also deliver to the Representative, without charge, a conformed copy of the Registration Statement as originally filed and each amendment thereto (without exhibits) for each of the Underwriters.  The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S‐T.

(d)Delivery of Prospectuses.  The Company has delivered to each Underwriter, without charge, as many copies of each preliminary prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the 1933 Act.  The Company will furnish to each Underwriter, without charge, during the period when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably request.  The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S‐T.

(e)Blue Sky Qualifications.  The Company will use its reasonable best efforts, in cooperation with the Underwriters, to qualify the Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representative may designate and to maintain such qualifications in effect so long as required to complete the distribution of the Securities; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

(f)Rule 158.  The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally available to its securityholders as soon as practicable an earnings statement for the purposes of, and to provide to the Underwriters the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.

(g)Use of Proceeds.  The Company will use the net proceeds received by it from the sale of the Securities in the manner specified in the Registration Statement, the General Disclosure Package and the Prospectus under "Use of Proceeds."

			
	
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(h)Listing.  The Company will use its best efforts to effect and maintain the listing of the Common Stock (including the Securities) on the Nasdaq Global Market.

(i)Restriction on Sale of Securities.  During a period of 90 days from the date of the Prospectus (the “Lock-Up Period”), the Company will not, without the prior written consent of the Representative, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for shares of Common Stock or file any registration statement under the 1933 Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of shares of Common Stock or such other securities, in cash or otherwise.  The foregoing sentence shall not apply to (A) the Securities to be sold hereunder, (B) any shares of Common Stock issued by the Company upon the exercise of options or warrants, or the conversion of other securities outstanding on the date hereof and referred to in the Registration Statement, the General Disclosure Package and the Prospectus, (C) any equity awards granted pursuant to employee benefit plans of the Company referred to in the Registration Statement, the General Disclosure Package and the Prospectus and (D) issuances of up to 2,500,000 shares of Common Stock, or any securities convertible, exercisable or exchangeable for Common Stock, issued by the Company in connection with the acquisition of businesses, technologies, assets or Intellectual Property of another entity, provided that, in each case, the Representative shall have received an agreement substantially in the form of Exhibit C hereto signed by the recipient of such securities.

(j)Reporting Requirements.  The Company, during the period when a Prospectus relating to the Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods required by the 1934 Act and 1934 Act Regulations.  

(k)Issuer Free Writing Prospectuses.  The Company agrees that, unless it obtains the prior written consent of the Representative, it will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a "free writing prospectus," or a portion thereof, required to be filed by the Company with the Commission or retained by the Company under Rule 433; provided that the Representative will be deemed to have consented to the Issuer Free Writing Prospectuses listed on Schedule B-2 hereto and any "road show that is a written communication" within the meaning of Rule 433(d)(8)(i) that has been reviewed by the Representative.  The Company represents that it has treated or agrees that it will treat each such free writing prospectus consented to, or deemed consented to, by the Representative as an "issuer free writing prospectus," as defined in Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely filing with the Commission where required, legending and record keeping.  If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, any preliminary prospectus or the Prospectus or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representative and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.

(l)Emerging Growth Company Status. The Company will promptly notify the Representative if the Company ceases to be an Emerging Growth Company at any time prior to the later of (i) completion 

			
	
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of the distribution of the Securities within the meaning of the 1933 Act and (ii) completion of the 90-day restricted period referred to in Section 3(i).

SECTION 4.Payment of Expenses.

(a)Expenses.  The Company will pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and each amendment thereto, (ii) the preparation, printing and delivery to the Underwriters of copies of each preliminary prospectus, each Issuer Free Writing Prospectus and the Prospectus and any amendments or supplements thereto and any costs associated with electronic delivery of any of the foregoing by the Underwriters to investors, (iii) the preparation, issuance and delivery of the certificates for the Securities to the Underwriters, including any stock or other transfer taxes and any stamp or other duties payable upon the sale, issuance or delivery of the Securities to the Underwriters, (iv) the fees and disbursements of the Company’s counsel, accountants and other advisors, (v) the qualification of the Securities under securities laws in accordance with the provisions of Section 3(e) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of the Blue Sky Survey and any supplement thereto, (vi) the fees and expenses of any transfer agent or registrar for the Securities, (vii) the costs and expenses of the Company relating to investor presentations on any "road show" undertaken in connection with the marketing of the Securities, including without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged by the Company in connection with the road show presentations, travel and lodging, and commercial airfare expenses of the representatives and officers of the Company and any such consultants, (viii) the reasonable and documented out-of-pocket costs and expenses incident to the performance of the obligations of the Underwriters in connection with the offering of the Securities (including, without limitation, the reasonable and documented fees and expenses of the Underwriters' outside attorneys, including legal fees described in clause (v) above, in an amount not to exceed $120,000 in the aggregate), (ix) any fees and expenses incurred in connection with the listing of the Securities on the Nasdaq Global Market, and (x) the costs and expenses (including, without limitation, any damages or other amounts payable in connection with legal or contractual liability) associated with the reforming of any contracts for sale of the Securities made by the Underwriters caused by a breach of the representation contained in the third sentence of Section 1(a)(ii).

(b)Termination of Agreement.  If this Agreement is terminated by the Representative in accordance with the provisions of Section 5, Section 9(a)(i) or (iii), or Section 10 hereof, the Company shall reimburse the non-defaulting Underwriters for all of their reasonable and documented out-of-pocket expenses, including the reasonable and documented fees and disbursements of counsel for the Underwriters.

SECTION 5.Conditions of Underwriters’ Obligations.  The obligations of the several Underwriters hereunder are subject to the accuracy of the representations and warranties of the Company contained herein or in certificates of any officer of the Company delivered pursuant to the provisions hereof, to the performance by the Company of its covenants and other obligations hereunder, and to the following further conditions:

(a)Effectiveness of Registration Statement.  The Registration Statement, including any Rule 462(b) Registration Statement, has become effective and, at the Closing Time, no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the 1933 Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated; and the Company has complied with each request (if any) 

			
	
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from the Commission for additional information to the reasonable satisfaction of counsel to the Company and counsel to the Underwriters.

(b)Opinion of Counsel for Company.  At the Closing Time, the Representative shall have received the favorable opinion, dated the Closing Time, of Stradling Yocca Carlson & Rauth, P.C., counsel for the Company, the form of which is attached as Exhibit A, together with signed or reproduced copies of such letter for each of the other Underwriters to the extent requested.

(c)Opinion of Special Patent Counsel for Company.  At the Closing Time, the Representative shall have received the favorable opinion, dated the Closing Time, of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., special patent counsel for the Company, the form of which is attached as Exhibit B, together with signed or reproduced copies of such letter for each of the other Underwriters to the extent requested.

(d)Opinion of Counsel for Underwriters.  At the Closing Time, the Representative shall have received the favorable opinion, dated the Closing Time, of Clifford Chance US LLP, counsel for the Underwriters, in form and substance satisfactory to the Representative, together with signed or reproduced copies of such letter for each of the other Underwriters to the extent requested.

(e)Officers’ Certificate.  At the Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any Material Adverse Effect, and the Representative shall have received a certificate of the Chief Executive Officer of the Company and of the Chief Financial or Chief Accounting Officer of the Company, dated the Closing Time, to the effect that (i) there has been no such Material Adverse Effect, (ii) the representations and warranties of the Company in this Agreement are true and correct with the same force and effect as though expressly made at and as of the Closing Time, (iii) the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to the Closing Time, and (iv) no stop order suspending the effectiveness of the Registration Statement under the 1933 Act has been issued, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to their knowledge, contemplated.

(f)Accountant’s Comfort Letter.  At the time of the execution of this Agreement, the Representative shall have received from Ernst & Young LLP a letter, dated such date, in form and substance satisfactory to the Representative, together with signed or reproduced copies of such letter for each of the other Underwriters 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, the General Disclosure Package and the Prospectus.

(g)Bring-down Comfort Letter.  At the Closing Time, the Representative shall have received from Ernst & Young LLP a letter, dated as of the Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (f) of this Section, except that the specified date referred to shall be a date not more than three business days prior to the Closing Time.

(h)Approval of Listing.  To the extent required by the rules of the Nasdaq Global Market, at the Closing Time, the Securities shall have been approved for listing on the Nasdaq Global Market, subject only to official notice of issuance.

(i)Lock-up Agreements.  At the date of this Agreement, the Representative shall have received an agreement substantially in the form of Exhibit C hereto signed by the persons listed on Schedule C hereto.

			
	
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(j)Conditions to Purchase of Option Securities.  In the event that the Underwriters exercise their option provided in Section 2(b) hereof to purchase all or any portion of the Option Securities, the representations and warranties of the Company contained herein and the statements in any certificates furnished by the Company hereunder shall be true and correct as of each Date of Delivery and, at the relevant Date of Delivery, the Representative shall have received:

(i)Officers' Certificate.  A certificate, dated such Date of Delivery, of the Chief Executive Officer of the Company and of the Chief Financial or Chief Accounting Officer of the Company, confirming that the certificate delivered at the Closing Time pursuant to Section 5(e) hereof remains true and correct as of such Date of Delivery.

(ii)Opinion of Counsel for Company.  If requested by the Representative, the favorable opinion of Stradling Yocca Carlson & Rauth, P.C., counsel for the Company, in form and substance reasonably satisfactory to counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(b) hereof.

(iii)Opinion of Special Patent Counsel for Company.  If requested by the Representative, the favorable opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., special patent counsel for the Company for the Company, in form and substance reasonably satisfactory to counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(c) hereof.

(iv)Opinion of Counsel for Underwriters.  If requested by the Representative, the favorable opinion of Clifford Chance US LLP, counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(d) hereof.

(v)Bring-down Comfort Letter.  If requested by the Representative, a letter from Ernst & Young LLP, in form and substance satisfactory to the Representative and dated such Date of Delivery, substantially in the same form and substance as the letter furnished to the Representative pursuant to Section 5(f) hereof, except that the "specified date" in the letter furnished pursuant to this paragraph shall be a date not more than three business days prior to such Date of Delivery.

(k)Additional Documents.  At the Closing Time and at each Date of Delivery (if any) counsel for the Underwriters shall have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Representative and counsel for the Underwriters. 

(l)Termination of Agreement.  If any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities on a Date of Delivery which is after the Closing Time, the obligations of the several Underwriters to purchase the relevant Option Securities, may be terminated by the Representative by notice to the Company at any time at or prior to Closing Time or such Date of Delivery, as the case may be, and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7, 8, 14, 15 and 16 shall survive any such termination and remain in full force and effect.

			
	
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SECTION 6.Indemnification.

(a)Indemnification of Underwriters.  The Company agrees to indemnify and hold harmless each Underwriter, its affiliates (as such term is defined in Rule 501(b) under the 1933 Act (each, an "Affiliate")), its selling agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

	
(i)
	
against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included (A) in any preliminary prospectus, any Issuer Free Writing Prospectus, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto), or (B) in any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Stock ("Marketing Materials"), including any roadshow or investor presentations made to investors by the Company (whether in person or electronically), or the omission or alleged omission in any preliminary prospectus, Issuer Free Writing Prospectus, Prospectus or in any Marketing Materials of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;

	
(ii)
	
against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company;

	
(iii)
	
against any and all expense whatsoever, as incurred (including the fees and disbursements of one counsel chosen by the Representative), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;

provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with the Underwriter Information.

	
(b)
	
Indemnification of Company, Directors and Officers.  Each Underwriter severally agrees to indemnify and hold harmless the Company, its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with the Underwriter Information.

			
	
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(c)
	
Actions against Parties; Notification.  Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement.  In the case of parties indemnified pursuant to Section 6(a) above, counsel to the indemnified parties shall be selected by the Representative, and, in the case of parties indemnified pursuant to Section 6(b) above, counsel to the indemnified parties shall be selected by the Company.  An indemnifying party may participate at its own expense in the defense of any such action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party.  In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances.  No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding 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)
	
Settlement without Consent if Failure to Reimburse.  If at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(ii) effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.

SECTION 7.Contribution.  If the indemnification provided for in Section 6 hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Underwriters, on the other hand, from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, on the one hand, and of the Underwriters, on the other hand, in connection with the statements or omissions, which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.

The relative benefits received by the Company, on the one hand, and the Underwriters, on the other hand, in connection with the offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the Company, on the one hand, and the total underwriting discount received by the Underwriters, on the other hand, in each case as set forth on the cover of the Prospectus, bear to the aggregate public offering price of the Securities as set forth on the cover of the Prospectus.

			
	
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The relative fault of the Company, on the one hand, and the Underwriters, on the other hand, shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7 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 7.  The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 7 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission.

Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the underwriting commissions received by such Underwriter in connection with the Securities underwritten by it and distributed to the public.

No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

For purposes of this Section 7, each person, if any, who controls an Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and each Underwriter’s Affiliates and selling agents shall have the same rights to contribution as such Underwriter, and each director of the Company, each officer of the Company who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company.  The Underwriters’ respective obligations to contribute pursuant to this Section 7 are several in proportion to the number of Initial Securities set forth opposite their respective names in Schedule A hereto and not joint.

SECTION 8.Representations, Warranties and Agreements to Survive.  All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or directors or any person controlling the Company and (ii) delivery of and payment for the Securities.

SECTION 9.Termination of Agreement.

(a)Termination.  The Representative may terminate this Agreement, by notice to the Company, at any time at or prior to the Closing Time (i) if there has been, in the judgment of the Representative, since the time of execution of this Agreement or since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any Material Adverse Effect, or (ii) if there has occurred any material adverse change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or act of terrorism or escalation thereof or other calamity or crisis or any change or development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representative, impracticable or inadvisable to proceed with the 

			
	
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completion of the offering or to enforce contracts for the sale of the Securities, or (iii) if trading in any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq Global Market, or (iv) if trading generally on the NYSE MKT LLC, the New York Stock Exchange or the Nasdaq Global Market has been suspended or materially limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges or by order of the Commission, FINRA or any other governmental authority, or (v) a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States or with respect to Clearstream or Euroclear systems in Europe, or (vi) if a banking moratorium has been declared by either Federal or New York authorities.

(b)Liabilities.  If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any party to any other party except as provided in Section 4 hereof, and provided, further, that Sections 1, 6, 7, 8, 14, 15 and 16 shall survive such termination and remain in full force and effect.

SECTION 10.Default by One or More of the Underwriters.  If one or more of the Underwriters shall fail at the Closing Time or a Date of Delivery to purchase the Securities which it or they are obligated to purchase under this Agreement (the "Defaulted Securities"), the Representative shall have the right, within 24 hours thereafter, to make arrangements for one or more of the non‐defaulting Underwriters, or any other underwriters reasonably satisfactory to the Company, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth; if, however, the Representative shall not have completed such arrangements within such 24‐hour period, then:

(i)if the number of Defaulted Securities does not exceed 10% of the number of Securities to be purchased on such date, each of the non‐defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all non‐defaulting Underwriters, or

(ii)if the number of Defaulted Securities exceeds 10% of the number of Securities to be purchased on such date, this Agreement or, with respect to any Date of Delivery which occurs after the Closing Time, the obligation of the Underwriters to purchase, and the Company to sell, the Option Securities to be purchased and sold on such Date of Delivery shall terminate without liability on the part of any non‐defaulting Underwriter.

No action taken pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default.

In the event of any such default which does not result in a termination of this Agreement or, in the case of a Date of Delivery which is after the Closing Time, which does not result in a termination of the obligation of the Underwriters to purchase and the Company to sell the relevant Option Securities, as the case may be, either the (i) Representative or (ii) the Company shall have the right to postpone Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any required changes in the Registration Statement, the General Disclosure Package or the Prospectus or in any other documents or arrangements.  As used herein, the term "Underwriter" includes any person substituted for an Underwriter under this Section 10. 

SECTION 11.Notices.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication.  Notices to the Underwriters shall be directed to the Representative at Oppenheimer & Co. Inc., 85 Broad Street, New York, New York 10004, Attention: Equity Capital Markets, with a copy to 

			
	
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Oppenheimer & Co. Inc., 85 Broad Street, New York, New York 10004, Attention: General Counsel; notices to the Company shall be directed to it at 11045 Roselle Street, San Diego, CA 92121, attention of General Counsel (facsimile:  (858) 362-7070).

SECTION 12.No Advisory or Fiduciary Relationship.  The Company acknowledges and agrees that (a) the purchase and sale of the Securities pursuant to this Agreement, including the determination of the public offering price of the Securities and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the several Underwriters, on the other hand, (b) in connection with the offering of the Securities and the process leading thereto, each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, any of its subsidiaries or their respective stockholders, creditors, employees or any other party, (c) no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering of the Securities or the process leading thereto (irrespective of whether such Underwriter has advised or is currently advising the Company or any of its subsidiaries on other matters) and no Underwriter has any obligation to the Company with respect to the offering of the Securities except the obligations expressly set forth in this Agreement, (d) the Underwriters and their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and (e) the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the offering of the Securities and the Company has consulted its own respective legal, accounting, regulatory and tax advisors to the extent it deemed appropriate. 

SECTION 13.Parties.  This Agreement shall each inure to the benefit of and be binding upon the Underwriters and the Company and their respective successors.  Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriters and the Company and their respective successors and the controlling persons and officers and directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained.  This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters and the Company and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation.  No purchaser of Securities from any Underwriter shall be deemed to be a successor by reason merely of such purchase.

SECTION 14.Trial by Jury.  The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) and each of the Underwriters hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

SECTION 15.GOVERNING LAW.  THIS AGREEMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF, THE STATE OF NEW YORK WITHOUT REGARD TO ITS CHOICE OF LAW PROVISIONS.

SECTION 16.Consent to Jurisdiction; Waiver of Immunity. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby ("Related Proceedings") shall be instituted in (i) the federal courts of the United States of America located in the City and County of New York, Borough of Manhattan or (ii) the courts of the State of New York located in the City and County of New York, Borough of Manhattan (collectively, the "Specified Courts"), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such court (a "Related Judgment"), as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding.  Service of any process, summons, notice 

			
	
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or document by mail to such party’s address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court.  The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient forum. 

SECTION 17.TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.

SECTION 18.Partial Unenforceability.  The invalidity or unenforceability of any Section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other Section, paragraph or provision hereof.  If any Section, paragraph or provisions of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.

SECTION 19.Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

SECTION 20.Effect of Headings.  The Section headings herein are for convenience only and shall not affect the construction hereof.

SECTION 21.Entire Agreement.  This Agreement supersedes all prior agreements and understanding (whether written or oral) between the Company and the Underwriters, or any of them, with respect to the subject matter hereof.

[Remainder of the page intentionally left blank; signature pages follow]

 

			
	
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If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the Underwriters and the Company in accordance with its terms.

Very truly yours,

TANDEM DIABETES CARE, INC.

	
 
	
By
	
  /s/ Kim Blickenstaff
Title:  President & CEO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to Underwriting Agreement]

			
	
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CONFIRMED AND ACCEPTED,
as of the date first above written:

OPPENHEIMER & CO. INC.

 

By  /s/ Eric Helenek

Authorized Signatory

For itself and as Representative of the other Underwriters named in Schedule A hereto.

 

 

[Signature Page to Underwriting Agreement]

			
	
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SCHEDULE A

The public offering price per share for the Securities shall be $28.50.

The purchase price per share for the Securities sold to the public to be paid by the several Underwriters shall be $27.075, being an amount equal to the public offering price set forth above less $1.425 per share, subject to adjustment in accordance with Section 2(b) for dividends or distributions declared by the Company and payable on the Initial Securities but not payable on the Option Securities.

 

		
	
Name of Underwriter
	
Number of
Initial Securities

	
 
	
 

	
Oppenheimer & Co. Inc.

Robert W. Baird & Co. Incorporated......................................................
	
3,157,893

           350,877

	
 
	
 

	
 
	
 

	
Total
	
3,508,770

 

 

			
	
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SCHEDULE B-1

Pricing Terms

	
 
	
1.
	
The Company is selling 3,508,770 shares of Common Stock.

	
2.
	
The Company has granted an option to the Underwriters, severally and not jointly, to purchase up to an additional 526,315 shares of Common Stock.

	
3.
	
The public offering price per share for the Securities shall be $28.50.

 

			
	
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SCHEDULE B-2

Free Writing Prospectuses

	
1.
	
None.

			
	
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SCHEDULE C

List of Persons and Entities Subject to Lock-up

	
 
	
1.
	
Delphi BioInvestments VIII, L.P.

	
 
	
2.
	
Delphi Ventures VIII, L.P.

	
 
	
3.
	
HLM Venture Partners II, L.P.

	
 
	
4.
	
Dick P. Allen

	
 
	
5.
	
Edward L. Cahill 

	
 
	
6.
	
Kim D. Blickenstaff

	
 
	
7.
	
Howard E. Greene, Jr.

	
 
	
8.
	
Douglas A. Roeder

	
 
	
9.
	
Fred E. Cohen

	
 
	
10.
	
Christopher J. Twomey 

	
 
	
11.
	
Richard P. Valencia

	
 
	
12.
	
Susan M. Morrison

	
 
	
13.
	
John F. Sheridan

	
 
	
14.
	
David B. Berger

	
 
	
15.
	
Leigh Vosseller

	
 
	
16.
	
Brian B. Hansen

 

 

			
	
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Exhibit A

FORM OF OPINION OF COMPANY’S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)

1.The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware.  The Company is duly qualified to do business as a foreign corporation and is in good standing in each other state in which the nature of its activities or of its properties owned or leased makes such qualification necessary, except to the extent that failure to so qualify would not have a Material Adverse Effect.  The Company has the corporate power and authority to own, lease and operate its properties and assets and to carry on its business as described in the Registration Statement, the General Disclosure Package and the Prospectus.  

2.The Company has an authorized and issued and outstanding capitalization as set forth in the Registration Statement, the General Disclosure Package and the Prospectus under the caption "Description of Capital Stock" (except for subsequent issuances, if any, pursuant to the Underwriting Agreement or pursuant to reservations, agreements or employee benefit plans referred to in the Registration Statement, the General Disclosure Package and the Prospectus or pursuant to the exercise of warrants, options or other convertible securities referred to in the Registration Statement, the General Disclosure Package and the Prospectus), and none of the outstanding shares of capital stock of the Company were issued in violation of the preemptive or other similar rights of any securityholder of the Company.  All of the shares of capital stock of the Company outstanding immediately prior to the consummation of the transactions contemplated by the Underwriting Agreement have been duly authorized and validly issued and are fully paid and nonassessable.    

3.The Securities have been duly authorized and, when duly countersigned by the Company’s transfer agent and registrar and issued, delivered and paid for in accordance with the provisions of the Registration Statement, the Prospectus and the Underwriting Agreement, will be validly issued, fully paid and nonassessable.  The form of certificate used to evidence the Securities complies as to form with any applicable requirements of the Company's Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, as currently in effect, the applicable provisions of the Delaware General Corporation Law, and the applicable rules of the Nasdaq Global Market.

4.Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there is, to our current actual knowledge, no action, suit or proceeding pending or threatened against the Company or its properties or assets in any court or before any Governmental Entity (a) which seeks to restrain, enjoin, prevent the consummation of, or otherwise challenge the Underwriting Agreement or any of the transactions contemplated thereby, or (b) which, if adversely determined, could reasonably be expected to have a Material Adverse Effect.

5.The Company has full corporate power and authority to enter into the Underwriting Agreement and perform its obligations thereunder.  The Underwriting Agreement has been duly authorized by all necessary corporate action on the part of the Company and has been duly executed and delivered by the Company.  

6.The execution, delivery and performance of the Underwriting Agreement by the Company and the consummation of the transactions contemplated thereby and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities and the use of the net proceeds from the sale of the Securities as described in the Prospectus under the caption "Use Of Proceeds") do not and will not whether with or without the giving of notice or lapse of time or both (a) result in the violation by the Company of any statute or any rule (other than state or foreign securities or 

			
	
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"blue sky" laws, as to which we express no opinion), order or regulation of any Governmental Entity having jurisdiction over the Company known to us to which the Company is bound, (b) conflict with or result in a default by the Company under its Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws, as currently in effect, or (c) conflict with or constitute a breach of, or default or Repayment Event (as defined in Section 1(a)(xvi) of the Underwriting Agreement) under or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreement or instrument filed as an exhibit to the Registration Statement.

7.No consent, approval or authorization of, or designation, declaration or filing with, any Governmental Entity is required for the Company’s execution and delivery of, and the performance of its obligations under, the Underwriting Agreement and consummation by the Company of the transactions on its part contemplated thereunder, including the offering, issuance, sale and delivery of the Securities, other than (a) such as may be required under state or foreign securities or "blue sky" laws in connection with the purchase and distribution of the Securities by the Underwriters (as to which we express no opinion), (b) such as have been made or obtained under the 1933 Act and the 1933 Act Regulations and (c) such other consents, approvals, authorizations, designations, declarations or filings as have been made or obtained on or before the date hereof or which are not required to be made or obtained until after the date hereof. 

8.There are no preemptive or other similar rights to subscribe for or to purchase, nor any restriction upon the voting or transfer of, the Securities pursuant to (a) the Company’s Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, as currently in effect or (b) any agreement or other instrument known to us, except for such rights thereunder as have been duly waived.  Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, to our knowledge, there are no persons with registration or other similar rights to have any securities registered pursuant to the Registration Statement or otherwise registered by the Company under the 1933 Act except for such rights as have been duly waived. 

9.All descriptions in the Registration Statement, the General Disclosure Package and the Prospectus of contracts and other documents to which the Company is a party are accurate in all material respects; to our knowledge, there are no franchises, contracts, indentures, mortgages, loan agreements, notes, leases or other instruments required to be described or referred to in the Registration Statement, the General Disclosure Package and the Prospectus or to be filed as exhibits to the Registration Statement other than those described or referred to therein or filed as exhibits thereto.

10.Those statements in the Registration Statement, the General Disclosure Package, the Prospectus, the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 under the captions "Risk Factors—Risks Related to our Business and our Industry," "Risk Factors—Risks Related to our Legal and Regulatory Environment—Our products and operations are subject to extensive governmental regulation, and failure to comply with applicable requirements could cause our business to suffer" and "Risk Factors—Risks Related to our Legal and Regulatory Environment—A recall of our products, or the discovery of serious safety issues with our products, could have a significant negative impact on us," the Company's Annual Report on Form 10-K for the year ended December 31, 2017 under the captions "Item 1. Business—Third-Party Reimbursement" and "Item 1. Business—Government Regulation," the Registration Statement under the caption "Description of Capital Stock" and under Item 15 of the Registration Statement, and the Prospectus under the caption "Certain U.S. Federal Income Tax Considerations Applicable to Holders of Common Stock", insofar and to the extent that such statements constitute (i) a summary of matters of law or legal conclusions, (ii) a summary of provisions of the Company’s Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws, as currently in effect, or (iii) a summary of agreements or instruments of the Company as referred to therein, have each been reviewed by us and fairly present and summarize, in all material respects, such legal matters or legal conclusions, provisions of the Company’s Amended and Restated Certificate of Incorporation or 

			
	
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Amended and Restated Bylaws, as currently in effect, or such agreements or instruments of the Company as referred to therein, as applicable.  

11.The Registration Statement has been declared effective by the Commission under the 1933 Act and the 1933 Act Regulations; the Rule 462(b) Registration Statement became effective on filing; any required filing of the Prospectus pursuant to Rule 424(b) has been made in the manner and within the time period required by Rule 424(b) (without reference to Rule 424(b)(8)); any required filing of each Issuer Free Writing Prospectus pursuant to Rule 433 has been made in the manner and within the time period required by Rule 433(d); and, to our knowledge, no stop order suspending the effectiveness of the Registration Statement or any 462(b) Registration Statement has been issued under the 1933 Act or any order preventing or suspending the use of any preliminary prospectus, any Issuer Free Writing Prospectus or the Prospectus has been issued and no proceedings for any such purpose have been instituted or are pending or threatened by the Commission or any other Governmental Entity.

12.The Registration Statement, the Rule 462(b) Registration Statement, the General Disclosure Package and the Prospectus, excluding the documents incorporated by reference therein, as of their respective effective or issue dates (except for the financial statements and schedules, and the financial data derived therefrom, included therein or omitted therefrom, as to which we express no opinion) comply as to form in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations.   

13.The documents incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus (except for the financial statements and schedules, and the financial data derived therefrom, included therein or omitted therefrom, as to which we express no opinion), when they were filed with the Commission complied as to form in all material respects with the requirements of the 1934 Act and the 1934 Act Regulations.

14.The Company is not, and upon consummation of the issuance and sale of the Securities pursuant to the Underwriting Agreement and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package and the Prospectus, will not be, an "investment company" within the meaning of that term under the 1940 Act, as amended, and the rules and regulations of the Commission thereunder. 

In connection with our participation in the preparation of the Registration Statement, the General Disclosure Package and the Prospectus, we have not independently verified the accuracy, completeness or fairness of the statements contained therein (except with respect to paragraphs 9 and 10 above), and the limitations inherent in the examination made by us and the knowledge available to us are such that we are unable to assume, and we do not assume, any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement, the General Disclosure Package and the Prospectus (except with respect to paragraphs 9 and 10 above).  However, on the basis of our examination of the Registration Statement, the General Disclosure Package and the Prospectus and our participation in conferences with certain officers of the Company, representatives of the Company’s independent registered public accounting firm and representatives of the Underwriters and the Underwriters’ counsel in connection with the preparation of the Registration Statement, the General Disclosure Package and the Prospectus, we can advise you supplementally as a matter of fact and not as an opinion that nothing has come to our attention which would lead us to believe that (i) the Registration Statement, including any information deemed to be part thereof pursuant to Rule 430B, at the time the Registration Statement became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the General Disclosure Package, as of the Applicable Time, contained an untrue statement of a material 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, not misleading or (iii) the Prospectus, as of the date of the Prospectus and as of the date hereof, 

			
	
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contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  However, we are not expressing any belief as to the financial statements and the notes thereto or the schedules or other financial data contained in or omitted from the Registration Statement, the General Disclosure Package or the Prospectus. With respect to statements contained in the General Disclosure Package, any statement contained in any of the constituent documents shall be deemed to be modified or superseded to the extent that any information contained in subsequent constituent documents modifies or replaces such statement.

In addition, we can advise you supplementally as a matter of fact, and not as an opinion, that those statements in the Registration Statement, the General Disclosure Package and the Prospectus under the caption “Legal Proceedings,” insofar and to the extent that such statements constitute a summary of legal proceedings, have been reviewed by us and fairly present and summarize, in all material respects, such legal proceedings.

 

 

			
	
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Exhibit B

FORM OF OPINION OF COMPANY’S SPECIAL PATENT COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(c)

(i)To our knowledge, either the Company or its subsidiaries is the sole owner of record of each of the patents listed on Schedule I hereof (the "U.S. Patents") and each of the patent applications listed on Schedule II hereof (the "U.S. Applications").  To our knowledge, there are no pending claims asserted against the Company by any third parties to any ownership interest in any of the U.S. Patents or U.S. Applications. 

(ii)To our knowledge, the Company is the sole owner of (i) each of the foreign patents listed on Schedule III hereof (the "Non-U.S. Patents") (collectively, the U.S. Patents and Non-U.S. Patents are referred to herein as the "Patents") and (ii) each of the foreign patent applications listed on Schedule IV hereof (the "Non-U.S. Applications") (collectively, the U.S. Applications and the Non‐U.S. Applications are referred to herein as the "Applications").  To our knowledge, there are no pending claims asserted against the Company by any third parties to any ownership interest in the Non‐U.S. Patents or Non-U.S. Applications.

(iii)To our knowledge, the statements in the Registration Statement, the General Disclosure Package and the Prospectus under "Risk Factors – Risks Related to our Intellectual Property and Potential Litigation" and "Business – Intellectual Property" (collectively the "IP Portions"), solely to the extent that such statements relate to patents, patent applications, and patent rights of the Company, fairly present, to the extent required by the 1933 Act, in all material respects the legal matters, documents and proceedings relating to such Patents and Applications described therein.

(iv)We are not aware of any facts that have caused us to conclude that (a) the Company lacks any rights to use any material patents, if any, necessary to the conduct of its business as now conducted by the Company as described in the Registration Statement, the General Disclosure Package and the Prospectus, (b) the Company lacks clear title to the Patents and Applications, (c) any of the Patents are invalid or unenforceable, (d) the Company is infringing a valid patent of a third party, (e) the Company has failed to comply with the United States Patent and Trademark Office duty of candor and disclosure for each of the U.S. Patents, or (f) there are any material defects of form in the preparation or filing of the Applications, in each case, which would result in a material adverse effect on the Company.

(v)To our knowledge, there is no pending or overtly threatened action, suit, or proceeding, against the Company before any court or tribunal of competent jurisdiction based on allegations that the Company is infringing or otherwise violating any patents, copyrights, trade secrets, know-how or other proprietary rights of a third party and of a character required to be disclosed in the Registration Statement, the General Disclosure Package and the Prospectus that is not disclosed in the Registration Statement, the General Disclosure Package and the Prospectus as required by the 1933 Act.

(vi)To our knowledge, there is no pending or overtly threatened action, suit, or proceeding against the Company before any court, tribunal or the United States Patent and Trademark Office challenging the validity or scope of the Patents of a character required to be disclosed in the Registration Statement, the General Disclosure Package and the Prospectus that is not disclosed in the Registration Statement, the General Disclosure Package and the Prospectus as required by the 1933 Act.

(vii)To our knowledge, there is no infringement by any third party of the Patents, trade secrets, know how or other proprietary rights owned by the Company.

			
	
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(viii)We have reviewed the IP Portions of the Registration Statement, the General Disclosure Package and the Prospectus.  In connection with the preparation of the Registration Statement, the General Disclosure Package and the Prospectus, we have participated in certain conferences with officers and other representatives of the Company not including its certified public accountants, as well as with representatives of the Underwriters and their counsel.  At such conferences, the contents of the Registration Statement, the General Disclosure Package and the Prospectus and related matters were discussed. We have not independently verified, and accordingly are not confirming and assume no responsibility for, the accuracy, completeness or fairness of the statements contained in the Registration Statement, the General Disclosure Package or the Prospectus, except with respect to paragraph (iii) above.  On the basis of the foregoing, no facts have come to our attention that have caused us to believe that the information regarding the Patents and Applications of the Company included in the IP Portions of (a) the Registration Statement or any amendment thereto, including any information deemed to be a part thereof pursuant to Rule 430B, at the time such Registration Statement or any such amendment became effective, contained an untrue statement of a material fact with respect to the Patents and Applications or omitted to state a material fact with respect to the Patents and Applications required to be stated therein or necessary to make the statements therein not misleading, (b) the Prospectus or any amendment or supplement thereto, at the time the Prospectus was issued, at the time any such amended or supplemented prospectus was issued or as of the date hereof, included or includes an untrue statement of a material fact with respect to the Patents and Applications or omitted or omits to state a material fact with respect to the Patents and Applications necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (c) the General Disclosure Package, as of the Applicable Time, contained any untrue statement of a material fact with respect to the Patents and Applications or omitted to state any material fact with respect to the Patents and Applications necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

			
	
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Exhibit C

FORM OF LOCK-UP FROM DIRECTORS, OFFICERS 
OR OTHER STOCKHOLDERS PURSUANT TO SECTION 5(K)

 

 [●], 2018

Oppenheimer & Co. Inc.,
as Representative of the several
Underwriters to be named in the
within-mentioned Underwriting Agreement

c/o Oppenheimer & Co. Inc.,
85 Broad Street, 23rd Floor
New York, NY 10004

Re:Proposed Public Offering by Tandem Diabetes Care, Inc.

Dear Sirs:

The undersigned understands that Oppenheimer & Co. Inc. (the "Representative") proposes to enter into an Underwriting Agreement (the "Underwriting Agreement") with Tandem Diabetes Care, Inc., a Delaware corporation (the "Company") providing for the public offering (the "Offering") of shares (the "Securities") of the Company's common stock, par value $0.001 per share (the "Common Stock").  In recognition of the benefit that the Offering will confer upon the undersigned, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agrees with the underwriters to be named in the Underwriting Agreement (collectively, the "Underwriters") that, during the period beginning on the date hereof and ending on the date that is [90]/[45] days from the date of the final prospectus used to offer and sell Securities in the Offering pursuant to the Underwriting Agreement (the "Lock-Up Period"), the undersigned will not, without the prior written consent of the Representative, directly or indirectly, (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale of, or otherwise dispose of or transfer any shares of the Common Stock or any securities convertible into or exchangeable or exercisable for Common Stock, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition (collectively, the "Lock-Up Securities"), or exercise any right with respect to the registration of any of the Lock-up Securities, or file or cause to be filed any registration statement in connection therewith, under the Securities Act of 1933, as amended, or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Lock-Up Securities, whether any such swap or transaction is to be settled by delivery of Common Stock or other securities, in cash or otherwise.

Notwithstanding the foregoing, and subject to the conditions below, the undersigned may transfer the Lock-Up Securities without the prior written consent of the Representative, provided that (1) the Representative receives a signed lock-up agreement on substantially the same terms set forth in this Agreement for the balance of the Lock-Up Period from each donee, trustee, distributee, or transferee, as the case may be, (2) any such transfer shall not involve a disposition for value (other than those described below in (i) and (vii)), (3) in the case of clauses (ii) through (vi) below, such transfers that result in a reduction of beneficial ownership of the Lock-Up Securities are not required to be reported with the Securities and Exchange Commission (the "SEC") on Form 4 pursuant to Section 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and (4) the undersigned does not otherwise 

			
	
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voluntarily effect any public filing or report regarding such transfers (other than a filing on Form 5 made after the expiration of the Lock-Up Period):

	
 
	
(i)
	
as sales to the Underwriters pursuant to the Underwriting Agreement; or

	
 
	
(ii)
	
as a bona fide gift or gifts; or

	
 
	
(iii)
	
to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned; or

	
 
	
(iv)
	
to the legal representatives or a member of the immediate family of the undersigned by will or intestate succession; or

	
 
	
(v)
	
if the undersigned is an entity, as a distribution to the limited partners, members, trust beneficiaries or stockholders of the undersigned; or

	
 
	
(vi)
	
to the undersigned's affiliates, or to any investment fund or other entity controlled or managed by, directly or indirectly, or under common control or management with, the undersigned; or

	
 
	
(vii)
	
pursuant to a bona fide third party tender offer for all or substantially all of the outstanding shares of Common Stock, merger, consolidation or other similar transaction made to all holders of Securities involving a change of control of the Company; provided that in the event that such tender offer, merger, consolidation or other similar transaction is not completed, the Common Stock owned by the undersigned shall remain subject to the restrictions contained in this Agreement.

For purposes of this Agreement, "immediate family" shall mean any relationship by blood, marriage or adoption, not more remote than first cousin.

The foregoing restrictions shall not apply to the exercise (including a net or cashless exercise) of stock options granted pursuant to the Company's equity incentive plans (as they existed as of the date of this Agreement); provided that they shall apply to any of the Lock-Up Securities issued upon such exercise.

The foregoing restrictions shall not apply to the transfer of the Lock-Up Securities to the Company for the surrender or forfeiture of shares of Common Stock to satisfy tax withholding obligations upon exercise or vesting of stock options or equity awards, if and only if (i) such surrenders or forfeitures are not required to be reported with the SEC pursuant to Section 16(a) of the Exchange Act, and (ii) the undersigned does not otherwise voluntarily effect any public filing or report regarding such surrenders or forfeitures.

The foregoing restrictions shall not apply to the sale of shares of Common Stock purchased by the undersigned on the open market following the Offering, if and only if (i) such sales are not required to be reported with the SEC pursuant to Section 16(a) of the Exchange Act, and (ii) the undersigned does not otherwise voluntarily effect any public filing or report regarding such sales.

The foregoing restrictions shall not apply to the establishment of any contract, instruction or plan (a "Plan") that is designed to comply with Rule 10b5-1 under the Exchange Act; provided that, prior to the expiration of the Lock-Up Period, (i) no sales of the Lock-Up Securities shall be made pursuant to such a Plan, (ii) no public announcement of the establishment or existence of the Plan is required to be reported in any public report or filing with the SEC, or otherwise, and (iii) the undersigned does not otherwise voluntarily effect any public filing or report regarding the establishment or existence of the Plan. In 

			
	
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addition, the foregoing restrictions shall not apply to any shares sold pursuant to a Plan that complies with Rule 10b5-1 under the Exchange Act that is already in effect on the date hereof; provided that such Plan shall not be amended during the Lock-Up Period.

The Representative agrees (on behalf of the Underwriters) that, if and to the extent it releases any officer or director of the Company, or any Major Holder (as defined below) (in each case, when released, a "Releasee"), from any existing lock-up restriction with respect to any securities of the Company having a fair market value in excess of $1,000,000 in the aggregate (whether in one or multiple releases), then, to the extent the undersigned is a Major Holder (as defined below), this Agreement shall be automatically modified without further action to release a portion of the shares of Common Stock held by such Major Holder (on a pro rata basis with all other record or beneficial holders of similarly restricted securities of the Company based on the maximum percentage of shares held by any such record or beneficial holder being released from such holder's lock-up agreement) from the restrictions imposed by this Agreement so that the restrictions of this Agreement are no less favorable to the undersigned than the agreement applicable to the Releasee; provided the foregoing automatic modification of this Agreement shall not apply if the Representative released the Releasee to accommodate a financial hardship (as determined in the sole discretion of the Representative). For purposes of this Agreement, each of the following persons is a "Major Holder": each record or beneficial owner, as of the date hereof, of more than 1% of the outstanding shares of capital stock of the Company (for purposes of determining record or beneficial ownership of a stockholder, all shares of capital stock held by investment funds affiliated with such stockholder shall be aggregated).  To the extent the undersigned is a Major Holder, the Company shall, upon any such automatic modification of this Agreement, notify the undersigned of such modification in writing as promptly as reasonably practicable and in any event at least 12 hours prior to the open of the trading markets on the date such waiver, termination or suspension is to take effect.

The undersigned understands that the undersigned shall be released from all obligations under this Agreement if (i) the Company notifies the Representative that it does not intend to proceed with the Offering, (ii) the Underwriting Agreement does not become effective, or if the Underwriting Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Securities to be sold thereunder, or (iii) the Offering is not completed by September 30, 2018.

The undersigned agrees and consents to the entry of stop transfer instructions with the Company's transfer agent and registrar against the transfer of the Lock-Up Securities except in compliance with the foregoing restrictions.

The undersigned understands that the Underwriters are entering into the Underwriting Agreement and proceeding with the Offering in reliance upon this Agreement.

This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.

[Signature Page Follows]

 

			
	
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Exhibit 10.1

Very truly yours,

 

Signature:

Name:Exhibit

Exhibit 10.1

CONTRACT BETWEEN
SPIRE STL PIPELINE LLC
AND
MICHELS CORPORATION
FOR PROCUREMENT AND INSTALLATION OF GAS PIPELINE
FOR THE
SPIRE STL PIPELINE
DATED AS OF APRIL 26, 2018

	
					
	TABLE OF CONTENTS

	 
	 
	 
	Page
	

	 
	 
	 
	 

	ARTICLE 1
	DEFINITION OF TERMS
	1
	

	 
	 
	 

	ARTICLE 2
	SCOPE OF AGREEMENT
	4
	

	 
	 
	 
	 

	 
	2.1
	Commencement of Work
	4
	

	 
	2.2
	Priority of Documents
	4
	

	 
	2.3
	Preprinted Terms
	4
	

	 
	 
	 
	 

	ARTICLE 3
	STANDARDS FOR PERFORMANCE
	4
	

	 
	 
	 
	 

	 
	3.1
	Performance Standards
	4
	

	 
	3.2
	Schedule of Performance
	4
	

	 
	3.3
	Final Acceptance
	4
	

	 
	3.4
	Compliance with Applicable Law
	5
	

	 
	3.5
	Permits, Fees, Notices, Licenses and Compliance with Law
	5
	

	 
	 
	 
	 

	ARTICLE 4
	INVOICING AND PAYMENT
	5
	

	 
	 
	 
	 

	 
	4.1
	Contract Price
	5
	

	 
	4.2
	Travel Expenses
	6
	

	 
	4.3
	Payment Terms for Change Orders
	6
	

	 
	4.4
	Submission of Invoices
	6
	

	 
	4.5
	Invoice Format and Copies
	6
	

	 
	4.6
	Payment
	6
	

	 
	4.7
	Statement
	7
	

	 
	4.8
	Final Payment
	7
	

	 
	 
	 
	 

	ARTICLE 5
	PROJECT CONTROLS
	7
	

	 
	 
	 
	 

	 
	5.1
	Reports
	7
	

	 
	5.2
	Time-and-Material Reports
	7
	

	 
	 
	 
	 

	ARTICLE 6
	INDEPENDENT CONTRACTOR STATUS
	7
	

	 
	 
	 

	ARTICLE 7
	CONTRACTOR’S PERSONNEL AND RESPONSIBILITIES
	8
	

	 
	 
	 
	 

	 
	7.4
	Pre-Job Conferences
	8
	

	 
	7.5
	Labor Indemnification
	8
	

	 
	7.6
	Experienced Employees
	8
	

	 
	7.7
	Contractor Responsible for Conduct of Employees
	8
	

	 
	7.8
	Key Personnel
	8
	

	 
	7.9
	Supervisor
	8
	

	 
	7.10
	Employee Fitness
	8
	

	 
	7.11
	Former Employees
	9
	

	 
	7.12
	Duty to Cooperate
	9
	

	 
	7.13
	Field Records
	9
	

	 
	7.14
	Protection of Property and Public Liability
	9
	

	 
	7.15
	Damage to Existing Property
	9
	

	 
	7.16
	Rights-Of-Way
	9
	

	 
	7.17
	On Private Property
	9
	

	 
	7.18
	Work within Highway and Railroad Rights-of-Way
	10
	

	 
	 
	 
	 

	ARTICLE 8
	SUBCONTRACTUAL RELATIONS
	10
	

	 
	 
	 
	 

	 
	8.1
	Subcontractual Relations
	10
	

	 
	8.2
	Subcontracts
	10
	

	 
	8.3
	No Privity with Subcontractors
	10
	

	 
	8.4
	Assignment of Subcontracts
	10
	

i

	
					
	 
	8.5
	Contractor’s Payments to Subcontractors
	10
	

	 
	8.6
	Disputes with Subcontractors
	10
	

	 
	8.7
	Compliance with Applicable Law
	10
	

	 
	 
	 
	 

	ARTICLE 9
	INSURANCE
	10
	

	 
	 
	 
	 

	 
	9.1
	Required Coverages
	10
	

	 
	9.2
	Claims Made Coverage
	11
	

	 
	9.3
	Evidence of Insurance
	11
	

	 
	9.4
	Notice of Cancellation
	12
	

	 
	9.5
	Self-Insured Retention
	12
	

	 
	9.6
	Additional Coverages
	12
	

	 
	9.7
	Non-Waiver
	12
	

	 
	9.8
	Company’s Right to Purchase
	12
	

	 
	9.9
	Accident/Incident Report
	12
	

	 
	9.10
	Contractor Obligations Not Limited
	12
	

	 
	 
	 
	 

	ARTICLE 10
	INDEMNIFICATION
	12
	

	 
	 
	 
	 

	 
	10.1
	Standard Indemnity
	12
	

	 
	10.2
	Indemnity in Excess of $25 Million
	13
	

	 
	 
	 
	 

	ARTICLE 11
	WARRANTIES
	13
	

	 
	 
	 
	 

	 
	11.1
	Warranties
	13
	

	 
	11.2
	Remedies
	13
	

	 
	11.3
	Inspection
	14
	

	 
	 
	 
	 

	ARTICLE 12
	RISK OF LOSS AND TITLE
	14
	

	 
	 
	 
	 

	 
	12.1
	Contractor’s Risk
	14
	

	 
	12.2
	Warranty of Title
	14
	

	 
	 
	 
	 

	ARTICLE 13
	SITE CONDITIONS
	14
	

	 
	 
	 
	 

	 
	13.1
	Site Investigations
	14
	

	 
	13.2
	Site Conditions
	14
	

	 
	 
	 
	 

	ARTICLE 14
	MATERIAL PROVISIONS
	14
	

	 
	 
	 
	 

	 
	14.1
	Material Supply (Specifications)
	14
	

	 
	14.2
	Minor Defects
	14
	

	 
	14.3
	Routing of Shipments; Shipping
	14
	

	 
	14.4
	Receiving, Handling, and Storage
	15
	

	 
	14.5
	Contractor’s Duty to Check
	15
	

	 
	14.6
	Specifications and Drawings
	15
	

	 
	 
	 
	 

	ARTICLE 15
	TESTS AND INSPECTIONS
	15
	

	 
	 
	 
	 

	 
	15.1
	Company’s Attendance
	15
	

	 
	15.2
	Company Inspections
	15
	

	 
	15.3
	Rejected Work
	15
	

	 
	15.4
	Timing
	16
	

	 
	15.5
	Covering the Work
	16
	

	 
	15.6
	Final Inspection
	16
	

	 
	 
	 
	 

	ARTICLE 16
	COMPANY’S USE OF THE WORK
	16
	

	 
	 
	 
	 

	 
	16.1
	Company’s Use
	16
	

	 
	16.2
	Submittals
	16
	

	 
	 
	 
	 

	ARTICLE 17
	SITE SAFETY AND SECURITY
	16
	

	 
	 
	 
	 

	 
	17.1
	Site Safety
	16
	

	 
	17.2
	Security Regulations
	16
	

ii

	
					
	 
	17.3
	Reporting
	17
	

	 
	17.4
	Emergencies
	17
	

	 
	17.5
	Cleanliness
	17
	

	 
	17.6
	Site Trespass
	17
	

	 
	 
	 
	 

	ARTICLE 18
	ENVIRONMENTAL REQUIREMENTS
	17
	

	 
	 
	 
	 

	 
	18.1
	Hazardous Substances Brought or Used by Contractor
	17
	

	 
	18.2
	Pre-Existing Hazardous Substances
	17
	

	 
	18.3
	Investigation and Determination
	17
	

	 
	18.4
	Plan for Removal or Abatement
	17
	

	 
	18.5
	Contractor Chemical Use and Disposal Requirements
	18
	

	 
	18.6
	Notice
	18
	

	 
	18.7
	Inclusion in Subcontracts
	18
	

	 
	18.8
	Material Safety Data Sheets Required
	18
	

	 
	18.9
	Labeling and Training
	18
	

	 
	 
	 
	 

	ARTICLE 19
	DRUGS AND ALCOHOL
	18
	

	 
	 
	 

	ARTICLE 20
	TAXES
	18
	

	 
	 
	 

	ARTICLE 21
	LIENS
	19
	

	 
	 
	 
	 

	 
	21.1
	Lien Waivers
	19
	

	 
	21.2
	Lien Free Projects
	19
	

	 
	21.3
	Right to Discharge Liens
	19
	

	 
	 
	 
	 

	ARTICLE 22
	AUDIT AND RECORDS
	19
	

	 
	 
	 

	ARTICLE 23
	CHANGE ORDERS
	19
	

	 
	 
	 
	 

	 
	23.1
	Changes in the Work
	19
	

	 
	23.2
	Contractor Change Requests
	20
	

	 
	23.3
	No Change Order for Contractor Delay or Error
	20
	

	 
	23.4
	Duty to Continue the Work
	20
	

	 
	23.5
	Effect of Changes in the Law
	20
	

	 
	 
	 
	 

	ARTICLE 24
	DELAY, ACCELERATION
	20
	

	 
	 
	 
	 

	 
	24.1
	No Extension of Final Completion Date
	20
	

	 
	24.2
	Acceleration Ordered by Company
	21
	

	 
	24.3
	Extension of Time
	21
	

	 
	 
	 
	 

	ARTICLE 25
	TERMINATION AND SUSPENSION
	21
	

	 
	 
	 
	 

	 
	25.1
	Termination with Cause
	21
	

	 
	25.2
	Termination or Suspension without Cause
	21
	

	 
	25.3
	Resumption of Work
	22
	

	 
	 
	 
	 

	ARTICLE 26
	CLAIMS
	22
	

	 
	 
	 

	ARTICLE 27
	DISPUTE RESOLUTION
	22
	

	 
	 
	 
	 

	 
	27.1
	Mediation
	22
	

	 
	27.2
	Work to Continue
	22
	

	 
	 
	 
	 

	ARTICLE 28
	DELIVERY AND RETENTION OF DOCUMENTATION
	22
	

	 
	 
	 
	 

	 
	28.1
	Documentation and Proprietary Information
	22
	

	 
	28.2
	Documentation
	22
	

	 
	28.3
	Retention of Documents
	22
	

	 
	 
	 
	 

	ARTICLE 29
	CONFIDENTIAL INFORMATION
	23
	

	 
	 
	 
	 

	 
	29.1
	Contractor’s Obligations
	23
	

	 
	29.2
	Irreparable Harm
	23
	

iii

	
					
	 
	 
	 
	 

	ARTICLE 30
	OWNERSHIP OF WORK PRODUCT
	23
	

	 
	 
	 
	 

	 
	30.1
	Work Product
	23
	

	 
	30.2
	Assignment
	23
	

	 
	30.3
	Contractor’s Retained Information
	24
	

	 
	30.4
	Knowledge
	24
	

	 
	30.5
	Use of Work Product
	24
	

	 
	 
	 
	 

	ARTICLE 31
	MISCELLANEOUS
	24
	

	 
	 
	 
	 

	 
	31.1
	Complete Agreement of the Parties
	24
	

	 
	31.2
	Notices
	24
	

	 
	31.3
	No Third-Party Beneficiary
	24
	

	 
	31.4
	Assignment
	24
	

	 
	31.5
	Choice of Law/Interpretation
	24
	

	 
	31.6
	Severability
	24
	

	 
	31.7
	Amendments
	25
	

	 
	31.8
	Non-Waiver
	25
	

	 
	31.9
	Liability Limitation
	25
	

	 
	31.10
	Waiver of Consequential Damages
	25
	

	 
	31.11
	Interpretation
	25
	

	 
	31.12
	Non-Exclusive
	25
	

	 
	31.13
	Survival
	25
	

iv

EXHIBITS
EXHIBIT A    SCOPE OF WORK/SPECIFICATIONS
EXHIBIT B    PROJECT SCHEDULE/MILESTONE DATES
EXHIBIT C    SCHEDULE OF COMPENSATION 
EXHIBIT D    COMPLETION CERTIFICATES
EXHIBIT E    KEY PERSONNEL
EXHIBIT F    CONTRACTOR SAFETY AND HEALTH PROGRAM 
		
	EXHIBIT G
	FORM OF CONTRACTOR’S AFFIDAVIT OF COMPLIANCE WITH 49 CFR §§ 199, 40, AND 382 

EXHIBIT H    OPERATOR QUALIFICATION PLAN 
EXHIBIT I    PAYMENT DOCUMENTATION
EXHIBIT J    PERMITS
EXHIBIT K    PROJECT CONTROLS/REPORTING REQUIREMENTS
EXHIBIT L    APPROVED SUBCONTRACTORS LIST
EXHIBIT M    COMPLETION PROCESS
EXHIBIT N    LIQUIDATED DAMAGES
EXHIBIT O    COMPANY-FURNISHED ITEMS
EXHIBIT P    FORM OF CHANGE ORDER
EXHIBIT Q    TRESPASS PROTOCOL
EXHIBIT R    FORM OF INVOICE
EXHIBIT S    CONTRACTOR CLARIFICATIONS

SPIRE STL PIPELINE LLC 
CONTRACT FOR 
PROCUREMENT AND INSTALLATION 
OF GAS PIPELINE
This Contract for Procurement and Installation of Gas Pipeline (this “Contract”) is made and entered into as of the 26th day of April, 2018 (“Effective Date”) by and between Spire STL Pipeline LLC, a Missouri limited liability company (“Company”), and Michels Corporation, a Wisconsin corporation (“Contractor”), for the work as set forth in Exhibit A (the “Project”), a new gas pipeline, as well as related appurtenances such as roads, walks, and landscaping to be located at the Site (defined below).  Company and Contractor may hereinafter be referred to individually as “Party” and collectively as “Parties”.
ARTICLE 1DEFINITION OF TERMS
The following terms, wherever used in any documents which form part of the Contract Documents, shall have the meanings indicated below unless the context otherwise requires:
“Account Records” means any and all information, materials and data of every kind and character, including hard copies and electronic data, if available, related to records, books, papers, documents, subscriptions, recordings, agreements, purchase orders, leases, contracts, commitments, arrangements, notes, daily diaries, superintendent reports, drawings, receipts, vouchers and memoranda, and any and all other agreements, sources of information and matters that may in Company’s judgment have any bearing on or pertain to any matters, rights, duties or obligations under or covered by the Contract Documents to the extent necessary to adequately permit evaluation and verification of Contractor’s compliance with any aspect of the Contract Documents and Company’s business ethics expectations. 
“Affiliate” means any person that, directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the specified person.  For purposes of this definition, “control” (including the terms “controlled by” and under “common control with” means the possession, directly or indirectly, of the power to direct or to cause the direction of the management policies of a person, whether through the ownership of voting securities, by contract or otherwise.
“Business Day” means any Day except Saturday, Sunday, or a weekday that is observed by Company as a holiday.
“Callback Period” means a period of one year from the date of Final Acceptance.
“Certificate of Final Acceptance” means a document, in the applicable form attached to Exhibit D (Completion Certificates) hereto, executed by Company and Contractor confirming that Final Acceptance has occurred.
“Change Order” means a written order issued by Company to Contractor pursuant to Article 23 that modifies the Contract Documents.  
“Company’s Authorized Representative” means Company’s duly authorized representative, who will provide the general administration of this Contract on behalf of Company.  Unless otherwise stated in a written delegation of authority, Company’s Authorized Representative does not have authority to amend or waive any portion of this Contract.  Company may, in its sole discretion, change its Authorized Representative at any time or from time to time, and shall promptly notify Contractor of any such change.
“Company Hazardous Substances” has the meaning set forth in Section 18.2.
“Confidential Information” means any and all data, documentation, methods, processes, materials, and all other information relating to the past, present, and future business of Company, including this Contract.  Confidential Information also includes all information owned or provided by customers, suppliers, or other third parties to whom Company owes an obligation of confidentiality, and all Work Product (as that term is defined in Article 30).  Confidential Information does not include any information that is: (i) publicly available or becomes publicly available through no breach of the Contract Documents by Contractor, its Subcontractors or their employees; or (ii) information that Contractor can show, by written records, was known to Contractor prior to the date of the Effective Date.
“Construction Mobilization Date” means the latest date on which Contractor must mobilize (which does not include mobilization to clear trees or horizontal directional drilling bores) its workforce to commence pipeline construction, which, as of the Effective Date, is June 25, 2018. 
“Construction Standards” means the standards for construction identified in the Specifications for the Project.

1

“Contract Documents” means: (a) this Contract; (b) the Scope of Work and any applicable Specifications; (c) any applicable Drawings; (d) the Schedule; (e) any duly executed Change Orders; and (f) any other Exhibits incorporated in the Contract. 
“Contractor Change Request” has the meaning set forth in Section 23.2.
“Contractor Safety and Health Program” means Contractor’s safety and loss control program and attached documentation as defined in Exhibit F. 
“Contractor’s Authorized Representative” means Contractor’s duly authorized representative, who will provide the general administration of this Contract on behalf of Contractor and shall be Contractor’s representative in all matters relating to this Contract.  Contractor may change its Authorized Representative at any time.  However, a fully qualified replacement must be ready to assume responsibility for Contractor’s Authorized Representative and is subject to prior approval of Company’s Authorized Representative, which shall not be unreasonably withheld.
“Contractor’s Retained Information” has the meaning set forth in Section 30.3.
“Contract Price” means the total aggregate price for the Work as determined pursuant to Section 4.1 and as increased or decreased by any Change Order or, pursuant to Section 23.4 written direction of Company.
“Critical Path” means the longest calculated path of dependent activities in the Schedule necessary for completion of the Work or the Project, as the case may be, and as more specifically defined in Exhibit K (Project Controls/Reporting Requirements). 
“Day” means a calendar day of 24 hours commencing at 12:00 a.m.  
“Drawings” are the graphic and pictorial portion of the Contract Documents wherever located and whenever issued, showing the design, location, and dimensions of the Work, generally including plans, elevations, sections, details, and diagrams.
“Engineer” or “Architect” means the independent representative who will act on the behalf of Company for certain technical purposes.  If no independent representative is used by Company, “Engineer” or “Architect” means Company.
“Final Acceptance” means the acceptance and/or approval of the Work by the execution of a Certificate of Final Acceptance by Company (or other mutually agreed to procedure), provided that the Work meets all of the requirements of the Contract Documents
“Final Completion” means the full performance by Contractor and Company of each of the Parties’ respective obligations under the Contract Documents, including Exhibit M (Completion Process) and all revisions and amendments thereof.
“Final Completion Date” means the contractually-required date for Final Completion of the Work listed in the Milestone Dates and the Schedule
“Force Majeure” has the meaning set forth in Section 24.3.
“Governmental Filings” has the meaning set forth in Section 3.5(c).
“Guaranteed Substantial Completion Date” means the contractually-required date for Substantial Completion for the Work as set forth in the Contract Documents, including Exhibit B (Project Schedule/Milestone Dates), Exhibit M (Completion Process), and Exhibit N (Liquidated Damages), as such date may be changed from time to time in accordance with Article 23.  
“Hazardous Substances” means any material in any physical form that may pose a present or potential threat to human health and safety or the environment.  This includes all materials defined in any statute as hazardous substances or hazardous wastes and asbestos-containing materials in any form, polychlorinated biphenyl’s (PCBs), and oil or other petroleum by-products.
“HDD Mobilization Date” means the latest date on which Contractor must mobilize its workforce to commence horizontal direction drilling, which, as of the Effective Date, is August 9, 2018.  
“Indemnitees” has the meaning set forth in Article 10. 
“Knowledge” has the meaning set forth in Section 30.4.

2

“Latent Defect” means a defect which exists in the Work prior to the end of the Callback Period and that was not and normally would not have been revealed, discovered, or located before the end of the Callback Period by any reasonably careful inspection or by any known or customary test.  
“Law” means all laws, statutes, codes, ordinances, rules, regulations, lawful orders, and other legal requirements, in addition to judicial decrees and interpretations, permits, and licenses, including those concerning health, safety, and the protection of the environment, as amended from time to time, of all federal, state, county, and local governmental agencies and authorities that are applicable to the Work and any of Contractor’s obligations under the Contract Documents.
“Losses” means any costs, damages, losses, claims, demands, causes of action, suits or other litigation (including all costs thereof and reasonable attorney’s fees) of every kind and character. 
“Material” means all material, equipment, products, supplies, goods, articles, processes, apparatus, machinery, and documentation to be furnished by Contractor and necessary to complete the Work set forth in the Contract Documents.
“Milestone” means a specific portion of Contractor’s Work as defined by the Contract Documents.
“Milestone Date” means a date identified in the Milestone Dates set forth in Exhibit B (Project Schedule/Milestone Dates) on which Contractor must complete a specific portion of its Work.
“Operator Qualification Plan” has the meaning set forth in Section 3.5(d).
“Operator Qualification Regulations” means the U.S. Department of Transportation Pipeline Safety Regulations 49 CFR 192 and the State of Missouri Code of State Regulations Part 4 CSR 240-40.030.  
“Payment Milestone” means a Milestone, the successful completion of which results in a payment by Company to Contractor for a specified portion of the Contract Price, as described on Exhibit C.
“Permits” means any licenses, permits, inspections or approvals required by any governmental authority having jurisdiction.
“Punchlist” means an itemized list prepared by Contractor and augmented, if necessary, by Company, of those portions of the Work that Company’s inspection reasonably indicates have not been completed in accordance with the requirements of the Contract Documents.  Subject to verification by Company, Contractor shall, at its own expense, complete all Work (including all corrections or replacements) indicated by the Punchlist and test or inspect, as appropriate, any portions of the Work so completed or corrected.  
“Retainage” or “Retention” has the meaning set forth in Section 4.7.
“Schedule” means the Company-approved schedule attached as Exhibit B for the performance of the Work.   
“Services” means all of the labor, supervision, administration, and other services, required to complete the Work.
“Site” means Company’s yard, station, easement, office, or other location, as defined by Company, for which the Work is intended.
“Specifications” means that portion of the Contract Documents consisting of a set of written directions, provisions, and requirements giving interpretation to Contractor’s Work.  The Specifications and Drawings are intended to supplement but not necessarily duplicate each other.  Any Work exhibited in the one and not in the other shall be executed as if it had been set forth in both, so that the Work will be performed according to the complete design as determined by Company. 
“Subcontract” means a contract entered into by Contractor and a Subcontractor to perform any portion of the Work.
“Subcontractor” means an entity at any tier having a contract with Contractor or any of its Subcontractors for the Work.
“Substantial Completion” means the Work has progressed to the point where, in the reasonable opinion of Company as evidenced by the issuance of a definitive Certificate of Substantial Completion (Exhibit D), it is substantially complete, in accordance with the conditions precedent set forth in the Contract Documents, including Exhibit M.

3

“Testing Regulations” means those certain Federal Pipeline Safety Regulations found at 49 CFR §199, 49 CFR §40, and 49 CFR §382 and Missouri Pipeline Safety Regulations found at 4 CSR 240-40.080, as amended.  
 “Welding Procedures” means the welding procedures provided by Contractor pursuant to Specifications Schedule A-9 and approved by Company.
“Work” means all Material and Services that Contractor is obligated to provide under the Contract Documents.  All obligations of the Contractor shall be performed as specified in the Contract Documents.  
“Work Product” has the meaning set forth in Section 30.1.
All other capitalized terms used herein shall have the meanings ascribed to them in this Contract.
ARTICLE 2    SCOPE OF AGREEMENT 
2.1    Commencement of Work.  Contractor shall not commence Work until after this Contract has been executed, and Contractor will furnish all of the Work identified in the Contract Documents.  
2.2    Priority of Documents.  To the extent of any ambiguity, discrepancy, conflict, or inconsistency between the documents comprising the Contract Documents, the authority of the individual documents relative to the other documents is, in descending order of authority:  (a) any duly executed Change Order; (b) Michels Clarifications attached as Exhibit S; (c) this Contract with the exception of Exhibit A (Scope of Work/Specifications); (d) any applicable Scope of Work or Specifications set forth in Exhibit A; (e) the Schedule; (f) any applicable Drawings; and (g) any other documents identified in the Contract as comprising the Contract Documents.  Notwithstanding the foregoing, the several documents forming the Contract Documents shall be taken as mutually explanatory of one another; however, with respect to any conflict or inconsistency not resolved by this Section 2.2, or where there exists ambiguities, discrepancies, conflicts, or inconsistencies between documents of equal precedence to each other, Company shall decide priority of such documents.
2.3    Preprinted Terms.  This Contract supersedes any preprinted terms or conditions on any preprinted invoice submitted by Contractor or any printed or typed conditions forming a part of Contractor’s proposal.  Any additional or different terms and conditions set forth in Contractor’s invoices, purchase order acknowledgments, or similar writings or in Contractor’s electronic data interchange acknowledgments are objected to by Company and will not be binding upon Company unless specifically assented to in writing by an authorized agent of Company.
ARTICLE 3    STANDARDS FOR PERFORMANCE
3.1    Performance Standards.  Contractor shall perform all Work in a competent manner, and in compliance with all applicable standards, including all applicable industry standards and professional standards of care for the Work, and those that are set forth in the Contract Documents.  Contractor agrees to perform, to the entire satisfaction of Company, the Work described in the Contract Documents and in accordance with the applicable Construction Standards, Welding Procedures, and Company Policies.  Contractor acknowledges receipt of the Construction Standards and Welding Procedures in effect as of the Effective Date.  
3.2    Schedule of Performance.  Before starting the Work, Contractor shall submit for approval by Company, a Schedule identifying all Milestone Dates, including the Guaranteed Substantial Completion Date, for the Work and providing sufficient details to fully describe its plan for timely completing all of the Work as set forth in the Schedule.  Contractor shall complete the specified portion of its Work on or prior to each Milestone Date for such completion as set forth in the Schedule.  Contractor shall not modify the Schedule without Company’s written approval.  Time is of the essence for completion of the Work.  Delays or possible delays in the performance of the Work or in the completion of the Milestone Dates set forth in Exhibit B shall be reported to Company within five Days of the first Day that Contractor knows or, by applying prudent industry practices, should have known of the possible delay.  Contractor shall take all necessary steps, including acceleration of the Work, at no additional cost to Company, to recover delays in the Schedule, except to the extent such delays are caused by the fault of Company.  
3.3    Final Acceptance.  The Work shall not be deemed complete until after all of the Work, including any Punchlist Work, is completed to Company’s reasonable satisfaction.
3.4    Compliance with Applicable Law.  Contractor will comply, and will cause all of its personnel, representatives and Subcontractors to comply, with all Law applicable to the Contractor’s performance under the Contract Documents.  Contractor shall make all notifications relating to commencement and progress of the Work as required by Law.  Where not in conflict with applicable Law, Contractor will comply with all rules, Company Policies provided to Contractor, jobsite requirements, and procedures of Company.

4

3.5    Permits, Fees, Notices, Licenses and Compliance with Law.  
(a)    Permits.  Prior to commencing Work, Contractor will obtain, and at all times during the Project, maintain, those Permits assigned as Contractor’s responsibility on Exhibit J (Permits).  Contractor will charge Company for Permits at Contractor’s actual cost, with no mark-up.  Company will obtain, at all times during the Project maintain, and pay for all Permits assigned as Company’s responsibility on Exhibit J (Permits), in such time so as not to impede Contractor’s performance of the Work in accordance with the Schedule.  With respect to any Permits required for the Project but not set forth on Exhibit J, the Parties will mutually agree regarding the respective responsibilities for such Permits.  If obtaining any Permit not set forth on Exhibit J requires Contractor to perform work not set forth on Exhibit A (Scope of Work / Specifications) or incur additional costs, then Contractor will be entitled to seek a Change Order for such additional Work.  
(b)    Compliance with Law.  Contractor will comply, and will cause all of its personnel, representatives and Subcontractors to comply, with all Law applicable to the Contractor’s performance under the Contract Documents.  Any costs, fines, penalties, awards, damages, or other liabilities associated with any Contractor violations of this Section 3.5 shall be borne and paid solely by Contractor, and Contractor shall indemnify Company for such violations to the fullest extent provided by Law.
(c)    Governmental Filings.  Contractor shall immediately notify Company’s Authorized Representative of all known claims, filings, or other submissions made by or against Contractor and/or its employees to or by governmental regulatory agencies arising from or occurring during the performance of the Work (collectively “Governmental Filings”).  Contractor shall require all Subcontractors to immediately inform Contractor of Governmental Filings known to them and shall promptly inform Company’s Authorized Representative of such Governmental Filings.  
(d)    Pipeline Safety.  In addition, Contractor is aware of and acknowledges its responsibilities under the Testing Regulations.  Contractor will fulfill, and will cause all of its applicable personnel, representatives and Subcontractors to fulfill, all of the requirements of the Testing Regulations in the performance under this Contract.  Contractor will provide such access to its premises (including any job-site), property, personnel, representatives, and records by Company, the Research and Special Programs Administrator, the Federal Department of Transportation, the Missouri Public Service Commission, and any and all governmental authority or their representatives, as is necessary for the purpose of monitoring Contractor’s compliance with the Testing Regulations.  PRIOR TO COMMENCING WORK, CONTRACTOR AND ANY OF ITS APPROVED SUBCONTRACTORS ARE REQUIRED TO COMPLETE AND DELIVER TO COMPANY AN AFFIDAVIT OF COMPLIANCE IN THE FORM ATTACHED HERETO AS EXHIBIT G.  
(e)    Operator Qualification.  Prior to commencing Work and at all times during the Term, Contractor will comply with the operator qualification plan attached hereto as Exhibit H (the “Operator Qualification Plan”).  Contractor represents and warrants that the Operator Qualification Plan satisfies all the requirements of the Operator Qualification Regulations.  All Contractor personnel who will be performing “covered tasks” (as defined by the Operator Qualification Plan or Operator Qualification Regulations) must comply with the Operator Qualification Plan and Operator Qualification Regulations.  Prior to commencing Work and upon Company’s request at any time during the Term, Contractor will deliver to Company all of the required operator qualification records and other records necessary to obtain and maintain compliance with the Operator Qualification Regulations.
ARTICLE 4    INVOICING AND PAYMENT
4.1    Contract Price.  
(a)    Mobilization Payments.  Company shall pay Contractor $12,500,000, in advance payments subject to Retention and via electronic funds transfer to a U.S. bank account designated by Contractor, as follows: (1) $4,200,000 on or before five Business Days after receipt of Contractor’s invoice after Contractor commences tree-clearing mobilization for the tree-clearing Work and (2) $8,300,000 on or before five Business Days after receipt of Contractor’s invoice after Contractor commences its construction mobilization for the pipeline construction Work.  If Contractor is terminated for any reason, the applicable terms of Article 25 shall apply.  

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(b)    Lump Sum Pricing.  The Contractor’s total compensation for its performance of acceptable Work as required by the Contract Documents shall be a fixed lump sum price, unless unit pricing is applicable.  
(c)    Unit Pricing.  For all Unit Price Work, an amount equal to the sum of the established unit price for each separately identified item of Unit Price Work times the estimated quantity of that item as indicated in the chart identified in Exhibit C.  Estimated quantities are not guaranteed, and Contractor shall be paid for all actual quantities installed and accepted by Company after determinations of actual quantities and classification are made by Contractor.  
4.2    Travel Expenses.  All business travel related to the performance of any Work that is specifically provided for in the Contract Documents shall be billed at cost.  Billing must be limited to lowest-available rates and must be accompanied by proper receipts.  If no advance approval has been received from Company, Contractor shall be responsible for all expenses it incurs.
4.3    Payment Terms for Change Orders.  All duly executed Change Orders shall be shown as a separate line item in the monthly Applications for Payments.
4.4    Submission of Invoices.  On or about the tenth Day of each calendar month, Contractor shall submit to Company’s accounts payable department an invoice in the form of Exhibit R (Form of Invoice) for payment based upon Contractor’s successful completion, as determined by Company, of Work during the prior month.  Each invoice shall contain the appropriate supporting documentation and lien waivers provided in Exhibit I (Payment Documentation).  All invoices shall be sent simultaneously via electronic mail to both of the following addresses: Accounts_Payable@spireenergy.com with a copy to Kathy Cariolano at Kathy.Cariolano@spireenergy.com.  Company shall pay Contractor within 30 Days following Company’s receipt of a proper and complete invoice.  Company may decline to pay an invoice, in whole or in part, to the extent necessary to protect Company from loss due to (a) breach by Contractor of any of its obligations under these Contract Documents including the costs to Company of remedying the breach and all other costs directly attributable to other services that are required to be performed in connection with remedying such breach; (b) third-party claims filed or reasonable evidence indicating probable filing of such claims, except to the extent Contractor’s insurers have agreed in writing to cover such claims or where Contractor has accepted an obligation to indemnify Company against such claim; (c) damage to Company or another contractor to the extent Contractor is obligated to indemnify Company for such damage; (d) reasonable evidence that the Work will not be completed within the time requirements specified in these Contract Documents; (e) unsubstantiated or unsupported amounts paid by Company to Contractor; (f) Contractor’s failure to properly pay Subcontractors or to properly pay for equipment, materials or labor; or (g) any undisputed amounts due to Company under the terms of these Contract Documents.  If requested by Company, Contractor shall submit a partial waiver of lien satisfactory to Company with respect to each Subcontractor (regardless of tier) and material supplier providing goods or services in excess of $125,000 in the aggregate, certifying to the receipt of the exact amount shown by Contractor’s sworn statement for the previous invoice as having been included in the previous request for payment to Company for that particular Subcontractor or material supplier.  If Company so requests, final waivers of lien by all Subcontractors and material suppliers providing goods or services in excess of $125,000 in the aggregate, and affidavits that all bills for material and labor have been paid by Contractor and each Subcontractor shall be furnished with the final invoice with respect to the Work.  Company may set off against any amount payable under these Contract Documents any and all present undisputed indebtedness of Contractor to Company.  The elements of all amounts invoiced shall be shown separately, by applicable line items, and shall be classified or further broken down as Company may require for accounting and payment purposes.  Invoices that Company deems to be inaccurate or incomplete, in Company’s reasonable discretion, may be returned to Contractor for correction and re-submittal.  Company shall notify Contractor of any rejected invoice or portion thereof with reasons for such rejection.
4.5    Invoice Format and Copies.  Contractor shall submit one original and one duplicate of each invoice including all supporting documentation and lien waivers provided in Exhibit I.  Contractor shall meet the Company’s invoicing requirements related to payment information.  All invoices must be submitted electronically.  If the Work is being performed pursuant to a Change Order, each invoice shall also include a detailed itemized list of the charges of Change Order Work covered by the invoice identifying or containing the number of each class of employees, the number of hours worked, the rates charged for such hours, a copy of all Subcontractor itemized invoices, separately itemized charges for freight, all material used, and, for all special trucking and special heavy power tools, all adequately described, with all applicable sales and use taxes stated.  Overtime hours shall be billed as such rather than as a greater number of regular hours.  Cost of local permits shall be billed with the job, with a copy of the receipt for the permit attached to the invoice.  Copies of invoices from cities for paving repairs in locations where city ordinance does not allow Contractor to make repairs shall be attached to Contractor’s invoice for reimbursement.  Contractor must provide sufficient information with each invoice, as specified by Company, to comply with Company’s record-keeping, regulatory, and customer billing requirements.
4.6    Payment.  Subject to the provisions of Section 4.1 and unless otherwise agreed to by the Parties, Company will provide payment of 90% of the total amount contained in each invoice within 30 Days of receipt of an invoice acceptable to Company including supporting documentation required by Exhibit I and any quality assurance documentation which may be specified.  Company will retain 10% of each invoice amount (referred to as “Retainage” or “Retention”).  Subject to the other terms of this Contract (including Article 21 and Section 24.1), Company will pay the Retainage to Contractor as follows: (a) 25% of the then-aggregate Retainage upon Substantial 

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Completion and the submission of an acceptable invoice from Contractor; and (b) the remaining Retainage upon Final Completion as described in Section 4.8.
4.7    Statement.  With each invoice, Contractor shall submit a sworn statement as provided by the mechanics lien law of the state where the Site is located and in the forms attached hereto as Exhibit I, Attachment 1.  The statement shall state the names of all Subcontractors (regardless of tier), the nature of Work, amounts of all Subcontracts, amount paid to date, amount to be paid to complete the Work, amount due, any contracts to be let, amount owed for labor to date, cost of labor to complete the job, and total amount to be paid to complete the Work.
4.8    Final Payment.  Contractor’s final invoice shall be marked “FINAL INVOICE,” and an additional copy of this invoice shall be submitted to Company’s Authorized Representative.  Subject to the fulfillment of Contractor’s obligations under the Contract Documents, final payment of all monies due, but not previously paid to Contractor hereunder, shall be made within 45 Days after receipt by Company of Contractor’s final invoice; subject, however, to the condition precedent that final payment shall not be due until Final Acceptance.  Additionally, on Projects involving the construction of improvements to Company’s property, Contractor shall have given Company evidence satisfactory to Company that all liens, claims, obligations, and liabilities against Company and its premises (including the Project and the Site), or in respect to the Work or chargeable to Company have been fully paid, satisfied, and released.  Such evidence shall include Contractor’s final, unconditional lien waiver (attached hereto in the form of Exhibit I, Attachment 3) for the final cost of the Work performed by Contractor and its Subcontractors.  Acceptance of final payment will constitute a release by Contractor of any and all claims against Company for payment for Work performed pursuant to the Contract Documents.  Payment by Company (including payment of the Retainage) will not constitute acceptance of any non-conforming Work or a waiver of any claims or rights that Company may have in connection therewith.  Following Final Completion, the remaining Retention shall be payable within 45 Days after Company and Contractor have executed a Certificate of Final Acceptance and Company receives the final invoice and lien releases from Contractor.  Amounts held by Company as Retainage will not accrue interest.  Notwithstanding this Section 4.8, Company in its absolute discretion, may pay all or part of the Retention prior to Final Acceptance without waiving any of its rights or remedies hereunder.  In addition, Contractor’s final invoice will have a credit of $250,000 to Company, reducing the amount listed as due and owing by Company.
ARTICLE 5    PROJECT CONTROLS
5.1    Reports.  Contractor shall attend weekly progress meetings and submit to Company a weekly schedule status report dated up to the Day before submission thereof, in such form as shall be specified by Company, showing the progress made by Contractor toward the completion of the Work to the date of each report.  Each report shall include an updated Schedule, a list of Contractor’s and its Subcontractors’ employees performing Work at the Site, a description of Contractor’s planned activities on the Project for the next week, and other matters pertaining to the Work.  Contractor shall continuously monitor, report, forecast, and control the progress of the Work in accordance with the Schedule.  Contractor shall provide increasing scheduling detail as the Work progresses.  If such reporting or forecasting indicates a delay or potential delay, then (a) Contractor will promptly notify Company of the delay, and (b) except to the extent such delay or potential delay was caused by Company or its other contractors, Force Majeure, or site trespass, Contractor shall promptly take appropriate action to get back on schedule and to avoid such delay at no cost to Company.  Contractor’s reporting shall be sufficiently detailed to present to Company an accurate status of the Schedule, variances from the Schedule and reasons therefore, and corrective action planned.  Contractor shall comply with the provisions of Exhibit K (Project Controls) until Final Acceptance.
5.2    Time-and-Material Reports.  If the Work is being performed pursuant to a cost-plus or time-and-material (or any variation thereof) pricing structure, Contractor shall submit a weekly report to Company for each such Project.  Each report shall include, in addition to the information required by Section 5.1 and Exhibit K, the following: (a) time sheets listing Contractor’s and Subcontractor’s employees, with occupation descriptions and number of regular and overtime hours worked; (b) a list of all chargeable tools and equipment showing hours used; and (c) a list of chargeable material and quantities.
ARTICLE 6    INDEPENDENT CONTRACTOR STATUS
Contractor shall be an independent contractor and not an agent, partner, joint venturer, or employee of Company.  Contractor shall perform the Work in accordance with its own means and methods, and the performance of the Work shall remain in Contractor’s exclusive charge and control.  Contractor shall be solely responsible for the terms and conditions of employment for all of its employees working pursuant to this Contract including, but not limited to, their hire, supervision, transfer, termination, wages, withholdings, benefits, insurance, and workers’ compensation.  Nothing in the Contract Documents shall be construed or interpreted to mean that Company is a co-employer, joint employer, or a single employer with Contractor or any Subcontractor (regardless of tier).  In the event Contractor is a party to a collective bargaining agreement, or any other labor agreement or contract covering its employees, Contractor shall be solely responsible for all obligations under those agreements.  This Contract is not exclusive.  Company is free to engage others to supply Materials or Services that is the same or similar to Contractor’s.  Unless otherwise stated in the Contract Documents, Contractor has no authority to act for, represent, or bind Company or its parent company, subsidiaries or Affiliates in any manner.

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ARTICLE 7    CONTRACTOR’S PERSONNEL AND RESPONSIBILITIES
7.1    Labor Relations.  Contractor understands that the use of union labor is at Contractor’s option for the Project, and Contractor acknowledges that is solely responsible for the use of union labor for the Work.  In the performance of any of its union Work, Contractor shall comply with, and shall require its Subcontractors of all tiers at the Site to comply with, the terms of the applicable union agreement.  
7.2    No Strikes or Other Work Stoppages:  All applicable union agreements shall provide that there shall be no work stoppages, work slowdowns or strikes.
7.3    Copies of Union Agreements Furnished to Company.  Contractor and its Subcontractors at the Site shall furnish to Company copies of the applicable union agreements along with written permissions for their use by the affected International Union(s).  Contractor and its Subcontractors at the Site shall also furnish a copy of the site extension approval(s) granted by the International Union(s) prior to commencing the Work.  
7.4    Pre-Job Conferences.  Contractor and its Subcontractors at the Site shall conduct pre-job conferences and assign Work to the appropriate crafts according to the recognized and traditional jurisdiction.  
7.5    Labor Indemnification.  Contractor shall indemnify, hold harmless, and defend Indemnitees from all claims, liability, damages, and expenses (including reasonable attorneys’ fees and court costs) arising out of a labor dispute arising under Contractor’s union or collective bargaining agreements, if such disputes or claims are asserted by employees of either Contractor or a Subcontractor, their bargaining representatives, or employee benefit trust funds except to the extent such disputes or claims are caused by Company or its other contractors. .
7.6    Experienced Employees.  Contractor shall employ and cause each Subcontractor (regardless of tier) to employ, qualified, competent, appropriately trained, experienced, reliable and trustworthy employees to perform the Work.  At Company’s request, the credentials of any of Contractor’s or its Subcontractors’ employees assigned to perform the Work shall be submitted to Company in advance of such assignment.  Contractor shall require all persons performing the Work at Company’s Site to be trained in and to comply with Contractor’s policies, procedures, and directives applicable to activities at Company’s Site, including security, environmental protection, employee health and safety, sexual harassment, access, use of controlled substances, and similar activities.  During the performance of the Work, Company may object to any Contractor employee who, in Company’s reasonable opinion, does not meet these criteria.  In such case, Contractor shall, at its expense and risk, immediately replace or remove such employee.  
7.7    Contractor Responsible for Conduct of Employees.  Contractor shall have full responsibility for the conduct of all employees employed on or in connection with the Work (including employees of any Subcontractor) and will ensure that there is adequate, daily supervision of all Work.  Contractor shall be familiar with and observe established and accepted labor practices, procedures, and project agreements.  Contractor and its Subcontractors shall be responsible for enforcing strict discipline and good order among their employees at all times while on the Site or performing any of the Work.
7.8    Key Personnel.  For the duration of any Project, the employees or other persons whose names appear on the list of Key Personnel contained in Exhibit E are deemed necessary for the successful performance of the Work.  Contractor shall assign such Key Personnel to the performance of the Work and shall not reassign or remove any of them without prior written consent of Company.  Whenever, for any reason, one or more of the Key Personnel specified in Exhibit E is unavailable to perform the Work, Contractor shall, with the prior written approval of Company, replace such person with a person of substantially equal abilities and qualifications.
7.9    Supervisor.  While performing Work at the Site, Contractor shall have, at Company’s Site, a competent supervisor satisfactory to Company who is authorized to act for Contractor, who is qualified for operator qualification and experienced in work of the type specified, and who can act for Contractor and to receive orders or notices which may be given for the proper prosecution of the Work.  
7.10    Employee Fitness.  Contractor’s personnel on any Site shall: (a) report to the Site in a manner fit to do their job; (b) not be under the influence of or in possession of any alcoholic beverage or of any controlled substance (except a controlled substance as prescribed by a physician so long as the performance or safety of the Work is not affected thereby); and (c) not have a discernible adverse impact on Company.  Contractor’s employees shall be advised to these requirements prior to entry on the Site.  Contractor shall immediately remove from the Site any employee in violation of these requirements as determined by the Contractor or Company.  Contractor shall impose these identical requirements on Contractor’s Subcontractors.

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7.11    Former Employees.  Contractor shall identify to Company any person whom Contractor proposes to engage for the Work, and his proposed role, if Contractor knows him to be a former employee of Company.  Company shall have the right and power to then exclude such employee from the Site.
7.12    Duty to Cooperate.  Contractor shall cooperate with all other contractors performing work on behalf of Company, and shall conduct its operations to prevent interference with the work or progress of such contractors.  If any part of the Work is dependent upon the quality and completeness of work performed under another contract, Contractor shall visually inspect the other contractor’s work and promptly report apparent defects therein which render such work unsuitable for the proper execution of the Work.  Failure to report such defects to Company shall constitute the Contractor’s acceptance of such work as suitable to receive the Work.  However, Contractor shall not be responsible for defects which develop after such inspection which could not have been reasonably detected by a visual examination of the work.  The Company will be responsible for coordinating field work among Contractor and Company’s other contractors.  If conflicts arise among Contractor and Company’s other contractors concerning scheduling or coordination, Company will make the final decision resolving the conflict.  
7.13    Field Records.  Contractor shall maintain up-to-date as-built copies of all Drawings, Specifications, and other Contract Documents and supplementary data, including the latest revisions thereto and a continuous record of all field changes.  
7.14    Protection of Property and Public Liability.  Until all of the Work is completed, Contractor shall be responsible for the protection of all persons and all public and private property including known and properly located structures, sewers and utilities, above and below ground.  Contractor shall furnish and maintain any barriers, signs, warning lights, guards or other safety equipment necessary to provide adequate protection of persons and property.  If Contractor has not taken such precautions and, in the opinion of Company, an emergency has arisen requiring immediate action, Company, with or without notice to Contractor, may provide suitable protection at the expense of Contractor.  If such costs are not paid on presentation of the bills therefore they may be deducted from subsequent payments to Contractor.  The performance of such emergency work shall not relieve Contractor of responsibility for any damage which may occur, unless such damage is caused by Company or its contractors, Force Majeure, or site trespass.
7.15    Damage to Existing Property.  To the extent caused by the Contractor, any Subcontractor or their agents, employees or any other person for whom, directly or indirectly, any one of them may be liable, Contractor will be held responsible for any damage to existing known and properly located structures, materials, or equipment because of its operations and shall repair or replace any damaged structures, Work, materials, or equipment to the satisfaction of and at no additional cost to Company.  Contractor shall protect all known and properly located existing structures and property from damage and shall provide bracing, shoring, or other works necessary for protection.
7.16    Rights-Of-Way.  Company will timely obtain all permanent right-of-way and access easements required for performance of the Work.  Contractor shall improve and maintain the access way as required to perform its Work.  The location of access way not provided to Contractor with the bid documents shall be the sole responsibility of Contractor.  Contractor shall confine its operations to the Project area and access ways and shall use due care in placing tools, equipment, excavated materials, and construction materials and supplies, so as to cause the least possible damage to the property.  At the conclusion of the Work, all temporary structures and other facilities incidental to the Work shall be removed and the Site shall be restored to its original condition.
7.17    On Private Property.  Contractor shall comply with all the limitations and provisions of Company’s easements and agreements.  Contractor shall enter proposed rights-of-way only after Company notifies Contractor that easements and/or agreements for the specific area have been obtained.  Problems involving rights-of-way shall be immediately reported to Company.  Contractor shall use existing roads or lanes within the easement area to gain access to the Project area.  Company’s inspector is not empowered to authorize Contractor to depart from property to which Company has acquired rights of entry or occupancy.  In those cases where Contractor, for whatever reason, enters upon, travels across, or otherwise uses privately-owned land beyond the rights acquired by Company in its right-of-way agreements, Contractor shall make all arrangements and agreements with the landowner involved for such right of entry and use of their property.  In such cases Contractor shall make such right of entry available to Company’s inspector, where necessary for performance of inspector’s duties, at no additional cost to Company.  Contractor shall obtain a written agreement from each property owner and tenant setting forth Contractor’s right of entry and use of the property, and a copy of each such agreement shall be filed with Company.

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7.18    Work within Highway and Railroad Rights-of-Way.  All Work performed, and all operations of Contractor, its employees, or Subcontractors within the limits of railroad, road, and highway rights-of-way shall be in conformity with the requirements and be under the control (through Company) of, the railroad, road, or highway authority owning, or having jurisdiction over and control of, the right-of-way in each case.
ARTICLE 8    SUBCONTRACTUAL RELATIONS
8.1    Subcontractual Relations.  Contractor may utilize Subcontractors to perform portions of the Work with the prior written consent of Company, which shall not be unreasonably withheld, conditioned, or delayed.  If Company consents to the subcontracting of any portion of the Work, (a) such consent shall not relieve Contractor of its obligations under these Contract Documents with respect to such Work and (b) Contractor agrees to bring the provisions of these Contract Documents to the attention of and to bind every Subcontractor (regardless of tier) to whom it subcontracts any of the Work by the provisions of these Contract Documents as far as applicable to that portion of the Work to be performed by the Subcontractor.  If Contractor proposes to subcontract any of the Work, it shall submit to Company the name of each proposed Subcontractor, with the proposed scope of the Work to be undertaken, safety documents as defined in the Contractor Safety and Health Program and under applicable Law for any Subcontractor performing Work on Site, and such information about the Subcontractor as Company may reasonably request.  Company may reject any and all proposed Subcontractors in Company’s absolute discretion.  
8.2    Subcontracts.  Any portion of the Work to be performed for Contractor by a Subcontractor shall be performed pursuant to an appropriate written Subcontract between Contractor and the Subcontractor.  No Subcontract shall relieve Contractor of its obligations under the Contract Documents.  Contractor shall remain responsible for all subcontracted Work, and Contractor shall be as fully liable to Company for acts and omissions of its Subcontractors, their agents, representatives, and persons directly or indirectly employed by them as it is for the acts and omissions of Contractor’s own employees.
8.3    No Privity with Subcontractors.  Any reference herein to Subcontractors, including the description of how Subcontracts may be authorized by Company or requiring Contractor to incorporate a provision hereof in agreements with its Subcontractors, agents or assigns, shall not create privity of contract between Company and such Subcontractor or their agents or assigns.
8.4    Assignment of Subcontracts.  Each Subcontract shall provide for a contingent assignment of the Subcontract upon termination for cause of Contractor by Company.  Such contingent assignment shall provide that if Company fulfills Contractor’s obligations to Subcontractor, then Subcontractor will perform the Subcontract on behalf of Company, its successors and assigns.
8.5    Contractor’s Payments to Subcontractors.  Contractor shall pay each Subcontractor promptly upon receipt of payment from Company or as provided in the Subcontract.  Company has no obligation to pay Subcontractors or to ensure Contractor pays Subcontractors.  Contractor shall furnish to Company satisfactory evidence of all payments.  Company may withhold any amounts due to Contractor or its Subcontractors in addition to any other monies that are to be retained, until such evidence is furnished.  Contractor shall not permit any Lien to be put or remain on property of Company by reason of the failure of Contractor or its Subcontractor to pay for labor and materials, except to the extent caused by Company’s failure to pay Contractor undisputed amounts due.  If any such Lien is not removed within 60 Days of a notice of lien claim, Company may do so at Contractor’s expense, and Contractor shall promptly pay to Company all such costs and expenses, including legal fees, paid or incurred by Company, unless Contractor has bonded over the lien with an appropriate mechanic’s lien bond that meets the statutory requirements of the state where the lien is asserted.    
8.6    Disputes with Subcontractors.  Contractor shall promptly inform Company of any significant dispute arising between Contractor and any of its Subcontractors.  Contractor shall use its best efforts to avoid disputes regarding the Work and shall resolve such disputes as they arise.  
8.7    Compliance with Applicable Law.  Contractor shall cause any and all of its Subcontractors to comply with all applicable Law in the performance of the Work hereunder.
ARTICLE 9    INSURANCE
9.1    Required Coverages.  Contractor shall provide and maintain, and shall require each Subcontractor (regardless of tier) to provide and maintain, in effect during the performance of any Work under these Contract Documents the insurances described herein.  The following insurance policies will be underwritten by insurance companies that are satisfactory to Company, that have a current A.M. Best Co. rating of A-, financial category X or higher, and that are authorized to do business in the states where the Work is performed.  Such policies will include:

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(a)    Workers’ Compensation.  The legal liability under the Workers’ Compensation Act of the states where the Work is performed and any other employee benefit statute or law of such states, to pay claims for personal injuries sustained by its employees, including death resulting therefrom.  With respect to employer’s liability coverage under any workers’ compensation insurance policy, the limit of liability shall be $2,000,000 per Accident – Injury, $2,000,000 Policy Limit – Disease, and $2,000,000 per Employee – Disease.  The workers’ compensation policy shall also include U.S. Longshoremen and Harbor Workers’ Compensation Act Coverage, if any Work shall be done over or within 100 feet of any body of water, or otherwise at the sole discretion of Company.  It shall also provide maritime (Jones Act) coverage if a boat or vessel of any type is to be used.
(b)    Commercial General Liability.  Commercial general liability insurance covering the legal liability of Contractor for injuries to or death of any person or persons and damage to the property of others.  This coverage must contain either blanket contractual liability coverage or contractual liability coverage specific to this Contract, either of which shall not be subject to a contractual limitation endorsement.  The limits of liability will be not less than $25,000,000 per occurrence and $25,000,000 annual aggregate, other than products/completed operations.  This policy must be written on an “occurrence” basis.  This coverage cannot be subject to any exclusion or limitation for “explosion”, “collapse”, or “underground” (a/k/a “XCU”) operations.
(c)    Commercial Automobile Liability.  The legal liability of Contractor for bodily injuries and damage to the property of others arising out of the ownership, maintenance or use of any motor vehicle by Contractor or its Affiliates or their respective representatives and either blanket contractual liability coverage, or contractual liability coverage specific to this Contract, either of which shall not be subject to a contractual limitation endorsement.  The limits of liability will be not less than $25,000,000 per occurrence and $25,000,000 annual aggregate.  Coverage shall apply to owned, rented or leased, and non-owned vehicles. 
(d)    Pollution Legal Liability Insurance.  Contractor’s pollution legal liability insurance with coverage for (a) bodily injury, sickness, disease, mental anguish or shock sustained by any person, including death; (b) property damage, including physical injury to or destruction of tangible property, including the resulting loss of use thereof, clean-up costs, and the loss of use of tangible property that has not been physically injured or destroyed; and (c) defense, including costs, charges and expenses incurred in the investigation, adjustment or defense of claims for such compensatory damages; for losses caused by pollution conditions that arise from the Work.  The limits of liability will be not less than $10,000,000 per occurrence or claim and $10,000,000 annual aggregate.  
(e)    Professional Liability.  The legal liability of Contractor for professional errors and omissions, including coverage for bodily injury and property damage.  The limits of liability will be not less than: $5,000,000 per claim or occurrence and $5,000,000 annual aggregate.  
(f)    Umbrella/Excess Liability Insurance.  Any part of the required limits for employer’s liability, commercial general liability, commercial automobile liability, and Pollution Liability may be provided by an umbrella or excess liability policy.  
9.2    Claims Made Coverage.  If any policy is written on a “claims made” basis, then either (a) Contractor must maintain the policy for a period of two years following termination of this Contract or (b) the policy must contain an “extended reporting provision” for a period of at least two years.
9.3    Evidence of Insurance.  Except with respect to workers’ compensation / employer’s liability coverage, all of the foregoing policies must: (a) provide a waiver of subrogation against Company and its Affiliates; (b) except with respect to professional liability coverage, include Company and its Affiliates as additional insured parties under broad form coverage for completed and ongoing operations (either CG 20 10 11 85 or both of CG 20 10 10 01 and CG 20 37 10 01); (c) be on a primary basis in relation to any Company policy, which will be non-contributing; and (c) except with respect to professional liability coverage, contain either contractual liability coverage specific to this Contract or blanket contractual liability coverage, neither of which will be subject to a contractual limitation endorsement.  Except with respect to workers’ compensation / employer’s liability coverage, Contractor, on behalf of its insurers, waives any right of subrogation that such insurers may have against Company arising out of this Contract.
9.4    Notice of Cancellation.  Contractor will notify Company of any cancellation or material amendment to any policy, including any reduction in coverages or erosion of aggregates, at least 30 Days prior to the effective date thereof.  No later than execution of this Contract, Contractor will furnish a certificate of insurance, indicating the required coverage and endorsements.  

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9.5    Self-Insured Retention.  All self-insured retentions or deductibles are the sole responsibility of Contractor.  Company’s acceptance of any insurance certificate will not constitute acceptance of the adequacy of coverage or compliance with the requirements of this Contract.  
9.6    Additional Coverages.  No more than once every 12 months, Company may request, and Contractor will furnish within 30 Days thereafter, additional or increased insurance coverages from Contractor.  If at the time of Company’s request, Contractor does not have such additional or increased insurance coverage, Contractor will notify Company and upon Company’s consent, procure such coverage and charge the cost of such coverage to Company.  If Company does not consent, then Contractor will have no obligation to procure such coverages that it does not then have.  Any additional premium accrued by such changes shall be submitted to Company for payment.
9.7    Non-Waiver.  Failure of Contractor to provide insurance as herein required or failure of Company to require evidence of insurance or to notify Contractor of any breach by Contractor of the requirements of this Article 9 shall not be deemed to be a waiver by Company of any of the terms of this Contract, nor shall they be deemed to be a waiver of the obligation of Contractor to defend, indemnify, and hold harmless Company as required herein.  The obligation to procure and maintain any insurance required is a separate responsibility of Contractor and independent of the duty to furnish a copy or certificate of such insurance policies.  Company may inspect all policies of insurance at any time. 
9.8    Company’s Right to Purchase.  Upon any failure by Contractor to comply with the insurance requirements of this Contract, Company may, without in any way compromising or waiving any right or remedy at law or in equity, upon five Days’ written notice to Contractor, purchase such insurance, at Contractor’s expense, provided that Company shall have no obligation to do so, and, if Company shall do so, Contractor shall not be relieved of or excused from the obligation to obtain and maintain such insurance amounts and coverages.  All such costs incurred by Company shall be promptly reimbursed by Contractor or may be withheld from any payment due Contractor.
9.9    Accident/Incident Report.  Contractor shall promptly furnish Company with copies of any non-privileged accident/incident reports sent to Contractor’s insurance carriers covering accidents or incidents occurring in connection with or as a result of the performance of the Work or its receipt or notice of any claim by a third party, or any occurrence that might give rise to such a claim.  
9.10    Contractor Obligations Not Limited.  None of the requirements contained herein as to types, limits, or Company’s approval of insurance coverage to be maintained by Contractor are intended to and shall not in any manner limit, qualify, or quantify the liabilities and obligations assumed by Contractor under this Contract, any other agreement with Company, or otherwise provided by Law.
ARTICLE 10    INDEMNIFICATION
10.1    Standard Indemnity. To the fullest extent permitted by Law, for all Losses up to the specific limits of insurance set forth in Section 9.1, Contractor shall defend, indemnify and hold harmless Company and its Affiliates and their respective officers, directors, employees, agents, representatives, successors, and assigns (collectively, the “Indemnitees”) from and against any Losses, including Losses relating to personal injuries, death, damage to property, damage to the environment, or infringement of any intellectual property right to the extent caused by the negligence or willful misconduct of Contractor, any Subcontractor or their agents, employees or any other person for whom, directly or indirectly, any one of them may be liable and in any way, occurring, incident to, arising out of, or in connection with (a) the Work, unless the foregoing result solely from the negligence or willful misconduct of the Indemnitees or (b) Contractor’s breach of any of its obligations under the Contract Documents.  
10.2    Excess Indemnity.  To the fullest extent permitted by Law, for claims in excess of the specific limits of insurance set forth in Section 9.1, Contractor shall defend, indemnify and hold harmless the Indemnitees from and against any Losses, including Losses relating to personal injuries, death, damage to property, damage to the environment, or infringement of any intellectual property right to the extent caused by the negligence or willful misconduct of Contractor, any Subcontractor or their agents, employees or any other person for whom, directly or indirectly, any one of them may be liable and in any way, occurring, incident to, arising out of, or in connection with (a) the Work or (b) Contractor’s breach of any of its obligations under the Contract Documents.  
10.3    Generally.  The existence or availability of Workers’ Compensation insurance does not relieve Contractor of the obligation to indemnify pursuant to this Article 10.  The indemnity obligations do not negate, abridge, or otherwise reduce any other right or obligation of indemnity or contribution which exists in favor of the Indemnitees.  These indemnities shall also inure to the benefit of any third-party person suffering Losses, so that such person shall have a direct cause of action against Contractor hereunder.  The policies of liability insurance required by this Contract shall include Contractor’s liability under this Article 10 for Losses occurring in the future.  

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ARTICLE 11    WARRANTIES
11.1    Warranties.  Contractor warrants that all Work shall be performed by qualified personnel in a competent manner in conformance with the warranties herein and that the Work will comply with, if applicable, any specifications contained in these Contract Documents. Contractor further warrants that the Services will be properly performed in accordance with the applicable industry standards and practices then prevailing at the time of these Contract Documents, or, if higher, at the time such Services are performed.  If industry standards and practices conflict with Company requirements, Contractor shall notify Company’s Authorized Representative who will determine and memorialize in writing which requirements will apply.  Contractor warrants that any material or equipment furnished to Company hereunder (a) will be of new manufacture and will be free from defects in design, workmanship and materials, (b) will be in compliance, and will have been manufactured and sold in accordance, with all applicable laws, and (c) will have been fully tested to meet the requirements of these Contract Documents.  Contractor further warrants that the Material will comply with the Specifications provided to Contractor and will comply with all performance requirements, tolerations and representations provided to Contractor.  Contractor agrees that it will obtain and assign or otherwise provide to Company the benefits of any warranties provided by manufacturers or suppliers of material or equipment incorporated into the Material and will perform its responsibilities so that such warranties remain in full force and effect.  The warranties of Contractor set forth in this Agreement shall expire upon expiration of the Callback Period.
11.2    Remedies.  If any of the Work does not comply with the foregoing warranties and Company notifies Contractor of the noncompliance of the Work during the Callback Period, Contractor shall (at its sole expense) promptly repair, replace, or re-perform the nonconforming Work.  All costs and expenses associated with access to or repair or replacement of any Material, including all transportation costs, shall be paid by Contractor, and Company may charge Contractor all expenses of unpacking, examining, repacking and reshipping any rejected Material.  All re-performed Work shall be performed on a schedule to be agreed upon by Company.  The Callback Period for any such re-performed Work shall be extended to one year from the date of such re-performance.  If Contractor fails to prosecute the Work properly or to perform any of its other obligations under these Contract Documents, Company, after notice to Contractor, and without prejudice to any other remedy it has, may make good the deficiencies and charge Contractor all such costs (including the costs directly attributable to other services that are required to be performed in connection with the correction of such deficiencies, the cost of additional legal or engineering expense, access, repair, reinstallation, and salvage costs and testing expense) and a 12% administrative fee.  If any Latent Defect becomes apparent within the 12-month period following expiration of the Callback Period, Company shall as promptly as practical so notify Contractor, and Contractor shall correct such Latent Defect promptly after receiving such notice, by re-supplying or replacing the Material at Contractor’s expense, notwithstanding any expiration of the Callback Period.  The warranties set forth in this Article 11 are provided by Contractor in lieu of all other warranties available at law or equity and whether express or implied, including all warranties of merchantability or fitness for a particular purpose, all such warranties being hereby expressly disclaimed.
11.3    Inspection.  Company’s inspection, testing, acceptance, payment, or use of any Material or Services shall not affect the warranties and obligations of Contractor under the Contract Documents, and such warranties and obligations shall survive any such inspection, testing, acceptance, payment, or use.
ARTICLE 12    RISK OF LOSS AND TITLE
12.1    Contractor’s Risk.  Except as set forth in this Section 12.1, risk of loss or damage to the Work or any property of Company in the custody of Contractor shall remain with Contractor until Final Acceptance.  If any loss of or damage to the Work occurs prior to Final Acceptance, Contractor shall, at its sole expense, promptly repair or replace the portion of the Work affected, provided however, that Contractor shall not bear the risk of loss and shall have no obligation to repair or replace Work lost or damaged by Company or Company’s other contractors, Force Majeure, or site trespass.
12.2    Warranty of Title.  Contractor warrants that it is authorized to perform the Work contemplated by the Contract Documents and it is qualified to furnish services constituting or comprised in the Work.  Contractor warrants that it has good and merchantable title to all of the Material.  Title to any Material furnished by Contractor shall pass to Company upon delivery to the Project Site or, to the extent of the payments made for such Material by Company, on the date that Company makes such payments, whichever occurs first.  

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ARTICLE 13    SITE CONDITIONS
13.1    Site Investigations.  Contractor shall have satisfied itself as to the nature and location of the Work, the general and local Site conditions, the transportation and handling of Material, the environmental and physical conditions at the Site, the character of the Material, facilities, Company-Furnished Items attached as Exhibit O, labor conditions, safety and security precautions, and all matters which may affect performance of the Work and Contractor’s price prior to beginning any Work.  
13.2    Site Conditions.  Within two Business Days of discovery and before any such conditions are disturbed, Contractor shall notify Company in writing of (a) latent physical conditions at the Site differing materially from those indicated in the Contract Documents or (b) unknown physical conditions at the Site that are of an unusual nature, and differing from those ordinarily encountered and generally recognized as inherent in work of the character provided for in this Contract.  Company shall promptly investigate the conditions.  If such conditions do materially differ and were previously unknown and should not have been anticipated by using prudent industry practices and that such conditions increase the time or the cost of Contractor to complete the Work, Contractor shall have the right to seek, pursuant to the Change Order provisions of the Agreement, an equitable adjustment in the Contract Price or the Schedule.  Contractor shall have no right, power or authority to bring any claim under this Section 13.2, if Contractor fails to notify Company as required or if such claim is asserted after final payment is made under the Contract Documents.
ARTICLE 14    MATERIAL PROVISIONS
14.1    Material Supply (Specifications).  All Material shall be supplied in accordance with the provisions of Exhibit A.  Material and major assemblies shall be supplied completely factory assembled, unless the physical size, arrangement or configuration of the Material, or shipping and handling limitations make the shipment of complete assemblies impracticable.  Packing slips with Company and Project identifying numbers noted must be included in all shipments and the last shipment must state “Final Shipment.”  Contractor shall manufacture only sufficiently in advance of the Schedule to meet deliveries required by such Schedule and in the event of termination of the Project or change in the Work, no claim will be allowed for manufacture or procurement in advance of such Schedule.
14.2    Minor Defects.  Contractor shall readjust, straighten, and repair minor defects and fabrication errors which are normally encountered in Company-Furnished Items. When field labor is needed to correct significant errors in Company-Furnished Items, Contractor shall furnish such labor where so requested by the manufacturer or by Company with the consent of the manufacturer, and Contractor shall be entitled to seek a Change Order for such work.
14.3    Routing of Shipments; Shipping.  Contractor shall supply the Material “F.O.B. destination”.  Company may designate its preferred mode of shipment, including specifying the type of vehicle or trailer that Contractor may use to deliver the Material.  Company may route all shipments of Material or any part thereof.  If freight is included in the price of the Material and Company’s routing would increase Contractor’s transportation costs, Contractor shall notify Company of such fact before shipment.  If Company still specifies the more expensive route, Company shall reimburse Contractor for the amount of the difference between the less expensive and more expensive transportation costs.  If, however, Contractor fails to timely notify Company of the increased costs, Contractor shall pay for the additional transportation costs.  Contractor shall wrap, pack, crate, load, enclose, and brace the Material on the carrier in a good, workmanlike manner and in accordance with applicable standard trade practice.  
14.4    Receiving, Handling, and Storage.  Contractor shall receive from carriers at the job site, check, unload, handle, and store all materials and equipment which are to be incorporated in the Work.  If Material is in storage at a Company facility or other designated location, Contractor shall be responsible for loading at such location, transporting to job Site and unloading.  Contractor shall become responsible for all Company-Furnished Items upon delivery to Contractor, and Contractor shall thereafter be responsible for the loss or damage to the material except to the extent caused by Company, its contractors, Force Majeure, or site trespass.  All unused Company–Furnished Items shall be returned by Contractor to Company in accordance with the directions of Company’s engineer.  Any material lost or damaged by Contractor shall be replaced at Contractor’s expense.
14.5    Contractor’s Duty to Check.  Contractor must check all dimensions, elevations, and quantities indicated on the Drawings and Specification.  Contractor must notify Company of any discrepancies between the Drawings and Specifications and the conditions at the Site, or any error or omission in the Drawings or Specifications, or in the layout as given by stakes, points, or instructions that may be discovered in the course of supplying the Material.  Contractor shall not be allowed to take advantage of any error or omission in the Drawings, Specifications, or other Contract Documents.  Company will furnish full instructions should such error or omission be discovered, subject to Contractor’s right to seek a Change Order or to dispute Company’s determination.  

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14.6    Specifications and Drawings.  The Specifications and Drawings are intended to supplement but not necessarily duplicate each other.  Any Work exhibited in the one and not in the other shall be executed as if it had been set forth in both, so that the Work will be performed according to the complete design as determined by Company.  Should anything necessary for a clear understanding of the Work be omitted from the Specifications and Drawings, or should the requirements appear to be in conflict, Contractor shall secure written instructions from Company before proceeding with the Work affected thereby.  It is understood and agreed that the Work must be performed according to the true intent of the Contract Documents, as determined by Company.
ARTICLE 15    TESTS AND INSPECTIONS
15.1    Company’s Attendance.  Both Contractor and Company have the right to be represented at any tests required under the Contract Documents and to receive copies of any resulting data.  Company shall not be deemed to have accepted the Work or any portion thereof to be so tested prior to the satisfactory completion of tests proving that the Work or such portion thereof is in all respects as represented and as required by the Contract Documents.  Reasonable notice of the time and place of each proposed test shall be given by the testing Party to the other in order to permit both to be present or represented thereat.  If such tests show the Work not to be as represented or as required by the Contract Documents, Company may, without risk or liability to it, reject the Work, and Contractor shall promptly modify the Work as necessary and re-perform the tests at its own expense, until the Work is as represented and required.
15.2    Company Inspections.  Company may, at all reasonable times, inspect the Work in process and the facilities where the Work is being performed.  Such inspections, if made, shall not in any way relieve Contractor from its obligations under the Contract Documents.  If Company elects to make any inspection, it shall notify Contractor in advance to permit it to make appropriate arrangements.  If any inspection or test is made by Company on the premises of Contractor or a Subcontractor, Contractor shall provide, and cause its Subcontractor to provide, all reasonable facilities and assistance for the safety and convenience of Company or its representatives in the performance of their duties at no cost or expense to Company.  Company reserves the right to hire a third party to inspect, review and comment on Contractor’s Work.   
15.3    Rejected Work.  If Company determines that any of the Work does not comply with the Contract Documents, Company may reject it (with or without instructions as to its removal) or require it to be corrected at Contractor’s expense.  If Contractor fails to promptly remove or correct the Work as specified by Company, Company may (a) by another contractor or otherwise, remove or correct the Work and charge to Contractor the cost of such removal or correction, or (b) terminate Contractor for default as provided in Article 25.  Unless Contractor corrects or removes such Work promptly or, if Company directs otherwise, within Schedule, Company  may equitably reduce the Contract Price for the Work.  Contractor, upon written notice from Company, shall remove all Work rejected as defective or failing to conform to the requirements of the Contract Documents.  Contractor shall, at its sole expense, restore all work damaged by such removal, shall promptly replace materials damaged or improperly worked by it and re-execute its own work In accordance with the Contract Documents.  This shall include restoration of the Work of any other contractor affected by removal of defective Work.  If Contractor does not remove rejected Work within the time specified in the notice, Company may do so and replace such Work at the expense of Contractor.
15.4    Timing.  Company will inspect and accept or reject the Work as promptly as practicable after delivery, except as otherwise provided in the Contract Documents, but its failure to inspect and accept or reject the Work shall not relieve Contractor from responsibility for Work which does not comply with the Contract Documents or impose liability upon Company therefore.
15.5    Covering the Work.  Company may order inspection of questioned Work at any time, and if so ordered, the Contractor must uncover that Work.  If that Work is in accordance with the Contract Documents, Company shall pay the cost of re-examination and recovering.  If that Work is not in accordance with the Contract Documents, then Contractor shall remedy such nonconforming Work at Contractor’s expense.
15.6    Final Inspection.  Contractor shall notify Company when, in its opinion, the Work (including all submittals, data, tests and all other requirements under the Contract Documents) is complete.  Company shall inspect the Work and notify Contractor in writing (a) that the Work is satisfactory and is acceptable to Company or (b) of the parts of the Work do not conform to the Contract Documents.  Contractor shall correct such non-conforming Work to suit Company’s schedule, at Contractor’s sole expense.
ARTICLE 16    COMPANY’S USE OF THE WORK 
16.1    Company’s Use.  Company shall have the complete and unrestricted right to take possession, and use portions, of the Work before it is completed.  Any such possession or use shall not be deemed an approval or acceptance of any of the Work or portion thereof which does not conform with, or a release of Contractor from any of its obligations under, the Contract Documents.  With respect to any Work used by Company prior to Final Acceptance, the Callback Period for such Work shall commence on the earlier of (a) 60 days after Guaranteed Substantial Completion Date or (b) the first day the pipeline commences commercial operation by opening the valve for gas flow.

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16.2    Submittals.  Any submittals or Drawings required by the Contract Documents to be submitted to Company for review shall be submitted by Contractor without unreasonable delay and any Work affected thereby started prior to written acceptance by Company shall be at Contractor’s risk.  Submittals and Drawings shall not be deemed to have been “submitted” unless Company deems that such submittals or Drawings are complete, contain all required data and details, and comply with the industry standards or standards of care applicable to such submittals or Drawings.  All submittals or Drawings provided by Contractor may be used by Company in connection with the installation, startup, maintenance, operation, and repair of the Work and may be transferred to any transferee of the Work.  Review by Company shall not relieve Contractor from fulfilling all of Contractor’s obligations under the Contract Documents, including obligations relating to design and detailing, nor shall it be deemed as an acceptance by Company of any defective Work or Defective Services by Contractor.  As far as practicable, each submittal or Drawing shall bear a cross-reference note referring to the sheet number or numbers of Company’s Drawings or Specifications showing the same Work.
ARTICLE 17    SITE SAFETY AND SECURITY
17.1    Site Safety.  Contractor agrees to initiate and comply with the Contractor Safety and Health Program which serve as the minimum safety requirements for the Site.  Contractor agrees to fully advise all of its employees, agents, Subcontractors, and others working for Contractor at the Site, of the contents of the Contractor Safety and Health Program and all necessary environmental, safety, and health procedures required by Company and applicable Law.  Contractor shall be responsible for Project safety with respect to Contractor’s Work.  Contractor and its Subcontractors shall develop a safety program at least as stringent as Contractor Safety and Health Program.  Contractor shall review and monitor the safety programs of Subcontractors to confirm that such safety programs are consistent with Contractor Safety and Health Program and applicable Law.  Further, Contractor shall continuously inspect the Work to identify any unsafe conditions and shall promptly take action to correct any condition that is unsafe.  Contractor warrants that it is able to perform the Work hereunder and that it is familiar with and knowledgeable about all Law to the extent necessary to carry out its duties hereunder in a safe and competent manner.  Upon notice of non-compliance with any of the Site safety requirements, Contractor shall immediately cease the Work in the affected area and shall bear all costs until the unsafe conditions are corrected.  Contractor shall not be entitled to an extension of time, additional compensation, or damages by reason of or in connection with such cessation of the Work.
17.2    Security Regulations.  Contractor shall comply with Company’s security regulations in effect at any time governing the admittance of Contractor’s employees to the Site and their identification while there.  Each person entering or leaving the Site is subject to a search of their effects, their vehicles, and themselves in accordance with Company’s security regulations.  Contractor shall advise its personnel of Company’s security regulations and its right of search and shall obtain from its personnel informed consents to such searches.  Contractor shall furnish and install all necessary facilities to provide safe means of access to all locations where Work is being performed, and will have two security personnel at the Site each Day and shall, under no circumstance have any obligation to provide more than two security personnel each day.  Company will have the right to have its own site security personnel at the Site, but in no event will Company be liable for the safety or security of Contractor’s personnel, representatives, or equipment.  
17.3    Reporting.  Contractor shall immediately report to Company any accident, incident, injury, illness, or unusual occurrence during performance of the Work at the Site, including personal injury or death to any individual or any damage to any of Company’s property, the Site, or adjacent property.  Contractor shall submit a copy of all non-privileged accident reports to Company’s Authorized Representative within 24 hours after an accident.
17.4    Emergencies.  In any emergency affecting the safety of persons or property on a Project, Contractor shall act, at its reasonable discretion, to prevent threatened damage, injury, or loss.  Any extension to the Schedule or request for an adjustment of the Contract Price claimed by Contractor on account of emergency work shall be subject to the terms of Article 23 and documented in a request for an appropriate Change Order.
17.5    Cleanliness.  Contractor shall at all times keep the job Site clean and cause trash, debris, and rejected and waste materials to be removed from the Site and disposed of.  Upon completion of the Work, all Contractor-owned facilities, materials, and equipment shall be removed from the Site.  All surfaces damaged by deposits of foreign materials such as oil, grease, weld spatter, and paint shall be restored to their original conditions.  If Contractor fails to do so, Company’ may perform such work at Contractor’s expense.
17.6    Site Trespass.  In the event of a work stoppage caused by a planned or unplanned protest or trespass, the Contractor shall notify Company within one hour of the work stoppage and follow the trespass protocol identified in Exhibit Q (Trespass Protocol).  Contractor shall, and Company reserves the right to, temporarily relocate Contractor’s workforce elsewhere on the Project.  Any such relocation will be considered a crew move-around.   Any Contractor stand-by time associated with a crew move-around for a planned or unplanned work stoppage caused by a protest or trespass will be considered crew stand-by time, and Contractor has a right to seek a Change Order for the costs related to such stand-by time, which, if approved by Company, will be paid in accordance with the provisions of Article 17, Exhibit C, and Exhibit P, Appendix P-1 (Labor and Equipment Rates) as applicable.  

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ARTICLE 18    ENVIRONMENTAL REQUIREMENTS
18.1    Hazardous Substances Brought or Used by Contractor.  Contractor will remove, transport, and dispose of at its cost any Hazardous Substances: (a) transported or released onto the Site or on off-site rights of way and easements by Contractor or any Subcontractor, but not any Company Hazardous Substances released onto the Site unless such release of Company Hazardous Substances was caused or exacerbated in whole or in part by Contractor’s negligence or willful misconduct or (b) used as part of Contractor’s or any Subcontractor’s work at the Site.  As required under Federal Hazardous Communications Standards and certain state and local Laws, Contractor shall maintain Material Safety Data Sheets covering all Hazardous Substances furnished under, brought on the Site under, or otherwise associated with, the Work under this Contract and provide them prior to or at the time Hazardous Substances are delivered to or otherwise brought on the Site.  If Contractor does not bring any hazardous materials on the Site, Contractor shall provide Company with copies of a document certifying that no Material Safety Data Sheets are required under any Laws in effect at the Site.
18.2    Pre-Existing Hazardous Substances.  Company’s existing facilities (which include the land on which the Work will be performed) may contain Hazardous Substances not brought to the Site or used by Contractor or its Subcontractors (“Company’s Hazardous Substances”).  Should Contractor or any of its Subcontractors encounter or have reason to believe that Company’s Hazardous Substances are present while performing Work, Contractor must immediately notify Company.  Contractor shall take the necessary precautions to prevent disturbing Company’s Hazardous Substances adjacent to the Work.  If the Work cannot be continued without disturbing or exposing such material, Contractor shall stop Work in the immediate vicinity.
18.3    Investigation and Determination.  Contractor will notify Company if Contractor has reason to believe that it has encountered Company’s Hazardous Substances, Company will investigate the material and determine whether Hazardous Substances requiring removal or abatement exist.  If Company’s Hazardous Substances requiring removal or abatement are not present, Contractor shall immediately resume any of its operations that have been stopped.
18.4    Plan for Removal or Abatement. Unless otherwise identified in the Contract Documents or where Contractor, using prudent industry practices, should have knowledge of the condition, the discovery of Company’s Hazardous Substances is a differing site condition under Article 13.  Contractor shall have no responsibility for the containment, removal, abatement, clean up or remediation of any Company’s Hazardous Substances encountered in performance of the Work.  Contractor will provide Company with all documentation related to the condition in Contractor’s possession or as required by applicable Laws for Company’s removal and disposal of Hazardous Substances.
18.5    Contractor Chemical Use and Disposal Requirements.  Contractor shall not bring chemicals on Company’s property without the prior approval by Company.  Any chemicals not on Company’s approved list must be submitted for review,  written approval, and addition to Company’s approved list.  Company will be listed as the generator for any chemicals on the Company’s approval list.  If Contractor uses any chemicals that are not on the approved list, all waste generated becomes the sole responsibility of Contractor and the waste must carry Contractor’s applicable EPA and applicable state identification number as the generator.  Contractor shall obtain temporary identification numbers from the applicable regulatory agency before disposal.  Hazardous Substance shall not be disposed without prior consent of Company’s Environmental Compliance Department.  All handling and storage of Hazard Substances must meet all applicable federal and state regulations.  Excess chemicals or waste shall not be left on site at the completion of the job without the permission of Company.  Contractor will contact Company within 24 hours (or immediately if required by environmental Law) via Company’s environmental hotline (314-575-5077), and will provide subsequent notification to Company in writing on or before 72 hours, after becoming aware of any actual or alleged violation or noncompliance with any environmental Law in connection with the Work, including any release or disturbance of Hazardous Substances.  
18.6    Notice.  All notifications regarding environmental Law or requirements shall be given promptly to Company’s Authorized Representative.  Contractor shall provide written notice of the presence of all Hazardous Substances found on or brought to the Site by Contractor or its Subcontractors to local fire, medical, and law enforcement agencies as required by Laws with a copy of such notice to Company. 
18.7    Inclusion in Subcontracts.  The substance of this Article 18 shall be included in all Subcontracts issued by Contractor for Work performed at the Site.

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18.8    Material Safety Data Sheets Required.  As required under Federal Hazardous Communications Standards and certain state and local Laws, Contractor shall maintain Material Safety Data Sheets covering all Hazardous Substances furnished under, brought on the Site under, or otherwise associated with, the Work under this Contract and provide them prior to or at the time Hazardous Substances are delivered to or otherwise brought on the Site.  If Contractor does not bring any hazardous materials on the Site, Contractor shall provide Company with copies of a document certifying that no Material Safety Data Sheets are required under any Laws in effect at the Site. 
18.9    Labeling and Training.  The Contractor shall provide labeling of Hazardous Substances and training of their employees in the safe usage of such materials as required under any applicable Laws.   
ARTICLE 19    DRUGS AND ALCOHOL
All Contractor and Subcontractor personnel, including administrative and supervisory employees, shall be subject to alcohol and substance abuse screening while at any Company location.  Contractor will not be reimbursed for employee or Subcontractor lost time for drug testing.  Consideration will be given to keep Project disruption to a minimum.  Contractor shall immediately remove, and deny access to Company’s Site to, any employee or principal of Contractor or Subcontractors who violates or can be reasonably suspected by Contractor of violating the policy adopted by Contractor to conform with this Article 19, for such time as required by Contractor’s drug and alcohol policy.  For all Contractor personnel removed from Site, Contractor shall provide all information and documentation necessary for Company’s security records.
ARTICLE 20    TAXES
Unless otherwise set forth in the Contract Documents or unless otherwise required by Law, all applicable taxes (including all applicable federal, state and local net or gross income or gross receipt taxes and all use and similar taxes) are included in the Contract Price set forth in these Contract Documents, and Company shall not be required or obligated to reimburse Contractor for any taxes or similar expenses which may arise or be incurred in connection with these Contract Documents.  Where applicable, Company shall furnish a copy of its direct payment permit, a tax exemption certificate, or similar evidence of exemption with respect to any such tax, and in such event Contractor shall not bill or otherwise charge Company for such taxes.  Contractor shall be solely liable for any taxes and contributions for unemployment insurance, old age retirement benefits, life pensions, annuities and similar benefits, which may now or hereafter be imposed by Law or collective bargaining agreements with respect to persons employed by Contractor to perform the Work.
ARTICLE 21    LIENS
21.1    Lien Waivers.  For Projects involving the construction of improvements to Company’s property, as a condition precedent to payment, Contractor shall submit with each invoice an conditional partial lien waiver (attached hereto in the form of Exhibit I, Attachment 2) for the amount requested in the current invoice as well as, if applicable, lien waivers from its Subcontractors for the preceding payment.  Both Contractor and its Subcontractors shall provide Company a final lien waiver as a condition precedent to payment by Company of the final invoice.  Both the partial lien waivers and the final lien waiver shall become enforceable upon issuance of payment by Company.  
21.2    Lien Free Projects.  Provided that Company has made all undisputed payments for the applicable portion of the Work that are due and owing pursuant to this Agreement, Contractor agrees to keep Company’s property free and clear of, and shall promptly release or cause the release of, all liens, lien claims, recorded notices, claims for nonpayment, or lis pendens filed of record by any Subcontractor (regardless of tier).  Provided that Company has made all undisputed payments for the applicable portion of the Work that are due and owing pursuant to this Agreement, Contractor agrees to indemnify and hold Company harmless from all liens and lien claims made, recorded, asserted, or filed on the Work or on any property on which it is being performed, on account of any labor performed or Material furnished by Contractor, Subcontractors (regardless of tier) and other persons in connection with the Work.  Provided that Company has made all undisputed payments for the applicable portion of the Work that are due and owing pursuant to this Agreement, Contractor further agrees to keep Company, Material, the Work, the Site, and any fund from which construction costs are to be paid free and clear of all liens and lien claims arising from the performance of any of the Work covered by this Agreement.  Contractor’s obligation hereunder includes paying for any attorneys’ fees, court, and other costs incurred by Company in connection with any such lien or lien claims.
21.3    Right to Discharge Liens.  Should any lien or lien claim prohibited in this Article 21 be so asserted, whether due to nonpayment of the claimant or otherwise, unless contested by Contractor in good-faith, Company may at its sole discretion and without limiting or waiving any rights or remedies of any other interested person: (a) pay the amount of such lien or lien claim either directly to the claimant or by issuance of joint payment to Contractor and the claimant; (b) retain from payments then due or which thereafter become due to Contractor, whether under the Contract Documents or otherwise, an amount sufficient to discharge the claimed amount 

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and to hold Company harmless from any cost, expense, Losses, or damage incurred in connection with the claim, including reasonable attorneys’ fees, expenses and court costs; (c) require Contractor to obtain and record a properly executed release of lien satisfactory to Company; or (d) require Contractor to execute a title indemnity agreement acceptable to Company or to record a properly executed bond (provided by a surety acceptable to Company) in the minimum amount of one and one-half times the amount of the recorded lien or lien claim or such other greater amount as may be required by Company.  This obligation shall survive early termination of this Contract or Final Completion of the Work or any component thereof.
ARTICLE 22    AUDIT AND RECORDS
Contractor shall keep accurate and complete Account Records showing compliance with the Law and showing all charges, disbursements, expenses, Subcontractor charges, and evidence of unit pricing quantities in connection with the Work.  Unless otherwise required by Law, Contractor shall preserve such Account Records for at least three years after, as applicable, Final Acceptance or termination of the Contractor.  Except for Account Records (including Subcontractor Charges) showing detail of fixed or lump sum pricing or the build-up of unit pricing, Account Records shall be available at all reasonable times for inspection, audit, or reproduction by Company, its representative, or designee or appropriate governmental bodies without additional cost to Company.  Account Records showing detail of fixed or lump sum pricing or the build-up of unit pricing shall be available at all reasonable times for inspection, audit, or reproduction by appropriate governmental bodies without additional cost to Company, and such Account Records shall be provided to a requesting governmental body as soon as reasonably practical or as requested by such governmental body.  For any portion of the Work performed or any payments made, on a cost reimbursable, time and material, or labor hour basis, or similar model, such Account Records will be available for Company review at reasonable times and shall also include reasonable detailed evidence of such charges, including, where applicable, hourly logs and individual expenses.  
ARTICLE 23    CHANGE ORDERS
23.1    Changes in the Work.  Company has the right to order changes to be made in the Work.  Contractor will not be entitled to any additional compensation for any out-of-scope Work performed prior to the execution of a Change Order by both Company and Contractor.  If changes requested by Company affect the scope of the Work to be performed, Contractor’s costs, or the Schedule, Contractor will be entitled to seek an equitable adjustment in the Contract Price and/or Schedule through a Change Order the form of which is attached hereto as Exhibit P.  Any claim by Contractor for adjustment shall be deemed waived unless made in writing within ten Days after receipt by Contractor of notice of such change request.  Unless agreed by Company in writing, all requests for payments made pursuant to a Change Order shall be submitted by Contractor in invoices separately from the amounts due pursuant to the scope of Work as originally specified in these Contract Documents.  All invoices covering additions or credits to these Contract Documents shall refer to the specific change order or similar written authorization issued by Company with respect to the addition or credit and will not be honored unless this reference is included.  
(a)    If the changes requested by Company do not involve extra cost, Contractor will not be entitled to additional compensation.  If the changes requested by Company reduce in any way the Work, Contractor will not be entitled to any claim for lost profits or other damages and Company will be entitled to a credit against the Contract Price in an equitable amount, but subject to allowance to Contractor for its actual costs incurred for the purchase, rental, delivery and subsequent disposal of materials and equipment required for use in performance of the Work but not used due to the Change Order and not used by Company.
(b)    If the changes requested by Company increase the Work to be performed, such increase shall be paid for by Company as evidenced by a mutually signed Change Order as determined by Company and Contractor in one of the following methods, either: (i) by agreed unit price, (ii) by agreed lump sum, or (iii) only when the additional Work cannot be clearly identified or estimated or when directed by Company pursuant to Section 23.1(c).
(c)    Company may require Contractor to perform the Change Order Work based on the actual direct costs reasonably and prudently incurred or estimated to be incurred in the performance of the changed Work by Contractor including markup for G&A plus 12%.  In no event shall the rates used by Contractor in pricing any Change Order Work exceed the rates set forth in Exhibit C (Unit Pricing) or Exhibit P, Appendix P-1 (Labor and Equipment Rates), as identified in the applicable Change Order.  Contractor shall not be permitted to additional markup on any costs incurred by Contractor’s Affiliates or subsidiaries.  Contractor shall submit a detailed cost breakdown including manhours by craft or discipline, quantities of material, equipment and other applicable costs. Owner shall have access to Change Order pricing and all related cost buildups for submitted Change Orders. 

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23.2    Contractor Change Requests.  If Contractor would like to seek a Change Order, Contractor must give Company written notice within five Days after Contractor’s knowledge of the occurrence of the event giving rise to such request.  Within five Days of any such notice, Contractor shall provide Company with an appropriate statement setting forth the reasons why Contractor believes additional compensation or additional time should be granted and include the nature of any costs to be incurred, including reasonable adjustment to other applicable Contract provisions, and if Contractor is seeking additional time, an analysis of the prospective delay to the Critical Path of the Work (a “Contractor Change Request”).  The impact to the Critical Path shall be measured against Contractor’s completion date as stated on its updated Schedule current at the time the impact occurs.  Any Change Order granting Contractor additional time shall adjust the Guaranteed Substantial Completion Date.  If Company accepts any such Contractor Change Request, a Change Order shall be executed by the Parties and the Contract Price or Project Schedule, or both, as the case may be, shall be adjusted in accordance with the terms of such Change Order.  If Company rejects a Contractor Change Request, no Change Order will be executed, subject to Contractor’s right to dispute the rejection, while continuing to perform the Work.
23.3    No Change Order for Contractor Delay or Error.  To the extent the delay or suspension of the Work causes a delay to the Critical Path of the Project Schedule and is caused by Contractor or any Subcontractor, no adjustment will be made to the Contract Price or Project Schedule, and Contractor shall propose a recovery plan acceptable to Company.  Excess costs for such work will be Contractor’s responsibility.  Further, no Change Order shall be issued and no increase to the Contract Price or adjustment to the Project Schedule shall be made in connection with any correction of errors, omissions, deficiencies, or improper or Defective Work on the part of Contractor or any Subcontractors in the performance of the Work.
23.4    Duty to Continue the Work.  If, within ten Days after a Contractor Change Request or changes requested by Company, Company and Contractor are unable to agree upon an acceptable adjustment in the Project Schedule and acceptable changes in the Contract Price, then Contractor shall proceed with the Work following Company’s written direction to do so; provided, that, (a) with respect to a Contractor Change Request, Company reserves its rights to dispute any claims of Contractor and (b) with respect to Company requested changes, Contractor reserves its right to seek a Change Order but in the interim will be paid at the costs set forth in Section 23.1(c).  
23.5    Effect of Changes in the Law.  The Contract Price is based on applicable Laws in effect as of the Effective Date as well as those enacted or adopted by not yet in full force and effect as of the Effective Date.  After the Effective Date, if a change occurs to any Laws that affects performance of the Work by Contractor, or any Subcontractor, Contractor shall comply with such changed Laws.  Contractor may be entitled to an equitable adjustment for the impact of any changed Laws. 
ARTICLE 24    DELAY, ACCELERATION
24.1    No Extension of Final Completion Date. Except to the extent caused by Company, its contractors, Force Majeure or site trespass, if there is any delay such that the Guaranteed Substantial Completion Date is not reasonably likely to be met, at any time during the execution and completion of any portion of the Work, then Contractor shall employ additional personnel and material as are necessary to accelerate the progress of the Work to meet the Milestone Dates, including the Guaranteed Substantial Completion Date and the Final Completion Date identified in the Contract Documents.  Subject to the provisions of the Contract Documents, Company will not pay, and Contractor shall bear, Contractor’s increased costs related to Contractor’s accelerated performance.  Subject to the terms of the Contract Documents, Contractor acknowledges and agrees that no extension to the Final Completion Date shall be granted unless agreed to in writing by Company and Contractor.  If Contractor fails to meet the Guaranteed Substantial Completion Date, it will be subject to the liquidated damages detailed in Exhibit N. 
24.2    Acceleration Ordered by Company.  If Contractor is failing to perform the Work in accordance with the Schedule, then Company may, in its sole discretion, direct Contractor to accelerate the Work by employing additional personnel and material, by providing overtime to existing personnel as is necessary to complete the Work by the Milestone Dates, by using expedited or express shipping, or by any other means necessary.  Any additional costs associated with the acceleration ordered by Company shall be at Contractor’s expense.
24.3    Extension of Time.  Upon any delay caused by Company, its contractors, Force Majeure, or site trespass, the date of delivery or performance shall be extended for a period equal to the time lost by reason of such delay.  Subject to the provisions of Article 23, upon any delay caused by Company or its contractors, the Contract Price shall be adjusted so that the Company pays Contractor all of Contractor’s actual direct costs caused by such Company-caused delay.  Subject to the provisions of Article 23, upon any delay caused by Force Majeure, the Contract Price shall also be adjusted so that Company pays Contractor fifty percent (50%) of Contractor’s actual direct costs during the Force Majeure delay period.  The term “Force Majeure”  means any extraordinary acts, events, or occurrences that are beyond the reasonable control of, not caused by the fault, negligence or willful misconduct of, and could not be anticipated or foreseen by Company or Contractor, including acts of God, earthquakes, floods, tornado, tidal wave, damage from lightning, fire, quarantine, blockade, governmental acts (other than the time periods associated with obtaining approvals necessary from governmental agencies), court orders or injunctions, war (declared or not), rebellion, terrorism (foreign and domestic), riots, insurrection or civil strife, 

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sabotage, or explosions.  A Force Majeure delay does not include: (a) strikes, work stoppages or other labor dispute including those where such strikes, work stoppages or other labor dispute are related to a local, national or regional strike, or those caused (in whole or in part) by: (i) breaches of any collective bargaining agreement by Contractor or any of its Subcontractors, (ii) actions of Contractor toward Company’s personnel, or Company’s contractors’ personnel, or (iii) unfair labor practices of Contractor; (b) Contractor or its Subcontractors’ inability to obtain labor or to pay monies due and owing to any third party or Subcontractor; (c) actions, inactions or non-performance on the part of Subcontractors; (d) the inability of Contractor to secure labor to perform the Work; (e) weather conditions other than those specifically listed herein; or (f) any event the impact of which Contractor claims is two Days or less and the impact does not affect activities on the Critical Path.  Both Parties shall be prompt in restoring normal conditions, establishing new schedules and resuming operations as soon as the event causing the failure or delay has ceased.  Contractor shall promptly notify Company of any delay and its effect on the Work and must demonstrate to Company that Contractor has used all reasonable means to minimize the delay.  Contractor’s inability or refusal to supply sufficient labor, equipment, or material to complete the Work shall not be excused hereunder.
ARTICLE 25    COMMENCEMENT, DELAY, TERMINATION AND SUSPENSION  
25.1    Early Commencement.  Company may request that Contractor accelerate either or both of the HDD Mobilization Date or Construction Mobilization Date.  Working together with Company, Contractor will use commercially reasonable efforts in good faith to meet Company’s early commencement request, in whole or in part, to the extent Contractor and its Subcontractors have capacity to do so.  Any changes to the HDD Mobilization Date or Construction Mobilization Date will be set forth in a Change Order executed by Company and Contractor.   
25.2    Commencement.  Contractor will not mobilize for any Work prior to, as applicable, the HDD Mobilization Date or, with respect to the Construction Mobilization Date, the expiration of any Delay Periods elected by Company; unless, in each case, Company authorizes Contractor to do so.  Once Contractor mobilizes for applicable Work, Contractor will diligently pursue and perform such applicable Work. 
25.3    Delayed Commencement.  Company will have the right to delay the Construction Mobilization Date by payment of a standby fee for up to seven delay periods (each, a “Delay Period”) as described in the following table:

	
									
	 
	Period Length
	Total Delay
	Period Delay Fee
	Total Delay Fee

	1st Delay Period
	15 Days
	15 Days
	$
	1,000,000
	

	$
	1,000,000
	

	2nd Delay Period
	15 Days
	30 Days
	750,000
	

	$
	1,750,000
	

	3rd Delay Period
	15 Days
	45 Days
	$
	750,000
	

	$
	2,500,000
	

	4th Delay Period
	15 Days
	60 Days
	$
	850,000
	

	$
	3,350,000
	

	5th Delay Period
	15 Days
	75 Days
	$
	950,000
	

	$
	4,300,000
	

	6th Delay Period
	15 Days
	90 Days
	$
	950,000
	

	$
	5,250,000
	

	7th Delay Period
	15 Days
	105 Days
	$
	950,000
	

	$
	6,200,000
	

For any delay to the scheduled commencement of mainline work (meaning the commencement of locate and pothole activities by Contractor) past August 1, Contractor will have the right to seek a Change Order for any seasonal impacts resulting from the delay upon Contractor documenting the seasonal impacts and the Project Schedule, Milestone Dates, and Guaranteed Substantial Completion Date shall be extended to account for the delay.
If Company delays the Construction Mobilization Date and the HDD Mobilization Date, and if, as a result, the HDD Mobilization Date would occur before the Construction Mobilization Date, then the HDD Mobilization Date will be correspondingly delayed to occur on the same day as the Construction Mobilization Date.
25.4    Contractor’s Termination due to Delay.   Contractor will have the right by written notice to Company to terminate this Agreement without liability, unless otherwise provided herein, after the expiration of the 6th Delay Period, but the standby fee owed to Contractor will be limited to $4,900,000 regardless of when Contractor terminates.  In addition to the standby fee, Company will owe Contractor for the value of the Work completed as of the termination date.  But, any amounts owed to Contractor will be netted against any advance payments received by Contractor, which could require Contractor reimburse Company.      
25.5    Termination with Cause.  If (a) Contractor fails to perform the Work at the time specified, or (b) Contractor breaches any other provision of these Contract Documents and if the breach is not cured within ten Days of delivery of notice of such breach, then Contractor shall be in default hereunder and Company may elect to terminate these Contract Documents, or to continue these Contract Documents subject to receiving adequate assurances of performance from Contractor.  Although Company shall use reasonable 

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efforts to mitigate the cost for completion of the Work, Company may employ any person, firm, or corporation to finish the Work by whatever method Company may deem expedient and may undertake such expenditures as in Company’s sole judgment will best accomplish the timely completion of the Work (including, where necessary, the entry into agreements without prior solicitation of proposals). On termination for cause, Company shall not be required to make any payments to Contractor with respect to Work that has not been performed as of the date of termination. If the cost to Company of completing the Work, including costs of accelerated or expedited construction methods customarily and actually performed in an attempt to mitigate any delay by Contractor and reasonable charges for administering any subcontract and for legal fees associated with the termination exceeds the Contract Price, then Contractor shall be liable for the amount of such excess.  Company shall be entitled to offset any such excess costs against any amount due Contractor for Work performed prior to termination.  Company shall not be required to make any payments to Contractor with respect to Work that has not been performed as of the date of early termination, including anticipated overhead or profit for Work not performed by Contractor, and any amounts owed to Contractor will be netted against any advance payments received by Contractor, which could require Contractor reimburse Company.
25.6    Termination or Suspension without Cause.  Subject to Section 25.2, Company may at any time on three Days’ notice to Contractor extend, suspend, or delay Contractor’s performance or terminate these Contract Documents for Company’s convenience.  Any compensation payable to Contractor through the effective date of early termination shall be prorated, based solely on the value of the Work completed, and Company shall not be required to make any payments to Contractor with respect to Work that has not been performed as of the date of early termination, including anticipated overhead or profit for Work not performed by Contractor, and any amounts owed to Contractor will be netted against any advance payments received by Contractor, which could require Contractor reimburse Company.  Company shall also pay Contractor for all actual, direct costs incurred by Contractor as a result of the suspension or termination without cause, including the costs of demobilization, cancelling supply (provided that Company has approved all Subcontractor cancellation fees prior to the execution of the Subcontract), and subcontract agreements, committed materials, and rental and lease fees.
25.7    Resumption of Work.  If Company extends, delays or suspends Contractor’s performance Contractor shall thereafter resume its performance as soon as is practicable when directed to do so by Company.  Any dates for performance by Contractor which are affected by an extension, delay or suspension of Company, together with any payment schedules in these Contract Documents, shall be extended for a period not to exceed the time lost by reason of the extension, suspension or delay.
ARTICLE 26    CLAIMS
If Contractor has any claim, including claims for equitable adjustment, against Company, such as for extra work, changes, or delays, notice of each such claim shall be submitted in writing to Company.  Any claim by Contractor shall be deemed waived unless made in writing within ten Days after the occurrence of the event that precipitated the claim.  The submission of any claim or dispute shall include a concise statement of the question or issue in dispute, together with relevant facts and documentation to fully support the claim.  Company will consider no claim for additional compensation for work outside of Contractor’s scope of Work, unless Contractor has followed the procedures enumerated in Article 23.
ARTICLE 27    DISPUTE RESOLUTION
27.1    Mediation.  If any dispute arising out of or relating to this Contract is not resolved by executives of both Parties at levels at least one level above the Project personnel who have previously been involved in the dispute, such dispute shall be submitted to mediation to any one of the following mutually agreed to mediators American Arbitration Association (AAA), JAMS, or any mutually agreed to mediator.  Any and all disputes arising out of or relating to this Contract shall be subject to mediation as a condition precedent to litigation.  The mediation shall be administered at the mediator’s office location closest to the location of the Project.  The mediation session shall take place at a location mutually agreed to by the Parties.  If the mediation process has not resolved the dispute within 30 Days after the mediation session, or such longer period to which the Parties may agree, the mediation process shall cease.  If the mediation process has not resolved the dispute within 30 Days of the submission of the matter to mediation or a longer time if agreed to by the Parties, then either one of the Parties may file a complaint, subject to the provisions of Section 31.5.  All negotiations pursuant to this clause are confidential and shall be treated as compromise and settlement negotiations for purpose of the Federal Rules of Evidence and state rules of evidence.  Each Party will bear its own costs for this dispute resolution phase, including splitting the cost of the mediator. 
27.2    Work to Continue.  In the case of any dispute (including any dispute which is or may be the subject of mediation or litigation), Contractor shall continue to perform the Work pending final determination of the dispute, and Company shall continue to make payments to Contractor for those portions of the Work completed that are not the subject of dispute, in accordance with the Contract Documents.

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ARTICLE 28    DELIVERY AND RETENTION OF DOCUMENTATION
28.1    Documentation and Proprietary Information.  Company shall not be prohibited from disclosure or use of proprietary or confidential information or documents relating to the Work which are required by Company in order to permit Company to obtain the full benefits of the Work.  If Company transmits any information to Contractor which Company considers proprietary, Company may so designate such information.  Contractor shall use that information, and any other information that Contractor knows or has reason to know is proprietary or confidential to Company, exclusively in connection with the Work and shall not publish or otherwise disclose it to any third party.
28.2    Documentation.  Contractor shall provide Company with all information and documentation (which includes Drawings (including any as-built Drawings), Specifications, reports, and designs) within Contractor’s scope of Work and which is required by Company for the design, construction, licensing, quality assurance, safety, operation, bidding, or maintenance of the Work or of the facility for which the Work is intended.  Such documentation shall include, if applicable, Documents containing the original equipment manufacturer make, model or part number, drawings, specifications, manuals or instructions for any Material.  Contractor shall promptly provide to Company all such information and other materials relating to the Work that Company may request in connection with any filing or other submission Company is making with any regulatory or other governmental body.  Contractor may disclose all such information to such regulatory and other governmental body as required by Law.  Contractor shall notify Company’s Authorized Representative immediately upon such request and in advance of such disclosure.  In addition, Contractor shall cooperate with Company as requested by Company with respect to such filings or submissions.
28.3    Retention of Documents.  Unless otherwise required by Law, Contractor agrees to retain and maintain (at no additional cost to Company) at least one record set of all documents obtained or generated in the course of performing the Work for a period of three years from the date of the completion of the Work.  Contractor, at the end of the three-year period, shall notify Company if Contractor intends to destroy the documents.  If Company requests that some or all of the documents be preserved for an additional reasonable period of time, Contractor shall comply with Company’s request, but has the option to return the documents to Company for retention.  Any request by Contractor to destroy such documents shall be in writing and sent to Company at the address for notices.  
ARTICLE 29    CONFIDENTIAL INFORMATION
29.1    Contractor’s Obligations.  During the term of this Contract and thereafter, except as Company may authorize in writing, Contractor shall, and shall cause its employees and Subcontractors to:  (a) treat and cause to be treated as confidential all Confidential Information, as designated by Company; (b) not disclose any Confidential Information to any third party or make available any reports, recommendations, or conclusions based on the Confidential Information to any third party without Company’s prior written approval; (c) reveal the Confidential Information only to those employees and Subcontractors of Contractor who require such access in order to perform the Work hereunder; (d) if requested by Company, grant access to Confidential Information only to employees of Contractor or its Subcontractors who have signed a confidentiality agreement; (e) use Confidential Information only in connection with performing the Work pursuant to the Contract Documents; (f) make copies of any tangible embodiment of Confidential Information only as necessary for performing the Work; (g) remove any tangible embodiment of Confidential Information from the Site of Company only with the express permission of Company; and (h) return any or all tangible embodiments of Confidential Information to Company promptly following the request of Company, and in any event upon completion of performing the Work pursuant to the Contract Documents.  Contractor may disclose all such information to such regulatory and other governmental body as required by Law.  Contractor shall notify Company’s Authorized Representative immediately upon such request and in advance of such disclosure.
29.2    Irreparable Harm.  Contractor acknowledges that the breach of any of the covenants contained in this Article 29 or Article 30 will result in irreparable harm and continuing damages to Company and Company’s business, and that Company’s remedy at law for any such breach or threatened breach would be inadequate.  Accordingly, in addition to such remedies as may be available to Company at law or in equity in the event of any such breach, any court of competent jurisdiction may issue an injunction (both preliminary and permanent), without bond, enjoining and restricting the breach or threatened breach of any such covenant, including, but not limited to, an injunction restraining Contractor from disclosing, in whole or in part, any Confidential Information.  Contractor agrees that it will not have the power to raise the issue of adequate remedy at law as a defense to any action by Company for an injunction to prevent any disclosure by Contractor of Confidential Information.  Contractor shall pay all of Company’s costs and expenses, including reasonable attorneys’ fees and accountants’ fees, incurred in enforcing such covenants.  The obligations of this Article 29 shall survive any termination of this Contract.

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ARTICLE 30    OWNERSHIP OF WORK PRODUCT
30.1    Work Product.  Any and all products of the Work performed by Contractor, any Subcontractor and any of their employees under the Contract Documents, including all inventions, discoveries, formulas, processes, devices, methods, compositions, compilations, outlines, notes, reports, system plans, flow charts, source codes, and other forms of computer software including computer modeling, algorithms, procedures, policies, data, documentation, and other materials or information which Contractor, any Subcontractor or any of their employees may conceive, invent, author, create, reduce to practice, construct, compile, develop, or improve in the course of performing the Work or otherwise delivered to Company as part of the Work (collectively, “Work Product”) shall be the sole and exclusive property of Company from and after the time it is created.  Contractor agrees to promptly disclose to Company the existence of any Work Product of which Company would not otherwise be aware upon its creation.
30.2    Assignment.  Contractor agrees to assign and hereby does assign to Company (together with its successors and assigns) the sole and exclusive right, title, and interest in all Work Product, including any and all related patent, copyright, trademark, trade secret, and other property or proprietary rights of any nature whatsoever.  Contractor warrants and agrees to execute and deliver to Company, and Contractor agrees to cause its Subcontractors and the employees of Contractor and Subcontractors to execute and deliver to Company, any and all documents that Company may reasonably request to convey to Company any interest Contractor, its Subcontractors or any of their employees may have in any Work Product or that are otherwise necessary to protect and perfect Company’s interest in any Work Product.  Contractor further warrants and agrees to take, and Contractor agrees to cause Contractor’s employees to take, such other actions as Company may reasonably request to protect and perfect Company’s interest in any Work Product.  Contractor further agrees that the sums paid to Contractor by Company in connection with Contractor’s performing of the Work serve, in part, as full consideration for the foregoing assignment, and that said consideration is fair and reasonable, and was bargained for by Contractor.  Contractor represents and warrants that it has full right, power, and authority to grant the assignment granted under this Section 30.2.
30.3    Contractor’s Retained Information.  In the event and to the extent that any Work Product contains or requires for its use any items, elements, or components that were developed or otherwise acquired by Contractor prior to the Effective Date or not in the course of performing the Work (“Contractor’s Retained Information”), Contractor shall identify such Contractor’s Retained Information to Company in writing.  Contractor hereby grants to Company an irrevocable, perpetual, non-exclusive, royalty-free, world-wide license to (a) use, reproduce, perform, and execute the Contractor’s Retained Information, (b) prepare derivative works based upon the Contractor’s Retained Information, (c) distribute copies of Contractor’s Retained Information and of derivative works based upon Contractor’s Retained Information; and (d) authorize others to do any of the foregoing, but for each only to the extent required for the operation and maintenance of the Work by Company.  Contractor represents and warrants that Company will not be liable for any royalties or other fees for any patent, license, or other intellectual property right covering any materials, articles, apparatuses, devices, equipment, or processes used by Contractor in the performance of the Work or in the Work itself.
30.4    Knowledge.  Nothing in this Article 30 should be construed to prohibit Contractor from using its skills, knowledge, and experience that have a general applicability, including such skills, knowledge, or experience gained by Contractor in connection with performing Work for Company (collectively, the “Knowledge”) in performing work for other clients; provided, however, that the Knowledge or Contractor’s use thereof shall not include any Confidential Information of Company.
30.5    Use of Work Product.  Contractor agrees not to use any Work Product, including any Drawings, Specifications, reports, or any unique design aspects of a Project in any other project without the prior written approval of Company.  
ARTICLE 31    MISCELLANEOUS
31.1    Complete Agreement of the Parties.  The Contract Documents set forth the entire understanding of the Parties, and supersede any and all prior agreements, arrangements, or understandings, relating to the subject matter hereof.  
31.2    Notices.  Any notice to Company pertaining to the Work performed shall be in writing and delivered personally or sent by facsimile, by nationally recognized express-type courier service requiring delivery receipts, or postage prepaid by U.S. Mail, return receipt requested to Company’s Authorized Representative.  Any notice to Contractor pertaining to the Work shall be in writing and delivered personally or sent by facsimile, by nationally recognized express-type courier service requiring delivery receipts, or postage prepaid by U.S. Mail, return receipt requested to Contractor’s Authorized Representative.  Notices shall be effective only when received.  All notices required or permitted under this Contract will be deemed given and made (a) if by personal delivery, on the Business Day of such delivery, (b) if by delivery by facsimile, on the Business Day sent if sent before 5:00 pm Central Time on a Business Day or if sent after that time, on the next Business Day (as evidenced by confirmation of transmission by the transmitting equipment), (c) if by nationally recognized overnight courier, on the next Business Day following deposit and (d) if by certified mail, return receipt requested, postage prepaid, on the third Business Day following such mailing, in each case addressed at the address or facsimile number set forth at the end of this Contract, or such other address as may be designated by notice by, such party.

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31.3    No Third-Party Beneficiary.  No provision of this Contract is intended or shall be construed to be for the benefit of any third party (other than the Indemnitees).
31.4    Assignment.  Contractor shall not assign or transfer any rights, claims, interests, or obligations in the Contract Documents including claims for monies that are due or may be due, without the prior written consent of Company, which consent may not be unreasonably withheld by Company.  Company may assign its rights, claims, interests, and obligations in the Contract Documents to a third party upon notice to Contractor.  This Contract binds and inures to the benefit of the Parties and their respective successors and permitted assigns.  
31.5    Choice of Law/Interpretation.  The Contract Documents shall be construed and interpreted, without giving effect to principles of conflict of law, in accordance with the laws of the State of Missouri.  The provisions of the Contract Documents shall be interpreted where possible in a manner to sustain their legality and enforceability.  Any dispute or proceeding between the Parties arising out of the Contract Documents must be commenced and maintained exclusively in the state or federal courts having jurisdiction over St. Louis County, Missouri, and each Party submits itself unconditionally and irrevocably to the personal jurisdiction of such courts.  EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION, CLAIM, OR PROCEEDING RELATING TO THE CONTRACT DOCUMENTS.
31.6    Severability.  Should any provision of the Contract Documents be held unenforceable in law such provision shall be severed from the Contract Documents, and the balance of this Contract shall be binding on both Parties as if the severed provision had never existed, unless performance of the Contract Documents is thereby rendered legally impractical or no longer fulfills Company’s objectives.  
31.7    Amendments.  This Contract cannot be amended or modified in any way except by a writing signed by an authorized representative of Company and Contractor.  No course of prior dealing, usage of trade, and course of performance shall be used to modify, supplement, or explain any terms of this Contract.  No waiver of any provision of this Contract shall be binding on Company unless set forth in a writing signed by an authorized representative of Company.
31.8    Non-Waiver.  The failure of Company to insist upon strict performance by Contractor or Company’s failure or delay in exercising a “course of dealing” or any rights or remedies provided in this Contract or by the Law shall not be deemed or construed as a waiver by Company of any claims or of the right by Company to enforce such or any other provision in the future.  No waiver by Company of a breach of any provision of the Contract Documents shall constitute or be construed as a waiver of any other breach or of that provision.  No partial or final payment, Certificate of Final Acceptance, or the acceptance of any portion of the Work shall be construed as (a) an acceptance of defective Work, (b) relieving Contractor of its obligations to make good any defects or consequences for which Contractor may be responsible, or (c) a waiver of any breach or other obligations of Contractor under the Contract Documents.  No waiver shall be binding upon Company unless it is in writing and signed by Company.  Any written waiver shall apply only to the specific default or to the instance specified, and a waiver of any default shall not be deemed a waiver of any other default, whether or not similar to the default waived.
31.9    Liability Limitation.  Company’s and Contractor’s liability in connection with the Contract Documents to each other and their respective Affiliates and their respective representatives will not exceed $25,000,000, in any action or claim whether statutory or in contract, tort or otherwise; provided, however, that this limitation shall not apply to any claims arising out of: (a) willful misconduct or gross negligence; (b) third-party indemnity claims; (c) fines, fees and corresponding Losses due to failure to comply with Law; (d) breach of confidentiality or intellectual property obligations; and (e) Company’s failure to pay Contractor any payable portion of the Contract Price.   
31.10    Waiver of Consequential Damages.  Except for Losses that arise out of: (a) willful misconduct or gross negligence; (b) third-party indemnity claims; (c) fines, fees and corresponding Losses due to failure to comply with Law; and (d) breach of confidentiality or intellectual property obligations, neither Party will have any liability to the other Party for any all consequential, incidental, indirect, punitive, or special Loss arising out of or relating to this Agreement of any kind or character, whether arising in warranty, tort (including negligence), contract, strict liability, professional liability, or otherwise, and including loss of use, income, profits (including anticipated profits arising directly from Work not performed as a result of  termination), revenue, product, business opportunity, financing, business and reputation, or contract.    

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31.11    Interpretation.  The singular includes the plural, and vice versa.  The term “includes” and its derivative expressions mean “includes, but is not limited to” and the corresponding derivative expressions.  Unless set forth expressly otherwise, the term “Section” means a section of this Contract.  Unless paired with the word “either”, the term “or” is inclusive and not exclusive.  The term “year” refers to the calendar year.  The captions and section headings set forth in this Contract are for convenience only.  Nothing in this Contract can be construed against either Party as the alleged drafter thereof.  Except as specifically set forth to the contrary in this Contract, the rights and remedies described in this Contract are not exclusive, are cumulative or (to the extent applicable) alternative, and are in addition to other rights or remedies available at Law or in equity or otherwise.  Company will have the right to offset any amounts owed to Contractor by any amounts reasonably determined by Company to be owed by Contractor to Company.  Reference to the standards of any technical society, organization, or association, or to codes of local or state authorities, shall mean the latest version or tentative standard adopted and published at the date of issuance of proposals, unless stated otherwise.
31.12    Non-Exclusive.  This Contract does not restrict Company from bidding, awarding, or having other contractors or Company employees installing or replacing gas facilities of any size, number or location. Company reserves the right to award a contract to more than one contractor.
31.13    Survival.  The obligations contained in Section 3.4 (Compliance with Applicable Law), Article 4 (Invoicing and Payment), Article 10 (Indemnification), Article 11 (Warranties), Article 20 (Taxes), Article 22 (Audit and Records), Article 25 (Termination and Suspension), Article 28 (Delivery and Retention of Documentation), Article 29 (Confidential Information), Article 30 (Ownership of Work Product), Section 31.2 (Notices), Section 31.9 (Liability Limitation), and Section 31.10 (Waiver of Consequential Damages) will survive expiration or any termination of this Contract. 
IN WITNESS WHEREOF, the Parties have executed this Contract as of the day and year first above written.
	
			
	SPIRE STL PIPELINE LLC
	 
	MICHELS CORPORATION

	 
	 
	 

	By:   /s/ Michael C. Geiselhart      
Name:   Michael C. Geiselhart
Title:   President
	 
	By:  /s/ Matthew J. Westphal       
Name:   Matthew J. Westphal
Title:   Vice President - Pipeline Operations

	
			
	Address for Notices issued pursuant to this Contract.
If to Company:
Spire STL Pipeline LLC
Attn: President
700 Market Street
St. Louis, MO 63101
Fax No.: 314-421-1979

with a copy (which will not constitute notice) to:
Spire STL Pipeline LLC
Attn:  General Counsel
700 Market Street
St. Louis, MO 63101
Email: legalnotices@spireenergy.com

	 
	Address for Notices issued pursuant to this Contract.
If to Contractor:
Michels Corporation
817 W. Main Street
Brownsville, WI 53006-0128
Attn:   Matthew J. Westphal
Fax No.:   
E-Mail: 

with a copy to:
Michels Corporation
Attn: Chris Dombrowicki
817 W. Main Street
Brownsville, WI  53006-1028
E-Mail: 

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