NANOSPHERE, INC. Common Stock UNDERWRITING AGREEMENT
Exhibit
1.1
7,000,000
NANOSPHERE, INC.
Common Stock
[•], 2007
Credit Suisse Securities (USA) LLC,
As Representative of the Several Underwriters,
Eleven Madison Avenue
New York, N.Y. 10010-3629
As Representative of the Several Underwriters,
Eleven Madison Avenue
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Nanosphere, Inc., a Delaware corporation (“Company”), agrees with the
several Underwriters named in Schedule A hereto (“Underwriters”) to issue and sell to the several
Underwriters 7,000,000 shares (“Firm Securities”) of its Common Stock, par value $0.01 per share
(“Securities”) and also proposes to issue and sell to the Underwriters, at the option of the
Underwriters, an aggregate of not more than 1,050,000 additional shares (“Optional Securities”) of
its Securities as set forth below. The Firm Securities and the Optional Securities are herein
collectively called the “Offered Securities”. As part of the offering contemplated by this
Agreement, Credit Suisse Securities (USA) LLC (the “Designated Underwriter") has agreed to reserve
out of the Firm Securities purchased by it under this Agreement, up to 350,000 shares, for sale to
the Company’s directors, officers, employees and other parties associated with the Company
(collectively, “Participants"), as set forth in the Final Prospectus (as defined herein) under the
heading “Underwriting” (the “Directed Share Program"). The Firm Securities to be sold by the
Designated Underwriter pursuant to the Directed Share Program (the “Directed Shares") will be sold
by the Designated Underwriter pursuant to this Agreement at the public offering price. Any Directed
Shares not subscribed for by the end of the business day on which this Agreement is executed will
be offered to the public by the Underwriters as set forth in the Final Prospectus. As part of the
offering contemplated by this Agreement, the Underwriters have agreed to reserve [•] shares of the
Firm Securities (the “Brookside Securities”) for offer and sale to Brookside Capital Partners Fund,
L.P. (“Brookside”) upon the terms and subject to the conditions set forth in this Agreement.
2. Representations and Warranties of the Company. The Company represents and warrants to,
and agrees with, the several Underwriters that:
(a) Filing and Effectiveness of Registration Statement; Certain Defined Terms.
The Company has filed with the Commission a registration statement on Form S-1 (No.
333-145356) covering the registration of the Offered Securities under the Act, including
a related preliminary prospectus or prospectuses. At any particular time, this initial
registration statement, in the form then on file with the Commission, including all
information contained in the registration statement (if any) pursuant to Rule 462(b) and
then deemed to be a part of the initial registration statement, and all 430A Information
and all 430C Information, that in any case has not then been superseded or modified,
shall be referred to as the “Initial Registration Statement”. The Company may also have
filed, or may file with the Commission, a Rule 462(b) registration statement covering
the registration of Offered Securities. At any particular
time, this Rule 462(b) registration statement, in the form then on file with the
Commission, including the contents of the Initial Registration Statement incorporated by
reference therein and including all 430A Information and all 430C Information, that in
any case has not then been superseded or modified, shall be referred to as the
“Additional Registration Statement”.
As of the time of execution and delivery of this Agreement, the Initial
Registration Statement has been declared effective under the Act and is not proposed to
be amended. Any Additional Registration Statement has or will become effective upon
filing with the Commission pursuant to Rule 462(b) and is not proposed to be amended.
The Offered Securities all have been or will be duly registered under the Act pursuant
to the Initial Registration Statement and, if applicable, the Additional Registration
Statement.
For purposes of this Agreement:
“430A Information”, with respect to any registration statement, means information
included in a prospectus and retroactively deemed to be a part of such registration
statement pursuant to Rule 430A(b).
“430C Information”, with respect to any registration statement, means information
included in a prospectus then deemed to be a part of such registration statement pursuant
to Rule 430C.
“Act” means the Securities Act of 1933, as amended.
“Applicable Time” means [•]:00 [A./P.]M. (Eastern time) on the date of this Agreement.
“Closing Date” has the meaning defined in Section 3 hereof.
“Commission” means the Securities and Exchange Commission.
“Effective Time” with respect to the Initial Registration Statement or, if filed prior
to the execution and delivery of this Agreement, the Additional Registration Statement
means the date and time as of which such Registration Statement was declared effective by
the Commission or has become effective upon filing pursuant to Rule 462(c). If an
Additional Registration Statement has not been filed prior to the execution and delivery of
this Agreement but the Company has advised the Representative that it proposes to file one,
“Effective Time” with respect to such Additional Registration Statement means the date and
time as of which such Registration Statement is filed and becomes effective pursuant to
Rule 462(b).
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Final Prospectus” means the Statutory Prospectus that discloses the public offering
price, other 430A Information and other final terms of the Offered Securities and otherwise
satisfies Section 10(a) of the Act.
“General Use Issuer Free Writing Prospectus” means any Issuer Free Writing Prospectus
that is intended for general distribution to prospective investors, as evidenced by its
being so specified in Schedule B to this Agreement.
“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as
defined in Rule 433, relating to the Offered Securities 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).
“Limited Use Issuer Free Writing Prospectus” means any Issuer Free Writing Prospectus
that is not a General Use Issuer Free Writing Prospectus.
The Initial Registration Statement and the Additional Registration Statement are
referred to collectively as the “Registration Statements” and individually as a
“Registration Statement”. A “Registration Statement” with reference to a particular time
means the Initial Registration
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Statement and any Additional Registration Statement as of such time. A “Registration
Statement” without reference to a time means such Registration Statement as of its
Effective Time. For purposes of the foregoing definitions, 430A Information with respect
to a Registration Statement shall be considered to be included in such Registration
Statement as of the time specified in Rule 430A.
“Rules and Regulations” means the rules and regulations of the Commission.
“Securities Laws” means, collectively, the Xxxxxxxx-Xxxxx Act of 2002
(“Xxxxxxxx-Xxxxx”), the Act, the Exchange Act, the Rules and Regulations, the auditing
principles, rules, standards and practices applicable to auditors of “issuers” (as defined
in Xxxxxxxx-Xxxxx) promulgated or approved by the Public Company Accounting Oversight Board
and, as applicable, the rules of the Nasdaq Stock Market (“Exchange Rules”).
“Statutory Prospectus” with reference to a particular time means the prospectus
included in a Registration Statement immediately prior to that time, including any 430A
Information or 430C Information with respect to such Registration Statement. For purposes
of the foregoing definition, 430A Information shall be considered to be included in the
Statutory Prospectus as of the actual time that form of prospectus is filed with the
Commission pursuant to Rule 424(b) or Rule 462(c) and not retroactively.
Unless otherwise specified, a reference to a “rule” is to the indicated rule under the Act.
(b) Compliance with Securities Act Requirements. (i) (A) At their respective
Effective Times, (B) on the date of this Agreement and (C) on each Closing Date, each of
the Initial Registration Statement and the Additional Registration Statement (if any)
conformed and will conform in all material respects to the requirements of the Act and
the Rules and Regulations and did not and will not include any untrue statement of a
material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) on its date, at the time
of filing of the Final Prospectus pursuant to Rule 424(b) or (if no such filing is
required) at the Effective Time of the Additional Registration Statement in which the
Final Prospectus is included, and on each Closing Date, the Final Prospectus will
conform in all material respects to the requirements of the Act and the Rules and
Regulations and will not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading and (iii) on the date of this Agreement, at their
respective Effective Times or issue dates and on each Closing Date, each Registration
Statement, the Final Prospectus, any Statutory Prospectus, any prospectus wrapper and
any Issuer Free Writing Prospectus complied or comply, and such documents and any
further amendments or supplements thereto will comply, with any applicable laws or
regulations of foreign jurisdictions in which the Final Prospectus, any Statutory
Prospectus, any prospectus wrapper or any Issuer Free Writing Prospectus, as amended or
supplemented, if applicable, are distributed in connection with the Directed Share
Program. The preceding sentence does not apply to statements in or omissions from any
such document based upon written information furnished to the Company by any Underwriter
through the Representative specifically for use therein, it being understood and agreed
that the only such information is that described as such in Section 8(b) hereof.
(c) Ineligible Issuer Status. (i) At the time of initial filing of the Initial
Registration Statement and (ii) at the date of this Agreement, the Company was not and
is not an “ineligible issuer,” as defined in Rule 405.
(d) General Disclosure Package. As of the Applicable Time, neither (i) the
General Use Issuer Free Writing Prospectus(es) issued at or prior to the Applicable
Time, the preliminary prospectus, dated [•], 2007 (which is the most recent Statutory
Prospectus distributed to investors generally) and the other information, if any, stated
in Schedule B to this Agreement to
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be included in the General Disclosure Package, all considered together
(collectively, the “General Disclosure Package”), nor (ii) any individual Limited Use
Issuer Free Writing Prospectus, when considered together with the General Disclosure
Package, included any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding sentence does
not apply to statements in or omissions from any Statutory Prospectus or any Issuer Free
Writing Prospectus in reliance upon and in conformity with written information furnished
to the Company by any Underwriter through the Representative specifically for use
therein, it being understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in Section 8(b) hereof.
(e) Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus, as of
its issue date and at all subsequent times through the completion of the public offer
and sale of the Offered Securities or until any earlier date that the Company notified
or notifies Credit Suisse Securities (USA) LLC (“Credit Suisse”) as described in the
next sentence, did not, does not and will not include any information that conflicted,
conflicts or will conflict with the information then contained in the Registration
Statement. If at any time following issuance of an Issuer Free Writing Prospectus but
no later than the latest to occur of (i) any Closing Date, (ii) the completion of the
distribution of the Offered Securities and, if applicable, the Brookside Securities or
(iii) the end of the period when a prospectus relating to the Offered Securities is (or
but for the exemption in Rule 172 would be) required to be delivered under the Act by
any Underwriter or dealer, 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 then contained in the Registration Statement or as a result of which such
Issuer Free Writing Prospectus, if republished immediately following such event or
development, 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 under which they were made, not misleading, (x) the Company
has promptly notified or will promptly notify Credit Suisse and (y) the Company has
promptly amended or will promptly amend or supplement such Issuer Free Writing
Prospectus to eliminate or correct such conflict, untrue statement or omission. The
foregoing two sentences do not apply to statements in or omissions from any Issuer Free
Writing Prospectus based upon written information furnished to the Company by any
Underwriter through the Representative specifically for use therein, it being understood
and agreed that the only such information is that described as such in Section 8(b)
hereof.
(f) Good standing of the Company. The Company has been duly incorporated and is
existing and in good standing under the laws of the State of Delaware, with corporate
power and authority to own its properties and conduct its business as described in the
General Disclosure Package; and the Company is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions in which its ownership
or lease of property or the conduct of its business requires such qualification, except
where the failure to be so qualified or in good standing would not result in a material
adverse effect on the condition (financial or otherwise), results of operations,
business, properties or prospects of the Company (a “Material Adverse Effect”).
(g) Subsidiaries. The Company does not have any “subsidiaries” (within the
meaning of Rule 405 under the Act).
(h) Offered Securities. The Offered Securities and all other outstanding shares
of capital stock of the Company have been duly authorized; the authorized equity
capitalization of the Company is as set forth in the General Disclosure Package; all
outstanding shares of capital stock of the Company are, and, when the Offered Securities
have been delivered and paid for in accordance with this Agreement on each Closing Date,
such Offered Securities will have been,
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validly issued, fully paid and nonassessable, will conform in all material respects
to the information in the General Disclosure Package and to the description of such
Offered Securities contained in the Final Prospectus; the stockholders of the Company
have no preemptive rights with respect to the Securities; and none of the outstanding shares of capital stock of the Company have been issued in violation of any preemptive
or similar rights of any security holder.
(i) No Finder’s Fee. Except as disclosed in the General Disclosure Package, there
are no contracts, agreements or understandings between the Company and any person that
would give rise to a valid claim against the Company or any Underwriter for a brokerage
commission, finder’s fee or other like payment in connection with this offering.
(j) Registration Rights. Except as disclosed in the General Disclosure Package,
in connection with the sale of the Offered Securities, there are no contracts,
agreements or understandings between the Company and any person granting such person the
right to require the Company to file a registration statement under the Act with respect
to any securities of the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered pursuant to a
Registration Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Act (collectively, “registration
rights”), and any person to whom the Company has granted registration rights has agreed
not to exercise such rights until after the expiration of the Lock-Up Period referred to
in Section 5 hereof.
(k) Listing. The Offered Securities have been approved for listing on the Nasdaq
Stock Market, subject to notice of issuance.
(l) Absence of Further Requirements. No consent, approval, authorization, or
order of, or filing or registration with, any person (including any governmental agency
or body or any court) is required to be obtained or made by the Company for the
consummation of the transactions contemplated by this Agreement in connection with the
offering, issuance and sale of the Offered Securities by the Company, except such as
have been obtained, or made, or as may be required under rules and regulations of the
National Association of Securities Dealers, or under state and foreign securities laws.
(m) Title to Property. Except as disclosed in the General Disclosure Package, the
Company has good and marketable title to all real properties and all other properties
and assets owned by the Company that are necessary or material to the conduct of the
business now conducted by it or proposed in the General Disclosure Package to be
conducted by them, in each case free from liens, charges, encumbrances and defects that
would materially affect the value thereof or materially interfere with the use made or
to be made thereof by the Company and, except as disclosed in the General Disclosure
Package, the Company holds any leased real or personal property under valid and
enforceable leases with no terms or provisions that would materially interfere with the
use made or to be made thereof by the Company.
(n) Absence of Defaults and Conflicts Resulting from Transaction. The execution,
delivery and performance of this Agreement, and the issuance and sale of the Offered
Securities will not result in a breach or violation of any of the terms and provisions
of, or constitute a default or a Debt Repayment Triggering Event (as defined below)
under, or result in the imposition of any lien, charge or encumbrance upon any property
or assets of the Company pursuant to, the amended and restated certificate of
incorporation or amended and restated by-laws of the Company, any statute, rule,
regulation or order of any governmental agency or body or any court, domestic or
foreign, having jurisdiction over the Company or any of its properties, or any agreement
or instrument to which the Company is a party or by which the Company is bound or to
which any of the properties of the Company is subject; a “Debt Repayment Triggering
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Event” means any event or condition that gives, or with the giving of notice or
lapse of time would give, 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.
(o) Absence of Existing Defaults and Conflicts. The Company is not in violation
of its amended and restated certificate of incorporation or amended and restated by-laws
or in default (or with the giving of notice or lapse of time would be in default) under
any existing obligation, agreement, covenant or condition contained in any indenture,
loan agreement, mortgage, lease or other agreement or instrument to which the Company is
a party or by which the Company is bound or to which any of its properties is subject,
except such defaults that would not, individually or in the aggregate, result in a
Material Adverse Effect.
(p) Authorization of Agreement. This Agreement has been duly authorized, executed
and delivered by the Company.
(q) Possession of Licenses and Permits. The Company possesses, and is in
compliance with the terms of, all certificates, authorizations, franchises, licenses and
permits (“Licenses”) necessary or material to the conduct of the business now conducted
by it or proposed in the General Disclosure Package to be conducted by it and has not
received any notice of proceedings relating to the revocation or modification of any
Licenses that, if determined adversely to the Company, would, individually or in the
aggregate, have a Material Adverse Effect.
(r) Absence of Labor Dispute. No labor dispute with the employees of the Company
exists or, to the knowledge of the Company, is imminent that could have a Material
Adverse Effect.
(s) Possession of Intellectual Property. The Company owns, possesses or can
acquire on reasonable terms sufficient trademarks, trade names, copyrights, domain
names, trade secrets, inventions, technology, know-how and other intellectual property
and similar rights (other than patents), including registrations and applications for
registration thereof and licenses and approvals to use thereof (collectively,
“Non-Patent Intellectual Property Rights”) necessary to the conduct of the business now
conducted or proposed in the General Disclosure Package to be conducted by it, except
where such failure to own, possess or acquire such Non-Patent Intellectual Property
Rights would not, individually or in the aggregate, have a Material Adverse Effect. To
the Company’s knowledge, the Company owns, possesses or can acquire on reasonable terms
sufficient rights to the patents presently practiced by the Company, which are necessary
to the conduct of the business now conducted or proposed in the General Disclosure
Package to be conducted by it, except where such failure to own or possess such patent
rights would not, individually or in the aggregate, have a Material Adverse Effect. The
Non-Patent Intellectual Property Rights and the patent rights are referred to herein
collectively as the “Intellectual Property Rights.” Except as disclosed in the General
Disclosure Package (i) there are no rights of third parties to any of the Intellectual
Property Rights owned by the Company, other than licenses granted to customers,
suppliers, and contractors of the Company in the ordinary course of business with
respect to the Company’s products and services; (ii) to the Company’s knowledge, there
is no material infringement, misappropriation, breach, default or other violation, or
the occurrence of any event that with notice or the passage of time would constitute any
of the foregoing, by a third party of any Intellectual Property Rights owned by the
Company; (iii) there is no pending or, to Company’s knowledge, threatened action, suit,
proceeding or claim by others challenging the Company’s rights in or to, or the
violation of any of the terms of, any of the Intellectual Property Rights owned by the
Company, and the Company is unaware of any facts which would form a reasonable basis for
any such claim; (iv) there is no pending or, to the Company’s knowledge, threatened
action, suit, proceeding or claim by others challenging the validity, enforceability or
scope of any Intellectual Property
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Rights owned by the Company, and the Company is unaware of any facts which would
form a reasonable basis for any such claim; (v) there is no pending or, to the Company’s
knowledge, threatened action, suit, proceeding or claim by others that the Company
infringes, misappropriates, breaches, defaults or otherwise violates or conflicts with
any Intellectual Property Rights or other proprietary rights of others and the Company
is unaware of any other fact which would form a reasonable basis for any such claim; and
(vi) none of the Intellectual Property Rights used by the Company which are necessary to
the conduct of the business as now conducted or proposed in the General Disclosure
Package to be conducted by it has been obtained or is being used by the Company in
violation of any contractual obligation binding on the Company, in violation of the
rights of any persons, except in each case covered by clauses (i) — (vi) such as would
not, if determined adversely to the Company, individually or in the aggregate, have a
Material Adverse Effect.
(t) Environmental Laws. Except as disclosed in the General Disclosure Package,
the Company (i) is not in violation of any statute, any rule, regulation, decision or
order of any governmental agency or body or any court, domestic or foreign, relating to
the use, disposal or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to hazardous or toxic
substances (collectively, “Environmental Laws”), or (ii) does not own or operate any
real property contaminated with any substance that is subject to any Environmental Laws,
is not liable for any off-site disposal or contamination pursuant to any Environmental
Laws, or is not subject to any claim relating to any Environmental Laws, which
violation, contamination, liability or claim would individually or in the aggregate have
a Material Adverse Effect; and the Company is not aware of any pending investigation
which might lead to a claim that would have a Material Adverse Effect.
(u) Accurate Disclosure. The statements in the General Disclosure Package and the
Final Prospectus under the headings “Certain Material U.S. Federal Income and Estate Tax
Considerations to Non-U.S. Holders” and “Description of the Capital Stock,” insofar as
such statements summarize legal matters, agreements, documents or proceedings discussed
therein, are, in all material respects, accurate and fair summaries of such legal
matters, agreements, documents or proceedings and, to the extent applicable, present the
information required to be shown.
(v) Absence of Manipulation. The Company has not taken, directly or indirectly,
any action that is designed to cause or result in, or that has constituted or that would
reasonably be expected to cause or result in, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the Offered
Securities.
(w) Statistical and Market-Related Data. Any third-party statistical and
market-related data included in a Registration Statement, a Statutory Prospectus or the
General Disclosure Package are based on or derived from sources that the Company
believes to be reliable and accurate.
(x) Internal Controls and Compliance with the Xxxxxxxx-Xxxxx Act. Except as set
forth in the General Disclosure Package, the Company and the Company’s Board of
Directors (the “Board”) are in compliance with Xxxxxxxx-Xxxxx, to the extent applicable,
and all applicable Exchange Rules. The Company maintains a system of internal controls,
including, but not limited to, disclosure controls and procedures, internal controls
over accounting matters and financial reporting, and legal and regulatory compliance
controls (collectively, “Internal Controls”) that are designed to provide reasonable
assurances that (i) transactions are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with U.S. General Accepted Accounting
Principles and to maintain accountability for assets, (iii) access to assets is
permitted only in accordance with management’s general or specific authorization and
(iv) the recorded accountability for assets necessary and material to the Company is
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compared with the existing assets at reasonable intervals and appropriate action is
taken with respect to any differences. The Internal Controls are, or upon consummation
of the offering of the Offered Securities will be, overseen by the Audit Committee (the
“Audit Committee”) of the Board in accordance with Exchange Rules. Except as set forth
in the General Disclosure Package, the Company has not publicly disclosed or reported to
the Audit Committee or the Board, and within the next 135 days the Company
does not reasonably expect to publicly disclose or report to the Audit Committee or the
Board, a significant deficiency, material weakness, change in Internal Controls or fraud
involving management or other employees who have a significant role in Internal Controls
(each, an “Internal Control Event”), any violation of, or failure to comply with, the
Securities Laws, or any matter which, if determined adversely, would have a Material
Adverse Effect.
(y) Disclosure Controls and Procedures. The Company maintains disclosure controls
and procedures (as such term is defined in Rule 13a-15(e) under the Exchange Act) that
are designed to comply with the requirements of the Exchange Act and designed to ensure
that material information relating to the Company is made known to the Company’s
principal executive officer and principal financial officer by others within the
Company.
(z) Internal Controls Over Financial Reporting. Since the date of the latest
audited financial statements included in the Final Prospectus, there has been no change
in the Company’s internal control over financial reporting that has materially affected,
or is reasonably likely to materially affect, the Company’s internal control over
financial reporting, other than changes designed to remediate Internal Control Events
set forth in the General Disclosure Package.
(aa) Litigation. Except as disclosed in the General Disclosure Package, there are
no pending actions, suits or proceedings (including any inquiries or investigations by
any court or governmental agency or body, domestic or foreign) against or affecting the
Company or any of its properties that, if determined adversely to the Company, would
individually or in the aggregate have a Material Adverse Effect, or would materially and
adversely affect the ability of the Company to perform its obligations under this
Agreement, or which are otherwise material in the context of the sale of the Offered
Securities; and no such actions, suits or proceedings (including any inquiries or
investigations by any court or governmental agency or body, domestic or foreign) are
threatened or, to the Company’s knowledge, contemplated.
(bb) Financial Statements. The financial statements included in each Registration
Statement and the General Disclosure Package present fairly the financial position of
the Company as of the dates shown and its results of operations and cash flows for the
periods shown, and such financial statements have been prepared in conformity with the
generally accepted accounting principles in the United States—applied on a consistent
basis; and the schedules included in each Registration Statement and the General
Disclosure Package present fairly the information required to be stated therein.
(cc) No Material Adverse Change in Business. Except as disclosed in the General
Disclosure Package, since the end of the period covered by the latest audited financial
statements included in the General Disclosure Package (i) there has been no change, nor
any development or event involving a prospective change, in the condition (financial or
otherwise), results of operations, business, properties or prospects of the Company that
is material and adverse, (ii) except as disclosed in or contemplated by the General
Disclosure Package, there has been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock and (iii) except as
disclosed in or contemplated by the General Disclosure Package, there has been no
material adverse change in the capital stock, short-term indebtedness, long-term
indebtedness, net current assets or net assets of the Company.
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(dd) Investment Company Act. The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the proceeds thereof
as described in the General Disclosure Package, will not be an “investment company” as
defined in the Investment Company Act of 1940 (the “Investment Company Act”).
(ee) Ratings. No “nationally recognized statistical rating organization” as such
term is defined for purposes of Rule 436(g)(2) (i) has imposed (or has informed the
Company that it is considering imposing) any condition (financial or otherwise) on the
Company’s retaining any rating assigned to the Company or any securities of the Company
or (ii) has indicated to the Company that it is considering any of the actions described
in Section 7(c)(ii) hereof.
(ff) Insurance. The Company is insured by insurers with appropriately rated
claims-paying abilities against such losses and risks and in such amounts as the Company
reasonably believes are prudent and customary for the businesses in which the Company is
engaged; all policies of insurance and fidelity or surety bonds insuring the Company or
its business, assets, employees, officers and directors are in full force and effect;
the Company is in compliance with the terms of such policies and instruments in all
material respects; and there are no claims by the Company under any such policy or
instrument as to which any insurance company is denying liability or defending under a
reservation of rights clause; the Company has not been refused any insurance coverage
sought or applied for within the past three years; and the Company has no reason to
believe that it will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not be reasonably expected to
have a Material Adverse Effect, except as set forth in or contemplated in the General
Disclosure Package and the Company will obtain directors’ and officer’s insurance in
such amounts as is customary for an initial public offering.
(gg) Tax Filings. The Company has filed all federal, state, local and non-U.S.
tax returns that are required to be filed or have requested extensions thereof (except
in any case in which the failure so to file would not be reasonably expected to have a
Material Adverse Effect); and, except as set forth in the General Disclosure Package,
the Company has paid all taxes (including any assessments, fines or penalties) required
to be paid by them, except for any such taxes, assessments, fines or penalties currently
being contested in good faith or as would not, individually or in the aggregate, have a
Material Adverse Effect.
(hh) Absence of Unlawful Influence. The Company has not offered or sold, or
caused the Underwriters to offer or sell, any Offered Securities to any person pursuant
to the Directed Share Program with the specific intent to unlawfully influence (i) a
customer or supplier of the Company to alter the customer’s or supplier’s level or type
of business with the Company or (ii) a trade journalist or publication to write or
publish favorable information about the Company or its products.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of the representations,
warranties and agreements and subject to the terms and conditions set forth herein, the Company
agrees to sell to the several Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at a purchase price of $[•] per share, the respective number
of shares of Firm Securities set forth opposite the names of the Underwriters in Schedule A hereto.
As part of the offering contemplated by this Agreement, the Underwriters agree to reserve the
Brookside Securities for offer and sale to Brookside upon the terms and subject to the conditions
set forth in this Agreement and the Brookside Securities shall be purchased from the Company at a
purchase price of $[•] per share. Any Brookside Securities that are not confirmed for purchase in
writing by Brookside by the end of the second business day following the date hereof (or such other
time as agreed to by the Underwriters and Brookside) shall be purchased by the Underwriters from
the Company pursuant to and in accordance with the first sentence of this section 3 and offered to
the public by the Underwriters in accordance with this Agreement.
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The Company will deliver the Firm Securities to or as instructed by the Representative for the
accounts of the several Underwriters in a form reasonably acceptable to the Representative against
payment of the purchase price by the Underwriters in Federal (same day) funds by wire transfer to
an account at a bank acceptable to Credit Suisse drawn to the order of the Company at the New York,
New York offices of Cravath, Swaine & Xxxxx LLP, at [•] A.M. New York time, on [•], 2007, or at
such other time not later than seven full business days thereafter as the Representative and the
Company determine, such time being herein referred to as the “First Closing Date”. For purposes of
Rule 15c6-1 under the Securities Exchange Act of 1934, the First Closing Date (if later than the
otherwise applicable settlement date) shall be the settlement date for payment of funds and
delivery of securities for all the Offered Securities sold pursuant to the offering. The Firm
Securities so to be delivered or evidence of their issuance will be made available for checking at
the above office of Cravath, Swaine & Xxxxx LLP at least 24 hours prior to the First Closing Date.
In addition, upon written notice from the Representative given to the Company from time to
time not more than 30 days subsequent to the date of the Final Prospectus, the Underwriters may
purchase all or less than all of the Optional Securities at the purchase price per Security to be
paid for the Firm Securities. The Company agrees to sell to the Underwriters the number of shares
of Optional Securities specified in such notice and the Underwriters agree, severally and not
jointly, to purchase such Optional Securities. Such Optional Securities shall be purchased for the
account of each Underwriter in the same proportion as the number of shares of Firm Securities set
forth opposite such Underwriter’s name bears to the total number of shares of Firm Securities
(subject to adjustment by the Representative to eliminate fractions) and may be purchased by the
Underwriters only for the purpose of covering over-allotments made in connection with the sale of
the Firm Securities. No Optional Securities shall be sold or delivered unless the Firm Securities
previously have been, or simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the extent not
previously exercised may be surrendered and terminated at any time upon notice by the
Representative to the Company.
Each time for the delivery of and payment for the Optional Securities, being herein referred
to as an “Optional Closing Date”, which may be the First Closing Date (the First Closing Date and
each Optional Closing Date, if any, being sometimes referred to as a “Closing Date”), shall be
determined by the Representative but shall be not later than five full business days after written
notice of election to purchase Optional Securities is given. The Company will deliver the Optional
Securities being purchased on each Optional Closing Date to or as instructed by the Representative
for the accounts of the several Underwriters in a form reasonably acceptable to the Representative
against payment of the purchase price therefor in Federal (same day) funds by wire transfer to an
account at a bank acceptable to Credit Suisse drawn to the order of the Company at the New York,
New York offices of Cravath, Swaine & Xxxxx LLP. The Optional Securities being purchased on each
Optional Closing Date or evidence of their issuance will be made available for checking at the New
York, New York offices of Cravath, Swaine & Xxxxx LLP at a reasonable time in advance of such
Optional Closing Date.
4. Offering by Underwriters. It is understood that the several Underwriters propose to offer
the Offered Securities for sale to the public as set forth in the Final Prospectus.
5. Certain Agreements of the Company. The Company agrees with the several Underwriters that:
(a) Additional Filings. Unless filed pursuant to Rule 462(c) as part of the
Additional Registration Statement in accordance with the next sentence, the Company will
file the Final Prospectus, in a form approved by the Representative (which approval
shall not be unreasonably withheld or delayed), with the Commission pursuant to and in
accordance with subparagraph (1) (or, if applicable and if consented to by the
Representative, subparagraph (4)) of Rule 424(b) not later than the earlier of (A) the
second business day following the execution and delivery of this Agreement or (B) the
fifteenth business day after the Effective Time of the Initial Registration Statement.
The Company will advise the Representative promptly of any
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such filing pursuant to Rule 424(b) and provide reasonably satisfactory evidence to
the Representative of such timely filing. If an Additional Registration Statement is
necessary to register a portion of the Offered Securities under the Act but the
Effective Time thereof has not occurred as of the execution and delivery of this
Agreement, the Company will file the additional registration statement or, if filed,
will file a post-effective amendment thereto with the Commission pursuant to and in
accordance with Rule 462(b) on or prior to 10:00 P.M., New York time, on the date of
this Agreement or, if earlier, on or prior to the time the Final Prospectus is finalized
and distributed to any Underwriter, or will make such filing at such later date as shall
have been consented to by the Representative.
(b) Filing of Amendments; Response to Commission Requests. The Company will
promptly advise the Representative of any proposal to amend or supplement at any time
the Initial Registration Statement, any Additional Registration Statement or any
Statutory Prospectus and will not effect such amendment or supplementation without the
Representative’s consent; and the Company will also advise the Representative promptly
of (i) the effectiveness of any Additional Registration Statement (if its Effective Time
is subsequent to the execution and delivery of this Agreement), (ii) any amendment or
supplementation of a Registration Statement or any Statutory Prospectus, (iii) any
request by the Commission or its staff for any amendment to any Registration Statement,
for any supplement to any Statutory Prospectus or for any additional information, (iv)
the institution by the Commission of any stop order proceedings in respect of a
Registration Statement or the threatening of any proceeding for that purpose, and (v)
the receipt by the Company of any notification with respect to the suspension of the
qualification of the Offered Securities in any jurisdiction or the institution or
threatening of any proceedings for such purpose. The Company will use its best efforts
to prevent the issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible the withdrawal thereof.
(c) Continued Compliance with Securities Laws. If, at any time when a prospectus
relating to the Offered Securities is (or but for the exemption in Rule 172 would be)
required to be delivered under the Act by any Underwriter or dealer, any event occurs as
a result of which the Final Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact necessary to make
the statements therein, in light of the circumstances under which they were made, not
misleading, or if it is necessary at any time to amend the Registration Statement or
supplement the Final Prospectus to comply with the Act, the Company will promptly notify
the Representative of such event and will promptly prepare and file with the Commission
and furnish, at its own expense, to the Underwriters and the dealers and any other
dealers upon request of the Representative, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such compliance.
Neither the Representative’s consent to, nor the Underwriters’ delivery of, any such
amendment or supplement shall constitute a waiver of any of the conditions set forth in
Section 7 hereof.
(d) Rule 158. As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its security holders an
earnings statement covering a period of at least 12 months beginning after the Effective
Time of the Initial Registration Statement (or, if later, the Effective Time of the
Additional Registration Statement) which will satisfy the provisions of Section 11(a) of
the Act and Rule 158 under the Act. For the purpose of the preceding sentence,
“Availability Date” means the day after the end of the fourth fiscal quarter following
the fiscal quarter that includes such Effective Time on which the Company is required to
file its Form 10-Q for such fiscal quarter except that, if such fourth fiscal quarter is
the last quarter of the Company’s fiscal year, “Availability Date” means the day after
the end of such fourth fiscal quarter on which the Company is required to file its Form
10-K.
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(e) Furnishing of Prospectuses. The Company will furnish to the Representative
copies of each Registration Statement (five of which will be signed and will include all
exhibits), each related Statutory Prospectus, and, so long as a prospectus relating to
the Offered Securities is (or but for the exemption in Rule 172 would be) required to be
delivered under the Act, the Final Prospectus and all amendments and supplements to such
documents, in each case in such quantities as the Representative reasonably requests.
The Final Prospectus shall be so furnished on or prior to 3:00 P.M., New York time, on
the business day following the execution and delivery of this Agreement. All other such
documents shall be so furnished as soon as available. The Company will pay the expenses
of printing and distributing to the Underwriters all such documents.
(f) Blue Sky Qualifications. The Company will use commercially reasonable efforts
to arrange for the qualification of the Offered Securities for sale under the laws of
such jurisdictions as the Representative reasonably designates and will continue such
qualifications in effect so long as required for the distribution of the Offered
Securities by the Underwriters; provided, however, that the Company will not be required
to arrange for the qualification of the Offered Securities for sale under the laws of
any jurisdiction if such qualification would require the Company to qualify as a foreign
corporation or to file a general consent to service of process in any such jurisdiction
or subject the Company to taxation for doing business in any jurisdiction in which it is
not otherwise so subject.
(g) Reporting Requirements. During the period of three years hereafter, the
Company will furnish to the Representative and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a copy of its
annual report to stockholders for such year; and the Company will furnish to the
Representative (i) as soon as available, a copy of each report and any definitive proxy
statement of the Company filed with the Commission under the Exchange Act or mailed to
stockholders, and (ii) from time to time, such other information concerning the Company
as the Representative may reasonably request. However, so long as the Company is
subject to the reporting requirements of either Section 13 or Section 15(d) of the
Exchange Act and is timely filing reports with the Commission on its Electronic Data
Gathering, Analysis and Retrieval system (“XXXXX”), it is not required to furnish such
reports or statements to the Underwriters.
(h) Payment of Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including but not limited to any
filing fees and other expenses incurred in connection with qualification of the Offered Securities
for sale under the laws of such jurisdictions as the Representative designates and the
preparation and printing of memoranda relating thereto, costs and expenses related to
the review by the National Association of Securities Dealers, Inc. of the Offered
Securities (including filing fees), costs and expenses relating to investor
presentations or any “road show” in connection with the offering and sale of the Offered
Securities including, without limitation, any travel expenses of the Company’s officers
and employees and any other expenses of the Company, including 50% of the cost of any
aircraft chartered in connection with attending or hosting such meetings, fees and
expenses incident to listing the Offered Securities on the Nasdaq Stock Market and other
national and foreign exchanges, fees and expenses in connection with the registration of
the Offered Securities under the Exchange Act, and expenses incurred in distributing
preliminary prospectuses and the Final Prospectus (including any amendments and
supplements thereto) to the Underwriters and for expenses incurred for preparing,
printing and distributing any Issuer Free Writing Prospectuses to investors or
prospective investors.
(i) Use of Proceeds. The Company will use the net proceeds received by it in
connection with this offering in the manner described in the “Use of Proceeds” section
of the General
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Disclosure Package and, except as disclosed in the General Disclosure Package, the
Company does not intend to use any of the proceeds from the sale of the Offered
Securities hereunder to repay any outstanding debt owed to any affiliate of any
Underwriter.
(j) Absence of Manipulation. The Company will not take, directly or indirectly,
any action designed to or that would constitute or that might reasonably be expected to
cause or result in, stabilization or manipulation of the price of any securities of the
Company to facilitate the sale or resale of the Offered Securities.
(k) Restriction on Sale of Securities by Company. For the period specified below
(the “Lock-Up Period”), the Company will not, directly or indirectly, take any of the
following actions with respect to any shares of its Securities or any securities
convertible into or exchangeable or exercisable for any of its Securities (“Lock-Up
Securities”): (i) offer, sell, issue, contract to sell, pledge or otherwise dispose of
Lock-Up Securities, (ii) offer, sell, issue, contract to sell, contract to purchase or
grant any option, right or warrant to purchase Lock-Up Securities, (iii) enter into any
swap, hedge or any other agreement that transfers, in whole or in part, the economic
consequences of ownership of Lock-Up Securities, (iv) establish or increase a put
equivalent position or liquidate or decrease a call equivalent position in Lock-Up
Securities within the meaning of Section 16 of the Exchange Act or (v) file with the
Commission a registration statement under the Act relating to Lock-Up Securities, or
publicly disclose the intention to take any such action, without the prior written
consent of the Representative. The foregoing restrictions will not apply to (A) the
Offered Securities to be sold pursuant to this Agreement, (B) the offer and sale of
Brookside Securities contemplated by this Agreement, (C) issuances of Lock-Up Securities
pursuant to the conversion or exchange of convertible or exchangeable securities or the
exercise of warrants or options, in each case outstanding on the date hereof and
described in the General Disclosure Package or the Final Prospectus and (D) grants of
stock options or other Lock-Up Securities in the ordinary course of business pursuant to
the terms of a plan in effect on the date hereof or a plan described in the General
Disclosure Package or the Final Prospectus, and issuances of Lock-Up Securities issuable
upon the exercise of such options or other Lock-Up Securities. The initial Lock-Up
Period will commence on the date hereof and continue for 180 days after the date hereof
or such earlier date that the Representative consents to in writing; provided, however,
that if (1) during the last 17 days of the initial Lock-Up Period, the Company releases
earnings results or material news or a material event relating to the Company occurs or
(2) prior to the expiration of the initial Lock-Up Period, the Company announces that it
will release earnings results during the 16-day period beginning on the last day of the
initial Lock-Up Period, then in each case the Lock-Up Period will be extended until the
expiration of the 18-day period beginning on the date of release of the earnings results
or the occurrence of the materials news or material event, as applicable, unless the
Representative waives, in writing, such extension. The Company will provide the
Representative with notice of any announcement described in clause (2) of the preceding
sentence that gives rise to an extension of the Lock-Up Period.
(l) Transfer Restrictions. In connection with the Directed Share Program, the
Company will ensure that the Directed Shares will be restricted to the extent required
by the Financial Industry Regulatory Authority (the “FINRA”) or the FINRA rules from
sale, transfer, assignment, pledge or hypothecation for a period of three months
following the date of the effectiveness of the Registration Statement. The Designated
Underwriter will notify the Company as to which Participants will need to be so
restricted. The Company will direct the transfer agent to place stop transfer
restrictions upon such securities for such period of time.
(m) Payment of Expenses Related to Directed Share Program. The Company will pay
all fees and disbursements of counsel (including non-U.S. counsel) incurred by the
Underwriters in connection with the Directed Share Program and stamp duties, similar
taxes or duties or other taxes, if any, incurred by the underwriters in connection with
the Directed Share Program.
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(n) Compliance with Foreign Laws. The company will comply with all applicable
securities and other applicable laws, rules and regulations in each foreign jurisdiction
in which the Directed Shares are offered in connection with the Directed Share Program.
6. Free Writing Prospectuses. The Company represents and agrees that, unless it obtains or
has obtained the prior consent of Credit Suisse, and each Underwriter represents and agrees that,
unless it obtains or has obtained the prior consent of the Company and Credit Suisse, it has not
made and will not make any offer relating to the Offered Securities that would constitute an Issuer
Free Writing Prospectus, or that would otherwise constitute a “free writing prospectus,” as defined
in Rule 405, required to be filed with the Commission. Any such free writing prospectus consented
to by the Company and Credit Suisse is hereinafter referred to as a “Permitted Free Writing
Prospectus.” The Company represents that it has treated and agrees that it will treat each
Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433,
and has complied and will comply with the requirements of Rules 164 and 433 applicable to any
Permitted Free Writing Prospectus, including timely Commission filing where required, legending and
record keeping. The Company represents that is has satisfied and agrees that it will satisfy the
conditions in Rule 433 to avoid a requirement to file with the Commission any electronic road show.
7. Conditions of the Obligations of the Underwriters. The obligations of the several
Underwriters to purchase and pay for the Firm Securities on the First Closing Date and the Optional
Securities to be purchased on each Optional Closing Date will be subject to the accuracy of the
representations and warranties of the Company herein (as though made on such Closing Date), to the
accuracy of the statements of Company officers made pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following additional conditions
precedent:
(a) Accountants’ Comfort Letter. The Representative shall have received letters,
dated, respectively, the date hereof and each Closing Date, of Deloitte & Touche LLP
confirming that they are a registered public accounting firm and independent public
accountants within the meaning of the Securities Laws, which letters shall be in form
and substance satisfactory to the Representative.
(b) Effectiveness of Registration Statement. If the Effective Time of the
Additional Registration Statement (if any) is not prior to the execution and delivery of
this Agreement, such Effective Time shall have occurred not later than 10:00 P.M., New
York time, on the date of this Agreement or, if earlier, the time the Final Prospectus
is finalized and distributed to any Underwriter, or shall have occurred at such later
time as shall have been consented to by the Representative. The Final Prospectus shall
have been filed with the Commission in accordance with the Rules and Regulations and
Section 5(a) hereof. Prior to such Closing Date, no stop order suspending the
effectiveness of a Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the Company or the
Representative, shall be contemplated by the Commission.
(c) No Material Adverse Change. Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or otherwise), results of
operations, business, properties or prospects of the Company and its subsidiaries taken
as a whole which, in the judgment of the Representative, is material and adverse and
makes it impractical or inadvisable to market the Offered Securities; (ii) any
downgrading in the rating of any debt securities or preferred stock of the Company by
any “nationally recognized statistical rating organization” (as defined for purposes of
Rule 436(g)), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities or preferred stock of the
Company (other than an announcement with positive implications of a possible upgrading,
and no implication of a possible downgrading, of such rating); (iii) any change in U.S.
or international financial, political or economic conditions or currency exchange rates
or
- 14 -
exchange controls the effect of which is such as to make it, in the judgment of the
Representative, impractical to market or to enforce contracts for the sale of the
Offered Securities, whether in the primary market or in respect of dealings in the
secondary market; (iv) any suspension or material limitation of trading in securities
generally on the New York Stock Exchange or the Nasdaq Stock Market, or any setting of
minimum or maximum prices for trading on such exchanges; (v) or any suspension of
trading of any securities of the Company on any exchange or in the over-the-counter
market; (vi) any banking moratorium declared by any U.S. federal or New York
authorities; (vii) any major disruption of settlements of securities, payment, or
clearance services in the United States or any other country where such securities are
listed or (viii) any attack on, outbreak or escalation of hostilities or act of
terrorism involving the United States, any declaration of war by Congress or any other
national or international calamity or emergency if, in the judgment of the
Representative, the effect of any such attack, outbreak, escalation, act, declaration,
calamity or emergency is such as to make it impractical or inadvisable to market the
Offered Securities or to enforce contracts for the sale of the Offered Securities.
(d) Opinion of Counsel for Company. The Representative shall have received an
opinion, dated such Closing Date, of Paul, Hastings, Xxxxxxxx & Xxxxxx, LLP, counsel for
the Company, in form and substance satisfactory to the Representative.
(e) Opinion of Counsel for Underwriters. The Representative shall have received
from Cravath, Swaine & Xxxxx LLP, counsel for the Underwriters, such opinion or
opinions, dated such Closing Date, with respect to the incorporation of the Company, the
validity of the Offered Securities delivered on such Closing Date, the Registration
Statements, the General Disclosure Package, the Prospectus and other related matters as
the Representative may reasonably require, and the Company shall have furnished to such
counsel such documents as they reasonably request for the purpose of enabling them to
pass upon such matters.
(f) Officer’s Certificate. The Representative shall have received a certificate,
dated such Closing Date, of an executive officer of the Company and a principal
financial or accounting officer of the Company in which such officers shall state that:
the representations and warranties of the Company in this Agreement are true and
correct; the Company has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to such Closing Date; no
stop order suspending the effectiveness of any Registration Statement has been issued
and no proceedings for that purpose have been instituted or, to the best of their
knowledge and after reasonable investigation, are contemplated by the Commission; the
Additional Registration Statement (if any) satisfying the requirements of subparagraphs
(1) and (3) of Rule 462(b) was timely filed pursuant to Rule 462(b), including payment
of the applicable filing fee in accordance with Rule 111(a) or (b) of Regulation S-T of
the Commission; and, subsequent to the date of the most recent financial statements in
the General Disclosure Package, there has been no material adverse change, nor any
development or event involving a prospective material adverse change, in the condition
(financial or otherwise), results of operations, business, properties or prospects of
the Company except as set forth in the General Disclosure Package or as described in
such certificate.
(g) Lock-up Agreements. On or prior to the date hereof, the Representative shall
have received lockup letters from each of the executive officers and directors of the
Company and from each of the security holders of the Company to be
agreed upon in
form and substance satisfactory to the Representative.
The Company will furnish the Representative with such conformed copies of such opinions,
certificates, letters and documents as the Representative reasonably requests. Credit Suisse may in
its sole discretion waive on behalf of the Underwriters compliance with any conditions to the
obligations of the Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
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8. Indemnification and Contribution.
(a) Indemnification of Underwriters. The Company will indemnify and hold harmless
each Underwriter, its partners, members, directors, officers, employees, agents,
affiliates and each person, if any, who controls such Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act (each, an “Indemnified Party”),
against any and all losses, claims, damages or liabilities, joint or several, to which
such Indemnified Party may become subject, under the Act, the Exchange Act, other
Federal or state statutory law or regulation or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact contained in
any part of any Registration Statement at any time, any Statutory Prospectus as of any
time, the Final Prospectus or any Issuer Free Writing Prospectus, or arise out of or are
based upon the omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will reimburse
each Indemnified Party for any legal or other expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending against any such loss,
claim, damage, liability, action, litigation, investigation or proceeding whatsoever
(whether or not such Indemnified Party is a party thereto), whether threatened or
commenced, based upon any such untrue statement or omission, or any such alleged untrue
statement or omission as such expenses are incurred, and in connection with the
enforcement of this provision with respect to any of the above as such expenses are
incurred; provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission from any
of such documents in reliance upon and in conformity with written information furnished
to the Company by any Underwriter through the Representative specifically for use
therein, it being understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in subsection (b) below.
The Company agrees to indemnify and hold harmless the Designated Underwriter and its
affiliates and each person, if any, who controls the Designated Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (the
“Designated Entities"), from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action or claim) (i)
arising out of or based upon any untrue statement or alleged untrue statement of a
material fact contained in any material prepared by or with the consent of the Company
for distribution to Participants in connection with the Directed Share Program arising
out of or based upon any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein not misleading; (ii) arising
out of or based upon the failure of any Participant to pay for and accept delivery of
Directed Shares that the Participant agreed to purchase; or (iii) arising out of, related
to or in connection with the Directed Share Program, other than losses, claims, damages
or liabilities (or expenses relating thereto) that are finally judicially determined to
have resulted from the willful misconduct or gross negligence of the Designated Entities.
(b) Indemnification of Company. Each Underwriter will severally and not jointly
indemnify and hold harmless the Company, each of its directors and each of its officers
who signs a Registration Statement and each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (each, an
“Underwriter Indemnified Party”), against any losses, claims, damages or liabilities to
which such Underwriter Indemnified Party may become subject, under the Act, the Exchange
Act, or other Federal or state statutory law or regulation or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material fact
contained in any part of any Registration Statement at any time, any Statutory
Prospectus as of any time, the Final
- 16 -
Prospectus, or any Issuer Free Writing Prospectus, or arise out of or are based
upon the omission or the alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the Representative
specifically for use therein, and will reimburse any legal or other expenses reasonably
incurred by such Underwriter Indemnified Party in connection with investigating or
defending against any such loss, claim, damage, liability, action, litigation,
investigation or proceeding whatsoever (whether or not such Underwriter Indemnified
Party is a party thereto), whether threatened or commenced, based upon any such untrue
statement or omission, or any such alleged untrue statement or omission as such expenses
are incurred, it being understood and agreed that the only such information furnished by
any Underwriter consists of the following information in the Final Prospectus furnished
on behalf of each Underwriter: the concession figure appearing in the fourth paragraph
under the caption “Underwriting” and the information contained in the seventh, sixteenth
and seventeenth paragraphs under the caption “Underwriting”.
(c) Actions against Parties; Notification. Promptly after receipt by an
indemnified party under this Section of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party under subsection (a) or (b) above, notify the indemnifying party of
the commencement thereof; but the failure to notify the indemnifying party shall not
relieve it from any liability that it may have under subsection (a) or (b) above except
to the extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and provided further that the failure
to notify the indemnifying party shall not relieve it from any liability that it may
have to an indemnified party otherwise than under subsection (a) or (b) above. In case
any such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be entitled
to participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and after
notice from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. Notwithstanding anything contained herein to the
contrary, if indemnity may be sought pursuant to the last paragraph in Section 8 (a)
hereof in respect of such action or proceeding, then in addition to such separate firm
for the indemnified parties, the indemnifying party shall be liable for the reasonable
fees and expenses of not more than one separate firm (in addition to any local counsel)
for the Designated Underwriter for the defense of any losses, claims, damages and
liabilities arising out of the Directed Share Program, and all persons, if any, who
control the Designated Underwriter within the meaning of either Section 15 of the Act of
Section 20 of the Exchange Act. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party unless such
settlement (i) includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action 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 an indemnified party.
(d) Contribution. If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under subsection (a)
or (b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above
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(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 from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the Company on
the one hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities as well as any
other relevant equitable considerations. The relative benefits received by the Company
on the one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue statement or
omission. The amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities referred to in the first sentence of this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim which is the
subject of this subsection (d). Notwithstanding the provisions of this subsection (d),
no Underwriter shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation.
The Underwriters’ obligations in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations and not joint. The Company and
the Underwriters agree that it would not be just and equitable if contribution pursuant
to this Section 8(d) 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 in this Section 8(d).
9. Default of Underwriters. If any Underwriter or Underwriters default in their obligations
to purchase Offered Securities hereunder on either the First or any Optional Closing Date and the
aggregate number of shares of Offered Securities that such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed 10% of the total number of shares of Offered
Securities that the Underwriters are obligated to purchase on such Closing Date, Credit Suisse may
make arrangements satisfactory to the Company for the purchase of such Offered Securities by other
persons, including any of the Underwriters, but if no such arrangements are made by such Closing
Date, the non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such defaulting
Underwriters agreed but failed to purchase on such Closing Date. If any Underwriter or Underwriters
so default and the aggregate number of shares of Offered Securities with respect to which such
default or defaults occur exceeds 10% of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date and arrangements satisfactory to Credit
Suisse and the Company for the purchase of such Offered Securities by other persons are not made
within 36 hours after such default, this Agreement will terminate without liability on the part of
any non-defaulting Underwriter or the Company, except as provided in Section 10 (provided that if
such default occurs with respect to Optional Securities after the First Closing Date, this
Agreement will not terminate as to the Firm Securities or any Optional Securities purchased prior
to such termination). As used in this Agreement, the term “Underwriter” includes any person
substituted for an Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
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10. Survival of Certain Representations and Obligations. The respective indemnities,
agreements, representations, warranties and other statements of the Company or its officers and of
the several Underwriters set forth in or made pursuant to this Agreement will remain in full force
and effect, regardless of any investigation, or statement as to the results thereof, made by or on
behalf of any Underwriter, the Company or any of their respective representatives, officers or
directors or any controlling person, and will survive delivery of and payment for the Offered
Securities. If the purchase of the Offered Securities by the Underwriters is not consummated for
any reason other than solely because of the termination of this Agreement pursuant to Section 9
hereof, the Company will reimburse the Underwriters for all out-of-pocket expenses (including fees
and disbursements of counsel) reasonably incurred by them in connection with the offering of the
Offered Securities, and the respective obligations of the Company and the Underwriters pursuant to
Section 8 hereof shall remain in effect. In addition, if any Offered Securities have been purchased
hereunder, the representations and warranties in Section 2 and all obligations under Section 5
shall also remain in effect.
11. Notices. All communications hereunder will be in writing and, if sent to the
Underwriters, will be mailed, delivered or telegraphed and confirmed to the Representative, c/o
Credit Suisse Securities (USA) LLC, Eleven Madison Avenue, New York, N.Y. 10010-3629, Attention:
LCD-IBD, or, if sent to the Company, will be mailed, delivered or telegraphed and confirmed to it
at 0000 Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000, Attention: J. Xxxxx Xxxxx, Xx.; provided,
however, that any notice to an Underwriter pursuant to Section 8 will be mailed, delivered or
telegraphed and confirmed to such Underwriter.
12. Successors. This Agreement will inure to the benefit of and be binding upon the parties
hereto and their respective successors and the officers and directors and controlling persons
referred to in Section 8, and no other person will have any right or obligation hereunder.
13. Representation of Underwriters. The Representative will act for the several Underwriters
in connection with the transactions contemplated by this Agreement, and any action under this
Agreement taken by the Representative jointly or by Credit Suisse will be binding upon all the
Underwriters.
14. 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.
15. Absence of Fiduciary Relationship. The Company acknowledges and agrees that:
(a) No Other Relationship. The Representative has been retained solely to act as
an underwriter in connection with the sale of Offered Securities and that no fiduciary,
advisory or agency relationship between the Company and the Representative has been
created in respect of any of the transactions contemplated by this Agreement or the
Final Prospectus, irrespective of whether the Representative has advised or is advising
the Company on other matters;
(b) Arms’ Length Negotiations. The price of the Offered Securities set forth in
this Agreement was established by the Company following discussions and arms’ length
negotiations with the Representative and the Company is capable of evaluating and
understanding and understands and accepts the terms, risks and conditions of the
transactions contemplated by this Agreement;
(c) Absence of Obligation to Disclose. The Company has been advised that the
Representative and its affiliates are engaged in a broad range of transactions which may
involve interests that differ from those of the Company and that the Representative has
no obligation to disclose such interests and transactions to the Company by virtue of
any fiduciary, advisory or agency relationship; and
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(d) Waiver. The Company waives, to the fullest extent permitted by law, any claims
it may have against the Representative for breach of fiduciary duty or alleged breach of
fiduciary duty and agrees that the Representative shall have no liability (whether
direct or indirect) to the Company in respect of such a fiduciary duty claim or to any
person asserting a fiduciary duty claim on behalf of or in right of the Company,
including stockholders, employees or creditors of the Company.
16. Applicable Law. This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York.
The Company hereby submits to the non-exclusive jurisdiction of the Federal and state courts in the
Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating
to this Agreement or the transactions contemplated hereby. The Company irrevocably and
unconditionally waives any objection to the laying of venue of any suit or proceeding arising out
of or relating to this Agreement or the transactions contemplated hereby in Federal and state
courts in the Borough of Manhattan in The City of New York and irrevocably and unconditionally
waives and agrees not to plead or claim in any such court that any such suit or proceeding in any
such court has been brought in an inconvenient forum.
- 20 -
If the foregoing is in accordance with the Representative’s understanding of our agreement, kindly
sign and return to the Company one of the counterparts hereof, whereupon it will become a binding
agreement between the Company and the several Underwriters in accordance with its terms.
| Very truly yours, | ||||||
| NANOSPHERE, INC., | ||||||
| by | ||||||
| Name: | ||||||
| Title: | ||||||
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above
written.
confirmed and accepted as of the date first above
written.
Acting on behalf of itself and as the
Representative of the several Underwriters.
Representative of the several Underwriters.
CREDIT SUISSE SECURITIES (USA) LLC
By:
Name:
Title:
Title:
- 21 -
SCHEDULE A
| Number of | ||
| Underwriter | Firm Securities | |
Credit Suisse Securities (USA) LLC
|
[•] | |
Xxxxx Xxxxxxx & Co.
|
[•] | |
Leerink Xxxxx LLC
|
[•] | |
Xxxxx & Company LLC
|
[•] | |
Total
|
[•] | |
SCHEDULE B
1. General Use Free Writing Prospectuses (included in the General Disclosure Package)
“General Use Issuer Free Writing Prospectus” includes each of the following documents:
[ ]
2. Other Information Included in the General Disclosure Package
The following information is also included in the General Disclosure Package:
1. The initial price to the public of the Offered Securities.
