UNDERWRITING AGREEMENT
Exhibit
1.1
2,000,000 Shares of Series D Preferred Stock
December
18, 2020
XXXXXXXXX
LLC
XXXXXXX
XXXXX & COMPANY, L.L.C.
As
Representatives of the several Underwriters
c/o
JEFFERIES LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
c/o
XXXXXXX XXXXX & COMPANY, L.L.C.
000
Xxxxx Xxxxxxxxx Xxxxx
Xxxxxxx,
Xxxxxxxx 00000
Ladies
and Gentlemen:
VistaGen
Therapeutics, Inc., a Nevada corporation (the “Company”), proposes to issue and
sell to the several underwriters named in Schedule
A (the “Underwriters”) an aggregate of
63,000,000 shares of the Company’s common stock, par value
$0.001 per share (the “Common
Stock”) and 2,000,000 shares of the Company’s
Series D convertible preferred stock (the “Preferred Stock” and together with
the Common Stock, the “Securities”). Xxxxxxxxx LLC
(“Jefferies”)
and Xxxxxxx Xxxxx & Company, L.L.C. (“Xxxxxxx Xxxxx”) agreed to act as
representatives of the several Underwriters (in such capacity, the
“Representatives”) in connection
with the offering and sale of the Securities. To the extent there
are no additional underwriters listed on Schedule
A, the term “Representatives” as used herein
shall mean you, as Underwriters, and the term
“Underwriters” shall mean either the singular or the
plural, as the context requires.
Each
share of the Preferred Stock shall be initially convertible into 23
shares of Common Stock at any time at the option of the holder,
provided that the Preferred
Stock shall not be convertible prior to the date on which the
Company has received approval by its stockholders to increase the
total authorized shares of Common Stock by at least the amount
necessary to reserve Common Stock sufficient to satisfy the
Company’s conversion obligations in respect of the Preferred
Stock, provided further,
that the holder will be prohibited, subject to certain exceptions,
from converting the Preferred Stock into shares of Common Stock if,
as a result of such conversion, the holder, together with its
affiliates and other attribution parties, would own more than 9.99%
of the total number of shares of the Company’s Common Stock
then issued and outstanding, which percentage may be changed at the
holder’s election to a lower percentage at any time or a
higher percentage not to exceed 19.99% upon 61 days’ notice
to the Company.
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The
Company has prepared and filed with the Securities and Exchange
Commission (the “Commission”) a shelf registration
statement on Form S-3, File No. 333-234025, including a
base prospectus (the “Base
Prospectus”) to be used in connection with the public
offering and sale of the Securities. Such registration statement,
as amended, including the financial statements, exhibits and
schedules thereto, in the form in which it became effective under
the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder (collectively, the
“Securities
Act”), including all documents incorporated or deemed
to be incorporated by reference therein and any information deemed
to be a part thereof at the time of effectiveness pursuant to
Rule 430A or 430B under the Securities Act, is called the
“Registration
Statement.” Any registration statement filed by the
Company pursuant to Rule 462(b) under the Securities Act in
connection with the offer and sale of the Securities is called the
“Rule 462(b) Registration
Statement,” and from and after the date and time of
filing of any such Rule 462(b) Registration Statement the term
“Registration Statement” shall include the Rule 462(b)
Registration Statement. The preliminary prospectus supplement dated
December 17, 2020 describing the Securities and the offering
thereof (the “Preliminary
Prospectus Supplement”), together with the Base
Prospectus, is called the “Preliminary Prospectus,” and the
Preliminary Prospectus and any other prospectus supplement to the
Base Prospectus in preliminary form that describes the Securities
and the offering thereof and is used prior to the filing of the
Prospectus (as defined below), together with the Base Prospectus,
is called a “preliminary
prospectus.” As used herein, the term
“Prospectus”
shall mean the final prospectus supplement to the Base Prospectus
that describes the Securities and the offering thereof (the
“Final Prospectus
Supplement”), together with the Base Prospectus, in
the form first used by the Underwriters to confirm sales of the
Securities or in the
form first made available to the Underwriters by the Company to
meet requests of purchasers pursuant to Rule 173 under the
Securities Act. References herein to the Preliminary Prospectus,
any preliminary prospectus and the Prospectus shall refer to both
the prospectus supplement and the Base Prospectus components of
such prospectus. As used herein, “Applicable Time” is 8:00 a.m. (New
York City time) on December 18, 2020. As used herein,
“free writing
prospectus” has the meaning set forth in Rule 405
under the Securities Act, and “Time of Sale Prospectus” means the
Preliminary Prospectus, as amended or supplemented immediately
prior to the Applicable Time, together with the free writing
prospectuses, if any, identified in Schedule B hereto. As used
herein, “Road
Show” means a “road show” (as defined in
Rule 433 under the Securities Act) relating to the offering of the
Securities contemplated hereby that is a “written
communication” (as defined in Rule 405 under the Securities
Act). As used herein, “Rule
163B Written Communication” means each written
communication (within the meaning of Rule 405 under the Securities
Act) that is made in reliance on Rule 163B under the Securities Act
by the Company or any person authorized to act on behalf of the
Company to one or more potential investors that are, or are
reasonably believed to be, qualified institutional buyers
(“QIBs”) and/or
institutions that are, or are reasonably believed to be, accredited
investors (“IAIs”), as such terms are
respectively defined in Rule 144A and Rule 501(a) under the
Securities Act, to determine whether such investors might have an
interest in the offering of the Securities; “Rule 163B Oral Communication”
means each oral communication, if any, made in reliance on Rule
163B under the Securities Act by the Company or any person
authorized to act on behalf of the Company made to one or more QIBs
and/or one or more IAIs to determine whether such investors might
have an interest in the offering of the Securities;
“Marketing
Materials” means 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 Securities, including any
roadshow or investor presentations made to investors by the Company
(whether in person or electronically); and “Permitted Rule 163B Communication”
means the Rule 163B Written Communication(s) and Marketing
Materials listed on Schedule C attached hereto.
All
references in this Agreement to the Registration Statement, the
Preliminary Prospectus, any preliminary prospectus, the Base
Prospectus and the Prospectus shall include the documents
incorporated or deemed to be incorporated by reference therein. All
references in this Agreement to financial statements and schedules
and other information which are “contained,”
“included” or “stated” in, or “part
of” the Registration Statement, the Rule 462(b) Registration
Statement, the Preliminary Prospectus, any preliminary prospectus,
the Base Prospectus, the Time of Sale Prospectus or the Prospectus,
and all other references of like import, shall be deemed to mean
and include all such financial statements and schedules and other
information which is or is deemed to be incorporated by reference
in the Registration Statement, the Rule 462(b) Registration
Statement, the Preliminary Prospectus, any preliminary prospectus,
the Base Prospectus, the Time of Sale Prospectus or the Prospectus,
as the case may be. All references in this Agreement to amendments
or supplements to the Registration Statement, the Preliminary
Prospectus, any preliminary prospectus, the Base Prospectus, the
Time of Sale Prospectus or the Prospectus shall be deemed to mean
and include the filing of any document under the Securities
Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder (collectively, the “Exchange Act”) that is or is
deemed to be incorporated by reference in the Registration
Statement, the Preliminary Prospectus, any preliminary prospectus,
the Base Prospectus, or the Prospectus, as the case may be. All
references in this Agreement to (i) the Registration
Statement, the Preliminary Prospectus, any preliminary prospectus,
the Base Prospectus or the Prospectus, any amendments or
supplements to any of the foregoing, or any free writing
prospectus, shall include any copy thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval System (“XXXXX”) and (ii) the
Prospectus shall be deemed to include any “electronic
Prospectus” provided for use in connection with the offering
of the Securities as contemplated by Section 3(n) of this
Agreement.
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The
Company hereby confirms its agreements with the Underwriters as
follows:
The
Company hereby represents, warrants and covenants to each
Underwriter, as of the date of this Agreement, as of the Closing
Date (as hereinafter defined), as follows:
(a) Compliance
with Registration Requirements. The Registration Statement has become
effective under the Securities Act. The Company has complied, to
the Commission’s satisfaction, with all requests of the
Commission for additional or supplemental information, if any. No
stop order suspending the effectiveness of the Registration
Statement is in effect and no proceedings for such purpose have
been instituted or are pending or, to the knowledge of the Company,
are contemplated or threatened by the Commission. At the time the
Company’s Annual Report on Form 10-K for the fiscal year
ended March 31, 2020 (the “Annual Report”) was filed with the
Commission, or, if later, at the time the Registration Statement
was originally filed with the Commission, the Company met the
then-applicable requirements for use of Form S-3 under the
Securities Act. The Company meets the requirements for use of Form
S-3 under the Securities Act. The documents incorporated or deemed
to be incorporated by reference in the Registration Statement, the
Time of Sale Prospectus and the Prospectus, at the time they were
or hereafter are filed with the Commission, or became effective
under the Exchange Act, as the case may be, complied and will
comply, in all material respects, with the requirements of the
Exchange Act.
(b) Disclosure.
Each preliminary prospectus and the Prospectus when filed complied,
in all material respects, with the Securities Act and, if filed by
electronic transmission pursuant to XXXXX, was identical (except as
may be permitted by Regulation S-T under the Securities Act)
to the copy thereof delivered to the Underwriters for use in
connection with the offer and sale of the Securities. Each of the
Registration Statement and any post-effective amendment thereto, at
the time it became or becomes effective, complied and will comply,
in all material respects, with the Securities Act and did not and
will not contain any 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. As of the Applicable
Time, the Time of Sale Prospectus did not, and at the Closing Date
(as defined in Section 2), will
not, contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading. The Prospectus, as of its date, did not, and at the
Closing Date, will not, contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading. The representations and
warranties set forth in the three immediately preceding sentences
do not apply to statements in or omissions from the Registration
Statement or any post-effective amendment thereto, or the
Prospectus or the Time of Sale Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with
written information relating to any Underwriter furnished to the
Company in writing by the Representatives expressly for use
therein, it being understood and agreed that the only such
information consists of the information described in Section 9(b) below. There are no
contracts or other documents required to be described in the Time
of Sale Prospectus or the Prospectus or to be filed as an exhibit
to the Registration Statement which have not been described or
filed as required.
(c) Free
Writing Prospectuses; Road Show. As of the determination date
referenced in Rule 164(h) under the Securities Act, the Company was
not, is not or will not be (as applicable) an “ineligible
issuer” in connection with the offering of the Securities
pursuant to Rules 164, 405 and 433 under the Securities Act. Each
free writing prospectus that the Company is required to file
pursuant to Rule 433(d) under the Securities Act has been, or will
be, filed with the Commission in accordance with the requirements
of the Securities Act. Each free writing prospectus that the
Company has filed, or is required to file, pursuant to Rule 433(d)
under the Securities Act or that was prepared by or on behalf of or
used or referred to by the Company complies or will comply in all
material respects with the requirements of Rule 433 under the
Securities Act, including timely filing with the Commission,
retention and legending, as applicable, and each such free writing
prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the
Securities did not, does not and will not include any information
that conflicted, conflicts or will conflict with the information
contained in the Registration Statement, the Prospectus or any
preliminary prospectus unless such information has been superseded
or modified as of such time. Except for the free writing
prospectuses, if any, identified in Schedule B, and electronic road
shows, if any, furnished to you before first use, the Company has
not prepared, used or referred to, and will not, without your prior
written consent, which consent shall not be unreasonably withheld,
prepare, use or refer to, any free writing prospectus. Each Road
Show, when considered together with the Time of Sale Prospectus,
did not, as of the Applicable Time, contain any untrue statement of
a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading.
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(d) Distribution
of Offering Material By the Company. Prior to the completion of the
Underwriters’ distribution of the Securities, the Company has not distributed and
will not distribute any offering material in connection with the
offering and sale of the Securities other than the Registration
Statement, the Time of Sale Prospectus, the Prospectus or any free
writing prospectus reviewed and consented to by the
Representatives, which consent shall not be unreasonably withheld,
the free writing prospectuses, if any, identified on Schedule B hereto and any
Permitted Rule 163B Communications.
(e) The
Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(f) Authorization
of the Common Stock.
The shares of Common Stock have been duly authorized by the Company
for issuance and sale pursuant to this Agreement and, when issued
and delivered by the Company against payment for the shares of
Common Stock included in the Securities pursuant to this Agreement,
will be validly issued, fully paid and nonassessable, and the
issuance and sale of the shares of Common Stock will not be subject
to any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase the shares of Common
Stock.
(g) Authorization
of the Preferred Stock. The shares of Preferred Stock have
been duly authorized by the Company for issuance and sale pursuant
to this Agreement and, when issued and delivered by the Company
against payment for the shares of Preferred Stock pursuant to this
Agreement, will be validly issued, fully paid and nonassessable,
and the issuance and sale of the shares of Preferred Stock will not
subject to any preemptive rights, rights of first refusal or other
similar rights to subscribe for or purchase the Preferred
Stock.
(h) Authorization
of the Common Stock Issuable Upon Conversion of the Preferred
Stock. The shares of
Common Stock issuable upon conversion of the Preferred Stock will
be duly authorized by the Company and reserved for issuance upon
conversion thereof upon the Company’s receiving the requisite
approval from the holders of its voting securities (the
“Required Stockholder
Approval”) to amend the Company’s Restated and
Amended Articles of Incorporation (the “Articles of Incorporation”) to
increase the number of authorized and unissued shares of Common
Stock by an amount sufficient for the Company to deliver shares of
Common Stock upon conversion of each share of Preferred Stock in
accordance with the provisions of the Certificate of Designations
for the Preferred Stock (the “Certificate of Designations”) and,
assuming that the Required Stockholder Approval has been obtained,
when such shares of Common Stock are issued and delivered by the
Company in accordance with the provisions of the Certificate of
Designations, such shares of Common Stock will be validly issued,
fully paid and non-assessable, and the issuance of such shares of
Common Stock will not be subject to any preemptive rights, rights
of first refusal or other similar rights. The Company has, to the
fullest extent permitted under the Articles of Incorporation (and
subject to the Required Stockholder Approval), reserved from its
duly authorized capital stock the maximum number of shares of
Common Stock issuable pursuant to this Agreement and the
Certificate of Designations, subject to the Required Stockholder
Approval with respect to the shares of Common Stock issuable upon
conversion of the Preferred Stock.
(i) No
Applicable Registration or Other Similar Rights. There are no persons with registration
or other similar rights to have any equity or debt securities
registered for sale under the Registration Statement or included in
the offering contemplated by this Agreement, except for such rights
as have been duly waived.
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(j) No
Material Adverse Change. Except as otherwise disclosed in the
Registration Statement, the Time of Sale Prospectus and the
Prospectus, subsequent to the respective dates as of which
information is given in the Registration Statement, the Time of
Sale Prospectus and the Prospectus: (i) there has been no
material adverse change, or any development that could be expected
to result in a material adverse change, in (A) the condition,
financial or otherwise, or in the earnings, business, properties,
operations, operating results, assets, liabilities or prospects,
whether or not arising from transactions in the ordinary course of
business, of the Company and its subsidiaries, considered as one
entity or (B) the ability of the Company to consummate the
transactions contemplated by this Agreement or perform its
obligations hereunder (any such change being referred to herein as
a “Material Adverse
Change”); (ii) the Company and its subsidiaries,
considered as one entity, have not incurred any material liability
or obligation, indirect, direct or contingent, including without
limitation any losses or interference with their business from
fire, explosion, flood, earthquakes, accident or other calamity,
whether or not covered by insurance, or from any strike, labor
dispute or court or governmental action, order or decree, that are
material, individually or in the aggregate, to the Company and its
subsidiaries, considered as one entity, and have not entered into
any material transactions not in the ordinary course of business;
and (iii) there has not been any material decrease in the
capital stock or any material increase in any short-term or
long-term indebtedness of the Company or its subsidiaries and there
has been no dividend or distribution of any kind declared, paid or
made by the Company or, except for dividends paid to the Company or
other subsidiaries, by any of the Company’s subsidiaries on
any class of capital stock, or any repurchase or redemption by the
Company or any of its subsidiaries of any class of capital
stock.
(k) Independent
Accountants. OUM
& Co. LLP, which has expressed its opinion with respect to the
consolidated financial statements (which term as used in this
Agreement includes the related notes thereto) filed with the
Commission as a part of the Registration Statement, the Time of
Sale Prospectus and the Prospectus, is (i) an independent
registered public accounting firm as required by the Securities
Act, the Exchange Act, and the rules of the Public Company
Accounting Oversight Board (“PCAOB”), (ii) in compliance with
the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X under the Securities
Act and (iii) a registered public accounting firm as defined by the
PCAOB whose registration has not been suspended or revoked and who
has not requested such registration to be withdrawn.
(l) Financial
Statements. The
financial statements filed with the Commission as a part of the
Registration Statement, the Time of Sale Prospectus and the
Prospectus present fairly, in all material respects, the
consolidated financial position of the Company and its subsidiaries
as of the dates indicated and the results of their operations,
changes in stockholders’ equity and cash flows for the
periods specified. The supporting schedules included in the
Registration Statement present fairly the information required to
be stated therein. Such financial statements and supporting
schedules have been prepared in conformity with generally accepted
accounting principles as applied in the United States applied on a
consistent basis throughout the periods involved, except as may be
expressly stated in the related notes thereto. The interactive data
in eXtensible Business Reporting Language included or incorporated
by reference in the Registration Statement 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. No other financial statements or
supporting schedules are required to be included in the
Registration Statement, the Time of Sale Prospectus or the
Prospectus. The financial data set forth in each of the
Registration Statement, the Time of Sale Prospectus and the
Prospectus under the caption “Capitalization” fairly
present, in all material respects, the information set forth
therein on a basis consistent with that of the audited financial
statements contained in the Registration Statement, the Time of
Sale Prospectus and the Prospectus. All disclosures contained in
the Registration Statement, any preliminary prospectus, the
Prospectus and any free writing prospectus that constitute non-GAAP
financial measures (as defined by the rules and regulations under
the Securities Act and the Exchange Act) comply with Regulation G
under the Exchange Act and Item 10 of Regulation S-K under the
Securities Act, as applicable. To the Company’s knowledge, no
person who has been suspended or barred from being associated with
a registered public accounting firm, or who has failed to comply
with any sanction pursuant to Rule 5300 promulgated by the PCAOB,
has participated in or otherwise aided the preparation of, or
audited, the financial statements, supporting schedules or other
financial data filed with the Commission as a part of the
Registration Statement, the Time of Sale Prospectus and the
Prospectus.
-5-
(m) Company’s
Accounting System.
The Company and each of its subsidiaries make and keep books and
records that are accurate, in all material respects, and maintain a
system of internal accounting controls sufficient to provide
reasonable assurance that: (i) transactions are executed in
accordance with management’s general or specific
authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles as applied in the United
States and to maintain accountability for assets; (iii) access
to assets is permitted only in accordance with management’s
general or specific authorization; (iv) the recorded
accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect
to any differences; and (v) the interactive data in eXtensible
Business Reporting Language included or incorporated by reference
in the Registration Statement, the Time of Sale Prospectus 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.
(n) Disclosure
Controls and Procedures; Deficiencies in or Changes to Internal
Control Over Financial Reporting. The Company has established and
maintains disclosure controls and procedures (as defined in
Rules 13a-15 and 15d-15 under the Exchange Act), which (i) are
designed to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to
the Company’s principal executive officer and its principal
financial officer by others within those entities, particularly
during the periods in which the periodic reports required under the
Exchange Act are being prepared; (ii) have been evaluated by
management of the Company for effectiveness as of the end of the
Company’s most recent fiscal quarter; and (iii) are effective
in all material respects to perform the functions for which they
were established. Other than as disclosed in the Registration
Statement, the Time of Sale Prospectus and the Prospectus, since
the end of the Company’s most recent audited fiscal year,
there have been no significant deficiencies or material weakness in
the Company’s internal control over financial reporting
(whether or not remediated) and 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 (as
defined in Rule 13a-15(f) under the Exchange Act). The Company is
not aware of any change in its internal control over financial
reporting that has occurred during its most recent fiscal quarter
that has materially affected, or is reasonably likely to materially
affect, the Company’s internal control over financial
reporting.
(o) Incorporation
and Good Standing of the Company. The Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation 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 Time of Sale Prospectus and the Prospectus and to enter into
and perform its obligations under this Agreement. The Company is
duly qualified as a foreign corporation to transact business and is
in good standing in the State of jurisdiction of its principal
place of business and 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 qualify would not reasonably be expected to result in a
Material Adverse Change.
(p) Subsidiaries.
Each of the Company’s “subsidiaries” (for
purposes of this Agreement, as defined in Rule 405 under the
Securities Act) has been duly incorporated or organized, as the
case may be, and is validly existing as a corporation, partnership
or limited liability company, as applicable, in good standing under
the laws of the jurisdiction of its incorporation or organization
and has the power and authority (corporate or other) to own, lease
and operate its properties and to conduct its business as described
in the Registration Statement, the Time of Sale Prospectus and the
Prospectus. Each of the Company’s subsidiaries is duly
qualified as a foreign corporation, partnership or limited
liability company, as applicable, to transact business and is in
good standing in each 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 qualify
would not reasonably be expected to result in a Material Adverse
Change. All of the issued and outstanding capital stock or other
equity or ownership interests of each of the Company’s
subsidiaries have been duly authorized and validly issued, are
fully paid and nonassessable and are owned by the Company, directly
or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance or adverse claim. None of the outstanding
capital stock or equity interest in any subsidiary was issued in
violation of preemptive or similar rights of any security holder of
such subsidiary. The constitutive or organizational documents of
each of the subsidiaries comply, in all material respects, with the
requirements of applicable laws of its jurisdiction of
incorporation or organization and are in full force and
effect. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than
the subsidiaries listed in Schedule D hereto.
-6-
(q) Capitalization
and Other Capital Stock Matters. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Registration
Statement, the Time of Sale Prospectus and the Prospectus under the
caption “Capitalization” (other than for subsequent
issuances, if any, pursuant to employee benefit plans, or upon the
exercise of outstanding options or warrants, in each case described
in the Registration Statement, the Time of Sale Prospectus and the
Prospectus). The share capital of the Company conforms, in all
material respects, to the description thereof contained in the Time
of Sale Prospectus. All of the issued and outstanding securities of
the Company have been duly authorized and validly issued, are fully
paid and nonassessable and have been issued in compliance with all
federal and state securities laws. None of the outstanding
securities was issued in violation of any preemptive rights, rights
of first refusal or other similar rights to subscribe for or
purchase securities of the Company. There are no authorized or
outstanding options, warrants, preemptive rights, rights of first
refusal or other rights to purchase, or equity or debt securities
convertible into or exchangeable or exercisable for, any capital
stock of the Company or any of its subsidiaries other than those
described in the Registration Statement, the Time of Sale
Prospectus and the Prospectus. The descriptions of the
Company’s stock option, stock bonus and other stock plans or
arrangements, and the options or other rights granted thereunder,
set forth in the Registration Statement, the Time of Sale
Prospectus and the Prospectus accurately and fairly presents, in
all material respects, the information required to be shown with
respect to such plans, arrangements, options and
rights.
(r) Stock
Exchange Listing. The
shares of Common Stock are registered pursuant to Section 12(b) or
12(g) of the Exchange Act and are listed on the Nasdaq Capital
Market (the “Nasdaq”), and the Company has
taken no action designed to, or likely to have the effect of,
terminating the registration of the shares of Common Stock under
the Exchange Act or delisting the shares of Common Stock from the
Nasdaq, nor, except as otherwise disclosed in the Registration
Statement, the Time of Sale Prospectus and the Prospectus, has the
Company received any notification that the Commission or the Nasdaq
is contemplating terminating such registration or listing. Except
as otherwise disclosed in the Registration Statement, the Time of
Sale Prospectus and the Prospectus, to the Company’s
knowledge, it is in compliance with all applicable listing
requirements of Nasdaq.
(s) Non-Contravention
of Existing Instruments; No Further Authorizations or Approvals
Required. Neither the
Company nor any of its subsidiaries is in violation of its charter
or by-laws, partnership agreement or operating agreement or similar
organizational documents, as applicable, or is in default (or, with
the giving of notice or lapse of time, would be in default)
(“Default”)
under any indenture, loan, credit agreement, note, lease, license
agreement, contract, franchise or other instrument (including,
without limitation, any pledge agreement, security agreement,
mortgage or other instrument or agreement evidencing, guaranteeing,
securing or relating to indebtedness) to which the Company or any
of its subsidiaries is a party or by which it or any of them may be
bound, or to which any of their respective properties or assets are
subject (each, an “Existing
Instrument”), except for such Defaults as would not be
reasonably expected, individually or in the aggregate, to result in
a Material Adverse Change. The Company’s execution, delivery
and performance of this Agreement, consummation of the transactions
contemplated hereby and by the Registration Statement, the Time of
Sale Prospectus and the Prospectus and the issuance and sale of the
Securities (including the use of proceeds from the sale of the
Securities as described in the Registration Statement, the Time of
Sale Prospectus and the Prospectus under the caption “Use of
Proceeds”) (i) have been duly authorized by all
necessary corporate action and will not result in any violation of
the provisions of the charter or by-laws, partnership agreement or
operating agreement or similar organizational documents, as
applicable, of the Company or any subsidiary (ii) will not
conflict with or constitute a breach of, or Default or a Debt
Repayment Triggering Event (as defined below) under, or result in
the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries
pursuant to, or require the consent of any other party to, any
Existing Instrument and (iii) will not result in any violation
of any law, administrative regulation or administrative or court
decree applicable to the Company or any of its subsidiaries, except
for such conflicts, breaches or violations specified in subsection
(ii) and (iii) above that would not reasonably be expected to
result in a Material Adverse Change. Except as otherwise disclosed
in the Registration Statement, the Time of Sale Prospectus and the
Prospectus, no consent, approval, authorization or other order of,
or registration or filing with, any court or other governmental or
regulatory authority or agency, is required for the Company’s
execution, delivery and performance of this Agreement and
consummation of the transactions contemplated hereby and by the
Registration Statement, the Time of Sale Prospectus and the
Prospectus, except such as have been obtained or made by the
Company and are in full force and effect under the Securities Act
and such as may be required under applicable state securities or
blue sky laws or the Financial Industry Regulatory Authority, Inc.
(“FINRA”). As
used herein, a “Debt
Repayment Triggering Event” means any event or
condition which 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 or any of its subsidiaries.
-7-
(t) Compliance
with Laws. The Company and its subsidiaries have been,
during the past three (3) years, and are in compliance with all
applicable laws, rules and regulations, except where failure to be
so in compliance would not reasonably be expected, individually or
in the aggregate, to result in a Material Adverse
Change.
(u) No
Material Actions or Proceedings. There is no action, suit, proceeding,
inquiry or investigation brought by or before any legal or
governmental entity now pending or, to the knowledge of the
Company, threatened, against or affecting the Company or any of its
subsidiaries, that would reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Change. No labor
dispute with the employees of the Company or any of its
subsidiaries, or with the employees of any principal supplier,
manufacturer, customer or contractor of the Company, exists or, to
the knowledge of the Company, is threatened or imminent, except as
would not reasonably be expected to result in a Material Adverse
Change.
(v) Intellectual
Property Rights. The
Company and its subsidiaries own, or have obtained valid and
enforceable licenses for, the inventions, patent applications,
patents, trademarks, trade names, service names, copyrights, trade
secrets and other intellectual property described in the
Registration Statement, the Time of Sale Prospectus and the
Prospectus as being owned or licensed by them or used in the
conduct of their respective businesses as currently conducted or as
currently proposed to be conducted (collectively,
“Intellectual
Property”). To the Company’s knowledge, the
conduct of their respective businesses does not and will not
infringe, misappropriate or otherwise conflict in any material
respect with any intellectual property rights of others, except as
would not be reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Change. The Intellectual
Property of the Company has not been adjudged by a court of
competent jurisdiction to be invalid or unenforceable, in whole or
in part, and the Company is unaware of any facts which, in the
Company’s opinion, would form a reasonable basis for any such
adjudication. To the Company's knowledge, except as otherwise
described in the Registration Statement, the Time of Sale
Prospectus and the Prospectus: (i) there are no third parties who
have rights to any Intellectual Property, except for customary
reversionary rights of third-party licensors with respect to
Intellectual Property that is disclosed in the Registration
Statement, the Time of Sale Prospectus and the Prospectus as
licensed to the Company or one or more of its subsidiaries; and
(ii) there is no infringement by third parties of any Intellectual
Property, except, for each of (i) and (ii), as would not be
reasonably be expected, individually or in the aggregate, to result
in a Material Adverse Change. There is no pending or, to the
Company’s knowledge, threatened action, suit, proceeding or
claim by third parties: (A) challenging the Company’s
and its subsidiaries’ rights in or to any Intellectual
Property, and the Company is unaware of any facts which, in the
Company’s opinion, would form a reasonable basis for any such
action, suit, proceeding or claim; (B) challenging the validity,
enforceability or scope of any Intellectual Property, and the
Company is unaware of any facts which, in the Company’s
opinion, would form a reasonable basis for any such action, suit,
proceeding or claim; or (C) asserting that the Company or any of
its subsidiaries infringes or otherwise violates, or would, upon
the commercialization of any product or service described in the
Registration Statement, the Time of Sale Prospectus or the
Prospectus as under development, infringe or violate, any patent,
trademark, trade name, service name, copyright, trade secret or
other proprietary rights of third parties, and the Company is
unaware of any facts which, in the Company’s opinion, would
form a reasonable basis for any such action, suit, proceeding or
claim; in each case of (A), (B) and (C), except as would not
reasonably be expected to result in a Material Adverse Change. The
Company and its subsidiaries have complied with the terms of each
agreement pursuant to which Intellectual Property has been licensed
to the Company or any subsidiary, and all such agreements are in
full force and effect, except when the failure to be in compliance
would not reasonably be expected to result in a Material Adverse
Change. To the Company’s knowledge, there are no defects in
any of the patents or patent applications included in the
Intellectual Property, except as would not reasonably be expected
to result in a Material Adverse Change. To the Company’s
knowledge, the Company and its subsidiaries have taken all
reasonable steps to protect, maintain and safeguard the
Intellectual Property, including the execution of appropriate
nondisclosure or confidentiality agreements and invention
assignment agreements with their employees, and to the
Company’s knowledge, no current employee of the Company
involved in the development of Intellectual Property is in or has
been in violation of any material term of any employment contract,
patent disclosure agreement, invention assignment agreement,
non-competition agreement, non-solicitation agreement,
nondisclosure agreement, or any restrictive covenant to or with a
former employer where the basis of such violation relates to such
employee’s employment with the Company, in each case except
when the failure to be in compliance would not reasonably be
expected to result in a Material Adverse Change. To the
Company’s knowledge, the duty of candor and good faith as
required by the United States Patent and Trademark Office during
the prosecution of the United States patents and patent
applications included in the Intellectual Property has been
complied with in all material respects; and in all foreign offices
having similar requirements, all such requirements have been
complied with in all material respects, in each case except when
the failure to be in compliance would not reasonably be expected to
result in a Material Adverse Change. To the knowledge of the
Company, none of the Company owned Intellectual Property or
technology (including information technology and outsourced
arrangements) employed by the Company or its subsidiaries in the
conduct of their respective businesses has been obtained or is
being used by the Company or its subsidiaries in violation of any
contractual obligation binding on the Company or its subsidiaries
or any of their respective officers, directors or employees or
otherwise in violation of the rights of any persons. The product
candidates described in the Registration Statement, the Time of
Sale Prospectus and the Prospectus as under development by the
Company or any subsidiary fall within the scope of the claims of
one or more patents and/or pending patent applications owned by, or
exclusively licensed to, the Company or its
subsidiaries.
-8-
(w) All
Necessary Permits, etc. The Company and its subsidiaries
possess such valid and current certificates, authorizations or
permits required by state, federal or foreign regulatory agencies
or bodies to conduct their respective businesses as currently
conducted and as described in the Registration Statement, the Time
of Sale Prospectus or the Prospectus (“Permits”), except where the
failure to so possess would not reasonably be expected to result in
a Material Adverse Change. Neither the Company nor any of its
subsidiaries is in violation of, or in default under, any of the
Permits or has received any notice of proceedings relating to the
revocation or modification of, or non-compliance with, any such
certificate, authorization or permit, that, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would reasonably be expected to result in a Material
Adverse Change.
(x) Title
to Properties. Except
as otherwise disclosed in the Registration Statement, the Time of
Sale Prospectus and the Prospectus, the Company and its
subsidiaries have good and marketable title to all of the real and
personal property and other assets reflected as owned in the
financial statements referred to in Section 1(l) above (or
elsewhere in the Registration Statement, the Time of Sale
Prospectus or the Prospectus), in each case free and clear of any
security interests, mortgages, liens, encumbrances, equities,
adverse claims and other defects that would reasonably be expected
to result in a Material Adverse Change. The real property,
improvements, equipment and personal property held under lease by
the Company or any of its subsidiaries are held under valid and
enforceable leases, with such exceptions as are not material and do
not materially interfere with the use made or proposed to be made
of such real property, improvements, equipment or personal property
by the Company or such subsidiary.
(y) Tax
Law Compliance.
Except as (i) disclosed in the Registration Statement, the Time of
Sale Prospectus and the Prospectus or (ii) would not reasonably be
expected to result in a Material Adverse Change, the Company and
its subsidiaries have filed all necessary federal, state and
foreign income and franchise tax returns or have properly requested
extensions thereof and have paid all taxes required to be paid by
any of them and, if due and payable, any related or similar
assessment, fine or penalty levied against any of them except as
may be being contested in good faith and by appropriate
proceedings. The Company has made adequate charges, accruals and
reserves in the applicable financial statements referred to in
Section 1(l) above in respect of all material federal, state and
foreign income and franchise taxes applicable to the Company for
all periods as to which the tax liability of the Company or any of
its subsidiaries has not been finally determined.
(z) Insurance.
Each of the Company and its subsidiaries are insured by recognized,
financially sound and reputable institutions with policies in such
amounts and with such deductibles and covering such risks as are
generally deemed adequate and customary for their businesses
including, but not limited to, policies covering real and personal
property owned or leased by the Company and its subsidiaries
against theft, damage, destruction, acts of vandalism and policies
covering the Company and its subsidiaries for product liability
claims and clinical trial liability claims. The Company has no
reason to believe that it or any of its subsidiaries will not be
able (i) to renew its existing insurance coverage as and when
such policies expire or (ii) 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 Change.
Neither the Company nor any of its subsidiaries has been denied any
insurance coverage which it has sought or for which it has
applied.
(aa) Compliance with
Environmental Laws. Except as would not reasonably be
expected, individually or in the aggregate, to result in a Material
Adverse Change: (i) 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 (collectively, “Hazardous Materials”) or to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials
(collectively, “Environmental
Laws”); (ii) 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; (iii) 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 (iv) to the knowledge of the Company, there are
no events or circumstances that might 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
body or agency, against or affecting the Company or any of its
subsidiaries relating to Hazardous Materials or any Environmental
Laws.
-9-
(bb) [Reserved.]
(cc) ERISA
Compliance. The
Company and its subsidiaries and any “employee benefit
plan” (as defined under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (collectively, “ERISA”)) established or maintained
by the Company, its subsidiaries or their “ERISA
Affiliates” (as defined below) are in compliance in all
material respects with ERISA. “ERISA Affiliate” means, with
respect to the Company or any of its subsidiaries, any member of
any group of organizations described in Sections 414(b), (c),
(m) or (o) of the Internal Revenue Code of 1986, as amended, and
the regulations and published interpretations thereunder (the
“Code”) of which
the Company or such subsidiary is a member. Except as would not,
individually or in the aggregate, reasonably be expected to result
in a Material Adverse Change: (i) no “reportable event”
(as defined under ERISA) has occurred or is reasonably expected to
occur with respect to any “employee benefit plan”
established or maintained by the Company, its subsidiaries or any
of their ERISA Affiliates; (ii) no “employee benefit
plan” established or maintained by the Company, its
subsidiaries or any of their ERISA Affiliates, if such
“employee benefit plan” were terminated, would have any
“amount of unfunded benefit liabilities” (as defined
under ERISA); (iii) neither the Company, its subsidiaries nor any
of their ERISA Affiliates has incurred or reasonably expects to
incur (a) any liability under Title IV of ERISA with
respect to termination of, or withdrawal from, any “employee
benefit plan” or (b) any material liability
under Sections 412, 4971, 4975 or 4980B of the Code; and
(iv) each employee benefit plan established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates that is
intended to be qualified under Section 401(a) of the Code is
so qualified and, to the Company’s knowledge, nothing has
occurred, whether by action or failure to act, which would cause
the loss of such qualification.
(dd) Company
Not an “Investment Company.” The Company is not,
and will not be, either after receipt of payment for the Securities
or after the application of the proceeds therefrom as described
under “Use of Proceeds” in the Registration Statement,
the Time of Sale Prospectus or the Prospectus, required to register
as an “investment company” under the Investment Company
Act of 1940, as amended (the “Investment Company
Act”).
(ee) No
Price Stabilization or Manipulation; Compliance with Regulation
M. Neither the
Company nor any of its subsidiaries has taken, directly or
indirectly, any action designed to or that might cause or result in
stabilization or manipulation of the price of the Securities or of
any “reference security” (as defined in Rule 100 of
Regulation M under the Exchange Act (“Regulation M”)) with
respect to the Securities, whether to facilitate the sale or resale
of the Securities or otherwise, and has taken no action which would
directly or indirectly violate Regulation M.
(ff) Related-Party
Transactions. There
are no business relationships or related-party transactions
involving the Company or any of its subsidiaries or any other
person required to be described in the Registration Statement, the
Time of Sale Prospectus or the Prospectus that have not been
described as required.
(gg) FINRA
Matters. All of the
information provided to the Underwriters or to counsel for the
Underwriters by the Company, its counsel, its officers and
directors and the holders of any securities (debt or equity) or
options to acquire any securities of the Company in connection with
the offering of the Securities is true, complete, correct and
compliant with FINRA’s rules, in all material respects, and
any letters, filings or other supplemental information provided to
FINRA pursuant to FINRA Rules or NASD Conduct Rules is true,
complete and correct, in all material respects.
(hh) Parties to Lock-Up
Agreements. The
Company has furnished to the Underwriters a letter agreement in the
form attached hereto as Exhibit A (the
“Lock-up
Agreement”) from each of the persons listed on
Exhibit B.
Such Exhibit B
lists under an appropriate caption the directors and executive
officers of the Company. If any
additional persons shall become directors or executive
officers of the Company prior to the
end of the Company Lock-up Period (as defined below), the Company
shall cause each such person, prior to or contemporaneously
with their appointment or election as a director or executive
officer of the Company, to execute and
deliver to Jefferies a Lock-up Agreement.
-10-
(ii) Statistical
and Market-Related Data. All statistical, demographic and
market-related data included in the Registration Statement, the
Time of Sale Prospectus or the Prospectus are based on or derived
from sources that the Company believes, after reasonable inquiry,
to be reliable and accurate or represent the Company’s good
faith estimates that are made on the basis of data derived from
such sources. To the extent required, the Company has obtained the
written consent to the use of such data from such
sources.
(jj) Xxxxxxxx-Xxxxx
Act. There is, and has been, no failure on the part of the
Company or, to the Company’s knowledge, any of the
Company’s directors or officers, in their capacities as such,
to comply in all material respects with any applicable provision of
the Xxxxxxxx-Xxxxx Act of 2002, as amended and the rules and
regulations promulgated in connection therewith, including Section
402 related to loans and Sections 302 and 906 related to
certifications.
(kk) No
Unlawful Contributions or Other Payments. Neither the Company nor any of its
subsidiaries nor, to the Company’s knowledge, any employee or
agent of the Company or any subsidiary, has made any contribution
or other payment to any official of, or candidate for, any federal,
state or foreign office in violation of any law or of the character
required to be disclosed in the Registration Statement, the Time of
Sale Prospectus or the Prospectus.
(ll) Anti-Corruption
and Anti-Bribery Laws. Neither the Company nor any of its
subsidiaries nor any director, officer, or employee of the Company
or any of its subsidiaries, nor to the knowledge of the Company,
any agent, affiliate or other person acting on behalf of the
Company or any of its subsidiaries has, in the course of its
actions for, or on behalf of, the Company or any of its
subsidiaries (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses
relating to political activity; (ii) made or taken any act in
furtherance of an offer, promise, or authorization of any direct or
indirect unlawful payment or benefit to any foreign or domestic
government official or employee, including of any government-owned
or controlled entity or public international organization, or any
political party, party official, or candidate for political office;
(iii) violated or is in violation of any provision of the U.S.
Foreign Corrupt Practices Act of 1977, as amended (the
“FCPA”), the UK
Xxxxxxx Xxx 0000, or any other applicable anti-bribery or
anti-corruption law; or (iv) made, offered, authorized,
requested, or taken an act in furtherance of any unlawful bribe,
rebate, payoff, influence payment, kickback or other unlawful
payment or benefit . The Company and its subsidiaries and, to the
knowledge of the Company, the Company’s affiliates have
conducted their respective businesses in material 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.
(mm) Money
Laundering Laws. The
operations of the Company and its subsidiaries are, and have been
conducted at all times, in material 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
applicable rules, regulations or guidelines, issued, administered
or enforced by any governmental agency (collectively, the
“Money Laundering
Laws”) and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Company or any of its subsidiaries with
respect to the Money Laundering Laws is pending or, to the
knowledge of the Company, threatened.
(nn) Sanctions.
Neither the Company nor any of its subsidiaries, directors,
officers, or employees, nor, to the knowledge of the Company, after
due inquiry, any agent, affiliate or other person acting on behalf
of the Company or any of its subsidiaries is currently the subject
or the target of any U.S. sanctions administered by the Office of
Foreign Assets Control of the U.S. Department of the Treasury
(“OFAC”) or the
U.S. Department of State, the United Nations Security Council, the
European Union, Her Majesty’s Treasury of the United Kingdom,
or other relevant sanctions authority (collectively,
“Sanctions”);
nor is the Company or any of its subsidiaries located, organized or
resident in a country or territory that is the subject or the
target of Sanctions, including, without limitation, Crimea, Cuba,
Iran, North Korea, and Syria; and the Company will not directly or
indirectly use the proceeds of this offering, or lend, contribute
or otherwise make available such proceeds to any subsidiary, or any
joint venture partner or other person or entity, for the purpose of
financing the activities of or business with any person, or in any
country or territory, that at the time of such financing, is the
subject or the target 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 applicable Sanctions. For the past five
years, the Company and its subsidiaries have not knowingly engaged
in and are not now knowingly engaged in any dealings or
transactions with any person that at the time of the dealing or
transaction is or was the subject or the target of Sanctions or
with any Sanctioned Country.
-11-
(oo) Brokers.
Except pursuant to this Agreement, there is no broker, finder or
other party that is entitled to receive from the Company any
brokerage or finder’s fee or other fee or commission as a
result of any transactions contemplated by this
Agreement.
(pp) Forward-Looking
Statements. Each financial or operational projection or
other “forward-looking statement” (as defined by
Section 27A of the Securities Act or Section 21E of the Exchange
Act) contained in the Registration Statement, the Time of Sale
Prospectus or the Prospectus (i) was so included by the
Company in good faith and with reasonable basis after due
consideration by the Company of the underlying assumptions,
estimates and other applicable facts and circumstances and
(ii) is accompanied by meaningful cautionary statements
identifying those factors that could cause actual results to differ
materially from those in such forward-looking statement. No such
statement was made with the knowledge of an executive officer or
director of the Company that it was false or
misleading.
(qq) No Outstanding Loans or
Other Extensions of Credit. The Company does not have any
outstanding extension of credit, in the form of a personal loan, to
or for any director or executive officer (or equivalent thereof) of
the Company except for such extensions of credit as are expressly
permitted by Section 13(k) of the Exchange Act.
(rr) Cybersecurity.
Except as would not reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Change; (i) the Company
and its subsidiaries’ information technology assets and
equipment, computers, systems, networks, hardware, software,
websites, applications, and databases (collectively,
“IT Systems”)
are adequate for, and operate and perform in all material respects
as required in connection with the operation of the business of the
Company and its subsidiaries as currently conducted, and to the
Company’s knowledge, are free and clear of all material bugs,
errors, defects, Trojan horses, time bombs, malware and other
corruptants; (ii) the Company and its subsidiaries have implemented
and maintained commercially reasonable physical, technical and
administrative controls, policies, procedures, and safeguards to
maintain and protect their material confidential information and
the integrity, continuous operation, redundancy and security of all
IT Systems and data, all personal, personally identifiable,
sensitive, confidential or regulated data (“Personal Data”) used in connection
with their businesses. To the Company’s knowledge, there have
been no material breaches, violations, outages or unauthorized uses
of or accesses to same, except for those that have been remedied
without material cost or liability or the duty to notify any other
person, nor any incidents under internal review or investigations
relating to the same. The Company and its subsidiaries are
presently in compliance with all applicable laws or statutes and
all applicable judgments, orders, rules and regulations of any
court or arbitrator or governmental or regulatory authority,
internal policies and contractual obligations relating to the
privacy and security of IT Systems and Personal Data and to the
protection of such IT Systems and Personal Data from unauthorized
use, access, misappropriation or modification, except as would not
reasonably be expected, individually or in the aggregate, to result
in a Material Adverse Change.
(ss) Compliance
with Data Privacy Laws. Except
as would not reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Change, the Company and
its subsidiaries are, and for the past three (3) years have been,
in compliance with all applicable state and federal data privacy
and security laws and regulations, including, to the extent
applicable, HIPAA (collectively, the “Privacy Laws”). To ensure compliance with the Privacy
Laws, the Company and its subsidiaries have in place, comply with,
and take appropriate steps reasonably designed to ensure
compliance, in all material respects, with their policies and
procedures relating to data privacy and security and the
collection, storage, use, disclosure, handling, and analysis of
Personal Data (the “Policies”). Except as would not reasonably be
expected, individually or in the aggregate, to result in a Material
Adverse Change, the Company and its subsidiaries have at all times
made all disclosures to users or customers required by applicable
laws, Privacy Laws and regulatory rules or requirements, and none
of such disclosures made or contained in any Policy have, to the
knowledge of the Company, been inaccurate, misleading, deceptive or
in violation of any applicable laws, Privacy Laws, Policies, and
regulatory rules or requirements in any material respect. Neither
the Company nor any subsidiary: (i) has received written notice of
any actual or potential liability under or relating to, or actual
or potential violation of, any of the Privacy Laws, and has no
knowledge of any event or condition that would reasonably be
expected to result in any such notice; (ii) is currently conducting
or paying for, in whole or in part, any investigation, remediation,
or other corrective action pursuant to any Privacy Law; (iii) is a
party to any order, decree, or agreement that imposes any
obligation or liability by any governmental or regulatory authority
under any Privacy Laws.
-12-
(tt) Communications.
The Company (i) has not alone engaged in communications with
potential investors in reliance on Rule 163B under the Securities
Act other than Permitted Rule 163B Communications with the consent
of the Representatives with entities that are, or are reasonably
believed to be, QIBs or IAIs and (ii) has not authorized anyone
other than the Representatives to engage in such communications;
the Company reconfirms that the Representatives has been authorized
to act on its behalf in undertaking Marketing Materials, Rule 163B
Oral Communications and Rule 163B Written Communications; as of the
Applicable Time, each Permitted Rule 163B Communication, when
considered together with the Time of Sale Prospectus, did not, as
of the Applicable Time, include an untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading; and each Permitted Rule 163B
Communication, if any, does not, as of the date hereof, conflict
with the information contained in the Registration Statement, the
Preliminary Prospectus and the Prospectus.
(uu) Clinical
Data and Regulatory Compliance. The preclinical tests and
clinical trials, and other studies (collectively,
“studies”) that are described in, or the results of
which are referred to in, the Registration Statement, the Time of
Sale Prospectus or the Prospectus were and, if still pending, are
being conducted in all material respects in accordance with
applicable Health Care Laws, each description of the results of
such studies is accurate and complete in all material respects and
fairly presents the data derived from such studies, and the Company
and its subsidiaries have no knowledge of any other studies the
results of which are materially inconsistent with, or otherwise
materially call into question, the results described or referred to
in the Registration Statement, the Time of Sale Prospectuses or the
Prospectus; the Company and its subsidiaries have made all such
filings and obtained all such approvals as may be required by the
Food and Drug Administration of the U.S. Department of Health and
Human Services or any committee thereof or from any other U.S. or
foreign government or drug or medical device regulatory agency, or
health care facility Institutional Review Board (collectively, the
“Regulatory
Agencies”), except for such failure which would not,
individually or in the aggregate, reasonably be expected to result
in a Material Adverse Change; and neither the Company nor any of
its subsidiaries has received any notice of, or correspondence
from, any Regulatory Agency requiring the termination, suspension
or material adverse modification of any clinical trials that are
described or referred to in the Registration Statement, the Time of
Sale Prospectus or the Prospectus, other than any suspension that
was subsequently lifted prior to January 1, 2018.
(vv) Compliance
with Health Care Laws. The Company and its subsidiaries are,
and at all times have been, in compliance with all Health Care
Laws, except for such noncompliance which would not, individually
or in the aggregate, reasonably be expected to result in a Material
Adverse Change. For purposes of this Agreement, “Health Care
Laws” means: (i) the Federal Food, Drug, and Cosmetic Act (21
U.S.C. Section 301 et seq.), the Public Health Service Act (42
U.S.C. Section 201 et seq.), and the regulations promulgated
thereunder; (ii) all applicable federal, state, local and foreign
health care fraud and abuse laws, including, without limitation,
the Anti-Kickback Statute (42 U.S.C. Section 1320a-7b(b)), the
Civil False Claims Act (31 U.S.C. Section 3729 et seq.), the
criminal false statements law (42 U.S.C. Section 1320a-7b(a)), 18
U.S.C. Sections 286 and 287, the health care fraud criminal
provisions under the U.S. Health Insurance Portability and
Accountability Act of 1996 (“HIPAA”) (42 U.S.C. Section
1320d et seq.), the civil monetary
penalties law (42 U.S.C. Section 1320a-7a), the exclusion
law (42 U.S.C. Section 1320a-7), the Physician Payments Sunshine
Act (42 U.S.C. Section 1320-7h), and applicable laws governing
government funded or sponsored healthcare programs; (iii) HIPAA, as
amended by the Health Information Technology for Economic and
Clinical Health Act (42 U.S.C. Section 17921 et seq.); (iv) all
other local, state, federal, national, supranational and foreign
laws, relating to the regulation of the Company or its
subsidiaries, and (v) the directives and regulations promulgated
pursuant to such statutes and any state or non-U.S. counterpart
thereof. Neither the Company nor any of its subsidiaries has
received written notice of any claim, action, suit, proceeding,
hearing, enforcement, investigation, arbitration or other action
from any court or arbitrator or governmental or regulatory
authority or third party alleging that any product operation or
activity is in material violation of any Health Care Laws nor, to
the Company’s knowledge, is any such claim, action, suit,
proceeding, hearing, enforcement, investigation, arbitration or
other action threatened. The Company and its subsidiaries have
filed, maintained or submitted all material reports, documents,
forms, notices, applications, records, claims, submissions and
supplements or amendments as required by any Health Care Laws, and
all such reports, documents, forms, notices, applications, records,
claims, submissions and supplements or amendments were complete and
accurate on the date filed in all material respects (or were
corrected or supplemented by a subsequent submission), except as
would not reasonably be expected to result in a Material Adverse
Change. Neither the Company nor any of its subsidiaries is a party
to any corporate integrity agreements, monitoring agreements,
consent decrees, settlement orders, or similar agreements with or
imposed by any governmental or regulatory authority. Additionally,
neither the Company, any of its subsidiaries nor, to the knowledge
of the Company and its subsidiaries, any of their respective
employees, officers, directors, or agents has been excluded,
suspended or debarred from participation in any U.S. federal health
care program or human clinical research or, to the knowledge of the
Company, is subject to a governmental inquiry, investigation,
proceeding, or other similar action that could reasonably be
expected to result in debarment, suspension, or
exclusion.
-13-
(ww) No
Contract Terminations. Neither the Company nor any of its
subsidiaries has sent or received any communication regarding
termination of, or intent not to renew, any of the contracts or
agreements referred to or described in any preliminary prospectus,
the Prospectus or any free writing prospectus, or referred to or
described in, or filed as an exhibit to, the Registration
Statement, or any document incorporated by reference therein, and
no such termination or non-renewal has been threatened by the
Company or any of its subsidiaries or, to the Company’s
knowledge, any other party to any such contract or agreement, which
threat of termination or non-renewal has not been rescinded as of
the date hereof, in each case except as would not reasonably be
expected to result in a Material Adverse Change.
Any
certificate signed by any officer of the Company or any of its
subsidiaries and delivered to any Underwriter or to counsel for the
Underwriters in connection with the offering, or the purchase and
sale, of the Securities shall be deemed a representation and
warranty by the Company to each Underwriter as to the matters
covered thereby.
The
Company has a reasonable basis for making each of the
representations set forth in this Section 1. The Company
acknowledges that the Underwriters and, for purposes of the
opinions to be delivered pursuant to Section 6 hereof, counsel to the
Company and counsel to the Underwriters, will rely upon the
accuracy and truthfulness of the foregoing representations and
hereby consents to such reliance.
(a) The
Securities. Upon the
terms herein set forth, the Company agrees to issue and sell to the
several Underwriters an aggregate of 63,000,000 shares of Common
Stock and 2,000,000 shares of Preferred Stock On the basis of the
representations, warranties and agreements herein contained, and
upon the terms but subject to the conditions herein set forth, the
Underwriters agree, severally and not jointly, to purchase from the
Company the respective number of Securities set forth opposite
their names on Schedule A. The purchase
price to be paid by the several Underwriters to the Company shall
be (i) $0.8648 per share of Common Stock and (ii) $19.8904 per
share of Preferred Stock.
(b) The
Closing Date.
Delivery of certificates for the Securities to be purchased by the
Underwriters and payment therefor shall be made at the offices of
Xxxxxx LLP (or such other place as may be agreed to by the Company
and the Representatives) at 9:00 a.m. New York City time, on
December 22, 2020, or such other time and date not later than
1:30 p.m. New York City time, on January 5, 2020 as the
Representatives shall designate by notice to the Company (the time
and date of such closing are called the “Closing Date”). The Company hereby
acknowledges that circumstances under which the Representatives may
provide notice to postpone the Closing Date as originally scheduled
include, but are not limited to, any determination by the Company
or the Representatives to recirculate to the public copies of an
amended or supplemented Prospectus or a delay as contemplated by
the provisions of Section 11.
(c) Public
Offering of the Securities. The Representatives hereby advise the
Company that the Underwriters intend to offer for sale to the
public, initially on the terms set forth in the Registration
Statement, the Time of Sale Prospectus and the Prospectus, their
respective portions of the Securities as soon after this Agreement
has been executed as the Representatives, in its sole judgment, has
determined is advisable and practicable.
(d) Payment
for the Securities.
Payment for the Securities shall be made at the Closing Date by
wire transfer of immediately available funds to the order of the
Company.
(i) It is understood
that Jefferies has been authorized, for its own account and the
accounts of the several Underwriters, to accept delivery of and
receipt for, and make payment of the purchase price for, the
Securities the Underwriters have agreed to purchase. Jefferies,
individually and not as a Representative of the Underwriters, may
(but shall not be obligated to) make payment for any Securities to
be purchased by any Underwriter whose funds shall not have been
received by Jefferies by the Closing Date, as the case may be, for
the account of such Underwriter, but any such payment shall not
relieve such Underwriter from any of its obligations under this
Agreement.
-14-
(e) Delivery
of the Securities.
The Company shall deliver, or cause to be delivered to Jefferies
for the accounts of the several Underwriters certificates for the
Securities at the Closing Date, against release of a wire transfer
of immediately available funds for the amount of the purchase price
therefor. If Jefferies so elects, delivery of the Securities may be
made by credit to the accounts designated by Jefferies through The
Depository Trust Company’s full fast transfer or DWAC
programs. If Jefferies so elects, the certificates for the
Securities shall be registered in such names and denominations as
Jefferies shall have requested at least two full business days
prior to the Closing Date and shall be made available for
inspection on the business day preceding the Closing Date at a
location in New York City as Jefferies may designate. Time shall be
of the essence, and delivery at the time and place specified in
this Agreement is a further condition to the obligations of the
Underwriters.
Section 3. Additional
Covenants.
(a) Delivery
of Registration Statement, Time of Sale Prospectus and
Prospectus.
The Company shall furnish to you in New York City, without charge,
prior to 10:00 a.m. New York City time on the business day next
succeeding the date of this Agreement and during the period when a
prospectus relating to the Securities is required by the Securities
Act to be delivered (whether physically or through compliance with
Rule 172 under the Securities Act or any similar rule) in
connection with sales of the Securities, as many copies of the Time
of Sale Prospectus, the Prospectus and any supplements and
amendments thereto or to the Registration Statement as you may
reasonably request.
(b) Representatives’
Review of Proposed Amendments and Supplements. During the period when a
prospectus relating to the Securities is required by the Securities
Act to be delivered (whether physically or through compliance with
Rule 172 under the Securities Act or any similar rule), the Company
(i) will furnish to the Representatives for review, a reasonable
period of time prior to the proposed time of filing of any proposed
amendment or supplement to the Registration Statement, a copy of
each such amendment or supplement and (ii) will not amend or
supplement the Registration Statement (including any amendment or
supplement through incorporation of any report filed under the
Exchange Act) without the Representatives’ prior written
consent, which shall not unreasonably be withheld. Prior to
amending or supplementing any preliminary prospectus, the Time of
Sale Prospectus or the Prospectus (including any amendment or
supplement through incorporation of any report filed under the
Exchange Act), the Company shall furnish to the Representatives for
review, a reasonable amount of time prior to the time of filing or
use of the proposed amendment or supplement, a copy of each such
proposed amendment or supplement. The Company shall not file or use
any such proposed amendment or supplement without the
Representatives’ prior written consent, which shall not
unreasonably be withheld. The Company shall file with the
Commission within the applicable period specified in Rule 424(b)
under the Securities Act any prospectus required to be filed
pursuant to such Rule.
(c) Free
Writing Prospectuses. The Company shall furnish to the
Representatives for review, a reasonable amount of time prior to
the proposed time of filing or use thereof, a copy of each proposed
free writing prospectus or any amendment or supplement thereto
prepared by or on behalf of, used by, or referred to by the
Company, and the Company shall not file, use or refer to any
proposed free writing prospectus or any amendment or supplement
thereto without the Representatives’ prior written consent,
which shall not unreasonably be withheld. The Company shall furnish
to each Underwriter, without charge, as many copies of any free
writing prospectus prepared by or on behalf of, used by or referred
to by the Company as such Underwriter may reasonably request. If at
any time when a prospectus is required by the Securities Act to be
delivered (whether physically or through compliance with Rule 172
under the Securities Act or any similar rule) in connection with
sales of the Securities (but in any event if at any time through
and including the Closing Date) there occurred or occurs an event
or development as a result of which any free writing prospectus
prepared by or on behalf of, used by, or referred to by the Company
conflicted or would conflict with the information contained in the
Registration Statement 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 prevailing at such time, not
misleading, the Company shall promptly amend or supplement such
free writing prospectus to eliminate or correct such conflict so
that the statements in such free writing prospectus as so amended
or supplemented will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
prevailing at such time, not misleading, as the case may be;
provided, however, that
prior to amending or supplementing any such free writing
prospectus, the Company shall furnish to the Representatives for
review, a reasonable amount of time prior to the proposed time of
filing or use thereof, a copy of such proposed amended or
supplemented free writing prospectus, and the Company shall not
file, use or refer to any such amended or supplemented free writing
prospectus without the Representatives’ prior written
consent, which shall not unreasonably be withheld.
-15-
(d) Filing
of Underwriter Free Writing Prospectuses. The Company shall not take any
action that would result in an Underwriter or the Company being
required to file with the Commission pursuant to Rule 433(d) under
the Securities Act a free writing prospectus prepared by or on
behalf of such Underwriter that such Underwriter otherwise would
not have been required to file thereunder.
(e) Amendments
and Supplements to Time of Sale Prospectus. If the Time of Sale Prospectus
is being used to solicit offers to buy the Securities at a time
when the Prospectus is not yet available to prospective purchasers,
and any event shall occur or condition exist as a result of which
it is necessary to amend or supplement the Time of Sale Prospectus
so that the Time of Sale Prospectus does not include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances when delivered to a prospective purchaser, not
misleading, or if any event shall occur or condition exist as a
result of which the Time of Sale Prospectus conflicts with the
information contained in the Registration Statement, or if, in the
opinion of counsel for the Underwriters, it is necessary to amend
or supplement the Time of Sale Prospectus to comply with applicable
law, the Company shall (subject to Section 3(b) and Section 3(c)
hereof) promptly prepare, file with the Commission and furnish, at
its own expense, to the Underwriters and to any dealer upon
request, either amendments or supplements to the Time of Sale
Prospectus so that the statements in the Time of Sale Prospectus as
so amended or supplemented will not include an untrue statement of
a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
when delivered to a prospective purchaser, not misleading or so
that the Time of Sale Prospectus, as amended or supplemented, will
no longer conflict with the information contained in the
Registration Statement, or so that the Time of Sale Prospectus, as
amended or supplemented, will comply with applicable
law.
(f) Certain
Notifications and Required Actions. After the date of this Agreement and
until such time as the Underwriters are no longer required to
deliver a Prospectus in order to confirm sales of the Securities,
the Company shall promptly advise the Representatives in writing
of: (i) the receipt of any comments of, or requests for additional
or supplemental information from, the Commission; (ii) the
time and date of any filing of any post-effective amendment to the
Registration Statement or any amendment or supplement to any
preliminary prospectus, the Time of Sale Prospectus, any free
writing prospectus or the Prospectus; (iii) the time and date that
any post-effective amendment to the Registration Statement becomes
effective; and (iv) the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or
any post-effective amendment thereto or any amendment or supplement
to any preliminary prospectus, the Time of Sale Prospectus or the
Prospectus or of any order preventing or suspending the use of any
preliminary prospectus, the Time of Sale Prospectus, any free
writing prospectus or the Prospectus, or of any proceedings to
remove, suspend or terminate from listing or quotation the Common
Stock from any securities exchange upon which they are listed for
trading or included or designated for quotation, or of the
threatening or initiation of any proceedings for any of such
purposes. If the Commission shall enter any such stop order at any
time, the Company will use its best efforts to obtain the lifting
of such order at the earliest possible moment. Additionally, the
Company agrees that it shall comply with all applicable provisions
of Rule 424(b), Rule 433 and Rule 430B under the Securities
Act and will use its reasonable efforts to confirm that any filings
made by the Company under Rule 424(b) or Rule 433 were received in
a timely manner by the Commission.
(g) Amendments
and Supplements to the Prospectus and Other Securities Act
Matters. If any event shall
occur or condition exist as a result of which it is necessary to
amend or supplement the Prospectus so that the Prospectus does not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances when the Prospectus is delivered
(whether physically or through compliance with Rule 172 under the
Securities Act or any similar rule) to a purchaser, not misleading,
or if in the opinion of the Representatives or counsel for the
Underwriters it is otherwise necessary to amend or supplement the
Prospectus to comply with applicable law, the Company agrees
(subject to Section 3(b) and Section 3(c)) hereof to promptly
prepare, file with the Commission and furnish, at its own expense,
to the Underwriters and to any dealer upon request, amendments or
supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances when the Prospectus is delivered (whether
physically or through compliance with Rule 172 under the Securities
Act or any similar rule) to a purchaser, not misleading or so that
the Prospectus, as amended or supplemented, will comply with
applicable law. Neither the Representatives’ consent to, nor
delivery of, any such amendment or supplement shall constitute a
waiver of any of the Company’s obligations under Section 3(b)
or Section 3(c).
-16-
(h) Blue
Sky Compliance. The
Company shall cooperate with the Representatives and counsel for
the Underwriters to qualify or register the Securities for sale
under (or obtain exemptions from the application of) the state
securities or blue sky laws (or other foreign laws) of those
jurisdictions designated by the Representatives, shall comply with
such laws and shall continue such qualifications, registrations and
exemptions in effect so long as required for the distribution of
the Securities. The Company shall not be required to qualify as a
foreign corporation or to take any action that would subject it to
general service of process in any such jurisdiction where it is not
presently qualified or where it would be subject to taxation as a
foreign corporation. The Company will advise the Representatives
promptly of the suspension of the qualification or registration of
(or any such exemption relating to) the Securities for offering,
sale or trading in any jurisdiction or any initiation or threat of
any proceeding for any such purpose, and in the event of the
issuance of any order suspending such qualification, registration
or exemption, the Company shall use its best efforts to obtain the
withdrawal thereof at the earliest possible moment.
(i) Use
of Proceeds. The
Company shall apply the net proceeds from the sale of the
Securities sold by it in the manner described under the caption
“Use of Proceeds” in the Registration Statement, the
Time of Sale Prospectus and the Prospectus.
(j) Transfer
Agent. The Company
shall maintain, at its expense, a registrar and transfer agent for
the Securities.
(k) Earnings
Statement. The
Company will make generally available to its security holders and
to the Representatives as soon as reasonably practicable an
earnings statement (which need not be audited) covering a period of
at least twelve months beginning with the first fiscal quarter of
the Company commencing after the date of this Agreement that will
satisfy the provisions of Section 11(a) of the Securities Act and
the rules and regulations of the Commission thereunder;
provided, however, that the
requirements of this Section 3(k) shall be satisfied to the extent
that such information is available on XXXXX .
(l) Continued
Compliance with Securities Laws. The Company will comply with the
Securities Act and the Exchange Act so as to permit the completion
of the distribution of the Securities as contemplated by this
Agreement, the Registration
Statement, the Time of Sale Prospectus and the Prospectus. Without
limiting the generality of the foregoing, the Company will, during
the period when a prospectus relating to the Securities is required
by the Securities Act to be delivered (whether physically or
through compliance with Rule 172 under the Securities Act or any
similar rule), file on a timely basis with the Commission and the
Nasdaq all reports and documents required to be filed under the
Exchange Act.
(m) Listing.
The Company will use its best efforts to list, subject to notice of
issuance, the shares of Common Stock, and, subject to receipt of
the Required Stockholder Approval, the shares of Common Stock
issuable upon conversion of the Preferred Stock on the
Nasdaq.
(n) Company
to Provide Copy of the Prospectus in Form That May be Downloaded
from the Internet. If
requested by the Representatives, the Company shall cause to be
prepared and delivered, at its expense, within one business day
from the effective date of this Agreement, to the Representatives
an “electronic
Prospectus” to be used by the Underwriters in
connection with the offering and sale of the Securities. As used
herein, the term “electronic
Prospectus” means a form of Prospectus, and any
amendment or supplement thereto, that meets each of the following
conditions: (i) it shall be encoded in an electronic format,
satisfactory to the Representatives, that may be transmitted
electronically by the Representatives and the other Underwriters to
offerees and purchasers of the Securities; (ii) it shall
disclose the same information as the paper Prospectus, except to
the extent that graphic and image material cannot be disseminated
electronically, in which case such graphic and image material shall
be replaced in the electronic Prospectus with a fair and accurate
narrative description or tabular representation of such material,
as appropriate; and (iii) it shall be in or convertible into a
paper format or an electronic format, satisfactory to Jefferies,
that will allow investors to store and have continuously ready
access to the Prospectus at any future time, without charge to
investors (other than any fee charged for subscription to the
Internet as a whole and for on-line time). The Company hereby
confirms that it has included or will include in the Prospectus
filed pursuant to XXXXX or otherwise with the Commission and in the
Registration Statement at the time it was declared effective an
undertaking that, upon receipt of a request by an investor or his
or her representative, the Company shall transmit or cause to be
transmitted promptly, without charge, a paper copy of the
Prospectus.
-17-
(o) Agreement
Not to Offer or Sell Additional Securities of the
Company. During the
period commencing on and including the date hereof and continuing
through and including the 90th calendar day following the date of
the Prospectus (such period, as extended as described below, being
referred to herein as the “Lock-up Period”), the Company will
not, without the prior written consent of the Representatives
(which consent may be withheld in the Representatives’ sole
discretion), directly or indirectly: (i) sell, offer to sell,
contract to sell or lend any shares of Common Stock or any Related
Securities (as defined below); (ii) effect any short sale, or
establish or increase any “put equivalent position” (as
defined in Rule 16a-1(h) under the Exchange Act) or liquidate or
decrease any “call equivalent position” (as defined in
Rule 16a-1(b) under the Exchange Act) of any shares of Common
Stock or any Related Securities; (iii) pledge, hypothecate or grant
any security interest in any shares of Common Stock or any Related
Securities; (iv) in any other way transfer or dispose of any
shares of Common Stock or any Related Securities; (v) enter
into any swap, hedge or similar arrangement or agreement that
transfers, in whole or in part, the economic risk of ownership of
any shares of Common Stock or any Related Securities, regardless of
whether any such transaction is to be settled in securities, in
cash or otherwise; (vi) announce the offering of any shares of
Common Stock or any Related Securities; (vii) submit or file any
registration statement under the Securities Act in respect of any
shares of Common Stock or Related Securities (other than as
contemplated by this Agreement with respect to the Securities or
except for registration statements on Form S-8 with respect to any
and all shares of Common Stock or Related Securities to be issued
pursuant to any employee benefit plans); (viii) effect a reverse stock split,
recapitalization, share consolidation, reclassification or similar
transaction affecting the outstanding shares of Common
Stock; or (ix)
publicly announce the intention to do any of the foregoing;
provided, however, that the
Company may (A) effect the transactions contemplated hereby; (B)
issue shares of Common Stock, options or warrants or other equity
awards to acquire shares of Common Stock, pursuant to any stock
option, stock bonus or other stock plan or arrangement described in
the Registration Statement, the Time of Sale Prospectus and the
Prospectus as such plans may be amended; (C) issue shares of Common
Stock upon exercise of any such options, warrants or other equity
awards to acquire shares of Common Stock; (D) issue shares of
Common Stock upon exercise of options, warrants or other equity
awards to acquire shares of Common Stock described as outstanding
in the Registration Statement, the Time of Sale Prospectus and
Prospectus; (E) issue shares of Common Stock upon conversion of
shares of the Company’s Series A Convertible Preferred Stock
described as outstanding in the Registration Statement, the Time of
Sale Prospectus and Prospectus; (F) issue shares of Common Stock
upon conversion of shares of the Company’s Series B 10%
Convertible Preferred Stock described as outstanding in the
Registration Statement, the Time of Sale Prospectus and Prospectus
(the “Series B
Preferred”); (G) in connection with any conversion of
shares of the Series B Preferred, issue shares of Common Stock
issuable as payment of any accrued, but unpaid dividends on the
shares of Series B Preferred to be converted; and (H) issue shares
of Common Stock upon conversion of shares of the Company’s
Series C Convertible Preferred Stock described as outstanding in
the Registration Statement, the Time of Sale Prospectus and
Prospectus. For purposes of the foregoing, “Related Securities” shall mean any
options or warrants or other rights to acquire shares of Common
Stock or any securities exchangeable or exercisable for or
convertible into shares of Common Stock, or to acquire other
securities or rights ultimately exchangeable or exercisable for, or
convertible into, shares of Common Stock.
(p) Future Reports to the
Representatives. During the period of three years
hereafter, the Company will furnish to the Representative, c/x
Xxxxxxxxx, at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Global Head of Syndicate: (i) as soon as practicable
after the end of each fiscal year, copies of the Annual Report of
the Company containing the balance sheet of the Company as of the
close of such fiscal year and statements of income,
stockholders’ equity and cash flows for the
year then ended and the opinion thereon of the Company’s
independent public or certified public accountants; (ii) as soon as
practicable after the filing thereof, copies of each proxy
statement, Annual Report on Form 10-K, Quarterly Report on Form
10-Q, Current Report on Form 8-K or other report filed by the
Company with the Commission or any securities exchange; and (iii)
as soon as available, copies of any report or communication of the
Company furnished or made available generally to holders of its
capital stock; provided,
however, that the requirements of this Section 3(p) shall be
satisfied to the extent that such reports, statement,
communications, financial statements or other documents are
available on XXXXX.
(q) Investment
Limitation. The
Company shall not invest or otherwise use the proceeds received by
the Company from its sale of the Securities in such a manner as
would require the Company or any of its subsidiaries to register as
an investment company under the Investment Company
Act.
-18-
(r) No
Stabilization or Manipulation; Compliance with Regulation
M. The Company will
not take, and will ensure that no affiliate of the Company will
take, directly or indirectly, any action designed to or that might
reasonably be expected to cause or result in stabilization or
manipulation of the price of the Common Stock or any reference
security with respect to the Common Stock, whether to facilitate
the sale or resale of the Securities or otherwise, and the Company
will, and shall cause each of its affiliates to, comply with all
applicable provisions of Regulation M.
(s) Enforce
Lock-Up Agreements.
During the Lock-up Period, the Company will enforce all agreements
between the Company and any of its securityholders that restrict or
prohibit, expressly or in operation, the offer, sale or transfer of
Securities or Related Securities or any of the other actions
restricted or prohibited under the terms of the form of Lock-up
Agreement. In addition, the Company will direct the transfer agent
to place stop transfer restrictions upon any such securities of the
Company that are bound by such “lock-up” agreements for
the duration of the periods contemplated in such agreements,
including, without limitation, “lock-up” agreements
entered into by the Company’s officers and directors pursuant
to Section 6(k)
hereof.
(t) Company
to Provide Interim Financial Statements. Prior to the Closing Date, the Company
will furnish the Underwriters, as soon as they have been prepared
by or are available to the Company, a copy of any unaudited interim
financial statements of the Company for any period subsequent to
the period covered by the most recent financial statements
appearing in the Registration Statement and the
Prospectus.
(u) Amendments
and Supplements to Permitted Rule 163B
Communications. If at any time following the
distribution of any Permitted Rule 163B Communication, there
occurred or occurs an event or development as a result of which
such Permitted Rule 163B Communication 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 Representatives and will promptly amend or supplement, at its
own expense, such Permitted Rule 163B Communication to eliminate or
correct such untrue statement or omission.
(v) Announcement
Regarding Lock-ups.
The Company agrees to announce the Underwriters’ intention to
release any director or “officer” (within the meaning
of Rule 16a-1(f) under the Exchange Act) of the Company from any of
the restrictions imposed by any Lock-Up Agreement, by issuing,
through a major news service, a press release in form and substance
satisfactory to Jefferies or, if consented to by Jefferies, in a
registration statement that is publicly filed in connection with a
secondary offering of the Company’s shares promptly following
the Company’s receipt of any notification from the
Representatives in which such intention is indicated, but in any
case not later than the close of the third business day prior to
the date on which such release or waiver is to become effective;
provided, however, that nothing shall prevent Jefferies, on behalf
of the Underwriters, from announcing the same through a major news
service, irrespective of whether the Company has made the required
announcement; and provided,
further, that no such
announcement shall be made of any release or waiver granted solely
to permit a transfer of securities that is not for consideration
and where the transferee has agreed in writing to be bound by the
terms of a Lock-Up Agreement in the form set forth as Exhibit A hereto.
-19-
Section
4. Payment of Expenses. The Company agrees to pay all costs,
fees and expenses incurred in connection with the performance of
its obligations hereunder and in connection with the transactions
contemplated hereby, including without limitation (i) all
expenses incident to the issuance and delivery of the Securities
(including all printing and engraving costs), (ii) all fees
and expenses of the registrar and transfer agent of the Securities,
(iii) all necessary issue, transfer and other stamp taxes in
connection with the issuance and sale of the Securities to the
Underwriters, (iv) all fees and expenses of the
Company’s counsel, independent public or certified public
accountants and other advisors, (v) all costs and expenses
incurred in connection with the preparation, printing, filing,
shipping and distribution of the Registration Statement (including
financial statements, exhibits, schedules, consents and
certificates of experts), the Time of Sale Prospectus, the
Prospectus, each free writing prospectus prepared by or on behalf
of, used by, or referred to by the Company, and each preliminary
prospectus, each Permitted Rule 163B Communication, and all
amendments and supplements thereto, and this Agreement,
(vi) all filing fees, attorneys’ fees and expenses
incurred by the Company or the Underwriters in connection with
qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Securities
for offer and sale under the state securities or blue sky laws,
and, if requested by the Representatives, preparing and printing a
“Blue Sky Survey” or memorandum and a “Canadian
wrapper”, and any supplements thereto, advising the
Underwriters of such qualifications, registrations and exemptions,
(vii) the costs, fees and expenses incurred by the
Underwriters in connection with determining their compliance with
the rules and regulations of FINRA related to the
Underwriters’ participation in the offering and distribution
of the Securities, including any related filing fees and the legal
fees of, and disbursements by, counsel to the Underwriters (such
fees of and disbursements by counsel to the Underwriters pursuant
to clauses (vi) and (vii) not to exceed $15,000 in the
aggregate), (viii) the
costs and expenses of the Company relating to investor
presentations on any “road show”, any Permitted Rule
163B Communication or any Rule 163B Oral Communication undertaken
in connection with the offering of the Securities, including,
without limitation, expenses associated with the preparation or
dissemination of any electronic road show, expenses associated with
the production of road show slides and graphics, fees and expenses
of any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and
lodging expenses of the representatives, employees and officers of
the Company and any such consultants, and one-half the cost of any
aircraft chartered in connection with the road show, (ix) the
fees and expenses associated with listing the shares of Common
Stock on the Nasdaq, and (x) all other fees, costs and
expenses of the nature referred to in Item 14 of Part II of
the Registration Statement. Except as provided in this Section 4 or in Section 7, Section 9 or Section 10 hereof, the Underwriters
shall pay their own expenses, including the fees and disbursements
of their counsel.
Section
5. Covenant of the Underwriters. Each
Underwriter severally and not jointly covenants with the Company
not to take any action that would result in the Company being
required to file with the Commission pursuant to Rule 433(d) under
the Securities Act a free writing prospectus prepared by or on
behalf of such Underwriter that otherwise would not, but for such
actions, be required to be filed by the Company under Rule
433(d).
Section
6. Conditions of the Obligations of the
Underwriters. The
respective obligations of the several Underwriters hereunder to
purchase and pay for the Securities as provided herein on the
Closing Date shall be subject to (x) the accuracy of the
representations and warranties on the part of the Company set forth
in Section 1 hereof as of the
date hereof and as of the Closing Date as though then made (except
in each case for representations and warranties made as of a
specified date, which shall be accurate (in all material respects
or in all respects, as applicable) only as of the specified date),
and (y) to the timely performance, in all material respects, by the
Company of its covenants and other obligations hereunder, and to
each of the following additional conditions:
(a) Comfort
Letter. On the date
hereof, the Representatives shall have received from OUM & Co.
LLP, independent registered public accountants for the Company, a
letter dated the date hereof, addressed to the Underwriters, in
form and substance satisfactory to the Representatives, containing
statements and information of the type ordinarily included in
accountant’s “comfort letters” to underwriters,
delivered according to Statement of Auditing Standards No. 72 (or
any successor bulletin), with respect to the audited and unaudited
financial statements and certain financial information contained in
the Registration Statement, the Time of Sale Prospectus, and each
free writing prospectus, if any.
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(b) Compliance
with Registration Requirements; No Stop Order; No Objection
from FINRA. For the
period from and after the date of this Agreement and through and
including the Closing Date and:
(i) The Company shall
have filed the Prospectus with the Commission (including the
information previously omitted from the Registration Statement
pursuant to Rule 430B under the Securities Act) in the manner and
within the time period required by Rule 424(b) under the Securities
Act.
(ii) No stop order suspending the
effectiveness of the Registration Statement or any post-effective
amendment to the Registration Statement shall be in effect, and no
proceedings for such purpose shall have been instituted or, to the
Company’s knowledge, threatened by the
Commission.
(iii) If
a filing has been made with FINRA, FINRA shall have raised no
objection to the fairness and reasonableness of the underwriting
terms and arrangements.
(c) No
Material Adverse Change or Ratings Agency Change. For the period from and after the date
of this Agreement and through and including the Closing
Date:
(i) in the judgment of
the Representatives there shall not have occurred any Material
Adverse Change; and
(ii) there
shall not have occurred any downgrading, nor shall any notice have
been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any securities of
the Company or any of its subsidiaries by any “nationally
recognized statistical rating organization” as that term is
used in Rule 15c3-1(c)(2)(vi)(F) under the Exchange
Act.
(d) Opinion
of Xxxxxx &
Xxxxxxx. On the
Closing Date, the Representatives shall have received the (i)
opinion and negative assurance letter of Xxxxxx & Xxxxxxx LLP,
counsel for the Company and (ii) tax opinion of Xxxxxx &
Xxxxxxx, LLP, counsel for the Company, each dated as of such date,
in form and substance reasonably satisfactory to the
Representative.
(e) Opinion
of Capital Technology Law Group. On the Closing Date, the
Representatives shall have received the opinion of Capital
Technology Law Group, counsel for the Company with respect to
intellectual property matters, dated as of such date, in form and
substance reasonably satisfactory to the
Representatives.
(f) Opinion
of Xxxxx, Xxxxxx & XxXxxxxx. On the Closing Date, the
Representatives shall have received an opinion of Xxxxx, Xxxxxx
& XxXxxxxx, P.C., counsel for the Company with respect to
regulatory matters, dated as of such date, in form and substance
reasonably satisfactory to the Representatives.
(g) Opinion
of Xxxxxxxx and Wedge. On the Closing Date, the
Representatives shall have received an opinion of Xxxxxxxx and
Wedge, counsel for the Company with respect to the due
authorization and valid issuance of the Securities, dated as of
such date, in form and substance reasonably satisfactory to the
Representatives.
(h) Opinion
of Counsel for the Underwriters. On the Closing Date, the
Representatives shall have received the opinion and negative
assurance letter of Xxxxxx LLP, counsel for the Underwriters in
connection with the offer and sale of the Securities, dated as of
such date, in form and substance satisfactory to the
Underwriters.
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(i) Officers’
Certificate. On the
Closing Date, the Representatives shall have received a certificate
executed by the Chief Executive Officer of the Company and the
Chief Financial Officer of the Company, dated as of such date, to
the effect set forth in Section
6(b)(ii) and further to the effect that:
(i) for the period from
and including the date of this Agreement through and including such
date, there has not occurred any Material Adverse
Change;
(ii) the
representations, warranties and covenants of the Company set forth
in Section 1 of this Agreement are true and correct with the same
force and effect as though expressly made on and as of such date;
and
(iii) the
Company has complied with all the agreements hereunder and
satisfied all the conditions on its part to be performed or
satisfied hereunder at or prior to such date.
(j) Bring-down
Comfort Letter. On
the Closing Date, the Representatives shall have received from OUM
& Co. LLP, independent registered public accountants for the
Company, a letter dated such date, in form and substance
satisfactory to the Representatives, which letter shall: (i)
reaffirm the statements made in the letter furnished by them
pursuant to Section 6(a),
except that the specified date referred to therein for the carrying
out of procedures shall be no more than three business days prior
to the Closing Date, as the case may be; and (ii) cover certain
financial information contained in the Prospectus.
(k) Lock-Up
Agreements. On or prior to the
date hereof, the Company shall have furnished to the
Representatives an agreement in the form of Exhibit
A hereto from each
of the persons listed on Exhibit B hereto, and each such
agreement shall be in full force and effect on the
Closing.
(l) Rule 462(b)
Registration Statement. In the event that a Rule 462(b)
Registration Statement is filed in connection with the offering
contemplated by this Agreement, such Rule 462(b) Registration
Statement shall have been filed with the Commission on the date of
this Agreement and shall have become effective automatically upon
such filing.
(m) Additional
Documents. On or before the Closing Date, the
Representatives and counsel for the Underwriters shall have
received such information, documents and opinions as they may
reasonably request for the purposes of enabling them to pass upon
the issuance and sale of the Securities as contemplated herein, or
in order to evidence the accuracy of any of the representations and
warranties, or the satisfaction of any of the conditions or
agreements, herein contained; and all proceedings taken by the
Company in connection with the issuance and sale of the Securities
as contemplated herein and in connection with the other
transactions contemplated by this Agreement shall be satisfactory
in form and substance to the Representatives and counsel for the
Underwriters.
If any
condition specified in this Section
6 is not satisfied when and as required to be satisfied, this
Agreement may be terminated by the Representatives by notice from
Jefferies to the Company at any time on or prior to the Closing
Date, which termination shall be without liability on the part of
any party to any other party, except that Section 4, Section 7, Section 9 and Section 10 shall at all times be
effective and shall survive such termination.
Section
7. Reimbursement of Underwriters’
Expenses. If this Agreement is terminated by the
Representatives pursuant to Section
6, Section 11 or Section 12, or if the sale to the
Underwriters of the Securities on the Closing Date is not
consummated because of any refusal, inability or failure on the
part of the Company to perform any agreement herein or to comply
with any provision hereof, the Company agrees to reimburse the
Representatives and the other Underwriters (or such Underwriters as
have terminated this Agreement with respect to themselves),
severally, upon demand for all out-of-pocket expenses that shall
have been reasonably incurred and documented by the Representatives
and the Underwriters in connection with the proposed purchase and
the offering and sale of the Securities, including, but not limited
to, reasonable and documented fees and disbursements of counsel,
printing expenses, travel expenses, postage, facsimile and
telephone charges.
Section
8. Effectiveness of this Agreement. This
Agreement shall become effective upon the execution and
delivery hereof by the parties hereto.
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(a) Indemnification of the
Underwriters. The
Company agrees to indemnify and hold harmless each Underwriter, its
affiliates, directors, officers, employees and agents, and each
person, if any, who controls any Underwriter within the meaning of
the Securities Act or the Exchange Act against any loss, claim,
damage, liability or expense, as incurred, to which such
Underwriter or such affiliate, director, officer, employee, agent
or controlling person may become subject, under the Securities Act,
the Exchange Act, other federal or state statutory law or
regulation, or the laws or regulations of foreign jurisdictions
where Securities have been offered or sold or at common law or
otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company),
insofar as such loss, claim, damage, liability or expense (or
actions in respect thereof as contemplated below) arises out of or
is based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration
Statement, or any amendment thereto, or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading;
or (ii) any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus, the Time of
Sale Prospectus, any free writing prospectus that the Company has
used, referred to or filed, or is required to file, pursuant to
Rule 433(d) of the Securities Act, any Marketing Material, any Rule
163B Written Communication or the Prospectus (or any amendment or
supplement to the foregoing), or the omission or alleged omission
to state therein a material fact necessary in order to make the
statements, in the light of the circumstances under which they were
made, not misleading; and to reimburse each Underwriter and each
such affiliate, director, officer, employee, agent and controlling
person for any and all reasonable and documented expenses
(including the reasonable and documented fees and disbursements of
counsel) as such expenses are incurred by such Underwriter or such
affiliate, director, officer, employee, agent or controlling person
in connection with investigating, defending, settling, compromising
or paying any such loss, claim, damage, liability, expense or
action; provided, however,
that the foregoing indemnity agreement shall not apply to any loss,
claim, damage, liability or expense to the extent, but only to the
extent, arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with information relating to any
Underwriter furnished to the Company by the Representatives in
writing expressly for use in the Registration Statement, any
preliminary prospectus, the Time of Sale Prospectus, any such free
writing prospectus, any Marketing Material, any Rule 163B Written
Communication or the Prospectus (or any amendment or supplement
thereto), it being understood and agreed that the only such
information consists of the information described in Section 9(b) below. The indemnity
agreement set forth in this Section
9(a) shall be in addition to any liabilities that the Company
may otherwise have.
(b) Indemnification of the
Company, its Directors and Officers. Each Underwriter
agrees, severally and not jointly, to indemnify and hold harmless
the Company, each of its directors, each of its officers who signed
the Registration Statement and each person, if any, who controls
the Company within the meaning of the Securities Act or the
Exchange Act, against any loss, claim, damage, liability or
expense, as incurred, to which the Company, or any such director,
officer or controlling person may become subject, under the
Securities Act, the Exchange Act, or other federal or state
statutory law or regulation, or at common law or otherwise
(including in settlement of any litigation, if such settlement is
effected with the written consent of such Underwriter), insofar as
such loss, claim, damage, liability or expense (or actions in
respect thereof as contemplated below) arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, or any
amendment thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary
to make the statements therein not misleading or (ii) any untrue
statement or alleged untrue statement of a material fact included
in any preliminary prospectus, the Time of Sale Prospectus, any
free writing prospectus that the Company has used, referred to or
filed, or is required to file, pursuant to Rule 433 of the
Securities Act, any Rule 163B Written Communication or the
Prospectus (or any such amendment or supplement) or the omission or
alleged omission to state therein a material fact necessary in
order to make the statements, in the light of the circumstances
under which they were made, 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 the Registration Statement, such preliminary prospectus, the
Time of Sale Prospectus, such free writing prospectus, such Rule
163B Communication or the Prospectus (or any such amendment or
supplement), in reliance upon and in conformity with information
relating to such Underwriter furnished to the Company by the
Representatives in writing expressly for use therein; and to
reimburse the Company, or any such director, officer or controlling
person for any and all expenses (including the reasonable and
documented fees and disbursements of counsel) as such expenses are
incurred by the Company, or any such director, officer, employee or
controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage,
liability, expense or action. The Company hereby acknowledges that
the only information that the Representatives has furnished to the
Company expressly for use in the Registration Statement, any
preliminary prospectus, the Time of Sale Prospectus, any free
writing prospectus that the Company has filed, or is required to
file, pursuant to Rule 433(d) of the Securities Act, any Rule 163B
Written Communication or the Prospectus (or any amendment or
supplement to the foregoing) are the statements set forth in the
first sentence of the third and fourth paragraphs under the caption
“Underwriting,” the first three sentences of the first
paragraph under the section entitled “Commission and
Expenses,” and the first sentence of the first paragraph
under the section entitled “Stabilization,” each under
the caption “Underwriting” in the Preliminary
Prospectus Supplement and the Final Prospectus Supplement. The
indemnity agreement set forth in this Section 9(b) shall be in addition to
any liabilities that each Underwriter may otherwise
have.
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(c) Notifications and Other
Indemnification Procedures. Promptly after receipt by an
indemnified party under this Section 9 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 this
Section 9, notify the
indemnifying party in writing of the commencement thereof, but the
omission to so notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any
indemnified party to the extent the indemnifying party is not
materially prejudiced as a proximate result of such failure and
shall not in any event relieve the indemnifying party from any
liability that it may have otherwise than on account of this
indemnity agreement. In case any such action is brought against any
indemnified party and such indemnified party seeks or intends to
seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in, and, to the extent that it
shall elect, jointly with all other indemnifying parties similarly
notified, by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified
party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have
reasonably concluded that a conflict may arise between the
positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be
legal defenses available to it and/or other indemnified parties
which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the
right to select separate counsel to assume such legal defenses and
to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of such indemnifying
party’s election to so assume the defense of such action and
approval by the indemnified party of counsel, the indemnifying
party will not be liable to such indemnified party under this
Section 9 for any legal or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (i) the indemnified
party shall have employed separate counsel in accordance with the
proviso to the preceding sentence (it being understood, however,
that the indemnifying party shall not be liable for the fees and
expenses of more than one separate counsel (together with local
counsel), representing the indemnified parties who are parties to
such action), which counsel (together with any local counsel) for
the indemnified parties shall be selected by Jefferies (in the case
of counsel for the indemnified parties referred to in Section 9(a) above) or by the Company (in the
case of counsel for the indemnified parties referred to in Section 9(b) above)) or (ii) the
indemnifying party shall not have employed counsel satisfactory to
the indemnified party to represent the indemnified party within a
reasonable time after notice of commencement of the action or
(iii) the indemnifying party has authorized in writing the
employment of counsel for the indemnified party at the expense of
the indemnifying party, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying
party and shall be paid as they are incurred.
(d) Settlements.
The indemnifying party under this Section 9 shall not be liable for any
settlement of any proceeding effected without its written consent,
but if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or
expense by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by Section
9(c) hereof, the indemnifying party shall be liable for any
settlement of any proceeding 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 and
(ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date
of such settlement. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement,
compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity was
or could have been sought hereunder by such indemnified party,
unless such settlement, compromise or consent includes an
unconditional release of such indemnified party from all liability
on claims that are the subject matter of such action, suit or
proceeding and does not include an admission of fault or
culpability or a failure to act by or on behalf of such indemnified
party.
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Section
10. Contribution. If the indemnification
provided for in Section 9 is
for any reason held to be unavailable to or otherwise insufficient
to hold harmless an indemnified party in respect of any losses,
claims, damages, liabilities or expenses referred to therein, then
each indemnifying party shall contribute to the aggregate amount
paid or payable by such indemnified party, as incurred, as a result
of any losses, claims, damages, liabilities or expenses referred to
therein (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) 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 hand, in connection with the statements
or omissions which resulted in such losses, claims, damages,
liabilities 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 proceeds from the offering of the Securities pursuant
to this Agreement (before deducting expenses) received by the
Company, and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth on the
front cover page of the Prospectus, bear to the aggregate initial
public offering price of the Securities as set forth on such cover.
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, on the one hand, or the Underwriters, on the other hand,
and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.
The
amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall
be deemed to include, subject to the limitations set forth in
Section 9(c), any legal or
other reasonable and documented fees or expenses incurred by such
party in connection with investigating or defending any action or
claim. The provisions set forth in Section 9(c) with respect to notice of
commencement of any action shall apply if a claim for contribution
is to be made under this Section
10; provided, however,
that no additional notice shall be required with respect to any
action for which notice has been given under Section 9(c) for purposes of
indemnification.
The
Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 10 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in this
Section 10.
Notwithstanding the
provisions of this Section 10,
no Underwriter shall be required to contribute any amount in excess
of the underwriting discounts and 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
Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The
Underwriters’ obligations to contribute pursuant to this
Section 10 are several, and not
joint, in proportion to their respective underwriting commitments
as set forth opposite their respective names on Schedule
A. For purposes of this Section 10, each affiliate, director,
officer, employee and agent of an Underwriter and each person, if
any, who controls an Underwriter within the meaning of the
Securities Act or the Exchange Act shall have the same rights to
contribution as such Underwriter, and each director, officer or
employee 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 the Securities Act and the Exchange
Act shall have the same rights to contribution as the
Company.
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Section
11. Default of One or More of the Several
Underwriters. If, on
the Closing Date any one or more of the several Underwriters shall
fail or refuse to purchase Securities that it or they have agreed
to purchase hereunder on such date, and the aggregate number of
Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase does not exceed 10% of the
aggregate number of the Securities to be purchased on such date,
the Representatives may make arrangements satisfactory to the
Company for the purchase of such Securities by other persons,
including any of the Underwriters, but if no such arrangements are
made by such date, the other Underwriters shall be obligated,
severally and not jointly, in the proportions that the number of
Securities set forth opposite their respective names on Schedule A
bears to the aggregate number of Securities set forth opposite the
names of all such non-defaulting Underwriters, or in such other
proportions as may be specified by the Representatives with the
consent of the non-defaulting Underwriters, to purchase the
Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase on such date. If, on the Closing
Date any one or more of the Underwriters shall fail or refuse to
purchase Securities and the aggregate number of Securities with
respect to which such default occurs exceeds 10% of the aggregate
number of Securities to be purchased on such date, and arrangements
satisfactory to the Representatives and the Company for the
purchase of such Securities are not made within 48 hours after such
default, this Agreement shall terminate without liability of any
party to any other party except that the provisions of Section 4, Section 7, Section 9 and Section 10 shall at all times be
effective and shall survive such termination. In any such case
either the Representatives or the Company shall have the right to
postpone the Closing Date, as the case may be, but in no event for
longer than seven days in order that the required changes, if any,
to the Registration Statement and the Prospectus or any other
documents or arrangements may be effected.
As used
in this Agreement, the term “Underwriter” shall be deemed to
include any person substituted for a defaulting Underwriter under
this Section 11. Any action
taken under this Section 11
shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this
Agreement.
Section
12. Termination of this
Agreement. Prior to
the purchase of the Securities by the Underwriters on the Closing
Date, this Agreement may be terminated by Jefferies by notice given
to the Company if at any time: (i) trading or quotation in any
of the Company’s securities shall have been suspended or
limited by the Commission or by the Nasdaq, or trading in
securities generally on either the Nasdaq or the NYSE shall have
been suspended or limited, or minimum or maximum prices shall have
been generally established on any of such stock exchanges;
(ii) a general banking moratorium shall have been declared by
any of federal, New York or California authorities;
(iii) there shall have occurred any outbreak or escalation of
national or international hostilities or any crisis or calamity, or
any substantial change in the United States or international
financial markets, or any substantial change or development
involving a prospective substantial change in United States’
or international political, financial or economic conditions, as in
the judgment of Jefferies is material and adverse and makes it
impracticable to market the Securities in the manner and on the
terms described in the Time of Sale Prospectus or the Prospectus or
to enforce contracts for the sale of securities; (iv) in the
judgment of Jefferies there shall have occurred any Material
Adverse Change; or (v) the Company shall have sustained a loss by
strike, fire, flood, earthquake, accident or other calamity of such
character as in the judgment of Jefferies may interfere materially
with the conduct of the business and operations of the Company
regardless of whether or not such loss shall have been insured. Any
termination pursuant to this Section 12 shall be without liability
on the part of (a) the Company to any Underwriter, except that
the Company shall be obligated to reimburse the expenses of the
Representatives and the Underwriters pursuant to Section 4 or Section 7 hereof or (b) any
Underwriter to the Company; provided, however, that the provisions
of Section 9 and Section 10 shall at all times be
effective and shall survive such termination.
Section 13. 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 contemplated hereby and the process leading to such
transaction, each Underwriter is and has been acting solely as a
principal and is not the agent or fiduciary of the Company, or its
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
contemplated hereby or the process leading thereto (irrespective of
whether such Underwriter has advised or is currently advising the
Company on other matters) and no Underwriter has any obligation to
the Company with respect to the offering contemplated hereby 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 contemplated hereby and the Company has consulted its own
legal, accounting, regulatory and tax advisors to the extent it
deemed appropriate.
-26-
Section
14. Representations and Indemnities to Survive
Delivery. The
respective indemnities, agreements, representations, warranties and
other statements of the Company, of 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
made by or on behalf of any Underwriter or the Company or any of
its or their partners, officers or directors or any controlling
person, as the case may be, and, anything herein to the contrary
notwithstanding, will survive delivery of and payment for the
Securities sold hereunder and any termination of this
Agreement.
Section
15. Notices. All communications hereunder
shall be in writing and shall be mailed, hand delivered or
telecopied and confirmed to the parties hereto as
follows:
|
|
If to the
Representatives:
|
Jefferies
LLC
000
Xxxxxxx Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Facsimile:
(000) 000-0000
Attention:
General Counsel
Xxxxxxx Xxxxx &
Company, L.L.C.
000 Xxxxx Xxxxxxxxx
Xxxxx
Xxxxxxx, Xxxxxxxx
00000
Facsimile: (000)
000-0000
Attention: Equity
Capital Markets and separately, General
Counsel
|
|
|
with a copy to:
If to the
Company:
with a copy
to:
|
Xxxxxx LLP
00 Xxxxxx
Xxxxx
Xxx Xxxx, Xxx Xxxx
00000
Attention: Xxxx
Xxxxxxxxx
Xxxxxx
Xxxxxxx
Xxxxxx X.
Xxxxxxxx
000
Xxxxxxxx Xxxxxx
Xxxxx Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000
Facsimile:
(000)-000-0000
Attention:
Xxxxx Xxxxx, Chief Executive Officer
Xxxxxx & Xxxxxxx
LLP
000 Xxxxx
Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000
Attention: Xxxxxx
Xxxxxxxxxx
Xxxxxxxxxxx
Xxxxxxx
|
Any
party hereto may change the address for receipt of communications
by giving written notice to the others.
Section
16. Successors. This Agreement will inure to the
benefit of and be binding upon the parties hereto, including any
substitute Underwriters pursuant to Section 11 hereof, and to the benefit
of the affiliates, directors, officers, employees, agents and
controlling persons referred to in Section 9 and Section 10, and in each case their
respective successors, and no other person will have any right or
obligation hereunder. The term “successors” shall not include any
purchaser of the Securities as such from any of the Underwriters
merely by reason of such purchase.
Section 17. 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 provision 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.
-27-
Section
18. Recognition
of the U.S. Special Resolution Regimes.
(a) In
the event that any Underwriter that is a Covered Entity becomes
subject to a proceeding under a U.S. Special Resolution Regime, the
transfer from such Underwriter of this Agreement, and any interest
and obligation in or under this Agreement, will be effective to the
same extent as the transfer would be effective under the U.S.
Special Resolution Regime if this Agreement, and any such interest
and obligation, were governed by the laws of the United States or a
state of the United States.
(b) In
the event that any Underwriter that is a Covered Entity or a BHC
Act Affiliate of such Underwriter becomes subject to a proceeding
under a U.S. Special Resolution Regime, Default Rights under this
Agreement that may be exercised against such Underwriter are
permitted to be exercised to no greater extent than such Default
Rights could be exercised under the U.S. Special Resolution Regime
if this Agreement were governed by the laws of the United States or
a state of the United States.
For
purposes of this Agreement, (A) “BHC Act Affiliate” has the meaning
assigned to the term “affiliate” in, and shall be
interpreted in accordance with, 12 U.S.C. § 1841(k); (B)
“Covered Entity”
means any of the following: (i) a “covered entity” as
that term is defined in, and interpreted in accordance with, 12
C.F.R. § 252.82(b); (ii) a “covered bank” as that
term is defined in, and interpreted in accordance with, 12 C.F.R.
§ 47.3(b); or (iii) a “covered FSI” as that term
is defined in, and interpreted in accordance with, 12 C.F.R. §
382.2(b); (C) “Default
Right” has the meaning assigned to that term in, and
shall be interpreted in accordance with, 12 C.F.R. §§
252.81, 47.2 or 382.1, as applicable; and (D) “U.S. Special Resolution Regime”
means each of (i) the Federal Deposit Insurance Act and the
regulations promulgated thereunder and (ii) Title II of the
Xxxx-Xxxxx Xxxx Street Reform and Consumer Protection Act and the
regulations promulgated thereunder.
Section
19. Governing Law Provisions. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of
New York applicable to agreements made and to be performed in such
state. Any legal suit, action or proceeding arising out of or based
upon this Agreement or the transactions contemplated hereby
(“Related
Proceedings”) may be instituted in the federal courts
of the United States of America located in the Borough of Manhattan
in the City of New York or the courts of the State of New York in
each case located in the Borough of Manhattan in the City of New
York (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 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
20. General Provisions. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior
written or oral and all contemporaneous oral agreements,
understandings and negotiations with respect to the subject matter
hereof. This Agreement may be executed in two or more counterparts,
each one of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
This Agreement may not be amended or modified unless in writing by
all of the parties hereto, and no condition herein (express or
implied) may be waived unless waived in writing by each party whom
the condition is meant to benefit. The section headings herein are
for the convenience of the parties only and shall not affect the
construction or interpretation of this Agreement.
Each of
the parties hereto acknowledges that it is a sophisticated business
person who was adequately represented by counsel during
negotiations regarding the provisions hereof, including, without
limitation, the indemnification provisions of Section 9 and the contribution
provisions of Section 10, and
is fully informed regarding said provisions. Each of the parties
hereto further acknowledges that the provisions of Section 9 and Section 10 hereof fairly allocate the
risks in light of the ability of the parties to investigate the
Company, its affairs and its business in order to assure that
adequate disclosure has been made in the Registration Statement,
any preliminary prospectus, the Time of Sale Prospectus, each free
writing prospectus and the Prospectus (and any amendments and
supplements to the foregoing), as contemplated by the Securities
Act and the Exchange Act.
-28-
If the
foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company the enclosed
copies hereof, whereupon this instrument, along with all
counterparts hereof, shall become a binding agreement in accordance
with its terms.
Very
truly yours,
By: /s/ Xxxxx X.
Xxxxx
Name:
Xxxxx X. Xxxxx
Title:
Chief Executive Officer
-29-
The
foregoing Underwriting Agreement is hereby confirmed and accepted
by the Representatives in New York, New York as of the date first
above written.
JEFFERIES LLC
XXXXXXX XXXXX & COMPANY, L.L.C.
Acting individually and as Representatives
of the several Underwriters
named in
the attached Schedule
X.
XXXXXXXXX LLC
By: /s/ Xxxxxxx
Xxx
Name:
Xxxxxxx Xxx
Title:
Managing Director, Joint US Head of Biopharmaceuticals
XXXXXXX XXXXX & COMPANY,
L.L.C.
By: /s/ Xxxxx
Xxxxxxxx
Name:
Xxxxx Xxxxxxxx
Title:
Partner, Head of Equity Capital Markets
-30-
|
Underwriters
|
Number
of Shares of
Common
Stock
to
be Purchased
|
Number
of Shares of
Preferred
Stock
to
be Purchased
|
|
Jefferies
LLC
|
40,950,000
|
1,300,000
|
|
Xxxxxxx Xxxxx &
Company, L.L.C.
|
22,050,000
|
700,000
|
|
Total
|
63,000,000
|
2,000,000
|
-31-
Schedule B
Free Writing Prospectuses Included in the Time of Sale
Prospectus
Term
Sheet for the Preferred Stock, dated December 18,
2020.
-32-
Schedule C
Permitted Rule 163B Communications
[None]
-33-
Schedule D
Subsidiaries of the Company
VistaGen
Therapeutics, Inc. d/b/a VistaStem, a California
corporation
Artemis
Neuroscience, Inc., a Maryland corporation
VistaStem
Canada, Inc., a corporation organized under the laws of Ontario,
Canada
-34-
Form of Lock-up Agreement
___________, 2020
Xxxxxxxxx LLC
As
Representative of the Several Underwriters
c/o Jefferies LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
RE:
VistaGen Therapeutics, Inc. (the
“Company”)
Ladies & Gentlemen:
The undersigned is an owner of shares of common
stock, par value $0.001 per share, of the Company
(“Common Stock”) or of securities convertible into or
exchangeable or exercisable for Common Stock. The Company proposes
to conduct a public offering (the “Offering”) of units consisting of shares of its
Common Stock and shares of its Series D Convertible Preferred Stock
(the “Preferred
Stock” and, together with
the Common Stock, the “Shares”) for which Xxxxxxxxx LLC
(“Jefferies”) will act as the representative of the
underwriters. The undersigned recognizes that the Offering will
benefit each of the Company and
the undersigned. The undersigned acknowledges that the underwriters
are relying on the representations and agreements of the
undersigned contained in this letter agreement in conducting the
Offering and, at a subsequent date, in entering into an
underwriting agreement (the “Underwriting
Agreement”) and other
underwriting arrangements with the Company with respect to the
Offering.
Annex
A sets forth definitions for capitalized terms used in this letter
agreement that are not defined in the body of this agreement. Those
definitions are a part of this agreement.
In
consideration of the foregoing, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned hereby agrees that, during the
Lock-up Period, the undersigned will not (and if the undersigned is
a natural person, will cause any Family Member not to), without the
prior written consent of Jefferies, which may withhold its consent
in its sole discretion:
●
Sell or Offer to
Sell any Shares or Related Securities currently or hereafter owned
either of record or beneficially (as defined in Rule 13d-3 under
the Exchange Act) by the undersigned or such Family
Member,
●
enter into any
Swap,
●
make any demand
for, or exercise any right with respect to, the registration under
the Securities Act of the offer and sale of any Shares or Related
Securities, or cause to be filed a registration statement,
prospectus or prospectus supplement (or an amendment or supplement
thereto) with respect to any such registration, or
●
publicly announce
any intention to do any of the foregoing.
A-1
Notwithstanding
the foregoing, the undersigned may transfer the Shares: (i) as a
bona fide gift or gifts;
(ii) to any trust for the direct or indirect benefit of the
undersigned or a Family Member of the undersigned; (iii) if the
undersigned is a corporation, partnership, limited liability
company, trust or other business entity, (a) to another
corporation, partnership, limited liability company, trust or other
business entity that is a direct or indirect affiliate (as defined
in Rule 405 promulgated under the Securities Act of 1933, as
amended) of the undersigned or (b) in distributions of Shares or
any security convertible into or exercisable for Shares to limited
partners, limited liability company members or stockholders of the
undersigned; (iv) if the undersigned is a trust, to the beneficiary
of such trust; or (v) by testate succession or intestate
succession; provided, in
the case of clauses (i)-(v), that (x) such transfer shall not
involve a disposition for value, (y) any such transferee executes
and delivers to the Representative a lock-up agreement in the form
of this lock-up agreement and (z) no public disclosure nor any
filing by any party under Section 16(a) of the Exchange Act, shall
be required or shall be made voluntarily in connection with such
transfer.
In
addition, the foregoing restrictions shall not apply to the
establishment of any contract, instruction or plan (a
“Plan”) that
satisfies all of the requirements of Rule 10b5-1(c)(1)(i)(B) under
the Exchange Act; provided,
that no sales of the undersigned’s Shares shall be made
pursuant to such a Plan prior to the expiration of the Lock-up
Period, and such a Plan may only be established if no public
announcement of the establishment or existence thereof and no
filing with the SEC or other regulatory authority in respect
thereof or transactions thereunder or contemplated thereby, by the
undersigned, the Company or any other person, shall be required,
and no such announcement or filing is made voluntarily, by the
undersigned, the Company or any other person, prior to the
expiration of the Lock-up Period.
The undersigned also agrees and consents to the entry of stop
transfer instructions with the Company’s transfer agent and
registrar against the transfer of Shares or Related Securities held
by the undersigned and the undersigned’s Family Members, if
any, except in compliance with the foregoing
restrictions.
With respect to the Offering only, the undersigned waives any
registration rights relating to registration under the Securities
Act of the offer and sale of any Shares and/or any Related
Securities owned either of record or beneficially by the
undersigned, including any rights to receive notice of the
Offering.
The undersigned confirms that the undersigned has not, and has no
knowledge that any Family Member has, directly or indirectly, taken
any action designed to or that might 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 of the
Shares. The undersigned will not, and will cause any Family Member
not to take, directly or indirectly, any such action.
The
undersigned acknowledges and agrees that the underwriters have not
provided any recommendation or investment advice nor have the
underwriters solicited any action from the undersigned with respect
to the Offering and the undersigned has consulted their own legal,
accounting, financial, regulatory and tax advisors to the extent
deemed appropriate.
Whether or not the Offering occurs as currently contemplated or at
all depends on market conditions and other factors. The Offering
will only be made pursuant to the Underwriting Agreement, the terms
of which are subject to negotiation between the Company and the
underwriters.
The undersigned hereby represents and warrants that the undersigned
has full power, capacity and authority to enter into this letter
agreement. This letter agreement is irrevocable and will be binding
on the undersigned and the successors, heirs, personal
representatives and assigns of the undersigned.
This letter agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
This Lock-up Agreement shall automatically terminate and be of no
further force and effect if (i) Jefferies advises the Company, or
the Company advises Jefferies, in writing, prior to the execution
of the Underwriting Agreement, that they have determined not to
proceed with the public offering of Shares, (ii) the Company files
an application to withdraw the Registration Statement, (iii) the
Underwriting Agreement is executed but is terminated (other than
the provisions thereof that survive termination) prior to payment
for and delivery of the Shares to be sold thereunder; or (iv)
February 12, 2021 if the offering is not completed by such
date.
[Signature
Page Follows]
A-2
Signature
______________________________________
Printed
Name of Person Signing
(Indicate capacity of person signing if
signing as custodian or trustee, or on behalf
of an entity)
A-3
Certain Defined Terms
Used in Lock-up Agreement
For
purposes of the Lock-up Agreement to which this Annex A is attached
and of which it is made a part:
●
“Call Equivalent
Position” shall have the meaning set forth
in Rule 16a-1(b) under the Exchange Act.
●
“Exchange Act” shall mean the Securities Exchange
Act of 1934, as amended.
●
“Family Member” shall mean the
spouse of the undersigned, an immediate family member of the
undersigned or an immediate family member of the undersigned's
spouse, in each case living in the undersigned's household or whose
principal residence is the undersigned's household (regardless of
whether such spouse or family member may at the time be living
elsewhere due to educational activities, health care treatment,
military service, temporary internship or employment or otherwise).
“Immediate family
member” as used above shall have the meaning set forth
in Rule 16a-1(e) under the Exchange Act.
●
“Lock-up Period” shall mean the
later of (i) 90 days from the date of the final prospectus
supplement or (ii) the earlier of (x) the date on which the
Company’s stockholders approve an increase in the authorized
shares of Common Stock of the Company in an amount sufficient to
permit the conversion of the Preferred Stock and (y) 120 days from
the date of the final prospectus supplement.
●
“Put Equivalent Position” shall
have the meaning set forth in Rule 16a-1(h) under the Exchange
Act.
●
“Related Securities” shall mean any
options or warrants or other rights to acquire Shares or any
securities exchangeable or exercisable for or convertible into
Shares, or to acquire other securities or rights ultimately
exchangeable or exercisable for or convertible into
Shares.
●
“Securities Act” shall mean the
Securities Act of 1933, as amended.
●
“Sell or Offer to Sell” shall mean
to:
–
sell, offer to
sell, contract to sell or lend,
–
effect any short
sale or establish or increase a Put Equivalent Position or
liquidate or decrease any Call Equivalent Position
–
pledge, hypothecate
or grant any security interest in, or
–
in any other way
transfer or dispose of,
in each
case whether effected directly or indirectly.
●
“Swap” shall mean any swap, hedge
or similar arrangement or agreement that transfers, in whole or in
part, the economic risk of ownership of Shares or Related
Securities, regardless of whether any such transaction is to be
settled in securities, in cash or otherwise.
Capitalized terms
not defined in this Annex A shall have the meanings given to them
in the body of this lock-up agreement.
A-4
Exhibit B
Directors and Executive Officers
Signing
Lock-up
Agreement
Directors:
Xxx X.
Xxxxxxxxxx
Xxxxx
X. Xxx
Xxx X.
Xxxx
Xxxxx
X. Xxxxx
H.
Xxxxx Xxxxxxxxx
Xxxxx
X. Xxxxxxxxx
Executive
Officers:
Xxxxxxx
X. Xxxxxx
Xxxx X.
XxXxxxxxxx
Xxxx X.
Xxxxx
Others:
Xxxxx
Xxxxx
B-1
