EX-1.1 2 a15-13693_2ex1d1.htm EX-1.1 Executed Copy IRONWOOD PHARMACEUTICALS, INC. Purchase Agreement June 9, 2015 Credit Suisse Securities (USA) LLC As Representatives of the several Initial Purchasers listed in Schedule 1 hereto c/o J.P. Morgan...
Exhibit 1.1
Executed Copy
IRONWOOD PHARMACEUTICALS, INC.
2.25% Convertible Senior Notes due 2022
June 9, 2015
X.X. Xxxxxx Securities LLC
Credit Suisse Securities (USA) LLC
As Representatives of the
several Initial Purchasers listed
in Schedule 1 hereto
c/o X.X. Xxxxxx Securities LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Credit Suisse Securities (USA) LLC
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Ironwood Pharmaceuticals, Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the several initial purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for whom you are acting as representatives (the “Representatives”), $300,000,000 aggregate principal amount of its 2.25% Convertible Senior Notes due 2022 (the “Underwritten Securities”) and, at the option of the Initial Purchasers, up to an additional $45,000,000 aggregate principal amount of its 2.25% Convertible Senior Notes due 2022 (the “Option Securities”) if and to the extent that the Initial Purchasers shall have determined to exercise the option to purchase such Option Securities pursuant to the terms of Section 2 hereof. The Underwritten Securities and the Option Securities are herein referred to as the “Securities”.
The Securities will be issued pursuant to an Indenture to be dated as of June 15, 2015 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee (the “Trustee”). The Securities will be convertible into shares (the “Underlying Securities”) of Class A common stock of the Company, par value $0.001 per share (the “Class A Common Stock”), cash on the terms set forth in the Indenture based on a formula linked to the price of the Class A Common Stock, or a combination of cash and Underlying Securities, at the Company’s election, as set forth in the Indenture. To the extent there are no additional parties listed on Schedule 1 other than you, the term Representatives as used herein shall mean you as the Initial Purchasers, and the terms Representatives and Initial Purchasers shall mean either the singular or plural as the context requires.
In connection with the offering of the Underwritten Securities, the Company is separately entering into convertible note hedge transactions and warrant transactions with one or more counterparties, who may include affiliates of the Initial Purchasers (each, a “Counterparty”, and together, the “Counterparties”), in each case pursuant to convertible note hedge confirmations and warrant confirmations, respectively, each dated the date hereof (the “Base Confirmations”), and in connection with the issuances of any Option Securities, the Company and one or more Counterparties may enter into additional convertible note hedge transactions and additional warrant transactions pursuant to additional convertible note hedge confirmations and additional warrant confirmations, respectively, each to be dated the date on which the option granted to the Initial
Purchasers pursuant to Section 2 to purchase such Option Securities is exercised (such confirmations the “Additional Confirmations” and together with the Base Confirmations, the “Confirmations”).
The Company hereby confirms its agreement with the several Initial Purchasers concerning the purchase and sale of the Securities, as follows:
As of 5:30 P.M., New York City time, on the date of this Agreement (the “Time of Sale”), the Company had prepared the following information (collectively, the “Time of Sale Information”): the Preliminary Offering Memorandum as supplemented and amended by the written communications listed on Annex A hereto.
2. Purchase and Resale of the Securities by the Initial Purchasers.
(a) The Company agrees to issue and sell the Underwritten Securities to the several Initial Purchasers as provided in this Agreement, and each Initial Purchaser, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Company the respective aggregate principal amount of Underwritten Securities set forth opposite such Initial Purchaser’s name in Schedule 1 hereto at a price equal to 97.25% of the aggregate principal amount thereof (the “Purchase Price”) plus accrued interest, if any, from June 15, 2015 to the Closing Date (as defined below).
In addition, the Company agrees to issue and sell the Option Securities to the several Initial Purchasers as provided in this Agreement, and the Initial Purchasers, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, shall have the option to purchase, severally and not jointly, from the Company the Option Securities at the Purchase Price plus accrued interest, if any, from the Closing Date to the date of payment and delivery.
If any Option Securities are to be purchased, the aggregate principal amount of Option Securities to be purchased by each Initial Purchaser shall be the aggregate principal amount of Option Securities which bears the same ratio to the aggregate principal amount of Option Securities being purchased as the aggregate principal amount of Underwritten Securities set forth opposite the name of such Initial Purchaser in Schedule 1 hereto (or such amount increased as set forth in Section 10 hereof) bears to the aggregate principal amount of Underwritten Securities being purchased from the Company by the several Initial Purchasers, subject, however,
to such adjustments to eliminate Securities in denominations other than $1,000 as the Representatives in their sole discretion shall make.
The Initial Purchasers may exercise the option to purchase the Option Securities at any time in whole, or from time to time in part, solely to cover over-allotments, on or before the thirtieth day following the date of this Agreement, by written notice from the Representatives to the Company. Such notice shall set forth the aggregate amount of Option Securities as to which the option is being exercised and the date and time when the Option Securities are to be delivered and paid for, which may be the same date and time as the Closing Date (as hereinafter defined) but shall not be earlier than the Closing Date or later than the tenth full business day (as hereinafter defined) after the date of such notice (unless such time and date are postponed in accordance with the provisions of Section 10 hereof). Any such notice shall be given at least two business days prior to the date and time of delivery specified therein, except if the Closing Date and Additional Closing Date (as defined herein) are the same, in which case no such notice shall be required.
(b) The Company understands that the Initial Purchasers intend to offer the Securities for resale on the terms set forth in the Time of Sale Information. Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:
(i) it is a qualified institutional buyer (a “QIB”) within the meaning of Rule 144A under the Securities Act (“Rule 144A”) and an accredited investor within the meaning of Rule 501(a) of Regulation D under the Securities Act (“Regulation D”);
(ii) it has not, and none of its affiliates or any other person acting on its behalf has, solicited offers for, or offered or sold, and neither it nor such persons will solicit offers for, or offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act; and
(iii) it has not, and none of its affiliates or any other person acting on its behalf has, solicited offers for, or offered or sold, and neither it nor such persons will solicit offers for, or offer or sell, the Securities as part of its initial offering thereof except to persons whom it reasonably believes to be QIBs in transactions pursuant to Rule 144A and in connection with each such sale, it has taken reasonable steps or will take reasonable steps to ensure that the purchaser of the Securities is aware that such sale is being made in reliance on Rule 144A.
(c) Each Initial Purchaser acknowledges and agrees that the Company and, for purposes of the opinions to be delivered to the Initial Purchasers pursuant to Sections 6(f), 6(g) and 6(h), counsel for the Company and counsel for the Initial Purchasers, as applicable, may rely upon the accuracy of the representations and warranties of the Initial Purchasers, and compliance by the Initial Purchasers with their agreements, contained in paragraph (b) above, and each Initial Purchaser hereby consents to such reliance.
(d) The Company acknowledges and agrees that the Initial Purchasers may offer and sell Securities to or through any affiliate of an Initial Purchaser and that any such affiliate may offer and sell Securities purchased by it to or through any Initial Purchaser; provided, however, that notwithstanding the forgoing, each Initial Purchasers shall remain responsible in all respects for the fulfillment of its obligation under this Agreement, and for the actions of any affiliates acting on behalf of such Initial Purchaser.
(e) Payment for the Securities shall be made by wire transfer in immediately available funds to the account specified by the Company to the Representatives in the case of the Underwritten Securities, at the offices of Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York City time, on June 15, 2015, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representatives and the Company may agree upon in writing or, in the case of the Option Securities, on the date and at the time and place specified by the Representatives
in the written notice of the Initial Purchasers’ election to purchase such Option Securities. The time and date of such payment for the Underwritten Securities is referred to herein as the “Closing Date”, and the time and date for such payment for the Option Securities, if other than the Closing Date, is herein referred to as the “Additional Closing Date”.
Payment for the Securities to be purchased on the Closing Date or the Additional Closing Date, as the case may be, shall be made against delivery to the nominee of the Depositary Trust Company (“DTC”), for the respective accounts of the several Initial Purchasers of the Securities to be purchased on such date of one or more global notes representing the Securities (collectively, the “Global Securities”), with any transfer taxes payable in connection with the sale of such Securities duly paid by the Company.
(f) The Company acknowledges and agrees that the Initial Purchasers are acting solely in the capacity of an arm’s length contractual counterparty to the Company with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person. Additionally, neither the Representatives nor any other Initial Purchaser is advising the Company or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and the Initial Purchasers shall have no responsibility or liability to the Company with respect thereto. Any review by the Initial Purchasers of the Company, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Initial Purchasers and shall not be on behalf of the Company.
communication referred to in clauses (i), (ii) or (iii) below), an “Issuer Written Communication”) other than (i) the documents listed on Annex A hereto, including a term sheet substantially in the form of Annex B hereto, which constitute part of the Time of Sale Information, and (ii) each electronic road show and any other written communications approved in writing in advance by the Representatives. Each such Issuer Written Communication, when taken together with the Time of Sale Information, did not, and as of the Closing Date and as of the Additional Closing Date, as the case may be, 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; provided that the Company makes no representation and warranty with respect to any statements or omissions made in each such Issuer Written Communication in reliance upon and in conformity with information furnished to the Company in writing by an Initial Purchaser through the Representatives expressly for use in such Issuer Written Communication, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b) hereof.
unit awards described as outstanding in, and the grant of options and awards under existing equity incentive plans described in or incorporated by reference in, the Time of Sale Information and the Offering Memorandum) or long-term debt of the Company or any of its subsidiaries, or any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital stock, or any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, properties, management, financial position, stockholders’ equity or results of operations of the Company and its subsidiaries taken as a whole; (ii) neither the Company nor any of its subsidiaries has entered into any transaction or agreement (whether or not in the ordinary course of business) that is material to the Company and its subsidiaries taken as a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiaries taken as a whole; and (iii) neither the Company nor any of its subsidiaries has sustained any loss or interference with its business that is material to the Company and its subsidiaries taken as a whole and that is either from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in the Time of Sale Information and the Offering Memorandum.
(j) [Reserved].
(m) Purchase Agreement. This Agreement has been duly authorized, executed and delivered by the Company.
(n) The Securities. The Securities to be issued and sold by the Company hereunder have been duly authorized and, when duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be duly and validly issued and will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.
(q) Descriptions of the Transaction Documents. Each Transaction Document conforms in all material respects to the description thereof contained in the Time of Sale Information and the Offering Memorandum.
occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject; or (iii) in violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, have a Material Adverse Effect.
(aa) Taxes. The Company and its subsidiaries have paid all federal, state, local and foreign taxes and filed all tax returns required to be paid or filed through the date hereof, except those being contested in good faith and for which reserves in accordance with GAAP have been provided and except as would not reasonably be expected to have a Material Adverse Effect; and except as otherwise disclosed in the Time of Sale Information and the Offering Memorandum or as would not reasonably be expected to have a Material Adverse Effect, there is no tax deficiency that has been, or would reasonably be expected to be, asserted against the Company or any of its subsidiaries or any of their respective properties or assets.
the Time of Sale Information and the Offering Memorandum, as applicable, the Company and its subsidiaries (i) are and at all times have been in compliance with all applicable statutes, rules and regulations applicable to the ownership, testing, development, manufacture, packaging, processing, use, distribution, storage, import, export or disposal of any product manufactured or distributed by the Company (“Applicable Laws”), except for such non-compliance as would not, individually or in the aggregate, have a Material Adverse Effect; and (ii) have not received any U.S. Food and Drug Administration (“FDA”) Form 483, written notice of adverse finding, warning letter, untitled letter or other correspondence or written notice from any court or arbitrator or governmental or regulatory authority or third party alleging or asserting non-compliance with any Applicable Laws or any licenses, exemptions, certificates, approvals, clearances, authorizations, permits and supplements or amendments thereto required by any such Applicable Laws, except for such non-compliance as would not, individually or in the aggregate, have a Material Adverse Effect.
limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; (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 the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) interactive data in eXtensible Business Reporting Language incorporated by reference in the Time of Sale Information and the Offering Memorandum fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Except as disclosed in the Time of Sale Information and the Offering Memorandum, there are no material weaknesses or significant deficiencies in the Company’s internal controls.
(hh) eXtensible Business Reporting Language. The interactive data in eXtensible Business Reporting Language incorporated by reference in the Time of Sale Information and the Offering Memorandum 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.
person”), the United Nations Security Council (“UNSC”), the European Union, Her Majesty’s Treasury (“HMT”), or, to the knowledge of the Company, other relevant sanctions authority (collectively, “Sanctions”); and the Company will not, directly or indirectly, use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any Sanctions.
(qq) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b) of Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act.
(tt) No Stabilization. The Company has not taken, directly or indirectly, any action designed to or that would reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.
(vv) Forward-Looking Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) included in the Time of Sale Information and the Offering Memorandum has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(xx) Xxxxxxxx-Xxxxx Act. There is and has been no failure on the part of the Company or, to the knowledge of the Company, any of the Company’s directors or officers, in their capacities as such, to comply with any applicable provision of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated in connection therewith (the “Xxxxxxxx-Xxxxx Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications.
4. Further Agreements of the Company. The Company covenants and agrees with each Initial Purchaser that:
(a) Delivery of Copies. At any time prior to the completion of the initial offering of the Securities, the Company will deliver to the Initial Purchasers as many copies of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including all amendments and supplements thereto) as the Representative may reasonably request.
(b) Offering Memorandum, Amendments or Supplements. Before finalizing the Offering Memorandum or making or distributing any amendment or supplement to any of the Time of Sale Information or the Offering Memorandum or filing any document with the Commission that will be incorporated by reference therein, at any time prior to the completion of the initial offering of the Securities, the Company will furnish to the Representatives and counsel for the Initial Purchasers a copy of the proposed Offering Memorandum or such amendment or supplement or such document to be incorporated by reference therein for review, and will not distribute any such proposed Offering Memorandum, amendment or supplement without providing the Representatives a reasonable opportunity to review and comment, provided that the foregoing shall not restrict the Company from filing periodic reports under the Exchange Act.
(c) Additional Written Communications. Before using, authorizing, approving or referring to any Issuer Written Communication, at any time prior to the completion of the initial offering of the Securities, the Company will furnish to the Representatives and counsel for the Initial Purchasers a copy of such written communication for review and will use, authorize, approve or refer to any such written communication to which either of the Representatives reasonably objects, provided that the foregoing shall not restrict the Company from filing periodic reports under the Exchange Act.
(d) Notice to the Representatives. At any time prior to the completion of the initial offering of the Securities, the Company will advise the Representatives promptly, and confirm such advice in writing, (i) of the issuance by any governmental or regulatory authority of any order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum in connection with the initial offering of the Securities or the initiation or
threatening of any proceeding for that purpose; (ii) of the occurrence of any event as a result of which any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum as then amended or supplemented would include 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 existing as of the date of such Time of Sale Information, Issuer Written Communication or the Offering Memorandum, not misleading; and (iii) of the receipt by the Company of any notice with respect to any suspension of the qualification of the Securities for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Company will use its best efforts to prevent the issuance of any such order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum or suspending any such qualification of the Securities and, if any such order is issued, will obtain as soon as possible the withdrawal thereof.
(e) Ongoing Compliance of the Offering Memorandum and Time of Sale Information. (1) If at any time prior to the completion of the initial offering of the Securities (i) any event shall occur or condition shall exist as a result of which the Offering Memorandum as then amended or supplemented would include 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 existing when the Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Offering Memorandum to comply with law, the Company will immediately notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments or supplements to the Offering Memorandum as may be necessary so that the statements in the Offering Memorandum as so amended or supplemented will not, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, be misleading or so that the Offering Memorandum will comply with applicable law and (2) if at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which the Time of Sale Information as then amended or supplemented would include 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 existing when the Time of Sale Information is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with law, the Company will immediately notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments or supplements to the Time of Sale Information as may be necessary so that the statements in the Time of Sale Information as so amended or supplemented will not, in the light of the circumstances existing when the Time of Sale Information is delivered to a purchaser, be misleading.
(f) Blue Sky Compliance. The Company will qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request and will continue such qualifications in effect so long as required for the offering and initial resale of the Securities; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
(g) Clear Market. For a period of 60 days after the date hereof (the “Restricted Period”), the Company will not (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, or file with the Commission a registration statement under the Securities Act relating to, any shares of Class A Common Stock or any securities convertible into or exercisable or exchangeable for Class A Common Stock or shares of the Company’s Class B common stock, par value $0.001 per share (the “Class B Common Stock”), or publicly disclose the intention to make any offer, sale, pledge, disposition or filing, or (ii) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the
Class A Common Stock or any such other securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Class A Common Stock or such other securities convertible into or exercisable or exchangeable for Class A Common Stock, in cash or otherwise, without the prior written consent of the Representatives, other than (A) the Securities to be sold hereunder; (B) in connection with any hedging transaction entered into in connection with the Securities to be sold hereunder during the Restricted Period, including, without limitation, the issuance of any Warrant Securities to purchase Class A Common Stock in connection with such hedging transactions, or the issuance of the Warrant Shares issuable upon the exercise of such Warrant Securities; (C) any shares of Class A Common Stock or Class B Common Stock issued upon the exercise or vesting of any award granted under the stock-based compensation plans of the Company and its subsidiaries (the “Company Stock Plans”); (D) shares of stock or restricted stock (Class A Common Stock or Class B Common Stock) and options or awards to purchase shares of Class A Common Stock or Class B Common Stock issued under the Company Stock Plans or other stock purchase plans described in the Offering Memorandum, provided that, the party to whom any shares of Class A Common Stock or Class B Common Stock, restricted stock or options that vest during the Restricted Period are to be issued shall sign and deliver a “lock-up” agreement substantially in the form of Exhibit A hereto, provided that no “lock-up” or similar agreement will be required to be executed in connection with issuances of Class A Common Stock under the Company’s director compensation plan to any former director of the Company in connection with such former director’s board service prior to the date hereof; (E) shares of Class A Common Stock issued or to be issued in connection with any business combination, acquisition, in-license or strategic investment, provided that either (y) shares of Class A Common Stock will not be issued in a transaction prior to the expiration of the Restricted Period or (z) each individual or entity to whom any such shares of Class A Common Stock are issued signs and delivers a “lock-up” agreement substantially in the form of Exhibit A hereto; (F) the issuance by the Company of the Underlying Securities upon conversion of the Securities; (G) in connection with the issuance of the Warrant Securities; and (H) the registration under the Securities Act of securities referenced in clauses (C), (D), or (E).
(h) Use of Proceeds. The Company will apply the net proceeds from the sale of the Securities as described in the Time of Sale Information and the Offering Memorandum under the heading “Use of Proceeds”.
(i) No Stabilization. The Company will not take, directly or indirectly, any action designed to or that would reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities and will not take any action prohibited by Regulation M under the Exchange Act in connection with the distribution of the Securities contemplated hereby.
(j) Underlying Securities. The Company will reserve and keep available at all times, free of pre-emptive rights, the maximum number of shares of Class A Common Stock initially issuable for the purpose of enabling the Company to satisfy all obligations to issue the Underlying Securities upon conversion of the Securities. The Company will use its reasonable best efforts to cause the maximum number of the Underlying Securities (assuming the Company elects to issue and deliver solely Underlying Shares in respect of all conversions) to be listed on the Nasdaq Global Select Market.
(k) Warrant Securities. The Company will reserve and keep available at all times, free of preemptive rights, the full number of shares equal to the Warrant Securities. The Company will use its reasonable best efforts to cause the Warrant Securities to be listed on the Nasdaq Global Select Market.
(l) Supplying Information. While the Securities remain outstanding and are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company will, during any period in which the Company is not subject to and in compliance with Section 13 or 15(d) of the Exchange Act, furnish to holders of the Securities, prospective purchasers of the Securities designated
by such holders, in each case upon request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(m) DTC. The Company will provide reasonable assistance to the Initial Purchasers in arranging for the Securities to be eligible for clearance and settlement through DTC on the Closing Date.
(n) No Resales by the Company. During the period from the Closing Date until one year after the Closing Date or the Additional Closing Date, if applicable, the Company will not, and will not permit any of its affiliates (as defined in Rule 144 under the Securities Act) to, resell any of the Securities that have been acquired by any of them, except for Securities purchased by the Company or any of its affiliates and resold in a transaction registered under the Securities Act.
(o) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b) of Regulation D) will, directly or through any agent, sell, offer for sale, solicit offers to buy or otherwise negotiate in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act.
(p) No General Solicitation. None of the Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no covenant is given) will (i) solicit offers for, or offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act.
(f) Opinion and 10b-5 Statement of Counsel for the Company. Ropes & Xxxx LLP, counsel for the Company, shall have furnished to the Representatives, at the request of the Company, their written opinion and 10b-5 statement, dated the Closing Date or the Additional Closing Date, as the case may be, and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representatives.
(g) Opinion and 10b-5 Statement of Counsel for the Initial Purchasers. The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be, an opinion and 10b-5 statement of Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP, counsel for the Initial Purchasers, with respect to such matters as the Representatives may reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.
(k) DTC. The Securities shall be eligible for clearance and settlement through DTC.
(m) Lock-up Agreements. The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and certain shareholders, officers and directors of the Company relating to sales and certain other dispositions of shares of Class A Common Stock or certain other securities, delivered to you on or before the date hereof, shall be full force and effect on the Closing Date or Additional Closing Date, as the case may be.
All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers.
7. Indemnification and Contribution.
thereto) or any omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information furnished to the Company in writing by an Initial Purchaser through the Representatives expressly for use therein, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in subsection (b) below.
9. Termination. This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date or, in the case of the Option Securities, prior to the Additional Closing Date (i) trading generally shall have been suspended or materially limited on or by any of the New York Stock Exchange, the NYSE Amex, the Nasdaq Stock Market, the Chicago Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade; (ii) trading of any securities issued or guaranteed by the Company shall have been suspended on any exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking activities shall have been declared by federal or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis, either within or outside the United States, that, in the judgment of the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the Closing Date or the Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum.
10. Defaulting Initial Purchaser.
(a) If, on the Closing Date or the Additional Closing Date, as the case may be, any Initial Purchaser defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder on such date, the non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such Securities by other persons satisfactory to the Company on the terms contained in this Agreement. If, within 36 hours after any such default by any Initial Purchaser, the non-defaulting Initial Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting Initial Purchasers to purchase such Securities on such terms. If other persons become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the non-defaulting Initial Purchasers or the Company may postpone the Closing Date or the Additional Closing Date, as the case may be, for up to five full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Initial Purchasers may be necessary in the Time of Sale Information, the Offering Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to the Time of Sale Information and the Offering Memorandum that effects any such changes. As used in this Agreement, the term “Initial Purchaser” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Securities that a defaulting Initial Purchaser agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate principal amount of Securities that remain unpurchased on the Closing Date or the Additional Closing Date, as the case may be, does not exceed one-eleventh of the aggregate number of Securities to be purchased on such date, then the Company shall have the right to require each non-defaulting Initial Purchaser to purchase the number of Securities that such Initial Purchaser agreed to purchase hereunder on such date plus such Initial Purchaser’s pro rata share (based on the number of Securities that such Initial Purchaser agreed to purchase on such date) of the Securities of such defaulting Initial Purchaser or Initial Purchasers for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in
paragraph (a) above, the aggregate number of Securities that remain unpurchased on the Closing Date or the Additional Closing Date, as the case may be, exceeds one-eleventh of the aggregate principal amount of Securities to be purchased on such date, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement or, with respect to any Additional Closing Date, the obligation of the Initial Purchasers to purchase Securities on the Additional Closing Date shall terminate without liability on the part of the non-defaulting Initial Purchasers. Any termination of this Agreement pursuant to this Section 10 shall be without liability on the part of the Company, except that the Company and the Initial Purchasers will continue to be liable for the payment of expenses as set forth in Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it may have to the Company or any non-defaulting Initial Purchaser for damages caused by its default.
(a) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Company will pay or cause to be paid all costs and expenses incident to the performance of its obligations hereunder, including without limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any Warrant Securities and any taxes payable in that connection; (ii) the costs incident to the preparation and printing of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication, and the Offering Memorandum (including any amendments and supplements thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the fees and expenses of the Company’s counsel and independent accountants; (v) the fees and expenses incurred in connection with the registration or qualification under the state or foreign securities or blue sky laws of such jurisdictions as the Representatives may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including up to $10,000 of the related reasonable and documented fees and expenses of counsel for the Initial Purchasers); (vi) fees and expenses of the Trustee and any paying agent (including related reasonable and documented fees and expenses of any counsel to such parties); (vii) all travel and lodging expenses incurred by the Company in connection with any “road show” presentation to potential investors, other than those described in subsection (b) below; and (viii) all expenses and application fees related to the listing of the Underlying Securities and the Warrant Securities on the Nasdaq Global Select Market.
(b) Except as provided in this Section 11 and in Section 7, the Initial Purchasers will pay all of their own costs and expenses, including (i) the fees of their counsel; (ii) stock transfer taxes on resale of any of the Securities by them; (iii) the travel and lodging expenses of the representatives of the Initial Purchasers; and (iv) any advertising expenses connected with any offers they may make.
(c) If (i) this Agreement is terminated pursuant to Section 9, (ii) the Company for any reason fails to tender the Securities for delivery to the Initial Purchasers pursuant to the terms of this Agreement or (iii) the Initial Purchasers decline to purchase the Securities for any reason permitted under this Agreement, the Company agrees to reimburse the Initial Purchasers for all out-of-pocket costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Initial Purchasers in connection with this Agreement and the offering contemplated hereby.
purchaser of Securities from any Initial Purchaser shall be deemed to be a successor merely by reason of such purchase.
14. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or required to be closed in New York City; and (c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act.
(c) Governing Law. This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed in such state.
If the foregoing is in accordance with your understanding, please indicate your acceptance of this Agreement by signing in the space provided below.
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Very truly yours, | ||
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IRONWOOD PHARMACEUTICALS, INC. | ||
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By: |
/s/ Xxxxxx Xxxxxx | |
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Name: |
Xxxxxx Xxxxxx | |
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Title: |
Chief Financial Officer & Senior Vice President of Finance and Corporate Strategy | |
[Signature Page to Purchase Agreement]
Accepted: June 9, 2015 |
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X.X. XXXXXX SECURITIES LLC |
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CREDIT SUISSE SECURITIES (USA) LLC |
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For themselves and on behalf of the |
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several Initial Purchasers listed |
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in Schedule 1 hereto. |
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X.X. XXXXXX SECURITIES LLC |
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By: |
/s/ Xxxxxx Xxxx |
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Name: |
Xxxxxx Xxxx |
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Title: |
Managing Director |
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CREDIT SUISSE SECURITIES (USA) LLC |
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By: |
/s/ Xxxxx Xxxxxxxx |
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Name: |
Xxxxx Xxxxxxxx |
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Title: |
Managing Director |
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[Signature Page to Purchase Agreement]
Schedule 1
Initial Purchaser |
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Principal Amount |
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X.X. Xxxxxx Securities LLC |
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$150,000,000 |
Credit Suisse Securities (USA) LLC |
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$112,500,000 |
Xxxxxx Xxxxxxx & Co. LLC |
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$ 22,500,000 |
Xxxxxxx, Sachs & Co. |
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$ 15,000,000 |
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Total |
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$300,000,000 |
Schedule 1
Annex A
Time of Sale Information
Term sheet containing the terms of the Securities, substantially in the form of Annex B.
Annex B
PRICING TERM SHEET
Dated June 9, 2015
Ironwood Pharmaceuticals, Inc.
2.25% Convertible Senior Notes due 2022
The information in this pricing term sheet supplements Ironwood Pharmaceuticals, Inc.’s preliminary offering memorandum, dated June 8, 2015 (the “Preliminary Offering Memorandum”), and supersedes the information in the Preliminary Offering Memorandum to the extent inconsistent with the information in the Preliminary Offering Memorandum. In all other respects, this term sheet is qualified in its entirety by reference to the Preliminary Offering Memorandum. Terms used herein but not defined herein shall have the respective meanings set forth in the Preliminary Offering Memorandum. All references to dollar amounts are references to U.S. dollars. References herein to “common stock” refer to Ironwood Class A common stock.
Issuer: |
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Ironwood Pharmaceuticals, Inc., a Delaware corporation (“Ironwood”). |
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Ticker / Exchange: |
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IRWD / The NASDAQ Global Select Market (“NASDAQ”). |
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Title of Securities: |
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2.25% Convertible Senior Notes due 2022 (the “Notes”). |
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Aggregate Principal Amount of Notes Offered: |
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$300,000,000. |
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Offering Price: |
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The Notes will be issued at a price of 100% of their aggregate principal amount, plus accrued interest, if any, from June 15, 2015. |
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Initial Purchasers’ Over-Allotment Option: |
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$45,000,000 aggregate principal amount of Notes. |
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Interest Rate: |
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The Notes will bear interest at a rate equal to 2.25% per annum from June 15, 2015. |
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Interest Payment Dates: |
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June 15 and December 15 of each year, beginning on December 15, 2015. |
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Maturity Date: |
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June 15, 2022, unless earlier repurchased or converted. |
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NASDAQ Last Reported Sale Price of Ironwood Class A Common Stock on June 9, 2015: |
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$12.28 per share. |
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Conversion Premium: |
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Approximately 35.0% above the NASDAQ last reported sale price of Ironwood Class A common stock on June 9, 2015. |
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Initial Conversion Price: |
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Approximately $16.58 per share of Ironwood Class A common stock. |
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Initial Conversion Rate: |
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60.3209 shares of Ironwood Class A common stock per $1,000 principal amount of Notes. |
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Settlement: |
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Conversions will be settled in cash, shares of Ironwood Class A common stock or a combination of cash and shares of Ironwood Class A common stock, at Ironwood’s election. |
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Trade Date: |
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June 10, 2015. |
Settlement Date: |
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June 15, 2015. |
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Joint Book-Running Managers: |
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X.X. Xxxxxx Securities LLC Credit Suisse Securities (USA) LLC Xxxxxx Xxxxxxx & Co. LLC |
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Lead Manager: |
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Xxxxxxx, Sachs & Co. |
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CUSIP Number: |
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46333X AC2. |
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ISIN: |
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US46333XAC20. |
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Convertible Note Hedge and Warrant Transactions: |
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Upon pricing the Notes, Ironwood expects to enter into convertible note hedge transactions with certain financial institutions, which may include one or more of the initial purchasers or their respective affiliates (the “option counterparties”). Ironwood also expects to simultaneously enter into warrant transactions with the option counterparties pursuant to which Ironwood will sell warrants to purchase Ironwood Class A common stock. The convertible note hedge transactions are expected generally to reduce the potential dilution to Ironwood Class A common stock upon any conversion of Notes and/or offset any cash payments Ironwood is required to make upon conversion of the Notes in excess of the principal amount of converted Notes, as the case may be. Separately, the warrant transactions will have a dilutive effect to the extent that the market price per share of Ironwood Class A common stock exceeds the strike price of the warrants. If the initial purchasers exercise their over-allotment option, Ironwood may enter into additional convertible note hedge and warrant transactions. See “Description of cash convertible note hedge and warrant transactions” in the Preliminary Offering Memorandum. |
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Use of Proceeds: |
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Ironwood intends to use approximately $18.8 million of the net proceeds from this offering to pay the cost of the convertible note hedge transactions (after such cost is partially offset by the proceeds to Ironwood from the warrant transactions). Ironwood intends to use the remaining net proceeds to strengthen its balance sheet, improve its capital structure and to fund general corporate purposes, which may include the repayment or redemption of all or a portion of its outstanding indebtedness and the acquisition of, or investment in, businesses or other strategic assets. |
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Description of Notes: |
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The Preliminary Offering Memorandum is hereby changed by deleting the section titled “Description of notes—Conversion rights—Exchange in lieu of conversion,” beginning on page 37 (including the heading) and replacing it with the following (as well as making any additional conforming changes consistent with such insertion): |
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“Exchange in lieu of conversion or repurchase |
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When a holder surrenders notes for conversion or for repurchase upon a fundamental change, and the relevant conversion date occurs, or the fundamental change repurchase notice is given, prior to the 65th scheduled trading day immediately preceding June 15, 2022, we may direct the conversion agent or paying agent, as applicable, to surrender, on or prior to the scheduled trading day immediately preceding the first trading day of the applicable observation period (or, if we have elected physical settlement, on or prior to the second business day following the relevant conversion date or on or prior to the fundamental change repurchase date, as applicable), such notes to a financial institution designated by us for exchange in lieu of conversion or repurchase. In order to accept any notes surrendered for conversion or repurchase, the designated institution must agree to pay and/or deliver, as the case may be, in exchange for such notes, the amount of cash, |
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shares of our common stock or a combination thereof otherwise due upon conversion or repurchase, all as provided above in “—Settlement upon conversion” or below in “— Repurchase at option of the holder upon a fundamental change,” as applicable. By the close of business on the scheduled trading day immediately preceding the first trading day of the applicable observation period (or, if we have elected physical settlement, by the close of business on the second business day following the relevant conversion date or on or prior to the fundamental change repurchase date, as applicable), we will notify the holder surrendering notes for conversion or repurchase, the trustee and the conversion or paying agent that we have directed the designated institution to make an exchange in lieu of conversion or repurchase and that the designated financial institution has agreed to make such exchange in lieu of conversion or repurchase. |
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If the designated financial institution accepts any such notes, it will pay and/or deliver, as the case may be, the amount of cash, shares or our common stock or a combination thereof due upon conversion or repurchase of such notes directly to the holder of such notes on the date we would have otherwise been required to deliver such consideration. Notes exchanged by the designated institution will remain outstanding. If the designated financial institution agrees to accept any notes for exchange but does not timely pay and/or deliver the related cash, shares of our common stock or a combination thereof, as the case may be, or if such designated financial institution does not accept the notes for exchange, we will convert the notes and pay and/or deliver, as the case may be, the cash, shares or our common stock or a combination thereof due upon conversion on the applicable settlement date as described above in this “—Conversion rights” section or the “—Repurchase at option of the holder upon a fundamental change” section, as applicable, as if we had not made an exchange in lieu of conversion or repurchase election. Our designation of a financial institution to which the notes may be submitted for exchange does not require the financial institution to accept any notes. We may, but will not be obligated to, enter into a separate agreement with any designated financial institution that would compensate it for any such transaction.” |
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The Preliminary Offering Memorandum will be changed by deleting the third bullet under the paragraph that begins “In the event of a fundamental change” in the section titled “Description of notes—Repurchase at option of the holder upon a fundamental change,” on page 52 (which bullet, for the avoidance of doubt, starts with “otherwise comply with all federal and state securities laws”) and replacing it with the following bullet (as well as making any additional conforming changes consistent with such insertion): |
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· “otherwise comply with all federal and state securities laws in connection with any offer by us to purchase the notes upon a fundamental change including in connection with any designation of a financial institution for exchange in lieu of repurchase as described under “—Conversion rights—Exchange in lieu of conversion or repurchase” above and any notification to holders thereof.” |
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Adjustment to Conversion Rate upon a Make-Whole Fundamental Change: |
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The table below sets forth the number of additional shares of common stock by which the conversion rate will be increased per $1,000 principal amount of notes in connection with a “make-whole fundamental change” as described in the Preliminary Offering Memorandum for each stock price and effective date set forth below. |
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Stock Price | ||||||||||||||||||||||||||
Effective Date |
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$12.28 |
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$14.00 |
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$16.00 |
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$16.58 |
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$18.00 |
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$20.00 |
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$25.00 |
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$30.00 |
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$35.00 |
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$40.00 |
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$50.00 |
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$60.00 |
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$75.00 |
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$100.00 |
June 15, 2015 |
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21.1123 |
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17.2812 |
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13.7075 |
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12.8741 |
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11.1097 |
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9.1609 |
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5.9855 |
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4.1412 |
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2.9777 |
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2.1988 |
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1.2593 |
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0.7441 |
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0.3348 |
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0.0593 |
June 15, 2016 |
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21.1123 |
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17.7230 |
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13.9178 |
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13.0352 |
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11.1739 |
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9.1324 |
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5.8497 |
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3.9798 |
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2.8206 |
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2.0564 |
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1.1518 |
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0.6663 |
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0.2887 |
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0.0427 |
June 15, 2017 |
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21.1123 |
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17.8110 |
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13.8031 |
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12.8798 |
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10.9430 |
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8.8377 |
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5.5116 |
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3.6654 |
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2.5476 |
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1.8259 |
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0.9923 |
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0.5574 |
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0.2282 |
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0.0234 |
June 15, 2018 |
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21.1123 |
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18.0311 |
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13.7270 |
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12.7440 |
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10.6953 |
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8.4945 |
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5.0995 |
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3.2824 |
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2.2187 |
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1.5524 |
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0.8095 |
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0.4370 |
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0.1648 |
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0.0072 |
June 15, 2019 |
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21.1123 |
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17.6069 |
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13.0498 |
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12.0220 |
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9.9012 |
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7.6638 |
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4.3374 |
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2.6566 |
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1.7240 |
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1.1665 |
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0.5761 |
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0.2950 |
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0.0972 |
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0.0000 |
June 15, 2020 |
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21.1123 |
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16.7640 |
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11.8821 |
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10.8026 |
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8.6112 |
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6.3689 |
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3.2445 |
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1.8242 |
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1.1109 |
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0.7187 |
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0.3354 |
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0.1628 |
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0.0425 |
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0.0000 |
June 15, 2021 |
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21.1123 |
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14.8759 |
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9.5577 |
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8.4292 |
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6.2197 |
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4.1165 |
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1.6222 |
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0.7653 |
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0.4323 |
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0.2783 |
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0.1365 |
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0.0655 |
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0.0080 |
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0.0000 |
June 15, 2022 |
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21.1123 |
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11.1077 |
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2.1791 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
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0.0000 |
The exact stock prices and effective dates may not be set forth in the table above, in which case:
· if the stock price is between two stock prices in the table or the effective date is between two effective dates in the table, the number of additional shares by which the conversion rate will be increased will be determined by a straight-line interpolation between the number of additional shares set forth for the higher and lower stock prices and the earlier and later effective dates, as applicable, based on a 365-day year;
· if the stock price is more than $100.00 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion rate; and
· if the stock price is less than $12.28 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion rate.
Notwithstanding the foregoing, in no event will the conversion rate per $1,000 principal amount of notes exceed 81.4332 shares of our common stock, subject to adjustment in the same manner, at the same time and for the same events as the conversion rate as set forth under “Description of notes—Conversion rights—Conversion rate adjustments” in the Preliminary Offering Memorandum.
General
This communication is intended for the sole use of the person to whom it is provided by the sender.
This material is confidential and is for your information only and is not intended to be used by anyone other than you. This information does not purport to be a complete description of the Notes or the offering. This communication shall not constitute an offer to sell or the solicitation of an offer to buy the Notes or any securities nor shall there be any sale of any securities in any state or jurisdiction in which such solicitation or sale would be unlawful prior to registration or qualification of such securities under the laws of any such state or jurisdiction.
Neither the Notes nor the shares of Ironwood Class A common stock issuable upon conversion of the Notes have been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, and neither may be offered or sold in the United States or any other jurisdiction, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and any other applicable securities laws. Accordingly, the Notes are being offered and sold only to “qualified institutional buyers” as defined in Rule 144A promulgated under the Securities Act. The Notes are not transferable except in accordance with the restrictions described under “Transfer restrictions” in the Preliminary Offering Memorandum.
A copy of the Preliminary Offering Memorandum for the offering of the Notes may be obtained by contacting X.X. Xxxxxx Securities LLC (toll free) at 866-803-9204 or Credit Suisse Securities (USA) LLC (toll free) at 800-221-1037.
ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED. SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.
Exhibit A
FORM OF LOCK-UP AGREEMENT
June [·], 2015
X.X. XXXXXX SECURITIES LLC
CREDIT SUISSE SECURITIES (USA) LLC
As representatives of
the several Initial Purchasers listed in
Schedule 1 to the Purchase
Agreement referred to below
c/o X.X. Xxxxxx Securities LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Credit Suisse Securities (USA) LLC
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: IRONWOOD PHARMACEUTICALS, INC. --- Rule 144A Offering
Ladies and Gentlemen:
The undersigned understands that you, as representatives of the several Initial Purchasers, propose to enter into a Purchase Agreement (the “Purchase Agreement”) with Ironwood Pharmaceuticals, Inc., a Delaware corporation (the “Company”), providing for the purchase and resale (the “Placement”) by the several Initial Purchasers named in Schedule 1 to the Purchase Agreement (the “Initial Purchasers”) of Convertible Senior Notes of the Company (the “Securities”). The Securities will be convertible into cash, shares of Class A common stock, par value $0.001 per share, of the Company (the “Common Stock”), or a combination thereof, at the Company’s election.
In consideration of the Initial Purchasers’ agreement to purchase and make the Placement of the Securities, and for other good and valuable consideration receipt of which is hereby acknowledged, the undersigned hereby agrees that, without the prior written consent of X.X. Xxxxxx Securities LLC and Credit Suisse Securities (USA) LLC on behalf of the Initial Purchasers, the undersigned will not, during the period ending 30 days after the date of the offering memorandum relating to the Placement (the “Offering Memorandum”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock (including without limitation, (i) Common Stock or such other securities which may be deemed to be beneficially owned by the undersigned in accordance with the rules and regulations of the Securities and Exchange Commission, (ii) securities which may be issued upon exercise of a stock option or warrant and (iii) shares of the Company’s Class B common stock, par value $0.001 per share (“Class B Common Stock”)), or publicly disclose the intention to make any offer, sale, pledge or disposition, (2) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Common Stock or such other securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (3) make any demand for, or exercise any right with respect to, the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock,
in each case other than (A) transactions relating to shares of Common Stock or other securities acquired in open market transactions occurring after the completion of the Placement, provided that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), shall be required or shall be made voluntarily in connection with subsequent sales of Common Stock or other securities acquired in such open market transactions, (B) transfers of shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock as a bona fide gift or gifts, to a trust established by the undersigned or by intestacy, (C) distributions of shares of Common Stock or Class B Common Stock to limited or general partners, members, stockholders or affiliates (as defined in Rule 12b-2 of the Exchange Act) of the undersigned, (D) the exercise of an option to purchase shares of Common Stock or Class B Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or Class B Common Stock or the vesting of any other award, in each case, granted on or prior to date of the Offering Memorandum under a stock incentive plan of the Company described in the Offering Memorandum, or the disposition to the Company of shares of restricted Common Stock or Class B Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or Class B Common Stock granted pursuant to the terms of a stock incentive plan of the Company on or prior to the date of the Offering Memorandum or (E) sales pursuant to a trading plan established to provide an affirmative defense pursuant to Rule 10b5-1 under the Exchange Act provided that such existing plan or plans which the undersigned plans to establish within the 30 day restricted period have been disclosed to you prior to or in connection with the execution of this Letter Agreement by the undersigned; provided that in the case of any transfer or distribution pursuant to clause (B) or (C), each donee, transferee or distributee shall execute and deliver to you a lock-up letter substantially in the form of this paragraph, provided however, that distributees that are limited partners or members of the undersigned may receive distributions of Common Stock and Class B Common Stock during the 30 day restricted period without being required to sign a lock-up letter pursuant to this clause; and provided, further, that in the case of any transfer or distribution pursuant to clause (B) or (C), no filing by any party (donor, donee, transferor or transferee) under Section 16(a) of the Exchange Act, or other public announcement shall be required or shall be made voluntarily during the 30 day restricted period in connection with such transfer or distribution, provided however, that any filings made under Section 16(a) of the Exchange Act in connection with distributions of Common Stock or Class B Common Stock during the 30 day restricted period to distributees that are limited partners or members of the undersigned may be filed and shall not be considered to be in violation of this Letter Agreement.
If any record or beneficial owner of capital stock of the Company that has executed a lock-up in the form of this Letter Agreement is granted an early release from the restrictions described herein during the 30 day restricted period (whether in one or multiple releases), then all holders that have executed a lock-up agreement in the form of this Letter Agreement shall also be granted an early release from their obligations hereunder on a pro rata basis based on the maximum percentage of shares held by any such record or beneficial holder being released from such holder’s lock-up agreement. X.X. Xxxxxx Securities LLC and Credit Suisse Securities (USA) LLC shall use commercially reasonable efforts to provide notice to the Company (which notice the Company will forward to each holder that has executed a lock-up agreement in the form of this Letter Agreement) upon the occurrence of a release of a stockholder of its obligations under any lock-up agreement executed in connection with the Placement that gives rise to a corresponding release of other holders pursuant to the terms of this paragraph; provided that the failure to give such notice shall not give rise to any claim or liability against the Initial Purchasers. Notwithstanding any other provisions of this Letter Agreement (1) X.X. Xxxxxx Securities LLC and Credit Suisse Securities (USA) LLC, as representatives for the Initial Purchasers, in their sole judgment may provide early releases from the restrictions described herein during the 30 day restricted period for up to 100,000 shares in the aggregate to all holders that have executed a lock-up agreement in the form of this Letter Agreement provided no individual holder receives a release for more than 20,000 shares and (2) if X.X. Xxxxxx Securities LLC and Credit Suisse Securities (USA) LLC, as representatives for the Initial Purchasers, in their sole judgment determine that a record or beneficial owner of capital stock should be granted an early release from a lock-up agreement due to circumstances of an
emergency or hardship, then no other holder shall have any right to be granted an early release pursuant to the terms of this paragraph.
In furtherance of the foregoing, the Company, and any duly appointed transfer agent for the registration or transfer of the securities described herein, are hereby authorized to decline to make any transfer of securities if such transfer would constitute a violation or breach of this Letter Agreement.
The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Letter Agreement. All authority herein conferred or agreed to be conferred and any obligations of the undersigned shall be binding upon the successors, assigns, heirs or personal representatives of the undersigned.
The undersigned understands that, if the Purchase Agreement does not become effective, or if the Purchase Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Securities to be sold thereunder, the undersigned shall be released from all obligations under this Letter Agreement. The undersigned understands that the Initial Purchasers are entering into the Purchase Agreement and proceeding with the Placement in reliance upon this Letter Agreement.
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This Letter Agreement and any claim, controversy or dispute arising under or related to this Letter Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws principles thereof.
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[NAME OF STOCKHOLDER] | ||
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