Exhibit 99.1
GENELABS TECHNOLOGIES, INC.
Company
and
NATEXIS BLEICHROEDER INC.
Underwriter
____________________________
UNDERWRITING AGREEMENT
Dated as of October 16, 2003
____________________________
Table of Contents
Page
----
Section 1. Representations and Warranties.....................................2
Section 2. Sale and Delivery to the Underwriter; Closing......................8
Section 3. Certain Covenants of the Company...................................8
Section 4. Payment of Fees and Expenses; Future Offerings....................11
Section 5. Conditions to the Obligations of the Underwriter
and the Sale of Shares............................................12
Section 6. Conditions to Purchase of Option Shares...........................14
Section 7. Indemnification...................................................15
Section 8. Contribution......................................................17
Section 9. Representations, Warranties and Agreements to Survive Delivery....18
Section 10. Termination of Agreement..........................................18
Section 11. Notices...........................................................19
Section 12. Parties...........................................................20
Section 13. Governing Law.....................................................20
Section 14. Severability......................................................20
Section 15. Headings..........................................................20
Section 16. Counterparts......................................................20
Exhibit A Form of Opinion of Company's Counsel
Exhibit B Form of Letter from Company's Counsel
Exhibit C List of Persons Subject to Lock-Up Agreement
Exhibit D Form of Lock-Up Agreement
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October 16, 2003
Natexis Bleichroeder Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
Genelabs Technologies, Inc., a California corporation (the "Company"),
proposes, subject to the terms and conditions set forth in this agreement
(together with the exhibits attached hereto, this "Agreement"), to issue and
sell to Natexis Bleichroeder Inc. (the "Underwriter") an aggregate amount of
20,000,000 shares of common stock, no par value per share (shares of which class
stock of the Company are hereinafter referred to as "Common Stock"), of the
Company (the "Initial Shares"). The Company also proposes to sell to the
Underwriter not more than an additional 3,000,000 shares of Common Stock (the
"Option Shares"), if and to the extent that the Underwriter shall have
determined to exercise the right to purchase such shares of Common Stock granted
to the Underwriter pursuant to Section 2 hereof. The Initial Shares and the
Option Shares are hereinafter collectively referred to as the "Shares".
The Company has filed with the Securities and Exchange Commission (the
"Commission") a shelf registration statement on Form S-3 (File No. 333-108608)
relating to certain securities and the offering thereof from time to time in
accordance with Rule 415 of the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder (the "Securities Act"). Such
registration statement, including the exhibits thereto and the documents filed
by the Company with the Commission pursuant to the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(the "Exchange Act") that are incorporated by reference therein, as amended at
the date hereof, is herein referred to as the "Registration Statement". The
Registration Statement was declared effective by the Commission on September 15,
2003. A preliminary prospectus supplement reflecting the terms of the Shares,
the terms of the offering thereof and the other matters set forth therein, has
been prepared and filed pursuant to Rule 424 under the Securities Act and a
final prospectus supplement will be prepared and filed pursuant to Rule 424
under the Securities Act. Such final prospectus supplement, in the form first
filed on or after the date hereof pursuant to Rule 424, is herein referred to as
the "Prospectus Supplement". The base prospectus, dated September 30, 2003,
included in the Registration Statement relating to offerings of the Company's
securities generally, as supplemented by the Prospectus Supplement, and
including the documents incorporated by reference therein, is herein called the
"Prospectus", except that, if such base prospectus is amended or supplemented on
or prior to the date on which the Prospectus Supplement is first filed pursuant
to Rule 424, the term "Prospectus" shall refer to such base prospectus as so
amended or supplemented and as supplemented by the Prospectus Supplement, in
either case including the documents incorporated by reference therein. Any
reference herein to the terms "amendment" or "supplement" with respect to the
Registration Statement, the Prospectus or any preliminary prospectus shall be
deemed to refer to and include any documents filed with the Commission under the
Exchange Act after the date hereof, the date the Prospectus
is filed with the Commission, or the date of such preliminary prospectus, as the
case may be, and incorporated therein by reference pursuant to Item 12 of Form
S-3 under the Securities Act.
Section 1. Representations and Warranties. The Company represents and
warrants to and agrees with the Underwriter that:
(a) Compliance with Registration Requirements. (i) The Company
meets the requirements for use of Form S-3 under the Securities Act. The
Registration Statement has become effective; no stop order suspending the
effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the
Commission; and (ii)(A) each document, if any, filed or to be filed
pursuant to the Exchange Act and incorporated by reference in the
Prospectus complied or will comply when so filed in all material respects
with the Exchange Act and the applicable rules and regulations of the
Commission thereunder, (B) each part of the Registration Statement, when
such part became effective, did not contain, and each such part, as amended
or supplemented, if applicable, will not contain, when so amended or
supplemented, 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, (C) the Registration Statement, when it
became effective, and the Prospectus comply, and, as amended or
supplemented, if applicable, will comply, when so amended or supplemented,
in all material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder and (D) the Prospectus, as of
its date, did not contain and, as amended or supplemented, if applicable,
will not, when so amended or supplemented, 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. Notwithstanding the foregoing, the Company makes no
representations or warranties as to information, if any, contained in or
omitted from the Prospectus or any amendment thereof or supplement thereto
in reliance upon and in conformity with information furnished in writing to
the Company by or on behalf of the Underwriter specifically for use in the
Registration Statement or the Prospectus.
(b) Independent Accountants. Ernst & Young LLP, the accountants
who certified the audited financial statements included in or incorporated
by reference into the Registration Statement, are independent public
accountants as required by the Securities Act.
(c) Authorization of Underwriting Agreement. This Agreement has
been duly authorized, executed and delivered by the Company.
(d) Financial Statements. The consolidated financial statements,
together with the related notes and schedules, included in or incorporated
by reference into the Registration Statement present fairly the
consolidated financial position of the Company and its Subsidiaries (as
defined herein) as of and for the dates indicated and the consolidated
results of its operations and the consolidated cash flows of the Company
and its Subsidiaries for the periods specified. Such financial statements
have been prepared in conformity with accounting principles generally
accepted in the United States ("GAAP") applied on a consistent basis
throughout the periods involved, except as may
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otherwise be specified in such financial statements or notes
thereto. The financial statement schedules, if any, included in or
incorporated by reference into the Registration Statement present fairly in
accordance with GAAP the information required to be stated therein.
(e) Good Standing of the Company. The Company has been duly
incorporated and is validly existing and in good standing as a corporation
under the laws of the State of California with corporate power and
authority under such laws to own, lease and operate its properties and
conduct its business as described in the Prospectus; and the Company is
duly qualified to transact business as a foreign corporation and is in good
standing in each other jurisdiction in the United States in which the
Company owns or leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except to the extent
that the failure to so qualify or be in good standing would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company and its
Subsidiaries, considered as one enterprise (a "Material Adverse Effect").
(f) Good Standing of Subsidiaries. The Company's direct
subsidiaries are Accelerated Clinical Research Organization, Inc., Genelabs
Diagnostic, Inc., and Genelabs Europe B.V. (each, a "Subsidiary" and,
collectively, the "Subsidiaries"). Each Subsidiary is an entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization with requisite power and authority under
such laws to own, lease and operate its properties and conduct its business
as currently conducted. Each Subsidiary is duly qualified to transact
business as a foreign corporation and is in good standing in each other
jurisdiction in which it owns or leases property of a nature, or transacts
business of a type, that would make such qualification necessary, except to
the extent that the failure to so qualify or be in good standing would not
have a Material Adverse Effect. All of the outstanding shares of capital
stock of each Subsidiary have been duly authorized and validly issued and
are fully paid and non-assessable and are owned, directly or indirectly, by
the Company free and clear of any pledge, lien, security interest, charge,
claim, equity or encumbrance of any kind.
(g) Authorization and Description of the Shares. (i) The Shares
have been duly authorized and, when issued and paid for in accordance with
this Agreement, will be validly issued, fully paid and non-assessable; the
issuance of such Shares is not subject to the preemptive rights of any
stockholder of the Company; and, at Closing Time, all corporate action
required to be taken for the authorization, issue and sale of such Shares
will have been validly and sufficiently taken. The Common Stock conforms in
all material respects to the description thereof contained in the
Prospectus under the section entitled "Description of the Common Stock and
Preferred Stock We May Offer - Common Stock."
(ii) All of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; and none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive rights of any stockholder
of the Company.
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(h) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Prospectus, except as
otherwise stated therein or contemplated thereby, there has not been (i)
any material adverse change in the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company and its
Subsidiaries, considered as one enterprise (a "Material Adverse Change"),
(ii) any transaction entered into by the Company or any Subsidiary, other
than in the ordinary course of business, that is material to the Company
and its Subsidiaries, considered as one enterprise, or (iii) any dividend
or distribution of any kind declared, paid or made by the Company on its
capital stock.
(i) Absence of Defaults and Conflicts. Neither the Company nor any
Subsidiary is in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument to which it is a party or by which it is bound or to which any
of its properties is subject, except for such defaults that would not have
a Material Adverse Effect. The execution and delivery of this Agreement by
the Company, the consummation by the Company of the transactions
contemplated in this Agreement and compliance by the Company with the terms
of this Agreement have been duly authorized by all necessary corporate
action on the part of the Company and do not and will not result in any
violation of the charter or by-laws of the Company or any Subsidiary, and
do not and will not conflict with, or result in a breach of any of the
terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company or any Subsidiary under (i) any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument to which the Company or such Subsidiary is a party or by which
it is bound or to which any of its properties is subject or (ii) any
existing applicable law, rule, regulation, judgment, order or decree of any
government, governmental instrumentality or court, domestic or foreign,
having jurisdiction over the Company or such Subsidiary or any of their
respective properties; except, in the case of clauses (i) and (ii), such as
would not have a Material Adverse Effect.
(j) Absence of Further Requirements. No filing by the Company
with, or authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the Offering, except (i) such as
have been already obtained, (ii) such as may be required by the securities
or "blue sky" laws of the various states in connection with the offer and
sale of the Shares, (iii) the application to the Nasdaq National Market for
the listing of the Shares for quotation thereon and (iv) the filing of the
Prospectus with the Commission.
(k) Absence of Proceedings. Except as disclosed in the Prospectus,
there is no action, suit or proceeding before or by any government,
governmental instrumentality or court, domestic or foreign, now pending or,
to the knowledge of the Company, threatened against the Company or any
Subsidiary, that if determined adversely to the Company or such Subsidiary,
(i) would result in a Material Adverse Change, (ii) would materially and
adversely affect the properties or assets of the Company and its
Subsidiaries, considered as one enterprise, or (iii) that would materially
and adversely affect the consummation of the
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transactions contemplated in this Agreement; the aggregate of all
pending legal or governmental proceedings that are not described in the
Prospectus to which the Company or any Subsidiary is a party or which
affect any of its properties, including ordinary routine litigation
incidental to the business of the Company or such Subsidiary, if determined
adversely to the Company or such Subsidiary, would not have a Material
Adverse Effect.
(l) Title to Property. Each of the Company and the Subsidiaries
has good and marketable title to all properties and assets described in the
Prospectus material to the business of the Company and the Subsidiaries
considered as one enterprise, free and clear of all liens, charges,
encumbrances or restrictions, except such as (i) are described in the
Prospectus or (ii) are neither material in amount nor materially
significant to the business of the Company and its Subsidiaries, considered
as one enterprise; all of the leases and subleases material to the business
of the Company and its Subsidiaries, considered as one enterprise, and
under which the Company or any Subsidiary holds properties described in the
Prospectus, are in full force and effect, and neither the Company nor any
Subsidiary has any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Company or such Subsidiary
under any of the leases or subleases mentioned above, or affecting or
challenging the rights of such corporation to the continued possession of
the leased or subleased premises under any such lease or sublease, except
to the extent as would not have a Material Adverse Effect.
(m) Possession of Licenses and Permits. Each of the Company and
the Subsidiaries owns, possesses or has obtained all material governmental
licenses, permits, certificates, consents, orders, approvals and other
authorizations necessary to carry on its business as presently conducted,
and neither the Company nor any Subsidiary has received any notice of
proceedings relating to revocation or modification of any such licenses,
permits, certificates, consents, orders, approvals or authorizations which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a Material Adverse Effect.
(n) FDA and PTO Proceedings. To the best of the Company's
knowledge, there are no rulemaking or similar proceedings before the U.S.
Food and Drug Administration or the U.S. Patent and Trademark Office which
affect or involve the Company or any of the processes or products which the
Company has developed, is developing or proposes to develop or uses or
proposes to use which, if the subject of an action unfavorable to the
Company, would have a Material Adverse Effect.
(o) Possession of Intellectual Property. The Company and the
Subsidiaries have or have rights to use, all patents, patent applications,
trademarks, trademark applications, service marks, trade names, copyrights,
licenses, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures) or other similar rights that are necessary or material to
continue to carry on their respective businesses as currently conducted
(collectively, "Intellectual Property"), except where the failure to so
possess would not have a Material Adverse Effect; except as disclosed in
the Prospectus, (i) neither the Company nor any Subsidiary has received any
notice that the Intellectual Property used by the Company or any
5
Subsidiary violates or infringes upon the rights of any person and
(ii) to the knowledge of the Company, all such Intellectual Property is
enforceable and there is no existing infringement by another person of any
of the Intellectual Property, except, in each of clauses (i) and (ii), as
would not have a Material Adverse Effect.
(p) Absence of Labor Dispute. To the best knowledge of the
Company, (i) no labor dispute exists with its employees or with employees
of any Subsidiary or is imminent that would reasonably be expected to have
a Material Adverse Effect, and (ii) no labor disturbance by the employees
of any of its or any Subsidiary's principal contractors or customers is
existing or imminent that would reasonably be expected to have a Material
Adverse Effect.
(q) Market Stabilization. The Company has not taken and will not
take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of
the price of the Common Stock.
(r) Investment Company Act. The Company is not and, after giving
effect to the offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus, will not be an "investment
company" or an entity "controlled" by an "investment company", as such
terms are defined in the Investment Company Act of 1940, as amended.
(s) Insurance. (i) The Company is insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are customary in the businesses in which it is engaged and
(ii) there are no material claims by the Company or any Subsidiary under
any such policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause.
(t) Environmental Laws. Except as disclosed in the Prospectus and
except as would not have a Material Adverse Effect, (i) the Company and the
Subsidiaries are each in compliance with all applicable Environmental Laws,
(ii) the Company and the Subsidiaries have all permits, authorizations and
approvals required under any applicable Environmental Laws and are in
compliance with their requirements, (iii) there are no pending or, to the
Company's knowledge, threatened Environmental Claims against the Company or
any Subsidiary and (iv) there are no circumstances with respect to any
property or operations of the Company or any Subsidiary that would
reasonably be anticipated to form the basis of an Environmental Claim
against the Company or such Subsidiary.
For purposes of this Agreement, the following terms shall have the
following meanings: "Environmental Law" means any United States (or other
applicable jurisdiction's) federal, state, local or municipal statute, law,
rule, regulation, ordinance, code, policy or rule of common law and any
judicial or administrative interpretation thereof including any judicial or
administrative order, consent decree or judgment, relating to the
environment, health, safety or any chemical, material or substance,
exposure to which is prohibited, limited or regulated by any governmental
authority. "Environmental Claims" means any and all administrative,
regulatory or judicial actions,
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suits, demands, demand letters, claims, liens, notices of noncompliance
or violation, investigations or proceedings relating in any way to any
Environmental Law.
(u) Internal Controls. The Company maintains a system of internal
accounting controls sufficient to provide reasonable assurances 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 GAAP and to
maintain accountability for assets, (iii) access to assets is permitted
only in accordance with management's general or specific authorization and
(iv) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect
to any differences.
(v) Tax Returns. All United States federal income tax returns of
the Company and its Subsidiaries required by law to be filed have been
filed and all taxes shown by such returns or otherwise assessed, which are
due and payable, have been paid, except assessments that are being
contested in good faith by the Company or for which the failure to pay
would not have a Material Adverse Effect. The Company and its subsidiaries
have filed all other tax returns that are required to have been filed by
them pursuant to applicable foreign, state, local or other law except
insofar as the failure to file such returns would not have a Material
Adverse Effect, and have paid all taxes due pursuant to such returns or
pursuant to any assessment received by the Company and its Subsidiaries,
except for such taxes, if any, as are being contested in good faith and as
to which adequate reserves have been provided or for which the failure to
pay would not have a Material Adverse Effect. The charges, accruals and
reserves on the books of the Company and its Subsidiaries in respect of any
income and corporation tax liability for any years not finally determined
are adequate to meet any assessments or re-assessments for additional
income tax for any years not finally determined, except to the extent of
any inadequacy that would not result in a Material Adverse Effect.
(w) Solvency. After giving effect to the offering and sale of all
or substantially all of the Shares and the application of the proceeds
thereof as described in the Prospectus, (i) the Company's fair saleable
value of its assets exceeds the amount that will be required to be paid on
or in respect of the Company's existing debts and other liabilities
(including known contingent liabilities) as they mature; (ii) the Company's
assets do not constitute unreasonably small capital to carry on its
business for the current fiscal year as now conducted and as proposed to be
conducted as disclosed in the Prospectus including its capital needs,
taking into account the particular capital requirements of the business
conducted by the Company and its Subsidiaries, and projected capital
requirements and capital availability thereof; and (iii) the current cash
flow of the Company, together with the proceeds the Company would receive,
were it to liquidate all of its assets, after taking into account all
anticipated uses of the cash, would be sufficient to pay all amounts on or
in respect of its debt when such amounts are required to be paid. The
Company does not intend to incur debts beyond its ability to pay such debts
as they mature (taking into account the timing and amounts of cash to be
payable on or in respect of its debt).
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(x) Listing and Maintenance Requirements. The Company has not, in
the six months preceding the date hereof, received notice (written or oral)
from the Nasdaq National Market to the effect that the Company is not in
compliance with the listing or maintenance requirements thereof. The
Company is in compliance with the listing and maintenance requirements for
continued trading of the Common Stock on the Nasdaq National Market.
Section 2. Sale and Delivery to the Underwriter; Closing. (a) On the
basis of the representations and warranties herein contained, and subject to the
terms and conditions herein set forth, the Company agrees to sell the Initial
Shares to the Underwriter, and the Underwriter agrees to purchase the Initial
Shares from the Company at the purchase price of U.S.$1.2878 per share (the
"Purchase Price").
(b) In addition, on the basis of the representations and
warranties herein contained, and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriter to
purchase up to an additional 3,000,000 Option Shares at the Purchase Price.
The option hereby granted will expire 30 days after the date hereof, and
may be exercised, in whole or from time to time in part, only for the
purpose of covering over-allotments that may be made in connection with the
offering and distribution of the Initial Shares upon notice by the
Underwriter to the Company setting forth the number of Option Shares as to
which the Underwriter is exercising the option, and the time and date of
payment and delivery thereof. Such time and date of delivery (the "Date of
Delivery") shall be determined by the Underwriter but shall not be later
than seven full business days after the exercise of such option, nor in any
event prior to the Closing Time.
(c) Payment of the purchase price for, and delivery of, the
Initial Shares shall be made at the offices of Shearman & Sterling LLP,
0000 Xxxxx Xxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000-0000, or at such other place
as shall be agreed upon by the Company and the Underwriter, at 7:00 A.M.,
California Time, on the third full business day after the date hereof, or
at such other time not more than ten full business days thereafter as the
Company and the Underwriter shall determine (such date and time of payment
and delivery being herein called the "Closing Time"). In addition, in the
event that any or all of the Option Shares are purchased by the
Underwriter, payment of the purchase price for, and delivery of, such
Option Shares shall be made at the offices of Shearman & Sterling LLP set
forth above, or at such other place as the Company and the Underwriter
shall determine, on each Date of Delivery as specified in the notice from
the Underwriter to the Company. Payment shall be made to the Company in
Federal or other funds immediately available in New York City against
delivery to the Underwriter of the Initial Shares or the Option Shares, as
the case may be.
Section 3. Certain Covenants of the Company. The Company covenants with
the Underwriter as follows:
(a) The Company shall furnish to the Underwriter, without charge,
prior to 1:00 P.M., California time, on the business day next succeeding
the date of this Agreement and during such period after the first date of
the public offering of the Shares
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when the Prospectus is, in the opinion of counsel, required by law
to be delivered in connection with sales of the Shares by the Underwriter
or dealer, as many copies of the Prospectus, and any supplements or
amendments thereto, as the Underwriter may reasonably request.
(b) The Company shall furnish to the Underwriter as many conformed
copies of the Registration Statement (as originally filed) and of all
amendments thereto, whether filed before or after such Registration
Statement became effective, as the Underwriter may reasonably request.
(c) Promptly following the execution of this Agreement, the
Company shall prepare a Prospectus Supplement that complies in all material
respects with the Securities Act and that sets forth the material
information regarding the Shares, the price at which the Shares are to be
purchased by the Underwriter from the Company, any public offering price,
any selling concession and reallowance and any delayed delivery
arrangements, and such other information as the Underwriter and the Company
deem appropriate in connection with the offering of the Shares. The Company
will timely transmit copies of the Prospectus Supplement to the Commission
for filing pursuant to Rule 424 under the Securities Act.
(d) Before amending or supplementing the Registration Statement or
the Prospectus during the period referred to in Subsection 3(a) above, the
Company shall furnish the Underwriter with a copy of each such proposed
amendment or supplement, and shall not file any such proposed amendment or
supplement if the Underwriter reasonably objects in good faith by notice to
the Company within three business days of receipt thereof; provided,
however, that the Company shall have no such obligation under this
Subsection 3(d) with respect to periodic reports filed pursuant to Section
13(a) of the Exchange Act.
(e) During the period mentioned in Subsection 3(a) above, the
Company shall notify the Underwriter with reasonable promptness of (i) the
effectiveness of any amendment to the Registration Statement, (ii) the
transmittal to the Commission for filing of any supplement to the
Prospectus or any document that would as a result thereof be incorporated
by reference in the Prospectus, (iii) the receipt of any comments from the
Commission with respect to the Registration Statement, the Prospectus or
the Prospectus Supplement, (iv) any request by the Commission for any
amendment to the Registration Statement or any supplement to the Prospectus
or for additional information relating thereto or to any document
incorporated by reference in the Prospectus and (v) the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement, of the suspension of the qualification of the
Shares for offering or sale in any jurisdiction, or of the institution or
threatening of any proceeding of which the Company is aware for any of such
purposes; and to use its reasonable best efforts, if any such order is
issued, to obtain the lifting thereof as early as practicable.
(f) The Company shall use its best efforts to comply with the
Securities Act, the Exchange Act and, in each case, the rules and
regulations of the Commission thereunder so as to permit the completion of
the distribution of the Shares as
9
contemplated in this Agreement and in the Prospectus. If at any
time when a prospectus is required by the Securities Act to be delivered by
the Underwriter or a dealer in connection with sales of the Shares as
contemplated by the Prospectus any event shall occur or condition exist as
a result of which it is necessary, in the reasonable opinion of counsel for
the Underwriter or counsel for the Company, to amend the Registration
Statement or amend or supplement the Prospectus in order that the
Prospectus 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
not misleading in the light of the circumstances existing at the time it is
delivered to a purchaser of the Shares, or if it shall be necessary, in the
opinion of either such counsel, at any such time to amend the Registration
Statement or amend or supplement the Prospectus in order to comply with the
requirements of the Securities Act or the rules and regulations of the
Commission thereunder, the Company will promptly prepare and file with the
Commission, subject to Subsection 3(d) hereof, such amendment or supplement
as may be necessary to correct such untrue statement or omission or to make
the Registration Statement or the Prospectus comply with such requirements.
(g) The Company shall fully cooperate with the Underwriter to
qualify the Shares for offering and sale under the applicable securities
laws of such states and other jurisdictions as the Underwriter may
designate and to maintain such qualifications in effect for a period
necessary for the distribution of the Shares; provided, however, that the
Company shall not be obligated to file any general consent to service of
process or to qualify as a foreign corporation or as a dealer in shares in
any jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is
not otherwise so subject. The Company shall file such statements and
reports as may be required by the laws of each jurisdiction in which the
Shares have been qualified as above provided.
(h) The Company will timely file such reports pursuant to the
Exchange Act necessary to make generally available to its security holders,
as soon as practicable, an earnings statement of the Company (in form
complying with the provisions of Rule 158 of the Securities Act) for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the Securities Act.
(i) If the proceeds from the Offering of the Shares exceed
$10,000,000 in aggregate, the Company shall not, without the prior written
consent of the Underwriter, during the period commencing on the date hereof
and ending 90 days after the date of the Prospectus, (i) offer, pledge,
sell, contract to sell, sell any option or contract to purchase, grant any
option, right or warrant to purchase or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any shares
convertible into or exercisable or exchangeable for Common Stock (whether
such shares or any such shares are now owned by the Company or hereafter
reacquired) or (ii) enter into any swap or other agreement that transfers
to another, in whole or in part, any of the economic consequences of
ownership of the Common Stock, whether any such transaction described in
clause (i) or (ii) above is to be settled by delivery of Common Stock or
such other shares, in cash or otherwise. The foregoing sentence shall not
apply to (x) the Shares to be offered for sale hereunder or options to be
issued or shares to be sold under
10
the Company's stock option plan and the stock purchase plan (each
as described in the Prospectus) or (y) securities issued in connection with
a partnership, joint or collaborative venture, licensing or similar
arrangements involving one or more of the Company's or a third party's
pharmaceutical products, intellectual property and/or drug candidates.
(j) The Company shall use its reasonable best efforts to obtain a
"lock-up" agreement from each person listed in Exhibit C hereto, each
substantially in the form of Exhibit D hereto, prior to the Closing Time.
Section 4. Payment of Fees and Expenses; Future Offerings. (a) The
Company agrees to pay and bear all expenses incident to the performance of the
Company's obligations under this Agreement, including (i) the printing and
filing of the Registration Statement (including financial statements and
exhibits), as originally filed and as amended, the Prospectus and any amendments
or supplements thereto, and the cost of furnishing copies thereof to the
Underwriter, (ii) the printing and distribution of this Agreement, (iii) the
preparation, issuance and delivery of the certificates for the Shares to the
Underwriter, if any, including any stock transfer taxes payable upon the sale of
the Shares to the Underwriter, (iv) the fees and disbursements of the Company's
counsel and accountants, (v) the fees and expenses of the Underwriter's counsel,
not to exceed $75,000 (vi) the qualification of the Shares under the applicable
securities laws in accordance with Subsection 3(g), including filing fees and
fees and disbursements of counsel for the Underwriter in connection therewith
and in connection with the preparation of the "blue sky" survey, (vii) the
reasonable fees and expenses of counsel to the Underwriter in connection with
the filing for review by the NASD, such fees and expenses of counsel for the
Underwriter pursuant to clauses (vi) and this (vii) hereof not to exceed
$15,000, including any filing fees of the NASD and (viii) the listing fees of
the Nasdaq National Market.
(b) If this Agreement is terminated in accordance with the
provisions of Section 5 or Section 10, the Company agrees to reimburse the
Underwriter for all its out-of-pocket expenses, including the actual
documented and reasonable fees and expenses of counsel for the Underwriter,
such fees and expenses of counsel not to exceed $90,000.
(c) At the Closing Time, the Company agrees to issue to the
Underwriter warrants in a form to be agreed upon by the Company and the
Underwriter to purchase such number of shares of Common Stock that is equal
to the lesser of (A) the quotient obtained by dividing (x) 2.0% of the
gross proceeds from the offering of the Shares divided by (y) $1.37 and (B)
500,000 shares (the "Warrants"), which Warrants shall have an exercise
price that is equal to the last reported sale price of the Common Stock on
the Nasdaq National Market immediately prior to the determination of the
Purchase Price and shall be for a term of five years and shall be subject
to a one year lock-up period, or such shorter period as may be applicable
under NASD rules, on the sale of the Warrants and the underlying shares of
Common Stock by the Underwriter.
(d) If the gross proceeds from the Offering of the Shares exceed
$10,000,000 and the Company shall offer and sell any securities of the
Company or the Subsidiaries in the two years after the date hereof, whether
in a private placement or in a public offering (each such offering, a
"Subsequent Offering"), the Company shall: (i) offer the
11
Underwriter the opportunity to act as lead or co-lead agent or
lead or co-lead underwriter in such Subsequent Offering and (ii) shall
offer the Underwriter the opportunity to solicit offers for, or to
underwrite, no less than 30.0% of the total securities offered in such
subsequent offering; provided, however, that in the case of each of (i) and
(ii) above, the Company's obligation to the Underwriter shall be subject to
the Company's satisfaction of its obligation, if any, existing as of the
date of this Agreement, to first offer such opportunity to another party;
provided, further, that, during the period ending one year after the
Closing Time, the Company may satisfy its obligation to the Underwriter by
paying a waiver fee to the Underwriter of $200,000 and after the date that
is one year from the Closing Time, the Company may satisfy its obligation
to the Underwriter by paying a waiver fee to the Underwriter of $100,000.
For the purposes of this Agreement, "Subsequent Offering" shall be deemed
to exclude: (w) an acquisition, sale or other extraordinary corporate
transaction involving all or substantially all the business, assets or
securities of the Company, one or more Subsidiaries or a third party; (x)
partnership, joint or collaborative venture, licensing or similar
arrangements involving one or more of the Company's, a Subsidiary's or a
third party's pharmaceutical products, intellectual property and/or drug
candidates; (y) any exercise of warrants or options for securities issued
in the ordinary course of business and not in connection with or in
contemplation of an offering; and (z) the issuance, exercise or sale of
securities in connection with the Company's stock option or employee stock
purchase plans existing on the date of this Agreement or similar plans to
be adopted in the ordinary course of business for compensation purposes.
Section 5. Conditions to the Obligations of the Underwriter and the
Sale of Shares. The obligation of the Underwriter to purchase and pay for the
Initial Shares (and any Option Shares as to which the option granted in Section
2 has been exercised and the Date of Delivery determined by the Underwriter is
the same as the Closing Time) are subject to the accuracy of the representations
and warranties of the Company contained herein or in certificates of the
Company's officers delivered pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder in all material
respects, and to the following further conditions:
(a) At the Closing Time no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the Securities
Act and no proceedings for that purpose shall have been instituted or shall
be pending or, to the knowledge of the Company or the Underwriter, shall be
contemplated by the Commission, and any request on the part of the
Commission for additional information shall have been complied.
(b) At the Closing Time, the Underwriter shall have received from
Skadden, Arps, Slate, Meagher, & Xxxx LLP, counsel for the Company, dated
as of the Closing Time, (i) an opinion in form and substance reasonably
satisfactory to counsel for the Underwriter, and substantially in the form
set forth in Exhibit A and (ii) a letter in form and substance reasonably
satisfactory to counsel for the Underwriter, and substantially in the form
set forth in Exhibit B.
12
(c) At the Closing Time, the Underwriter shall have received from
Shearman & Sterling LLP, counsel for the Underwriter, dated as of the
Closing Time, (i) an opinion in form and substance satisfactory to the
Underwriter and (ii) a letter in form and substance reasonable satisfactory
to the Underwriter and containing statements substantially to the same
effect as the letter delivered pursuant to Section 5(b)(ii).
(d) At the Closing Time, (i) the Registration Statement and
the Prospectus, as they may then be amended or supplemented, shall
contain all statements that are required to be stated therein under,
and shall conform in all material respects to the requirements of the
Securities Act and the rules and regulations of the Commission
thereunder, and (A) the Registration Statement, as it may then be
amended or supplemented, shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading and
(B) the Prospectus, as it may then be amended or supplemented, shall
not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under
which they were made, (ii) there shall not have been, since the
respective dates as of which information is given in the Prospectus
(except as set forth therein) any Material Adverse Change, (iii) no
action, suit or proceeding shall be pending or, to the knowledge of
the Company, threatened against the Company before or by any
government, governmental instrumentality or court, domestic or
foreign, that would result in any Material Adverse Change, (iv) the
Company shall have complied in all material respects with all
agreements and satisfied in all material respects all conditions on
its part to be performed or satisfied at or prior to the Closing Time
and (v) the other representations and warranties of the Company set
forth in Section 1 shall be accurate as though expressly made at and
as of the Closing Time. At the Closing Time, the Underwriter shall
have received a certificate of the Chief Executive Officer and the
Chief Financial Officer of the Company, dated as of the Closing Time,
to such effect.
(e) On or about the date of the preliminary Prospectus
Supplement, the Underwriter shall have received from Ernst & Young LLP
a letter, dated such date, in form and substance reasonably
satisfactory to the Underwriter, including confirmation that they are
independent public accountants with respect to the Company within the
meaning of the Securities Act and the applicable published rules and
regulations of the Commission thereunder.
(f) At the Closing Time, the Underwriter shall have received
from Ernst & Young LLP a letter, dated such date, affirming the
statements made in the letter furnished pursuant to Section (e) of
this Section 5.
(g) At the Closing Time, counsel for the Underwriter shall
have been furnished with all such documents, certificates and opinions
as they may reasonably require for the purpose of enabling them to
pass upon the issuance and sale of the Initial Shares as contemplated
in this Agreement and in order to evidence the accuracy and
completeness of any of the representations, warranties or statements
of the Company, the performance of any of the covenants of the
Company, or the fulfillment of any of the conditions herein contained;
and all proceedings taken by the Company at or prior to the
13
Closing Time in connection with the authorization, issuance and
sale of the Initial Shares as contemplated in this Agreement shall be
reasonably satisfactory in form and substance to the Underwriter and to
counsel for the Underwriter.
(h) The Company shall have complied in all material respects with
all requirements for the listing of the Shares on the Nasdaq National
Market.
(i) At the Closing Time, the Underwriter shall have received a
"lock-up" agreement from (i) Xxxxx Xxxx, chief executive officer of the
Company, and (ii) at least 12 of the persons listed in Exhibit C hereto,
each substantially in the form of Exhibit D hereto.
If any of the conditions specified in this Section 5 shall not have
been fulfilled when and as required by this Agreement, this Agreement may be
terminated by the Underwriter on written notice to the Company at any time at or
prior to the Closing Time, and such termination shall be without liability of
any party to any other party except as provided in Section 4 herein.
Notwithstanding any such termination, the provisions of Sections 7, 8 and 9
herein shall remain in effect.
Section 6. Conditions to Purchase of Option Shares. In the event that
the Underwriter exercise its option granted in Section 2 to purchase all or
any of the Option Shares and the Date of Delivery determined by the
Underwriter pursuant to Section 2 is later than the Closing Time, the
obligations of the Underwriter to purchase and pay for the Option Shares it
has agreed to purchase pursuant to this Agreement are subject to the accuracy
of the representations and warranties of the Company herein contained, to the
performance by the Company of its obligations hereunder in all material
respects and to the following further conditions:
(a) The Registration Statement shall remain effective at the
Date of Delivery, and at the Date of Delivery no stop order suspending
the effectiveness of the Registration Statement shall have been issued
under the Securities Act and no proceedings for that purpose shall have
been instituted or shall be pending or, to your knowledge or the
knowledge of the Company, shall be contemplated by the Commission, and
any request on the part of the Commission for additional information
shall have been complied with.
(b) At the Date of Delivery, the statements contained in Section
5(d) hereof shall be true and accurate at and as of the Date of Delivery
and, at the Date of Delivery, the Underwriter shall have received a
certificate of the Chief Executive Officer and the Chief Financial
Officer of the Company, dated as of the Date of Delivery, to such effect.
(c) At the Date of Delivery, the Underwriter shall have received
from Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Company,
an opinion and letter, dated as of the Date of Delivery, relating to the
Option Shares and otherwise to the same effect as the opinion and letter
required by Section 5(b).
(d) At the Date of Delivery, the Underwriter shall have received
from Shearman & Sterling LLP, counsel for the Underwriter, an opinion and
letter dated as of
14
the Date of Delivery, relating to the Option Shares and otherwise to the
same effect as the opinion and letter required by Section 5(c).
(e) At the Date of Delivery, the Underwriter shall have received
a letter from Ernst & Young LLP, in form and substance satisfactory to
the Underwriter and dated as of the Date of Delivery, to the effect that
they reaffirm the statements made in the letter furnished pursuant to
Section 5(e), except that the specified date referred to shall be a date
not more than three days prior to the Date of Delivery.
(f) At the Date of Delivery, counsel for the Underwriter shall
have been furnished with all such documents, certificates and opinions as
they may reasonably require for the purpose of enabling them to pass upon
the issuance and sale of the Option Shares as contemplated in this
Agreement and in order to evidence the accuracy and completeness of any
of the representations, warranties or statements of the Company, the
performance of any of the covenants of the Company, or the fulfillment of
any of the conditions herein contained; and all proceedings taken by the
Company at or prior to the Date of Delivery in connection with the
authorization, issuance and sale of the Option Shares as contemplated in
this Agreement shall be reasonably satisfactory in form and substance to
the Underwriter and to counsel for the Underwriter.
Section 7. Indemnification.(a) The Company agrees to indemnify and hold
harmless the Underwriter and each person, if any, who controls the Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by an omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances under which they were made; provided, that the
Company will not be liable to the Underwriter for any losses, claims, damages or
liabilities that are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to the Underwriter
furnished to the Company in writing by the Underwriter expressly for use
therein; provided, further, that the Company will not be liable to the
Underwriter with respect to any preliminary prospectus or the Prospectus to the
extent that any such loss, liability, claim, damage or expense resulted from the
fact that the Underwriter, in contravention of a requirement of this Agreement
or applicable law, arranged sales of Shares to a person to whom the Underwriter
failed to send or give, at or prior to the Closing Time or Date of Delivery, as
applicable, a copy of the Prospectus, as then amended or supplemented if: (i)
the Company has previously furnished copies thereof (sufficiently in advance of
the Closing Time or Date of Delivery, as applicable, to allow for distribution
by such time) to the Underwriter and the loss, liability, claim, damage or
expense of the Underwriter resulted from an untrue statement or omission of a
material fact contained in or omitted from the preliminary Prospectus which was
corrected in the Prospectus as, if applicable, amended or supplemented prior to
the Closing Time or Date of Delivery, as applicable, and (ii) such failure to
give or send such Prospectus by the Closing Time or Date of Delivery, as
applicable, to the party or parties asserting such loss,
15
liability, claim, damage or expense would have constituted a
defense to the claim asserted by such person.
(b) The Underwriter agrees to indemnify and hold harmless the
Company, the directors of the Company, the officers of the Company who
sign the Registration Statement and each person, if any, who controls the
Company within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act from and against any and all losses,
claims, damages and liabilities (including, without limitation, any legal
or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any amendment thereof, any preliminary prospectus or the
Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto), or caused by 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 in light of the circumstances under which they were made, but
only with reference to information relating to the Underwriter furnished
to the Company in writing by the Underwriter expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Subsection 7(a) or 7(b), such
person (the "indemnified party") shall promptly notify the person against
whom such indemnity may be sought (the "indemnifying party") in writing
and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the
reasonable fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the
indemnified party shall have specifically and mutually agreed in writing
to the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and the indemnified party
shall have been advised by counsel that representation of both parties by
the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood, however, that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses
of more than one separate firm (in addition to any local counsel) for (i)
the Underwriter and all persons, if any, who control the Underwriter
within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act, and (ii) the Company, its directors, its officers
who sign the Registration Statement and each person, if any, who controls
the Company within the meaning of either such Section. In the case of any
such separate firm for the Underwriter and such control persons of the
Underwriter, such firm shall be designated in writing by the Underwriter.
In the case of any such separate firm for the Company, and such
directors, officers and control persons of the Company, such firm shall
be designated in writing by
16
the Company. The indemnifying party 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 from and against any loss or liability 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 reasonable fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of
any proceeding effected without its written consent if (i) such
settlement is entered into more than 60 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying
party shall have received notice of the terms of such settlement at least
30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement;
provided, that an indemnifying party shall not be liable for any such
settlement effected without its consent if such indemnifying party, prior
to the date of such settlement, (A) reimburses such indemnified party in
accordance with such request for the amount of such fees and expenses of
counsel as the indemnifying party believes in good faith to be
reasonable, and (B) provides written notice to the indemnified party that
the indemnifying party disputes in good faith the reasonableness of the
unpaid balance of such fees and expenses. No indemnifying party shall,
without the prior written consent of the indemnified party, which consent
shall not be unreasonably withheld, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that are
the subject matter of such proceeding.
Section 8. Contribution. (a) To the extent that indemnification
provided for in Subsection 7(a) or 7(b) of this Agreement is unavailable to an
indemnified party or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under such
paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party or parties on the
other hand from the offering of the Shares 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 indemnifying party or parties on
the one hand and of the indemnified party or parties on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriter on the other with respect to such Offering shall be deemed
to be in the same proportion as the total net proceeds from the Offering
(before deducting expenses) received by the Company bears to the total
compensation received by the Underwriter with respect to the Shares sold
pursuant to this Agreement. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand
or the Underwriter on the other, the intent
17
of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission.
(b) The Underwriter agrees that it would not be just or equitable if
contribution pursuant to Section 7 of this Agreement were determined by pro
rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in Subsection 8(a). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8, the Underwriter
shall not be required to contribute any amount in excess of the amount by
which the total price at which the Shares were offered to the public exceeds
the amount of any damages that the Underwriter has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
The indemnity and contribution provisions contained in Section 7 and
8 of this Agreement and the representations, warranties and other statements
of the Company contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of the Underwriter or any person
controlling the Underwriter, or the Company, its officers or directors or any
person controlling the Company and (iii) acceptance of and payment for any of
the Shares.
Section 9. .Representations, Warranties and Agreements to Survive
Delivery. The representations, warranties, indemnities, agreements and other
statements of the Company or its officers set forth in or made pursuant to
this Agreement will remain operative and in full force and effect regardless
of any investigation made by or on behalf of the Company, the Underwriter, or
any person who controls the Company or the Underwriter within the meaning of
Section 15 of the Securities Act and will survive delivery of and payment for
the Shares.
Section 10. Termination of Agreement. (a) The Underwriter may
terminate this Agreement, by notice to the Company, at any time at or prior to
the Closing Time, (i) if there has been, since the respective dates as of
which information is given in the Prospectus, any Material Adverse Change, or
(ii) if there has occurred any material adverse change in the financial
markets or any outbreak of hostilities or escalation thereof or other calamity
or crisis the effect of which on the financial markets is such as to make it,
in the Underwriter's reasonable judgment, impracticable to market the Shares,
or (iii) if trading in any shares of the Company has been suspended by the
Commission or the Nasdaq National Market for more than two consecutive
business days, or if trading generally on the New York Stock Exchange or the
Nasdaq National Market or in the over the counter market has been suspended,
or minimum or maximum prices for trading have been fixed, or maximum ranges
for prices for shares have been required, by such
18
exchange or by order of the Commission, the NASD, or any other governmental
authority or (iv) if a banking moratorium has been declared by either
federal, California or New York authorities.
(b) If this Agreement is terminated pursuant to this Section 10, such
termination shall be without liability of any party to any other party, except
to the extent provided in Section 4. Notwithstanding any such termination, the
provisions of Sections 7, 8 and 9 shall remain in effect.
(c) This Agreement may also terminate pursuant to the provisions of
Section 2, with the effect stated in such Section.
Section 11. Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at
the facsimile telephone number specified in this Section prior to 6:30 p.m.
(New York City time) on a business day, (ii) the business day after the date
of transmission, if such notice or communication is delivered via facsimile at
the facsimile telephone number specified in this Agreement later than 6:30
p.m., New York City time) on any date and earlier than 11:59 p.m. (New York
city time) on such date, (iii) the business day following the date of mailing,
if sent by nationally recognized overnight courier service, or (iv) upon
actual receipt by the party to whom such notice is required to be given. The
address for such notices and communications shall be as follows:
If to the Company: Genelabs Technologies, Inc.
000 Xxxxxxxxx Xxxxx
Xxxxxxx Xxxx, XX 00000
Attn: Chief Financial Officer
Fax No.: (000) 000-0000
With a copy to: Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx, Esq.
Fax No.: (000) 000-0000
If to the Underwriter: Natexis Bleichroeder Inc.
1345 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Legal Department
Fax No.: (000) 000-0000
With a copy to: Shearman & Sterling LLP
0000 Xxxxx Xxxx
Xxxxx Xxxx, XX 00000-0000
Attn: Xxxxx Xxxxxxx, Esq.
Fax No.: (000) 000-0000
19
Section 12. Parties. This Agreement is made solely for the benefit of
the Underwriter, the Company and, to the extent expressed, any person who
controls the Company or the Underwriter within the meaning of Section 15 of
the Securities Act, and the directors of the Company, its officers who have
signed the Registration Statement, and their respective executors,
administrators, successors and assigns and, subject to the provisions of
Section 12, no other person shall acquire or have any right under or by virtue
of this Agreement. The term "successors and assigns" shall not include any
Purchaser.
Section 13. Governing Law. This Agreement shall be governed by the
laws of the State of New York applicable to agreements made and to be
performed entirely within such state.
Section 14. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would
have executed the remaining term, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid, illegal,
void or unenforceable.
Section 15. Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
Section 16. Counterparts. This Agreement may be executed in one or
more counterparts and, when a counterpart has been executed by each party, all
such counterparts taken together shall constitute one and the same agreement.
Section 17. Entire Agreement. This Agreement constitutes the entire
agreement among the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements between the parties, including the Agency
Agreement dated as of September 30, 2003 among the parties hereto, which is
hereby terminated without liability to either party.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement among the Company and the
Underwriter in accordance with its terms.
Very truly yours,
GENELABS TECHNOLOGIES, INC.
By: ______________________________
Name: Xxxxx X. Xxxx, Ph.D.
Title: Chairman and Chief
Executive Officer
Confirmed and accepted as of
the date first above written:
NATEXIS BLEICHROEDER INC.
By: __________________________
Name:
Title:
