Shares1 ASTHMATX, INC. Common Stock PURCHASE AGREEMENT
Exhibit 1.1
Shares1
ASTHMATX, INC.
Common Stock
, 2006
XXXXX XXXXXXX & CO.
BEAR, XXXXXXX & CO. INC.
FIRST ALBANY CAPITAL INC.
XXXXXXXXX & COMPANY, INC.
As Representatives of the several
Underwriters named in Schedule I hereto
BEAR, XXXXXXX & CO. INC.
FIRST ALBANY CAPITAL INC.
XXXXXXXXX & COMPANY, INC.
As Representatives of the several
Underwriters named in Schedule I hereto
c/o Xxxxx Xxxxxxx & Co.
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
c/o Bear Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Asthmatx, Inc., a Delaware corporation (the “Company”) proposes to sell to the several
Underwriters named in Schedule I hereto (the “Underwriters”) an aggregate of [ ] shares (the “Firm Shares”) of Common Stock, $0.00001 par value per share (the “Common
Stock”), of the Company. The Company has also granted to the several Underwriters an option to
purchase up to [ ] additional shares of Common Stock on the terms and for the purposes set
forth in Section 3 hereof (the “Option Shares”). The Firm Shares and any Option Shares purchased
pursuant to this Purchase Agreement are herein collectively called the “Securities.” Xxxxx Xxxxxxx
& Co. and Bear, Xxxxxxx & Co. Inc. are acting as lead managers (the “Lead Managers”) in connection
with the offering and sale of the Securities contemplated herein.
The Company hereby confirms its agreement with respect to the sale of the Securities to the
several Underwriters, for whom you are acting as representatives (the “Representatives”).
| 1 | Plus an option to purchase up to [ ] additional shares to cover over-allotments. |
1. Registration Statement and Prospectus. A registration statement on Form S-1 (File No.
333-135997) with respect to the Securities, including a preliminary form of prospectus, has been
prepared by the Company in conformity with the requirements of the Securities Act of 1933, as
amended (the “Act”), and the rules and regulations (“Rules and Regulations”) of the Securities and
Exchange Commission (the “Commission”) thereunder and has been filed with the Commission; one or
more amendments to such registration statement have also been so prepared and have been, or will
be, so filed; and, if the Company has elected to rely upon Rule 462(b) of the Rules and Regulations
(“Rule 462(b)”) to increase the size of the offering registered under the Act, the Company will
prepare and file with the Commission a registration statement with respect to such increase
pursuant to Rule 462(b). Copies of such registration statement(s) and amendments and each related
preliminary prospectus have been delivered to you.
If the Company has elected not to rely upon Rule 430A of the Rules and Regulations (“Rule
430A”), the Company has prepared and will promptly file an amendment to the registration statement
and an amended prospectus. If the Company has elected to rely upon Rule 430A, it will prepare and
file a prospectus pursuant to Rule 424(b) of the Rules and Regulations (“Rule 424(b)”) that
discloses the information previously omitted from the prospectus in reliance upon Rule 430A. Each
part of such registration statement as amended at the time it is or was declared effective by the
Commission, and, in the event of any amendment thereto after the effective date, each part of such
registration statement as so amended (but only from and after the effectiveness of such amendment,
or the date it is first used after effectiveness of the registration statement, in the case of
information contained in a form of prospectus filed with the Commission pursuant to Rule 424(b) and
deemed to be part of the registration statement pursuant to Rule 430C of the Rules and Regulations
(“Rule 430C”)), including a registration statement (if any) filed pursuant to Rule 462(b)
increasing the size of the offering registered under the Act, information (if any) deemed to be
part of the registration statement at the time of effectiveness pursuant to Rule 430A(b) and
information (if any) contained in a form of prospectus required to be filed with the Commission
pursuant to Rule 424(b) and deemed to be part of and included in the registration statement on the
date it is first used after effectiveness in accordance with Rule 430C, is hereinafter called the
“Registration Statement.” The prospectus included in the Registration Statement at the time it is
or was declared effective by the Commission is hereinafter called the “Prospectus,” except that if
any prospectus filed by the Company with the Commission pursuant to Rule 424(b) or any other such
prospectus provided to the Underwriters by the Company for use in connection with the offering of
the Securities (whether or not required to be filed by the Company with the Commission pursuant to
Rule 424(b), but not including a “free writing prospectus” as defined in Rule 405 of the Rules and
Regulations (“Rule 405”)) differs from the prospectus on file at the time the Registration
Statement is or was declared effective by the Commission, the term “Prospectus” shall refer to such
differing prospectus from and after the time such prospectus is filed with the Commission or
transmitted to the Commission for filing pursuant to such Rule 424(b) or from and after the time of
its first use within the meaning of the Rules and Regulations. The term “Preliminary Prospectus”
as used herein means any preliminary prospectus included in the Registration Statement prior to the
time it becomes or became
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effective under the Act and any prospectus subject to completion as
described in Rule 430A. All references in this Agreement to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any amendment or supplement to any of the foregoing,
shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval System (“XXXXX”).
2. Representations and Warranties of the Company.
(a) The Company represents and warrants to, and agrees with, the several Underwriters as
follows:
(i) No order preventing or suspending the use of any Preliminary Prospectus or any
Issuer Free Writing Prospectus (as defined below) has been issued by the Commission and each
Preliminary Prospectus, at the time of filing thereof or the time of first use within the
meaning of the Rules and Regulations, complied in all material respects with the
requirements of the Securities Act and the Rules and Regulations and did 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, in the light of the circumstances under
which they were made, not misleading; except that the foregoing shall not apply to
statements in or omissions from any Preliminary Prospectus or any Issuer Free Writing
Prospectus in reliance upon, and in conformity with, written information furnished to the
Company by you, or by any Underwriter through you, specifically for use in the preparation
thereof.
(ii) As of the time any part of the Registration Statement (or any post-effective
amendment thereto, including a registration statement (if any) filed pursuant to Rule 462(b)
increasing the size of the offering registered under the Act) became effective, upon the
filing or first use within the meaning of the Rules and Regulations of the Prospectus (or
any supplement to the Prospectus) and at the First Closing Date and Second Closing Date (as
hereinafter defined), (A) the Registration Statement and the Prospectus (in each case, as so
amended and/or supplemented) conformed or will conform in all material respects to the
requirements of the Act and the Rules and Regulations, (B) the Registration Statement (as so
amended) did not or will not include an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the statements therein
not misleading, and (C) the Prospectus (as so supplemented) did not or will not include an
untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the circumstances in which
they are or were made, not misleading; except that the foregoing shall not apply to
statements in or omissions from any such document in reliance upon, and in conformity with,
written information furnished to the Company by you, or by any Underwriter through you,
specifically for use in the preparation thereof. If the Registration Statement has been
declared effective by the Commission, no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceeding for that purpose has been
initiated or, to the Company’s knowledge, threatened by the Commission.
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(iii) Neither (A) the Issuer General Free Writing Prospectus(es) issued at or prior to
the Time of Sale and the Statutory Prospectus at the Time of Sale, all considered together
(collectively, the “Time of Sale Disclosure Package”), nor (B) any individual Issuer
Limited-Use Free Writing Prospectus, when considered together with the Time of Sale
Disclosure Package, includes or included as of the Time of Sale any untrue statement of a
material fact or omit or omitted as of the Time of Sale to state any material fact necessary
in order to make the statements therein, in the light of the circumstances under which they
were made, not misleading. The preceding sentence does not apply to statements in or
omissions from any Statutory Prospectus or any Issuer Free Writing Prospectus based upon and
in conformity with written information furnished to the Company by you or by any Underwriter
through you specifically for use therein. As used in this paragraph and elsewhere in this
Agreement:
(1) “Time of Sale” means [___]:00 [a.m./p.m] (Eastern time) on the date of
this Agreement
(2) “Statutory Prospectus” as of any time means the prospectus that is included
in the Registration Statement immediately prior to that time. For purposes of this
definition, information contained in a form of prospectus that is deemed
retroactively to be a part of the Registration Statement pursuant to Rule 430A shall
be considered to be included in the Statutory Prospectus as of the actual time that
form of prospectus is filed with the Commission pursuant to Rule 424(b).
(3) “Issuer Free Writing Prospectus” means any “issuer free writing
prospectus,” as defined in Rule 433 of the Rules and Regulations (“Rule 433”),
relating to the Securities that (A) is required to be filed with the Commission by
the Company, or (B) is exempt from filing pursuant to Rule 433(d)(5)(i) because it
contains a description of the Securities or of the offering that does not reflect
the final terms or pursuant to Rule 433(d)(8)(ii) because it is a “bona fide
electronic road show,” as defined in Rule 433 which is made available without
restriction, in each case in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the Company’s
records pursuant to Rule 433(g).
(4) “Issuer General Free Writing Prospectus” means any Issuer Free Writing
Prospectus that is intended for general distribution to prospective investors, as
evidenced by its being specified in Schedule II to this Agreement.
(5) “Issuer Limited-Use Free Writing Prospectus” means any Issuer Free Writing
Prospectus that is not an Issuer General Free Writing Prospectus. The term Issuer
Limited-Use Free Writing Prospectus also includes any “bona fide electronic road
show,” as defined in Rule 433, that is made available without
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restriction pursuant
to Rule 433(d)(8)(ii), even though it is not required to be filed with the
Commission.
(iv) (A) Each Issuer Free Writing Prospectus, as of its issue date and at all
subsequent times through the completion of the public offer and sale of the Securities or
until any earlier date that the Company notified or notifies the Representatives as
described in Section 4(a)(iii)(B), did not, does not and will not include any information
that conflicted, conflicts or will conflict with the information contained in the
Registration Statement, any Statutory Prospectus or the Prospectus. The foregoing sentence
does not apply to statements in or omissions from any Issuer Free Writing Prospectus based
upon and in conformity with written information furnished to the Company by you or by any
Underwriter through you specifically for use therein.
(B) (1) At the time of filing the Registration Statement and (2) at the date hereof,
the Company was not and is not an “ineligible issuer,” as defined in Rule 405, including the
Company in the preceding three years not having been convicted of a felony or misdemeanor or
having been made the subject of a judicial or administrative decree or order as described in
Rule 405 (without taking account of any determination by the Commission pursuant to Rule 405
that it is not necessary that the Company be considered an ineligible issuer), nor an
“excluded issuer” as defined in Rule 164 of the Rules and Regulations (“Rule 164”).
(C) Each Issuer Free Writing Prospectus satisfied, as of its issue date and at all
subsequent times through the completion of the public offer and sale of the Securities, all
other conditions to use thereof as set forth in Rules 164 and 433 under the Act.
(v) The financial statements and pro forma financial data of the Company, together with
the related notes, set forth in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus comply in all material respects with the requirements of the Act
and fairly present the financial condition of the Company as of the dates indicated and the
results of operations and changes in cash flows for the periods therein specified in
conformity with generally accepted accounting principles in the United States consistently
applied throughout the periods involved; and the supporting schedules and pro forma as
adjusted financial data included in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus have been derived from the accounting records of the Company and
present fairly the information stated therein. No other financial statements or schedules
are required to be included in the Registration Statement, the Time of Sale Disclosure
Package or the Prospectus. To the Company’s knowledge, PricewaterhouseCoopers LLP, which
has expressed its opinion with respect to the financial statements and schedules filed as a
part of the Registration Statement and included in the Registration Statement, the Time of
Sale Disclosure Package and the Prospectus, is (X) an independent public accounting firm
within the meaning of the Act and the Rules and Regulations, (Y) a registered public
accounting firm (as defined in Section 2(a)(12) of the Xxxxxxxx-Xxxxx Act of
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2002 (the “Xxxxxxxx-Xxxxx Act”)) and (Z) in the performance of their work for the Company, not in
violation of the auditor independence requirements of the Xxxxxxxx-Xxxxx Act. Except as
disclosed in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus, there are no material off-balance sheet transactions, arrangements, obligations
(including contingent obligations), or any other relationships with unconsolidated entities
or other persons, that could reasonably be expected to have a material current or, to the
Company’s knowledge, future effect on the Company’s financial condition, results of
operations, liquidity, capital expenditures, capital resources or significant components of
revenue or expenses. The other financial information (and any statistical information
derived therefrom) included in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus present fairly the information included therein and have been
prepared on a basis consistent with that of the financial statements that are included in
the Registration Statement, the Time of Sale Disclosure Package and the Prospectus and the
books and records of the respective entities presented therein.
(vi) The Company has been duly organized and is validly existing as a corporation in
good standing under the laws of the state of Delaware. The Company has full corporate power
and authority to own its properties and conduct its business as currently being carried on
and as described in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus, and is duly qualified to do business as a foreign corporation in good standing
in each jurisdiction in which it owns or leases real property or in which the conduct of its
business makes such qualification necessary and in which the failure to so qualify would
have a material adverse effect upon, or change in, (A) the general affairs, business,
prospects, properties, operations, condition (financial or otherwise) or results of
operations of the Company or (B) the ability of the Company to consummate the transactions
contemplated herein or by the Time of Sale Disclosure Package (“Material Adverse Effect” or
“Material Adverse Change”).
(vii) The Company does not, directly or indirectly, own or control any capital stock or
other equity ownership or proprietary interest in any corporation, partnership, association,
trust or other entity. The Company is not a participant in any joint venture, partnership
or similar arrangement.
(viii) Except as contemplated in the Time of Sale Disclosure Package and in the
Prospectus, subsequent to the respective dates as of which information is given in the Time
of Sale Disclosure Package and the Prospectus, the Company has not incurred any material
liabilities or obligations, direct or contingent, or entered into any material transactions,
including any acquisition or disposition of any business or asset, or declared or paid any
dividends or made any distribution of any kind with respect to its capital stock; there has
not been any change in the capital stock (other than a change in the
number of outstanding shares of Common Stock due to the issuance of shares upon the exercise of outstanding
options or warrants), or any material change in the short-term or long-term debt, or any
issuance of options, warrants, convertible securities or other rights to purchase the
capital stock (other than grants of options under the Company’s
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stock option plans existing
on the date hereof), of the Company or any Material Adverse Change or any development that
could reasonably be expected to result in a Material Adverse Change; and the Company has not
sustained any material loss or interference with its business or properties from fire,
explosion, flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental proceeding.
(ix) Except as set forth in the Time of Sale Disclosure Package and in the Prospectus,
there is not pending or, to the knowledge of the Company, threatened or contemplated, any
material action, suit or proceeding to which the Company is a party or of which any property
or assets of the Company is the subject before or by any court or Governmental Authority (as
defined below), or any arbitrator, and the defense of all such proceedings, litigation and
arbitration against or involving the Company could not reasonably be expected to have a
Material Adverse Effect. There are no current or pending legal, governmental or regulatory
actions, suits or proceedings to which the Company is a party of which any property or
assets of the Company is subject that are required to be described in the Registration
Statement, Time of Sale Disclosure Package and Prospectus by the Act or by the Rules and
Regulations that have not been so described.
(x) There are no statutes, regulations, contracts or documents that are required to be
described in the Registration Statement, in the Time of Sale Disclosure Package and in the
Prospectus or be filed as exhibits to the Registration Statement by the Act or by the Rules
and Regulations that have not been so described or filed.
(xi) This Agreement has been duly authorized, executed and delivered by the Company,
and constitutes a valid, legal and binding obligation of the Company, enforceable in
accordance with its terms, except as rights to indemnity hereunder may be limited by federal
or state securities laws and except as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting the rights of creditors generally and
subject to general principles of equity. The execution, delivery and performance of this
Agreement and the consummation of the transactions herein contemplated will not (A) conflict
with or result in a breach or violation 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 pursuant to any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company is a party or by
which the Company is bound or to which any of the property or assets of the Company is
subject, (B) result in any violation of the provisions of the certificate of incorporation,
bylaws or other organizational documents of the Company or (C) result in the violation of
any law or statute or any judgment, order, rule, regulation or decree of any court or
arbitrator or federal, state, local or foreign governmental agency or regulatory authority
having jurisdiction over the properties or assets of the Company (each, a “Governmental
Authority”). No consent, approval, authorization or order of, or filing with, any court or
Governmental Authority is required for the execution, delivery and performance of this
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Agreement or for the consummation of the transactions contemplated hereby, including the
issuance or sale of the Securities by the Company, except such as may be required under the
Act or state or foreign securities or blue sky laws; and the Company has full power and
authority to enter into this Agreement and to consummate the transactions contemplated
hereby, including the authorization, issuance and sale of the Securities as contemplated by
this Agreement.
(xii) All of the issued and outstanding shares of capital stock of the Company,
including the outstanding shares of Common Stock, are duly authorized and validly issued,
fully paid and nonassessable, have been issued in compliance with all federal, state and
foreign securities laws, were not issued in violation of or subject to any preemptive rights
or other rights to subscribe for or purchase securities that have not been waived in writing
(a copy of which has been delivered to counsel to the Representatives); the Securities which
may be sold hereunder by the Company have been duly authorized and, when issued, delivered
and paid for in accordance with the terms of this Agreement, will have been validly issued
and will be fully paid and nonassessable, and will have been issued in compliance with all
applicable federal, state and foreign securities laws; and the capital stock of the Company,
including the Common Stock, conforms to the description thereof in the Registration
Statement, in the Time of Sale Disclosure Package and in the Prospectus. Except as
otherwise stated in the Registration Statement, in the Time of Sale Disclosure Package and
in the Prospectus, there are no preemptive rights or other rights to subscribe for or to
purchase, or any restriction upon the voting or transfer of, any shares of Common Stock
pursuant to the Company’s certificate of incorporation, bylaws or any agreement or other
instrument to which the Company is a party or by which the Company is bound. Neither the
filing of the Registration Statement nor the offering or sale of the Securities as
contemplated by this Agreement gives rise to any rights for or relating to the registration
of any shares of Common Stock or other securities of the Company that have not been duly
waived. Except as described in the Registration Statement, in the Time of Sale Disclosure
Package and in the Prospectus, there are no options, warrants, agreements, contracts or
other rights in existence to purchase or acquire from the Company any shares of the capital
stock of the Company. The Company has an authorized and outstanding capitalization as set
forth in the Registration Statement, in the Time of Sale Disclosure Package and in the
Prospectus.
(xiii) The Company possesses all requisite power and authority, and possesses or has
sufficient rights with respect to all licenses, consents, certificates, permits and other
authorizations issued by, and have made all declarations and filings with, the appropriate
Governmental Authorities that are necessary for the ownership, lease or operation of their
properties or the conduct of its business as now being conducted and as described in the
Registration Statement, the Time of Sale Disclosure Package and the Prospectus; the Company
has not received notice of any revocation or modification of any such license, consent,
certificate, permit or authorization and has no reason to believe that any such license,
consent, certificate, permit or authorization will not be renewed in the ordinary course;
and the Company is in compliance in all material
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respects with all applicable federal,
state, local and foreign laws, regulations, orders and decrees.
(xiv) The Company owns or leases all such real properties as are necessary to the
conduct of its business as presently operated as described in the Time of Sale Disclosure
Package and the Prospectus. The Company has good and marketable title to all tangible
property (whether real or personal) described in the Registration Statement, in the Time of
Sale Disclosure Package and in the Prospectus as being owned by it, in each case free and
clear of all liens, claims, security interests, other encumbrances or defects except such as
are described in the Registration Statement, in the Time of Sale Disclosure Package and in
the Prospectus. The property held under lease by the Company is held by it under valid,
subsisting and enforceable leases with only such exceptions with respect to any particular
lease as do not interfere in any material respect with the conduct of the business of the
Company. The Company has not received any notice of any claim adverse to its ownership of
any real or personal property or of any claim against the continued possession of any real
property, whether owned or held under lease or sublease of the Company.
(xv) The Company owns, possesses or can acquire on reasonable terms all Intellectual
Property (as defined below) necessary for the conduct of the business of the Company as
described in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus as now conducted and for the marketing and sale of the Alair System. Except as
disclosed in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus under the caption [“Business-Patents and Proprietary Rights,”] (A) to the
Company’s knowledge, there is no infringement, misappropriation or violation by third
parties of any such Intellectual Property; (B) there is no pending or, to the knowledge of
the Company, threatened action, suit, proceeding or claim by others challenging the rights
of the Company in or to any such Intellectual Property, and the Company is unaware of any
facts which would form a reasonable basis for any such claim; (C) the Intellectual Property
owned by the Company and, to the knowledge of the Company, the Intellectual Property
licensed to the Company has not been adjudged invalid or unenforceable, in whole or in part,
and there is no pending or, to the knowledge of the Company, threatened action, suit,
proceeding or claim by others challenging the validity or scope of any such Intellectual
Property, and the Company is unaware of any facts which would form a reasonable basis for
any such claim; (D) there is no pending or, to the knowledge of the Company, threatened
action, suit, proceeding or claim by others that the Company infringes, misappropriates or
otherwise violates any Intellectual Property rights of others, the Company has not received
any written notice of such claim and the Company is unaware of any other facts which would
form a reasonable basis for any such claim; and (E) to the Company’s knowledge, no employee
of the Company is in or has ever been in violation of any material term of any employment
contract, patent disclosure agreement, invention assignment agreement, non-competition
agreement, non-solicitation agreement, nondisclosure agreement or any restrictive covenant
to or with a former employer where the basis of such violation relates to such employee’s
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employment with the Company, or actions undertaken by the employee while employed with the
Company. The Company has taken reasonable measures to protect the confidentiality of all
material technical information developed by and belonging to the Company which has not been
patented. The term “Intellectual Property” as used herein means all patents, patent
applications, trade and service marks, trade and service xxxx registrations, trade names,
copyrights, licenses, inventions, trade secrets, technology, know-how and other intellectual
property.
(xvi) The Company is not (A) in violation of its certificate of incorporation or
bylaws; (B) in breach of or otherwise in default, and no event has occurred which, with
notice or lapse of time or both, would constitute such a default in the performance or
observance of any term, covenant, obligation, agreement or condition contained in any bond,
debenture, note, indenture, loan agreement, mortgage, deed of trust or any other contract,
lease or other instrument to which it is subject or by which it may be bound, or to which
any of the material property or assets of the Company is subject or (C) in violation of any
law or statute or any order, rule, regulation, judgment or decree of any court or arbitrator
or Governmental Authority.
(xvii) The Company has accurately prepared and timely filed all federal, state, local
and foreign income, franchise and other tax returns required to be filed and are not in
default in the payment of any taxes which were payable pursuant to said returns or any
assessments with respect thereto, other than any which the Company is contesting in good
faith, including without limitation, all sales and use taxes and all taxes which the Company
is obligated to withhold from amounts owing to employees, creditors and third parties, with
respect to the periods covered by such tax returns (whether or not such amounts are shown as
due on any tax return). There is no pending dispute with any taxing authority relating to
any of such returns and the Company has no knowledge of any proposed liability for any tax
to be imposed upon the properties or assets of the Company for which there is not an
adequate reserve reflected in the Company’s financial statements included in the
Registration Statement, the Time of Sale Disclosure Package and the Prospectus, and since
December 31, 2005, the Company has not incurred any liability for taxes other than in the
ordinary course of business. There is no tax lien, whether imposed by any federal, state,
foreign or other taxing authority, outstanding against the assets, properties or business of
the Company.
(xviii) The Company has not distributed and will not distribute any prospectus or other
offering material in connection with the offering and sale of the Securities other than any
Preliminary Prospectus, the Time of Sale Disclosure Package or the Prospectus or other
materials permitted by the Act to be distributed by the Company; provided, however, that,
except as set forth on Schedule II, the Company has not made and will not make any offer
relating to the Securities that would constitute a “free writing prospectus” as defined in
Rule 405, except in accordance with the provisions of Section 4(a)(xix) of this Agreement.
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(xix) The Securities have been approved for listing on the Nasdaq Global Market upon
official notice of issuance and, on the date the Registration Statement became or becomes
effective, the Company’s Registration Statement on Form 8-A or other applicable form under
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), became or will become
effective.
(xx) The Company maintains a system of internal accounting controls sufficient to
provide reasonable assurances that (A) transactions are executed in accordance with
management’s general or specific authorization; (B) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally accepted
accounting principles in the United States and to maintain accountability for assets; (C)
access to assets is permitted only in accordance with management’s general or specific
authorization; and (D) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect to any
differences. The Company maintains a system of internal control over financial reporting
(as such term is defined in Rule 13a-15(f) under the Exchange Act) that complies with the
requirements of the Exchange Act and has been designed by the Company’s principal executive
officer and principal financial officer, or under their supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles
in the United States. Except as disclosed in the Registration Statement, in the Time of
Sale Disclosure Package and in the Prospectus, the Company’s internal control over financial
reporting is effective to provide reasonable assurance regarding the reliability of
financial reporting and the Company is not aware of any material weaknesses in its internal
control over financial reporting, and since December 31, 2005, there has been no adverse
change in the Company’s internal control over financial reporting (whether or not
remediated) that has materially affected, or is reasonably likely to materially affect, the
Company’s internal control over financial reporting.
(xxi) The Company’s board of directors has validly appointed an audit committee whose
composition satisfies the applicable requirements of Rule 4350(d)(2) of the Rules (the “NASD
Rules”) of the National Association of Securities Dealers, Inc. (the “NASD”) and the
Company’s board of directors and/or the audit committee has adopted a charter that satisfies
the requirements of Rule 4350(d)(1) of the NASD Rules. Neither the Company’s board of
directors nor the audit committee has been informed of (A) any significant deficiencies in
the design or operation of the Company’s internal controls which could adversely affect the
Company’s ability to record, process, summarize and report financial data or any material
weakness in the Company’s internal controls; or (B) any fraud, whether or not material, that
involves management or other employees of the Company who have a significant role in the
Company’s internal controls.
(xxii) No relationship, direct or indirect, exists between or among the Company, on the
one hand, and the directors, officers, stockholders, customers or
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suppliers of the Company,
on the other hand, which is required to be described in the Registration Statement, the Time
of Sale Disclosure Package and the Prospectus which is not so described. The Company has
not, directly or indirectly, extended or maintained credit, or arranged for the extension of
credit, or renewed an extension of credit, in the form of a personal loan to or for any of
their directors or executive officers in violation of applicable laws, including Section 402
of the Xxxxxxxx-Xxxxx Act.
(xxiii) Except as described in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus, the Company: (A) is and at all times has been in compliance with
all statutes, rules, regulations, or guidances applicable to the ownership, testing,
development, manufacture, packaging, processing, use, distribution, marketing, labeling,
promotion, sale, offer for sale, storage, import, export or disposal of any product
manufactured or distributed by the Company (“Applicable Laws”), except as could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Change;
(B) has not received any FDA Form 483, notice of adverse finding, warning letter, untitled
letter or other correspondence or notice from the U.S. Food and Drug Administration or any
other Governmental Authority alleging or asserting noncompliance with any Applicable Laws or
any licenses, certificates, approvals, clearances, authorizations, permits and supplements
or amendments thereto required by any such Applicable Laws (“Authorizations”); (C) possesses
all material Authorizations and such Authorizations are valid and in full force and effect
and are not in material violation of any term of any such Authorizations; (D) has not
received notice of any claim, action, suit, proceeding, hearing, enforcement, investigation,
arbitration or other action from any Governmental Authority or third party alleging that any
product operation or activity is in violation of any Applicable Laws or Authorizations and
have no knowledge that any such Governmental Authority or third party is considering any
such claim, litigation, arbitration, action, suit, investigation or proceeding; (E) has not
received notice that any Governmental Authority has taken, is taking or intends to take
action to limit, suspend, modify or revoke any Authorizations and have no knowledge that any
such Governmental Authority is considering such action; (F) has filed, obtained, maintained
or submitted all reports, documents, forms, notices, applications, records, claims,
submissions and supplements or amendments as required by any Applicable Laws or
Authorizations and that all such reports, documents, forms, notices, applications, records,
claims, submissions and supplements or amendments were complete and correct on the date
filed (or were corrected or supplemented by a subsequent submission); and (G) has not,
either voluntarily or involuntarily, initiated, conducted, or issued or caused to be
initiated, conducted or issued, any recall, market withdrawal or replacement, safety alert,
post sale warning, “dear doctor” letter, or other notice or action relating to the alleged
lack of safety or efficacy of any product or any alleged product defect or violation and, to
the Company’s knowledge, no third party has initiated, conducted or intends to initiate any
such notice or action.
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(xxiv) The studies, tests and preclinical and clinical trials conducted by or on behalf
of the Company were and, if still pending, are being conducted in all material respects in
accordance with experimental protocols, procedures and controls pursuant to accepted
professional scientific standards and all Applicable Laws and Authorizations, including,
without limitation, the Federal Food, Drug and Cosmetic Act and the rules and regulations
promulgated thereunder (collectively, “FFDCA”); the descriptions of the results of such
studies, tests and trials contained in the Registration Statement, the Time of Sale
Disclosure Package and the Prospectus are accurate and complete in all material respects and
fairly present the data derived from such studies, tests and trials; except to the extent
disclosed in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus, the Company is not aware of any studies, tests or trials, the results of which
the Company believes reasonably call into question the study, test, or trial results
described or referred to in the Registration Statement, the Time of Sale Disclosure Package
and the Prospectus when viewed in the context in which such results are described and the
clinical state of development; and the Company has not received any notices or
correspondence from any Governmental Authority requiring the termination, suspension or
material modification of any studies, tests or preclinical or clinical trials conducted by
or on behalf of the Company.
(xxv) The Company (A) is in compliance with any and all applicable federal, state,
local and foreign laws, rules, regulations, decisions and orders relating to the protection
of human health and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants (collectively, “Environmental Laws”); (B) has received and is in
compliance with all permits, licenses or other approvals required of it under applicable
Environmental Laws to conduct its business; and (C) has not received notice of any actual or
potential liability for the investigation or remediation of any disposal or release of
hazardous or toxic substances or wastes, pollutants or contaminants. The Company has not
agreed to assume, undertake or provide indemnification for any liability of any other person
under any Environmental Law, including any obligation for cleanup or remedial action except
pursuant to real estate leases in the ordinary course of business. No property of the
Company is subject to any lien under any Environmental Law. The Company is not subject to
any order, decree, agreement or other individualized legal requirement related to any
Environmental Law.
(xxvi) The Company (A) is in compliance with all applicable federal, state, local and
foreign laws, rules, regulations, treaties, statutes and codes promulgated by any and all
Governmental Authorities (including pursuant to the Occupational Health and Safety Act)
relating to the protection of human health and safety in the workplace (“Occupational
Laws”); (B) has received all material permits, licenses or other approvals required of it
under applicable Occupational Laws to conduct its business as currently conducted; and (C)
is in compliance with all terms and conditions of such permits, licenses or approvals. No
action, proceeding, revocation proceeding, writ, injunction or claim is pending or, to the
Company’s
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knowledge, threatened against the Company relating to Occupational Laws, and the
Company does not have knowledge of any facts, circumstances or developments relating to its
operations or cost accounting practices that could reasonably be expected to form the basis
for or give rise to such actions, suits, investigations or proceedings.
(xxvii) Each employee benefit plan, within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), that is maintained,
administered or contributed to by the Company or any of its affiliates for employees or
former employees of the Company has been maintained in compliance with its terms and the
requirements of any applicable statutes, orders, rules and regulations, including ERISA and
the Internal Revenue Code of 1986, as amended (the “Code”). The Company has not incurred
and does not expect to incur liability under Title IV of ERISA with respect to the
termination of, or withdrawal from any “pension plan;” and each plan for which the Company
would have any liability that is intended to be qualified under Section 401(a) of the Code
is so qualified and nothing has occurred, whether by action or by failure to act, which
could cause the loss of such qualification. No prohibited transaction, within the meaning
of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any such
plan excluding transactions effected pursuant to a statutory or administrative exemption;
and for each such plan that is subject to the funding rules of Section 412 of the Code or
Section 302 of ERISA, no “accumulated funding deficiency” as defined in Section 412 of the
Code has been incurred, whether or not waived, and the fair market value of the assets of
each such plan (excluding for these purposes accrued but unpaid contributions) exceeds the
present value of all benefits accrued under such plan determined using reasonable actuarial
assumptions.
(xxviii) No labor disturbance by the employees of the Company exists or, to the best of
the Company’s knowledge, is imminent and the Company is not aware of any existing or
imminent labor disturbances by the employees of any of its principal suppliers,
manufacturers, customers or contractors.
(xxix) Except as disclosed in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus, the Company has not granted rights to develop, manufacture,
produce, assemble, distribute, license, market or sell its products to any other person and
is not bound by any agreement that affects the exclusive right of the Company to develop,
manufacture, produce, assemble, distribute, license, market or sell its products.
(xxx) The statistical, industry-related and market-related data included in the
Registration Statement, the Time of Sale Disclosure Package and the Prospectus are based on
or derived from sources which the Company reasonably and in good faith believes are reliable
and accurate, and such data agree with the sources from which they are derived.
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(xxxi) Other than as contemplated by this Agreement, the Company has not incurred any
liability for any finder’s or broker’s fee or agent’s commission in connection with the
execution and delivery of this Agreement or the consummation of the transactions
contemplated hereby. Except as disclosed in the Time of Sale Disclosure Package and the
Prospectus, there are no contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder’s fee or other like payment in connection with the transactions
contemplated by this Agreement or, to the Company’s knowledge, any arrangements, agreements,
understandings, payments or issuance with respect to the Company or any of its officers,
directors, stockholders, partners, employees, subsidiaries or affiliates that may affect the
Underwriters’ compensation as determined by the NASD.
(xxxii) Neither the Company nor any of its affiliates is presently doing business with
the government of Cuba or with any person or affiliate located in Cuba.
(xxxiii) The Company carries, or is covered by, insurance issued by insurers of
nationally recognized financial responsibility in such amounts and covering such risks as is
adequate for the conduct of its business and the value of its properties and as is customary
for companies engaged in similar businesses in similar industries; and the Company has not
(A) received notice from any insurer or agent of such insurer that capital improvements or
other expenditures are required or necessary to be made in order to continue such insurance
or (B) any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage at reasonable cost
from similar insurers as may be necessary to continue its business. All such insurance is
outstanding and in full force and effect on the date hereof. There are no material claims
by the Company under any such policy or instrument as to which any insurance company is
denying liability or defending under a reservation of rights clause.
(xxxiv) Neither the Company nor, to the knowledge of the Company, any director,
officer, agent, employee or other person associated with or acting on behalf of the Company
has (A) used any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity; (B) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from corporate funds; (C)
violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977;
or (D) made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment. The operations of the Company are and have been conducted at all times in
compliance with applicable financial record-keeping and reporting requirements of the
Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering
statutes of all applicable jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines issued, administered or enforced by any
governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or
proceeding by or before any court or governmental agency, authority or
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body or any
arbitrator involving the Company with respect to the Money Laundering Laws is pending or, to
the best knowledge of the Company, threatened. The Company and, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the Company is not currently
subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the
U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly use the
proceeds of the offering of the Securities, 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 U.S. sanctions
administered by OFAC.
(xxxv) The Company is not and, after giving effect to the offering and sale of the
Securities, will not be required to register as an “investment company,” as such term is
defined in the Investment Company Act of 1940, as amended, and will not be an entity
“controlled” by an “investment company” within the meaning of such Act.
(xxxvi) The Company and its directors and officers, in their capacities as such, are in
compliance with all applicable provisions of the Xxxxxxxx-Xxxxx Act and the rules and
regulations of the Commission thereunder, including, without limitation, Section 402 related
to loans.
(xxxvii) The Company has established and maintains disclosure controls and procedures
(as defined in Rules 13a-14 and 15d-14 under the Exchange Act) that comply with the
requirements of the Exchange Act; such controls and procedures are effective in ensuring
that material information relating to the Company is made known to the principal executive
officer and the principal financial officer. The Company has utilized such controls and
procedures in preparing and evaluating the disclosures in the Registration Statement, in the
Time of Sale Disclosure Package and in the Prospectus.
(b) Any certificate signed by any officer of the Company and delivered to you or to counsel
for the Underwriters shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
3. Purchase, Sale and Delivery of Securities.
(a) On the basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company agrees to issue and sell the Firm
Shares to the several Underwriters, and each Underwriter agrees, severally and not jointly, to
purchase from the Company the number of Firm Shares set forth opposite the name of such Underwriter
in Schedule I hereto. The purchase price for each Firm Share shall be $[ ] per share. In
making this Agreement, each Underwriter is contracting severally and not jointly; except as
provided in paragraph (c) of this Section 3 and in Section 8 hereof, the agreement of each
Underwriter is to purchase only the respective number of Firm Shares specified in Schedule I.
-16-
The Firm Shares will be delivered by the Company to you for the accounts of the several
Underwriters against payment of the purchase price therefor by wire transfer of same day funds
payable to the order of the Company at the offices of Fenwick & West LLP, 000 Xxxxxxxxxx Xxxxxx,
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000, or such other location as may be mutually acceptable, at 10:00
a.m. Eastern Standard Time on the third (or if the Securities are priced, as contemplated by Rule
15c6-1(c) under the Exchange Act, after 4:30 p.m. Eastern time, the fourth) full business day
following the date hereof, or at such other time and date as you and the Company determine pursuant
to Rule 15c6-1(a) under the Exchange Act, such time and date of delivery being herein referred to
as the “First Closing Date.” If the Representatives so elect, delivery of the Firm Shares may be
made by credit through full fast transfer to the accounts at The Depository Trust Company
designated by the Representatives. Certificates representing the Firm Shares, in definitive form
and in such denominations and registered in such names as you may request upon at least two
business days’ prior notice to the Company, will be made available for checking and packaging not
later than 11:30 a.m., Eastern Standard Time, on the business day next preceding the First Closing
Date at the offices of Fenwick & West LLP, 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000,
or such other location as may be mutually acceptable.
(b) On the basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company hereby grants to the several
Underwriters an option to purchase all or any portion of the Option Shares at the same purchase
price as the Firm Shares, for use solely in covering any over-allotments made by the Underwriters
in the sale and distribution of the Firm Shares. The option granted hereunder may be exercised in
whole or in part at any time (but not more than once) within 30 days after the effective date of
this Agreement upon notice (confirmed in writing) by the Representatives to the Company setting
forth the aggregate number of Option Shares as to which the several Underwriters are exercising the
option, the names and denominations in which the certificates for the Option Shares are to be
registered and the date and time, as determined by you, when the Option Shares are to be delivered,
such time and date being herein referred to as the “Second Closing” and “Second Closing Date”,
respectively; provided, however, that the Second Closing Date shall not be earlier than the First
Closing Date nor earlier than the second business day after the date on which the option shall have
been exercised. If the option is exercised, the number of Option Shares to be purchased by each
Underwriter shall be the same percentage of the total number of Option Shares to be purchased by
the several Underwriters as the number of Firm Shares to be purchased by such Underwriter is of the
total number of Firm Shares to be purchased by the several Underwriters, as adjusted by the
Representatives in such manner as the Representatives deem advisable to avoid fractional shares.
No Option Shares shall be sold and delivered unless the Firm Shares previously have been, or
simultaneously are, sold and delivered.
The Option Shares will be delivered by the Company to you for the accounts of the several
Underwriters against payment of the purchase price therefor by wire transfer of same day funds
payable to the order of the Company at the offices of Fenwick & West LLP, 000 Xxxxxxxxxx Xxxxxx,
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000, or such other location as may be
-17-
mutually acceptable at 10:00
a.m., Eastern Standard Time, on the Second Closing Date. If the Representatives so elect, delivery
of the Option Shares may be made by credit through full fast transfer to the accounts at The
Depository Trust Company designated by the Representatives. Certificates representing the Option
Shares in definitive form and in such denominations and registered in such names as you have set
forth in your notice of option exercise, will be made available for checking and packaging not
later than 11:30 a.m., Eastern Standard Time, on the business day next preceding the Second Closing
Date at the offices of Fenwick & West LLP, 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000,
or such other location as may be mutually acceptable.
(c) It is understood that you, individually and not as Representatives of the several
Underwriters, may (but shall not be obligated to) make payment to the Company, on behalf of any
Underwriter for the Securities to be purchased by such Underwriter. Any such payment by you shall
not relieve any such Underwriter of any of its obligations hereunder. Nothing herein contained
shall constitute any of the Underwriters an unincorporated association or partner with the Company.
4. Covenants.
(a) The Company covenants and agrees with the several Underwriters as follows:
(i) If the Registration Statement has not already been declared effective by the
Commission, the Company will use its best efforts to cause the Registration Statement and
any post-effective amendments thereto to become effective as promptly as possible; the
Company will notify you promptly of (A) the time when the Registration Statement or any
post-effective amendment to the Registration Statement has become effective or any
supplement to the Prospectus has been filed, (B) any request by the Commission for any
amendment or supplement to the Registration Statement or Prospectus or additional
information, (C) the Company’s intention to file, or prepare any supplement or amendment to,
the Registration Statement, any Preliminary Prospectus, the Prospectus or any Issuer Free
Writing Prospectus, (D) the mailing or the delivery to the Commission for filing of any
amendment or supplement to the Registration Statement or the Prospectus, (E) the receipt of
comments from the Commission and (F) the receipt by the Company of any notification with
respect to the suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for that purpose; if the
Company has elected to rely on Rule 430A, the Company will prepare and file a Prospectus
containing the information omitted therefrom pursuant to Rule 430A with the Commission
within the time period required by, and otherwise in accordance with the provisions of,
Rules 424(b) and 430A; if the Company has elected to rely upon Rule 462(b) to increase the
size of the offering registered under the Act, the Company will prepare and file a
registration statement with respect to such increase with the Commission within the time
period required by, and otherwise in accordance with the provisions of, Rule 462(b); the
Company will prepare and file with the Commission, promptly upon your request, any
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amendments or supplements to the Registration Statement or Prospectus that, in your opinion,
may be necessary or advisable in connection with the distribution of the Securities by the
Underwriters; and the Company will furnish the Representatives and counsel for the
Underwriters a copy of any proposed amendment or supplement to the Registration Statement or
Prospectus and will not file any amendment or supplement to the Registration Statement or
Prospectus to which you shall reasonably object by notice to the Company after having been
furnished a copy a reasonable time prior to the filing.
(ii) The Company will advise you, promptly after it shall receive notice or obtain
knowledge thereof, of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement, or any post-effective amendment thereto or
preventing or suspending the use of any Preliminary Prospectus, the Time of Sale Disclosure
Package, the Prospectus or any Issuer Free Writing Prospectus, of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceeding for any such purpose; and the Company will
promptly use its best efforts to prevent the issuance of any stop order or to obtain its
withdrawal if such a stop order should be issued. Additionally, the Company agrees that it
shall comply with the provisions of Rules 424(b) and 430A, as applicable, and will use its
reasonable efforts to confirm that any filings made by the Company under Rule 424(b), Rule
433 or Rule 462 were received in a timely manner by the Commission.
(iii) (A) Within the time during which a prospectus (or in lieu thereof the notice
referred to in Rule 173(a) of the Rules and Regulations) relating to the Securities is
required to be delivered under the Act, the Company will comply as far as it is able with
all requirements imposed upon it by the Act, as now and hereafter amended, and by the Rules
and Regulations, as from time to time in force, so far as necessary to permit the
continuance of sales of or dealings in the Securities as contemplated by the provisions
hereof, the Time of Sale Disclosure Package and the Prospectus. If during such period any
event shall occur or condition shall exist as a result of which the Prospectus (or, if the
Prospectus is not yet available to prospective purchasers, the Time of Sale Disclosure
Package) would include an 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 then
existing, not misleading, or if during such period it is necessary to amend the Registration
Statement or supplement the Prospectus (or, if the Prospectus is not yet available to
prospective purchasers, the Time of Sale Disclosure Package) to comply with the Act, the
Company will promptly notify you and will amend the Registration Statement or supplement the
Prospectus (or, if the Prospectus is not yet available to prospective purchasers, the Time
of Sale Disclosure Package) (at the expense of the Company) so as to correct such statement
or omission or effect such compliance.
(B) If at any time following issuance of an Issuer Free Writing Prospectus, there
occurred or occurs an event or development as a result of which such Issuer Free Writing
Prospectus conflicted or would conflict with the information
-19-
contained in the Registration
Statement, any Statutory Prospectus or the Prospectus relating to the Securities or included
or would include an untrue statement of a material fact or omitted or would omit to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances prevailing at that subsequent time, not misleading, the Company has promptly
notified or promptly will notify the Representatives and has promptly amended or will
promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to
eliminate or correct such conflict, untrue statement or omission.
(iv) The Company shall take or cause to be taken all necessary action to qualify the
Securities for sale under the securities laws of such jurisdictions as you reasonably
designate and to continue such qualifications in effect so long as required for the
distribution of the Securities, except that the Company shall not be required in connection
therewith to qualify as a foreign corporation or to execute a general consent to service of
process in any state.
(v) The Company will furnish to the Underwriters and counsel for the Underwriters
copies of the Registration Statement (up to a total of four of which will be signed and will
include all consents and exhibits filed therewith, as you may request), each Preliminary
Prospectus, the Time of Sale Disclosure Package, the Prospectus, any Issuer Free Writing
Prospectus and all amendments and supplements to such documents, in each case as soon as
available and in such quantities as you may from time to time reasonably request, and will
maintain in the Company’s files manually signed copies of such documents for at least five
years after the date of filing.
(vi) During a period of five years commencing with the date hereof, the Company will
furnish to the Representatives, and to each Underwriter who may so request in writing,
copies of all reports or other communications (financial or other) furnished to security
holders generally or from time to time published or publicly disseminated by the Company,
and will deliver to you (A) as soon as they are available, copies of any reports, financial
statements and proxy or information statements furnished to or filed with the Commission,
the NASD or any national securities exchange on which any class of securities of the Company
is listed; and (B) such additional information concerning the business and financial
condition of the Company as you may from time to time reasonably request (such financial
information to be on a consolidated basis to the extent the accounts of the Company in
reports furnished to its security holders generally or to the Commission), and subject to
provision of such assurances of confidentiality as the Company may reasonably request;
provided that the Company shall not be required by this paragraph to deliver copies of any
reports, communications and statements that are publicly available on XXXXX.
(vii) The Company will make generally available to its security holders as soon as
practicable, but in any event not later than 15 months after the end of the Company’s
current fiscal quarter, an earnings statement (which need not be audited) covering a
12-month period beginning after the effective date of the Registration
-20-
Statement that shall
satisfy the provisions of Section 11(a) of the Act and Rule 158 of the Rules and
Regulations.
(viii) The Company, whether or not the transactions contemplated hereunder are
consummated or this Agreement is prevented from becoming effective under the provisions of
Section 9(a) hereof or is terminated, will pay or cause to be paid (A) all expenses
(including transfer taxes allocated to the respective transferees) incurred in connection
with the delivery to the Underwriters of the Securities, (B) all expenses and fees
(including, without limitation, fees and expenses of the Company’s accountants and counsel
but, except as otherwise provided below, not including fees of the Underwriters’ counsel) in
connection with the preparation, printing, filing, delivery, and shipping of the
Registration Statement (including the financial statements therein and all amendments,
schedules, and exhibits thereto), the Securities, each Preliminary Prospectus, the Time of
Sale Disclosure Package, the Prospectus, any Issuer Free Writing Prospectus and any
amendment thereof or supplement thereto, and the printing, delivery, and shipping of this
Agreement and other underwriting documents, including Blue Sky Memoranda (covering the
states and other applicable jurisdictions), (C) all filing fees and reasonable fees and
disbursements of the Underwriters’ counsel incurred in connection with the qualification of
the Securities for offering and sale by the Underwriters or by dealers under the securities
or blue sky laws of the states and other jurisdictions which you shall designate, (D) the
fees and expenses of any transfer agent or registrar, (E) the filing fees and reasonable
fees and disbursements of the Underwriters’ counsel incident to any required review by the
NASD of the terms of the sale of the Securities, (F) listing fees, if any, (G) the costs and
expenses relating to investor presentations on any “road show” undertaken in connection with
the marketing of the Securities, (H) the cost of preparing stock certificates representing
the Securities and (I) all other costs and expenses incident to the performance of its
obligations hereunder that are not otherwise specifically provided for herein.
Notwithstanding clause (G) above, the parties agree that the Underwriters and the Company
will each be responsible for one half of the cost of chartering any aircraft in connection
with any road show presentation. Except as set forth in the preceding sentence, each
Underwriter shall bear such Underwriter’s costs of travel and lodging in connection with
investor presentations on any road show undertaken in connection with the marketing of the
Securities. If the sale of the Securities provided for herein is not consummated by reason
of action by the Company pursuant to Section 9(a) hereof which prevents this Agreement from
becoming effective, or by reason of any failure, refusal or inability on the part of the
Company to perform any agreement on its part to be performed, or because any other condition
of the Underwriters’ obligations hereunder required to be fulfilled by the Company is not
fulfilled, the Company will reimburse the several Underwriters for all out-of-pocket
disbursements (including fees and disbursements of counsel) incurred by the Underwriters in
connection with their investigation, preparing to market and marketing the Securities or in
contemplation of performing their obligations hereunder. The Company shall not in any event
be liable to any of the Underwriters for loss of anticipated profits from the transactions
covered by this Agreement.
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(ix) The Company will apply the net proceeds from the sale of the Securities to be sold
by it hereunder for the purposes set forth in the Time of Sale Disclosure Package and in the
Prospectus and will file such reports with the Commission with respect to the sale of the
Securities and the application of the proceeds therefrom as may be required in accordance
with Rule 463 of the Rules and Regulations.
(x) The Company will not, without the prior written consent of the Lead Managers, from
the date of execution of this Agreement and continuing to and including the date 180 days
after the date of the Prospectus (the “Lock-Up Period”) offer for sale; sell, contract to
sell, pledge, grant any option for the sale of, enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or otherwise) by the
Company or any affiliate, or otherwise issue or dispose of, directly or indirectly (or
publicly disclose the intention to make any such offer, sale, pledge, grant, issuance or
other disposition), any Common Stock or any securities convertible into or exchangeable for,
or any options or rights to purchase or acquire, Common Stock, except (i) to the
Underwriters pursuant to this Agreement, (ii) pursuant to grants of options or rights under
equity incentive plans disclosed in the Time of Sale Disclosure Package and the Prospectus
or pursuant to the exercise of any such options or rights, (iii) in connection with the
exercise of outstanding warrants described in the Time of Sale Disclosure Package and the
Prospectus or (iv) the grant of warrants to purchase Common Stock in connection with
licensing and other commercial transactions; provided, however,
that the aggregate number of shares issued pursuant to the grants in clause (iv) shall not exceed the lesser of (A) 2% of
the total shares of Common Stock outstanding as of the date hereof (including the shares of
Common Stock being offered hereby) and (B) a number of shares of Common Stock representing
$4,000,000 in value. If (1) during the period that begins on the date that is 18 calendar
days before the last day of the Lock-Up Period and ends on the last day of the Lock-Up
Period, (a) the Company issues an earnings release, (b) the Company publicly announces the
material news or (c) the material event relating to the Company occurs; or (2) prior to the
expiration of the Lock-Up Period, the Company announces that it will release earnings
results during the 16-day period beginning on the last day of the Lock-Up Period, then the
restrictions in this Agreement, unless otherwise waived by the Lead Managers in writing,
shall continue to apply until the expiration of the date that is 18 calendar days after the
date on which (a) the Company issues the earnings release, (b) the Company publicly
announces material news or (c) a material event relating to the Company occurs. The Company
will provide the Representatives, any co-managers and each stockholder subject to the
Lock-Up Agreement (as defined below) with prior written notice of any such announcement that
gives rise to the extension of the Lock-Up Period.
(xi) The Company has caused to be delivered to you prior to the date of this Agreement
a letter, in the form set forth on Exhibit A (the “Lock-Up Agreement”), from each of the
Company’s directors and officers, and from those stockholders who, together with the
directors and officers, hold shares of Common
-22-
Stock representing an aggregate of at least
98% of the total outstanding Common Stock. The Company will enforce the terms of each
Lock-Up Agreement and issue stop-transfer instructions to the transfer agent for the Common
Stock with respect to any transaction or contemplated transaction that would constitute a
breach of or default under the applicable Lock-Up Agreement.
(xii) Neither the Company nor any of its affiliates (within the meaning of Rule 144
under the Act) has taken or will take, directly or indirectly, any action designed to or
which might reasonably be expected to cause or result in, or which has constituted, the
stabilization or manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities, and has not effected any sales of Common Stock which are
required to be disclosed in response to Item 701 of Regulation S-K under the Act which have
not been so disclosed in the Registration Statement.
(xiii) Neither the Company nor any of its affiliates (within the meaning of Rule 144
under the Act) has, prior to the date hereof, made any offer or sale of any securities which
could be “integrated” (within the meaning of the Act and the Rules and Regulations) with the
offer and sale of the Securities pursuant to the Registration Statement.
(xiv) The Company will not incur any liability for any finder’s or broker’s fee or
agent’s commission in connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
(xv) The Company will file with the Commission such periodic and special reports as
required by the Rules and Regulations.
(xvi) The Company will maintain such disclosure controls and other procedures,
including without limitation, those required by Sections 302 and 906 of the Xxxxxxxx-Xxxxx
Act and the applicable regulations thereunder, that are designed to ensure that information
required to be disclosed by the Company in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within the time periods
specified in the Commission’s rules and forms, including without limitation, controls and
procedures designed to ensure that information required to be disclosed by the Company in
the reports that it files or submits under the Exchange Act is accumulated and communicated
to the Company’s management, including its principal executive officer and its principal
financial officer, or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure, to ensure that material information relating to
Company is made known to them by others within those entities.
(xvii) The Company will comply with all effective applicable provisions of the
Xxxxxxxx-Xxxxx Act.
-23-
(xviii) The Company represents and agrees that, unless it obtains the prior written
consent of the Lead Managers, and each Underwriter severally represents and agrees that,
unless it obtains the prior written consent of the Company and the Lead Managers, it has not
made and will not make any offer relating to the Securities that would constitute an “issuer
free writing prospectus,” as defined in Rule 433, or that would otherwise constitute a “free
writing prospectus,” as defined in Rule 405, required to be filed with the Commission;
provided that the prior written consent of the parties hereto shall be deemed to have been
given in respect of the free writing prospectuses included in Schedule II. Any such free
writing prospectus consented to by the Company and the Lead Managers is hereinafter referred
to as a “Permitted Free Writing Prospectus.” The Company represents that it has treated or
agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing
prospectus,” as defined in Rule 433, and has complied and will comply with the requirements
of Rule 433 applicable to any Permitted Free Writing Prospectus, including timely Commission
filing where required, legending and record keeping. The Company represents that it has
satisfied and agrees that it will satisfy the conditions in Rule 433 to avoid a requirement
to file with the Commission any electronic road show.
(xix) The Company’s obligations under the covenants provided for in Sections 4(a)(xv),
4(a)(xvi) and 4(a)(xvii) shall terminate on the one-year anniversary of the date of this
Agreement.
5. Conditions of Underwriters’ Obligations. The obligations of the several Underwriters
hereunder are subject to the accuracy, as of the date hereof and at each of the First Closing Date
and the Second Closing Date (as if made at such Closing Date), of and compliance with all
representations, warranties and agreements of the Company contained herein, to the performance by
the Company of its obligations hereunder and to the following additional conditions:
(a) The Registration Statement shall have become effective not later than 5:00 p.m., Central
time, on the date of this Agreement, or such later time and date as you, as Representatives of the
several Underwriters, shall approve and all filings required by Rules 424, 430A and 433 shall have
been timely made (without reliance on Rule 424(b)(8) or Rule 164(b)); no stop order suspending the
effectiveness of the Registration Statement or any part thereof or any amendment thereof, nor
suspending or preventing the use of the Time of Sale Disclosure Package, the Prospectus or any
Issuer Free Writing Prospectus shall have been issued; no proceedings for the issuance of such an
order shall have been initiated or threatened; and any request of the Commission for additional
information (to be included in the Registration Statement, the Time of Sale Disclosure Package, the
Prospectus, any Issuer Free Writing Prospectus or otherwise) shall have been complied with to your
satisfaction.
(b) No Underwriter shall have advised the Company that (i) the Registration Statement, or any
amendment thereof or supplement thereof contains an untrue statement of a material fact which, in
your reasonable opinion, is material, or omits to state a material fact
-24-
which, in your reasonable
opinion, is required to be stated therein or necessary to make the statements therein not
misleading, or (ii) the Time of Sale Disclosure Package or the Prospectus, or any amendment thereof
or supplement thereto, or any Issuer Free Writing Prospectus contains an untrue statement of fact
which, in your reasonable opinion, is material, or omits to state a fact which, in your reasonable
opinion, is material and is required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made, not misleading.
(c) Except as contemplated in the Time of Sale Disclosure Package and in the Prospectus, the
Company has not (i) since December 31, 2005, sustained any material loss or interference with its
business or properties from fire, explosion, flood, hurricane, accident or other calamity, whether
or not covered by insurance, or from any labor dispute or any legal or governmental proceeding and
(ii) subsequent to the respective dates as of which information is given in the Time of Sale
Disclosure Package, incurred any material liabilities or obligations, direct or contingent, or
entered into any material transactions, or declared or paid any dividends or made any distribution
of any kind with respect to its capital stock; and there shall not have been any change in the
capital stock (other than a change in the number of outstanding shares of Common Stock due to the
issuance of shares upon the exercise of outstanding options or warrants), or any material change in
the short-term or long-term debt of the Company, or any issuance of options, warrants, convertible
securities or other rights to purchase the capital stock of the Company, or any Material Adverse
Change or any development involving a prospective Material Adverse Change (whether or not arising
in the ordinary course of business), that, in your judgment, makes it impractical or inadvisable to
offer or deliver the Securities on the terms and in the manner contemplated in the Time of Sale
Disclosure Package and in the Prospectus.
(d) On or after the Time of Sale (i) no downgrading shall have occurred in the rating accorded
the Company’s debt securities or preferred stock by any “nationally recognized statistical
organization,” as that term is defined by the Commission for purposes of Rule 436(g)(2) under the
Act, and (ii) no such organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company’s debt securities or
preferred stock;
(e) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, the opinion of Fenwick & West LLP, counsel for the Company, dated such
Closing Date and addressed to you, to the effect that:
(i) The Company has been duly organized and is validly existing as a corporation in
good standing under the laws of the State of Delaware. The Company has full corporate power
and authority to own its properties and conduct its business as currently being carried on
and as described in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus, and is duly qualified to do business as a foreign corporation and is in good
standing in each jurisdiction in which it owns or leases real property or in which the
conduct of its business makes such qualification necessary and in which the failure to so
qualify would result in a Material Adverse Change.
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(ii) The capital stock of the Company conforms as to legal matters to the description
thereof contained in the Time of Sale Disclosure Package and the Prospectus under the
caption “Description of Capital Stock.” All of the issued and outstanding shares of the
capital stock of the Company have been duly authorized and validly issued and are fully paid
and nonassessable. The Securities to be issued and sold by the Company hereunder have been
duly authorized and, when issued, delivered and paid for in accordance with the terms of
this Agreement, will have been validly issued and will be fully paid and nonassessable.
Except as otherwise stated in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus, there are no preemptive rights or other rights to subscribe for
or to purchase, or any restriction upon the voting or transfer of, any shares of Common
Stock pursuant to the Company’s certificate of incorporation, bylaws or any Material
Agreement.
(iii) The Registration Statement has become effective under the Act and, to such
counsel’s knowledge, no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been instituted or, to the
knowledge of such counsel, threatened by the Commission and all filings required by Rule
424(b), Rule 430A and Rule 433 under the Act have been made in the manner and in the time
period required therein.
(iv) The descriptions in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus of statutes, regulations, legal and governmental proceedings,
contracts and other documents are accurate in all material respects and fairly present the
information required to be shown (other than with respect to statutes and regulations
administered by the FDA, and proceedings of or before the FDA); and such counsel does not
know of any statutes, regulations, legal or governmental proceedings or contracts or other
documents required to be described in the Time of Sale Disclosure Package or the Prospectus
or included as exhibits to the Registration Statement that are not described or included as
required.
(v) The Company has full corporate power and authority to enter into this Agreement,
and this Agreement has been duly authorized by all necessary corporate action of the
Company, and has been duly executed and delivered by the Company; the execution, delivery
and performance of this Agreement and the consummation of the transactions herein
contemplated at the Closing do not (i) violate any statute, rule or regulation, or (ii)
conflict with or result in a breach or violation of any of the terms and provisions of, or
constitute a default under, (A) any Material Agreement, (B) the Company’s certificate of
incorporation or bylaws, or (C) any order or decree known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or any of its respective
properties; and no consent, approval, authorization or order of, or filing with, any court
or governmental agency or body is required for the execution, delivery and performance of
this Agreement or for the consummation of the transactions contemplated hereby at the
-26-
Closing, including the issuance or sale of the Securities by the Company, except such as may
be required under the Act or state securities laws.
(vi) To such counsel’s knowledge, there are no contracts, agreements or understandings
between the Company and any person granting such person the right (other than rights which
have been waived) to include any securities of the Company owned or to be owned by any
person or entity in the securities registered pursuant to the Registration Statement.
(vii) The Common Stock has been designated for inclusion in the Nasdaq Global Market
(viii) The statements in the Prospectus under the captions “Description of Capital
Stock,” “Related Party Transactions” and “Shares Eligible for Future Sale” and (ii) in Item
14 and Item 15 of the Registration Statement, insofar as such statements constitute matters
of law, summaries of legal matters, the Company’s certificate of incorporation or bylaw
provisions, documents or legal proceedings, or legal conclusions, have been reviewed by such
counsel and fairly present and summarize, in all material respects, the matters referred to
therein.
(ix) The Company is not, and after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in the Registration
Statement, the Time of Sale Disclosure Package and the Prospectus, will not be required to
register as an “investment company” or entity “controlled” by and “investment company”
within the meaning of the Investment Company Act.
(x) To the best of such counsel’s knowledge and other than as set forth in the Time of
Sale Disclosure Package and the Prospectus, there are no judicial, regulatory or other legal
or governmental proceedings pending to which the Company is a party or of which any property
of the Company is the subject which, if determined adversely to the Company, would
individually or in the aggregate have a Material Adverse Effect; and, to the best of such
counsel’s knowledge, no such proceedings are threatened or contemplated.
(xi) The Registration Statement, the Statutory Prospectus included in the Time of Sale
Disclosure Package and the Prospectus, and any amendment thereof or supplement thereto,
comply, and as of their respective effective or issue dates (including without limitation
each deemed effective date with respect to the Underwriters pursuant to the Rules and
Regulations) complied, as to form in all material respects with the requirements of the Act
and the Rules and Regulations; and on the basis of conferences with officers of the Company
and examination of documents referred to in the Registration Statement, the Time of Sale
Disclosure Package and the Prospectus, nothing has come to the attention of such counsel
that causes such counsel to believe that (a) any part of the Registration Statement or any
amendment thereof (including any information omitted from the Registration
-27-
Statement at the
time it became effective but that is deemed to be part of and included in the Registration
Statement pursuant to Rule 430A), when such part became effective (including each deemed
effective date with respect to the Underwriters pursuant to the Rules and Regulations) and
as of such Closing Date (including any Registration Statement filed under Rule 462(b) of the
Rules and Regulations), contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or (b) that the Time of Sale Disclosure Package,
as of the Time of Sale and as of such Closing Date, included or includes any untrue
statement of material fact or omitted or omits to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were made, not
misleading, or (c) that the Prospectus (as of its issue date and as of such Closing Date),
as amended or supplemented, included or includes any untrue statement of material fact or
omitted or omits to state a material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading; it being understood that
such counsel need express no opinion as to the financial statements or other financial or
statistical data included in any of the documents mentioned in this clause (xi).
(f) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, the opinion of King & Spalding L.L.P., special regulatory counsel for the
Company, dated such Closing Date and addressed to you, to the effect that:
(i)
The statements under the captions “Risk Factors—Risks Related to Our Business—We
have not received, and may never receive, FDA approval to market the Alair System,” “Risk
Factors—Risks Related to Our Business—If we are unable to successfully complete our AIR2
Trial, or if we experience significant delays, our ability to commercialize Bronchial
Thermoplasty performed using the Alair System, and our financial position, will be
impaired,” “Risk Factors—Risks Related to Our Business—Even if the Alair System is approved
by regulatory authorities, if we or our suppliers fail to comply with ongoing regulatory
requirements, or if we experience unanticipated problems, the Alair System could be subject
to restrictions or withdrawal from the market,” and “Business—Government Regulation”
(collectively, the “Regulatory Sections”) in the Time of Sale Disclosure Package and the
Prospectus, insofar as such statements purport to summarize applicable provisions of the
FFDCA and the regulations promulgated thereunder, in existence on the date of the
Prospectus, have been reviewed by such counsel and in all material respects are accurate
summaries of the provisions purported to be summarized under such captions in the Time of
Sale Disclosure Package and the Prospectus.
(ii)
The FDA statutes and regulations summarized in the Regulatory Sections in the
Time of Sale Disclosure Package and the Prospectus are
-28-
the FDA statutes and regulations that
are material to the Company’s business as described in the Time of Sale Disclosure Package
and the Prospectus.
(iii) Based solely on such counsel’s review of the Company’s files and such counsel’s
interviews with the Company’s regulatory and clinical staff, such counsel is not aware of
any lawsuit or regulatory proceeding, pending or threatened, brought by or before the FDA,
in which the Company or any of its officers or directors, in their capacity as such, is or
would be the defendant or respondent, except as described in the Time of Sale Disclosure
Package and the Prospectus.
(iv) Based solely on such counsel’s review of the Company’s files and such counsel’s
interviews with the Company’s regulatory and clinical staff, to such counsel’s knowledge,
there are no rulemaking or similar proceedings before the FDA or comparable federal, state,
local or foreign government bodies which involve or affect the Company.
(v) Nothing has come to the attention of such counsel that has caused such counsel to
believe that the information described in the Regulatory Sections, insofar as such
information relates to FDA matters, in (a) the Registration Statement or any amendments
thereof, when such Registration Statement or any such amendment became effective, contained
any untrue statement of a material fact or omitted to state any material fact required to be
stated in the Regulatory Sections or necessary to make the statements contained in the
Regulatory Sections not misleading, (b) the Time of Sale Disclosure Package, as of
Eastern Time on , included any untrue statement of material fact or omitted to
state any material fact necessary to make the statements contained in the Regulatory
Sections, in light of the circumstances under which they were made, not misleading, or (c)
the Prospectus, as of its date and as of the date hereof, included or includes an untrue
statement of a material fact or omitted or omits to state any material fact necessary to make
the statements contained in the Regulatory Sections, in light of the circumstances under
which they were made, not misleading.
(g) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, the opinion of Levine, Bagade, Han LLP, special intellectual property counsel
for the Company, dated such Closing Date and addressed to you, to the effect that:
(i) Such counsel has reviewed those portions of the Registration Statement the
Statutory Prospectus included in the Time of Sale Disclosure Package and the Prospectus and
any further amendments and supplements thereto made by the Company, that concern the
Intellectual Property, including without limitation the statements in the Registration
Statement and the Prospectus under the headings “Risk Factors – Our inability to adequately
protect our intellectual property could allow our competitors and others to produce products
based on our technology, which could substantially impair our ability to compete,” “Risk
Factors – We may become subject
-29-
to claims of infringement or misappropriation of the
intellectual property rights of others, which could prohibit us from shipping affected
products, require us to obtain licenses from third parties or to develop non-infringing
alternatives, and subject us to substantial monetary damages and injunctive relief,”
“Business – Patents and Intellectual Property,” and “Related Party Transactions –
Formation-Related Agreements,” and it is such counsel’s opinion that they are accurate and
complete statements or summaries in all material respects and present fairly the information
required to be shown therein.
(ii) Nothing has come to the attention of such counsel that would lead such counsel to
believe that the information regarding Intellectual Property matters described in (a) the
Registration Statement or any amendment thereof (including any regulatory information
omitted from the Registration Statement at the time it became effective but that is deemed
to be part of and included in the Registration Statement pursuant to Rule 430A), when such
part became effective (including each deemed effective date with respect to the Underwriters
pursuant to the Rules and Regulations) and as of such Closing Date (including any
Registration Statement filed under Rule 462(b) of the Rules and Regulations), contained or
contains an untrue statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements therein not misleading,
(b) the Time of Sale Disclosure Package as of the Time of Sale and as of such Closing Date,
contained or contains an untrue statement of material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, or (c) the Prospectus
(as of its issue date and as of such Closing Date), as amended or supplemented, contained or
contains an untrue statement of a material fact or omitted or omits to state any material
fact required to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(iii) To such counsel’s knowledge, the Company owns or possesses, or can acquire on
reasonable terms, all Intellectual Property rights currently employed by it in connection
with the business now operated by it except where the failure to own or possess or otherwise
be able to acquire such Intellectual Property rights would not, singly or in the aggregate,
have a Material Adverse Effect.
(iv) To such counsel’s knowledge, the Company has not received any notice of
infringement of or conflict with asserted rights of others with respect to any Intellectual
Property rights.
(v) To such counsel’s knowledge, (a) the Company is not infringing or otherwise
violating any Intellectual Property rights of others, and (b) there are no infringements by
others of any of the Company’s Intellectual Property rights, which in such counsel’s
judgment could affect materially the use thereof by the Company.
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(vi) To such counsel’s knowledge, except for proceedings initiated by the Company in
the United States Patent and Trademark Office (“PTO”) and certain foreign patent offices,
(a) there are no legal or governmental proceedings pending relating to any Intellectual
Property rights of the Company, and (b) no such proceedings are threatened or contemplated
by governmental authorities or others.
(vii) Such counsel is not aware of any contracts or other documents relating to the
Company’s Intellectual Property rights of a character required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit to the Registration
Statement that have not been so described or filed required.
(viii) Such counsel has no knowledge of any facts that would preclude the Company from
having valid license rights or clear title to the patents referenced in the Registration
Statement and the Prospectus. Such counsel has no knowledge that the Company lacks or will
be unable to obtain any rights or licenses to use all patents and other material intangible
property and assets necessary to conduct the business now conducted or proposed to be
conducted by the Company as described in the Registration Statement and the Prospectus,
except as described in the Registration Statement and the Prospectus. Such counsel is
unaware of any facts that form a basis for a finding of unenforceability or invalidity of
any of the Company’s Intellectual Property rights.
(ix) Such counsel is not aware of any material fact with respect to the patent
applications of the Company that would (a) preclude the issuance of patents with respect to
such applications or (b) lead such counsel to conclude that such patents, when issued, would
not be valid and enforceable in accordance with applicable regulations.
(x) To such counsel’s knowledge, the Company has complied with the PTO’s duty of candor
and disclosure for the patent applications of the Company and has made no material
misrepresentation in the patent applications of the Company.
For purposes of the foregoing, “Intellectual Property” shall mean any or all of the following and
all rights in: (i) all U.S. and foreign patents and utility models and applications therefor and
all reissues, divisions, re-examinations, renewals, extensions, provisionals, continuations and
continuations-in-part thereof, and equivalent or similar rights anywhere in the world in inventions
and discoveries including without limitation invention disclosures; (ii) all trade secrets and
other rights in know-how and confidential or proprietary information; (iii) all copyrights,
copyrights registrations and applications therefore, and all other copyright rights corresponding
thereto throughout the world; (iv) all industrial designs and any registrations and applications
therefor throughout the world; (v) all rights in domain names and applications and registrations
therefore; (vi) all trade names, logos, trade dress, common law trademarks and service marks,
trademark and service xxxx registrations and applications
-31-
therefore, and all goodwill associated
therewith throughout the world; and (vii) any similar, corresponding or equivalent rights to any of
the foregoing anywhere in the world.
(h) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, such opinion or opinions from Xxxxxx & Xxxxxxx LLP, counsel for the several
Underwriters, dated such Closing Date and addressed to you, with respect to the formation of the
Company, the validity of the Securities, the Registration Statement, the Time of Sale Disclosure
Package or the Prospectus and other related matters as you reasonably may request, and such counsel
shall have received such papers and information as they request to enable them to pass upon such
matters.
(i) On the date of this Agreement and on each Closing Date you, as Representatives of the
several Underwriters, shall have received a letter of PricewaterhouseCoopers LLP, dated such date
and addressed to you, confirming that they are independent public accountants within the meaning of
the Act and are in compliance with the applicable requirements relating to the qualifications of
accountants under Rule 2-01 of Regulation S-X of the Commission, and stating, as of the date of
such letter (or, with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Time of Sale Disclosure Package,
as of a date not prior to the date hereof or more than five days prior to the date of such letter),
the conclusions and findings of said firm with respect to the financial information and other
matters covered by its letter delivered to you concurrently with the execution of this Agreement,
and the effect of the letter so to be delivered on such date shall be to confirm the conclusions
and findings set forth in such prior letter.
(j) On each Closing Date, there shall have been furnished to you, as Representatives of the
Underwriters, a certificate, dated such Closing Date and addressed to you, signed by the chief
executive officer and by the chief financial officer of the Company, to the effect that:
(i) The representations and warranties of the Company in this Agreement are true and
correct, in all material respects, as if made at and as of such Closing Date, and the
Company has complied with all the agreements and satisfied all the conditions on its part to
be performed or satisfied at or prior to such Closing Date;
(ii) No stop order or other order suspending the effectiveness of the Registration
Statement or any part thereof or any amendment thereof or the qualification of the
Securities for offering or sale, nor suspending or preventing the use of the Time of Sale
Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus, has been issued,
and no proceeding for that purpose has been instituted or, to the best of their knowledge,
is contemplated by the Commission or any state or regulatory body; and
(iii) The signers of said certificate have carefully examined the Registration
Statement, the Time of Sale Disclosure Package and the Prospectus, and any amendments
thereof or supplements thereto, and (A) each part of the Registration
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Statement and the
Prospectus, and any amendments thereof or supplements thereto contain, and contained when
such part of the Registration Statement, or any amendment thereof, became effective, all
statements and information required to be included therein, the Registration Statement, or
any amendment thereof, does not contain and did not contain when such part of the
Registration Statement, or any amendment thereof, became effective, any untrue statement of
a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and the Prospectus, as amended or
supplemented, does not include and did not include as of its date or the time of first use
within the meaning of the Rules and Regulations, any untrue statement of material fact or
omit to state and did not omit to state as of its date or the time of first use within the
meaning of the rules and Regulations a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading, (B)
neither (1) the Time of Sale Disclosure Package nor (2) any individual Issuer Limited-Use
Free Writing Prospectus, when considered together with the Time of Sale Disclosure Package,
include, nor included as of the Time of Sale any untrue statement of a material fact or
omits, or omitted as of the Time of Sale, to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under which they were made,
not misleading, (C) since the Time of Sale, there has occurred no event required to be set
forth in an amended or supplemented prospectus which has not been so set forth, (D)
subsequent to the respective dates as of which information is given in the Time of Sale
Disclosure Package, the Company has not incurred any material liabilities or obligations,
direct or contingent, or entered into any material transactions, not in the ordinary course
of business, or declared or paid any dividends or made any distribution of any kind with
respect to its capital stock, and except as disclosed in the Time of Sale Disclosure Package
and in the Prospectus, there has not been any change in the capital stock (other than a
change in the number of outstanding shares of Common Stock due to the issuance of shares
upon the exercise of outstanding options or warrants), or any material change in the
short-term or long-term debt, or any issuance of options, warrants, convertible securities
or other rights to purchase the capital stock, of the Company, or any Material Adverse
Change or any development involving a prospective Material Adverse Change (whether or not
arising in the ordinary course of business), and (E) except as stated in the Time of Sale
Disclosure Package and in the Prospectus, there is not pending, or, to the knowledge of the
Company, threatened or contemplated, any action, suit or proceeding to which the Company is
a party before or by any court or governmental agency, authority or body, or any arbitrator,
which could reasonably be expected to result in any Material Adverse Change.
(k) The Underwriters shall have received all of the Lock-Up Agreements referenced in Section
4(a)(xi).
(l) The Company shall have furnished to you and counsel for the Underwriters such additional
documents, certificates and evidence as you or they may have reasonably requested.
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(m) The Securities shall have been approved for inclusion on the Nasdaq Global Market, subject
only to official notice of issuance.
(n) The NASD shall have confirmed that it has not raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements for the offering of the
Securities.
All such opinions, certificates, letters and other documents will be in compliance with the
provisions hereof only if they are satisfactory in form in the reasonable judgment of you and
counsel for the Underwriters. The Company will furnish you with such conformed copies of such
opinions, certificates, letters and other documents as you shall reasonably request.
6. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter, its affiliates,
directors and officers and each person, if any, who controls such Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and against any losses, claims,
damages or liabilities, joint or several, to which such Underwriter may become subject, under the
Act or otherwise (including in settlement of any litigation if such settlement is effected with the
written consent of the Company), insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement, including the information deemed to be
a part of the Registration Statement at the time of effectiveness and at any subsequent time
pursuant to Rules 430A and 430C, if applicable, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, or arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Time of
Sale Disclosure Package, the Prospectus, or any amendment or supplement thereto, any Issuer Free
Writing Prospectus or in any materials or information provided to investors by, or with the written
approval of, the Company in connection with the marketing of the offering of the Common Stock
(“Marketing Materials”), including any roadshow or investor presentations made to investors by the
Company (whether in person or electronically) or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were made, not
misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred
by it in connection with investigating or defending against such loss, claim, damage, liability or
action; provided, however, that the Company shall not be liable in any such case to the extent that
any such loss, claim, damage, liability or action arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in the Registration
Statement, any Preliminary Prospectus, the Time of Sale Disclosure Package, the Prospectus, or any
such amendment or supplement, any Issuer Free Writing Prospectus or in any Marketing Materials, in
reliance upon and in conformity with information provided in
-34-
writing to the Company by you, or by
any Underwriter through you, specifically for use in the preparation thereof.
In addition to its other obligations under this Section 6(a), the Company agrees that, as an
interim measure during the pendency of any claim, action, investigation, inquiry or other
proceeding arising out of or based upon any statement or omission, or any alleged statement or
omission, described in this Section 6(a), it will reimburse each Underwriter on a monthly basis for
all reasonable legal fees or other expenses incurred in connection with investigating or defending
any such claim, action, investigation, inquiry or other proceeding, notwithstanding the absence of
a judicial determination as to the propriety and enforceability of the Company’s obligation to
reimburse the Underwriters for such expenses and the possibility that such payments might later be
held to have been improper by a court of competent jurisdiction. To the extent that any such
interim reimbursement payment is so held to have been improper, the Underwriter that received such
payment shall promptly return it to the party or parties that made such payment, together with
interest, compounded daily, determined on the basis of the prime rate (or other commercial lending
rate for borrowers of the highest credit standing) announced from time to time by U.S. Bank (the
“Prime Rate”). Any such interim reimbursement payments which are not made to an Underwriter within
30 days of a request for reimbursement shall bear interest at the Prime Rate from the date of such
request. This indemnity agreement shall be in addition to any liabilities which the Company may
otherwise have.
(b) Each Underwriter will indemnify and hold harmless the Company, its affiliates, directors
and officers and each person, if any, who controls the Company within the meaning of Section 15 of
the Act and Section 20 of the Exchange Act, from and against any losses, claims, damages or
liabilities to which the Company may become subject, under the Act or otherwise (including in
settlement of any litigation, if such settlement is effected with the written consent of such
Underwriter), insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, or any amendment or supplement thereto, or
the omission or alleged omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Time of Sale Disclosure Package, the Prospectus, or any amendment or supplement
thereto, or any Issuer Free Writing Prospectus or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were made. not
misleading, in each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the Registration Statement,
any Preliminary Prospectus, the Time of Sale Disclosure Package, the Prospectus, or any such
amendment or supplement, or any Issuer Free Writing Prospectus in reliance upon and in conformity
with information provided in writing to the Company by you, or by such Underwriter through you,
specifically for use in the preparation thereof, and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in
-35-
connection with investigating or defending
against any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice
of the commencement of any action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the indemnifying party shall not
relieve the indemnifying party from any liability that it may have to any indemnified party except
to the extent such indemnifying party has been materially prejudiced by such failure. In case any
such action shall be brought against any indemnified party, and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to participate in, and,
to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of the indemnifying party’s
election so to assume the defense thereof, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that if the Representatives shall have reasonably concluded that
there may be defenses available to the Underwriters that are different from or in addition to those
available to the indemnifying parties, the Representatives shall have the right to employ a single
counsel to represent the Representatives and all Underwriters who may be subject to liability
arising from any claim in respect of which indemnity may be sought by the Underwriters under
subsection (a) of this Section 6, in which event the reasonable fees and expenses of such separate
counsel shall be borne by the indemnifying party or parties and reimbursed to the Underwriters as
incurred (in accordance with the provisions of the second paragraph in subsection (a) above). An
indemnifying party shall not be obligated under any settlement agreement relating to any action
under this Section 6 to which it has not agreed in writing, which agreement shall not be
unreasonably withheld. In addition, no indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any pending or threatened proceeding unless such
settlement includes an unconditional release of such indemnified party for all liability on claims
that are the subject matter of such proceeding and does not include a statement as to or an
admission of fault, culpability or any failure to act by or on behalf of the indemnified party.
(d) If the indemnification provided for in this Section 6 is unavailable or insufficient to
hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above, (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the Securities or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also the relative fault
of the Company on the one hand and the Underwriters on the other in connection with the statements
or omissions that resulted in such losses, claims, damages or
-36-
liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information supplied by the
Company or the Underwriters and the parties’ relevant intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if contributions pursuant to this
subsection (d) were to be determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to in the first sentence of this subsection (d). The amount
paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to
in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating or defending against
any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of
this subsection (d), no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters’ obligations in this subsection (d) to contribute
are several in proportion to their respective underwriting obligations and not joint.
(e) The obligations of the Company under this Section 6 shall be in addition to any liability
which the Company may otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 6 shall be in addition to any liability that the respective
Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company (including any person who, with his consent, is named in the Registration
Statement as about to become a director of the Company), to each officer of the Company who has
signed the Registration Statement and to each person, if any, who controls the Company within the
meaning of the Act.
(f) The Underwriters severally confirm and the Company acknowledges that the statements with
respect to the public offering of the Securities by the Underwriters set forth in the
paragraphs under the heading “Underwriting” in the Prospectus constitute the only information
concerning such Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement, any Preliminary Prospectus,
the Time of Sale Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus.
-37-
7. Representations and Agreements to Survive Delivery. All representations, warranties, and
agreements of the Company herein or in certificates delivered pursuant hereto, and the agreements
of the several Underwriters, the Company contained in Section 6 hereof, shall remain operative and
in full force and effect regardless of any investigation made by or on behalf of any Underwriter or
any controlling person thereof, or the Company or any of its officers, directors, or controlling
persons, and shall survive delivery of, and payment for, the Securities to and by the Underwriters
hereunder.
8. Substitution of Underwriters.
(a) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Firm
Shares agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such
Firm Shares in accordance with the terms hereof, and the amount of Firm Shares not purchased does
not aggregate more than 10% of the total amount of Firm Shares set forth in Schedule II hereto, the
remaining Underwriters shall be obligated to take up and pay for (in proportion to their respective
underwriting obligations hereunder as set forth in Schedule II hereto except as may otherwise be
determined by you) the Firm Shares that the withdrawing or defaulting Underwriters agreed but
failed to purchase.
(b) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Firm
Shares agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such
Firm Shares in accordance with the terms hereof, and the amount of Firm Shares not purchased
aggregates more than 10% of the total amount of Firm Shares set forth in Schedule II hereto, and
arrangements satisfactory to you for the purchase of such Firm Shares by other persons are not made
within 36 hours thereafter, this Agreement shall terminate. In the event of any such termination
the Company shall not be under any liability to any Underwriter (except to the extent provided in
Section 4(a)(viii) and Section 6 hereof) nor shall any Underwriter (other than an Underwriter who
shall have failed, otherwise than for some reason permitted under this Agreement, to purchase the
amount of Firm Shares agreed by such Underwriter to be purchased hereunder) be under any liability
to the Company (except to the extent provided in Section 6 hereof).
If Firm Shares to which a default relates are to be purchased by the non-defaulting
Underwriters or by any other party or parties, the Representatives or the Company shall have the
right to postpone the First Closing Date for not more than seven business days in order that the
necessary changes in the Registration Statement, in the Time of Sale Disclosure Package, in the
Prospectus or in any other documents, as well as any other arrangements, may be effected. As used
herein, the term “Underwriter” includes any person substituted for an Underwriter under this
Section 8.
9. Effective Date of this Agreement and Termination.
(a) This Agreement shall become effective when the parties hereto have executed and delivered
this Agreement.
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(b) You, as Representatives of the several Underwriters, shall have the right to terminate
this Agreement by giving notice as hereinafter specified at any time at or prior to the First
Closing Date, and the option referred to in Section 3(b), if exercised, may be cancelled at any
time prior to the Second Closing Date, if (i) the Company shall have failed, refused or been
unable, at or prior to such Closing Date, to perform any agreement on its part to be performed
hereunder, (ii) any other condition of the Underwriters’ obligations hereunder is not fulfilled,
(iii) trading on the Nasdaq Global Market, the New York Stock Exchange or the American Stock
Exchange shall have been wholly suspended, (iv) trading in the Company’s securities on the Nasdaq
National Market shall have been suspended or materially limited, (v) minimum or maximum prices for
trading shall have been fixed, or maximum ranges for prices for securities shall have been
required, on the Nasdaq National Market, the New York Stock Exchange or the American Stock
Exchange, by such Exchange or by order of the Commission or any other Governmental Authority, (vi)
a banking moratorium shall have been declared by federal or state authorities, (vii) any
downgrading shall have occurred in the Company’s corporate credit rating or the rating accorded the
Company’s debt securities or preferred stock by any “nationally recognized statistical rating
organization” (as defined for purposes of Rule 436(g) under the Act) or any such organization shall
have publicly announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company’s debt securities, or (viii) there shall have
occurred any outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in your judgment, is material and adverse and makes it impractical or
inadvisable to proceed with the completion of the sale of and payment for the Securities. Any such
termination shall be without liability of any party to any other party except that the provisions
of Section 4(a)(viii) and Section 6 hereof shall at all times be effective.
(c) If you elect to prevent this Agreement from becoming effective or to terminate this
Agreement as provided in this Section, the Company shall be notified promptly by you by telephone,
confirmed by letter. If the Company elects to prevent this Agreement from becoming effective, you
shall be notified by the Company by telephone, confirmed by letter.
10. Default by the Company. If the Company shall fail at the First Closing Date to sell and
deliver the number of Securities which it is obligated to sell hereunder, then this Agreement shall
terminate without any liability on the part of any non-defaulting party.
No action taken pursuant to this Section shall relieve the Company from liability, if any, in
respect of such default.
11. No Selective Releases. The Lead Managers agree not to release any stockholder or
optionholder of the Company from his, her or its obligations under any Lock-Up Agreement unless the
Company requests, in writing, that the Lead Managers effect such a release.
12. Notices. Except as otherwise provided herein, all communications hereunder shall be in
writing and, if to the Underwriters, shall be mailed or delivered to the Representatives c/o Xxxxx
Xxxxxxx & Co., 000 Xxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000,
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except that notices given to an
Underwriter pursuant to Section 6 hereof shall be sent to such Underwriter at the address stated in
the Underwriters’ Questionnaire furnished by such Underwriter in connection with this offering,
with a copy to Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000, Attention:
Xxxxxxx Xxxxxxxx; and if to the Company, shall be mailed or delivered to it at 0000 Xxxxx Xxxxxxx,
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxx, with a copy to Fenwick & West LLP,
000 Xxxxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000, Attention: Xxxxx Xxxxxx and Xxxxx Xxxxxxxx.
Any party to this Agreement may change such address for notices by sending to the parties to this
Agreement written notice of a new address for such purpose.
13. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective successors and assigns and the
controlling persons, officers and directors referred to in Section 6. Nothing in this Agreement is
intended or shall be construed to give to any other person, firm or corporation any legal or
equitable remedy or claim under or in respect of this Agreement or any provision herein contained.
The term “successors and assigns” as herein used shall not include any purchaser, as such
purchaser, of any of the Securities from any of the several Underwriters.
14. Absence of Fiduciary Relationship. The Company acknowledges and agrees that: (a) the
Representatives have been retained solely to act as an underwriter in connection with the sale of
the Securities and that no fiduciary, advisory or agency relationship between the Company, on the
one hand, and the Representatives, on the other hand, has been created in respect of any of the
transactions contemplated by this Agreement, irrespective of whether the Representatives have
advised or are advising the Company on other matters; (b) the price and other terms of the
Securities set forth in this Agreement were established by the Company following discussions and
arms-length negotiations with the Representatives and the Company is capable of evaluating and
understanding and understands and accepts the terms, risks and conditions of the transactions
contemplated by this Agreement; (c) the Company has been advised that the Representatives and their
affiliates are engaged in a broad range of transactions which may involve interests that differ
from those of the Company, and that the Representatives have no obligation to disclose such
interest and transactions to the Company by virtue of any fiduciary, advisory or agency
relationship; (d) the Company has been advised that the Representatives are acting, in respect of
the transactions contemplated by this Agreement solely for the benefit of the Representatives and
the other Underwriters, and not on behalf of the Company; (e) the Company waives to the fullest
extent permitted by law, any claims he, she or it may have against the Representatives for breach
of fiduciary duty or alleged breach of fiduciary duty in respect of any of the transactions
contemplated by this Agreement and agrees that the Representatives shall have no liability (whether
direct or indirect) to the Company in respect of such a fiduciary duty claim on behalf of or in
right of the Company, including stockholders, employees or creditors of the Company, as applicable.
15. Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York. The Company irrevocably (a) submits to the jurisdictions of any
court of the State of New York or the United States District Court for
-00-
xxx Xxxxxxxx Xxxxxxxx of the
State of New York for the purpose of any suit, action or other proceeding arising out of this
Agreement, or any of the agreements or transactions contemplated by this Agreement, the
Registration Statement and the Prospectus (each, a “Proceeding”), (b) agrees that all claims in
respect of any Proceeding may be heard and determined in any such court, (c) waives, to the fullest
extent permitted by law, any immunity from jurisdiction of any such court or from any legal process
therein, (d) agrees not to commence any Proceeding other than in such courts, and (e) waives, to
the fullest extent permitted by law, any claim that such Proceeding is brought in an inconvenient
forum.
16. Counterparts. This Agreement may be executed in one or more counterparts and, if executed
in more than one counterpart, the executed counterparts shall each be deemed to be an original and
all such counterparts shall together constitute one and the same instrument.
17. Headings. The headings herein are inserted for convenience of reference only and are not
intended to be part of, or to affect the meaning or interpretation of, this Agreement.
18. Time is of the Essence. Time shall be of the essence of this Agreement. As used herein,
the term “business day” shall mean any day when the Commission’s office in Washington, D.C. is open
for business.
[Signature Page Follows]
-41-
Please sign and return to the Company the enclosed duplicates of this letter whereupon this
letter will become a binding agreement between the Company and the several Underwriters in
accordance with its terms.
| Very truly yours, | ||||||
| Asthmatx, Inc. | ||||||
| By | ||||||
Confirmed as of the date first
above mentioned, on behalf of
themselves and the other several
Underwriters named in Schedule II
hereto.
above mentioned, on behalf of
themselves and the other several
Underwriters named in Schedule II
hereto.
XXXXX XXXXXXX & CO.
BEAR, XXXXXXX & CO. INC.
FIRST ALBANY CAPITAL INC.
XXXXXXXXX & COMPANY, INC.
BEAR, XXXXXXX & CO. INC.
FIRST ALBANY CAPITAL INC.
XXXXXXXXX & COMPANY, INC.
| By: | Xxxxx Xxxxxxx & Co. | |||||
| By | ||||||
| By: | Bear, Xxxxxxx & Co. Inc. | |||||
| By | ||||||
SCHEDULE I
| Underwriter | Number of Firm Shares (1) | |||
Xxxxx Xxxxxxx & Co. |
||||
Bear, Xxxxxxx & Co. Inc. |
||||
First Albany Capital Inc. |
||||
Xxxxxxxxx & Company, Inc. |
||||
Total |
||||
| (1) | The Underwriters may purchase up to an additional [ ] Option Shares, to the extent the option described in Section 3(b) of the Agreement is exercised, in the proportions and in the manner described in the Agreement. |
SCHEDULE II
Issuer General Free Writing Prospectuses
Exhibit A
FORM OF LOCK-UP AGREEMENT
July ___, 2006
Xxxxx Xxxxxxx & Co.
Bear Xxxxxxx & Co. Inc.
First Albany Capital Inc.
Jefferies & Co., Inc.
Bear Xxxxxxx & Co. Inc.
First Albany Capital Inc.
Jefferies & Co., Inc.
c/o Xxxxx Xxxxxxx & Co.
000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
c/o Bear Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re:
|
Proposed Initial Public Offering of Asthmatx, Inc. |
Ladies and Gentlemen:
The undersigned understands that you will act as representatives for a group of underwriters (the
“Underwriters”) that proposes to enter into a Purchase Agreement (the “Purchase Agreement”) with
Asthmatx, Inc. (the “Company”), providing for the initial public offering (the “Offering”) by the
Underwriters of common stock of the Company (“the Common Stock”) pursuant to the Company’s
registration statement on Form S-1, to be filed with the U.S. Securities and Exchange Commission.
In consideration of the Underwriters’ agreement to purchase and make the Offering, and for other
good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the
undersigned hereby agrees that without the prior written consent of Xxxxx Xxxxxxx & Co. (“Xxxxx
Xxxxxxx”) and Bear Xxxxxxx & Co. Inc. (“Bear Xxxxxxx”), on behalf of the Underwriters (which
consent may be withheld in Xxxxx Xxxxxxx’x and Bear Xxxxxxx’ sole discretion), the undersigned will
not, during the period commencing on the date hereof and ending 180 days after the date of the
Purchase Agreement (the “Lock-Up Period”), directly or indirectly: (1) offer, sell, contract to
sell, pledge, sell any option or contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of any
shares of the Common Stock, or any securities convertible into or exercisable or exchangeable for
the Common Stock; (2) enter into any swap or other arrangement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the Common Stock, or any securities
convertible into or exchangeable for the Common Stock, regardless of whether any such transaction
described herein is to be settled by delivery of the Common Stock or such other securities, or by
delivery of cash or otherwise; (3) make any demand for, or exercise any right with respect to, the
registration of any shares of the Common Stock or any security convertible into or exercisable or
exchangeable for the Common Stock; or (4) publicly announce any intention to do any of the
foregoing. Nothing in the foregoing sentence shall prohibit the undersigned’s (A) exercise of any
option or warrant to acquire Common Stock or conversion of any convertible security into Common
Stock, provided
1
that any shares of Common Stock obtained by such exercise or conversion shall remain subject to the
terms of this Lock-Up Agreement or (B) sale of any shares of Common Stock or other securities
acquired in the Offering or in open market transactions after the completion of the Offering,
provided such transfer is not required to be reported, and the undersigned does not otherwise
voluntarily report such transfer, in any public report or filing with the Securities and Exchange
Commission. The undersigned agrees that (i) any request for a release from the provisions of this
Lock-Up Agreement shall be made on behalf of the undersigned by the Company, (ii) the Company shall
be solely responsible for ensuring that any such request does not conflict with any agreements
among the stockholders of the Company, including the Second Amended and Restated Investor Rights
Agreement, dated as of December 9, 2005 among the Company and the Investors party thereto and (iii)
none of Xxxxx Xxxxxxx, Bear Xxxxxxx or any other Underwriter shall have any liability with respect
to any such release.
Notwithstanding the foregoing, the undersigned may transfer shares of Common Stock or any security
convertible into shares of Common Stock (i) as a bona fide gift or gifts and (ii) by will or
intestate succession to the undersigned’s immediate family or to a trust, the beneficiaries of
which are exclusively the undersigned or members of the undersigned’s immediate family; provided,
however, that in the case of any transfer pursuant to clause (i) or (ii):
(a) the undersigned provides prior written notice of such gift, pledge or transfer to Xxxxx
Xxxxxxx and Bear Xxxxxxx;
(b) each donee, pledgee or transferee (as the case may be) executes an agreement stating that
such party is bound by the restrictions set forth herein;
(c) any such transfer does not involve a disposition for value; and
(d) such transfer is not required to be reported, and the undersigned does not otherwise
voluntarily report such transfer, in any public report or filing with the Securities and Exchange
Commission (except for transfers which may be reported by the undersigned on an annual statement on
Form 5).
For purposes of this agreement, “immediate family” shall mean any relationship by blood, marriage
or adoption not more remote than first cousin.
Anything herein to the contrary notwithstanding, if:
| (1) | during the last 17 days of the Lock-Up Period, the Company issues an earnings release or publicly announces other material news or a material event relating to the Company occurs; or |
| (2) | prior to the expiration of the Lock-Up Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Lock-Up Period, |
the Lock-Up Period shall be extended and the restrictions imposed by this letter shall continue to
apply until the expiration of the 18-day period beginning on the date of issuance of the earnings
2
release or the public announcement of other material news or the occurrence of a material event, as
applicable, unless Xxxxx Xxxxxxx and Bear Xxxxxxx waive such extension in writing.
The undersigned hereby acknowledges and agrees that written notice of any waiver of the extension
of the Lock-Up Period pursuant to the previous paragraph will be delivered by Xxxxx Xxxxxxx and
Bear Xxxxxxx to the Company and that any such notice properly delivered will be deemed to have been
given to, and received by, the undersigned. The undersigned further agrees that, prior to engaging
in any transaction or taking any other action that is subject to the terms of this Lock-up
Agreement during the period from the date of this Lock-up Agreement to and including the 34th day
following the expiration of the Lock-Up Period, it will not consummate such transaction or take any
such action if it has received written notice from the Company that the Lock-Up Period has been
extended pursuant to the previous paragraph.
Notwithstanding the restrictions of this Lock-Up Agreement, the undersigned may at any time enter
into a written plan meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of
1934 (the “Exchange Act”) relating to the sale of securities of the Company, if then permitted by
the Company, provided that (a) the securities subject to such plan may not be sold until after
expiration of the Lock-Up Period and (b) no public announcement regarding such plan is made or
required to be made by press release, Exchange Act report or otherwise prior to the expiration of
the Lock-Up Period.
The undersigned hereby agrees and consents to the entry of stop transfer instructions with the
Company’s transfer agent against the transfer of securities of the Company held by the undersigned,
except in compliance with this Lock-Up Agreement.
If (i) the Purchase Agreement terminates or is terminated prior to the payment for an delivery of
the shares of Common Stock proposed for sale in the Offering, (ii) the Company notifies Xxxxx
Xxxxxxx and Bear Xxxxxxx in writing that it does not intend to proceed with the Offering or (iii)
the initial closing of the Offering does not occur on or prior to March 31, 2007, this Lock-Up
Agreement shall terminate immediately upon such date and be of no further force and effect.
The undersigned recognizes that the Offering will benefit the undersigned and the Company. The
undersigned acknowledges that the Underwriters are relying on the representations and agreements of
the undersigned contained in this Lock-Up Agreement in carrying out the Offering and in entering
into the Purchase Agreement. Notwithstanding the foregoing, you acknowledge that whether or not the
Offering actually occurs depends on several factors, including market conditions.
3
The undersigned hereby represents and warrants that the undersigned has full power and authority to
enter into this Lock-Up Agreement. This Lock-Up Agreement is irrevocable and all authority herein
conferred or agreed to be conferred shall survive the death or incapacity of the undersigned and
any obligations of the undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
| Very truly yours, | ||||||
| Signature: | ||||||
| Printed Name: | ||||||
| Capacity: | ||||||
| (Indicate capacity of person signing if signing as custodian or trustee or on behalf of an entity) | ||||||
| Address: | ||||||
4
