Exhibit 99.1
3,000,000 SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE
CLINICAL DATA, INC.
UNDERWRITING AGREEMENT
July 17, 2007
BEAR, XXXXXXX & CO. INC.
As Representative of the
several Underwriters named in
Schedule I attached hereto (the "Representative")
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies/Gentlemen:
Clinical Data, Inc., a corporation organized and existing under the
laws of the State of Delaware (the "Company"), proposes, subject to the terms
and conditions stated herein, to issue and sell to the several underwriters
named in Schedule I hereto (the "Underwriters") an aggregate of 3,000,000 shares
(the "Firm Shares") of its Common Stock, par value $0.01 per share, (the "Common
Stock"), and, for the sole purpose of covering over-allotments in connection
with the sale of the Firm Shares, at the option of the Underwriters, up to an
additional 450,000 shares (the "Additional Shares") of Common Stock. The Firm
Shares and any Additional Shares purchased by the Underwriters are referred to
herein as the "Shares". Bear, Xxxxxxx & Co. Inc. ("Bear Xxxxxxx") is acting as
lead manager (the "Lead Manager") in connection with the offering and sale of
the Shares contemplated herein (the "Offering").
1. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, each of the Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement under the Securities Act of 1933, as
amended (the "Securities Act"), relating to the Shares, on Form S-3 (No.
333-143883) (the initial filing and all pre-effective amendments thereto
collectively being referred to as the "Initial Registration Statement"); and
such Initial Registration Statement, and any post-effective amendment thereto,
each in the form previously delivered to you, have been declared effective by
the Commission, in such form. Other than a registration statement, if any,
increasing the size of the Offering (a "Rule 462(b) Registration Statement")
filed pursuant to Rule 462(b) under the Securities Act, which will become
effective upon filing, no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission. The
various parts of the Initial Registration Statement and the 462(b) Registration
Statement, if any, including all exhibits
thereto and including (i) the information contained in the form of final
prospectus filed with the Commission pursuant to Rule 424(b) under the
Securities Act in accordance with Section 4(a) hereof and deemed by virtue of
430B under the Securities Act to be part of the Initial Registration Statement
at the time it became effective under the Securities Act with respect to the
Underwriters, and (ii) the documents incorporated by reference in the prospectus
contained in the Initial Registration Statement at the time such part of the
Initial Registration Statement becomes effective, each as amended at the time
such part of the Initial Registration Statement or the Rule 462(b) Registration
Statement, if any, became or hereafter becomes effective under the Securities
Act with respect to the Underwriters, are hereafter collectively referred to as
the "Registration Statement." Any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), after the effective date of the
Initial Registration Statement that is incorporated by reference therein. No
stop order suspending the effectiveness of the Initial Registration Statement,
any post-effective amendment thereto or the Rule 462(b) Registration Statement,
if any, has been issued and no proceeding for that purpose has been initiated or
threatened by the Commission.
The final prospectus supplement together with the base prospectus
included in the Initial Registration Statement, in the form in which it has most
recently been filed with the Commission on or prior to the date of this
Agreement (the "Basic Prospectus") relating to the Shares, in the form first
filed with the Commission pursuant to Rule 424(b) under the Securities Act, is
hereafter referred to as the "Prospectus". Any preliminary prospectus supplement
together with the Basic Prospectus included in the Initial Registration
Statement or filed with the Commission pursuant to Rule 424 under the Securities
Act is hereafter referred to as a "Preliminary Prospectus;" and the Preliminary
Prospectus relating to the Shares, as amended or supplemented immediately prior
to the Applicable Time (as defined below), is hereafter referred to as the
"Pricing Prospectus". Any "issuer free writing prospectus" (as defined in Rule
433 under the Securities Act) relating to the Shares is hereafter referred to as
an "Issuer Free Writing Prospectus"; and the Pricing Prospectus, as supplemented
by the public offering price of the Shares, the number of Shares offered and the
Issuer Free Writing Prospectuses, if any, attached and listed in Annex IV
hereto, taken together, are hereafter referred to collectively as the "Pricing
Disclosure Package". Any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S- 3 that were filed under the
Exchange Act on or before the date of such Preliminary Prospectus or Prospectus,
as the case may be; and any reference herein to any "amendment" or "supplement"
to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include (i) the filing of any document under the Exchange Act after the date of
such Preliminary Prospectus or Prospectus, as the case may be, which is
incorporated therein by reference and (ii) any such document so filed.
The Company was not an "ineligible issuer" (as defined in Rule 405
under the Securities Act) as of the eligibility determination date for purposes
of Rules 164 and 433 under the Securities Act with respect to the offering of
the Shares contemplated hereby.
All references in this Agreement to the Registration Statement, the
Rule 462(b) Registration Statement, any Preliminary Prospectus, the Pricing
Prospectus, Issuer Free Writing Prospectus or the Prospectus, or any amendments
or supplements to any of the foregoing, shall
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be deemed to include any copy thereof filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval System.
(b) The Registration Statement complies and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will comply in all material respects with the applicable provisions
of the Securities Act, the Exchange Act and the rules and regulations of the
Commission thereunder (the "Rules and Regulations"), and do not and will not, as
of the applicable effective date as to each part of the Registration Statement
and as of the applicable filing date as to the Prospectus and any amendment
thereof or supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein (i) in the case of the Registration
Statement, not misleading and (ii) in the case of the Prospectus, in light of
the circumstances under which they were made, not misleading; provided, however,
that this representation and warranty shall not apply to any information
contained in or omitted from the Registration Statement or the Prospectus or any
amendment thereof or supplement thereto in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through Bear Xxxxxxx specifically for use therein. The parties
hereto agree that such information provided by or on behalf of any Underwriter
through Bear Xxxxxxx consists solely of the material referred to in Section 16
hereof.
(c) No order preventing or suspending the use of any Preliminary
Prospectus or any Issuer Free Writing Prospectus has been issued by the
Commission, and each Preliminary Prospectus, at the time of filing thereof,
complied in all material respects with the applicable provisions of the
Securities Act, the Exchange 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
light of the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
information contained in or omitted from any Preliminary Prospectus in reliance
upon and in conformity with information furnished in writing to the Company by
or on behalf of any Underwriter through Bear Xxxxxxx specifically for use
therein. The parties hereto agree that such information provided by or on behalf
of any Underwriter through Bear Xxxxxxx consists solely of the material referred
to in Section 16 hereof.
(d) For purposes of this Agreement, the "Applicable Time" is the time
of first sale of the Shares in connection with the Offering. The Pricing
Disclosure Package, as of the Applicable Time, did not, and as of the Closing
Date and the Additional Closing Date, if any (each as hereinafter defined), will
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 light of the circumstances under which they were made, not misleading. Each
Issuer Free Writing Prospectus complies in all material respects with the
applicable provisions of the Securities Act and the Rules and Regulations, and
does not include information that conflicts with the information contained in
the Registration Statement, the Pricing Prospectus or the Prospectus, and each
Issuer Free Writing Prospectus not listed in Annex IV hereto, as supplemented by
and taken together with the Pricing Disclosure Package, as of the Applicable
Time, did not, and as of the Closing Date and the Additional Closing Date, if
any, will 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 light of the circumstances under which
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they were made, not misleading. No representation and warranty is made in this
Section 1(d) with respect to any information contained in or omitted from the
Pricing Disclosure Package or any Issuer Free Writing Prospectus in reliance
upon and in conformity with information furnished in writing to the Company by
or on behalf of any Underwriter through Bear Xxxxxxx specifically for use
therein. The parties hereto agree that such information provided by or on behalf
of any Underwriter through Bear Xxxxxxx consists solely of the material referred
to in Section 16 hereof.
(e) Deloitte & Touche LLP, who have certified the consolidated
financial statements and supporting schedules and information of the Company and
its subsidiaries that are included or incorporated by reference in the
Registration Statement, the Pricing Prospectus or the Prospectus are independent
public accountants as required by the Securities Act, the Exchange Act and the
Rules and Regulations.
(f) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Pricing Prospectus, except as
disclosed in the Pricing Prospectus, (i) the Company has not declared or paid
any dividends, or made any other distributions of any kind, on or in respect of
its capital stock, except for dividends declared and/or paid on the Company's
Series A voting convertible preferred stock in the ordinary course, (ii) there
has not been any change in the capital stock or material increase in the
long-term or short-term debt of the Company or any of its subsidiaries listed in
Exhibit A hereto (each, a "Subsidiary" and, collectively, the "Subsidiaries"),
(iii) neither the Company nor any Subsidiary has 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 (iv) there
has not been any material adverse change or any development involving a
prospective material adverse change, whether or not arising from transactions in
the ordinary course of business, in the business, management, condition
(financial or otherwise), results of operations, stockholders' equity,
properties or prospects of the Company and the Subsidiaries, individually or
taken as a whole (a "Material Adverse Change"). Since the date of the latest
balance sheet included, or incorporated by reference, in the Registration
Statement and the Pricing Prospectus, neither the Company nor any Subsidiary has
incurred or undertaken any liabilities or obligations, whether direct or
indirect, liquidated or contingent, matured or unmatured, or entered into any
transactions, including any acquisition or disposition of any business or asset,
which are material to the Company and the Subsidiaries, individually or taken as
a whole, except for liabilities, obligations and transactions which are
disclosed in the Registration Statement and in the Pricing Prospectus.
(g) The issued and outstanding capital stock of the Company is as set
forth in the Pricing Prospectus, under the caption "Capitalization" (other than
for subsequent issuances pursuant to employee benefit plans or issuances upon
the exercise of outstanding options or warrants) and all of the issued and
outstanding shares of capital stock of the Company have been duly and validly
authorized and are fully paid and non-assessable and were issued in compliance
with all applicable state, federal and foreign securities laws and not in
violation of or subject to any preemptive or similar right that entitles any
person to acquire from the Company or any subsidiary any Common Stock or other
equity security of the Company or any security convertible into, or exercisable
or exchangeable for, Common Stock or any other such security (any "Relevant
Security"), except for such rights as may have been fully satisfied or waived
prior
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to the effectiveness of the Registration Statement. All of the issued shares of
capital stock of or other ownership interests in each Subsidiary have been duly
and validly authorized and issued and are fully paid and non-assessable and,
except as set forth in the Pricing Prospectus, are owned directly or indirectly
by the Company free and clear of any lien, charge, mortgage, pledge, security
interest, claim, equity, trust or other encumbrance, preferential arrangement,
defect or restriction of any kind whatsoever (any "Lien").
(h) The Shares to be delivered on the Closing Date and the Additional
Closing Date (as hereinafter defined), if any, have been duly and validly
authorized and, when issued and delivered in accordance with this Agreement,
will be duly and validly issued, fully paid and non-assessable, will have been
issued in compliance with all applicable state, federal and foreign securities
laws and will not have been issued in violation of or subject to any preemptive
or similar right that entitles any person to acquire any Relevant Security from
the Company. The Common Stock and the Shares conform to the descriptions thereof
contained in the Registration Statement, the Pricing Prospectus and the
Prospectus. Except as disclosed in the Pricing Prospectus, the Company has no
outstanding warrants, options to purchase, or any preemptive rights or other
rights to subscribe for or to purchase, or any contracts or commitments to issue
or sell, any Relevant Security. Except as disclosed in the Pricing Prospectus,
no holder of any Relevant Security has any rights to require registration under
the Securities Act of any Relevant Security in connection with the offer and
sale of the Shares contemplated hereby, and any such rights so disclosed have
either been fully complied with by the Company or effectively waived by the
holders thereof.
(i) The Subsidiaries are the only "subsidiaries" of the Company
(within the meaning of Rule 405 under the Securities Act). The Company and each
Subsidiary has been duly organized and is validly existing as a corporation,
partnership or limited liability company in good standing under the laws of its
jurisdiction of organization. Each of the Company and each Subsidiary is duly
qualified to do business and is in good standing as a foreign corporation,
partnership or limited liability company in each jurisdiction in which the
character or location of its properties (owned, leased or licensed) or the
nature or conduct of its business makes such qualification necessary, except for
those failures to be so qualified or in good standing which (individually and in
the aggregate) could not reasonably be expected to have a material adverse
effect on (i) the business, management, condition (financial or otherwise),
results of operations, stockholders' equity, properties or prospects of the
Company and the Subsidiaries, taken as a whole; or (ii) the ability of the
Company to consummate the Offering or any other transactions contemplated by
this Agreement or the Pricing Prospectus (a "Material Adverse Effect").
(j) The Company and each Subsidiary has all requisite power and
authority, and all necessary consents, approvals, authorizations, orders,
registrations, qualifications, licenses, filings and permits of, with and from
all judicial, regulatory and other legal or governmental agencies and bodies and
all third parties, foreign and domestic (individually a "Consent" and
collectively, the "Consents"), to own, lease and operate its properties and
conduct its business as it is now being conducted and as disclosed in the
Registration Statement and the Pricing Prospectus, and each such Consent is
valid and in full force and effect, except in each case as could not reasonably
be expected to have a Material Adverse Effect. Neither the Company nor any
Subsidiary has received notice of any investigation or proceedings which, if
decided adversely to the Company or any such Subsidiary, could reasonably be
expected to
5
result in, the revocation of, or imposition of a materially burdensome
restriction on, any such Consent.
(k) This Agreement has been duly and validly authorized, executed and
delivered by the Company.
(l) The issue and sale of the Shares, the compliance by the Company
with this Agreement and the consummation of the transactions herein contemplated
do not and will not (i) conflict with or result in a breach or violation of any
of the terms and provisions of, or constitute a default (or an event which with
notice or lapse of time, or both, would constitute a default) under, or result
in the creation or imposition of any Lien upon any property or assets of the
Company or any Subsidiary pursuant to, any indenture, mortgage, deed of trust,
loan agreement or other agreement, instrument, franchise, license or permit to
which the Company or any Subsidiary is a party or by which the Company or any
Subsidiary or their respective properties, operations or assets may be bound or
(ii) violate or conflict with any provision of the certificate or articles of
incorporation, by-laws, certificate of formation, limited liability company
agreement, partnership agreement or other organizational documents of the
Company or any Subsidiary, or (iii) violate or conflict with any statute, law,
rule, regulation, ordinance, directive, judgment, decree or order of any
judicial, regulatory or other legal or governmental agency or body, domestic or
foreign.
(m) No Consent of, with or from any judicial, regulatory or other
legal or governmental agency or body or any third party, foreign or domestic, is
required for the execution, delivery and performance of this Agreement or
consummation of the transactions contemplated by this Agreement, except the
registration under the Securities Act of the Shares and such Consents as may be
required under state securities or blue sky laws or the by-laws and rules of the
National Association of Securities Dealers, Inc. (the "NASD") in connection with
the purchase and distribution of the Shares by the Underwriters, each of which
has been obtained and is in full force and effect.
(n) Except as disclosed in the Registration Statement, the Pricing
Prospectus and the Prospectus, there is no judicial, regulatory, arbitral or
other legal or governmental proceeding or other litigation or arbitration,
domestic or foreign, pending to which the Company or any Subsidiary is a party
or of which any property, operations or assets of the Company or any Subsidiary
is the subject which, individually or in the aggregate, if determined adversely
to the Company or any Subsidiary, could reasonably be expected to have a
Material Adverse Effect; to the Company's knowledge, no such proceeding,
litigation or arbitration is threatened or contemplated; and the defense of all
such proceedings, litigation and arbitration against or involving the Company or
any Subsidiary could not reasonably be expected to have a Material Adverse
Effect.
(o) The Company's financial statements, including the notes thereto,
and the supporting schedules included or incorporated by reference in the
Registration Statement, the Pricing Prospectus and the Prospectus present
fairly, in all material respects, the financial position as of the dates
indicated and the cash flows and results of operations for the periods specified
of the Company and its consolidated subsidiaries; and except as otherwise stated
in the Registration Statement, the Pricing Prospectus and the Prospectus, said
financial statements have
6
been prepared in conformity with United States generally accepted accounting
principles applied on a consistent basis throughout the periods involved. No
other financial statements or supporting schedules are required to be included
in the Registration Statement, the Pricing Prospectus or the Prospectus by the
Securities Act, the Exchange Act or the Rules and Regulations. The other
financial and statistical information included or incorporated by reference in
the Registration Statement, the Pricing Prospectus and the Prospectus are
accurately presented in all material respects and have been prepared on a basis
consistent with that of the financial statements that are included or
incorporated by reference in the Registration Statement, the Pricing Prospectus
and the Prospectus and the books and records of the respective entities
presented therein.
(p) The statistical, industry-related and market-related data included
in the Registration Statement, the Pricing Prospectus 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.
(q) The Common Stock has been registered pursuant to Section 12(b) of
the Exchange Act. The shares of Common Stock are listed on The Nasdaq Global
Market ("Nasdaq"), and the Company has taken no action designed to, or likely to
have the effect of, terminating the registration of the Common Stock under the
Exchange Act or de-listing the Common Stock from Nasdaq, nor has the Company
received any notification that the Commission or Nasdaq is contemplating
terminating such registration or listing.
(r) The Company and its Subsidiaries maintain a system of internal
accounting and other controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with United States generally
accepted accounting principles and to maintain accountability for assets, (iii)
access to assets is permitted only in accordance with management's general or
specific authorization, and (iv) the recorded accounting for assets is compared
with existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(s) 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. Except as disclosed in the Registration Statement, the Pricing
Prospectus and the Prospectus, the Company's internal control over financial
reporting is effective and the Company is not aware of any material weaknesses
in its internal control over financial reporting. Since the date of the latest
audited financial statements included or incorporated by reference in the
Registration Statement, the Pricing Prospectus and the Prospectus, there has
been no change in the Company's internal control over financial reporting that
has materially affected, or is reasonably likely to materially affect, the
Company's internal control over financial reporting.
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(t) The Company maintains "disclosure controls and procedures" (as
such term is defined in Rule 13a-15(e) under the Exchange Act) that comply with
the requirements of the Exchange Act; such disclosure controls and procedures
have been designed to ensure that material information relating to the Company
and its subsidiaries is made known to the Company's principal executive officer
and principal financial officer by others within those entities; and such
disclosure controls and procedures are effective.
(u) The Company is in compliance in all material respects with all
applicable provisions of the Xxxxxxxx-Xxxxx Act of 2002 and all rules and
regulations promulgated thereunder or implementing the provisions thereof (the
"Xxxxxxxx-Xxxxx Act") and is taking commercially reasonable steps to ensure that
it will be in compliance in all material respects with other provisions of the
Xxxxxxxx-Xxxxx Act not currently in effect, upon the effectiveness of such
provisions.
(v) Neither the Company nor any of its affiliates (within the meaning
of Rule 144 under the Securities Act) has taken, directly or indirectly, any
action which constitutes or is designed to cause or result in, or which could
reasonably be expected to constitute, cause or result in, the stabilization or
manipulation of the price of any security to facilitate the sale or resale of
the Shares.
(w) Neither the Company nor any of its affiliates (within the meaning
of Rule 144 under the Securities Act) has, prior to the date hereof, made any
offer or sale of any securities which could be "integrated" (within the meaning
of the Securities Act and the Rules and Regulations) with the offer and sale of
the Shares pursuant to the Registration Statement.
(x) The statements set forth in the Registration Statement, the
Pricing Prospectus and Prospectus under the caption "Description of Capital
Stock", insofar as it purports to constitute a summary of the terms of the
Common Stock, and under the caption "Underwriting", insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate, complete and fair in all material respects.
(y) The Company is subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act and files periodic reports with the Commission, and
the conditions for use of Form S-3 to register and offer the Shares under the
Securities Act have been satisfied. The documents incorporated or deemed to be
incorporated by reference in the Pricing Prospectus and the Prospectus, at the
time they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the Securities Act, the
Exchange Act and the Rules and Regulations and, when read together with the
other information in the Pricing Prospectus or the Prospectus, as applicable, do
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.
(z) The Company is not and, at all times up to and including
consummation of the transactions contemplated by this Agreement, and after
giving effect to application of the net proceeds of the Offering as described in
the Registration Statement, the Pricing Prospectus and the Prospectus, will not
be, required to register as an "investment company" under the
8
Investment Company Act of 1940, as amended, and is not and will not be an entity
"controlled" by an "investment company" within the meaning of such act.
(aa) Except as disclosed in the Registration Statement, the Pricing
Prospectus 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 issuances with respect to the Company or
any of its officers, directors, shareholders, partners, employees, Subsidiaries
or affiliates that may affect the Underwriters' compensation as determined by
the NASD.
(bb) The Company and each Subsidiary owns or leases all such
properties as are necessary to the conduct of its business as presently operated
and as proposed to be operated as described in the Registration Statement, the
Pricing Prospectus and the Prospectus. The Company and the Subsidiaries have
good and marketable title in fee simple to all real property and good and valid
title to all personal property owned by them, in each case free and clear of any
and all Liens except such as are described in the Registration Statement, the
Pricing Prospectus and the Prospectus or such as do not (individually or in the
aggregate) materially affect the value of such property or materially interfere
with the use made or proposed to be made of such property by the Company and the
Subsidiaries; and any real property and buildings held under lease or sublease
by the Company and the Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material to, and do not
materially interfere with, the use made and proposed to be made of such property
and buildings by the Company and the Subsidiaries. Neither the Company nor any
Subsidiary has 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 by the Company
or any Subsidiary.
(cc) Each of the Company and each Subsidiary (i) owns or possesses the
right to use all patents, patent applications, trademarks, service marks, domain
names, trade names, trademark registrations, service xxxx registrations,
copyrights, licenses, formulae, customer lists, and know-how and other
intellectual property (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures,
"Intellectual Property") necessary for the conduct of their respective
businesses as presently conducted and as described in the Registration
Statement, the Pricing Prospectus and the Prospectus and (ii) has no reason to
believe that the conduct of their respective businesses does or will conflict
with, and have not received any notice of any claim of conflict with, any such
right of others. To the Company's knowledge, all material technical information
developed by and belonging to the Company or any Subsidiary which has not been
patented has been kept confidential. Neither the Company nor any Subsidiary has
granted, licensed or assigned to any other person or entity any right to
manufacture, have manufactured, assemble or sell the current products and
services of the Company and its Subsidiaries or those products and services
described in the Registration Statement, the Pricing Prospectus and the
Prospectus. There is no infringement by third parties of any such Intellectual
Property; there is no pending or, to the Company's knowledge, threatened action,
suit, proceeding or claim by others challenging the Company's or any
Subsidiary's rights in or to any such Intellectual Property, and the Company is
unaware of any facts which would
9
form a reasonable basis for any such claim; and there is no pending or, to the
Company's knowledge, threatened action, suit, proceeding or claim by others that
the Company or any Subsidiary infringes or otherwise violates any patent,
trademark, copyright, trade secret or other proprietary rights of others, and
the Company is unaware of any other fact which would form a reasonable basis for
any such claim.
(dd) The Company and the Subsidiaries maintain insurance in such
amounts and covering such risks as the Company reasonably considers 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, all of which
insurance is in full force and effect, except where the failure to maintain such
insurance could not reasonably be expected to have a Material Adverse Effect.
There are no material claims by the Company or any Subsidiary under any such
policy or instrument as to which any insurance company is denying liability or
defending under a reservation of rights clause. The Company reasonably believes
that it will be able to renew its existing insurance as and when such coverage
expires or will be able to obtain replacement insurance adequate for the conduct
of the business and the value of its properties at a cost that would not have a
Material Adverse Effect.
(ee) Each of the Company and each Subsidiary has accurately prepared
and timely filed all federal, state, foreign and other tax returns that are
required to be filed by it and has paid or made provision for the payment of all
taxes, assessments, governmental or other similar charges, including without
limitation, all sales and use taxes and all taxes which the Company or any
Subsidiary 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), except for
such taxes that individually or in the aggregate could not reasonably be
expected to have a Material Adverse Effect. No deficiency assessment with
respect to a proposed adjustment of the Company's or any Subsidiary' federal,
state, local or foreign taxes is pending or, to the best of the Company's
knowledge, threatened, except for assessments that are being contested in good
faith. The accruals and reserves on the books and records of the Company and the
Subsidiaries in respect of tax liabilities for any taxable period not finally
determined are adequate to meet any assessments and related liabilities for any
such period and, since March 31, 2007, the Company and the Subsidiaries have not
incurred any liability for taxes other than in the ordinary course of its
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 or any Subsidiary.
(ff) No labor disturbance by the employees of the Company or any
Subsidiary 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 or any Subsidiary's principal suppliers, manufacturers',
customers or contractors, which, in either case (individually or in the
aggregate), could reasonably be expected to have a Material Adverse Effect.
(gg) No "prohibited transaction" (as defined in either Section 406 of
the Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA") or Section 4975
of the Internal Revenue Code of 1986, as amended from time to time (the
"Code")), "accumulated funding deficiency" (as
10
defined in Section 302 of ERISA) or other event of the kind described in Section
4043(b) of ERISA (other than events with respect to which the 30-day notice
requirement under Section 4043 of ERISA has been waived) has occurred with
respect to any employee benefit plan for which the Company or any Subsidiary
would have any liability which could (individually or in the aggregate)
reasonably be expected to have a Material Adverse Effect; each employee benefit
plan for which the Company or any Subsidiary would have any liability is in
compliance in all material respects with applicable law, including (without
limitation) ERISA and 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, to the knowledge of the Company,
whether by action or by failure to act, which could cause the loss of such
qualification.
(hh) There has been no storage, generation, transportation, handling,
use, treatment, disposal, discharge, emission, contamination, release or other
activity involving any kind of hazardous, toxic or other wastes, pollutants,
contaminants, petroleum products or other hazardous or toxic substances,
chemicals or materials ("Hazardous Substances") by, due to, on behalf of, or
caused by the Company or any Subsidiary (or, to the Company's knowledge, any
other entity for whose acts or omissions the Company is or may be liable) upon
any property now or previously owned, operated, used or leased by the Company or
any Subsidiary, or upon any other property, which would be a violation of or
give rise to any liability under any applicable law, rule, regulation, order,
judgment, decree or permit, common law provision or other legally binding
standard relating to pollution or protection of human health and the environment
("Environmental Law"), except for violations and liabilities which, individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect. There has been no disposal, discharge, emissions, contamination or other
release of any kind at, onto or from any such property or into the environment
surrounding any such property of any Hazardous Substances with respect to which
the Company or any Subsidiary has knowledge, except as could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Neither the Company nor any Subsidiary has 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 as could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect. There is no pending or, to the best of the
Company's knowledge, threatened administrative, regulatory or judicial action,
claim or notice of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any Subsidiary except
as could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. No property of the Company or any Subsidiary is subject
to any Lien under any Environmental Law. Neither the Company nor any Subsidiary
is subject to any order, decree, agreement or other individualized legal
requirement related to any Environmental Law except as could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(ii) None of the Company, any Subsidiary or, to the Company's
knowledge, any of its employees or agents, has at any time during the last five
years (i) made any unlawful contribution to any candidate for foreign office, or
failed to disclose fully any such contribution in violation of law, or (ii) made
any payment to any federal or state governmental officer or official, or other
person charged with similar public or quasi-public duties, other than payments
11
required or permitted by the laws of the United States of any jurisdiction
thereof. The operations of the Company and each Subsidiary 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
body or any arbitrator involving the Company or any Subsidiary with respect to
the Money Laundering Laws is pending or, to the knowledge of the Company,
threatened. Neither the Company nor any Subsidiary nor, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the Company or
any Subsidiary is 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, 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.
(jj) Neither the Company nor any Subsidiary (i) is in violation of its
certificate or articles of incorporation, by-laws, certificate of formation,
limited liability company agreement, partnership agreement or other
organizational documents, (ii) is in default under, and no event has occurred
which, with notice or lapse of time or both, would constitute a default under or
result in the creation or imposition of any Lien upon any property or assets of
the Company or any Subsidiary pursuant to, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its property or assets is subject, or
(iii) is in violation of any statute, law, rule, regulation, ordinance,
directive, judgment, decree or order of any judicial, regulatory or other legal
or governmental agency or body, foreign or domestic, except (in the case clauses
(ii) and (iii) above) for violations or defaults that could not (individually or
in the aggregate) reasonably be expected to have a Material Adverse Effect.
(kk) The Company has complied with the requirements of Rule 433 under
the Securities Act with respect to each Issuer Free Writing Prospectus
including, without limitation, all prospectus delivery, filing, record retention
and legending requirements applicable to any such Issuer Free Writing
Prospectus. The Company has not (i) distributed any offering material in
connection with the Offering other than the Pricing Prospectus, the Prospectus,
and any Issuer Free Writing Prospectus set forth on Annex IV hereto, or (ii)
filed, referred to, approved, used or authorized the use of any "free writing
prospectus" as defined in Rule 405 under the Securities Act with respect to the
Offering or the Shares, except for any Issuer Free Writing Prospectus set forth
in Annex IV hereto and any electronic road show previously approved by Bear
Xxxxxxx.
(ll) The preclinical tests and clinical trials conducted by or on
behalf of the Company that are described in, or the results of which are
referred to in, the Registration Statement, the Pricing Prospectus and the
Prospectus were and, if still pending, are being conducted in accordance with
experimental protocols, procedures and controls filed with the appropriate
regulatory authorities for each such test or trial, as the case may be; the
description of the results of such tests and trials contained in the
Registration Statement, the Pricing Prospectus and the Prospectus are accurate
in all material respects and fairly present the data
12
derived from such tests and trials, and the Company and the Subsidiaries have no
knowledge of any other published or otherwise publicly available studies or
tests the results of which are inconsistent with, or otherwise call into
question, the results described or referred to in the Registration Statement,
the Pricing Prospectus and the Prospectus; neither the Company nor any
Subsidiaries has received any notices or other correspondence from the Food and
Drug Administration of the U.S. Department of Health (the "FDA") and Human
Services or any committee thereof or from any other U.S. or foreign government
or drug or medical device regulatory agency requiring the termination,
suspension or material modification of any clinical trials conducted by or on
behalf of the Company that are described in the Registration Statement, the
Pricing Prospectus and the Prospectus; and the Company and the Subsidiaries have
each operated and currently are in compliance in all material respects with all
applicable rules, regulations and policies of the FDA and comparable foreign
drug or medical device regulatory agencies outside of the United States.
(mm) To the Company's knowledge, except as disclosed in the
Registration Statement, the Pricing Prospectus and the Prospectus, there are no
rulemaking or similar proceedings before the FDA, the U.S. Patent and Trademark
Office or the European Patent Office which affect or involve the Company or any
of the processes or products which the Registration Statement, the Pricing
Prospectus and the Prospectus disclose the Company to have developed, to be
developing or to propose to develop or use or propose to use which, if the
subject of an action unfavorable to the Company, would have a Material Adverse
Effect.
Any certificate signed by or on behalf of the Company and delivered to
the Representatives or to counsel for the Underwriters' shall be deemed to be a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
2. Purchase, Sale and Delivery of the Shares.
(a) On the basis of the representations, warranties, covenants and
agreements herein contained, but subject to the terms and conditions herein set
forth, the Company agrees to sell to each Underwriter and each Underwriter,
severally and not jointly, agrees to purchase from the Company, at a purchase
price per share of $20.735, the number of Firm Shares set forth opposite their
respective names on Schedule I hereto together with any additional number of
Shares which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) Payment of the purchase price for, and delivery of certificates
representing, the Firm Shares shall be made at the office of Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP ("Underwriters' Counsel"), or at such other place as
shall be agreed upon by the Lead Manager and the Company, at 10:00 A.M., New
York City time, on July 23, 2007, or such other time and date as Bear Xxxxxxx
and the Company may agree upon in writing (such time and date of payment and
delivery being herein called the "Closing Date"). Payment of the purchase price
for the Firm Shares shall be made by wire transfer in same day funds to the
Company upon delivery of certificates for the Firm Shares to the Representatives
through the facilities of The Depository Trust Company for the respective
accounts of the several Underwriters. Certificates for the Firm Shares shall be
registered in such name or names and shall be in such denominations
13
as the Lead Manager may request. The Company will permit the Lead Manager to
examine and package such certificates for delivery at least one full business
day prior to the Closing Date.
(c) In addition, on the basis of the representations, warranties,
covenants and agreements herein contained, but subject to the terms and
conditions herein set forth, the Company hereby grants to the Underwriters,
acting severally and not jointly, the option to purchase up to 450,000
Additional Shares at the same purchase price per share to be paid by the
Underwriters for the Firm Shares as set forth in Section 2(a) above, for the
sole purpose of covering over-allotments in the sale of Firm Shares by the
Underwriters. This option may be exercised at any time and from time to time, in
whole or in part on one or more occasions, on or before the thirtieth day
following the date of the Prospectus, by written notice from the Lead Manager to
the Company. Such notice shall set forth the aggregate number of Additional
Shares as to which the option is being exercised and the date and time, as
reasonably determined by Bear Xxxxxxx, when the Additional Shares are to be
delivered (any such date and time being herein sometimes referred to as the
"Additional Closing Date"); provided, however, that no Additional Closing Date
shall occur earlier than the Closing Date or earlier than the second full
business day after the date on which the option shall have been exercised nor
later than the eighth full business day after the date on which the option shall
have been exercised. Upon any exercise of the option as to all or any portion of
the Additional Shares, each Underwriter, acting severally and not jointly,
agrees to purchase from the Company the number of Additional Shares that bears
the same proportion of the total number of Additional Shares then being
purchased as the number of Firm Shares set forth opposite the name of such
Underwriter in Schedule I hereto (or such number increased as set forth in
Section 10 hereof) bears to the total number of Firm Shares that the
Underwriters have agreed to purchase hereunder, subject, however, to such
adjustments to eliminate fractional shares as Bear Xxxxxxx in its sole
discretion shall make.
(d) Payment of the purchase price for, and delivery of certificates
representing, the Additional Shares shall be made at the office of Underwriters'
Counsel, or at such other place as shall be agreed upon by the Lead Manager and
the Company, at 10:00 A.M., New York City time, on the Additional Closing Date,
or such other time as shall be agreed upon by Bear Xxxxxxx and the Company.
Payment of the purchase price for the Additional Shares shall be made by wire
transfer in same day funds to the Company upon delivery of certificates for the
Additional Shares to the Representatives through the facilities of The
Depository Trust Company for the respective accounts of the several
Underwriters. Certificates for the Additional Shares shall be registered in such
name or names and shall be in such denominations as the Lead Manager may
request. The Company will permit the Lead Manager to examine and package such
certificates for delivery at least one full business day prior to the Additional
Closing Date.
(e) The Company acknowledges and agrees that (i) the terms of this
Agreement and the Offering (including the price of the Shares) were negotiated
at arm's length between sophisticated parties represented by counsel; (ii) no
fiduciary, advisory or agency relationship between the Company and the
Underwriters has been created as a result of any of the transactions
contemplated by this Agreement or the process leading to such transactions,
irrespective of whether any Underwriter has advised or is advising any such
party on other matters, (iii) the Underwriters' obligations to the Company in
respect of the Offering are set forth in this Agreement in their entirety and
(iv) it has obtained such legal, tax, accounting and other advice as it deems
appropriate with respect to this Agreement and the transactions contemplated
14
hereby and any other activities undertaken in connection therewith, and it is
not relying on the Underwriters with respect to any such matters.
3. Offering. Upon authorization of the release of the Firm Shares by
the Lead Manager, the Underwriters propose to offer the Shares for sale to the
public upon the terms and conditions set forth in the Prospectus.
4. Covenants of the Company. In addition to the other covenants and
agreements of the Company contained herein, the Company further covenants and
agrees with each of the Underwriters that:
(a) The Company shall prepare the Prospectus in a form approved by you
and file such Prospectus pursuant to, and within the time period specified in,
Rule 424(b) and Rule 430B under the Securities Act; prior to the last date on
which an Additional Closing Date, if any, may occur, the Company shall file no
further amendment to the Registration Statement or amendment or supplement to
the Prospectus to which you shall reasonably object in writing after being
furnished in advance a copy thereof and given a reasonable opportunity to review
and comment thereon; the Company shall notify you promptly (and, if requested by
Bear Xxxxxxx, confirm such notice in writing) (i) when the Registration
Statement and any amendments thereto become effective, (ii) of any request by
the Commission for any amendment of or supplement to the Registration Statement
or the Prospectus or for any additional information, (iii) of 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, (iv) of the mailing or the delivery to the Commission for filing of
any amendment of or supplement to the Registration Statement or the Prospectus,
including but not limited to Rule 462(b) under the Securities Act, (v) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto, or suspending
the use of any Preliminary Prospectus, the Prospectus or any Issuer Free Writing
Prospectus or, in each case, of the initiation or threatening of any proceedings
therefore, (vi) of the receipt of any comments from the Commission, and (vii) of
the receipt by the Company of any notification with respect to the suspension of
the qualification of the Shares for sale in any jurisdiction or the initiation
or threatening of any proceeding for that purpose. If the Commission shall
propose or enter a stop order at any time, the Company will make every effort to
prevent the issuance of any such stop order and, if issued, to obtain the
lifting of such order as soon as possible.
(b) If at any time when a prospectus relating to the Shares (or, in
lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is
required to be delivered under the Securities Act, any event shall have occurred
as a result of which the Pricing Disclosure Package (prior to the availability
of the Prospectus) or the Prospectus as then amended or supplemented would, in
the judgment of the Underwriters or the Company, include an 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, in light of the circumstances
existing at the time of delivery of such Pricing Disclosure Package or
Prospectus (or, in lieu thereof, the notice referred to in Rule 173(a) under the
Securities Act) to the purchaser, not misleading, or if to comply with the
Securities Act, the Exchange Act or the Rules and Regulations it shall be
necessary at any time to amend or supplement the Pricing Disclosure Package, the
Prospectus or the Registration
15
Statement, or to file any document incorporated by reference in the Registration
Statement or the Prospectus or in any amendment thereof or any supplement
thereto, the Company will notify you promptly and prepare and file with the
Commission an appropriate amendment, supplement or document (in form and
substance satisfactory to Bear Xxxxxxx) that will correct such statement or
omission or effect such compliance, and will use its best efforts to have any
amendment to the Registration Statement declared effective as soon as possible.
(c) The Company will not, without the prior consent of Bear Xxxxxxx,
(i) make any offer relating to the Shares that would constitute a "free writing
prospectus" as defined in Rule 405 under the Securities Act, except for any
Issuer Free Writing Prospectus set forth in Annex IV hereto and any electronic
road show previously approved by Bear Xxxxxxx, or (ii) file, refer to, approve,
use or authorize the use of any "free writing prospectus" as defined in Rule 405
under the Securities Act with respect to the Offering or the Shares. If at any
time any event shall have occurred as a result of which any Issuer Free Writing
Prospectus as then amended or supplemented would, in the judgment of the
Underwriters or the Company, conflict with the information in the Registration
Statement, the Pricing Prospectus or the Prospectus as then amended or
supplemented or would, in the judgment of the Underwriters or the Company,
include an 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,
in light of the circumstances existing at the time of delivery to the purchaser,
not misleading, or if to comply with the Securities Act or the Rules and
Regulations it shall be necessary at any time to amend or supplement any Issuer
Free Writing Prospectus, the Company will notify Bear Xxxxxxx promptly and, if
requested by Bear Xxxxxxx, prepare and furnish without charge to each
Underwriter an appropriate amendment or supplement (in form and substance
satisfactory to Bear Xxxxxxx) that will correct such statement, omission or
conflict or effect such compliance.
(d) The Company has complied and will comply with the requirements of
Rule 433 with respect to each Issuer Free Writing Prospectus including, without
limitation, all prospectus delivery, filing, record retention and legending
requirements applicable to each such Issuer Free Writing Prospectus.
(e) The Company will promptly deliver to each of you and Underwriters'
Counsel a signed copy of the Registration Statement, as initially filed and all
amendments thereto, including all consents and exhibits filed therewith, and
will maintain in the Company's files manually signed copies of such documents
for at least five years after the date of filing. The Company will promptly
deliver to each of the Underwriters such number of copies of any Preliminary
Prospectus, the Prospectus, the Registration Statement, any Issuer Free Writing
Prospectus, all amendments of and supplements to such documents, if any, and all
documents incorporated by reference in the Registration Statement and Prospectus
or any amendment thereof or supplement thereto, as you may reasonably request.
Prior to 10:00 A.M., New York time, on the business day next succeeding the date
of this Agreement and from time to time thereafter, the Company will furnish the
Underwriters with copies of the Prospectus in New York City in such quantities
as you may reasonably request.
(f) Promptly from time to time, the Company will use its best efforts,
in cooperation with the Lead Manager, to qualify the Shares for offering and
sale under the securities laws relating to the offering or sale of the Shares of
such jurisdictions, domestic or
16
foreign, as the Lead Manager may designate and to maintain such qualification in
effect for so long as required for the distribution thereof; except that in no
event shall the Company be obligated in connection therewith to qualify as a
foreign corporation or to execute a general consent to service of process.
(g) The Company will make generally available to its security holders
as soon as practicable, but in any event not later than twelve months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Securities Act), an earnings statement of the Company and the Subsidiaries
(which need not be audited) complying with Section 11(a) of the Securities Act
and the Rules and Regulations (including, at the option of the Company, Rule
158).
(h) During the period of 120 days from the date of the Prospectus (the
"Lock-Up Period"), without the prior written consent of Bear Xxxxxxx, the
Company (i) will not, directly or indirectly, issue, offer, sell, agree to
issue, offer or sell, solicit offers to purchase, grant any call option, warrant
or other right to purchase, purchase any put option or other right to sell,
pledge, borrow or otherwise dispose of any Relevant Security, or make any public
announcement of any of the foregoing, (ii) will not establish or increase any
"put equivalent position" or liquidate or decrease any "call equivalent
position" (in each case within the meaning of Section 16 of the Exchange Act and
the Rules and Regulations) with respect to any Relevant Security, and (iii) will
not otherwise enter into any swap, derivative or other transaction or
arrangement that transfers to another, in whole or in part, any economic
consequence of ownership of a Relevant Security, whether or not such transaction
is to be settled by delivery of Relevant Securities, other securities, cash or
other consideration; and the Company will obtain an undertaking in substantially
the form of Annex III hereto of each of its executive officers and directors
listed on Schedule II attached hereto, not to engage in any of the
aforementioned transactions on their own behalf, other than the sale of Shares
as contemplated by this Agreement and the Company's issuance of Common Stock
upon (A) the conversion or exchange of convertible or exchangeable securities
outstanding on the date hereof; (B) the exercise of currently outstanding
options; (C) the exercise of currently outstanding warrants; and (D) the grant
and exercise of options under, or the issuance and sale of shares pursuant to,
employee stock option plans in effect on the date hereof, each as described in
the Registration Statement, the Pricing Prospectus and the Prospectus. The
Company will not file a registration statement under the Securities Act in
connection with any transaction by the Company or any person that is prohibited
pursuant to the foregoing, except for registration statements on Form S-8
relating to employee benefit plans.
Notwithstanding the foregoing, if (1) during the last 17 days of the
Lock-Up Period the Company issues an earnings release or 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
restrictions imposed by the immediately preceding paragraph shall continue to
apply until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event, as
applicable, unless Bear Xxxxxxx waives, in writing, such extension. The Company
will provide the Lead Managers and any co-managers, each executive officer and
director of the Company listed on Schedule II
17
attached hereto with prior notice of any such announcement that gives rise to an
extension of the Lock-Up Period.
(i) During the period of three years from the effective date of the
Registration Statement, the Company will furnish to you copies of all reports or
other communications (financial or other) furnished to security holders or from
time to time published or publicly disseminated by the Company, and will deliver
to you (i) as soon as they are available, copies of any reports, financial
statements and proxy or information statements furnished to or filed with the
Commission or any national securities exchange on which any class of securities
of the Company is listed; and (ii) 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 and the Subsidiaries are consolidated in
reports furnished to its security holders generally or to the Commission).
(j) The Company will use its best efforts to maintain the listing of
the Shares on Nasdaq.
(k) The Company will apply the net proceeds from the sale of the
Shares as set forth under the caption "Use of Proceeds" in the Registration
Statement, the Pricing Prospectus and the Prospectus.
(l) The Company, during the period when a prospectus (or, in lieu
thereof, the notice referred to in Rule 173(a) under the Securities Act) is
required to be delivered under the Securities Act in connection with the offer
or sale of the Shares, will file all reports and other documents required to be
filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act and the Rules and Regulations within the time periods
required thereby.
(m) If the Company elects to rely upon Rule 462(b) under the
Securities Act, the Company shall file a Rule 462(b) Registration Statement with
the Commission in compliance with Rule 462 by 10:00 p.m. (Eastern time), on the
date of this Agreement, and the Company shall at the time of filing either pay
to the Commission the filing fee for the Rule 462 Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Securities Act.
(n) The Company will not take, and will cause its affiliates (within
the meaning of Rule 144 under the Securities Act) not to take, directly or
indirectly, any action which constitutes or is designed to cause or result in,
or which could reasonably be expected to constitute, cause or result in, the
stabilization or manipulation of the price of any security to facilitate the
sale or resale of the Shares.
5. Covenant of the Underwriters. Each Underwriter, severally and not
jointly, covenants and agrees with the Company that such Underwriter will not
use or refer to any "free writing prospectus" (as defined in Rule 405 under the
Securities Act) without the prior written consent of the Company if such
Underwriter's use of or reference to such "free writing
18
prospectus" would require the Company to file with the Commission any "issuer
information" (as defined in Rule 433 under the Securities Act).
6. Payment of Expenses. Whether or not the transactions contemplated
by this Agreement, the Registration Statement and the Prospectus are consummated
or this Agreement is terminated, the Company hereby agrees to pay all costs and
expenses incident to the performance of its obligations hereunder, including the
following: (i) all expenses in connection with the preparation, printing and
filing of the Registration Statement, any Preliminary Prospectus, any Issuer
Free Writing Prospectus, the Prospectus and any and all amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) the fees, disbursements and expenses of the
Company's counsel and accountants in connection with the registration of the
Shares under the Securities Act and the Offering; (iii) the cost of producing
this Agreement and any agreement among Underwriters, blue sky survey, closing
documents and other instruments, agreements or documents (including any
compilations thereof) in connection with the Offering; (iv) all expenses in
connection with the qualification of the Shares for offering and sale under
state or foreign securities or blue sky laws as provided in Section 4(f) hereof,
including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with any blue sky survey;
(v) the filing fees incident to, and the fees and disbursements of counsel for
the Underwriters in connection with, securing any required review by the NASD of
the terms of the Offering; (vi) all fees and expenses in connection with listing
the Shares on the Nasdaq; (vii) all travel expenses of the Company's officers
and employees and any other expense of the Company incurred in connection with
attending or hosting meetings with prospective purchasers of the Shares; and
(viii) any stock transfer taxes incurred in connection with this Agreement or
the Offering. The Company also will pay or cause to be paid: (x) the cost of
preparing stock certificates representing the Shares; (y) the cost and charges
of any transfer agent or registrar for the Shares; and (z) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section 6. It is understood,
however, that except as provided in Sections 8, 9 and 12 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel and stock transfer taxes on resale of any of the Shares by them.
7. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase and pay for the Firm Shares and the Additional
Shares, as provided herein, shall be subject to the accuracy of the
representations and warranties of the Company herein contained, as of the date
hereof and as of the Closing Date (for purposes of this Section 7, "Closing
Date" shall refer to the Closing Date for the Firm Shares and any Additional
Closing Date, if different, for the Additional Shares), to the performance by
the Company of all of its obligations hereunder, and to each of the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission in a
timely fashion in accordance with Section 4(a) hereof; no stop order suspending
the effectiveness of the Registration Statement or any post-effective amendment
thereto, and no stop order suspending or preventing the use of any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the Prospectus, shall have
been issued by the Commission and no proceedings therefor shall have been
initiated or threatened by the Commission; all requests for additional
information on the part of the Commission shall have been complied with to your
reasonable satisfaction; if the
19
Company has elected to rely on Rule 462(b) under the Securities Act, the Rule
462(b) Registration Statement shall have become effective by 10:00 p.m.
(Washington, D.C. time) on the date of this Agreement; and all necessary
regulatory or stock exchange approvals shall have been received.
(b) At the Closing Date you shall have received the written opinion of
XxXxxxxxx Will & Xxxxx LLP, counsel for the Company, dated the Closing Date and
addressed to the Underwriters, in form and substance reasonably satisfactory to
you, to the effect set forth in Annex I hereto.
(c) At the Closing Date you shall have received the written opinion of
Xxxxxxx Xxxxxxx, in-house intellectual property counsel for the Company, dated
the Closing Date and addressed to the Underwriters, in form and substance
satisfactory to you, to the effect set forth in Annex II hereto.
(d) At the Closing Date, you shall have received the written opinion
of Underwriters' Counsel, dated the Closing Date and addressed to the
Underwriters, in form and substance reasonably satisfactory to you, with respect
to the issuance and sale of the Shares, the Registration Statement, the Pricing
Disclosure Package, the Prospectus and such other matters as you may require,
and the Company shall have furnished to Underwriters' Counsel such documents as
they may reasonably request for the purpose of enabling them to pass upon such
matters.
(e) At the Closing Date you shall have received a certificate of the
Chief Executive Officer and Chief Financial Officer of the Company, dated the
Closing Date, in form and substance satisfactory to you, as to the accuracy of
the representations and warranties of the Company set forth in Section 1 hereof
as of the date hereof and as of the Closing Date, as to the performance by the
Company of all of its obligations hereunder to be performed at or prior to the
Closing Date, as to the matters set forth in subsections (a) and (g) of this
Section 7, and as to such other matters as you may reasonably request.
(f) At the time this Agreement is executed and at the Closing Date,
you shall have received a comfort letter, from Deloitte & Touche LLP,
independent public accountants for the Company, dated, respectively, as of the
date of this Agreement and as of the Closing Date, addressed to the Underwriters
and in form and substance satisfactory to the Underwriters and Underwriters'
Counsel.
(g) (i) Neither the Company nor any Subsidiary shall have sustained,
since the date of the latest audited financial statements included or
incorporated by reference in the Pricing Prospectus, 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, other than as
set forth in the Pricing Prospectus (exclusive of any supplement thereto); and
(ii) subsequent to the dates as of which information is given in the
Registration Statement (exclusive of any amendment thereto subsequent to the
date hereof) and the Pricing Prospectus (exclusive of any supplement thereto),
there shall not have been any material change in the capital stock or long-term
or short-term debt of the Company or any Subsidiary or any change or any
development involving a change,
20
whether or not arising from transactions in the ordinary course of business, in
the business, management, condition (financial or otherwise), results of
operations, stockholders' equity, properties or prospects of the Company and the
Subsidiaries, individually or taken as a whole, the effect of which, in any such
case described above, is, in the judgment of the Lead Manager, so material and
adverse as to make it impracticable or inadvisable to proceed with the Offering
on the terms and in the manner contemplated in the Pricing Prospectus (exclusive
of any such supplement).
(h) You shall have received a duly executed lock-up agreement from
each person who is a director or executive officer of the Company listed on
Schedule II hereto, in each case substantially in the form attached hereto as
Annex II.
(i) At the Closing Date, the Shares shall have been approved for
listing on Nasdaq.
(j) At the Closing Date, 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.
(k) The Company shall have furnished the Underwriters and
Underwriters' Counsel with such other certificates, opinions or other documents
as they may have reasonably requested.
If any of the conditions specified in this Section 7 shall not have
been fulfilled when and as required by this Agreement, or if any of the
certificates, opinions, written statements or letters furnished to you or to
Underwriters' Counsel pursuant to this Section 7 shall not be reasonably
satisfactory in form and substance to the Lead Manager and to Underwriters'
Counsel, all obligations of the Underwriters hereunder may be cancelled by the
Lead Manager at, or at any time prior to, the Closing Date and the obligations
of the Underwriters to purchase the Additional Shares may be cancelled by the
Lead Manager at, or at any time prior to, the Additional Closing Date. Notice of
such cancellation shall be given to the Company in writing or by telephone. Any
such telephone notice shall be confirmed promptly thereafter in writing.
8. Indemnification.
(a) The Company shall indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act, and each affiliate
of any Underwriter within the meaning of Rule 405 under the Securities Act from
and against any and all losses, liabilities, claims, damages and expenses
whatsoever as incurred (including but not limited to reasonable attorneys' fees
and any and all reasonable expenses whatsoever incurred in investigating,
preparing or defending against any litigation, commenced or threatened, or any
claim whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon (i) any untrue statement or alleged untrue statement of
a material fact contained in (A) the Registration Statement, as originally
21
filed or any amendment thereof, or in any Preliminary Prospectus, the Pricing
Disclosure Package or the Prospectus, or in any supplement thereto or amendment
thereof, or in any Issuer Free Writing Prospectus, or in any "issuer
information" (as defined in Rule 433(h)(2) under the Securities Act) filed or
required to be filed pursuant to Rule 433(d) under the Securities Act, or (B)
any other materials or information provided to investors by, or with the
approval of, the Company in connection with the Offering, including in any "road
show" (as defined in Rule 433 under the Securities Act) for the Offering
("Marketing Materials"), or (ii) the omission or alleged omission to state (A)
in the Registration Statement, as originally filed or any amendment thereof, a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) in any Preliminary Prospectus, the Pricing
Disclosure Package or the Prospectus, or in any supplement thereto or amendment
thereof, or in any Issuer Free Writing Prospectus, or in any "issuer
information" (as defined in Rule 433(h)(2) under the Securities Act) filed or
required to be filed pursuant to Rule 433(d) under the Securities Act, or in any
Marketing Materials, 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; provided, however, that the Company will not be
liable in any such case to the extent but only to the extent that any such loss,
liability, claim, damage or expense arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Underwriter through Bear Xxxxxxx
expressly for use therein. The parties agree that such information provided by
or on behalf of any Underwriter through Bear Xxxxxxx consists solely of the
material referred to in Section 16 hereof. This indemnity agreement will be in
addition to any liability which the Company may otherwise have, including but
not limited to other liability under this Agreement.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, each of the directors of the Company, each of the
officers of the Company who shall have signed the Registration Statement, and
each other person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, against any
losses, liabilities, claims, damages and expenses whatsoever as incurred
(including but not limited to reasonable attorneys' fees and any and all
reasonable expenses whatsoever incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim whatsoever, and
any and all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims,
damages or expenses (or actions in respect thereof) arise out of or are based
upon (i) any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, as originally filed or any amendment
thereof, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading or (ii) any untrue statement or alleged untrue statement of a
material fact included in any Preliminary Prospectus, the Pricing Disclosure
Package or the Prospectus, or in any amendment thereof or supplement thereto, or
the omission or alleged omission therefrom of 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 any such loss, liability, claim, damage or
expense arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with information furnished in writing to the
22
Company by or on behalf of any Underwriter through Bear Xxxxxxx specifically for
use therein; provided, however, that in no case shall any Underwriter be liable
or responsible for any amount in excess of the underwriting discount applicable
to the Shares to be purchased by such Underwriter hereunder. The parties agree
that such information provided by or on behalf of any Underwriter through Bear
Xxxxxxx consists solely of the material referred to in Section 16 hereof.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of any claims or 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 each party against whom
indemnification is to be sought in writing of the claim or the commencement
thereof (but the failure so to notify an indemnifying party shall not relieve
the indemnifying party from any liability which it may have under this Section
8). In case any such claim or action is brought against any indemnified party,
counsel to such indemnified party shall be selected by such indemnified party.
An indemnifying party may participate at its own expense in the defense of any
such claim or action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of the indemnified party) also be counsel to
the indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened claim, investigation, action
or proceeding in respect of which indemnity or contribution may be or could have
been sought by an indemnified party under this Section 8 or Section 9 hereof
(whether or not the indemnified party is an actual or potential party thereto),
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such claim,
investigation, action or proceeding and (ii) 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. If at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by subsections (a) or (b), as applicable,
effected without its written consent if (A) such settlement is entered into more
than 45 days after receipt by such indemnifying party of the aforesaid request,
(B) such indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and (C)
such indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
9. Contribution. In order to provide for contribution in circumstances
in which the indemnification provided for in Section 8 hereof is for any reason
held to be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified thereunder, the Company and the Underwriters shall
contribute to the aggregate losses, claims, damages, liabilities and expenses of
the nature contemplated by such indemnification provision (including any
investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company, any contribution received by
the Company from persons, other than the Underwriters, who may also
23
be liable for contribution, including persons who control the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
officers of the Company who signed the Registration Statement and directors of
the Company) as incurred to which the Company and one or more of the
Underwriters may be subject, in such proportions 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 or, if such allocation is not
permitted by applicable law, in such proportions as are appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Company on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as (x)
the total proceeds from the Offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company bears to (y)
the underwriting discount or commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The relative
fault of each of the Company and of the Underwriters shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and equitable
if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section. The aggregate amount
of losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 9 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any judicial, regulatory or other legal or
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 9, (i) no Underwriter
shall be required to contribute any amount in excess of the amount by which the
discounts and commissions applicable to the Shares underwritten by it and
distributed to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission and (ii) no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this Section 9,
each person, if any, who controls an Underwriter within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of
any Underwriter within the meaning of Rule 405 under the Securities Act shall
have the same rights to contribution as such Underwriter, and each person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, each officer of the Company who shall
have signed the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company, as applicable, subject in
each case to clauses (i) and (ii) of the immediately preceding sentence. Any
party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in
24
respect of which a claim for contribution may be made against another party or
parties, notify each party or parties from whom contribution may be sought, but
the omission to so notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any obligation it or they may
have under this Section 9 or otherwise. The obligations of the Underwriters to
contribute pursuant to this Section 9 are several in proportion to the
respective number of Shares to be purchased by each of the Underwriters
hereunder and not joint.
10. Underwriter Default.
(a) If any Underwriter or Underwriters shall default in its or their
obligation to purchase Firm Shares or Additional Shares hereunder, and if the
Firm Shares or Additional Shares with respect to which such default relates (the
"Default Shares") do not (after giving effect to arrangements, if any, made by
the Lead Manager pursuant to subsection (b) below) exceed in the aggregate 10%
of the number of Firm Shares or Additional Shares, each non-defaulting
Underwriter, acting severally and not jointly, agrees to purchase from the
Company that number of Default Shares that bears the same proportion of the
total number of Default Shares then being purchased as the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule I hereto bears to
the aggregate number of Firm Shares set forth opposite the names of the
non-defaulting Underwriters, subject, however, to such adjustments to eliminate
fractional shares as the Lead Manager in its sole discretion shall make.
(b) In the event that the aggregate number of Default Shares exceeds
10% of the number of Firm Shares or Additional Shares, as the case may be, the
Lead Manager may in its discretion arrange for itself or for another party or
parties (including any non-defaulting Underwriter or Underwriters who so agree)
to purchase the Default Shares on the terms contained herein. In the event that
within five calendar days after such a default the Lead Manager does not arrange
for the purchase of the Default Shares as provided in this Section 10, this
Agreement or, in the case of a default with respect to the Additional Shares,
the obligations of the Underwriters to purchase and of the Company to sell the
Additional Shares shall thereupon terminate, without liability on the part of
the Company with respect thereto (except in each case as provided in Sections 6,
8, 9, 11 and 12) or the Underwriters, but nothing in this Agreement shall
relieve a defaulting Underwriter or Underwriters of its or their liability, if
any, to the other Underwriters and the Company for damages occasioned by its or
their default hereunder.
(c) In the event that any Default Shares are to be purchased by the
non-defaulting Underwriters, or are to be purchased by another party or parties
as aforesaid, the Lead Manager or the Company shall have the right to postpone
the Closing Date or Additional Closing Date, as the case may be for a period,
not exceeding five business days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus or in
any other documents and arrangements, and the Company agrees to file promptly
any amendment or supplement to the Registration Statement or the Prospectus
which, in the opinion of Underwriters' Counsel, may thereby be made necessary or
advisable. The term "Underwriter" as used in this Agreement shall include any
party substituted under this Section 10 with like effect as if it had originally
been a party to this Agreement with respect to such Firm Shares and Additional
Shares.
25
11. Survival of Representations and Agreements. All representations
and warranties, covenants and agreements of the Underwriters and the Company
contained in this Agreement or in certificates of officers of the Company or any
Subsidiary submitted pursuant hereto, including the agreements contained in
Section 4 and 5, the indemnity agreements contained in Section 8 and the
contribution agreements contained in Section 9, 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 by or on behalf of the
Company, any of its officers and directors or any controlling person thereof,
and shall survive delivery of and payment for the Shares to and by the
Underwriters. The representations contained in Section 1 and the agreements
contained in Sections 6, 8, 9 and 12 through 15 hereof shall survive any
termination of this Agreement, including termination pursuant to Section 10 or
12 hereof.
12. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective when the parties hereto have
executed and delivered this Agreement.
(b) The Lead Manager shall have the right to terminate this Agreement
at any time prior to the Closing Date or to terminate the obligations of the
Underwriters to purchase the Additional Shares at any time prior to the
Additional Closing Date, as the case may be, if, at or after the Applicable
Time, (i) any domestic or international event or act or occurrence has
materially disrupted, or in the opinion of the Lead Manager will in the
immediate future materially disrupt, the market for the Company's securities or
securities in general; or (ii) a suspension or material limitation in trading in
securities generally on the NYSE or Nasdaq shall have occurred; or (iii) a
suspension or material limitation in trading in the Company's securities on
Nasdaq shall have occurred; or (iv) a banking moratorium has been declared by
any state or federal authority or any material disruption in commercial banking
or securities settlement or clearance services shall have occurred; or (v) 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 Securities 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
(vi) in the judgment of the Lead Manager, any Material Adverse Change shall have
occurred since the respective dates as of which information is given in the
Pricing Prospectus; or (vii)(A) there shall have occurred any outbreak or
escalation of hostilities or acts of terrorism involving the United States or
there is a declaration of a national emergency or war by the United States or
(B) there shall have been any other calamity or crisis or any change in
political, financial or economic conditions if the effect of any such event in
(A) or (B), in the judgment of the Lead Manager, makes it impracticable or
inadvisable to proceed with the offering, sale and delivery of the Firm Shares
or the Additional Shares, as the case may be, on the terms and in the manner
contemplated by the Prospectus.
(c) Any notice of termination pursuant to this Section 12 shall be in
writing.
(d) If this Agreement shall be terminated pursuant to any of the
provisions hereof (other than pursuant to Section 10(b) hereof), or if the sale
of the Shares provided for herein is not consummated because any condition to
the obligations of the Underwriters set forth
26
herein is not satisfied or because of any refusal, inability or failure on the
part of the Company to perform any agreement herein or comply with any provision
hereof, the Company will, subject to demand by the Lead Manager, reimburse the
Underwriters for all out-of-pocket expenses (including the fees and expenses of
their counsel), incurred by the Underwriters in connection herewith.
13. Notices. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing, and:
(a) if sent to any Underwriter, shall be mailed, delivered, or faxed
and confirmed in writing, to such Underwriter c/o Bear, Xxxxxxx & Co. Inc., 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Parish, Senior
Managing Director, Equity Transactions Group, with a copy to Underwriter's
Counsel at Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, Attention: Xxxxx X.
Xxxxxxxxxxx, Esq.;
(b) if sent to the Company, shall be mailed, delivered, or faxed and
confirmed in writing to the Company and its counsel at the addresses set forth
in the Registration Statement, Attention: Xxxxxx X. Xxxxxx, Executive Vice
President, Chief Legal Officer and Secretary, with a copy to Xxxx Xxxxxxx,
XxXxxxxxx Will & Xxxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx 00000;
provided, however, that any notice to an Underwriter pursuant to Section 8 shall
be delivered or sent by mail or facsimile transmission to such Underwriter at
its address set forth in its acceptance facsimile to Bear Xxxxxxx, which address
will be supplied to any other party hereto by Bear Xxxxxxx upon request. Any
such notices and other communications shall take effect at the time of receipt
thereof.
14. Parties. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Underwriters and the Company and the controlling
persons, directors, officers, employees and agents referred to in Sections 8 and
9 hereof, and their respective successors and assigns, and no other person shall
have or be construed to have any legal or equitable right, remedy or claim under
or in respect of or by virtue of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the parties hereto and said
controlling persons and their respective successors, officers, directors, heirs
and legal representatives, and it is not for the benefit of any other person,
firm or corporation. The term "successors and assigns" shall not include a
purchaser, in its capacity as such, of Shares from any of the Underwriters.
15. Governing Law and Jurisdiction; Waiver of Jury Trial. 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 jurisdiction of
any court of the State of New York or the United State District Court for the
Southern District 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,
27
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. THE COMPANY (ON BEHALF OF ITSELF
AND, TO THE FULLEST EXTENT PERMITTED BY LAW, ON BEHALF OF ITS RESPECTIVE EQUITY
HOLDERS AND CREDITORS) HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY CLAIM BASED UPON, ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, THE REGISTRATION
STATEMENT AND THE PROSPECTUS.
16. The parties acknowledge and agree that, for purposes of Sections
1(b), 1(c), 1(d) and 8 hereof, the information provided by or on behalf of any
Underwriter consists solely of the material included in the third paragraph
under the caption "Underwriting" in the Prospectus and the paragraph under the
caption "Underwriting - Price Stabilization and Short Positions" in the
Prospectus, but only insofar as such statements relate to the amount of selling
concessions, reallowance and stabilization activities that may be undertaken by
the Underwriters.
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument. Delivery of
a signed counterpart of this Agreement by facsimile transmission shall
constitute valid and sufficient delivery thereof.
18. 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.
19. 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]
28
If the foregoing correctly sets forth your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among us.
Very truly yours,
CLINICAL DATA, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Accepted as of the date first above written
BEAR, XXXXXXX & CO. INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
On behalf of itself and the other
Underwriters named in Schedule I hereto.
SCHEDULE I
Number of Additional
Total Number of Firm Shares to be Purchased if
Underwriter Shares to be Purchased Option is Fully Exercised
----------- ---------------------- --------------------------
Bear, Xxxxxxx & Co. Inc 2,700,000 405,000
Lazard Capital Markets LLC 300,000 45,000
Total ................. 3,000,000 450,000
========= =======
SCHEDULE II
Xxxxxx X. Xxxxxxx
C. Xxxx Xxxxxxxxxx
Xxxxxx X. Xxxxxx
Xxxxx Xxxx, M.D.
Xxxxxx X. Xxxx
Xxxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Xxxxxx X. Xxxxx, M.D.
Xxxxx X. Xxxxx
EXHIBIT A
Subsidiaries
Clinical Data BV
Cogenics, Inc.
Cogenics Genome Express S.A.
Cogenics Icoria, Inc.
Cogenics Lark, Inc.
Electa Lab s.r.l
NovaChem BV
PGxHealth, LLC
Vital Scientific BV
Spectronetics NV
ANNEX I
Form of Opinion of Company Counsel
1. Each of the Company and its U.S. Subsidiaries is validly existing
as a corporation or limited liability company in good standing under the laws of
its jurisdiction of incorporation, with requisite power and authority to own its
properties and conduct its business as described in the Pricing Prospectus. Each
of the Company and its Subsidiaries is qualified and in good standing as a
foreign corporation in each jurisdiction in which the character or location of
its properties (owned, leased or licensed) or the nature or conduct of its
business makes such qualification necessary, except for those failures to be so
qualified or in good standing which do not have a Material Adverse Effect.
2. The Company has an authorized capitalization as set forth in the
Registration Statement, the Pricing Prospectus and the Prospectus. The Shares to
be delivered on the Closing Date and the Additional Closing Date, if any, have
been duly and validly authorized and, when delivered in accordance with the
Underwriting Agreement, will be duly and validly issued, fully paid and
non-assessable and will not have been issued in violation of or subject to
preemptive or, to the best of such counsel's knowledge, similar rights that
entitle or will entitle any person to acquire any Shares from the Company upon
issuance or sale thereof. All of the issued shares of capital stock of each
Subsidiary of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable and are owned directly or indirectly by the
Company, free and clear of all Liens. The Common Stock, the Firm Shares and the
Additional Shares conform to the descriptions thereof contained in the
Registration Statement, the Pricing Prospectus and the Prospectus.
3. The Common Stock currently outstanding is listed, and the Shares
are duly authorized for listing on the NASDAQ.
4. The Underwriting Agreement has been duly and validly authorized,
executed and delivered by the Company.
5. To the best of such counsel's knowledge and other than as set forth
in the Registration Statement, the Pricing Prospectus and the Prospectus, there
are no judicial, regulatory or other legal or governmental proceedings pending
to which the Company or any of its Subsidiaries is a party or of which any
property of the Company or any of its Subsidiaries is the subject which, if
determined adversely to the Company or any of its Subsidiaries, 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.
6. The execution, delivery, and performance of the Underwriting
Agreement by the Company and consummation by the Company of the transactions
contemplated by Underwriting Agreement do not and will not (A) conflict with or
result in a breach of any of the terms and provisions of, or constitute a
default (or an event which with notice or lapse of time, or both, would
constitute a default) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any of
its Subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan
agreement or any other agreement or instrument
1
known to such counsel to which the Company or any of its Subsidiaries is a party
or by which any of the Company or any of its Subsidiaries or their respective
properties or assets may be bound and which is listed as an exhibit to the
Company's most recently filed 10-K or (B) violate any provision of the
certificate of incorporation or by-laws of the Company or any of its
Subsidiaries, or, to the best knowledge of such counsel, any judgment, decree,
order, statute, rule or regulation of any court or any judicial, regulatory or
other legal or governmental agency or body.
7. No consent, approval, authorization, order, registration, filing,
qualification, license or permit of or with any court or any judicial,
regulatory or other legal or governmental agency or body is required for the
execution, delivery and performance by the Company of this Agreement or
consummation of the transactions contemplated by the Underwriting Agreement,
except for (1) such as may be required under state securities or blue sky laws
in connection with the purchase and distribution of the Shares by the
Underwriters (as to which such counsel need express no opinion), (2) such as
have been made or obtained under the Securities Act, (3) such as would not have
a Material Adverse Effect if not obtained or made, and (4) such as are required
by the NASD.
8. The Registration Statement, the Pricing Prospectus and the
Prospectus and any amendments thereof or supplements thereto (other than the
financial statements and schedules and other financial data included or
incorporated by reference therein, as to which no opinion need be rendered)
comply as to form in all material respects with the requirements of the
Securities Act, the Exchange Act and the Rules and Regulations. The documents
incorporated by reference in the Registration Statement, the Pricing Prospectus
and the Prospectus or any amendment thereof or supplement thereto (other than
the financial statements and schedules and other financial data included or
incorporated by reference therein, as to which no opinion need be rendered) when
they became effective or were filed with the Commission, as the case may be,
complied as to form in all material respects with the Securities Act or the
Exchange Act, as applicable, and the Rules and Regulations.
9. The statements under the captions "Description of Capital Stock"
and "Underwriting" in the Pricing Prospectus and the Prospectus and Items 14 and
15 of Part II of the Registration Statement, insofar as such statements
constitute a summary of the legal matters, documents or proceedings referred to
therein, fairly present in all material respects the information called for with
respect to such legal matters, documents and proceedings.
10. The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described in
the Pricing Prospectus and the Prospectus, will not be, required to register as
an "investment company" as such term is defined in the Investment Company Act of
1940, as amended.
11. The Registration Statement was declared effective under the
Securities Act on June 28, 2007 and, to the best knowledge of such counsel, no
stop order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereof has been issued and no proceedings therefor
have been initiated or threatened by the Commission and all filings required by
Rule 424(b), Rule 430A and Rule 433 under the Securities Act have been made in
the manner and in the time period required therein.
2
12. To the best knowledge of such counsel, no contract or agreement is
required to be filed as an exhibit to the Registration Statement that is not so
filed.
In addition, such opinion shall also contain a statement that such
counsel has participated in conferences with officers and representatives of the
Company, representatives of the independent public accountants for the Company
and the Underwriters at which the contents of the Registration Statement, the
Pricing Prospectus and the Prospectus and related matters were discussed and no
facts have come to the attention of such counsel which lead such counsel to
believe that (A) the Registration Statement, at the time it became effective
(including the information deemed to be part of the Registration Statement at
the time of effectiveness pursuant to Rule 430A(b)), or any amendment thereof
made prior to the Closing Date, as of the date of such amendment, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, or (B) the Prospectus, as of its date (or any amendment thereof or
supplement thereto made prior to the Closing Date as of the date of such
amendment or supplement) and as of the Closing Date, 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; or (C)
the Pricing Disclosure Package, as of the Applicable Time and as of the Closing
Date, 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 (it being understood that such counsel need express no
belief or opinion with respect to the financial statements and schedules and
other financial data included or incorporated by reference therein).
3
ANNEX II
Form of Opinion of Intellectual Property Counsel
1. To the best of our knowledge, the information in the Registration
Statement, the Pricing Prospectus and the Prospectus under "Risk
Factors-Risks Related to Our Intellectual Property," and
"Business-Intellectual Property" to the extent that it constitutes matters
of law, summaries of legal matters, documents or proceedings, or legal
conclusions, has been reviewed by us and is correct in all material
respects and fairly and correctly presents the information called for with
respect thereto.
2. To the best of our knowledge, there are no pending or threatened legal or
governmental proceedings, nor allegations on the part of any person of
infringement, relating to patent rights, trade secrets, trademarks, service
marks, copyrights or other proprietary information or know-how of the
Company and no such proceedings are threatened or contemplated.
3. To the best of our knowledge, the Company is not infringing or otherwise
violating any patents, trade secrets, trademarks, service marks, copyrights
or other proprietary information or know-how of any persons and, to our
knowledge, no person is infringing or otherwise violating any of the
Company's patents, trade secrets, trademarks, service marks, copyrights or
other proprietary information or know-how of the Company.
4. To the best of our knowledge, the Company owns or possesses sufficient
licenses or other rights to use all technology covered by patents or trade
secrets, and to use all trademarks, service marks or other proprietary
information or know-how necessary to conduct the business now being or
proposed to be conducted by the Company as described in the Registration
Statement, the Pricing Prospectus and the Prospectus.
5. To the best of our knowledge, all pertinent art references known to the
Company or their counsel during the prosecution of the patents and the
applications described in the Registration Statement, the Pricing
Prospectus and the Prospectus were disclosed to the PTO and, to the best of
our knowledge, neither such counsel nor the Company made any
misrepresentation to, or concealed any material fact from, the PTO during
such prosecution.
6. We are not aware of any fact with respect to any patent applications that
(i) would preclude the issuance of patents with respect to such
applications described in the Registration Statement, the Pricing
Prospectus and the Prospectus, (ii) would lead us to conclude that such
patents, when issued, would not be valid and enforceable in accordance with
applicable regulations or (iii) would result in a third party having any
rights in any patents issuing from such patent applications.
7. To the best of our knowledge, the Company takes security measures adequate
to assert trade secret protection in its non-patented technology.
8. Nothing has come to our attention that leads us to believe that, with
respect to licenses, patents, trademarks, service marks, trade secrets,
copyrights or other proprietary information
or know-how owned or used by the Company which are the subject of the
foregoing opinions, (A) the Registration Statement, at the time it became
effective (including the information deemed to be part of the Registration
Statement at the time of effectiveness pursuant to Rule 430A(b)), or any
amendment thereof made prior to the Closing Date, as of the date of such
amendment, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading, or (B) the Prospectus, as of its
date (or any amendment thereof or supplement thereto made prior to the
Closing Date as of the date of such amendment or supplement) and as of the
Closing Date, 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; or (C) the
Pricing Disclosure Package, as of the Applicable Time and as of the Closing
Date, 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.
ANNEX III
Form of Lock-Up Agreement
[Date]
Bear, Xxxxxxx & Co. Inc.
As Representative of the several
Underwriters referred to below
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Equity Transactions Group
Clinical Data, Inc. Lock-Up Agreement
Ladies and Gentlemen:
This letter agreement (this "Agreement") relates to the proposed public
offering (the "Offering") by Clinical Data, Inc., a Delaware corporation (the
"Company"), of its common stock, $.01 par value (the "Stock").
In order to induce you and the other underwriters for which you act as
representative (the "Underwriters") to underwrite the Offering, the undersigned
hereby agrees that, without the prior written consent of Bear, Xxxxxxx & Co.
Inc. ("Bear Xxxxxxx"), during the period from the date hereof until one hundred
eighty (180) days from the date of the final prospectus for the Offering (the
"Lock-Up Period"), the undersigned (a) will not, directly or indirectly, offer,
sell, agree to offer or sell, solicit offers to purchase, grant any call option
or purchase any put option with respect to, pledge, borrow or otherwise dispose
of any Relevant Security (as defined below), and (b) will not establish or
increase any "put equivalent position" or liquidate or decrease any "call
equivalent position" with respect to any Relevant Security (in each case within
the meaning of Section 16 of the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder), or otherwise enter into
any swap, derivative or other transaction or arrangement that transfers to
another, in whole or in part, any economic consequence of ownership of a
Relevant Security, whether or not such transaction is to be settled by delivery
of Relevant Securities, other securities, cash or other consideration. As used
herein "Relevant Security" means the Stock, any other equity security of the
Company or any of its subsidiaries and any security convertible into, or
exercisable or exchangeable for, any Stock or other such equity security.
Notwithstanding the preceding paragraph, if (1) during the last 17 days of
the Lock-Up Period the Company issues an earnings release or 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
restrictions imposed by the immediately preceding paragraph shall continue to
apply until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event, as
applicable, unless
Bear Xxxxxxx waives, in writing, such extension. The undersigned acknowledges
that the Company has agreed in the underwriting agreement for the Offering to
provide notice to the undersigned of any event that would result in an extension
of the Lock-Up Period pursuant to this paragraph, and the undersigned agrees
that any such notice properly delivered will be deemed to have been given to,
and received by, the undersigned.
The undersigned hereby authorizes the Company during the Lock-Up Period to
cause any transfer agent for the Relevant Securities to decline to transfer, and
to note stop transfer restrictions on the stock register and other records
relating to, Relevant Securities for which the undersigned is the record holder
and, in the case of Relevant Securities for which the undersigned is the
beneficial but not the record holder, agrees during the Lock-Up Period to cause
the record holder to cause the relevant transfer agent to decline to transfer,
and to note stop transfer restrictions on the stock register and other records
relating to, such Relevant Securities. The undersigned hereby further agrees
that, without the prior written consent of Bear Xxxxxxx, during the Lock-up
Period the undersigned (x) will not file or participate in the filing with the
Securities and Exchange Commission of any registration statement, or circulate
or participate in the circulation of any preliminary or final prospectus or
other disclosure document with respect to any proposed offering or sale of a
Relevant Security and (y) will not exercise any rights the undersigned may have
to require registration with the Securities and Exchange Commission of any
proposed offering or sale of a Relevant Security.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Agreement and that this Agreement
constitutes the legal, valid and binding obligation of the undersigned,
enforceable in accordance with its terms. Upon request, the undersigned will
execute any additional documents necessary in connection with enforcement
hereof. Any obligations of the undersigned shall be binding upon the successors
and assigns of the undersigned from the date first above written.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York. Delivery of a signed copy of this letter by
facsimile transmission shall be effective as delivery of the original hereof.
Very truly yours,
By:
------------------------------------
Print Name:
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ANNEX IV
Issuer Free Writing Prospectuses included in the Pricing Disclosure Package
None.
