PURCHASE AGREEMENT
Exhibit 1.1
_____ Shares1
Alexza Pharmaceuticals, Inc.
Common Stock
_____________________, 2006
XXXXX XXXXXXX & CO.
PACIFIC GROWTH EQUITIES, LLC
RBC CAPITAL MARKETS CORPORATION
JMP SECURITIES LLC
As Representatives of the several
Underwriters named in Schedule I hereto
c/o Xxxxx Xxxxxxx & Co.
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
PACIFIC GROWTH EQUITIES, LLC
RBC CAPITAL MARKETS CORPORATION
JMP SECURITIES LLC
As Representatives of the several
Underwriters named in Schedule I hereto
c/o Xxxxx Xxxxxxx & Co.
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Ladies and Gentlemen:
Alexza Pharmaceuticals, Inc., a Delaware corporation (the “Company") proposes to sell to the
several Underwriters named in Schedule I hereto (the “Underwriters”) an aggregate of ______
shares (the “Firm Shares”) of Common Stock, $0.0001 par value per share (the “Common Stock”),
of the Company. The Firm Shares consist of ______ authorized but unissued shares of
Common Stock to be issued and sold by the Company. The Company has also granted to the several
Underwriters an option to purchase up to ______ additional shares of Common Stock on the
terms and for the purposes set forth in Section 3 hereof (the “Option Shares”). The Firm Shares
and any Option Shares purchased pursuant to this Purchase Agreement are herein collectively called
the “Securities.”
The Company hereby confirms its agreement with respect to the sale of the Securities to the
several Underwriters, for whom you are acting as representatives (the “Representatives”).
1. Registration Statement and Prospectus. A registration statement on Form S-1 (File No.
333-___) with respect to the Securities, including a preliminary form of prospectus, has
been prepared by the Company in conformity with the requirements of the Securities Act of 1933, as
amended (the “Act”), and the rules and regulations (“Rules and
| 1 | Plus an option to purchase up to ___ additional shares to cover over-allotments. |
Regulations”) of the Securities and Exchange Commission (the “Commission”) thereunder and has
been filed with the Commission; one or more amendments to such registration statement have also
been so prepared and have been, or will be, so filed; and, if the Company has elected to rely upon
Rule 462(b) of the Rules and Regulations (“Rule 462(b)”) to increase the size of the offering
registered under the Act, the Company will prepare and file with the Commission a registration
statement with respect to such increase pursuant to Rule 462(b). Copies of such registration
statement(s) and amendments and each related preliminary prospectus have been delivered to you.
If the Company has elected not to rely upon Rule 430A of the Rules and Regulations, (“Rule
430A”) the Company has prepared and will promptly file an amendment to the registration statement
and an amended prospectus. If the Company has elected to rely upon Rule 430A, it will prepare and
file a prospectus pursuant to Rule 424(b) of the Rules and Regulations (“Rule 424(b)”) that
discloses the information previously omitted from the prospectus in reliance upon Rule 430A. Each
part of such registration statement as amended at the time it is or was declared effective by the
Commission, and, in the event of any amendment thereto after the effective date, each part of such
registration statement as so amended (but only from and after the effectiveness of such amendment,
or the date it is first used after effectiveness of the registration statement, in the case of
information contained in a form of prospectus filed with the Commission pursuant to Rule 424(b) and
deemed to be part of the registration statement pursuant to Rule 430C of the Rules and Regulations
(“Rule 430C”)), including a registration statement (if any) filed pursuant to Rule 462(b)
increasing the size of the offering registered under the Act, information (if any) deemed to be
part of the registration statement at the time of effectiveness pursuant to Rule 430A(b) and
information (if any) contained in a form of prospectus required to be filed with the Commission
pursuant to Rule 424(b) and deemed to be part of and included in the registration statement on the
date it is first used after effectiveness in accordance with Rule 430C, is hereinafter called the
“Registration Statement.” The prospectus included in the Registration Statement at the time it is
or was declared effective by the Commission is hereinafter called the “Prospectus,” except that if
any prospectus filed by the Company with the Commission pursuant to Rule 424(b) or any other such
prospectus provided to the Underwriters by the Company for use in connection with the offering of
the Securities (whether or not required to be filed by the Company with the Commission pursuant to
Rule 424(b)) but not including a “free writing prospectus” as defined in Rule 405 of the Rules and
Regulations (“Rule 405”) differs from the prospectus on file at the time the Registration Statement
is or was declared effective by the Commission, the term “Prospectus” shall refer to such differing
prospectus from and after the time such prospectus is filed with the Commission or transmitted to
the Commission for filing pursuant to such Rule 424(b) or from and after the time of its first use
within the meaning of the Rules and Regulations. The term “Preliminary Prospectus” as used herein
means the preliminary prospectus included in the Registration Statement prior to the time it
becomes or became effective under the Act and subject to completion as described in Rule 430A in
the form first used to make offers and included in the Registration Statement filed on __________________, 2006.
All references in this Agreement to amendments or supplements to the Registration Statement or the
Prospectus shall be deemed to include the filing of any prospectus supplement pursuant to Rule
424(b).
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2. Representations and Warranties of the Company.
(a) The Company represents and warrants to, and agrees with, the several Underwriters as
follows:
(i) No order preventing or suspending the use of any Preliminary Prospectus has been
issued by the Commission and the Preliminary Prospectus, at the time of filing thereof or
the time of first use within the meaning of the Rules and Regulations, complied in all
material respects with the applicable requirements of the Securities Act and the Rules and
Regulations and did not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading; except that the
foregoing shall not apply to statements in or omissions from any Preliminary Prospectus in
reliance upon, and in conformity with, written information furnished to the Company by you,
or by any Underwriter through you, specifically for use in the preparation thereof.
(ii) As of the time any part of the Registration Statement (or any post-effective
amendment thereto, including a registration statement (if any) filed pursuant to Rule 462(b)
increasing the size of the offering registered under the Act) became effective, upon the
filing or first use within the meaning of the Rules and Regulations of the Prospectus (or
any supplement to the Prospectus) and at the First Closing Date and Second Closing Date (as
hereinafter defined), (A) the Registration Statement and the Prospectus (in each case, as so
amended and/or supplemented) conformed or will conform in all material respects to the
requirements of the Act and the Rules and Regulations, (B) the Registration Statement (as so
amended) did not or will not include an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the statements therein
not misleading, and (C) the Prospectus (as so supplemented) did not or will not include an
untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the circumstances in which
they are or were made, not misleading; except that each of the foregoing shall not apply to
statements in or omissions from any such document in reliance upon, and in conformity with,
written information furnished to the Company by you, or by any Underwriter through you,
specifically for use in the preparation thereof. If the Registration Statement has been
declared effective by the Commission, no stop order suspending the effectiveness of the
Registration Statement has been issued, and, to the Company’s knowledge, no proceeding for
that purpose has been initiated or threatened by the Commission.
(iii) The Issuer-Represented General Free Writing Prospectus(es) issued on or after the
date of the Preliminary Prospectus and at or prior to the Time of Sale and the Statutory
Prospectus, all considered together (collectively, the “Time of Sale Disclosure Package”),
does not include and did not include as of the Time of
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Sale any untrue statement of a material fact or omit or omitted as of the Time of Sale
to state any material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. The preceding sentence
does not apply to statements in or omissions from any Statutory Prospectus included in the
Registration Statement or any Issuer-Represented Free Writing Prospectus based upon and in
conformity with written information furnished to the Company by you or by any Underwriter
through you specifically for use therein. As used in this paragraph and elsewhere in this
Agreement:
(1) “Time of Sale” means ___:00 **[a/p]m (Eastern time) on the date of this
Agreement
(2) “Statutory Prospectus” as of any time means the prospectus that is included
in the Registration Statement immediately prior to the Time of Sale. For purposes
of this definition, information contained in a form of prospectus that is deemed
retroactively to be a part of the Registration Statement pursuant to Rule 430A shall
be considered to be included in the Statutory Prospectus as of the actual time that
form of prospectus is filed with the Commission pursuant to Rule 424(b).
(3) “Issuer-Represented Free Writing Prospectus” means any “issuer free writing
prospectus,” as defined in Rule 433 of the Rules and Regulations (“Rule 433”),
relating to the Securities that (A) is required to be filed with the Commission by
the Company, or (B) is exempt from filing pursuant to Rule 433(d)(5)(i) because it
contains a description of the Securities or of the offering that does not reflect
the final terms or pursuant to Rule 433(d)(8)(ii) because it is a “bona fide
electronic road show,” as defined in Rule 433 which is made available by the Company
without restriction, in each case in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the Company’s
records pursuant to Rule 433(g).
(4) “Issuer-Represented General Free Writing Prospectus” means any
Issuer-Represented Free Writing Prospectus that is intended for general distribution
to prospective investors, as evidenced by its being specified in Schedule II to this
Agreement, and does not include a “bona fide electronic road show,” as defined in
Rule 433.
(5) “Issuer-Represented Limited-Use Free Writing Prospectus” means any
Issuer-Represented Free Writing Prospectus that is not an Issuer-Represented General
Free Writing Prospectus. The term Issuer-Represented Limited-Use Free Writing
Prospectus also includes any “bona fide electronic road show,” as defined in Rule
433, that is made available without restriction pursuant to Rule 433(d)(8)(ii), even
though not required to be filed with the Commission.
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(iv) (A) Each Issuer-Represented Free Writing Prospectus, as of its issue date and at
all subsequent times through the completion of the public offer and sale of the Securities
or until any earlier date that the issuer notified or notifies the Representatives as
described in Section 4(a)(iii)(B), did not, does not and will not include any information
that conflicted, conflicts or will conflict with the information contained in the
Registration Statement. The foregoing sentence does not apply to statements in or omissions
from any Issuer-Represented Free Writing Prospectus based upon and in conformity with
written information furnished to the Company by you or by any Underwriter through you
specifically for use therein.
(B) (1) At the time of filing the Registration Statement and (2) at the date hereof,
the Company was not and is not an “ineligible issuer,” as defined in Rule 405, including the
Company in the preceding three years not having been convicted of a felony or misdemeanor or
having been made the subject of a judicial or administrative decree or order as described in
Rule 405, nor an “excluded issuer” as defined in Rule 164 of the Rules and Regulations
(“Rule 164”).
(C) Each Issuer-Represented Free Writing Prospectus satisfied, as of its issue date and
at all subsequent times through the completion of the public offer and sale of the
Securities, all other conditions to use thereof as set forth in Rules 164 and 433.
(v) The financial statements of the Company, together with the related notes, set forth
in the Registration Statement, the Time of Sale Disclosure Package and Prospectus comply in
all material respects with the requirements of the Act and fairly present the financial
condition of the Company as of the dates indicated and the results of operations and changes
in cash flows for the periods therein specified in conformity with generally accepted
accounting principles in the United States consistently applied throughout the periods
involved; and the other financial information included in the Registration Statement, the
Time of Sale Disclosure Package and Prospectus present fairly the information shown thereby.
No other financial statements or financial information is required to be included in the
Registration Statement, the Time of Sale Disclosure Package or the Prospectus. Ernst &
Young LLP, which has expressed its opinion with respect to the financial statements filed as
a part of the Registration Statement and included in the Registration Statement, the Time of
Sale Disclosure Package and the Prospectus, is (x) an independent public accounting firm
within the meaning of the Act and the Rules and Regulations, (y) a registered public
accounting firm (as defined in Section 2(a)(12) of the Xxxxxxxx-Xxxxx Act of 2002 (the
“Xxxxxxxx-Xxxxx Act”)) and (z) not in violation of the auditor independence requirements of
the Xxxxxxxx-Xxxxx Act. Except as disclosed in the Registration Statement, the Time of Sale
Disclosure Package and the Prospectus, there are no material off-balance sheet transactions,
arrangements, obligations (including contingent obligations), or any other relationships
with unconsolidated entities or other persons, that may have a material current or, to the
Company’s knowledge, future effect on the Company’s financial condition, results of
operations, liquidity,
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capital expenditures, capital resources or significant components of revenue or
expenses.
(vi) The Company has been duly organized and is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation. The Company has full
corporate power and authority to own its properties and conduct its business as currently
being conducted and as described in the Registration Statement, the Time of Sale Disclosure
Package and Prospectus, and is duly qualified to do business as a foreign corporation in
good standing in each jurisdiction in which it owns or leases real property or in which the
conduct of its business makes such qualification necessary and in which the failure to so
qualify would reasonably be expected to have a material adverse effect upon, or change in,
the general affairs, business, prospects, properties, operations, condition (financial or
otherwise) or results of operations of the Company (“Material Adverse Effect” or “Material
Adverse Change”).
(vii) Except as disclosed in the Time of Sale Disclosure Package and in the Prospectus,
subsequent to the respective dates as of which information is given in the Time of Sale
Disclosure Package, the Company has not incurred any material liabilities or obligations,
direct or contingent, or entered into any material transactions, or declared or paid any
dividends or made any distribution of any kind with respect to its capital stock; and there
has not been any change in the capital stock (other than a change in the number of
outstanding shares of Common Stock due to the issuance of shares upon the exercise of
outstanding options or warrants), or any material change in the short-term or long-term
debt, or any issuance of options, warrants, convertible securities or other rights to
purchase the capital stock (other than grants of stock options under the Company’s stock
option plans existing on the date hereof) of the Company, or any Material Adverse Change.
(viii) Except as disclosed in the Time of Sale Disclosure Package and the Prospectus,
there is not pending or, to the knowledge of the Company, threatened or contemplated, any
action, suit or proceeding to which the Company is a party or of which any property or
assets of the Company is the subject before or by any court or Governmental Authority (as
defined below), or any arbitrator, which, individually or in the aggregate, would reasonably
be expected to result in any Material Adverse Change. There are no actions, suits or
proceedings to which the Company is a party or of which any property or assets of the
Company is the subject that are required to be disclosed in the Registration Statement, Time
of Sale Disclosure Package and Prospectus by the Act or by the Rules and Regulations that
have not been so disclosed.
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(ix) There are no statutes or regulations applicable to the Company, or contracts or
documents of the Company that are required to be described in the Registration Statement,
the Time of Sale Disclosure Package and the Prospectus or be filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations that have not been so
described or filed.
(x) This Agreement has been duly authorized, executed and delivered by the Company, and
constitutes a valid, legal and binding obligation of the Company, enforceable in accordance
with its terms, except as rights to indemnity hereunder may be limited by federal or state
securities laws and except as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the rights of creditors generally and subject to
general principles of equity. The execution, delivery and performance of this Agreement and
the consummation of the transactions herein contemplated will not (i) result in a breach or
violation of any of the terms or provisions of, or constitute a default under, or result in
the creation or imposition of any lien, charge or encumbrance upon any property or assets of
the Company pursuant to any agreement or instrument to which the Company is a party or by
which the Company is bound or to which any of the property or assets of the Company is
subject, (ii) result in any violation of the provisions of the Company’s charter or by laws
or (iii) result in the violation of any law or statute, or any order, rule, regulation,
judgment or decree of any court or arbitrator or federal, state, local or foreign
governmental agency or regulatory authority having jurisdiction over the Company or any of
its properties or assets (each, a “Governmental Authority”). No consent, approval,
authorization or order of, or filing with, any court or Governmental Authority is required
for the execution, delivery and performance of this Agreement or for the consummation of the
transactions contemplated hereby, including the issuance or sale of the Securities by the
Company, except such as may be required under the Act, the rules of the National Association
of Securities Dealers, Inc. or state securities or blue sky laws; and the Company has full
power and authority to enter into this Agreement and to authorize, issue and sell the
Securities as contemplated by this Agreement.
(xi) All of the issued and outstanding shares of capital stock of the Company,
including the outstanding shares of Common Stock, are duly authorized and validly issued,
fully paid and nonassessable, have been issued in compliance with all federal and state
securities laws, were not issued in violation of or subject to any preemptive rights or
other rights to subscribe for or purchase securities that have not been waived in writing (a
copy of which has been delivered to counsel to the Representatives), and the holders thereof
are not subject to personal liability by reason of being such holders; the Securities which
may be sold hereunder by the Company have been duly authorized and, when issued, delivered
and paid for in accordance with the terms of this Agreement, will have been validly issued
and will be fully paid and nonassessable, and the holders thereof will not be subject to
personal liability by reason of being such holders; and the capital stock of the Company,
including the Common Stock, conforms to the description thereof in the Registration
Statement, in the Time of Sale Disclosure Package and in the Prospectus.
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Except as otherwise disclosed in the Registration Statement, the Time of Sale
Disclosure Package and the Prospectus, there are no preemptive rights or other rights to
subscribe for or to purchase, or any restriction upon the voting or transfer of, any shares
of Common Stock pursuant to the Company’s charter, by-laws or any agreement or other
instrument to which the Company is a party or by which the Company is bound. Neither the
filing of the Registration Statement nor the offering or sale of the Securities as
contemplated by this Agreement gives rise to any rights for or relating to the registration
of any shares of Common Stock or other securities of the Company that have not been waived
in writing (a copy of which has been delivered to counsel to the Representatives). Except
as disclosed in the Registration Statement, in the Time of Sale Disclosure Package and in
the Prospectus, there are no options, warrants, agreements, contracts or other rights in
existence to purchase or acquire from the Company any shares of the capital stock of the
Company (other than options to purchase common stock granted pursuant to the Company’s stock
option plans existing on the date hereof subsequent to the dates set forth therein). The
Company has an authorized and outstanding capitalization as set forth in the Registration
Statement, the Time of Sale Disclosure Package and the Prospectus.
(xii) The Company possesses all licenses, certificates, permits and other
authorizations issued by, and have made all declarations and filings with, the appropriate
Governmental Authorities that are necessary for the ownership or lease of its properties or
the conduct of its business; the Company has not received notice of any revocation or
modification of any such license, certificate, permit or authorization and have no reason to
believe that any such license, certificate, permit or authorization will not be renewed in
the ordinary course; and the Company is are in compliance in all material respects with all
applicable federal, state, local and foreign laws, regulations, orders and decrees.
(xiii) The Company has good and marketable title to all property (whether real or
personal) described in the Registration Statement, the Time of Sale Disclosure Package and
the Prospectus as being owned by it, in each case free and clear of all liens, claims,
security interests, other encumbrances or defects except such as are disclosed in the
Registration Statement the Time of Sale Disclosure Package and the Prospectus. The property
held under lease by the Company is held by it under valid, subsisting and enforceable leases
with only such exceptions with respect to any particular lease as do not interfere in any
material respect with the conduct of the business of the Company.
(xiv) Except as disclosed in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus, the Company owns, possesses or can acquire on reasonable terms
all Intellectual Property (as defined below) necessary for the conduct of the business of
the Company as now conducted or as described in the Registration Statement, the Time of Sale
Disclosure Package and the Prospectus to be conducted, except to the extent such failure to
own, possess or acquire such Intellectual Property would not result in a Material Adverse
Change. Except as
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disclosed in the Registration Statement, the Time of Sale Disclosure Package and the
Prospectus under the caption “Business-Patents and Proprietary Rights,” (i) to the knowledge
of the Company, there is no infringement, misappropriation or violation by third parties of
any such Intellectual Property; (ii) there is no pending or, to the knowledge of the
Company, threatened action, suit, proceeding or claim by others challenging the rights of
the Company in or to any such Intellectual Property, and the Company is unaware of any facts
which would support any such claim; (iii) the Intellectual Property owned by the Company
and, to the knowledge of the Company, the Intellectual Property licensed to the Company have
not been adjudged invalid or unenforceable, in whole or in part, and there is no pending or,
to the knowledge of the Company, threatened action, suit, proceeding or claim by others
challenging the validity or scope of any such Intellectual Property, and the Company is
unaware of any facts which would support any such claim; (iv) there is no pending or, to the
knowledge of the Company, threatened action, suit, proceeding or claim by others that the
Company infringes, misappropriates or otherwise violates any Intellectual Property or other
proprietary rights of others, the Company has not received any written notice of such claim
and the Company has no reason to believe that the conduct of its business conflicts with any
such Intellectual Property or proprietary rights of others; and (v) to the Company’s
knowledge, no employee of the Company is in or has ever been in violation of any material
term of any employment contract, patent disclosure agreement, invention assignment
agreement, non-competition agreement, non-solicitation agreement, nondisclosure agreement or
any restrictive covenant to or with a former employer where the basis of such violation
relates to such employee’s employment with the Company, or actions undertaken by the
employee while employed with the Company. The term “Intellectual Property” as used herein
means patents, patent applications, trade and service marks, trade and service xxxx
registrations, trade names, copyrights, licenses, inventions, trade secrets, technology,
know-how and other intellectual property.
(xv) The Company is not (a) in violation of its charter or by-laws; (b) in breach of or
otherwise in default, and no event has occurred which, with notice or lapse of time or both,
would constitute such a default in the performance or observance of any material term,
covenant, obligation, agreement or condition contained in any bond, debenture, note,
indenture, loan agreement, mortgage, deed of trust, or any other material contract, lease or
other instrument to which it is subject or by which it may be bound, or to which any of the
material property or assets of the Company is subject or (c) in violation in any material
respect of any law or statute or any order, rule, regulation, judgment or decree of any
court or Governmental Authority.
(xvi) The Company has timely filed all federal, state, local and foreign income and
franchise tax returns required to be filed and are not in default in the payment of any
material taxes which were payable pursuant to said returns or any assessments with respect
thereto, other than any which the Company is contesting in good faith. There is no pending
dispute with any taxing authority relating to any of such returns and the Company has no
knowledge of any proposed liability for any tax
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to be imposed upon the properties or assets of the Company for which there is not an
adequate reserve reflected in the Company’s financial statements included in the
Registration Statement, the Time of Sale Disclosure Package and the Prospectus
(xvii) The Company has not distributed and will not distribute any prospectus or other
offering material in connection with the offering and sale of the Securities other than any
Preliminary Prospectus, the Time of Sale Disclosure Package or the Prospectus or other
materials permitted by the Act to be distributed by the Company; provided, however, that,
except as set forth on Schedule II, the Company has not made and will not make any offer
relating to the Securities that would constitute a “free writing prospectus” as defined in
Rule 405 except in accordance with the provisions of Section 4(s) of this Agreement.
(xviii) The Securities have been approved for quotation on the Nasdaq National Market
upon official notice of issuance and, on the date the Registration Statement became or
becomes effective, the Company’s Registration Statement on Form 8-A or other applicable form
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), became or will
become effective.
(xix) The Company has no subsidiaries. The Company, directly or indirectly, owns no
capital stock or other equity or ownership or proprietary interest in any corporation,
partnership, association, trust or other entity.
(xx) The Company maintains a system of internal accounting controls sufficient to
provide reasonable assurances that (i) transactions are executed in accordance with
management’s general or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally accepted
accounting principles in the United States and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect to any
differences. Except as disclosed in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus, since the date of the most recent evaluation of such system of
internal accounting controls, there has been no material change in internal control over
financial reporting, including any corrective actions with regard to significant
deficiencies or material weaknesses.
(xxi) The Company’s board of directors has validly appointed an audit committee that
satisfies the applicable requirements of Rule 4350(d)(2) of the Rules of the National
Association of Securities Dealers, Inc. (the “NASD Rules”) and the Company’s board of
directors and/or the audit committee has adopted a charter that satisfies the requirements
of Rule 4350(d)(1) of the NASD Rules. Neither the Company’s board of directors nor the
audit committee has been informed, nor is any director of the Company aware, of (1) any
significant deficiency in the design or operation of the Company’s internal controls which
could adversely affect the
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Company’s ability to record, process, summarize and report financial data or any
material weakness in the Company’s internal controls; or (2) any fraud, whether or not
material, that involves management or other employees of the Company who have a significant
role in the Company’s internal controls.
(xxii) No relationship, direct or indirect, exists between or among the Company on the
one hand, and the directors, officers, stockholders, customers or suppliers of the Company
on the other hand, which is required to be described in the Registration Statement, the Time
of Sale Disclosure Package and the Prospectus which is not so described. The Company has
not, directly or indirectly, extended or maintained credit, or arranged for the extension of
credit, or renewed an extension of credit, in the form of a personal loan to or for any of
their directors or executive officers in violation of applicable laws, including Section 402
of the Xxxxxxxx-Xxxxx Act.
(xxiii) Except as described in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus: (i) the Company is and at all times has been in compliance in
all material respects with all statutes, rules, regulations or guidances applicable to the
ownership, testing, development, manufacture, packaging, processing, use, distribution,
marketing, labeling, promotion, sale, offer for sale, storage, import, export or disposal of
any product manufactured or distributed by the Company (“Applicable Laws”); (ii) the Company
has not received any FDA Form 483, warning letter, untitled letter or other correspondence
or notice from the U.S. Food and Drug Administration (“FDA”) or any other Governmental
Authority alleging or asserting noncompliance with any Applicable Laws or any licenses,
certificates, approvals, clearances, authorizations, permits and supplements or amendments
thereto required by any such Applicable Laws (“Authorizations”); (iii) the Company possesses
all material Authorizations and such material Authorizations are valid and in full force and
effect and are not in violation of any term of any such material Authorizations; (iv) the
Company has not received notice of any pending or threatened claim, action, suit,
proceeding, hearing, enforcement, investigation, arbitration or other action from any
Governmental Authority or third party alleging that any product, operation or activity is in
violation of any Applicable Laws or Authorizations and the Company does not have knowledge
that any such Governmental Authority or third party is considering any such claim,
litigation, arbitration, action, suit, investigation or proceeding; (v) the Company has not
received notice that any Governmental Authority has taken, is taking or intends to take
action to limit, suspend, modify or revoke any Authorizations and the Company does not have
knowledge that any such Governmental Authority is considering such action; (vi) the Company
has filed, obtained, maintained or submitted all material reports, documents, forms,
notices, applications, records, claims, submissions and supplements or amendments as
required by any Applicable Laws or Authorizations and that all such reports, documents,
forms, notices, applications, records, claims, submissions and supplements or amendments
were complete and correct in all material respects on the date filed (or were corrected or
supplemented in all material
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respects by a subsequent submission); and (vii) the Company has not, either voluntarily
or involuntarily, initiated, conducted or issued or caused to be initiated, conducted or
issued, any recall, market withdrawal or replacement, safety alert, post sale warning, “dear
doctor” letter or other notice or action relating to the alleged lack of safety or efficacy
of any product or any alleged product defect or violation and, to the knowledge of the
Company, no Governmental Authority has initiated, conducted or intends to initiate any such
notice or action.
(xxiv) The studies, tests and preclinical and clinical trials conducted by or, to the
knowledge of the Company, on behalf of the Company were and, if still pending, are being
conducted in accordance with experimental protocols, procedures and controls pursuant to
accepted professional scientific standards and all Applicable Laws and Authorizations,
including, without limitation, the Federal Food, Drug and Cosmetic Act and the rules and
regulations promulgated thereunder at 21 C.F.R. Parts 50, 54, 56, 58 and 312 (collectively,
“FFDCA”). The descriptions of the results of such studies, tests and trials contained in
the Registration Statement, the Time of Sale Disclosure Package and the Prospectus are
accurate and complete in all material respects and fairly present the data derived from such
studies, tests and trials. Except to the extent disclosed in the Registration Statement,
the Time of Sale Disclosure Package and the Prospectus, the Company does not have any
knowledge of any studies, tests or trials the results of which reasonably call into question
the study, test or trial results described or referred to in the Registration Statement, the
Time of Sale Disclosure Package and the Prospectus when viewed in the context in which such
results are described and the clinical state of development. The Company has not received
any notices or correspondence from any Governmental Authority requiring the termination,
suspension or material modification of any studies, tests or preclinical or clinical trials
conducted by or on behalf of the Company.
(xxv) Without limiting the generality of clause (xxiv) above and except as disclosed in
the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, the
Company and its business operations are and at all times have been in compliance in all
material respects with Health Care Laws. For purposes of this Agreement, “Health Care Laws”
means (A) the federal Food, Drug and Cosmetic Act, and the regulations promulgated
thereunder, (B) all federal and state fraud and abuse laws, including, without limitation,
the federal Anti-Kickback Statute (42 U.S.C. §1320a-7b(b)), the Xxxxx Law (42 U.S.C.
§1395nn), the civil False Claims Act (31 X.X.X. §0000 et seq.), Sections 1320a-7 and
1320a-7a of Title 42 of the United States Code and the regulations promulgated pursuant to
such statutes, (C) the Health Insurance Portability and Accountability Act of 1996 (18
U.S.C. §§669, 1035, 1347 and 1518; 42 U.S.C. §1320d et seq.) and the regulations promulgated
thereunder, (D) the Controlled Substances Act (21 U.S.C. §801 et seq.), (E) Titles XVIII (42
U.S.C. §1395 et seq.) and XIX (42 X.X.X. §0000 et seq.) of the Social Security Act and the
regulations promulgated thereunder, (F) the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (42 U.S.C. §1395w-101 et seq.) and the regulations promulgated
thereunder, (G) quality, safety and
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accreditation standards and requirements of all applicable state laws or regulatory
bodies and (H) any and all other applicable health care laws, regulations, manual
provisions, policies and administrative guidance, each of (A) through (H) as may be amended
from time to time.
(xxvi) The Company (i) is in compliance with any and all applicable federal, state,
local and foreign laws, rules, regulations, decisions and orders relating to the protection
of human health and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants (collectively, “Environmental Laws”); (ii) has received and is in
compliance with all permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their business; and (iii) has not received notice of any
actual or potential liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or wastes, pollutants or contaminants, except in
any such case for any such failure to comply, or failure to receive required permits,
licenses or approvals, or liability as would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change.
(xxvii) Each employee benefit plan, within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), that is maintained,
administered or contributed to by the Company for employees or former employees of the
Company has been maintained in compliance with its terms and the requirements of any
applicable statutes, orders, rules and regulations, including ERISA and the Internal Revenue
Code of 1986, as amended (the “Code”). No prohibited transaction, within the meaning of
Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any such plan
excluding transactions effected pursuant to a statutory or administrative exemption; and for
each such plan that is subject to the funding rules of Section 412 of the Code or Section
302 of ERISA, no “accumulated funding deficiency” as defined in Section 412 of the Code has
been incurred, whether or not waived, and the fair market value of the assets of each such
plan (excluding for these purposes accrued but unpaid contributions) exceeds the present
value of all benefits accrued under such plan determined using reasonable actuarial
assumptions.
(xxviii) Except as disclosed in the Registration Statement, the Time of Sale Disclosure
Package and the Prospectus, the Company has not granted rights to develop, manufacture,
produce, assemble, distribute, license, market or sell its products to any other person and
is not bound by any agreement that affects the exclusive right of the Company to develop,
manufacture, produce, assemble, distribute, license, market or sell its products.
(xxix) Nothing has come to the attention of the Company that has caused the Company to
believe that the statistical and market-related data included in the Registration Statement,
the Time of Sale Disclosure Package and the Prospectus is
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not based on or derived from sources that are reliable and accurate in all material
respects.
(xxx) Other than as contemplated by this Agreement, the Company has not incurred any
liability for any finder’s or broker’s fee or agent’s commission in connection with the
execution and delivery of this Agreement or the consummation of the transactions
contemplated hereby.
(xxxi) The Company is not presently doing business with the government of Cuba or with
any person or affiliate located in Cuba.
(xxxii) The Company carries, or is covered by, insurance in such amounts and covering
such risks as is adequate for the conduct of its business and the value of its properties
and as is customary for companies engaged in similar businesses in similar industries; and
the Company has (i) not received notice from any insurer or agent of such insurer that
capital improvements or other expenditures are required or necessary to be made in order to
continue such insurance or (ii) no reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain similar coverage
at reasonable cost from similar insurers as may be necessary to continue its business.
(xxxiii) Neither the Company nor, to the knowledge of the Company, any director,
officer, agent, employee or other person associated with or acting on behalf of the Company
has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity; (ii) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from corporate funds;
(iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of
1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment.
(xxxiv) Except with notice to the Representatives and compliance
with applicable laws, none of the Directed Stock (as defined below) distributed in
connection with the Directed Stock Program (as defined below) will be offered or
sold outside of the United States.
(xxxv) The Company is not and, after giving effect to the offering and sale of the
Securities, will not be an “investment company,” as such term is defined in the Investment
Company Act of 1940, as amended.
(xxxvi) The Company is in compliance with all applicable provisions of the
Xxxxxxxx-Xxxxx Act and the rules and regulations of the Commission thereunder.
(b) Any certificate signed by any executive officer of the Company and delivered to you or to
counsel for the Underwriters in connection with the transactions contemplated by this Agreement
shall be deemed a representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
3. Purchase, Sale and Delivery of Securities.
(a) On the basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company agrees to issue
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and sell the Firm Shares to the several Underwriters, and each Underwriter agrees, severally
and not jointly, to purchase from the Company the number of Firm Shares set forth opposite the name
of such Underwriter in Schedule I hereto. The purchase price for each Firm Share shall be $ per
share. In making this Agreement, each Underwriter is contracting severally and not jointly; except
as provided in paragraph (c) of this Section 3 and in Section 8 hereof, the agreement of each
Underwriter is to purchase only the respective number of Firm Shares
specified in Schedule I.
It is understood that ___shares of the Firm Shares (“Directed Stock”) will initially be
reserved by the Underwriters for offer and sale to employees and persons having relationships with
the Company or its employees (“Directed Stock Participants”) upon the terms and conditions set
forth in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus and in
accordance with the rules and regulations of the National Association of Securities Dealers
(“Directed Stock Program”). Under no circumstance will the Representatives or any Underwriter be
liable to the Company or to any Directed Stock Participant for any action taken or omitted to be
taken in good faith in connection with such Directed Stock Program. To the extent that any shares
of Directed Stock are not affirmatively reconfirmed for purchase by any Directed Stock Participant
on or immediately after the date of this Agreement, such Directed Stock may be offered to the
public as part of the public offering contemplated hereby. The Company agrees to pay all fees and
disbursements incurred by the Underwriters in connection with the Directed Stock Program, including
counsel fees and any stamp duties or other taxes incurred by the Underwriters in connection with
the Directed Stock Program.
The Firm Shares will be delivered by the Company to you for the accounts of the several
Underwriters against payment of the purchase price therefor by wire transfer of same day funds
payable to the order of the Company at the offices of Xxxxxx & Xxxxxxx LLP, 000 Xxxxxxxxxxxx Xxxxx,
Xxxxx Xxxx, Xxxxxxxxxx 00000, or such other location as may be mutually acceptable, at 10:00 a.m.
Eastern time on the third (or if the Securities are priced, as contemplated by Rule 15c6-1(c) under
the Exchange Act, after 4:30 p.m. Eastern time, the fourth) full business day following the date
hereof, or at such other time and date as you and the Company determine pursuant to Rule 15c6-1(a)
under the Exchange Act, such time and date of delivery being herein referred to as the “First
Closing Date.” If the Representatives so elect, delivery of the Firm Shares may be made by credit
through full fast transfer to the accounts at The Depository Trust Company designated by the
Representatives. Certificates representing the Firm Shares, in definitive form and in such
denominations and registered in such names as you may request upon at least two business days’
prior notice to the Company, will be made available for checking and packaging not later than 10:00
a.m., Eastern time, on the business day next preceding the First Closing Date at the offices of
Xxxxxx & Xxxxxxx LLP, 000 Xxxxxxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000, or such other location
as may be mutually acceptable.
(b) On the basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company hereby grants, to the several
Underwriters an option to purchase all or any portion of the Option Shares at the same purchase
price as the Firm Shares, for use solely in covering any over-allotments made by the Underwriters
in the sale and distribution of the Firm Shares. The option granted hereunder may be exercised in
whole or in part at any time (but not more than once) within 30 days after the effective date of
this Agreement upon notice (confirmed in writing) by the Representatives to the Company setting
forth the aggregate number of Option Shares as to which the several Underwriters are exercising the
option, the names and denominations in which the certificates for the Option Shares are to be
registered and the date and time, as determined by you, when the Option Shares are to be delivered,
such time and date being herein referred to as the “Second Closing” and “Second Closing Date,”
respectively; provided, however, that the Second Closing Date shall not be earlier than the First
Closing Date nor earlier than the second business day after the date on which the option shall have
been exercised. If the option is exercised, the number of Option Shares to be purchased by each
Underwriter shall be the same percentage of the total number of Option Shares to be purchased by
the several Underwriters as the number of Firm Shares to be purchased by such Underwriter is of the
total number of Firm Shares to be purchased by the several Underwriters, as adjusted by the
Representatives in such manner as the
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Representatives deem advisable to avoid fractional shares. No Option Shares shall be sold and
delivered unless the Firm Shares previously have been, or simultaneously are, sold and delivered.
The Option Shares will be delivered by the Company to you for the accounts of the several
Underwriters against payment of the purchase price therefor by wire transfer of same day funds
payable to the order of the Company, at the offices of Xxxxxx & Xxxxxxx LLP, 000 Xxxxxxxxxxxx
Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000, or such other location as may be mutually acceptable at 10:00
a.m., Eastern time, on the Second Closing Date. If the Representatives so elect, delivery of the
Option Shares may be made by credit through full fast transfer to the accounts at The Depository
Trust Company designated by the Representatives. Certificates representing the Option Shares in
definitive form and in such denominations and registered in such names as you have set forth in
your notice of option exercise, will be made available for checking and packaging not later than
10:00 a.m., Eastern time, on the business day next preceding the Second Closing Date at the offices
of Xxxxxx & Xxxxxxx LLP, 000 Xxxxxxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000 or such other
location as may be mutually acceptable.
(c) It is understood that you, individually and not as Representatives of the several
Underwriters, may (but shall not be obligated to) make payment to the Company on behalf of any
Underwriter for the Securities to be purchased by such Underwriter. Any such payment by you shall
not relieve any such Underwriter of any of its obligations hereunder. Nothing herein contained
shall constitute any of the Underwriters an unincorporated association or partner with the Company.
4. Covenants.
The Company covenants and agrees with the several Underwriters as follows:
(a) If the Registration Statement has not already been declared effective by the Commission,
the Company will use its best efforts to cause the Registration Statement and any post-effective
amendments thereto to become effective as promptly as possible; the Company will notify you
promptly of the time when the Registration Statement or any post-effective amendment to the
Registration Statement has become effective or any supplement to the Prospectus has been filed and
of any request by the Commission for any amendment or supplement to the Registration Statement or
Prospectus or additional information; if the Company has elected to rely on Rule 430A, the Company
will prepare and file a Prospectus containing the information omitted therefrom pursuant to Rule
430A with the Commission within the time period required by, and otherwise in accordance with the
provisions of, Rules 424(b) and 430A; if the Company has elected to rely upon Rule 462(b) to
increase the size of the offering registered under the Act, the Company will prepare and file a
registration statement with respect to such increase with the Commission within the time period
required by, and otherwise in accordance with the provisions of, Rule 462(b); the Company will
prepare and file with the Commission, promptly upon your request, any amendments or supplements to
the Registration Statement or Prospectus that, in your
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opinion, may be necessary or advisable in connection with the distribution of the Securities
by the Underwriters; and the Company will not file any amendment or supplement to the Registration
Statement or Prospectus to which you shall reasonably object by notice to the Company after having
been furnished a copy a reasonable time prior to the filing.
(b) The Company will advise you, promptly after it shall receive notice or obtain knowledge
thereof, of the issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement, or any post-effective amendment thereto, or preventing or suspending the
use of any Preliminary Prospectus, the Time of Sale Disclosure Package, the Prospectus or any
Issuer-Represented Free Writing Prospectus, of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any
proceeding for any such purpose; and the Company will promptly use its best efforts to prevent the
issuance of any stop order or to obtain its withdrawal if such a stop order should be issued.
Additionally, the Company agrees that it shall comply with the provisions of Rules 424(b) and 430A,
as applicable, and will use its reasonable efforts to confirm that any filings made by the Company
under Rule 424(b), Rule 433 or Rule 462 were received in a timely manner by the Commission.
(c) (i) Within the time during which a prospectus (or in lieu thereof the notice referred to
in Rule 173(a) of the Rules and Regulations (“Rule 173”) relating to the Securities is required to
be delivered under the Act (the “Prospectus Delivery Period”) the Company will comply as far as it
is able with all requirements imposed upon it by the Act, as now and hereafter amended, and by the
Rules and Regulations, as from time to time in force, so far as necessary to permit the continuance
of sales of or dealings in the Securities as contemplated by the provisions hereof, the Time of
Sale Disclosure Package and the Prospectus. If during the Prospectus Delivery Period (A) any event
shall occur or condition shall exist as a result of which the Prospectus, as then amended or
supplemented (or if the Prospectus is not yet available to prospective purchasers, the Time of Sale
Disclosure Package) would include an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of the circumstances then
existing, not misleading, or (B) it is necessary to amend the Registration Statement or supplement
the Prospectus (or if the Prospectus is not yet available to prospective investors, the Time of
Sale Disclosure Package) to comply with the Act, the Company will promptly notify you and will
amend the Registration Statement or supplement the Prospectus (or, if the Prospectus is not yet
available to prospective purchasers, the Time of Sale Disclosure Package) (at the expense of the
Company) so as to correct such statement or omission or effect such compliance.
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(ii) If at any time following issuance of an Issuer-Represented General Free Writing
Prospectus there occurred or occurs an event or development as a result of which such
Issuer-Represented General Free Writing Prospectus, conflicted or would conflict with the
information contained in the Registration Statement relating to the Securities or included or would
include an untrue statement of a material fact or omitted or would omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances prevailing at
that subsequent time, not misleading, the Company has promptly notified or promptly will notify the
Representatives and has promptly amended or will promptly amend or supplement, at its own expense,
such Issuer-Represented General Free Writing Prospectus to eliminate or correct such conflict,
untrue statement or omission.
(d) The Company shall take or cause to be taken all necessary action to qualify the Securities
for sale under the securities laws of such jurisdictions as you reasonably designate and to
continue such qualifications in effect so long as required for the distribution of the Securities,
except that the Company shall not be required in connection therewith to qualify as a foreign
corporation or to execute a general consent to service of process in any state.
(e) The Company will furnish to the Underwriters and counsel for the Underwriters copies of
the Registration Statement (three of which will be signed and will include all consents and
exhibits filed therewith), each Preliminary Prospectus, the Time of Sale Disclosure Package, the
Prospectus and all amendments and supplements to such documents, in each case as soon as available
and in such quantities as you may from time to time reasonably request.
(f) During a period of five years commencing with the date hereof, the Company will furnish to
the Representatives, and to each Underwriter who may so request in writing, copies of all periodic
and special reports furnished to the stockholders of the Company and all information, documents and
reports filed with the Commission, the National Association of Securities Dealers, Inc., Nasdaq or
any securities exchange (other than any such information, documents and reports that are filed with
the Commission electronically via XXXXX or any successor system).
(g) The Company will make generally available to its security holders as soon as practicable,
but in any event not later than 15 months after the end of the Company’s current fiscal quarter, an
earnings statement (which need not be audited) covering a 12-month period beginning after the
effective date of the Registration Statement that shall satisfy the provisions of Section 11(a) of
the Act and Rule 158 of the Rules and Regulations.
(h) The Company, whether or not the transactions contemplated hereunder are consummated or
this Agreement is prevented from becoming effective under the provisions of Section 9(a) hereof or
is terminated, will pay or cause to be paid (i) all expenses (including transfer taxes allocated to
the respective transferees) incurred in connection with the delivery to the Underwriters of the
Securities, (ii) all expenses and fees (including, without limitation, fees and expenses of the
Company’s accountants and counsel but, except as otherwise provided
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below, not including fees of the Underwriters’ counsel) in connection with the preparation,
printing, filing, delivery, and shipping of the Registration Statement (including the financial
statements therein and all amendments, schedules, and exhibits thereto), the Securities, each
Preliminary Prospectus, the Time of Sale Disclosure Package, the Prospectus, and any amendment
thereof or supplement thereto, and any Issuer-Represented Free Writing Prospectus and the printing,
delivery, and shipping of this Agreement and other underwriting documents, including Blue Sky
Memoranda (covering the states and other applicable jurisdictions), (iii) all filing fees and fees
and disbursements (not in excess, in the aggregate, of $10,000) of the Underwriters’ counsel
incurred in connection with the qualification of the Securities for offering and sale by the
Underwriters or by dealers under the securities or blue sky laws of the states and other
jurisdictions which you shall designate or are necessary to distribute the Directed Stock, (iv) the
fees and expenses of any transfer agent or registrar, (v) the filing fees incident to any required
review by the National Association of Securities Dealers, Inc. of the terms of the sale of the
Securities, (vi) listing fees, if any, (vii) the costs and expenses relating to investor
presentations on any “road show” undertaken in connection with the marketing of the Securities and
(viii) all other costs and expenses incident to the performance of its obligations hereunder that
are not otherwise specifically provided for herein; provided, however, that the Underwriters shall
bear the cost of travel and lodging for the Underwriters in connection with the investor
presentations on any “road show” undertaken in connection with the marketing of the Securities;
provided, however, that travel and lodging costs not attributable solely to the Underwriters (i.e.,
shared travel costs such as a chartered aircraft) shall be shared equally by the Company and the
Underwriters. If the sale of the Securities provided for herein is not consummated by reason of
action by the Company pursuant to Section 9(a) hereof or action by you pursuant to Section 9(b)
hereof which prevents this Agreement from becoming effective, or by reason of any failure, refusal
or inability on the part of the Company to perform any agreement on its part to be performed, or
because any other condition of the Underwriters’ obligations hereunder required to be fulfilled by
the Company is not fulfilled, the Company will reimburse the several Underwriters for all
out-of-pocket disbursements (including reasonable fees and disbursements of counsel) incurred by
the Underwriters in connection with their investigation, preparing to market and marketing the
Securities or in contemplation of performing their obligations hereunder. The Company shall not in
any event be liable to any of the Underwriters for loss of anticipated profits from the
transactions covered by this Agreement.
(i) The Company will apply the net proceeds from the sale of the Securities to be sold by it
hereunder for the purposes set forth in the Prospectus and will file such reports with the
Commission with respect to the sale of the Securities and the application of the proceeds therefrom
as may be required in accordance with Rule 463 of the Rules and Regulations.
(j) The Company will not, without the prior written consent of Xxxxx Xxxxxxx & Co., and
Pacific Growth Equities, LLC from the date of execution of this Agreement and continuing to and
including the date 180 days after the date of the Prospectus (the “Lock-Up Period”) offer for sale;
sell, contract to sell, pledge, grant any option for the sale of, enter into any transaction which
is designed to, or might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due
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to cash settlement or otherwise) by the Company or any affiliate, or otherwise issue or
dispose of, directly or indirectly (or publicly disclose the intention to make any such offer,
sale, pledge, grant, issuance or other disposition), any Common Stock or any securities convertible
into or exchangeable for, or any options or rights to purchase or acquire, Common Stock, except (i)
to the Underwriters pursuant to this Agreement, (ii) to directors, employees and consultants of the
Company pursuant to the Company’s 2001 Equity Incentive Plan, 2002 Equity Incentive Plan, as
amended, 2005 Equity Incentive Plan, 2005 Employee Stock Purchase Plan and 2005 Non-Employee
Directors’ Stock Option Plan and (iii) upon exercise or conversion of securities outstanding as of
the date hereof. Notwithstanding the foregoing, for the purpose of allowing the Underwriters to
comply with NASD Rule 2711(f)(4), if (i) during the last 17 days of the Lock-Up Period, the Company
releases earnings results or publicly announces other material news or a material event relating to
the Company is publicly announced or occurs or (ii) prior to the expiration of the Lock-Up Period,
the Company announces that it will release earnings results during the 16-day period beginning on
the last day of the Lock-Up Period, then in each case the Lock-Up Period will be extended until the
expiration of the 18-day period beginning on the date of release of the earnings results or the
public announcement regarding the material news or the occurrence of the material event, as
applicable, unless Xxxxx Xxxxxxx & Co. and Pacific Growth Equities, LLC waive, in writing, such
extension; provided, however, that this provision will not apply to any research report concerning
the Company to be published or distributed by an Underwriter pursuant to Rule 139 promulgated under
the Securities Act at a time when the Company’s shares of Common Stock are “actively traded
securities,” as defined in Regulation M, 17 C.F.R. 242.101(c)(1). The Company agrees not to
accelerate the vesting of any option or warrant or the lapse of any repurchase right prior to the
expiration of the Lock-Up Period, unless all securities of the Company owned by such person are
subject to the restrictions set forth in this paragraph (j).
(k) The Company either has caused to be delivered to you or will cause to be delivered to you
prior to the effective date of the Registration Statement an agreement substantially in the form
attached hereto as Exhibit A from each of the Company’s directors, officers, stockholders,
warrantholders and optionholders (the “Lock-Up Agreement”). The Company will enforce the terms of
each Lock-Up Agreement and issue stop-transfer instructions to the transfer agent for the Common
Stock with respect to any transaction or contemplated transaction that would constitute a breach of
or default under the applicable Lock-Up Agreement.
(l) The Company has not taken and will not take, directly or indirectly, any action designed
to or which might reasonably be expected to cause or result in, or which has constituted, the
stabilization or manipulation of the price of any security of the Company to facilitate the sale or
resale of the Securities, and has not effected any sales of Common Stock which are required to be
disclosed in response to Item 701 of Regulation S-K under the Act which have not been so disclosed
in the Registration Statement.
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(m) The Company will not incur any liability for any finder’s or broker’s fee or agent’s
commission in connection with the execution and delivery of this Agreement or the consummation of
the transactions contemplated hereby.
(n) The Company will comply with all applicable securities and other applicable
laws, rules and regulations in each foreign jurisdiction in which Directed Stock is offered in
connection with the Directed Stock Program.
(o) In connection with the Directed Stock Program to ensure that the Directed Stock
will be restricted to the extent required by the National Association of Securities Dealers or the
rules of such association from sale, transfer, assignment, pledge or hypothecation for a period of
three months following the date of the effectiveness of the Registration Statement, the Company
will direct the transfer agent to place stop-transfer restrictions upon such securities for such
period of time. Should the Company release, or seek to release, from such restrictions any of the
Directed Stock, the Company agrees to reimburse the Underwriters for any reasonable expense
(including, without limitation, legal expenses) they incur with such release.
(p) The Company will file with the Commission such periodic and special reports as required by
the Rules and Regulations.
(q) The Company will maintain such controls and other procedures required by Sections 302 and
906 of the Xxxxxxxx-Xxxxx Act and the applicable regulations thereunder that are designed to ensure
that information required to be disclosed by the Company in the reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported within the time periods
specified in the Commission’s rules and forms, including without limitation, controls and
procedures designed to ensure that information required to be disclosed by the Company in the
reports that it files or submits under the Exchange Act is accumulated and communicated to the
Company’s management, including its principal executive officer and its principal financial
officer, or persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure, to ensure that material information relating to Company is made
known to them by others within those entities.
(r) The Company will comply with all effective applicable provisions of the Xxxxxxxx-Xxxxx
Act.
(s) The Company represents and agrees that, unless it obtains the prior written consent of
Xxxxx Xxxxxxx & Co. and Pacific Growth Equities, LLC, and each Underwriter severally represents and
agrees that, unless it obtains the prior consent of the Company, Xxxxx Xxxxxxx & Co. and Pacific
Growth Equities, LLC, it has not made and will not make any offer relating to the Securities that
would constitute an “issuer free writing prospectus,” as defined in Rule 433, or that would
otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be filed with
the Commission. Any such free writing prospectus consented to by the Company, Xxxxx Xxxxxxx & Co.
and Pacific Growth Equities, LLC is hereinafter referred to as a “Permitted Free Writing
Prospectus.” The Company represents that it has treated or agrees that it will treat each
Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433,
and has complied and will comply with the requirements of Rule 433 applicable to any Permitted Free
Writing Prospectus, including timely Commission filing where required, legending and record
keeping. The Company represents that it has satisfied and agrees that it will satisfy the
conditions in Rule 433 to avoid a requirement to file with the Commission any electronic road show.
5. Conditions of Underwriters’ Obligations. The obligations of the several Underwriters
hereunder are subject to the accuracy, as of the date hereof and at each of the First Closing Date
and the Second Closing Date (as if made at such Closing Date), of and compliance with all
representations, warranties and agreements of the Company contained
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herein, to the performance by the Company of its obligations hereunder and to the following
additional conditions:
(a) The Registration Statement shall have become effective not later than 6:00 p.m., Eastern
time, on the date of this Agreement, or such later time and date as you, as Representatives of the
several Underwriters, shall approve and all filings required by Rules 424, 430A and 433 shall have
been timely made; no stop order suspending the effectiveness of the Registration Statement or any
amendment thereof shall have been issued; no proceedings for the issuance of such an order shall
have been initiated or threatened; and any request of the Commission for additional information (to
be included in the Registration Statement, the Time of Sale Disclosure Package, the Prospectus, any
Issuer-Represented Free Writing Prospectus or otherwise) shall have been complied with to your
satisfaction.
(b) No Underwriter shall have advised the Company that the Registration Statement, the Time of
Sale Disclosure Package or the Prospectus, or any amendment thereof or supplement thereto, or any
Issuer-Represented Free Writing Prospectus contains an untrue statement of fact which, in your
opinion, is material, or omits to state a fact which, in your opinion, is material and is required
to be stated therein or necessary to make the statements therein, in light of the circumstances
under which they are made, not misleading.
(c) Except as contemplated in the Time of Sale Disclosure Package and the Prospectus,
subsequent to the respective dates as of which information is given in the Time of Sale Disclosure
Package, the Company shall not have incurred any material liabilities or obligations, direct or
contingent, or entered into any material transactions, or declared or paid any dividends or made
any distribution of any kind with respect to its capital stock; and there shall not have been any
change in the capital stock (other than a change in the number of outstanding shares of Common
Stock due to the issuance of shares upon the exercise of outstanding options or warrants), or any
material change in the short-term or long-term debt of the Company, or any issuance of options,
warrants, convertible securities or other rights to purchase the capital stock of the Company, or
any Material Adverse Change or any development involving a prospective Material Adverse Change
(whether or not arising in the ordinary course of business), that, in your judgment, makes it
impractical or inadvisable to offer or deliver the Securities on the terms and in the manner
contemplated in the Time of Sale Disclosure Package and the Prospectus.
(d) On each Closing Date, there shall have been furnished to you, as Representatives of
the several Underwriters, the opinion of Xxxxxx Godward LLP, counsel for the Company, dated
such Closing Date and addressed to you, in the form set forth on Exhibit B.
In rendering such opinion such counsel may rely (i) as to matters of law other than California
and federal law, upon the opinion or opinions of local counsel provided that the extent of such
reliance is specified in such opinion and that such counsel shall state that such opinion or
opinions of local counsel are satisfactory to them and that they believe they and you are justified
in relying thereon and (ii) as to matters of fact, to the extent such counsel deems
-22-
reasonable upon certificates of officers of the Company provided that the extent of such reliance
is specified in such opinion.
(e) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, the opinion of Xxxxx, Xxxxxx & XxXxxxxx, P.C., special regulatory counsel for
the Company, dated such Closing Date and addressed to you, in the form set forth on Exhibit C.
(f) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, the opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation,
special intellectual property counsel for the Company, dated such Closing Date and addressed to
you, in the form set forth on Exhibit D.
In rendering such opinion such counsel may rely (i) as to matters of law other than California
and federal law, upon the opinion or opinions of local counsel provided that the extent of such
reliance is specified in such opinion and that such counsel shall state that such opinion or
opinions of local counsel are satisfactory to them and that they believe they and you are justified
in relying thereon and (ii) as to matters of fact, to the extent such counsel deems reasonable upon
certificates of officers of the Company provided that the extent of such reliance is specified in
such opinion.
(g) On each Closing Date, there shall have been furnished to you, as Representatives of the
several Underwriters, such opinion or opinions from Xxxxxx & Xxxxxxx LLP, counsel for the several
Underwriters, dated such Closing Date and addressed to you, with respect to the formation of the
Company, the validity of the Securities, the Registration Statement, the Time of Sale Disclosure
Package or the Prospectus and other related matters as you reasonably may request, and such counsel
shall have received such papers and information as they request to enable them to pass upon such
matters.
(h) On each Closing Date you, as Representatives of the several Underwriters, shall have
received a letter of Ernst & Young LLP, dated such Closing Date and addressed to you, confirming
that they are independent public accountants within the meaning of the Act and are in compliance
with the applicable requirements relating to the qualifications of accountants under Rule 2-01 of
Regulation S-X of the Commission, and stating, as of the date of such letter (or, with respect to
matters involving changes or developments since the respective dates as of which specified
financial information is given in the Time of Sale Disclosure Package, as of a date not prior to
the date hereof or more than five days prior to the date of such letter), the conclusions and
findings of said firm with respect to the financial information and other matters covered by its
letter delivered to you concurrently with the execution of this Agreement, and the effect of the
letter so to be delivered on such Closing Date shall be to confirm the conclusions and findings set
forth in such prior letter.
(i) On each Closing Date, there shall have been furnished to you, as Representatives of the
Underwriters, a certificate, dated such Closing Date and addressed to
-23-
you, signed by the chief executive officer and by the chief financial officer of the Company,
to the effect that:
(i) The representations and warranties of the Company in this Agreement are true and
correct, in all material respects, as if made at and as of such Closing Date, and the
Company has complied with all the agreements and satisfied all the conditions on its part to
be performed or satisfied at or prior to such Closing Date;
(ii) No stop order or other order suspending the effectiveness of the Registration
Statement or any amendment thereof or the qualification of the Securities for offering or
sale has been issued, and no proceeding for that purpose has been instituted or, to the best
of their knowledge, is contemplated by the Commission or any state or regulatory body; and
(iii) The signers of said certificate have carefully examined the Registration
Statement, the Time of Sale Disclosure Package and the Prospectus, and any amendments
thereof or supplements thereto, and (A) each part of the Registration Statement and the
Prospectus, and any amendments thereof or supplements thereto contain, and contained when
such part of the Registration Statement, or any amendment thereof, became effective, all
statements and information required to be included therein, the Registration Statement, or
any amendment thereof, does not contain and did not contain when such part of the
Registration Statement, or any amendment thereof, became effective, any untrue statement of
a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and the Prospectus, as amended or
supplemented, does not include and did not include as of the Time of Sale, any untrue
statement of material fact or omit to state and did not omit to state as of the Time of Sale
a material fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, (B) neither (1) the Time of Sale Disclosure
Package nor (2) any individual Issuer-Represented Limited-Use Free Writing Prospectus, when
considered together with the Time of Sale Disclosure Package, include, nor included as of
the Time of Sale any untrue statement of a material fact or omits, or omitted as of the Time
of Sale, to state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading, (C) since the
Time of Sale there has occurred no event required to be set forth in an amended or
supplemented prospectus which has not been so set forth, (D) subsequent to the respective
dates as of which information is given in the Time of Sale Disclosure Package, the Company
has not incurred any material liabilities or obligations, direct or contingent, or entered
into any material transactions, not in the ordinary course of business, or declared or paid
any dividends or made any distribution of any kind with respect to its capital stock, and
except as disclosed in the Time of Sale Disclosure Package and in the Prospectus, there has
not been any change in the capital stock (other than a change in the number of outstanding shares of Common Stock due to the issuance of shares upon the exercise of outstanding
options or warrants), or any material change in the short-term or
-24-
long-term debt, or any issuance of options, warrants, convertible securities or other
rights to purchase the capital stock, of the Company, or any Material Adverse Change or any
development involving a prospective Material Adverse Change (whether or not arising in the
ordinary course of business), and (E) except as stated in the Time of Sale Disclosure
Package and in the Prospectus, there is not pending, or, to the knowledge of the Company,
threatened or contemplated, any action, suit or proceeding to which the Company is a party
before or by any court or Governmental Authority, or any arbitrator, which would reasonably
be expected to result in any Material Adverse Change.
(j) The Underwriters shall have received all the Lock-Up Agreements referenced in Section
4(j).
(k) At each Closing Date, counsel for the Underwriters shall have been furnished with such
information, certificates and documents as they may reasonably require for the purpose of enabling
them to pass upon the issuance and sale of the Securities as contemplated herein and related
proceedings, or to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained, or otherwise in connection with the
offering of the Securities contemplated hereby.
(l) The Nasdaq National Market shall have approved the Securities for listing, subject only to
official notice of issuance.
All such opinions, certificates, letters and other documents will be in compliance with the
provisions hereof only if they are satisfactory in form and substance to you and counsel for the
Underwriters. The Company will furnish you with such conformed copies of such opinions,
certificates, letters and other documents as you shall reasonably request.
6. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise (including in settlement of any litigation if such settlement is
effected with the written consent of the Company), insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in the Registration Statement, including the
information deemed to be a part of the Registration Statement at the time of effectiveness and at
any subsequent time pursuant to Rules 430A and 430(C), if applicable, any Preliminary Prospectus,
the Time of Sale Disclosure Package, the Prospectus, or any amendment or supplement thereto, any
Issuer-Represented Free Writing Prospectus or any “issuer information” filed or required to be
filed by the Company pursuant to Rule 433, or in any materials or information provided to investors
by, or with the approval of, the Company in connection with the marketing of the offering of the
Common Stock (“Marketing Materials”), including any roadshow or investor presentations made to
investors by the Company (whether in person or electronically) or arise out of or are based
-25-
upon the omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by it in connection with
investigating or defending against such loss, claim, damage, liability or action; provided,
however, that the Company shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration Statement, any
Preliminary Prospectus, the Time of Sale Disclosure Package, the Prospectus, or any such amendment
or supplement, any Issuer-Represented Free Writing Prospectus or in any Marketing Materials, in
reliance upon and in conformity with written information furnished to the Company by you, or by any
Underwriter through you, specifically for use in the preparation thereof.
In addition to its other obligations under this Section 6(a), the Company agrees that, as an
interim measure during the pendency of any claim, action, investigation, inquiry or other
proceeding arising out of or based upon any statement or omission, or any alleged statement or
omission, described in this Section 6(a), it will reimburse each Underwriter on a monthly basis for
all reasonable legal fees or other expenses incurred in connection with investigating or defending
any such claim, action, investigation, inquiry or other proceeding, notwithstanding the absence of
a judicial determination as to the propriety and enforceability of the Company’s obligation to
reimburse the Underwriters for such expenses and the possibility that such payments might later be
held to have been improper by a court of competent jurisdiction. To the extent that any such
interim reimbursement payment is so held to have been improper, the Underwriter that received such
payment shall promptly return it to the party or parties that made such payment, together with
interest, compounded daily, determined on the basis of the prime rate (or other commercial lending
rate for borrowers of the highest credit standing) announced from time to time by
______(the “Prime Rate”). Any such interim reimbursement payments which are not
made to an Underwriter within 30 days of a request for reimbursement shall bear interest at the
Prime Rate from the date of such request. This indemnity agreement shall be in addition to any
liabilities which the Company may otherwise have.
(b) Each Underwriter will indemnify and hold harmless the Company against any losses, claims,
damages or liabilities to which the Company may become subject, under the Act or otherwise
(including in settlement of any litigation, if such settlement is effected with the written consent
of such Underwriter), insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, any Preliminary Prospectus, the Time of Sale
Disclosure Package, the Prospectus, or any amendment or supplement thereto, or any
Issuer-Represented Free Writing Prospectus or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged omission was made in
the Registration Statement, any Preliminary Prospectus, the Time of Sale Disclosure Package, the
Prospectus, or any such
-26-
amendment or supplement, or any Issuer-Represented Free Writing Prospectus in reliance upon
and in conformity with written information furnished to the Company by you, or by such Underwriter
through you, specifically for use in the preparation thereof, and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection with investigating or
defending against any such loss, claim, damage, liability or action.
In addition to its other obligations under this Section 6(b), the Underwriters, jointly and
severally, agree that, as an interim measure during the pendency of any claim, action,
investigation, inquiry or other proceeding arising out of or based upon any statement or omission,
or any alleged statement or omission, described in this Section 6(b), they will reimburse the
Company on a monthly basis for all reasonable legal fees or other expenses incurred in connection
with investigating or defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and enforceability of
the Underwriters’ obligation to reimburse the Company for such expenses and the possibility that
such payments might later be held to have been improper by a court of competent jurisdiction. To
the extent that any such interim reimbursement payment is so held to have been improper, the
Company shall promptly return it to the party or parties that made such payment, together with
interest, compounded daily, determined on the basis of the prime rate (or other commercial lending
rate for borrowers of the highest credit standing) announced from time to time by
______(the “Prime Rate”). Any such interim reimbursement payments which are not
made to the Company within 30 days of a request for reimbursement shall bear interest at the Prime
Rate from the date of such request. This indemnity agreement shall be in addition to any
liabilities which the Underwriters may otherwise have.
(c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice
of the commencement of any action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the indemnifying party shall not
relieve the indemnifying party from any liability that it may have to any indemnified party except
to the extent such indemnifying party has been materially prejudiced by such failure. In case any
such action shall be brought against any indemnified party, and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to participate in, and,
to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of the indemnifying party’s election so to
assume the defense thereof, the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable costs of investigation;
provided, however, that if, in the sole judgment of the Representatives, it is advisable for the
Underwriters to be represented as a group by separate counsel, the Representatives shall have the
right to employ a single counsel to represent the Representatives and all Underwriters who may be
subject to liability arising from any claim
-27-
in respect of which indemnity may be sought by the Underwriters under subsection (a) of this
Section 6, in which event the reasonable fees and expenses of such separate counsel shall be borne
by the indemnifying party or parties and reimbursed to the Underwriters as incurred (in accordance
with the provisions of the second paragraph in subsection (a) above). An indemnifying party shall
not be obligated under any settlement agreement relating to any action under this Section 6 to
which it has not agreed in writing. In addition, no indemnifying party shall, without the prior
written consent of the indemnified party (which consent shall not be unreasonably withheld or
delayed), effect any settlement of any pending or threatened proceeding unless such settlement
includes an unconditional release of such indemnified party for all liability on claims that are
the subject matter of such proceeding.
(d) If the indemnification provided for in this Section 6 is unavailable or insufficient to
hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above, (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the Securities or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also the relative fault
of the Company on the one hand and the Underwriters on the other in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information supplied by the
Company or the Underwriters and the parties’ relevant intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if contributions pursuant to this
subsection (d) were to be determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to in the first sentence of this subsection (d). The amount
paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to
in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating or defending against
any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of
this subsection (d), no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
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(within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations in
this subsection (d) to contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 6 shall be in addition to any liability
which the Company may otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 6 shall be in addition to any liability that the respective
Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company (including any person who, with his consent, is named in the Registration
Statement as about to become a director of the Company), to each officer of the Company who has
signed the Registration Statement and to each person, if any, who controls the Company within the
meaning of the Act.
(f) The Underwriters severally confirm and the Company acknowledges that the statements with
respect to the public offering of the Securities by the Underwriters set forth in
[____________], in the Time of Sale Disclosure Package and in the Prospectus are correct and
constitute the only information concerning such Underwriters furnished in writing to the Company by
or on behalf of the Underwriters specifically for inclusion in the Registration Statement, any
Preliminary Prospectus, the Time of Sale Disclosure Package, the Prospectus or any
Issuer-Represented Free Writing Prospectus.
(g) [In connection with the offer and sale of the Directed Stock, the Company agrees, promptly
upon a request in writing, to indemnify and hold harmless the Underwriters from and against any and
all losses, liabilities, claims, damages and expenses incurred by them as a result of the failure
of the Directed Stock Participants to affirmatively reconfirm the Directed Stock for purchase as of
the date of this Agreement or to pay for and accept delivery of the Directed Stock by the end of
the First Closing Date.]
7. Representations and Agreements to Survive Delivery. All representations, warranties, and
agreements of the Company herein or in certificates delivered pursuant hereto, and the agreements
of the several Underwriters and the Company contained in Section 6 hereof, shall remain operative
and in full force and effect regardless of any investigation made by or on behalf of any
Underwriter or any controlling person thereof, or the Company or any of its officers, directors, or
controlling persons, and shall survive delivery of, and payment for, the Securities to and by the
Underwriters hereunder.
8. Substitution of Underwriters.
(a) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Firm
Shares agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such
Firm Shares in accordance with the terms hereof, and the amount of Firm Shares not purchased does
not aggregate more than 10% of the total amount
-29-
of Firm Shares set forth in Schedule I hereto, the remaining Underwriters shall be obligated
to take up and pay for (in proportion to their respective underwriting obligations hereunder as set
forth in Schedule I hereto except as may otherwise be determined by you) the Firm Shares that the
withdrawing or defaulting Underwriters agreed but failed to purchase.
(b) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Firm
Shares agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such
Firm Shares in accordance with the terms hereof, and the amount of Firm Shares not purchased
aggregates more than 10% of the total amount of Firm Shares set forth in Schedule I hereto, and
arrangements satisfactory to you for the purchase of such Firm Shares by other persons are not made
within 36 hours thereafter, this Agreement shall terminate. In the event of any such termination
the Company shall not be under any liability to any Underwriter (except to the extent provided in
Section 4(h) and Section 6 hereof) nor shall any Underwriter (other than an Underwriter who shall
have failed, otherwise than for some reason permitted under this Agreement, to purchase the amount
of Firm Shares agreed by such Underwriter to be purchased hereunder) be under any liability to the
Company (except to the extent provided in Section 6 hereof).
If Firm Shares to which a default relates are to be purchased by the non-defaulting
Underwriters or by any other party or parties, the Representatives or the Company shall have the
right to postpone the First Closing Date for not more than seven business days in order that the
necessary changes in the Registration Statement, in the Time of Sale Disclosure Package, in the
Prospectus or in any other documents, as well as any other arrangements, may be effected. As used
herein, the term “Underwriter” includes any person substituted for an Underwriter under this
Section 8.
9. Effective Date of this Agreement and Termination.
(a) This Agreement shall become effective at 10:00 a.m., Eastern time, on the first full
business day following the effective date of the Registration Statement, or at such earlier time
after the effective time of the Registration Statement as you in your discretion shall first
release the Securities for sale to the public; provided, that if the Registration Statement is
effective at the time this Agreement is executed, this Agreement shall become effective at such
time as you in your discretion shall first release the Securities for sale to the public. For the
purpose of this Section, the Securities shall be deemed to have been released for sale to the
public upon release by you of an electronic communication authorizing commencement of the offering
the Securities for sale by the Underwriters or other securities dealers. By giving notice as
hereinafter specified before the time this Agreement becomes effective, you, as Representatives of
the several Underwriters, or the Company, may prevent this Agreement from becoming effective
without liability of any party to any other party, except that the provisions of Section 4(h) and
Section 6 hereof shall at all times be effective.
(b) You, as Representatives of the several Underwriters, shall have the right to terminate
this Agreement by giving notice as hereinafter specified at any time at or
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prior to the First Closing Date, and the option referred to in Section 3(b), if exercised, may
be cancelled at any time prior to the Second Closing Date, if (i) the Company shall have failed,
refused or been unable, at or prior to such Closing Date, to perform any agreement on its part to
be performed hereunder, (ii) any other condition of the Underwriters’ obligations hereunder is not
fulfilled, (iii) trading on the Nasdaq National Market, New York Stock Exchange or the American
Stock Exchange shall have been wholly suspended, (iv) minimum or maximum prices for trading shall
have been fixed, or maximum ranges for prices for securities shall have been required, on the
Nasdaq National Market, New York Stock Exchange or the American Stock Exchange, by such Exchange or
by order of the Commission or any other Governmental Authority having jurisdiction, (v) a banking
moratorium shall have been declared by federal or state authorities, or (vi) there shall have
occurred any outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in your judgment, is material and adverse and makes it impractical or
inadvisable to proceed with the completion of the sale of and payment for the Securities. Any such
termination shall be without liability of any party to any other party except that the provisions
of Section 4(h) and Section 6 hereof shall at all times be effective.
(c) If you elect to prevent this Agreement from becoming effective or to terminate this
Agreement as provided in this Section, the Company, shall be notified promptly by you by telephone,
confirmed by letter. If the Company elects to prevent this Agreement from becoming effective, you
shall be notified by the Company by telephone, confirmed by letter.
10. Default by the Company. If the Company shall fail at the First Closing Date to sell and
deliver the number of Securities which it is obligated to sell hereunder, then this Agreement shall
terminate without any liability on the part of any non-defaulting party.
No action taken pursuant to this Section shall relieve the Company from liability, if any, in
respect of such default.
11. Notices. Except as otherwise provided herein, all communications hereunder shall be in
writing and, if to the Underwriters, shall be mailed or delivered to the Representatives c/o Xxxxx
Xxxxxxx & Co., 000 Xxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, and Pacific Growth Equities, LLC,
Xxx Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, except that notices given to an
Underwriter pursuant to Section 6 hereof shall be sent to such Underwriter at the address stated in
the Underwriters’ Questionnaire furnished by such Underwriter in connection with this offering with
a copy to Xxxxxx & Xxxxxxx LLP, 000 Xxxxxxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000, Attention:
Xxxx X. Xxxxxxxxx and Xxxxxxx X. Xxxxxxxx; if to the Company, shall be mailed or delivered to it at
0000 Xxxx Xxxxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000, Attention: August X. Xxxxxxx, with a copy to
Xxxxxx Godward LLP, 000 Xxxxxxxxxxx Xxxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxx C.T.
Linfield and Xxxxx X. Xxxxxxx. Any party to this Agreement may change such address for notices by
sending to the parties to this Agreement written notice of a new address for such purpose.
-31-
12. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective successors and assigns and the
controlling persons, officers and directors referred to in Section 6. Nothing in this Agreement is
intended or shall be construed to give to any other person, firm or corporation any legal or
equitable remedy or claim under or in respect of this Agreement or any provision herein contained.
The term “successors and assigns” as herein used shall not include any purchaser, as such
purchaser, of any of the Securities from any of the several Underwriters.
13. Absence of Fiduciary Relationship. The Company acknowledges and agrees that: (a) the
Representatives have been retained solely to act as an underwriter in connection with the sale of
the Securities and that no fiduciary, advisory or agency relationship between the Company and the
Representatives have been created in respect of any of the transactions contemplated by this
Agreement, irrespective of whether the Representatives have advised or are advising the Company on
other matters; (b) the price and other terms of the Securities set forth in this Agreement were
established by the Company following discussions and arms-length negotiations with the
Representatives and the Company is capable of evaluating and understanding and understands and
accepts the terms, risks and conditions of the transactions contemplated by this Agreement; (c) it
has been advised that the Representatives and their affiliates are engaged in a broad range of
transactions which may involve interests that differ from those of the Company and that the
Representatives have no obligation to disclose such interest and transactions to the Company by
virtue of any fiduciary, advisory or agency relationship; (d) it has been advised that the
Representatives are acting, in respect of the transactions contemplated by this Agreement, solely
for the benefit of the Representatives and the other Underwriters, and not on behalf of the
Company; (e) it waives to the fullest extent permitted by law, any claims it may have against the
Representatives for breach of fiduciary duty or alleged breach of fiduciary duty in respect of any
of the transactions contemplated by this Agreement and agrees that the Representatives shall have
no liability (whether direct or indirect) to the Company in respect of such a fiduciary duty claim
on behalf of or in right of the Company, including stockholders, employees or creditors of the
Company.
14. Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
15. Counterparts. This Agreement may be executed in one or more counterparts and, if executed
in more than one counterpart, the executed counterparts shall each be deemed to be an original and
all such counterparts shall together constitute one and the same instrument.
[Signature Page Follows]
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Please sign and return to the Company the enclosed duplicates of this letter whereupon
this letter will become a binding agreement between the Company and the several Underwriters in
accordance with its terms.
| Very truly yours, | ||||
| ALEXZA PHARMACEUTICALS, INC. |
||||
| By: | ||||
| Xxxxxx X. Xxxx | ||||
| President and Chief Executive Officer | ||||
Confirmed as of the date first
above mentioned, on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
above mentioned, on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
| Xxxxx Xxxxxxx & Co. | ||||
By
|
|
|||
| Managing Director | ||||
| Pacific Growth Equities, LLC. | ||||
By
|
|
|||
SCHEDULE I
| Underwriter | Number of Firm Shares (1) | |||
Xxxxx Xxxxxxx & Co. |
||||
Pacific Growth Equities, LLC |
||||
RBC Capital Markets Corporation |
||||
JMP Securities LLC |
||||
Total |
||||
| (1) | The Underwriters may purchase up to an additional ______ Option Shares, to the extent the option described in Section 3(b) of the Agreement is exercised, in the proportions and in the manner described in the Agreement. |
SCHEDULE II
Issuer-Represented General Free Writing Prospectuses
SCHEDULE III
Intellectual Property
EXHIBIT A
Lock-Up Agreement
EXHIBIT B
Opinion of Cooley Godward LLP
EXHIBIT C
Opinion of Xxxxx, Xxxxxx & XxXxxxxx, P.C.
EXHIBIT D
Opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation
