10,000,000 Avanir Pharmaceuticals, Inc. Common Stock ($0.0001 par value per share) UNDERWRITING AGREEMENT
Exhibit 1.1
($0.0001 par value per share)
May 6, 2010
XXXXXXXXX & COMPANY, INC.
As Representative of the several Underwriters
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representative of the several Underwriters
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Introductory. Avanir Pharmaceuticals, Inc., a Delaware corporation (the “Company”), proposes
to issue and sell to the several underwriters named in Schedule A (the “Underwriters”) an
aggregate of 10,000,000 shares of its common stock, par value $0.0001 per share (the “Shares”). The
10,000,000 Shares to be sold by the Company are called the “Firm Shares.” In addition, the Company has
granted to the Underwriters an option to purchase up to an additional 1,500,000 Shares as provided in
Section 2 hereof. The additional 1,500,000 Shares to be sold by the Company pursuant to such option
are collectively called the “Optional Shares.” The Firm Shares and, if and to the extent such
option is exercised, the Optional Shares are collectively called the “Offered Shares.” Jefferies &
Company, Inc. (“Jefferies”) has agreed to act as representative of the several Underwriters (in
such capacity, the “Representative”) in connection with the offering and sale of the Offered
Shares.
The Company has prepared and filed with the Securities and Exchange Commission (the
“Commission”) a shelf registration statement on Form S-3 (File No. 333-161789), which contains a
form of prospectus (the “Base Prospectus”) to be used in connection with the public offering and
sale of the Offered Shares. Such registration statement, as amended, including the financial
statements, exhibits and schedules thereto, in the form in which it was declared effective by the
Commission under the Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder (collectively, the “Securities Act”), including all documents incorporated or deemed to
be incorporated by reference therein and any information deemed to be a part thereof at the time of
effectiveness pursuant to Rule 430B under the Securities Act or the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Exchange
Act”), is called the “Registration Statement.” Any preliminary prospectus supplement to the Base
Prospectus that describes the Offered Shares and the offering thereof and is used prior to the
filing of the Prospectus (as defined below), together with the Base Prospectus, is called a
“preliminary prospectus.” As used herein, the term “Prospectus” shall mean the final prospectus
supplement to the Base Prospectus that describes the Offered Shares and the offering thereof (the
“Final Prospectus Supplement”), together with the Base Prospectus, in the form first used by the
Underwriters to confirm sales of the Offered Shares or in the form first made available to the
Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the
Securities Act. As used herein, “Applicable Time” is 10:00 a.m. (New York time) on May 6, 2010.
As used herein, “free writing prospectus” has
the meaning set forth in Rule 405 under the Securities Act, and “Time of Sale Prospectus”
means any preliminary prospectus, as amended or supplemented immediately prior to the Applicable
Time, together with the free writing prospectuses, if any, identified in Schedule B hereto,
each “road show” (as defined in Rule 433 under the Securities Act), if any, related to the offering
of the Shares contemplated hereby that is a “written communication” (as defined in Rule 405 under
the Securities Act), and the information relating to the number of Shares being offered, the price
per Share to the public and the estimated net proceeds to be received by the Company identified in
Schedule C hereto. As used herein, the terms “Registration Statement,” “preliminary
prospectus,” “Base Prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the
documents incorporated and deemed to be incorporated by reference therein. All references in this
Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus,
the Base Prospectus, the Time of Sale Prospectus or the Prospectus shall be deemed to mean and
include the filing of any document under the Exchange Act which is or is deemed to be incorporated
by reference in the Registration Statement, any preliminary prospectus, the Base Prospectus, the
Time of Sale Prospectus or the Prospectus, as the case may be. All references in this Agreement to
(i) the Registration Statement, any preliminary prospectus, the Base Prospectus or the Prospectus,
or any amendments or supplements to any of the foregoing, shall include any copy thereof filed with
the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval System (“XXXXX”)
and (ii) the Prospectus shall be deemed to include any “electronic Prospectus” provided for use in
connection with the offering of the Offered Shares as contemplated by Section 3(o) of this
Agreement.
All references in this Agreement to financial statements and schedules and other information
which are “contained,” “included” or “stated” in the Registration Statement, any preliminary
prospectus, the Base Prospectus, the Time of Sale Prospectus or the Prospectus (and all other
references of like import) shall be deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be incorporated by reference in the
Registration Statement or the Prospectus, as the case may be; and all references in this Agreement
to amendments or supplements to the Registration Statement, any preliminary prospectus, the Base
Prospectus, the Time of Sale Prospectus or the Prospectus, as the case may be, and all references
in this Agreement to amendments or supplements to the Registration Statement, any preliminary
prospectus, the Base Prospectus, the Time of Sale Prospectus or the Prospectus shall be deemed to
mean and include the filing of any document under the Exchange Act which is or is deemed to be
incorporated by reference in the Registration Statement, any preliminary prospectus, the Base
Prospectus, the Time of Sale Prospectus or the Prospectus, as the case may be.
In the event that the Company has only one subsidiary, then all references herein to
“subsidiaries” of the Company shall be deemed to refer to such single subsidiary, mutatis
mutandis.
The Company hereby confirms its agreements with the Underwriters as follows:
Section 1. Representations and Warranties of the Company
The Company hereby represents and warrants to, and covenants with, each Underwriter, as of the
date of this Agreement, as of the First Closing Date (as hereinafter defined) and as of each Option
Closing Date (as hereafter defined), if any, as follows:
(a) Compliance with Registration Requirements. The Registration Statement has been declared effective by the Commission under the
Securities Act. The Company has complied
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to the Commission’s satisfaction with all requests of
the Commission for additional or supplemental information. No stop order suspending the
effectiveness of the Registration Statement is in effect and no proceedings for such purpose
have been instituted or are pending or, to the knowledge of the Company, are contemplated or
threatened by the Commission.
Any preliminary prospectus and the Prospectus when filed complied in all material respects
with the Securities Act and, if filed by electronic transmission pursuant to XXXXX (except as
may be permitted by Regulation S-T under the Securities Act), was identical to the copy thereof
delivered to the Underwriters for use in connection with the offer and sale of the Offered
Shares. Each of the Registration Statement and any post-effective amendment thereto, at the
time it became effective and at all times during which a prospectus is required by the
Securities Act to be delivered (whether physically or through compliance with Rule 172 under
the Securities Act or any other applicable rule) in connection with any sale of the Offered
Shares (“Prospectus Delivery Period”), complied and will comply in all material respects with
the Securities Act and did not and will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make the statements
therein not misleading. As of the Applicable Time, the Time of Sale Prospectus (including any
preliminary prospectus wrapper) did not, and at the time of each sale of the Offered Shares and
at the First Closing Date (as defined in Section 2 hereof), the Time of Sale Prospectus, as
then amended or supplemented by the Company, if applicable, will not, contain any untrue
statement of a material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading. The
Prospectus (including any Prospectus wrapper), as amended or supplemented, as of its date and
at all times during the Prospectus Delivery Period, did not and will not contain any untrue
statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not
misleading. The representations and warranties set forth in the three immediately preceding
sentences do not apply to statements in or omissions from the Registration Statement or any
post-effective amendment thereto, or the Prospectus or the Time of Sale Prospectus, or any
amendments or supplements thereto, made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by the Representative expressly
for use therein, it being understood and agreed that the only such information furnished by the
Representative to the Company consists of the information described in Section 9(b) below.
There are no contracts or other documents required to be described in the Time of Sale
Prospectus or the Prospectus or to be filed as exhibits to the Registration Statement which
have not been described or filed as required.
The Company is not an “ineligible issuer” in connection with the offering of the Offered
Shares pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing
prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities
Act has been, or will be, filed with the Commission in accordance with the requirements of the
Securities Act. Each free writing prospectus that the Company has filed, or is required to
file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or behalf of or
used or referred to by the Company complies or will comply in all material respects with the
requirements of Rule 433 under the Securities Act including timely filing with the Commission
or retention where required and legending, and each such free writing prospectus, as of its
issue date and at all subsequent times through the completion of the public offer and sale of
the Offered Shares did not, does not and will not include any information that conflicted,
conflicts with or will conflict with the information contained in
the Registration Statement, the Prospectus or any preliminary prospectus, including any
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document incorporated by reference therein. Except for the free writing prospectuses, if any,
identified in Schedule B hereto, and electronic road shows, if any, furnished to you
before first use, the Company has not prepared, used or referred to, and will not, without your
prior consent, prepare, use or refer to, any free writing prospectus. No Road Show or
electronic road show will contain any statement of a material fact that does not appear in a
previously filed document under the Exchange Act which is or is deemed to be incorporated by
reference in the Registration Statement and the Base Prospectus.
(b) Offering Materials Furnished to Underwriters. The Company has delivered to the
Representative one conformed copy of the Registration Statement, each amendment thereto
(without exhibits) and of each consent and certificate of experts filed as a part thereof, and
any preliminary prospectuses, the Time of Sale Prospectus, the Prospectus, as amended or
supplemented, and any free writing prospectus reviewed and consented to by the Representative,
in such quantities and at such places as the Representative has reasonably requested for each
of the Underwriters.
(c) Distribution of Offering Material By the Company. The Company has not distributed and
will not distribute, prior to the later of (i) the expiration or termination of the option
granted to the several Underwriters in Section 2 hereof and (ii) the completion of the
Underwriters’ distribution of the Offered Shares, any offering material in connection with the
offering and sale of the Offered Shares other than the Time of Sale Prospectus, the Prospectus,
any preliminary prospectus or free writing prospectus reviewed and consented to by the
Representative, or the Registration Statement.
(d) The Underwriting Agreement. This Agreement has been duly authorized, executed and
delivered by, and is a valid and binding agreement of, the Company, enforceable in accordance
with its terms, except as rights to indemnification hereunder may be limited by applicable law
and except as the enforcement hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles.
(e) Authorization of the Offered Shares. The Offered Shares have been duly authorized for
issuance and sale pursuant to this Agreement and, when issued and delivered by the Company
pursuant to this Agreement, will be validly issued, fully paid and nonassessable, and the
issuance and sale of the Offered Shares is not subject to any preemptive rights, rights of
first refusal or other similar rights to subscribe for or purchase the Offered Shares.
(f) No Applicable Registration or Other Similar Rights. There are no persons with
registration or other similar rights to have any equity or debt securities registered for sale
under the Registration Statement or included in the offering contemplated by this Agreement.
(g) No Material Adverse Change. Except as otherwise disclosed in the Time of Sale
Prospectus, subsequent to the respective dates as of which information is given in the Time of
Sale Prospectus: (i) there has been no material adverse change, or any development that could
reasonably be expected to result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business, operations or prospects, whether or not arising from
transactions in the ordinary course of business, of the Company and its subsidiaries,
considered as one entity (any such change is called a “Material Adverse Change”); (ii) the
Company and its subsidiaries, considered as one entity, have not incurred any material
liability or obligation, indirect, direct or contingent, not in the ordinary course of business
nor entered into any material transaction or agreement not in the ordinary course of
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business; and (iii) there has been no dividend or distribution of any kind declared, paid or made by the
Company or, except for dividends paid to the Company or other subsidiaries, any of its
subsidiaries on any class of capital stock or repurchase or redemption by the Company or any of
its subsidiaries of any class of capital stock.
(h) Independent Accountants. KMJ Xxxxxx & Company LLP, who have expressed their opinion
with respect to the financial statements (which term as used in this Agreement includes the
related notes thereto) and supporting schedules, if any, filed with the Commission as a part of
the Registration Statement and included in the Prospectus and Time of Sale Prospectus (each, an
“Applicable Prospectus” and collectively, the “Applicable Prospectuses”), are (i) independent
public or certified public accountants as required by the Securities Act and the Exchange Act,
(ii) in compliance with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X and (iii) a registered public accounting firm as
defined by the Public Company Accounting Oversight Board (the “PCAOB”) whose registration has
not been suspended or revoked and who has not requested such registration to be withdrawn.
(i) Preparation of the Financial Statements. The financial statements filed with the
Commission as a part of the Registration Statement and included in the Time of Sale Prospectus
and the Prospectus present fairly the consolidated financial position of the Company and its
subsidiaries as of and at the dates indicated and the results of their operations and cash
flows for the periods specified. The supporting schedules, if any, included in the
Registration Statement present fairly the information required to be stated therein. Such
financial statements have been prepared in conformity with generally accepted accounting
principles as applied in the United States applied on a consistent basis throughout the periods
involved, except as may be expressly stated in the related notes thereto. No other financial
statements or supporting schedules are required to be included in the Registration Statement or
any Applicable Prospectus. No person who has been suspended or barred from being associated
with a registered public accounting firm, or who has failed to comply with any sanction
pursuant to Rule 5300 promulgated by the PCAOB, has participated in or otherwise aided the
preparation of, or audited, the financial statements, supporting schedules, if any, or other
financial data filed with the Commission as a part of the Registration Statement and included
in any Applicable Prospectus.
(j) Company’s Accounting System. The Company and each of its subsidiaries make and keep accurate books and records and
maintain a system of internal accounting controls sufficient to provide reasonable assurance
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 as applied 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. There has not been and is no
material weakness in the Company’s internal control over financial reporting (whether or not
remediated) and since September 30, 2009, there has been no change in the Company’s internal
control over financial reporting that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial reporting.
(k) Incorporation and Good Standing of the Company and its Subsidiaries. Each of the
Company and its subsidiaries has been duly incorporated or organized, as the case may be,
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and is validly existing as a corporation, partnership or limited liability company, as applicable,
in good standing under the laws of the jurisdiction of its incorporation or organization and
has the power and authority (corporate or other) to own, lease and operate its properties and
to conduct its business as described in each Applicable Prospectus and, in the case of the
Company, to enter into and perform its obligations under this Agreement. Each of the Company
and each subsidiary is duly qualified as a foreign corporation, partnership or limited
liability company, as applicable, to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to be so qualified and
in good standing or have such power or authority would not, individually or in the aggregate,
be reasonably expected to result in a Material Adverse Change. All of the issued and
outstanding capital stock or other equity or ownership interests of each subsidiary have been
duly authorized and validly issued, are fully paid and nonassessable and are owned by the
Company, directly or through subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance or adverse claim. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than (i) the subsidiaries listed
in Exhibit 21 to the Company’s Annual Report on Form 10-K for the fiscal year ended September
30, 2009 and (ii) such other entities omitted from Exhibit 21 which, when such omitted entities
are considered in the aggregate as a single subsidiary, would not constitute a “significant
subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X.
(l) Capitalization and Other Capital Stock Matters. The authorized, issued and
outstanding capital stock of the Company is as set forth in each Applicable Prospectus under
the caption “Capitalization” or other similar headings (other than for subsequent issuances, if
any, pursuant to employee benefit plans described in the Time of Sale Prospectus or upon the
exercise of outstanding options or warrants or the vesting of restricted stock units described
in each Applicable Prospectus). The Shares (including the Offered Shares) conform in all
material respects to the description thereof contained in the Time of Sale Prospectus. All of
the issued and outstanding Shares have been duly authorized and validly issued, are fully paid
and nonassessable and have been issued in compliance with federal and state securities laws.
None of the outstanding Shares was issued in violation of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities of the Company. There are no authorized or
outstanding options, warrants, preemptive rights, rights of first refusal or other rights to
purchase, or equity or debt securities convertible into or exchangeable or exercisable for, any
capital stock of the Company or any of its subsidiaries other than those described in each
Applicable Prospectus. The description of the Company’s stock option, stock bonus and other
equity incentive plans or arrangements, and the options or other rights granted thereunder, set
forth in each Applicable Prospectus accurately and fairly presents the information required to
be shown with respect to such plans, arrangements, options and rights.
Except as described in the Prospectus, the Company has not sold or issued any Shares
during the six-month period preceding the date of the Prospectus, including any sales pursuant
to Rule 144A under, or Regulations D or Regulation S of, the Securities Act other than Shares
issued pursuant to employee benefit plans, qualified stock option and equity incentive plans or
other employee compensation plans or pursuant to outstanding options, rights or warrants.
(m) Stock Exchange Listing. The Shares are registered pursuant to Section 12(g) of the
Exchange Act and are listed on the Nasdaq Global Market, and the Company has taken no action
designed to, or likely to have the effect of, terminating the registration of the Shares
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under the Exchange Act or delisting the Shares from the Nasdaq Global Market, nor has the Company
received any notification that the Commission or the Nasdaq Global Market is contemplating
terminating such registration or listing.
(n) Non-Contravention of Existing Instruments; No Further Authorizations or Approvals
Required. Neither the Company nor any of its subsidiaries is in violation of its charter or
bylaws or similar organizational document, as applicable, or is in default (or, with the giving
of notice or lapse of time, would be in default) (“Default”) under any indenture, mortgage,
loan or credit agreement, note, contract, franchise, lease or other instrument to which the
Company or any of its subsidiaries is a party or by which it or any of them may be bound
(including, without limitation, any credit agreement, indenture, pledge agreement, security
agreement or other instrument or agreement evidencing, guaranteeing, securing or relating to
indebtedness of the Company or any of its subsidiaries ), or to which any of the property or
assets of the Company or any of its subsidiaries is subject (each, an “Existing Instrument”),
except for such Defaults as would not, individually or in the aggregate, result in a Material
Adverse Change. The Company’s execution, delivery and performance of this Agreement,
consummation of the transactions contemplated hereby and by each Applicable Prospectus and the
issuance and sale of the Offered Securities (i) have been duly authorized by all necessary
corporate action and will not result in any violation of the provisions of the charter or
bylaws or similar organizational document of the Company or any subsidiary, as applicable, (ii)
will not conflict with or constitute a breach of, or Default or a Debt Repayment Triggering
Event (as defined below) under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to,
or require the consent of any other party to, any Existing Instrument and (iii) will not result
in any violation of any law, administrative regulation or administrative or court decree
applicable to the Company or any subsidiary, except, in case of each of
clauses (ii) and (iii) above, for any such conflict, breach, violation, Default, lien,
charge or encumbrance that would not, individually or in the aggregate, reasonably be expected
to result in a Material Adverse Change. No consent, approval, authorization or other order of,
or registration or filing with, any court or other governmental or regulatory authority or
agency, is required for the Company’s execution, delivery and performance of this Agreement and
consummation of the transactions contemplated hereby and by each Applicable Prospectus, except
such as have been obtained or made by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and from the Financial Industry
Regulatory Authority, Inc. (“FINRA”). As used herein, a “Debt Repayment Triggering Event”
means any event or condition which gives, or with the giving of notice or lapse of time would
give, the holder of any note, debenture or other evidence of indebtedness (or any person acting
on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or
a portion of such indebtedness by the Company or any of its subsidiaries.
(o) No Material Actions or Proceedings. Except as otherwise disclosed in each Applicable
Prospectus, there are no legal or governmental actions, suits or proceedings pending or, to the
Company’s knowledge, threatened (i) against or affecting the Company or any of its
subsidiaries, (ii) which have as the subject thereof any officer or director of, or property
owned or leased by, the Company or any of its subsidiaries or (iii) relating to environmental
or discrimination matters, where in any such case (A) there is a reasonable possibility that
such action, suit or proceeding might be determined adversely to the Company, such subsidiary
or such officer or director, (B) any such action, suit or proceeding, if so determined
adversely, would reasonably be expected to result in a Material Adverse Change or adversely
affect the consummation of the transactions contemplated by this
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Agreement or (C) any such action, suit or proceeding is or would be material in the context of the sale of Shares. No
material labor dispute with the employees of the Company or any of its subsidiaries, or with
the employees of any principal supplier, manufacturer, customer or contractor of the Company,
exists or, to the Company’s knowledge, is threatened or imminent.
(p) Intellectual Property Rights. The Company and its subsidiaries own, possess or
license, and otherwise have legally enforceable rights to use all patents, patent applications,
trade and service marks, trade and service xxxx registrations, trade names, copyrights,
licenses, inventions, trade secrets, technology and know-how, except with regard to
off-the-shelf software provided by third parties (collectively, the “Intellectual Property
Rights”) necessary for the conduct of the Company’s business as now conducted or, to the
knowledge of the Company, as proposed in the Applicable Prospectuses to be conducted. Except
as disclosed in the Applicable Prospectus, (i) to the Company’s knowledge, there are no rights
of third parties to any such Intellectual Property Rights that conflict with the Company’s use
or proposed use of any such Intellectual Property Rights; (ii) the Company is not aware of any
material infringement by third parties of any such Intellectual Property Rights; (iii) there is
no pending or, to the Company’s knowledge, threatened, action, suit, proceeding or claim by
others challenging the Company’s rights in or to use any such Intellectual Property Rights, and
the Company is unaware of any facts which would form a reasonable basis for any such claim;
(iv) there is no pending or, to the Company’s knowledge, threatened, action, suit, proceeding
or claim by others challenging the validity, enforceability, or scope of any such Intellectual
Property Rights, and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (v) there is no pending or threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise violates any patent,
trademark, copyright, trade secret or other proprietary rights of others, and the Company is
unaware of any other fact which would form a reasonable basis for any such claim; (vi) to the
knowledge of the Company, there is no patent or published patent application which contains
claims that dominate or may dominate any Intellectual Property Rights described in the
Applicable Prospectuses as being owned by or licensed to the Company or that interferes with
the issued or pending claims of any such Intellectual Property Rights; and (vii) there is no
prior art of which the Company is aware that may render any patent held or licensed by the
Company invalid or any patent application held by the Company unpatentable which has not been
disclosed to the appropriate patent office(s) to the extent such disclosure may be required.
(q) All Necessary Permits, etc. The Company and each subsidiary possess such valid and
current certificates, authorizations or permits issued by the appropriate state, federal or
foreign regulatory agencies or bodies necessary to conduct their respective businesses, except
for such certificates, authorizations or permits which the failure to obtain would not
reasonably be expected to result in a Material Adverse Change, and neither the Company nor any
subsidiary has received, or has any reason to believe that it will receive, any notice of
proceedings relating to the revocation or modification of, or non-compliance with, any such
certificate, authorization or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could result in a Material Adverse Change.
(r) Title to Properties. The Company and each of its subsidiaries has good and marketable
title to all of the real and personal property and other assets reflected as owned in the
financial statements referred to in Section 1(i) above (or elsewhere in any Applicable
Prospectus), in each case free and clear of any security interests, mortgages, liens,
encumbrances, equities, adverse claims and other defects, except such as do not materially
8
and adversely affect the value of such property and do not materially
interfere with the use made or proposed to be made of such property by the Company or such subsidiary. The real property,
improvements, equipment and personal property held under lease by the Company or any subsidiary
are held under valid and enforceable leases, with such exceptions as are not material and do
not materially interfere with the use made or proposed to be made of such real property,
improvements, equipment or personal property by the Company or such subsidiary.
(s) Tax Law Compliance. The Company and its subsidiaries have filed all necessary
federal, state and foreign income and franchise tax returns or have properly filed requested
extensions thereof and have paid all taxes required to be paid by any of them and, if due and
payable, any related or similar assessment, fine or penalty levied against any of them. The
Company has made adequate charges, accruals and reserves in the applicable financial statements
referred to in Section 1(i) above in respect of all federal, state and foreign income and
franchise taxes for all periods as to which the tax liability of the Company or any of its
subsidiaries has not been finally determined.
(t) Company Not an “Investment Company”. The Company is not, and will not be, either
after receipt of payment for the Offered Shares or after the application of the proceeds
therefrom as described under “Use of Proceeds” in each Applicable Prospectus, an “investment
company” within the meaning of Investment Company Act of 1940, as amended (the “Investment
Company Act”), and will conduct its business in a manner so that it will not become subject to
the Investment Company Act.
(u) Insurance. Each of the Company and its subsidiaries are insured by institutions
believed to be recognized, financially sound and reputable, with policies in such amounts and
with such deductibles and covering such risks as are generally deemed adequate and customary
for their businesses including, but not limited to, policies covering real and personal
property owned or leased by the Company and its subsidiaries against theft, damage,
destruction, acts of vandalism and policies covering the Company and its subsidiaries for
product liability claims and clinical trial liability claims. The Company has no reason to
believe that it or any subsidiary will not be able (i) to renew its existing insurance coverage
as and when such policies expire or (ii) to obtain comparable coverage from similar
institutions, in each case as may be necessary or appropriate to conduct its business as now
conducted and at a cost that would not result in a Material Adverse Change. Neither of the
Company nor any subsidiary has been denied any insurance coverage which it has sought or for
which it has applied.
(v) No Price Stabilization or Manipulation; Compliance with Regulation M. The Company has
not taken, directly or indirectly, any action designed to or that might be reasonably expected
to cause or result in stabilization or manipulation of the price of the Shares or any other
“reference security” (as defined in Rule 100 of Regulation M under the 1934 Act (“Regulation
M”)) whether to facilitate the sale or resale of the Offered Shares or otherwise, and has taken
no action which would directly or indirectly violate Regulation M. The Company acknowledges
that the Underwriters may engage in passive market making transactions in the Offered Shares on
the Nasdaq Global Market in accordance with Regulation M.
(w) Related Party Transactions. There are no business relationships or related-party
transactions involving the Company or any of its subsidiaries or any other person required to
be described in each Applicable Prospectus which have not been described as required. The
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Time of Sale Prospectus contains in all material respects the same description of the matters set
forth in the preceding sentence contained in the Prospectus.
(x) S-3 Eligibility. At the time the Registration Statement was originally declared
effective and at the time the Company’s Annual Report on Form 10-K for the year ended September
30, 2009 (the “Annual Report”) was filed with the Commission, the Company met the then
applicable requirements for use of Form S-3 under the Securities Act. The Company meets
the requirements for use of Form S-3 under the Securities Act specified in FINRA Conduct
Rule 5110(b)(7)(C)(i).
(y) Exchange Act Compliance. The documents incorporated or deemed to be incorporated by
reference in the Prospectus, at the time they were or hereafter are filed with the Commission,
complied and will comply in all material respects with the requirements of the Exchange Act,
and, when read together with the other information in the Prospectus, at the time the
Registration Statement and any amendments thereto become effective and at the First Closing
Date and the applicable Option Closing Date, as the case may be, will not contain an untrue
statement of a material fact or omit to state a material fact required to be stated therein or
necessary to make the fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
(z) FINRA Matters. All of the information provided to the Underwriters or to counsel for
the Underwriters by the Company, its officers and directors and the holders of any securities
(debt or equity) or options to acquire any securities of the Company in connection with
letters, filings or other supplemental information provided to FINRA pursuant to FINRA Rule
5110 or NASD Conduct Rule 2720 is true, complete and correct.
(aa) Parties to Lock-Up Agreements. Each of the Company’s directors and executive
officers and each of the other persons and entities listed in Exhibit C has executed
and delivered to Jefferies a lock-up agreement in the form of Exhibit D hereto.
Exhibit C hereto contains a true, complete and correct list of all directors and
executive officers of the Company and any stockholder who both (i) beneficially owns more than
5% of the outstanding Shares and (ii) is affiliated with any of the Company’s directors. If any
additional persons shall become directors or executive officers of the Company prior to the end
of the Company Lock-up Period (as defined below), the Company shall cause each such person,
prior to or contemporaneously with their appointment or election as a director or executive
officer of the Company, to execute and deliver to Jefferies an agreement in the form attached
hereto as Exhibit D.
(bb) Statistical and Market-Related Data. The statistical, demographic and market-related data
included in the Registration Statement and each Applicable Prospectus are based on or derived
from sources that the Company believes to be reliable and accurate or represent the Company’s
good faith estimates that are made on the basis of data derived from such sources.
(cc) No Unlawful Contributions or Other Payments. Neither the Company nor any of its
subsidiaries nor, to the Company’s knowledge, any employee or agent of the Company or any
subsidiary, has made any contribution or other payment to any official of, or candidate for,
any federal, state or foreign office in violation of any law or of the character required to be
disclosed in the Registration Statement and each Applicable Prospectus.
10
(dd) Disclosure Controls and Procedures; Deficiencies in or Changes to Internal Control
Over Financial Reporting. The Company has established and maintains disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), which (i) are designed
to ensure that material information relating to the Company, including its consolidated
subsidiaries, is made known to the Company’s principal executive officer and its principal
financial officer by others within those entities, particularly during the periods in which the
periodic reports required under the Exchange Act are being prepared; (ii) have been evaluated
by management of the Company for effectiveness as of the end of the Company’s most recent
fiscal quarter; and (iii) are effective in all material respects to perform the functions for
which they were established. The Company is not aware of (i) any significant deficiencies or
material weaknesses in the design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the Company’s ability to record, process,
summarize and report financial information or (ii) any fraud, whether or not material, that
involves management or other employees who have a significant role in the Company’s internal
control over financial reporting. The Company is not aware of any change in its internal
control over financial reporting that has occurred during its most recent fiscal quarter that
has materially affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting.
(ee) Compliance with Environmental Laws. Except as described in each Applicable
Prospectus and except as would not, singly or in the aggregate, result in a Material Adverse
Change, (i) neither the Company nor any of its subsidiaries is in violation of any applicable
federal, state, local or foreign statute, law, rule, regulation, ordinance, code, policy or
rule of common law or any binding and enforceable judicial or administrative interpretation
thereof, including any judicial or administrative order, consent, decree or judgment, relating
to pollution or protection of human health, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, “Hazardous Materials”) or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous
Materials (collectively, “Environmental Laws”), (ii) the Company and its subsidiaries have all
permits, authorizations and approvals required under any applicable Environmental Laws and are
each in compliance with their requirements, (iii) there are no pending or, to the knowledge of
the Company, threatened administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its subsidiaries and (iv) there
are no events or circumstances that might reasonably be expected to form the basis of an order
for clean-up or remediation, or an action, suit or proceeding by any private party or
governmental body or agency, or against or affecting the Company or any of its subsidiaries
relating to Hazardous Materials or any Environmental Laws.
(ff) Periodic Review of Costs of Environmental Compliance. In the ordinary course of its
business, the Company conducts a periodic review of the effect of Environmental Laws on the
business, operations and properties of the Company and its subsidiaries, in the course of which
it identifies and evaluates associated costs and liabilities (including, without limitation, to
the extent applicable, any capital or operating expenditures required for clean-up, closure of
properties or compliance with
applicable Environmental Laws or any permit, license or approval, any related constraints
on operating activities and any potential liabilities to third parties). On the basis of such
review and the amount of its established reserves, if any, the
11
Company has reasonably concluded that such associated costs and liabilities would not, individually or in the aggregate, result
in a Material Adverse Change.
(gg) ERISA Compliance. Except as otherwise disclosed in the Time of Sale Prospectus, the
Company and its subsidiaries and any “employee benefit plan” (as defined under the Employee
Retirement Income Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (collectively, “ERISA”)) established or maintained by the Company,
its subsidiaries or their “ERISA Affiliates” (as defined below) are in compliance in all
material respects with ERISA. “ERISA Affiliate” means, with respect to the Company or a
subsidiary, any member of any group of organizations described in Sections 414(b),(c),(m) or
(o) of the Internal Revenue Code of 1986, as amended, and the regulations and published
interpretations thereunder (the “Code”) of which the Company or such subsidiary is a member.
No “reportable event” (as defined under ERISA) has occurred or is reasonably expected to occur
with respect to any “employee benefit plan” established or maintained by the Company, its
subsidiaries or any of their ERISA Affiliates. No “employee benefit plan” established or
maintained by the Company, its subsidiaries or any of their ERISA Affiliates, if such “employee
benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as
defined under ERISA). Neither the Company, its subsidiaries nor any of their ERISA Affiliates
has incurred or reasonably expects to incur any liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections
412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained
by the Company, its subsidiaries or any of their ERISA Affiliates that is intended to be
qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether by
action or failure to act, which would cause the loss of such qualification.
(hh) Brokers. Except for the underwriting discounts and commissions payable to the
Underwriters as described in the Time of Sale Prospectus and the Prospectus, there is no
broker, finder or other party that is entitled to receive from the Company any brokerage or
finder’s fee or other fee or commission as a result of any transactions contemplated by this
Agreement.
(ii) No Outstanding Loans or Other Extensions of Credit. Since the adoption of Section
13(k) of the Exchange Act, neither the Company nor any of its subsidiaries has extended or
maintained credit, arranged for the extension of credit, or renewed any extension of credit, in
the form of a personal loan, to or for any director or executive officer (or equivalent
thereof) of the Company and/or such subsidiary except for such extensions of credit as are
expressly permitted by Section 13(k) of the Exchange Act.
(jj) Compliance with Laws
.. The Company has not been advised, and has no reason to believe, that it and each of its
subsidiaries are not conducting business in compliance with all applicable laws, rules and
regulations of the jurisdictions in which it is conducting business, except where failure to be
so in compliance would not result in a Material Adverse Change. Except as described in the
Applicable Prospectus, each of the Company and its subsidiaries: (A) is and at all times has
been in material compliance with all statutes, rules or regulations 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 under development, manufactured or distributed by the Company (“Applicable Laws”);
(B) has not received any FDA Form 483, notice of adverse finding, warning letter, untitled
letter or other correspondence or notice from the U.S. Food and Drug Administration (the “FDA”)
or any other federal, state, local or foreign governmental or
12
regulatory authority alleging or asserting material noncompliance with any Applicable Laws or any licenses, certificates,
approvals, clearances, authorizations, permits and supplements or amendments thereto required
by any such Applicable Laws (“Authorizations”); (C) possesses all material Authorizations and
such Authorizations are valid and in full force and effect and the Company is not in material
violation of any term of any such Authorizations; (D) has not received notice of any claim,
action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from
the FDA or any other federal, state, local or foreign governmental or regulatory authority or
third party alleging that any product operation or activity is in material violation of any
Applicable Laws or Authorizations and has no knowledge that the FDA or any other federal,
state, local or foreign governmental or regulatory authority or third party is considering any
such claim, litigation, arbitration, action, suit, investigation or proceeding; (E) has not
received notice that the FDA or any other federal, state, local or foreign governmental or
regulatory authority has taken, is taking or intends to take action to limit, suspend, modify
or revoke any material Authorizations and has no knowledge that the FDA or any other federal,
state, local or foreign governmental or regulatory authority is considering such action; (F)
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 materially
complete and correct on the date filed (or were corrected or supplemented by a subsequent
submission); and (G) has not, either voluntarily or involuntarily, initiated, conducted, or
issued or caused to be initiated, conducted or issued, any recall, market withdrawal or
replacement, safety alert, “dear doctor” letter, or other notice or action relating to the
alleged lack of safety or efficacy of any product or any alleged product defect or violation
and, to the Company’s knowledge, no third party has initiated, conducted or intends to initiate
any such notice or action.
(kk) Clinical Studies. The studies, tests and preclinical and clinical trials conducted
by or on behalf of the Company or any of its subsidiaries 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 (collectively, “FFDCA”); the descriptions of the results of
such studies, tests and trials contained in the Registration Statement and the Applicable
Prospectus are accurate and complete and fairly present the data derived from such studies,
tests and trials; the Company is not aware of any studies, tests or trials, the results of
which the Company believes reasonably call into question the study, test, or trial results
described or
referred to in the Registration Statement, the Applicable Prospectus when viewed in the
context in which such results are described and the clinical state of development; and, since
December 31, 2005, the Company has not received any notices or correspondence from the FDA or
any other federal, state, local or foreign governmental or regulatory 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.
(ll) Dividend Restrictions. No subsidiary of the Company is prohibited or restricted,
directly or indirectly, from paying dividends to the Company, or from making any other
distribution with respect to such subsidiary’s equity securities or from repaying to the
Company or any other subsidiary of the Company any amounts that may from time to time become
due under any loans or advances to such subsidiary from the Company or from transferring any
property or assets to the Company or to any other subsidiary.
13
(mm) Foreign Corrupt Practices Act. Neither the Company nor any of its subsidiaries nor,
to the knowledge of the Company, any director, officer, agent, employee, affiliate or other
person acting on behalf of the Company or any of its subsidiaries is aware of or has taken any
action, directly or indirectly, that has resulted or would result in a violation of the Foreign
Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the
“FCPA”), including, without limitation, making use of the mails or any means or instrumentality
of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or
authorization of the payment of any money, or other property, gift, promise to give, or
authorization of the giving of anything of value to any “foreign official” (as such term is
defined in the FCPA) or any foreign political party or official thereof or any candidate for
foreign political office, in contravention of the FCPA; and the Company and its subsidiaries
and, to the knowledge of the Company, the Company’s affiliates have conducted their respective
businesses in compliance with the FCPA and have instituted and maintain policies and procedures
designed to ensure, and which are reasonably expected to continue to ensure, continued
compliance therewith.
(nn) Government Contracting. No payment has been made by the Company or its subsidiaries,
or by any person authorized to act on their behalf, to any person in connection with any
contracts with any governmental entity or regulatory agency (“Government Contracts”), in
violation of applicable procurement laws or regulations. There are no outstanding claims
against the Company or any subsidiary, either by the United States government or by any prime
contractor, subcontractor, vendor or other third party, arising under or relating to any
Government Contract. There is no suit or investigation pending and, to the Company’s
knowledge, no suit or investigation threatened against the Company or any subsidiary with
respect to any Government Contract. The Company is not a party to any material Government
Contract.
(oo) Money Laundering Laws. The operations of the Company and its subsidiaries are, and
have been conducted at all times, in compliance with applicable financial recordkeeping and
reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the money laundering statutes of all applicable jurisdictions, the rules and
regulations thereunder and any related or similar applicable rules, regulations or guidelines,
issued, administered or enforced by any governmental agency (collectively, the “Money
Laundering Laws”) and no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of
the Company, threatened.
(pp) OFAC. Neither the Company nor any of its subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee, affiliate or person acting on behalf of the
Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by
the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company
will not directly or indirectly use the proceeds of this offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner or other person
or entity, for the purpose of financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
Any certificate signed by any officer of the Company or any of its subsidiaries and
delivered to the Representative or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters covered
thereby.
14
The Company acknowledges that the Underwriters and, for purposes of the opinions to be
delivered pursuant to Section 6 hereof, counsel to the Company and counsel to the Underwriters,
will rely upon the accuracy and truthfulness of the foregoing representations and hereby
consents to such reliance.
Section 2. Purchase, Sale and Delivery of the Offered Shares.
(a) The Firm Shares. Upon the terms herein set forth, the Company agrees to issue and
sell to the several Underwriters an aggregate of 10,000,000 Firm Shares. On the basis of the
representations, warranties and agreements herein contained, and upon the terms but subject to
the conditions herein set forth, the Underwriters agree, severally and not jointly, to purchase
from the Company the respective number of Firm Shares set forth opposite their names on
Schedule A. The purchase price per Firm Share to be paid by the several Underwriters
to the Company shall be $2.67 per share.
(b) The First Closing Date. Delivery of certificates for the Firm Shares to be purchased
by the Underwriters and payment therefor shall be made at the offices of Jefferies, 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx (or such other place as may be agreed to by the Company and the
Representative) at 9:00 a.m. New York time, on May 11, 2010, or such other time and date not
later than 1:30 p.m. New York time, on May 24, 2010, as the Representative shall designate by
notice to the Company (the time and date of such closing are called the “First Closing Date”).
The Company hereby acknowledges that circumstances under which the Representative may provide
notice to postpone the First Closing Date as originally scheduled include, but are in no way
limited to, any determination by the Company or the Representative to recirculate to the public
copies of an amended or supplemented Prospectus or a delay as contemplated by the provisions of
Section 10.
(c) The Optional Shares; Option Closing Date. In addition, on the basis of the representations, warranties and agreements herein
contained, and upon the terms but subject to the conditions herein set forth, the Company
hereby grants an option to the several Underwriters to purchase, severally and not jointly, up
to an aggregate of 1,500,000 Optional Shares from the Company at the purchase price per share to be
paid by the Underwriters for the Firm Shares. The option granted hereunder is for use by the
Underwriters solely in covering any over-allotments in connection with the sale and
distribution of the Firm Shares. The option granted hereunder may be exercised at any time and
from time to time in whole or in part upon notice by the Representative to the Company, which
notice may be given at any time within 30 days from the date of this Agreement. Such notice
shall set forth (i) the aggregate number of Optional Shares as to which the Underwriters are
exercising the option, (ii) the names and denominations in which the certificates for the
Optional Shares are to be registered and (iii) the time, date and place at which such
certificates will be delivered (which time and date may be simultaneous with, but not earlier
than, the First Closing Date; and in the event that such time and date are simultaneous with
the First Closing Date, the term “First Closing Date” shall refer to the time and date of
delivery of certificates for the Firm Shares and such Optional Shares). Any such time and date
of delivery, if subsequent to the First Closing Date, is called an “Option Closing Date” and
shall be determined by the Representative and shall not be earlier than three nor later than
five full business days after delivery of such notice of exercise. If any Optional Shares are
to be purchased, each Underwriter agrees, severally and not jointly, to purchase the number of
Optional Shares (subject to such adjustments to eliminate fractional shares as the
Representative may determine) that bears the same proportion to the total number of Optional
Shares to be purchased as the number of Firm Shares set forth on Schedule A opposite
the name of such
15
Underwriter bears to the total number of Firm Shares. The Representative may
cancel the option at any time prior to its expiration by giving written notice of such
cancellation to the Company.
(d) Public Offering of the Offered Shares. The Representative hereby advises the Company
that the Underwriters intend to offer for sale to the public, initially on the terms set forth
in the Time of Sale Prospectus and the Prospectus, their respective portions of the Offered
Shares as soon after this Agreement has been executed as the Representative, in its sole
judgment, has determined is advisable and practicable.
(e) Payment for the Offered Shares. Payment for the Offered Shares shall be made at the
First Closing Date (and, if applicable, at each Option Closing Date) by wire transfer of
immediately available funds to the order of the Company.
It is understood that the Representative has been authorized, for its own account and the
accounts of the several Underwriters, to accept delivery of and receipt for, and make payment
of the purchase price for, the Firm Shares and any Optional Shares the Underwriters have agreed
to purchase. Jefferies, individually and not as the Representative of the Underwriters, may
(but shall not be obligated to) make payment for any Offered Shares to be purchased by any
Underwriter whose funds shall not have been received by the Representative by the First Closing
Date or the applicable Option Closing Date, as the case may be, for the account of such
Underwriter, but any such payment shall not relieve such Underwriter from any of its
obligations under this Agreement.
(f) Delivery of the Offered Shares. The Company shall deliver, or cause to be delivered,
to the Representative for the accounts of the several Underwriters certificates for the Firm
Shares at the First Closing Date, against the irrevocable release of a wire transfer of
immediately available funds for the amount of the purchase price therefor. The Company shall
also deliver, or cause to be delivered, to the Representative for the accounts of the several
Underwriters, certificates for the Optional Shares the Underwriters have agreed to purchase at
the First Closing Date or the applicable Option Closing Date, as the case may be, against the
irrevocable release of a wire transfer of immediately available funds for the amount of the
purchase price therefor. If the Representative so elects, the certificates for the Offered
Shares shall be in definitive form and registered in such names and denominations as the
Representative shall have requested at least two full business days prior to the First Closing
Date (or the applicable Option Closing Date, as the case may be) and shall be made available
for inspection on the business day preceding the First Closing Date (or the applicable Option
Closing Date, as the case may be) at a location in New York City as the Representative may
designate. Time shall be of the essence, and delivery at the time and place specified in this
Agreement is a further condition to the obligations of the Underwriters.
Section 3. Additional Covenants of the Company.
The Company further covenants and agrees with each Underwriter as follows:
(a) Delivery of Time of Sale Prospectus and Prospectus. The Company shall furnish to you
in New York City, without charge, prior to 10:00 a.m. New York City time on the business day
next succeeding the date of this Agreement and during the period mentioned in Section 3(e) or
3(f) below, as many copies of the Time of Sale Prospectus, the Prospectus and
16
any supplements
and amendments thereto or to the Registration Statement as you may reasonably request.
(b) Representative’s Review of Proposed Amendments and Supplements. During the Prospectus
Delivery Period, prior to amending or supplementing the Registration Statement, any preliminary
prospectus, the Time of Sale Prospectus or the Prospectus (including any amendment or
supplement through incorporation by reference of any report filed under the Exchange Act), the
Company shall furnish to the Representative for review, a reasonable amount of time prior to
the proposed time of filing or use thereof, a copy of each such proposed amendment or
supplement, and the Company shall not file or use any such proposed amendment or supplement
without the Representative’s consent, and to file with the Commission within the applicable
period specified in Rule 424(b) under the Securities Act any prospectus required to be filed
pursuant to such Rule.
(c) Free Writing Prospectuses. The Company shall furnish to the Representative for
review, a reasonable amount of time prior to the proposed time of filing or use thereof, a copy
of each proposed free writing prospectus or any amendment or supplement thereto to be prepared
by or on behalf of, used by, or referred to by the Company and the Company shall not file,
use or refer to any proposed free writing prospectus or any amendment or supplement thereto
without the Representative’s consent. The Company shall furnish to each Underwriter, without
charge, as many copies of any free writing prospectus prepared by or on behalf of, or used by
the Company, as such Underwriter may reasonably request. If at any time during the Prospectus
Delivery Period (but in any event if at any time through and including the First Closing Date)
there occurred or occurs an event or development as a result of which any free writing
prospectus prepared by or on behalf of, used by, or referred to by the Company conflicted or
would conflict with the information contained in the Registration Statement 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 shall promptly
amend or supplement such free writing prospectus to eliminate or correct such conflict or so
that the statements in such free writing prospectus as so amended or supplemented will not
include an untrue statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances prevailing at such
subsequent time, not misleading, as the case may be; provided, however, that prior to amending
or supplementing any such free writing prospectus, the Company shall furnish to the
Representative for review, a reasonable amount of time prior to the proposed time of filing or
use thereof, a copy of such proposed amended or supplemented free writing prospectus and the
Company shall not file, use or refer to any such amended or supplemented free writing
prospectus without the Representative’s consent.
(d) Filing of Underwriter Free Writing Prospectuses. The Company shall not take any
action that would result in an Underwriter or the Company being required to file with the
Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared
by or on behalf of the Underwriter that the Underwriter otherwise would not have been required
to file thereunder.
(e) Amendments and Supplements to Time of Sale Prospectus. If the Time of Sale Prospectus
is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet
available to prospective purchasers and any event shall occur or condition exist as a result of
which it is necessary to amend or supplement the Time of Sale Prospectus so that the Time of
Sale Prospectus does not include an untrue statement of a material fact or omit to
17
state a material fact necessary in order to make the statements therein, in the light of the
circumstances when delivered to a prospective purchaser, not misleading, or if any event shall
occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the
information contained in the Registration Statement, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with
applicable law, including the Securities Act, the Company shall (subject to Sections 3(b) and
3(c)) forthwith prepare, file with the Commission and furnish, at its own expense, to the
Underwriters and to any dealer upon request, either amendments or supplements to the Time of
Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or
supplemented will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances when delivered to a prospective purchaser, not misleading or so that the Time of
Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration
Statement, or so that the Time of
Sale Prospectus, as amended or supplemented, will comply with applicable law including the
Securities Act.
(f) Securities Act Compliance. After the date of this Agreement, during the Prospectus
Delivery Period, the Company shall promptly advise the Representative in writing (i) of the
receipt of any comments of, or requests for additional or supplemental information from, the
Commission, (ii) of the time and date of any filing of any post-effective amendment to the
Registration Statement or any amendment or supplement to any preliminary prospectus, the Time
of Sale Prospectus, any free writing prospectus or the Prospectus, (iii) of the time and date
that any post-effective amendment to the Registration Statement becomes effective and (iv) of
the issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto or any amendment or supplement
to the Time of Sale Prospectus or the Prospectus or of any order preventing or suspending the
use of any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus or
the Prospectus, or of any proceedings to remove, suspend or terminate from listing or quotation
the Shares from any securities exchange upon which they are listed for trading or included or
designated for quotation, or of the threatening or initiation of any proceedings for any of
such purposes. If the Commission shall enter any such stop order at any time, the Company will
use its best efforts to obtain the lifting of such order at the earliest possible moment.
Additionally, the Company agrees that it shall comply with the provisions of Rule 424(b), Rule
433 and Rule 430A, as applicable, under the Securities Act and will use its reasonable efforts
to confirm that any filings made by the Company under such Rule 424(b) or Rule 433 were
received in a timely manner by the Commission.
(g) Amendments and Supplements to the Prospectus and Other Securities Act Matters. If,
during the Prospectus Delivery Period, any event shall occur or condition exist as a result of
which it is necessary to amend or supplement the Prospectus so that the Prospectus does not
include an untrue statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if in the opinion of the Representative or counsel
for the Underwriters it is otherwise necessary to amend or supplement the Prospectus to comply
with applicable law, including the Securities Act, the Company agrees (subject to Section 3(b)
and 3(c)) to promptly prepare, file with the Commission and furnish at its own expense to the
Underwriters and to dealers, amendments or supplements to the Prospectus so that the statements
in the Prospectus as so amended or supplemented will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will comply
18
with applicable
law including the Securities Act. Neither the Representative’s consent to, or delivery of, any
such amendment or supplement shall constitute a waiver of any of the Company’s obligations
under Sections 3(b) or (c).
(h) Blue Sky Compliance. The Company shall cooperate with the Representative and counsel
for the Underwriters to qualify or register the Offered Shares for sale under (or obtain
exemptions from the application of) the state securities or blue sky laws or Canadian
provincial securities laws (or other foreign laws) of those jurisdictions designated by
the Representative, shall comply with such laws and shall continue such qualifications,
registrations and exemptions in effect so long as required for the distribution of the Offered
Shares. The Company shall not be required to qualify as a foreign corporation or to take any
action that would subject it to general service of process in any such jurisdiction where it is
not presently qualified or where it would be subject to taxation as a foreign corporation. The
Company will advise the Representative promptly of the suspension of the qualification or
registration of (or any such exemption relating to) the Offered Shares for offering, sale or
trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose,
and in the event of the issuance of any order suspending such qualification, registration or
exemption, the Company shall use its best efforts to obtain the withdrawal thereof at the
earliest possible moment.
(i) Use of Proceeds. The Company shall apply the net proceeds from the sale of the
Offered Shares sold by it in the manner described under the caption “Use of Proceeds” in each
Applicable Prospectus.
(j) Transfer Agent. The Company shall engage and maintain, at its expense, a registrar
and transfer agent for the Shares.
(k) Earnings Statement. As soon as practicable, but in any event no later than twelve
months after the date of this Agreement, the Company will make generally available to its
security holders and to the Representative an earnings statement (which need not be audited)
covering a period of at least twelve months beginning with the first fiscal quarter of the
Company occurring after the date of this Agreement which shall satisfy the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.
(l) Periodic Reporting Obligations. The Company shall file, on a timely basis, with the
Commission and the Nasdaq Global Market all reports and documents required to be filed under
the Exchange Act.
(m) Exchange Act Compliance. During the Prospectus Delivery Period, the Company shall
file all documents required to be filed with the Commission pursuant to Section 13, 14 or 15 of
the Exchange Act in the manner and within the time periods required by the Exchange Act.
(n) Listing. During the Prospectus Delivery Period, the Company will use its best efforts
to effect and maintain the inclusion and quotation of the Offered Shares on the Nasdaq Global
Market.
(o) Company to Provide Copy of the Prospectus in Form That May be Downloaded from the
Internet. The Company shall cause to be prepared and delivered, at its expense, within one
business day from the effective date of this Agreement, to Jefferies an “electronic
19
Prospectus”
to be used by the Underwriters in connection with the offering and sale of the Offered Shares.
As used herein, the term “electronic Prospectus” means a form of Time of Sale Prospectus, and
any amendment or supplement thereto, that meets each of the following conditions: (i) it shall
be encoded in an electronic format, satisfactory to Jefferies, that may be transmitted
electronically by Jefferies and the other Underwriters to offerees and purchasers of the
Offered Shares; (ii) it shall disclose the same information as the paper Time of Sale
Prospectus, except to the extent that graphic and image material cannot be disseminated
electronically, in which case such graphic and image material shall be replaced in the
electronic Prospectus with a fair and accurate narrative description or tabular representation
of such material, as appropriate; and (iii) it shall be in or convertible into a paper format
or an electronic format, satisfactory to Jefferies, that will allow investors to store and have
continuously ready access to the Time of Sale Prospectus at any future time, without charge to
investors (other than any fee charged for subscription to the Internet as a whole and for
on-line time). The Company hereby confirms that it has included or will include in the
Prospectus filed pursuant to XXXXX or otherwise with the Commission and in the Registration
Statement at the time it was declared effective an undertaking that, upon receipt of a request
by an investor or his or her representative, the Company shall transmit or cause to be
transmitted promptly, without charge, a paper copy of the Time of Sale Prospectus.
(p) Agreement Not to Offer or Sell Additional Shares. During the period commencing on and
including the date hereof and ending on and including the 90th day following the
date of this Agreement (as the same may be extended as described below, the “Lock-up Period”),
the Company will not, without the prior written consent of Jefferies (which consent may be
withheld at the sole discretion of Jefferies), directly or indirectly, sell (including, without
limitation, any short sale), offer, contract or grant any option to sell, pledge, transfer or
establish an open “put equivalent position” within the meaning of Rule 16a-1(h) under the
Exchange Act, or otherwise dispose of or transfer, or announce the offering of, or file any
registration statement under the Securities Act, except for a registration statement on Form
S-8 relating to the Company’s employee benefit plans, in respect of, any Shares, options,
rights or warrants to acquire Shares or securities exchangeable or exercisable for or
convertible into Shares (other than as contemplated by this Agreement with respect to the
Offered Shares) or publicly announce the intention to do any of the foregoing, other than (i)
the issuance of restricted Common Stock, restricted stock units or options to acquire Common
Stock pursuant to the Company’s employee benefit plans, qualified stock option plans or other
equity incentive plans as such plans are in existence on the date hereof and described in the
Applicable Prospectus, (ii) issuances of Common Stock upon the exercise or settlement of
options or restricted stock units or warrants disclosed as outstanding in any Applicable
Prospectus. Notwithstanding the foregoing, if (A) during the last 17 days of the Lock-up
Period, the Company issues an earnings release or material news or a material event relating to
the Company occurs or (B) 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 the issuance of the earnings release or the
occurrence of the material news or material event, as applicable, unless Jefferies
waives, in writing, such extension (which waiver may be withheld at the sole discretion of
Jefferies), except that such extension will not apply if, (i) within three business days prior
to the 15th calendar day before the last day of the Lock-up Period, the Company delivers a
certificate, signed by the Chief Financial Officer or Chief Executive Officer of the Company,
certifying on behalf of the Company that (i) the Shares are “actively traded securities” (as
defined in Regulation M), (ii) the Company meets the applicable requirements of paragraph
(a)(1) of Rule 139 under the Securities Act in the manner contemplated by NASD
20
Conduct Rule
2711(f)(4), and (iii) the provisions of NASD Conduct Rule 2711(f)(4) are not applicable to any
research reports relating to the Company published or distributed by any of the Underwriters
during the 15 days before or after the last day of the Lock-up Period (before giving effect to
such extension). The Company will provide the Representative with prior notice of any such
announcement that gives rise to an extension of the Lock-up Period.
(q) Future Reports to the Representative. During the period of five years hereafter the
Company will furnish to Jefferies at 520 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx Xttention: Capital
Markets: (i) as soon as practicable after the end of each fiscal year, copies of the Annual
Report of the Company containing the balance sheet of the Company as of the close of such
fiscal year and statements of income, stockholders’ equity and cash flows for the year then
ended and the opinion thereon of the Company’s independent public or certified public
accountants; (ii) as soon as practicable after the filing thereof, copies of each proxy
statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form
8-K or other report filed by the Company with the Commission, FINRA or any securities exchange;
and (iii) as soon as available, copies of any report or communication of the Company mailed
generally to holders of its capital stock; provided that the requirements of this subsection
(q) shall be satisfied to the extent the reports, communications, financial statements or other
documents referenced herein are available on XXXXX.
(r) Investment Limitation. The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Offered Shares in such a manner as would require
the Company or any of its subsidiaries to register as an investment company under the
Investment Company Act.
(s) No Stabilization or Manipulation; Compliance with Regulation M. The Company will not
take, directly or indirectly, any action designed to or that might be reasonably expected to
cause or result in stabilization or manipulation of the price of the Shares or any other
reference security, whether to facilitate the sale or resale of the Offered Shares or
otherwise, and the Company will, and shall cause each of its affiliates to, comply with all
applicable provisions of Regulation M. If the limitations of Rule 102 of Regulation M (“Rule
102”) do not apply with respect to the Offered Shares or any other reference security pursuant
to any exception set forth in Section (d) of Rule 102, then promptly upon notice from the
Representative (or, if later, at the time stated in the notice), the Company will, and shall
cause each of its affiliates to, comply with Rule 102 as though such exception were not
available but the other provisions of Rule 102 (as interpreted by the Commission) did apply.
(t) Existing Lock-Up Agreements. During the Lock-Up Period, the Company will use commercially reasonable efforts to
enforce all existing agreements between the Company and any of its security holders that
prohibit the sale, transfer, assignment, pledge or hypothecation of any of the Company’s
securities. In addition, the Company will direct the transfer agent to place stop transfer
restrictions upon any such securities of the Company that are bound by such existing “lock-up”
agreements for the duration of the periods contemplated in such agreements, including, without
limitation, “lock-up” agreements entered into by the Company’s officers and directors pursuant
to Section 6(h).
Jefferies, on behalf of the several Underwriters, may, in its sole discretion, waive in
writing the performance by the Company of any one or more of the foregoing covenants or extend
the time for their performance.
21
Section 4. Payment of Expenses. The Company agrees to pay all costs, fees and expenses
incurred in connection with the performance of its obligations hereunder and in connection with
the transactions contemplated hereby, including without limitation (i) all expenses incident to
the issuance and delivery of the Offered Shares (including all printing and engraving costs),
(ii) all fees and expenses of the registrar and transfer agent of the Shares, (iii) all
necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the
Offered Shares to the Underwriters, (iv) all fees and expenses of the Company’s counsel,
independent public or certified public accountants and other advisors, (v) all costs and
expenses incurred in connection with the preparation, printing, filing, shipping and
distribution of the Registration Statement (including financial statements, exhibits,
schedules, consents and certificates of experts), the Time of Sale Prospectus, the Prospectus,
any free writing prospectus prepared by or on behalf of, used by, or referred to by the
Company, and each preliminary prospectus, and all amendments and supplements thereto, and this
Agreement, (vi) all filing fees, attorneys’ fees and expenses incurred by the Company or the
Underwriters in connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Offered Shares for offer and sale
under the state securities or blue sky laws or the provincial securities laws of Canada, and,
if requested by the Representative, preparing and printing a “Blue Sky Survey” or memorandum
and a “Canadian wrapper”, and any supplements thereto, advising the Underwriters of such
qualifications, registrations, determinations and exemptions, (vii) the filing fees incident
to, and the reasonable fees and expenses of counsel for the Underwriters in connection with,
FINRA’s review, if any, and approval of the Underwriters’ participation in the offering and
distribution of the Offered Shares, (viii) the costs and expenses of the Company relating to
investor presentations on any “road show” undertaken in connection with the marketing of the
offering of the Shares, including, without limitation, expenses associated with the preparation
or dissemination of any electronic road show, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants engaged in connection with the
road show presentations with the prior approval of the Company, travel and lodging expenses of
the Representative, employees and officers of the Company and of the Representative and any
such consultants, and the cost of any aircraft chartered in connection with the road show, (ix)
the fees and expenses associated with including the Offered Shares on the Nasdaq Global Market,
and (ix) all other fees, costs and expenses of the nature referred to in Item 14 of Part II of
the Registration Statement. Except as provided in this Section 4, Section 7, Section 9 and
Section 10 hereof, the Underwriters shall pay their own expenses, including the fees and
disbursements of their counsel.
Section 5. Covenant of the Underwriters. Each Underwriter severally and not jointly,
covenants with the Company not to take any action that would result in the Company being
required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free
writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be
required to be filed by the Company thereunder, but for the action of the Underwriter.
Section 6. Conditions of the Obligations of the Underwriters. The obligations of the
several Underwriters to purchase and pay for the Offered Shares as provided herein on the First
Closing Date and, with respect to the Optional Shares, each Option Closing Date, shall be
subject to the accuracy of the representations and warranties on the part of the Company set
forth in Section 1 hereof as of the date hereof and as of the First Closing Date as though then
made and, with respect to the Optional Shares, as of each Option Closing Date as though then
made, to the timely performance by the Company of its covenants and other obligations
hereunder, and to each of the following additional conditions:
22
(a) Accountants’ Comfort Letter. On the date hereof, the Representative shall have
received from KMJ Xxxxxx & Company LLP, independent public or certified public accountants for
the Company, (i) a letter dated the date hereof addressed to the Underwriters, in form and
substance satisfactory to the Representative, containing statements and information of the type
ordinarily included in accountant’s “comfort letters” to underwriters, delivered according to
Statement of Auditing Standards No. 72 (or any successor bulletin), with respect to the audited
and unaudited financial statements and certain financial information contained in the
Registration Statement, the Time of Sale Prospectus, and each free writing prospectus, if any,
and, with respect to each letter dated the date hereof only, the Prospectus, and (ii)
confirming that they are (A) independent public or certified public accountants as required by
the Securities Act and the Exchange Act and (B) in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X.
(b) Compliance with Registration Requirements; No Stop Order; No Objection from FINRA.
For the period from and after effectiveness of this Agreement and prior to the First Closing
Date and, with respect to the Optional Shares, each Option Closing Date:
(i) the Company shall have filed the Prospectus with the Commission (including the
information previously omitted from the Registration Statement pursuant to Rule 430B under
the Securities Act) in the manner and within the time period required by Rule 424(b) under
the Securities Act;
(ii) no stop order suspending the effectiveness of the Registration Statement, or any
post-effective amendment to the Registration Statement, shall be in effect and no
proceedings for such purpose shall have been instituted or threatened by the Commission;
and
(iii) FINRA shall have raised no objection to the fairness and reasonableness of the
underwriting terms and arrangements.
(c) No Material Adverse Change or Ratings Agency Change. For the period from and after
the date of this Agreement and through and including the First Closing Date and, with respect
to the Optional Shares, each Option Closing Date:
(i) in the reasonable judgment of the Representative there shall not have occurred any
Material Adverse Change; and
(ii) there shall not have occurred any downgrading, nor shall any notice have been
given of any intended or potential downgrading or of any review for a possible change that
does not indicate the direction of a possible change, in the rating accorded any securities
of the Company or any of its subsidiaries by any “nationally recognized statistical rating
organization” as such term is defined for purposes of Rule 436(g)(2) under the Securities
Act.
(d) Opinion of Counsel for the Company. On each of the First Closing Date and each Option
Closing Date the Representative shall have received the opinion of Xxxxxxx Procter LLP, counsel
for the Company, dated as of such Closing Date, the form of which is attached as Exhibit
A.
23
(e) Opinion of Intellectual Property Counsel for the Company. On each of the First
Closing Date and each Option Closing Date the Representative shall have received the opinion of
Xxxxxxxx and Xxxxxxxx and Crew LLP, intellectual property counsel for the Company, dated as of
such Closing Date, the form of which is attached as Exhibit B.
(f) Opinion of Counsel for the Underwriters. On each of the First Closing Date and each
Option Closing Date the Representative shall have received the opinion of Xxxxxx & Xxxxxxx LLP,
counsel for the Underwriters, in form and substance satisfactory to the Underwriters, dated as
of such Closing Date.
(g) Officers’ Certificate. On each of the First Closing Date and each Option Closing Date
the Representative shall have received a written certificate executed by the Chief Executive
Officer or President of the Company and the Chief Financial Officer of the Company, dated as of
such Closing Date, to the effect set forth in subsection (b)(ii) of this Section 6, and further
to the effect that:
(i) for the period from and including the date of this Agreement through and including
such Closing Date, there has not occurred any Material Adverse Change;
(ii) the representations, warranties and covenants of the Company set forth in Section
1 of this Agreement are true and correct with the same force and effect as though expressly
made on and as of such Closing Date; and
(iii) the Company has complied with all the agreements hereunder and satisfied all the
conditions on its part to be performed or satisfied hereunder at or prior to such Closing
Date.
(h) Bring-down Comfort Letter. On each of the First Closing Date and each Option Closing
Date the Representative shall have received from KMJ Xxxxxx & Company LLP, independent public
or certified public accountants for the Company, a letter dated such date, in form and
substance satisfactory to the Representative, to the effect that they reaffirm the statements
made in the letter furnished by them pursuant to subsection (a) of this Section 6, except that
the specified date referred to therein for the carrying out of procedures shall be no more than
three business days prior to the First Closing Date or the applicable Option Closing Date, as
the case may be.
(i) Lock-Up Agreement from Certain Securityholders of the Company. On or prior to the
date hereof, the Company shall have furnished to the Representative an agreement in the form of
Exhibit D hereto from the persons listed on Exhibit C hereto, and such
agreement shall be in full force and effect on each of the First Closing Date and each Option
Closing Date.
(j) Additional Documents. On or before each of the First Closing Date and each Option
Closing Date, the Representative and counsel for the Underwriters shall have received such
information, documents and opinions as they may reasonably request for the purposes of enabling
them to pass upon the issuance and sale of the Offered Shares as contemplated herein, or in
order to evidence the accuracy of any of the representations and warranties, or the
satisfaction of any of the conditions or agreements, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Offered Shares as
contemplated herein and in connection with the other transactions contemplated by this
Agreement shall be satisfactory in form and substance to the Representative and counsel for the
Underwriters.
24
If any condition specified in this Section 6 is not satisfied when and as required to be
satisfied, this Agreement may be terminated by the Representative by notice to the Company at
any time on or prior to the First Closing Date and, with respect to the Optional Shares, at any
time on or prior to the applicable Option Closing Date, which termination shall be without
liability on the part of any party to any other party, except that Section 4, Section 6,
Section 9 and Section 10 shall at all times be effective and shall survive such termination.
Section 7. Reimbursement of Underwriters’ Expenses. If this Agreement is terminated by
the Representative pursuant to Section 6, Section 11 or Section 12, or if the sale to the
Underwriters of the Offered Shares on the First Closing Date is not consummated because of any
refusal, inability or failure on
the part of the Company to perform any agreement herein or to comply with any provision
hereof, the Company agrees to reimburse the Representative and the other Underwriters (or such
Underwriters as have terminated this Agreement with respect to themselves), severally, upon
demand for all documented out-of-pocket expenses that shall have been reasonably incurred by
the Representative and the Underwriters in connection with the proposed purchase and the
offering and sale of the Offered Shares, including but not limited to fees and disbursements of
counsel, printing expenses, travel expenses, postage, facsimile and telephone charges.
Section 8. Effectiveness of this Agreement. This Agreement shall not become effective
until the execution of this Agreement by the each of the parties hereto.
Section 9. Indemnification.
(a) Indemnification of the Underwriters. The Company agrees to indemnify and hold
harmless each Underwriter, its officers and employees, and each person, if any, who controls
any Underwriter within the meaning of the Securities Act or the Exchange Act against any loss,
claim, damage, liability or expense, as incurred, to which such Underwriter or such officer,
employee or controlling person may become subject, under the Securities Act, the Exchange Act,
other federal or state statutory law or regulation, or the laws or regulations of foreign
jurisdictions where Offered Shares have been offered or sold or at common law or otherwise
(including in settlement of any litigation), insofar as such loss, claim, damage, liability or
expense (or actions in respect thereof as contemplated below) arises out of or is based upon
(i) any untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, or any amendment thereto, including any information deemed to be a part
thereof pursuant to Rule 430A under the Securities Act, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make the statements
therein not misleading; or (ii) any untrue statement or alleged untrue statement of a material
fact contained in any preliminary prospectus, the Time of Sale Prospectus, any free writing
prospectus that the Company has used, referred to or filed, or is required to file, pursuant to
Rule 433(d) of the Securities Act or the Prospectus (or any amendment or supplement thereto),
or the omission or alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not
misleading; or (iii) any act or failure to act or any alleged act or failure to act by any
Underwriter in connection with, or relating in any manner to, the Shares or the offering
contemplated hereby, and which is included as part of or referred to in any loss, claim,
damage, liability or action arising out of or based upon any matter covered by clause (i) or
(ii) above, provided that the Company shall not be liable under this clause (iii) to the extent
that a court of competent jurisdiction shall have determined by a final judgment that such
loss, claim, damage, liability or action resulted directly from any such acts or
25
failures to act undertaken or omitted to be taken by such Underwriter through its bad faith or willful
misconduct or (B) the violation of any laws or regulations of foreign jurisdictions where
Offered Shares have been offered or sold; and to reimburse each Underwriter and each such
officer, employee and controlling person for any and all expenses (including the fees and
disbursements of counsel chosen by Jefferies) as such expenses are reasonably incurred by such
Underwriter or such officer, employee or controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage, liability, expense or
action; provided, however, that the foregoing indemnity agreement shall not apply to any loss,
claim, damage, liability or expense to the extent, but only to the extent,
arising out of or based upon any untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with written information furnished
to the Company by the Representative expressly for use in the Registration Statement, any
preliminary prospectus, the Time of Sale Prospectus, any such free writing prospectus or the
Prospectus (or any amendment or supplement thereto), it being understood and agreed that the
only such information furnished by the Representative to the Company consists of the
information described in subsection (b) below. The indemnity agreement set forth in this
Section 9(a) shall be in addition to any liabilities that the Company may otherwise have.
(b) Indemnification of the Company, its Directors and Officers. Each Underwriter agrees,
severally and not jointly, to indemnify and hold harmless the Company, each of its directors,
each of its officers who signed the Registration Statement and each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange Act, against any
loss, claim, damage, liability or expense, as incurred, to which the Company, or any such
director, officer or controlling person may become subject, under the Securities Act, the
Exchange Act, or other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is effected with the
written consent of such Underwriter), insofar as such loss, claim, damage, liability or expense
(or actions in respect thereof as contemplated below) arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in the Registration
Statement, any preliminary prospectus the Time of Sale Prospectus, any free writing prospectus
that the Company has used, referred to or filed, or is required to file, pursuant to Rule
433(d) of the Securities Act or the Prospectus (or such amendment or supplement thereto), or
arises out of or is 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, such
preliminary prospectus, the Time of Sale Prospectus, such free writing prospectus that the
Company has used, referred to or filed, or is required to file, pursuant to Rule 433(d) of the
Securities Act, the Prospectus (or such amendment or supplement thereto), in reliance upon and
in conformity with written information furnished to the Company by the Representative expressly
for use therein; and to reimburse the Company, or any such director, officer or controlling
person for any legal and other expense reasonably incurred by the Company, or any such
director, officer or controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or action. The Company
hereby acknowledges that the only information that the Representative and the Underwriters have
furnished to the Company expressly for use in the Registration Statement, any preliminary
prospectus, the Time of Sale Prospectus, any free writing prospectus that the Company has
filed, or is required to file, pursuant to Rule 433(d) of the Securities Act or the Prospectus
(or any amendment or supplement thereto) are the statements set forth in the first paragraph
under the section entitled “Commissions and Expenses” and the second, third, fourth and fifth
paragraphs under the section entitled “Price
26
Stabilization, Short Positions and Penalty Bids”,
each under the caption “Underwriting” in the Company’s prospectus supplement dated May 6, 2010
relating to the offering of the Offered Shares. The indemnity agreement set forth in this
Section 9(b) shall be in addition to any liabilities that each Underwriter may otherwise have.
(c) Notifications and Other Indemnification Procedures. Promptly after receipt by an indemnified party under this Section 9 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party under this Section 9, notify the indemnifying party in
writing of the commencement thereof, but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party for contribution
or otherwise than under the indemnity agreement contained in this Section 9 or to the extent it
is not prejudiced as a proximate result of such failure. In case any such action is brought
against any indemnified party and such indemnified party seeks or intends to seek indemnity
from an indemnifying party, the indemnifying party will be entitled to participate in, and, to
the extent that it shall elect, jointly with all other indemnifying parties similarly notified,
by written notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that a conflict may arise between the positions of the indemnifying
party and the indemnified party in conducting the defense of any such action or that there may
be legal defenses available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party or parties shall
have the right to select separate counsel to assume such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or parties. Upon
receipt of notice from the indemnifying party to such indemnified party of such indemnifying
party’s election so to assume the defense of such action and approval by the indemnified party
of counsel, the indemnifying party will not be liable to such indemnified party under this
Section 9 for any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the fees and expenses of more than
one separate counsel (together with local counsel), representing the indemnified parties who
are parties to such action), which counsel (together with any local counsel) for the
indemnified parties shall be selected by Jefferies (in the case of counsel for the indemnified
parties referred to in Section 9(a) above) or by the Company (in the case of counsel for the
indemnified parties referred to in Section 9(b) above)) (ii) the indemnifying party shall not
have employed counsel satisfactory to the indemnified party to represent the indemnified party
within a reasonable time after notice of commencement of the action or (iii) the indemnifying
party has authorized in writing the employment of counsel for the indemnified party at the
expense of the indemnifying party, in each of which cases the fees and expenses of counsel
shall be at the expense of the indemnifying party and shall be paid as they are incurred.
(d) Settlements. The indemnifying party under this Section 9 shall not be liable for any
settlement of any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party against any loss, claim, damage, liability or expense by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by Section 9(c) hereof,
27
the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement, compromise or consent to the entry of
judgment in any pending or threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or consent includes an
unconditional release of such indemnified party from all liability on claims that are the
subject matter of such action, suit or proceeding.
Section 10. Contribution. If the indemnification provided for in Section 9 is for any
reason held to be unavailable to or otherwise insufficient to hold harmless an indemnified
party in respect of any losses, claims, damages, liabilities or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount paid or payable by such
indemnified party, as incurred, as a result of any losses, claims, damages, liabilities or
expenses referred to therein (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 hand,
from the offering of the Offered Shares pursuant to this Agreement 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 hand, in
connection with the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company, on the one hand, and the Underwriters, on the other hand, in
connection with the offering of the Offered Shares pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total net proceeds from the offering of the
Offered Shares pursuant to this Agreement (before deducting expenses) received by the Company,
and the total underwriting discounts and commissions received by the Underwriters, in each case
as set forth on the front cover page of the Prospectus bear to the aggregate initial public
offering price of the Offered Shares as set forth on such cover. The relative fault of the
Company, on the one hand, and the Underwriters, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates to information
supplied by the Company, on the one hand, or the Underwriters, on the other hand, and the
parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed to include, subject to the
limitations set forth in Section 9(c), any legal or other fees or expenses reasonably incurred
by such party in connection with investigating or defending any action or claim. The
provisions set forth in Section 9(c) with respect to notice of commencement of any action shall
apply if a claim for contribution is to be made under this Section 10; provided, however, that
no additional notice shall be required with respect to any action for which notice has been
given under Section 9(c) for purposes of indemnification.
The Company and the Underwriters agree that it would not be just and equitable if
contribution pursuant to this Section 10 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
28
of allocation which does not take account of the equitable considerations referred to in
this Section 10.
Notwithstanding the provisions of this Section 10, no Underwriter shall be required to
contribute any amount in excess of the underwriting discounts and commissions received by such
Underwriter in connection with the Offered Shares underwritten by it and distributed to the
public. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to
this Section 10 are several, and not joint, in proportion to their respective underwriting
commitments as set forth opposite their respective names on Schedule A. For purposes
of this Section 10, each officer and employee of an Underwriter and each person, if any, who
controls an Underwriter within the meaning of the Securities Act or the Exchange Act shall have
the same rights to contribution as such Underwriter, and each director of the Company, each
officer of the Company who signed the Registration Statement, and each person, if any, who
controls the Company with the meaning of the Securities Act and the Exchange Act shall have the
same rights to contribution as the Company.
Section 11. Default of One or More of the Several Underwriters. If, on the First Closing
Date or the applicable Option Closing Date, as the case may be, any one or more of the several
Underwriters shall fail or refuse to purchase Offered Shares that it or they have agreed to
purchase hereunder on such date, and the aggregate number of Offered Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase does not exceed
10% of the aggregate number of the Offered Shares to be purchased on such date, the
Representative may make arrangements satisfactory to the Company for the purchase of such
Offered Shares by other persons, including any of the Underwriters, but if no such arrangements
are made by such Closing Date, the other Underwriters shall be obligated, severally and not
jointly, in the proportions that the number of Firm Shares set forth opposite their respective
names on Schedule A bears to the aggregate number of Firm Shares set forth opposite the
names of all such non-defaulting Underwriters, or in such other proportions as may be specified
by the Representative with the consent of the non-defaulting Underwriters, to purchase the
Offered Shares which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase on such date. If, on the First Closing Date or the applicable Option Closing Date,
as the case may be, any one or more of the Underwriters shall fail or refuse to purchase
Offered Shares and the aggregate number of Offered Shares with respect to which such default
occurs exceeds 10% of the aggregate number of Offered Shares to be purchased on such date, and
arrangements satisfactory to Jefferies and the Company for the purchase of such Offered Shares
are not made within 48 hours after such default, this Agreement shall terminate with respect to
the non-defaulting Underwriters without liability to any other party, except that the
provisions of Section 4, Section 7, Section 9 and Section 10 shall at all times be effective
and shall survive such termination. In any such case either the Representative or the Company
shall have the right to postpone the First Closing Date or the applicable Option Closing Date,
as the case may be, but in no event for longer than seven days in order that the required
changes, if any, to the Registration Statement and the Prospectus or any other documents or
arrangements may be effected.
As used in this Agreement, the term “Underwriter” shall be deemed to include any person
substituted for a defaulting Underwriter under this Section 11 Any action
29
taken under this Section 11 hall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
Section 12. Termination of this Agreement. Prior to the purchase of the Firm Shares by
the Underwriters on the First Closing Date this Agreement may be terminated by the
Representative by notice given to the Company if at any time (i) trading or quotation in any of
the Company’s securities shall have been suspended or limited by the Commission or by the
Nasdaq Global Market, or trading in securities generally on either the Nasdaq Stock Market or
the New York Stock Exchange shall have been suspended or limited, or minimum or maximum prices
shall have been generally established on any of such stock exchanges by the Commission or
FINRA; (ii) a general banking moratorium shall have been declared by any of federal, New York
or California authorities; (iii) there shall have occurred any outbreak or escalation of
national or international hostilities or any crisis or calamity, or any change in the United
States or international financial markets, or any substantial change or development involving a
prospective substantial change in United States’ or international political, financial or
economic conditions, as in the judgment of the Representative is material and adverse and makes
it impracticable to market the Offered Shares in the manner and on the terms described in the
Time of Sale Prospectus or the Prospectus or to enforce contracts for the sale of securities;
(iv) in the reasonable judgment of the Representative there shall have occurred any Material
Adverse Change; or (v) the Company shall have sustained a loss by strike, fire, flood,
earthquake, accident or other calamity of such character as in the judgment of the
Representative may interfere materially with the conduct of the business and operations of the
Company regardless of whether or not such loss shall have been insured. Any termination
pursuant to this Section 12 shall be without liability on the part of (a) the Company to any
Underwriter, except that the Company shall be obligated to reimburse the expenses of the
Representative and the Underwriters pursuant to Sections 4 and 7 hereof, (b) any Underwriter
to the Company, or (c) of any party hereto to any other party except that the provisions of
Section 9 and Section 10 shall at all times be effective and shall survive such termination.
Section 13. No Advisory or Fiduciary Relationship. The Company acknowledges and agrees
that (a) the purchase and sale of the Offered Shares pursuant to this Agreement, including the
determination of the public offering price of the Offered Shares and any related discounts and
commissions, is an arm’s-length commercial transaction between the Company, on the one hand,
and the several Underwriters, on the other hand, (b) in connection with the offering
contemplated hereby and the process leading to such transaction each Underwriter is and has
been acting solely as a principal and is not the agent or fiduciary of the Company, or its
stockholders, creditors, employees or any other party, (c) no Underwriter has assumed or will
assume an advisory or fiduciary responsibility in favor of the Company with respect to the
offering contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company on other matters) and no
Underwriter has any obligation to the Company with respect to the offering contemplated hereby
except the obligations expressly set forth in this Agreement, (d) the Underwriters and their
respective affiliates may be engaged in a broad range of transactions that involve interests
that differ from those of the Company, and (e) the Underwriters have not provided any legal,
accounting, regulatory or tax advice with respect to the offering contemplated hereby and the
Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it
deemed appropriate.
Section 14. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of the Company, of
30
its officers and of the several Underwriters set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by or on behalf of
any Underwriter or the Company or any of its or their partners, officers or directors or any
controlling person, as the case may be, and, anything herein to the contrary notwithstanding,
will survive delivery of and payment for the Offered Shares sold hereunder and any termination
of this Agreement.
Section 15. Notices. All communications hereunder shall be in writing and shall be
mailed, hand delivered or telecopied and confirmed to the parties hereto as follows:
If to the Representative:
Jefferies & Company, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
with a copy to:
Jefferies & Company, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
If to the Company:
Avanir Pharmaceuticals, Inc.
000 Xxxxxxxxxx, Xxxxx 000
Xxxxx Xxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
000 Xxxxxxxxxx, Xxxxx 000
Xxxxx Xxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
Any party hereto may change the address for receipt of communications by giving written notice
to the others.
Section 16. Successors. This Agreement will inure to the benefit of and be binding upon
the parties hereto, including any substitute Underwriters pursuant to Section 11 hereof, and to
the benefit of the employees, officers and directors and controlling persons referred to in
Section 9 and Section 10, and in each case their respective successors, and no other person
will have any right or obligation hereunder. The term “successors” shall not include any purchaser of
the Offered Shares as such from any of the Underwriters merely by reason of such purchase.
Section 17. Partial Unenforceability. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or enforceability of any
other Section, paragraph or provision hereof. If any Section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to
be made such minor changes (and only such minor changes) as are necessary to make it valid and
enforceable.
31
Section 18. Governing Law Provisions. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York applicable to agreements made and
to be performed in such state. Any legal suit, action or proceeding arising out of or based
upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be
instituted in the federal courts of the United States of America located in the Borough of
Manhattan in the City of New York or the courts of the State of New York in each case located
in the Borough of Manhattan in the City of New York (collectively, the “Specified Courts”), and
each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted
in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to
which such jurisdiction is non-exclusive) of such courts in any such suit, action or
proceeding. Service of any process, summons, notice or document by mail to such party’s
address set forth above shall be effective service of process for any suit, action or other
proceeding brought in any such court. The parties irrevocably and unconditionally waive any
objection to the laying of venue of any suit, action or other proceeding in the Specified
Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such
court that any such suit, action or other proceeding brought in any such court has been brought
in an inconvenient forum.
With respect to any Related Proceeding, each party irrevocably waives, to the fullest
extent permitted by applicable law, all immunity (whether on the basis of sovereignty or
otherwise) from jurisdiction, service of process, attachment (both before and after judgment)
and execution to which it might otherwise be entitled in the Specified Courts, and with respect
to any Related Judgment, each party waives any such immunity in the Specified Courts or any
other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any
such immunity at or in respect of any such Related Proceeding or Related Judgment, including,
without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act
of 1976, as amended.
Section 19. General Provisions. This Agreement constitutes the entire agreement of the
parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations with respect to the subject matter hereof. This
Agreement may be executed in two or more counterparts, each one of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement may not be amended or modified unless in writing by all of the parties hereto,
and no condition herein (express or implied) may be waived unless waived in writing by each
party whom the condition is meant to benefit. The Table of Contents and the Section
headings herein are for the convenience of the parties only and shall not affect the
construction or interpretation of this Agreement.
Each of the parties hereto acknowledges that it is a sophisticated business person who was
adequately represented by counsel during negotiations regarding the provisions hereof,
including, without limitation, the indemnification provisions of Section 9 and the contribution
provisions of Section 10, and is fully informed regarding said provisions. Each of the parties
hereto further acknowledges that the provisions of Sections 9 and 10 hereto fairly allocate the
risks in light of the ability of the parties to investigate the Company, its affairs and its
business in order to assure that adequate disclosure has been made in the Registration
Statement, any preliminary prospectus, the Time of Sale Prospectus, each free writing
prospectus and the Prospectus (and any amendments and supplements thereto), as required by the
Securities Act and the Exchange Act.
32
If the foregoing is in accordance with your understanding of our agreement, kindly sign
and return to the Company the enclosed copies hereof, whereupon this instrument, along with all
counterparts hereof, shall become a binding agreement in accordance with its terms.
| Very truly yours, Avanir Pharmaceuticals, Inc. |
||||
| By: | /s/ Xxxxx X. Xxxxxx | |||
| Xxxxx X. Xxxxxx | ||||
| President and Chief Executive Officer | ||||
The foregoing Underwriting Agreement is hereby confirmed and accepted by the
Representative in New York, New York as of the date first above written.
| JEFFERIES & COMPANY, INC. Acting as Representative of the several Underwriters named in the attached Schedule A. |
||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxx | |||
| Title: | Managing Director | |||
33
SCHEDULE A
| Number of | ||
| Firm Shares | ||
| Underwriters | to be Purchased | |
Jefferies & Company, Inc. |
7,250,000 | |
Canaccord Xxxxx Inc. |
2,750,000 | |
Total |
10,000,000 |
SCHEDULE B
None
SCHEDULE C
Number of
Shares being offered: 10,000,000
Underwriters
Over-Allotment Amount: 1,500,000
Price per
Share to the public: $2.75
Estimated
net proceeds to be received by the Company: $26.6 million
