7,400,000 Shares MannKind Corporation Common Stock UNDERWRITING AGREEMENT
EXHIBIT 1.1
7,400,000 Shares
MannKind Corporation
Common Stock
August 5, 2009
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
as Representative of the several
Underwriters named in Schedule I hereto
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
as Representative of the several
Underwriters named in Schedule I hereto
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
MannKind Corporation, a Delaware corporation (the “Company”), proposes, subject to the terms
and conditions contained herein, to sell to you and the other underwriters named on Schedule
I to this Agreement (the “Underwriters”), for whom you are acting as Representative (the
“Representative”), an aggregate of 7,400,000 shares (the “Firm Shares”) of the Company’s common
stock, $0.01 par value per share (the “Common Stock”). The Shares include 1,000,000 shares of
Common Stock (the “Affiliate Shares”) to be purchased by the person named in Schedule II
hereto (the “Affiliate Purchaser”). The respective amounts of the Firm Shares to be purchased by
each of the several Underwriters are set forth opposite their names on Schedule I hereto. In
addition, the Company proposes to grant to the Underwriters an option to purchase up to an
additional 960,000 shares (the “Option Shares”) of Common Stock from the Company for the purpose of
covering over allotments in connection with the sale of the Firm Shares. The Firm Shares and the
Option Shares are collectively called the “Shares.”
The Company has prepared and filed in conformity with the requirements of the Securities Act
of 1933, as amended (the “Securities Act”), and the published rules and regulations thereunder (the
“Rules”) adopted by the Securities and Exchange Commission (the “Commission”) a registration
statement on Form S-3 (No. 333-145282), including a related prospectus dated August 15, 2007 (the
“Base Prospectus”) relating to Common Stock that may be sold from time to time by the Company in
accordance with Rule 415 of the Securities Act, and such amendments thereof as may have been
required to the date of this Agreement. Copies of such Registration Statement (including all
amendments thereof and all documents deemed incorporated by reference therein) and of the related
Base Prospectus have heretofore been delivered by the Company or are otherwise available to you.
The term “Registration Statement” as used in this Agreement means the registration statement
on Form S-3 (No. 333-145282), including all exhibits, financial schedules and all documents and
information deemed to be part of such registration statement through incorporation by reference or
otherwise, as amended at the time it became effective and as supplemented or amended thereafter,
including the information (if any) contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules and deemed to be part thereof at the time of
effectiveness pursuant to Rule 430B of the Rules.
If the Company has filed an abbreviated registration statement to register additional Shares
pursuant to Rule 462(b) under the Rules (the “462(b) Registration Statement”), then any reference
herein to the Registration Statement shall also be deemed to include such 462(b) Registration
Statement. The term “Prospectus” means the Base Prospectus and the final prospectus supplement,
filed pursuant to and within the time limits described in Rule 424(b) with the Commission in
connection with the proposed sale of the Shares contemplated by this Agreement through the date of
such prospectus supplement. The term “Effective Date” shall mean each date that the Registration
Statement and any post-effective amendment or amendments thereto became or become effective. Unless
otherwise stated herein, any reference herein to the Registration Statement, the Statutory
Prospectus (as hereinafter defined) and the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein, including pursuant to Item 12 of Form S-3 under the
Securities Act, which were filed under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) on or before the date hereof or are so filed hereafter. Any reference herein to the
terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the
Statutory Prospectus or the Prospectus shall be deemed to refer to and include any such document
filed or to be filed under the Exchange Act after the date of the Registration Statement, the
Statutory Prospectus or Prospectus, as the case may be, and deemed to be incorporated therein by
reference.
The Company understands that the Underwriters propose to make a public offering of the Shares,
as set forth in and pursuant to the Statutory Prospectus (as hereinafter defined) and the
Prospectus, as soon after the Effective Date and the date of this Agreement as the Representative
deems advisable. The Company hereby confirms that the Underwriters and dealers have been
authorized to distribute or cause to be distributed each Issuer Free Writing Prospectus (as
hereinafter defined) in connection with the offering of the Shares and are authorized to distribute
the Prospectus (as from time to time amended or supplemented if the Company furnishes amendments or
supplements thereto to the Underwriters) in connection with the sale of the Shares.
1. Sale, Purchase, Delivery and Payment for the Shares. On the basis of the
representations, warranties and agreements contained in, and subject to the terms and conditions
of, this Agreement:
(a) The Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at a purchase price
of $7.07 per share (the “Initial Price”), the number of Firm Shares set forth opposite the name of
such Underwriter under the column “Number of Firm Shares to be Purchased” on Schedule I to
this Agreement, subject to adjustment in accordance with Section 9 hereof (other
than the Affiliate Shares, which shall be purchased at a price of $8.11 per Affiliate Share). It
is
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understood and agreed that the Affiliate Shares will initially be reserved for offer and sale to
the Affiliate Purchasers upon the terms and subject to the conditions set forth in this Agreement
and the Prospectus and will be sold to the Affiliate Purchaser by ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLC at a price
of $8.11 per Affiliate Share, which is the closing bid price of the Company’s common stock
immediately preceding the effectiveness of this Agreement.
(b) The Company hereby grants to the several Underwriters an option to purchase, severally and
not jointly, all or any part of the Option Shares at the Initial Price. The Option Shares shall be
purchased by ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLC. Such option may be exercised only to cover over-allotments in
the sales of the Firm Shares by the Underwriters and may be exercised in whole or in part at any
time on or before 12:00 noon, New York City time, on the business day before the Firm Shares
Closing Date (as defined below), and from time to time thereafter within 30 days after the date of
this Agreement, in each case upon written, facsimile or telegraphic notice, or verbal or telephonic
notice confirmed by written, facsimile or telegraphic notice, by the Representative to the Company
no later than 12:00 noon, New York City time, on the business day before the Firm Shares Closing
Date or at least two business days before the Option Shares Closing Date (as defined below), as the
case may be, setting forth the number of Option Shares to be purchased and the time and date (if
other than the Firm Shares Closing Date) of such purchase. The Representative, in its sole
discretion, shall determine the allocation and distribution of the Option Shares.
(c) Payment of the purchase price for, and delivery of certificates for, the Firm Shares shall
be made at the offices of ▇▇▇▇▇▇▇▇▇ & Company, Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
at 10:00 a.m., New York City time, on the third (or if the Shares are priced, as contemplated by
Rule 15c6-1(c) under the Exchange Act, after 4:30 p.m. New York City time, the fourth) business day
following the date of this Agreement or at such time on such other date, not later than ten (10)
business days after the date of this Agreement, as shall be agreed upon by the Company and the
Representative (such time and date of delivery and payment are called the “Firm Shares Closing
Date”). In addition, in the event that any or all of the Option Shares are purchased by ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, LLC, payment of the purchase price, and delivery of the certificates, for such Option
Shares shall be made at the above-mentioned offices, or at such other place as shall be agreed upon
by the Underwriters and the Company, on each date of delivery as specified in the notice from the
Representative to the Company (such time and date of delivery and payment are called the “Option
Shares Closing Date”). The Firm Shares Closing Date and any Option Shares Closing Date are called,
individually, a “Closing Date” and, together, the “Closing Dates.”
(d) Payment shall be made to the Company by wire transfer of immediately available funds
against delivery of the certificates to the Representative for the respective accounts of the
Underwriters for the Shares to be purchased by them.
(e) Certificates evidencing the Shares shall be registered in such names and shall be in such
denominations as the Representative shall request at least two full business days before the Firm
Shares Closing Date or, in the case of Option Shares, on the day of notice of exercise of the
option as described in Section 1(b) and shall be delivered by or on behalf of the Company to
the Representative through the facilities of the Depository Trust Company (“DTC”) for the account
of the Underwriters. The Company will cause the certificates representing the Shares to
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be made
available for checking and packaging, at such place as is designated by the Representative, on the
full business day before the Firm Shares Closing Date (or the Option Shares Closing Date in the
case of the Option Shares).
2. Representations and Warranties of the Company. The Company represents and warrants
to each Underwriter as of the date hereof, as of the Firm Shares Closing Date, and as of each
Option Shares Closing Date (if any), as follows:
(a) The Company meets the requirements for use of Form S-3 under the Securities Act including
the transaction requirements set forth in General Instruction 1.B.1 of such form. The Company filed
with the Commission the Registration Statement on such Form, including a Base Prospectus, for
registration under the Securities Act of the offering and sale of the Shares, and the Company has
prepared and used the Base Prospectus in connection with the offer and sale of the Shares. When
the Registration Statement or any amendment thereof or supplement thereto was or is declared
effective by the Commission and as of the date of the most recent amendment to the Registration
Statement, it (i) complied or will comply, in all material respects, with the requirements of the
Securities Act and the Rules and the Exchange Act and the rules and regulations of the Commission
thereunder and (ii) did not or will not, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to make the statements
therein not misleading. When the Base Prospectus or the Prospectus was first filed with the
Commission (whether filed as part of the Registration Statement or any amendment thereto or
pursuant to Rule 424 of the Rules) and when any amendment thereof or supplement thereto was first
filed with the Commission, such Base Prospectus or Prospectus as amended or supplemented complied
in all material respects with the applicable provisions of the Securities Act and the Rules and did
not as of the date thereof, and does not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading. If
applicable, the Prospectus delivered to the Underwriters for use in connection with this offering
was identical to the electronically transmitted copies thereof filed with the Commission pursuant
to ▇▇▇▇▇, except to the extent permitted by Regulation S-T. Notwithstanding the foregoing, none of
the representations and warranties in this paragraph 2(a) shall apply to statements in, or
omissions from, the Registration Statement or the Prospectus made in reliance upon, and in
conformity with, information herein or otherwise furnished in writing by the Underwriters
specifically for use in the Registration Statement or the Prospectus. With respect to the preceding
sentence, the Company acknowledges that the only information furnished in writing by the
Underwriters for use in the Registration Statement, the Base Prospectus or the Prospectus is the
statements set forth (i) in the first two sentences and the last sentence of the fifth paragraph
under the caption “Underwriting” in the Prospectus concerning commissions and expenses; (ii) in the
twelfth paragraph under the caption “Underwriting” in the Prospectus concerning lock-up agreements;
(iii) in the fourteenth paragraph under the caption “Underwriting” in the Prospectus concerning
electronic distribution; (iv) in the fifteenth, sixteenth, seventeenth and eighteenth paragraphs
under the caption “Underwriting” in the Prospectus concerning price stabilization, short positions
and penalty bids making by the Underwriters; and (v) in the section entitled “Notice to Investors”
(collectively, the “Underwriting Information”).
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(b) As of the Applicable Time (as hereinafter defined), neither (i) the Statutory Prospectus
(as hereinafter defined), the Designated FWPs (as hereinafter defined) and the information
regarding the price per share at which the Shares are being offered to the public, all considered
together (collectively, the “General Disclosure Package”), nor (ii) any individual Issuer Free
Writing Prospectus when considered together with the General Disclosure Package, included any
untrue statement of a material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that this representation and
warranty shall not apply to statements in or omissions in the General Disclosure Package made in
reliance upon and in conformity with the Underwriting Information.
Each Issuer Free Writing Prospectus, including (i) any electronic road show (including
without limitation any “bona fide electronic road show” as defined in Rule 433(h)(5) under the
Securities Act) that is a written communication transmitted by graphic means (each, a “Road Show”)
and (ii) any “issuer information” (as defined in Rule 433 of the Rules) that is the subject of Rule
433(f), (A) is identified in Schedule IV hereto (such identified Issuer Free Writing
Prospectuses being referred to herein as the “Designated FWPs”), (B) that the Company is required
to file pursuant to Rule 433(d) of the Rules has been, or will be, filed with the Commission in
accordance with the requirements of the Securities Act and the applicable Rules and (C) complied
when issued, and complies, in all material respects with the requirements of the Securities Act and
the Rules and the Exchange Act and the rules and regulations of the Commission thereunder.
As used in this Section and elsewhere in this Agreement:
“Applicable Time” means 9:15 a.m. (New York City time) on the date of this Underwriting
Agreement.
“Statutory Prospectus” as of any time means the Base Prospectus that is included in the
Registration Statement immediately prior to the Applicable Time, including any document
incorporated by reference therein together with the Designated FWPs.
“Issuer Free Writing Prospectus” means each “free writing prospectus” (as defined in Rule
405 of the Rules) prepared by or on behalf of the Company or used or referred to by the
Company in connection with the offering of the Shares, including, without limitation, each
Road Show and Designated FWP.
(c) The Registration Statement is effective under the Securities Act and no stop order
preventing or suspending the effectiveness of the Registration Statement or suspending or
preventing the use of the Prospectus or any “free writing prospectus”, as defined in Rule 405 under
the Rules, has been issued by the Commission and, to the Company’s knowledge, no proceedings for
that purpose have been instituted or are threatened under the Securities Act. Any required filing
of the Base Prospectus and/or the Prospectus and any supplement thereto pursuant
to Rule 424(b) of the Rules has been or will be made in the manner and within the time period
required by such Rule 424(b). Any material required to be filed by the Company pursuant to Rule
433(d) of the Rules has been or will be made in the manner and within the time period required by
such Rules.
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(d) The documents incorporated by reference in the Registration Statement, the Base Prospectus
and the Prospectus, at the time they became effective or were filed with the Commission, as the
case may be, complied in all material respects with the requirements of the Securities Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none
of such documents contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, and any further documents so
filed and incorporated by reference in the Registration Statement, the Base Prospectus and the
Prospectus, when such documents become effective or are filed with the Commission, as the case may
be, will conform in all material respects to the requirements of the Securities Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain
an untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the circumstances under which they
are made, not misleading.
(e) Each Issuer Free Writing Prospectus, if any, as of its issue date and at all
subsequent times through the Closing Dates or until any earlier date that the Company notified or
notifies the Representative as described in the next sentence, did not, does not and will not
include any information that conflicted, conflicts or will conflict with the information contained
in the Registration Statement, including any document incorporated by reference therein and any
prospectus supplement deemed to be a part thereof that has not been superseded or modified, the
Statutory Prospectus or the Prospectus.
If at any time following issuance of an Issuer Free Writing Prospectus through the Closing
Dates there occurred or occurs an event or development as a result of which such Issuer Free
Writing Prospectus conflicted or would conflict with the information contained in the Registration
Statement and any prospectus supplement deemed to be a part thereof that has not been superseded or
modified, or included in the Statutory Prospectus or the Prospectus or included or would include an
untrue statement of a material fact or omitted or would omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the light of the
circumstances prevailing at the subsequent time, not misleading, the Company has promptly notified
or will promptly notify the Representative and has promptly amended or supplemented or will
promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate
or correct such conflict, untrue statement or omission.
(f) The financial statements of the Company (including all notes and schedules thereto)
included or incorporated by reference in the Registration Statement, the Statutory Prospectus and
Prospectus present fairly, in all material respects, the financial position of the Company and its
consolidated subsidiaries at the dates indicated and the statement of operations, stockholders’
equity and cash flows of the Company and its consolidated subsidiaries for the periods specified;
and such financial statements and related schedules and notes thereto, and the unaudited financial
information filed with the Commission as part of the Registration Statement, have been prepared in
conformity with generally accepted accounting principles, consistently applied throughout the
periods involved (provided that non-year-end financial statements are subject to normal recurring
year-end audit adjustments that are not expected to be material in the aggregate and do not contain
all footnotes required by generally accepted accounting principles). The summary and selected
financial data included in the Statutory Prospectus and Prospectus, if
6
any,
present fairly, in all
material respects, the information shown therein as at the respective dates and for the respective
periods specified and have been presented on a basis consistent with the consolidated financial
statements set forth in the Prospectus and other financial information.
(g) Deloitte & Touche LLP (the “Auditor”) whose reports are filed with the Commission as a
part of the Registration Statement, are and, during the periods covered by its reports, was an
independent public accounting firm as required by the Securities Act and the Rules.
(h) The Company and each of its subsidiaries is duly organized, validly existing and in good
standing under the laws of their respective jurisdictions of incorporation or organization and each
such entity has all requisite power and authority to carry on its business as is currently being
conducted as described in the Statutory Prospectus and the Prospectus, and to own, lease and
operate its properties. The Company and each of its subsidiaries is duly qualified to do business
and is in good standing as a foreign corporation in each jurisdiction in which the nature of the
business conducted by it or location of the assets or properties owned, leased or licensed by it
requires such qualification, except for such jurisdictions where the failure to so qualify or be in
good standing, individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on the assets, properties, condition, financial or otherwise, or in the
results of operations, business affairs or business prospects of the Company and its subsidiaries
considered as a whole (a “Material Adverse Effect”); and to the Company’s knowledge, no proceeding
has been instituted in any such jurisdiction revoking, limiting or curtailing, or seeking to
revoke, limit or curtail, such power and authority or qualification. The Company has no subsidiary
other than its five wholly owned subsidiaries, MannKind LLC, MannKind Limited, Technosphere
International C.V., MannKind Netherlands B.V. and MannKind Deutchland GmbH, and does not control,
directly or indirectly, any other corporation, partnership, joint venture, association or other
business organization. Such subsidiaries, when considered in the aggregate as a single subsidiary,
do not constitute a “significant subsidiary” of the Company (as such term is defined in Rule
1-02(w) of Regulation S-X under the Securities Act) and are not otherwise material to the assets
and operations of the Company.
(i) The Registration Statement initially became effective on August 15, 2007. If, immediately
prior to the third anniversary of the initial effective date of the Registration Statement, any of
the Shares remain unsold by the Underwriters, the Company will, prior to that third anniversary
file, if it has not already done so, a new shelf registration statement relating to the Shares, in
a form satisfactory to the Representative, will use its best efforts to cause such registration
statement to be declared effective within 180 days after that third anniversary, and will take all
other action necessary or appropriate to permit the public offering and sale of the Shares to
continue as contemplated in the expired Registration Statement. References herein to the
“Registration Statement” shall include such new shelf registration statement.
(j) Except as set forth in the General Disclosure Package and the Prospectus, the Company and
each of its subsidiaries has all requisite corporate power and authority, and all necessary
authorizations, approvals, consents, orders, licenses, certificates and permits of and from all
governmental or regulatory bodies or any other person or entity (collectively, the “Permits”), to
own, lease and license its assets and properties and conduct its business, all of which are valid
and in full force and effect, except where the lack of such Permits, individually
7
or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect. The Company and each
of its subsidiaries has fulfilled and performed in all material respects all of its obligations
with respect to such Permits and no event has occurred that allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any other material impairment of
the rights of the Company or such subsidiary thereunder. Except as may be required under the
Securities Act and state and foreign Blue Sky laws, no other Permits are required to enter into,
deliver and perform this Agreement and to issue and sell the Shares.
(k) (i) At the earliest time after the filing of the Registration Statement that the Company
or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the
Rules) of the Shares and (ii) at the date hereof, the Company was not and is not an “ineligible
issuer,” as defined in Rule 405 of the Rules, including (but not limited to) the Company or any
other subsidiary in the preceding three years not having been convicted of a felony or misdemeanor
or having been made the subject of a judicial or administrative decree or order as described in
Rule 405 of the Rules.
(l) Except as set forth in the General Disclosure Package and the Prospectus, the Company and
each of its subsidiaries owns or possesses legally-enforceable rights (including license rights) to
use all patents, patent rights, inventions, trademarks, trademark applications, trade names,
service marks, copyrights, copyright applications, licenses, know-how and other similar rights and
proprietary knowledge (collectively, “Intangibles”) necessary for the conduct of its business.
Neither the Company nor any of its subsidiaries has received any written notice of, or is aware of,
any infringement of or conflict with asserted rights of others with respect to any Intangibles,
except as referenced in the General Disclosure Package and the Prospectus or that would not
reasonably be expected to have a Material Adverse Effect.
(m) The Company and each of its subsidiaries has good and marketable title in fee simple to
all real property owned by it, and good and marketable title to all other property owned by it, in
each case free and clear of all liens, encumbrances, claims, security interests and defects, except
as are described in the General Disclosure Package and the Prospectus or such as do not materially
affect the value of such property and do not materially interfere with the use made of such
property by the Company and its subsidiaries. All property held under lease by the Company and its
subsidiaries is held by them under valid, existing and enforceable leases, free and clear of all
liens, encumbrances, claims, security interests and defects, except such as are not material and do
not materially interfere with the use made of such property by the Company and its subsidiaries.
Subsequent to the respective dates as of which information is given in the Registration Statement
and the Prospectus, (i) there has not been any event which would reasonably be expected to have a
Material Adverse Effect; (ii) neither the Company nor any of its subsidiaries has sustained any
loss or interference with its assets, businesses or properties (whether owned or leased) from fire,
explosion, earthquake, flood or other calamity, whether or
not covered by insurance, or from any labor dispute or any court or legislative or other
governmental action, order or decree which would reasonably be expected to have a Material Adverse
Effect; and (iii) since the date of the latest balance sheet included or incorporated by reference
in the Registration Statement and the Prospectus, except as otherwise disclosed in the Registration
Statement and the Prospectus, neither the Company nor its subsidiaries has (A) issued any
securities (other than securities pursuant to the Company’s equity incentive plans) or incurred any
liability or obligation, direct or contingent, for borrowed money, except such
8
liabilities or
obligations incurred in the ordinary course of business, (B) entered into any transaction not in
the ordinary course of business or (C) declared or paid any dividend or made any distribution on
any shares of its stock or redeemed, purchased or otherwise acquired or agreed to redeem, purchase
or otherwise acquire any shares of its capital stock.
(n) There is no document, contract or other agreement required to be described in the
Registration Statement, the Statutory Prospectus or the Prospectus or to be filed as an exhibit to
the Registration Statement which is not described or filed as required by the Securities Act or
Rules or incorporated therein by reference as permitted by the Rules. Each description of a
contract, document or other agreement in the Registration Statement, the Statutory Prospectus or
the Prospectus accurately reflects in all respects the material terms of the underlying contract,
document or other agreement. Each contract, document or other agreement described in the
Registration Statement, the Statutory Prospectus or the Prospectus or listed in the exhibits to the
Registration Statement or incorporated by reference is in full force and effect and is valid and
enforceable by and against the Company or any of its subsidiaries, as the case may be, in
accordance with its terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’
rights generally and by general equitable principles. Neither the Company nor any of its
subsidiaries, if a subsidiary is a party, nor to the Company’s knowledge, any other party is in
default in the observance or performance of any term or obligation to be performed by it under any
such agreement, and no event has occurred which with notice or lapse of time or both would
constitute such a default, in any such case which default or event, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect. No default exists, and
no event has occurred which with notice or lapse of time or both would constitute a default, in the
due performance and observance of any term, covenant or condition, by the Company or its
subsidiary, if a subsidiary is a party thereto, of any other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or its properties or business
or a subsidiary or its properties or business may be bound or affected which default or event,
individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.
(o) The statistical and market related data included in the Registration Statement, the
Statutory Prospectus or the Prospectus are based on or derived from sources that the Company
believes to be reliable and accurate.
(p) Neither the Company nor any subsidiary (i) is in violation of its certificate or articles
of incorporation or organization, by-laws, certificate of formation, limited liability company
agreement, partnership agreement or other organizational documents, (ii) is in default
under, and no event has occurred which, with notice or lapse of time, or both, would
constitute a default under, or result in the creation or imposition of any lien, charge, mortgage,
pledge, security interest, claim, limitation on voting rights, equity, trust or other encumbrance,
preferential arrangement, defect or restriction of any kind whatsoever, upon, any property or
assets of the Company or any subsidiary pursuant to, any bond, debenture, note, indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is subject or (iii) is in
violation of any statute, law, rule, regulation, ordinance, directive, judgment, decree or order of
any judicial, regulatory or other legal or governmental agency or body, foreign or domestic, except
(in the
9
case of clauses (ii) and (iii) above) for violations or defaults that would not
(individually or in the aggregate) reasonably be expected to have a Material Adverse Effect.
(q) This Agreement has been duly authorized, executed and delivered by the Company.
(r) Neither the execution, delivery and performance of this Agreement by the Company nor the
consummation of any of the transactions contemplated hereby (including, without limitation, the
issuance and sale by the Company of the Shares) will give rise to a right to terminate or
accelerate the due date of any payment due under, or conflict with or result in the breach of any
term or provision of, or constitute a default (or an event which with notice or lapse of time or
both would constitute a default) under, or require any consent or waiver under, or result in the
execution or imposition of any lien, charge or encumbrance upon any properties or assets of the
Company or its subsidiaries pursuant to the terms of, any indenture, mortgage, deed of trust or
other agreement or instrument to which the Company or any of its subsidiaries is a party or by
which either the Company or its subsidiaries or any of their properties or businesses is bound, or
any franchise, license, permit, judgment, decree, order, statute, rule or regulation applicable to
the Company or any of its subsidiaries, except where it would not reasonably be expected to have a
Material Adverse Effect, or violate any provision of the charter or by-laws of the Company or any
of its subsidiaries, except for such consents or waivers which have already been obtained and are
in full force and effect.
(s) On the date set forth therein, the Company had the authorized and outstanding capital
stock as set forth under the caption “Capitalization” in the Statutory Prospectus (and any similar
sections or information, if any, contained in any Issuer Free Writing Prospectus). The
certificates evidencing the Shares are in due and proper legal form and have been duly authorized
for issuance by the Company. All of the issued and outstanding shares of Common Stock have been
duly and validly issued and are fully paid and nonassessable. There are no statutory preemptive or
other similar rights to subscribe for or to purchase or acquire any shares of Common Stock of the
Company or any of its subsidiaries or any such rights pursuant to its Certificate of Incorporation
or by-laws or any agreement or instrument to or by which the Company or any of its subsidiaries is
a party or bound. The Shares, when issued and sold pursuant to this Agreement, will be duly and
validly issued, fully paid and nonassessable and none of them will be issued in violation of any
preemptive or other similar right. Except as disclosed in the Registration Statement, the
Statutory Prospectus and the Prospectus, there is no outstanding option, warrant or other right
calling for the issuance by the Company of, and there is no commitment, plan or arrangement by the
Company to issue, any share of stock of the
Company or any of its subsidiaries or any security convertible into, or exercisable or
exchangeable for, such stock. The exercise price of each option to acquire Common Stock (each, a
“Company Stock Option”) is no less than the fair market value of a share of Common Stock as
determined on the date of grant of such Company Stock Option. All grants of Company Stock Options
were validly issued and properly approved by the Board of Directors of the Company, a committee
thereof or an individual with authority duly delegated by the Board of Directors of the Company or
a committee thereof, in material compliance with (i) all applicable laws and (ii) the terms of the
plans under which such Company Stock Options were issued and were recorded on the Company’s
financial statements in accordance with generally accepted accounting principles,
10
and no such
grants involved any “back dating”, “forward dating,” “spring loading” or similar practices with
respect to the effective date of grant. The Common Stock and the Shares conform in all material
respects to all statements in relation thereto contained in the Registration Statement, the
Statutory Prospectus and the Prospectus. All outstanding shares of capital stock of each of the
Company’s subsidiaries have been duly authorized and validly issued, and are fully paid and
nonassessable and are owned directly by the Company or by another wholly owned subsidiary of the
Company free and clear of any security interests, liens, encumbrances, equities or claims, other
than those described in the Statutory Prospectus and the Prospectus.
(t) No holder of any security of the Company has any right granted by the Company,
which has not been waived or previously satisfied, to have any security owned by such holder
included in the Registration Statement or to demand registration of the sale of any security owned
by such holder for a period of 60 days after the date of this Agreement. Each director and
executive officer of the Company listed on Schedule III hereto has delivered to the
Representative his or her executed written lock-up agreement in the form attached to this Agreement
as Exhibit A hereto or in such form as may be approved in writing by the Representative
(“Lock-Up Agreement”).
(u) There are no legal or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its subsidiaries could individually
or in the aggregate have a Material Adverse Effect; and, to the knowledge of the Company, no such
proceedings are threatened or contemplated by governmental authorities or threatened by others.
(v) All necessary corporate action has been duly and validly taken by the Company to authorize
the execution, delivery and performance of this Agreement and the issuance and sale of the Shares
by the Company.
(w) Neither the Company nor any of its subsidiaries is involved in any labor dispute nor, to
the knowledge of the Company, is any such dispute threatened, which dispute would reasonably be
expected to have a Material Adverse Effect. The Company is not aware of any existing or imminent
labor disturbance by the employees of any of its principal suppliers or contractors which would
reasonably be expected to have a Material Adverse Effect. The Company is not aware of any
threatened or pending litigation between the Company or its subsidiaries and any of its executive
officers which, if adversely determined, would reasonably be expected to have a Material Adverse
Effect.
(x) No transaction has occurred between or among the Company and any of its officers or
directors, shareholders or any affiliate or affiliates of any such officer or director or
shareholder that is required to be described in and is not described in the Registration Statement,
the Statutory Prospectus and the Prospectus.
(y) The Company has not taken, nor will it take, directly or indirectly, any action designed
to or which might reasonably be expected to cause or result in, or which has constituted or which
might reasonably be expected to constitute, the stabilization or manipulation of the
11
price of the
Common Stock or any security of the Company to facilitate the sale or resale of any of the Shares.
(z) The Company and each of its subsidiaries has filed all Federal, state, local and foreign
tax returns which are required to be filed through the date hereof, which returns are true and
correct in all material respects or has received timely extensions thereof, and has paid all taxes
shown on such returns and all assessments received by it to the extent that the same are material
and have become due, except in each case where such failure to file or pay would not reasonably be
expected to have a Material Adverse Effect. There are no tax audits or investigations pending
which, if adversely determined, would reasonably be expected to have a Material Adverse Effect; nor
to the Company’s knowledge are there any material proposed additional tax assessments against the
Company or any of its subsidiaries.
(aa) The Shares have been duly authorized for listing on the NASDAQ Stock Market LLC’s
(“Nasdaq”) Global Market.
(bb) The Company has taken no action designed to, or likely to have the effect of, terminating
the registration of the Common Stock under the Exchange Act or the listing of the Common Stock on
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.
(cc) The books, records and accounts of the Company and its subsidiaries accurately and fairly
reflect, in all material respects, the transactions in, and dispositions of, the assets of, and the
results of operations of, the Company and its subsidiaries. The Company and its subsidiaries
maintain a system of internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management’s general or specific authorizations,
(ii) transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles and to maintain asset accountability,
(iii) access to assets is permitted only in accordance with management’s general or specific
authorization and (iv) the recorded accountability for assets is compared with the existing assets
at reasonable intervals and appropriate action is taken with respect to any differences.
(dd) The Company has established and maintains disclosure controls and procedures (as such
term is defined in Rule 13a-15 under the Exchange Act), which: (i) are designed to ensure that
material information relating to the Company is made known to the Company’s principal executive
officer and its principal financial officer by others within the Company,
particularly during the periods in which the periodic reports required under the Exchange Act
are required to be prepared; (ii) provide for the periodic evaluation of the effectiveness of such
disclosure controls and procedures at the end of the periods in which the periodic reports are
required to be prepared; and (iii) are effective in all material respects to perform the functions
for which they were established.
(ee) Based on the evaluation of its disclosure controls and procedures, the Company is not
aware of (i) any significant deficiency in the design or operation of internal controls which could
adversely affect the Company’s ability to record, process, summarize and report financial
12
data or
any material weaknesses in internal controls; or (ii) any fraud, whether or not material, that
involves management or other employees who have a role in the Company’s internal controls.
(ff) Except as described in the Statutory Prospectus and the Prospectus and as pre-approved in
accordance with the requirements set forth in Section 10A of the Exchange Act, the Auditor has not
been engaged by the Company to perform any “prohibited activities” (as defined in Section 10A of
the Exchange Act).
(gg) Except as described in the Statutory Prospectus and the Prospectus, there are no material
off-balance sheet arrangements (as defined in Item 303 of Regulation S-K) that have or are
reasonably likely to have a material current or future effect on the Company’s financial condition,
revenues or expenses, changes in financial condition, results of operations, liquidity, capital
expenditures or capital resources.
(hh) The Company’s Board of Directors has validly appointed an audit committee whose
composition satisfies the requirements of Rule 5605(c)(2) of the Listing Rules of NASDAQ (the
“NASDAQ Rules”) and the Company’s Board of Directors and/or the audit committee has adopted a
charter that satisfies the requirements of Rule 5605(c)(1) of the NASDAQ Rules. The audit
committee has reviewed the adequacy of its charter within the past twelve months.
(ii) There is and has been no failure on the part of the Company or any of its directors or
officers, in their capacities as such, to comply with any applicable provision of the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, including, without limitation, Section 402 related to loans and
Sections 302 and 906 related to certifications.
(jj) The Company and its subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are customary in the businesses
in which they are engaged or propose to engage after giving effect to the transactions described in
the Statutory Prospectus and the Prospectus; all policies of insurance and fidelity or surety bonds
insuring the Company or any of its subsidiaries or the Company’s or its subsidiaries’ respective
businesses, assets, employees, officers and directors are in full force and effect; the Company and
each of its subsidiaries are in compliance with the terms of such policies and instruments in all
material respects; and neither the Company nor any subsidiary of the Company has any reason to
believe that it will not be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that is not materially greater than the
current cost of such coverage. Neither the Company nor any of its subsidiaries has been denied any
insurance coverage which it has sought or for which it has applied.
(kk) Each approval, consent, order, authorization, designation, declaration or filing of, by
or with any regulatory, administrative or other governmental body necessary in connection with the
execution and delivery by the Company of this Agreement and the consummation of the transactions
herein contemplated required to be obtained or performed by the Company (except such additional
steps as may be required by the Financial Industry Regulatory Authority (“FINRA”) or may be
necessary to qualify the Shares for public offering by the Underwriters
13
under the state securities
or Blue Sky laws) has been obtained or made and is in full force and effect.
(ll) There are no affiliations with FINRA among the Company’s officers or directors, except as
set forth in the Registration Statement or otherwise disclosed in writing to the Representative.
(mm) As of the date of filing the Registration Statement and the date hereof, the Company
satisfied and satisfies, respectively, the pre-1992 eligibility requirements for the use of a
registration statement on Form S-3 in connection with the offering of the Shares contemplated
thereby (the pre-1992 eligibility requirements for the use of the registration statement on Form
S-3 include (i) having a non-affiliate, public common equity float of at least $150 million or a
non-affiliate, public common equity float of at least $100 million and annual trading volume of at
least three million shares and (ii) having been subject to the Exchange Act reporting requirements
for a period of 36 months).
(nn) (i) Each of the Company and each of its subsidiaries is in compliance in all material
respects with all rules, laws and regulation relating to the use, treatment, storage and disposal
of toxic substances and protection of health or the environment (“Environmental Law”) which are
applicable to its business; (ii) neither the Company nor its subsidiaries has received any notice
from any governmental authority or third party of an asserted claim under Environmental Laws; (iii)
each of the Company and each of its subsidiaries has received all permits, licenses or other
approvals required of it under applicable Environmental Laws to conduct its business and is in
compliance with all terms and conditions of any such permit, license or approval; (iv) to the
Company’s knowledge, no facts currently exist that will require the Company or any of its
subsidiaries to make future material capital expenditures to comply with Environmental Laws; and
(v) no property which is or has been owned, leased or occupied by the Company or its subsidiaries
has been designated as a Superfund site pursuant to the Comprehensive Environmental Response,
Compensation of Liability Act of 1980, as amended (42 U.S.C. Section 9601, et. seq.) (“CERCLA”), or
otherwise designated as a contaminated site under applicable state or local law. Neither the
Company nor any of its subsidiaries has been named as a “potentially responsible party” under the
CERCLA 1980.
(oo) In the ordinary course of its business, the Company periodically reviews the effect of
Environmental Laws on the business, operations and properties of the Company and its subsidiaries,
in the course of which the Company identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with 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, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate, have a Material Adverse Effect.
(pp) The Company is not and, after giving effect to the offering and sale of the Shares and
the application of proceeds thereof as described in the Statutory Prospectus and the Prospectus,
will not be an “investment company” within the meaning of the Investment Company Act of 1940, as
amended (the “Investment Company Act”).
14
(qq) The Company or any other person associated with or acting on behalf of the Company
including, without limitation, any director, officer, agent or employee of the Company or its
subsidiaries, has not, directly or indirectly, while acting on behalf of the Company or its
subsidiaries (i) used any corporate funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to political activity; (ii) made any unlawful payment to foreign or
domestic government officials or employees or to foreign or domestic political parties or campaigns
from corporate funds; (iii) violated any provision of the Foreign Corrupt Practices Act of 1977, as
amended; or (iv) made any other unlawful payment.
(rr) The operations of the Company and its subsidiaries are in compliance in all material
respects 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
required jurisdictions, the rules and regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any governmental agency having
jurisdiction over the Company (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 it subsidiaries with respect to the Money Laundering Laws is
pending, or to the best knowledge of the Company, threatened.
(ss) Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any
director, officer, agent, employee or affiliate 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 the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary,
joint venture partner or other person or entity, for the purpose of financing the activities of any
person known by the Company to be currently subject to any U.S. sanctions administered by OFAC.
(tt) Except as described in the Statutory Prospectus and the Prospectus, the Company has not
sold or issued any shares of Common Stock during the six-month period preceding the date of the
Prospectus, including any sales pursuant to Rule 144A under, or Regulations D or S of, the
Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock
options plans or other employee compensation plans or pursuant to outstanding options, rights or
warrants.
(uu) The Company has fulfilled its obligations, if any, under the minimum funding standards of
Section 302 of the U.S. Employee Retirement Income Security Act of 1974 (“ERISA”) and the
regulations and published interpretations thereunder with respect to each “plan” as defined in
Section 3(3) of ERISA and such regulations and published interpretations in which its employees are
eligible to participate and each such plan is in compliance in all material respects with the
presently applicable provisions of ERISA and such regulations and published
interpretations. No “Reportable Event” (as defined in Section 4043 of ERISA) has occurred with
respect to any “Pension Plan” (as defined in ERISA) for which the Company could have any material
liability.
(vv) None of the Company, its directors or its officers has distributed nor will distribute
prior to the later of (i) the Firm Shares Closing Date, or the Option Shares Closing
15
Date, and (ii) completion of the distribution of the Shares, any offering material in
connection with the offering and sale of the Shares other than the Prospectus, the Registration
Statement and other materials, if any, permitted by the Securities Act and consistent with Section
5(d) below.
(ww) The clinical, pre-clinical and other studies and tests conducted by the Company or in
which the Company or its products or product candidates have participated, or that are described in
the Registration Statement, the Statutory Prospectus and the Prospectus or the results of which are
referred to in the Registration Statement, the Statutory Prospectus or the Prospectus, and such
studies and tests conducted on behalf of or sponsored by the Company or that the Company intends to
rely on in support of regulatory approval by the U.S. Food and Drug Administration (the “FDA”) or
foreign regulatory agencies, were and, if still pending, are, to the Company’s knowledge, being
conducted in all material respects in accordance with standard accepted medical and scientific
research procedures and, to the Company’s knowledge, the protocols established by the Company for
such studies and tests. The descriptions in the Registration Statement, the Statutory Prospectus
and the Prospectus of the results of such studies and tests are accurate and complete in all
material respects and fairly present the data derived from such studies and tests, and except as
set forth in the Registration Statement, the Statutory Prospectus and the Prospectus, the Company
has no knowledge of any other studies or tests, the results of which the Company believes
reasonably call into question the results described or referred to in the Registration Statement,
the Statutory Prospectus and the Prospectus when viewed in the context in which such results are
described. Except to the extent disclosed in the Registration Statement, the Statutory Prospectus
and the Prospectus, the Company has not received any written notices or other correspondence from
the FDA or any other domestic or foreign governmental agency requiring the termination, suspension
or modification (other than such modifications as are normal in the regulations, any such
modification which are material have been disclosed to you) of any clinical or pre-clinical studies
or tests that are described in the Registration Statement, the Statutory Prospectus or the
Prospectus or the results of which are referred to in the Registration Statement, the Statutory
Prospectus or the Prospectus.
3. [RESERVED]
4. Conditions of the Underwriters’ Obligations. The obligations of the Underwriters
under this Agreement are several and not joint. The respective obligations of the Underwriters to
purchase the Shares are subject to each of the following terms and conditions:
(a) Notification that the Registration Statement has become effective shall have been received
by the Representative and the Prospectus shall have been timely filed with the Commission in
accordance with Section 5(a) of this Agreement and any material required to be filed by the Company
pursuant to Rule 433(d) of the Rules shall have been timely filed with the Commission in accordance
with such Rule.
(b) No order preventing or suspending the use of the Prospectus or any “free writing
prospectus” (as defined in Rule 405 of the Rules) shall have been or shall be in effect and no
order suspending the effectiveness of the Registration Statement shall be in effect and no
proceedings for such purpose shall be pending before or threatened by the Commission, and any
requests for additional information on the part of the Commission (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been complied with to the
16
satisfaction of the Commission and the Representative. If the Company has elected to rely upon
Rule 430A, information previously omitted from the effective
Registration Statement pursuant to Rule 430A shall have been transmitted to the Commission for filing pursuant to Rule 424(b)
within the prescribed time period and the Company shall have provided evidence reasonably
satisfactory to the Representative of such timely filing, or a post-effective amendment providing
such information shall have been promptly filed and declared effective in accordance with the
requirements of Rule 430A.
(c) The representations and warranties of the Company contained in this Agreement and in the
certificates delivered pursuant to Section 4(d) shall be true and correct when made and in all
material respects on and as of each Closing Date as if made on such date; provided, however, that
such materiality qualifier shall not be applicable to any representation or warranty that is
already qualified or modified by materiality or Material Adverse Effect in the text thereof. The
Company shall have performed all covenants and agreements in all material respects and satisfied
all the conditions contained in this Agreement required to be performed or satisfied by them at or
before such Closing Date.
(d) The Representative shall have received on each Closing Date a certificate, addressed to
the Representative and dated such Closing Date, of the chief executive or chief operating officer
and the chief financial officer or chief accounting officer of the Company to the effect that: (i)
the representations, warranties and agreements of the Company in this Agreement were true and
correct when made and are true and correct in all material respects as of such Closing Date;
provided, however, that such materiality qualifier shall not be applicable to any representation or
warranty that is already qualified or modified by materiality or Material Adverse Effect in the
text thereof; (ii) the Company has performed all of its covenants and agreements in all material
respects and satisfied all conditions contained herein required to be performed or satisfied by the
Company; (iii) they have carefully examined the Registration Statement, the Prospectus, the General
Disclosure Package, and any individual Issuer Free Writing Prospectus and, in their opinion (A) as
of the date of this Agreement, which is the most recent Effective Date of the Registration
Statement, the Registration Statement did not and as of its date, the Prospectus did not include,
and as of the Applicable Time, neither (i) the General Disclosure Package, nor (ii) any individual
Issuer Free Writing Prospectus, when considered together with the General Disclosure Package,
included any untrue statement of a material fact and as of the times described above such
documents did not omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading,
and (B) since the Effective Date no event has occurred which should have been set forth in a
supplement or otherwise required an amendment to the Registration Statement, the Statutory
Prospectus or the Prospectus that has not been so disclosed; and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and, to their knowledge, no proceedings
for that purpose have been instituted or are pending under the Securities Act.
(e) The Representative shall have received: (i) simultaneously with the execution of this
Agreement a signed letter from the Auditor addressed to the Representative and dated the date of
this Agreement, in form and substance reasonably satisfactory to the Representative, containing
statements and information of the type ordinarily included in accountants’ “comfort letters” to
underwriters with respect to the financial statements and certain financial information
17
contained in the Registration Statement and the General Disclosure Package, and (ii) on each
Closing Date, a signed letter from the Auditor addressed to the
Representative and dated the date of such Closing Date(s), in form and substance reasonably satisfactory to the Representative
containing statements and information of the type ordinarily included in accountants’ “comfort
letters” to underwriters with respect to the financial statements and certain financial information
contained in the Registration Statement and the Prospectus.
(f) The Representative shall have received on each Closing Date from ▇▇▇▇▇▇ Godward Kronish
LLP, counsel for the Company, (i) an opinion, addressed to the Representative and dated such
Closing Date, stating in effect the matters set forth on Exhibit B-1 hereto, and (ii) a
negative assurance letter, addressed to the Representative and dated such Closing Date, stating in
effect the matters set forth on Exhibit B-2 hereto (each with appropriate modifications
reasonably acceptable to the Representative for any opinion or negative assurance letter delivered
on any subsequent Closing Date).
(g) The Representative shall have received on each Closing Date from K&L Gates LLP,
intellectual property counsel for the Company, an opinion, addressed to the Representative and
dated such Closing Date, stating in effect the matters set forth on Exhibit C hereto (with
appropriate modifications reasonably acceptable to the Representative for any opinion delivered on
any subsequent Closing Date).
(h) The Representative shall have received on each Closing Date a certificate, addressed to
the Representative and dated such Closing Date, of the General Counsel of the Company, stating in
effect the matters set forth on Exhibit D hereto (with appropriate modifications reasonably
acceptable to the Representative for any opinion delivered on any subsequent Closing Date).
(i) The Representative shall have received from ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, a favorable opinion,
addressed to the Representative and dated such Closing Date, covering such matters as are
customarily covered in transactions of this type, and the Company shall have furnished to ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇ LLP such documents as they may reasonably request for the purpose of enabling them to pass
upon such matters.
(j) All proceedings taken in connection with the sale of the Firm Shares and the Option Shares
as herein contemplated shall be reasonably satisfactory in form and substance to the
Representative, and its counsel.
(k) The Representative shall have received copies of the Lock-up Agreements executed by each
person listed on Schedule III hereto.
(l) The Shares shall have been approved for listing on the Nasdaq Global Market, subject only
to official notice of issuance, and the Company shall not have received any notice that it is not
in compliance with the listing or maintenance requirements of Nasdaq.
(m) The Representative shall be reasonably satisfied that since the respective dates as of
which information is given in the Registration Statement, the Statutory Prospectus, the General
Disclosure Package and the Prospectus, (i) there shall not have been any material change
18
in the capital stock of the Company (other than as a result of the exercise of outstanding stock
options or other equity-based rights described in the Registration
Statement, the Statutory Prospectus, the General Disclosure Package and the Prospectus) or any material change in the
indebtedness (other than in the ordinary course of business) of the Company, (ii) except as set
forth or contemplated by the Registration Statement, the Statutory Prospectus, the General
Disclosure Package or the Prospectus, no material oral or written agreement or other transaction
shall have been entered into by the Company that is not in the ordinary course of business or that
could reasonably be expected to result in a material reduction in the future earnings of the
Company, (iii) no loss or damage (whether or not insured) to the property of the Company shall have
been sustained that had or could reasonably be expected to have a Material Adverse Effect, (iv) no
legal or governmental action, suit or proceeding affecting the Company or any of its properties
that is material to the Company or that affects or could reasonably be expected to affect the
transactions contemplated by this Agreement shall have been instituted or threatened and (v) there
shall not have been any material change in the assets, properties, condition (financial or
otherwise), or in the results of operations, business affairs or business prospects of the Company
or its subsidiaries considered as a whole that makes it impractical or inadvisable in the
Representative’s judgment to proceed with the purchase or offering of the Shares as contemplated
hereby.
(n) The Company shall have furnished or caused to be furnished to the Representative such
further certificates or documents as the Representative shall have reasonably requested.
5. Covenants and other Agreements of the Company and the Underwriters.
(a) The Company covenants and agrees as follows:
(i) The Company will use its best efforts to cause the Registration
Statement, if not effective at the time of execution of this Agreement, and any
amendments thereto, to promptly become effective. The Company shall prepare the
Prospectus in a form reasonably approved by the Representative and file such
Prospectus pursuant to Rule 424(b) under the Securities Act not later than the
Commission’s close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by the Rules. The Company will file with the Commission all
Issuer Free Writing Prospectuses in the time and manner required under Rule
433(d) of the Rules.
(ii) The Company shall promptly advise the Representative in writing after
it receives notice thereof, (A) when any post-effective amendment to the
Registration Statement shall have become effective or any supplement to the
Prospectus shall have been filed, (B) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or for any additional
information related to the offering of the Shares, (C) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of the Base
Prospectus or any “free writing prospectus”, as defined in Rule 405 of the
Rules, or the institution or threatening of any
19
proceeding for that purpose and (D) of the receipt by the Company of any
notification with respect to the suspension of the qualification of
the Shares for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Company shall not file any amendment of the
Registration Statement or supplement to the Prospectus or any document
incorporated by reference in the Registration Statement or any Issuer Free
Writing Prospectus unless the Company has furnished the Representative a copy
for its review prior to filing and shall not file any such proposed amendment or
supplement to which the Representative reasonably objects. The Company shall
use its best efforts to prevent the issuance of any such stop order and, if
issued, to obtain as soon as possible the withdrawal thereof
(iii) If, at any time when a prospectus relating to the Shares (or, in lieu
thereof, the notice referred to in Rule 173(a) of the Rules) is required to be
delivered under the Securities Act and the Rules or the Exchange Act, any event
occurs as a result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omits to state any material
fact necessary to make the statements therein in the light of the circumstances
under which they were made not misleading, or if it shall be necessary, in the
reasonable judgment of the Company, to amend or supplement the Prospectus to
comply with the Securities Act or the Rules, the Company promptly shall prepare
and file with the Commission, subject to the second sentence of paragraph (ii)
of this Section 5(a), an amendment or supplement reasonably acceptable to the
Representative which shall correct such statement or omission or an amendment
which shall effect such compliance.
(iv) If at any time following issuance of an Issuer Free Writing Prospectus
through the Closing Dates there occurs an event or development as a result of
which such Issuer Free Writing Prospectus would conflict with the information
contained in the Registration Statement, including any prospectus supplement
deemed to be a part thereof that has not been superseded or modified, or would
include an untrue statement of a material fact or would omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances prevailing at the subsequent time,
not misleading, the Company will promptly notify the Representative and will
promptly amend or supplement, at its own expense, such Issuer Free Writing
Prospectus to eliminate or correct such conflict, untrue statement or omission.
(v) The Company agrees to make generally available (through ▇▇▇▇▇ or
otherwise) to its security holders and to the Representative as soon as
practicable, but in any event not later than 45 days after the end of the
12-month period beginning at the end of the fiscal quarter of the Company during
which the most recent Effective Date occurs (or 90 days if such 12-month period
coincides with the Company’s fiscal year), an earning statement (which need not
be audited) of the Company, covering such
20
12-month period, which shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 of the Rules.
(vi) Upon written request, the Company shall furnish to the Representative
and counsel for the Underwriters, without charge, signed copies of the
Registration Statement (including all exhibits thereto and amendments thereof)
and to each other Underwriter, without charge, a copy of the Registration
Statement (without exhibits thereto) and all amendments thereof and, so long as
delivery of a prospectus by an Underwriter or dealer may be required by the
Securities Act or the Rules, as many copies of the Base Prospectus, any Issuer
Free Writing Prospectus and the Prospectus and any amendments thereof and
supplements thereto as the Representative may reasonably request. If
applicable, the copies of the Registration Statement, the Base Prospectus, any
Issuer Free Writing Prospectus and Prospectus and each amendment and supplement
thereto furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except
to the extent permitted by Regulation S-T.
(vii) The Company shall cooperate with the Representative and counsel for
the Underwriters in endeavoring to qualify the Shares for offer and sale in
connection with the offering under the laws of such jurisdictions in the U.S. as
the Representative may reasonably request and shall maintain such qualifications
in effect so long as required for the distribution of the Shares; provided,
however, that the Company shall not be required in connection therewith, or as a
condition thereof, to qualify as a foreign corporation or to execute a general
consent to service of process in any jurisdiction or subject itself to taxation
as doing business in any jurisdiction.
(viii) The Company, during the period when the Prospectus (or in lieu
thereof, the notice referred to in Rule 173(a) of the Rules) is required to be
delivered under the Securities Act and the Rules or the Exchange Act, will file
all reports and other documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the Exchange Act within the time periods
required by the Exchange Act and the regulations promulgated thereunder.
(ix) Without the prior written consent of the Representative, for a period
of 60 days after the date of this Agreement, the Company shall not issue, sell
or register with the Commission (other than on Form S-8 or on any successor
form), or otherwise dispose of, directly or indirectly, any equity securities of
the Company (or any securities convertible into, exercisable for or exchangeable
for equity securities of the Company), except for the issuance of the Shares
pursuant to the Registration Statement, the issuance of shares pursuant to the
Company’s existing stock option plan or bonus plan as described in the
Registration Statement and the Prospectus, or the issuance of shares in
connection with a strategic partnership, joint venture, collaboration, lending
or other similar arrangement, or in connection with the acquisition or license by the Company of any
business, products, facilities or technologies; provided that the recipient of
shares in connection with any such strategic partnership, joint venture,
collaboration, lending or other similar arrangement, or in connection with the
acquisition or
21
license by the Company of any business, products, facilities or
technologies shall agree to execute a Lock-Up Agreement in the form attached as
Exhibit A hereto for the remainder of the term of such Lock-Up
Agreement. In the event that during this period, (A) any shares are issued
pursuant to the Company’s existing equity incentive plans or bonus plans that
are exercisable during such 60-day period or (B) any registration is effected on
Form S-8 or on any successor form relating to shares that are exercisable during
such 60-day period, the Company shall obtain the written agreement of such
grantee or purchaser or holder of such registered securities that, for a period
of 60 days after the date of this Agreement, such person will not, without the
prior written consent of the Representative, offer for sale, sell, distribute,
grant any option for the sale of, or otherwise dispose of, directly or
indirectly, or exercise any registration rights with respect to, any shares of
Common Stock (or any securities convertible into, exercisable for, or
exchangeable for any shares of Common Stock) owned by such person; provided,
however, that the obligation of the Company to obtain such an agreement shall
only apply if such grantee or purchaser or holder of such registered securities
is an executive officer or director of the Company listed on Schedule
III hereto or is the beneficial owner (determined in accordance with Rule
13d-3 of the Exchange Act) of one percent (1%) of more of the Company’s Common
Stock then outstanding after such grant, purchase or holding. Notwithstanding
the foregoing, (i) the Company represents and warrants that each such grantee or
purchaser or holder of such registered securities not subject to the proviso at
the end of the previous sentence shall be subject to similar lockup restrictions
as set forth on Exhibit A attached hereto and the Company shall enforce
such rights and impose stop-transfer restrictions on any such sale or other
transfer or disposition of such shares until the end of the applicable period
and (ii) if (x) during the last 17 days of the 60-day period described in this
Section 5(a)(ix) the Company issues an earnings release or material news or a
material event relating to the Company occurs; or (y) prior to the expiration of
such 60-day period, the Company announces that it will release earnings results
during the 16 day period beginning on the last day of the 60-day period; the
restrictions imposed by this Section 5(a)(ix) shall continue to apply until the
expiration of the 60-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event; provided,
however, that this sentence shall not apply if the research published or
distributed on the Company is compliant under Rule 139 of the Securities Act and
the Company’s securities are actively traded as defined in Rule 101(c)(1) of
Regulation M of the Exchange Act.
(x) On or before completion of this offering, the Company shall make all
filings required to be made by the Company under applicable securities laws and
by the Nasdaq Global Market (including any required
22
registration under the
Exchange Act); provided, however, the Company shall make all filings required by
Nasdaq that may be filed after the completion of the offering of the Shares
within the period required by Nasdaq.
(xi) Prior to the Closing Date, the Company will issue no press release or
other communications directly or indirectly and hold no press conference with
respect to the Company, the condition, financial or otherwise, or the earnings,
business affairs or business prospects of any of them, or the offering of the
Shares without the prior written consent of the Representative (which consent
shall not be unreasonably withheld or delayed), unless in the judgment of the
Company and its counsel, and after notification to the Representative, such
press release or communication is required by law.
(xii) The Company will apply the net proceeds from the offering of the
Shares in the manner set forth under “Use of Proceeds” in the Prospectus.
(b) The Company agrees to pay, or reimburse if paid by the Representative, whether or not the
transactions contemplated hereby are consummated or this Agreement is terminated, all costs and
expenses incident to the public offering of the Shares and the performance of the obligations of
the Company under this Agreement including those relating to: (i) the preparation, printing,
reproduction filing and distribution of the Registration Statement including all exhibits thereto,
the Base Prospectus, the Prospectus, any Issuer Free Writing Prospectus, all amendments and
supplements thereto and any document incorporated by reference therein, and the printing, filing
and distribution of this Agreement; (ii) the preparation and delivery of certificates for the
Shares to the Underwriters; (iii) the registration or qualification of the Shares for offer and
sale under the securities or Blue Sky laws of the various jurisdictions referred to in Section
5(a)(vii), including the reasonable fees and disbursements of counsel for the Underwriters in
connection with such registration and qualification and the preparation, printing, distribution and
shipment of preliminary and supplementary Blue Sky memoranda, provided such fees and disbursements
do not exceed $10,000 in the aggregate; (iv) the furnishing (including costs of shipping and
mailing) to the Underwriters of copies of the Base Prospectus, the Prospectus and all amendments or
supplements to the Prospectus, any Issuer Free Writing Prospectus, and of the several documents
required by this Section to be so furnished, as may be reasonably requested for use in connection
with the offering and sale of the Shares by the Underwriters or by dealers to whom Shares may be
sold; (v) if applicable, the filing fees of FINRA in connection with its review of the terms of the
public offering and reasonable fees and disbursements of counsel for the Underwriters in connection
with such review, provided such filing fees and fees and disbursements do no exceed $10,000 in the
aggregate; (vi) inclusion of the Shares for listing on the Nasdaq Global Market; (vii) all transfer
taxes, if any, with respect to the sale and delivery of the Shares by the Company to the
Underwriters; (viii) the preparation, printing and distribution of one or more versions of the
Prospectus for distribution in Canada, often in the form of a Canadian “wrapper” (including
reasonable related fees and expenses of Canadian counsel to the Underwriters), if applicable,
provided such fees and disbursements do not exceed $5,000 in the aggregate; and (ix) all reasonable
travel expenses incurred by the Underwriters in connection with the offering of the Shares,
including, without limitation, the use of private aircraft, whether chartered, leased or owned by
the Company or an affiliate of the
23
Company. Subject to the provisions of Section 8, the
Underwriters agree to pay, whether or not
the transactions contemplated hereby are consummated or this Agreement is terminated, all
costs and expenses incident to the performance of the obligations of
the Underwriters under this Agreement not payable by the Company pursuant to the preceding sentence, including, without
limitation, the fees and disbursements of counsel for the Underwriters.
(c) The Company acknowledges and agrees that the Underwriters have acted and are acting solely
in the capacity of a principal in an arm’s length transaction between the Company, on the one hand,
and the Underwriters, on the other hand, with respect to the offering of Shares contemplated hereby
(including in connection with determining the terms of the offering) and not as a financial
advisor, agent or fiduciary to the Company or any other person. Additionally, the Company
acknowledges and agrees that the Underwriters have not and will not advise the Company or any other
person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The
Company has consulted with its own advisors concerning such matters and shall be responsible for
making its own independent investigation and appraisal of the transactions contemplated hereby, and
the Underwriters shall have no responsibility or liability to the Company or any other person with
respect thereto, whether arising prior to or after the date hereof. Any review by the Underwriters
of the Company, the transactions contemplated hereby or other matters relating to such transactions
have been and will be performed solely for the benefit of the Underwriters and shall not be on
behalf of the Company. The Company agrees that it will not claim that the Underwriters, or any one
of them, has rendered advisory services of any nature or respect, or owes a fiduciary duty to the
Company or any other person in connection with any such transaction or the process leading thereto.
The Company acknowledges that the Underwriters and their affiliates may be engaged in a broad
range of transactions that involve interests that differ from those of the Company.
(d) The Company represents and agrees that, unless it obtains the prior consent of the
Representative, and each of the Underwriters represents and agrees that, unless it obtains the
prior consent of the Company and the Representative, it has not made and will not make any offer
relating to the Shares that would constitute an “issuer free writing prospectus,” as defined in
Rule 433 of the Rules, or that would otherwise constitute a “free writing prospectus,” as defined
in Rule 405, required to be filed with the Commission. The Company has complied and will comply
with the requirements of Rule 433 under the Securities Act applicable to any Issuer Free Writing
Prospectus, including timely filing with the Commission where required, legending and record
keeping. The Company represents that it has satisfied and agrees that it will satisfy the
conditions set forth in Rule 433 of the Rules to avoid a requirement to file with the Commission
any Road Show.
6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act against any and all losses, claims, damages and liabilities, joint or
several (including any reasonable investigation, legal and other expenses incurred in connection
with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted,
if such settlement is effected with the written consent of the Company in accordance with Section
6(c) below), to which they, or any of them, may become subject under
24
the Securities Act, the
Exchange Act or other Federal or state law or regulation, at common law
or otherwise, insofar as such losses, claims, damages or liabilities arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, the Statutory Prospectus, the Prospectus, any Issuer Free Writing Prospectus or any
“issuer-information” filed or required to be filed pursuant to Rule 433(d) of the Rules, any
amendment thereof or supplement thereto, or in any Blue Sky application or other information or
other documents executed by the Company filed in any state or other jurisdiction to qualify any or
all of the Shares under the securities laws thereof (any such application, document or information
being hereinafter referred to as a “Blue Sky Application”) or arise out of or are based upon any
omission or alleged omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that such indemnity
shall not inure to the benefit of any Underwriter (or any person controlling such Underwriter) on
account of any losses, claims, damages or liabilities arising from the sale of the Shares to any
person by such Underwriter if such untrue statement or omission or alleged untrue statement or
omission was made in the Registration Statement, the Prospectus, the Statutory Prospectus, any
Issuer Free Writing Prospectus or such amendment or supplement thereto, or in any Blue Sky
Application in reliance upon and in conformity with the Underwriting Information. This indemnity
agreement will be in addition to any liability which the Company may otherwise have.
(b) Each Underwriter agrees to indemnify and hold harmless the Company and each person, if
any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, each director of the Company, and each officer of the Company who signs the
Registration Statement, against any losses, claims, damages or liabilities (including any
reasonable investigation, legal and other expenses incurred in connection with, and any amount paid
in settlement of, any action, suit or proceeding or any claim asserted, if such settlement is
effected with the written consent of the Representative in accordance with Section 6(c) below) to
which such party may become subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, the Statutory Prospectus or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with the Underwriting Information
(other than the information set forth in the section entitled “Notice to Investors”); provided,
however, that the obligation of each Underwriter to indemnify the Company (including any
controlling person, director or officer thereof) shall be limited to the net proceeds received by
the Company from such Underwriter.
(c) Any party that proposes to assert the right to be indemnified under this Section will,
promptly after receipt of notice of commencement of any action, suit or proceeding against such
party in respect of which a claim is to be made against an indemnifying party or parties under this
Section, notify each such indemnifying party of the commencement of such action, suit or
proceeding, enclosing a copy of all papers served. No indemnification provided for in
25
Section 6(a)
or 6(b) shall be available to any party who shall fail to give notice as provided in
this Section 6(c) if the party to whom notice was not given was unaware of the action, suit or
proceeding to which such notice would have related and was prejudiced
in a material manner by the failure to give such notice but the omission so to notify such indemnifying party of any such
action, suit or proceeding shall not relieve it from any liability that it may have to any
indemnified party for contribution or otherwise than under this Section. In case any such action,
suit or proceeding shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and the approval by the indemnified party of such counsel
(not to be unreasonably withheld or delayed), the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses, except as provided below and except for the
reasonable costs of investigation subsequently incurred by such indemnified party in connection
with the defense thereof. The indemnified party shall have the right to employ its counsel in any
such action, but the fees and expenses of such counsel shall be at the expense of such indemnified
party unless (i) the employment of counsel by such indemnified party has been authorized in writing
by the indemnifying parties, (ii) the indemnified party shall have been advised by counsel that
there may be one or more legal defenses available to it which are different from or in addition to
those available to the indemnifying party (in which case the indemnifying parties shall not have
the right to direct the defense of such action on behalf of the indemnified party) or (iii) the
indemnifying parties shall not have employed counsel to assume the defense of such action within a
reasonable time after notice of the commencement thereof, in each of which cases the fees and
expenses of counsel to the indemnified party shall be at the expense of the indemnifying parties.
An indemnifying party shall not be obligated under any settlement agreement relating to any
action, suit or proceeding under this Section 6 to which it has not consented in writing, which
consent shall not be unreasonably withheld or delayed.
7. Contribution. In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in Section 6(a) or 6(b) is due in
accordance with its terms but for any reason is unavailable to or insufficient to hold harmless an
indemnified party in respect to any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate losses, liabilities,
claims, damages and expenses (including any investigation, legal and other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding
or any claims asserted, but after deducting any contribution received by any person entitled
hereunder to contribution from any person who may be liable for contribution) incurred by such
indemnified party, as incurred, 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 Shares pursuant to this Agreement or, if such allocation is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the relative benefits
referred to above but also the relative fault of the Company on the one hand and the Underwriters
on the other hand in connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.
The Company and
26
the Underwriters agree that it would not be just and equitable if contribution
pursuant to this
Section 7 were determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which
does not take account of the equitable considerations referred to above. The aggregate amount of losses, liabilities,
claims, damages and expenses incurred by an indemnified party and referred to above shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission. Notwithstanding the
provisions of this Section 7, (i) no Underwriter (except as may be provided in the Agreement Among
Underwriters) shall be required to contribute any amount in excess of the amount by which the total
underwriting discounts and commissions received by such Underwriter with respect to the offering of
the Shares exceeds the amount of damages which such Underwriter has otherwise been required to pay
by reason of any such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act 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 within the meaning of the Section 15 of the Securities Act or Section
20 of the Exchange Act, shall have the same rights to contribution as the Company. Any party
entitled to contribution will, promptly after receipt of notice of commencement of any action, suit
or proceeding against such party in respect of which a claim for contribution may be made against
another party or parties under this Section 7, notify such party or parties from whom contribution
may be sought, but the omission so to notify such party or parties from whom contribution may be
sought shall not relieve the party or parties from whom contribution may be sought from any other
obligation it or they may have hereunder or otherwise than under this Section 7. No party shall be
liable for contribution with respect to any action, suit, proceeding or claim settled without its
written consent. Each Underwriter’s obligations to contribute pursuant to this Section 7 are
several in proportion to their respective underwriting commitments and not joint.
8. Termination.
(a) This Agreement may be terminated with respect to the Shares to be purchased on a Closing
Date by the Representative by notifying the Company at any time at or before a Closing Date in the
absolute discretion of the Representative if: (i) in the good faith judgment of the Representative
there has occurred any material adverse change in the U.S. securities markets or any event, act or
occurrence that has materially disrupted, or in the opinion of the Representative will in the
future materially disrupt, the securities markets or there shall be such a material adverse change
in general financial, political or economic conditions in the U.S. or the effect of international
conditions on the financial markets in the U.S. is such as to make it, in the judgment of the
Representative, inadvisable or impracticable to market the Shares or enforce contracts for the sale
of the Shares; (ii) there has occurred any outbreak or material escalation of hostilities or other
calamity or crisis the effect of which on the financial markets of the U.S. is such as to make it,
in the good faith judgment of the Representative, inadvisable or impracticable
27
to proceed with the
completion of or enforce contracts for the sale of and payment for the Shares;
(iii) trading in the Shares or any securities of the Company has been suspended or materially
limited by the Commission or trading generally on the New York Stock
Exchange, Inc., the American Stock Exchange, Inc. or the Nasdaq Global Market has been suspended or materially limited,
or minimum or maximum ranges for prices for securities shall have been fixed, or maximum ranges for
prices for securities have been required, by any of said exchanges or by such system or by order of
the Commission, FINRA, or any other governmental or regulatory authority; or (iv) a banking
moratorium has been declared by any state or Federal authority; or (v) in the judgment of the
Representative, there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any material adverse change in
the assets, properties, condition, financial or otherwise, or in the results of operations,
business affairs or business prospects of the Company and its subsidiaries considered as a whole,
whether or not arising in the ordinary course of business.
(b) If this Agreement is terminated pursuant to any of its provisions, the Company shall not
be under any liability to any Underwriter, and no Underwriter shall be under any liability to the
Company, except that (y) if this Agreement is terminated by the Representative or the Underwriters
because of any failure, refusal or inability on the part of the Company to comply with the terms or
to fulfill any of the conditions of this Agreement, the Company will reimburse the Underwriters for
all out-of-pocket expenses (including the reasonable fees and disbursements of their counsel)
incurred by them in connection with the proposed purchase and sale of the Shares or in
contemplation of performing their obligations hereunder and (z) no Underwriter who shall have
failed or refused to purchase the Shares agreed to be purchased by it under this Agreement, without
some reason sufficient hereunder to justify cancellation or termination of its obligations under
this Agreement, shall be relieved of liability to the Company or any other Underwriter for damages
occasioned by its failure or refusal.
9. Substitution of Underwriters. If any Underwriter shall default in its obligation
to purchase on any Closing Date the Shares agreed to be purchased hereunder on such Closing Date,
the Representative shall have the right, within 36 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other underwriters, to purchase such Shares on
the terms contained herein. If, however, the Representative shall not have completed such
arrangements within such 36-hour period, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties satisfactory to the
Underwriters to purchase such Shares on such terms. If, after giving effect to any arrangements
for the purchase of the Shares of a defaulting Underwriter or Underwriters by the Representative
and the Company as provided above, the aggregate number of Shares which remains unpurchased on such
Closing Date does not exceed one-eleventh of the aggregate number of all the Shares that all the
Underwriters are obligated to purchase on such date, then the Company shall have the right to
require each non-defaulting Underwriter to purchase the number of Shares which such Underwriter
agreed to purchase hereunder at such date and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Shares which such Underwriter
agreed to purchase hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default. In any such case, either the Representative or the
Company shall have the right to postpone the applicable Closing Date for a period of not more than
seven days in order to effect any necessary
28
changes and arrangements (including any necessary
amendments or supplements to the Registration Statement or Prospectus or any other documents), and
the Company agrees to file promptly any amendments to the Registration Statement or the Prospectus which in the opinion
of the Company and the Underwriters and their counsel may thereby be made necessary.
If, after giving effect to any arrangements for the purchase of the Shares of a defaulting
Underwriter or Underwriters by the Representative and the Company as provided above, the aggregate
number of such Shares which remains unpurchased exceeds 10% of the aggregate number of all the
Shares to be purchased at such date, then this Agreement, or with respect to a Closing Date which
occurs after the Firm Shares Closing Date, the obligations of the Underwriters to purchase and of
the Company, as the case may be, to sell the Option Shares to be purchased and sold on such date,
shall terminate, without liability on the part of any non-defaulting Underwriter to the Company,
and without liability on the part of the Company, except as provided in Sections 5(b), 6, 7 and 8.
The provisions of this Section 9 shall not in any way affect the liability of any defaulting
Underwriter to the Company or the nondefaulting Underwriters arising out of such default. The term
“Underwriter” as used in this Agreement shall include any person substituted under this Section 9
with like effect as if such person had originally been a party to this Agreement with respect to
such Shares
10. Miscellaneous. The respective agreements, representations, warranties,
indemnities and other statements of the Company and the several Underwriters, as set forth in this
Agreement or made by or on behalf of them pursuant to this Agreement, shall remain in full force
and effect, regardless of any investigation (or any statement as to the results thereof) made by or
on behalf of any Underwriter or the Company or the or any of their respective officers, directors
or controlling persons referred to in Sections 6 and 7 hereof, and shall survive delivery of and
payment for the Shares. In addition, the provisions of Sections 5(b), 6, 7 and 8 shall survive the
termination or cancellation of this Agreement.
This Agreement has been and is made for the benefit of the Underwriters, the Company and their
respective successors and assigns, and, to the extent expressed herein, for the benefit of persons
controlling any of the Underwriters, or the Company, and directors and officers of the Company, and
their respective successors and assigns, and no other person shall acquire or have any right under
or by virtue of this Agreement. The term “successors and assigns” shall not include any purchaser
of Shares from any Underwriter merely because of such purchase.
All notices and communications hereunder shall be in writing and mailed or delivered or by
telephone or telegraph if subsequently confirmed in writing, (a) if to the Representative, to
▇▇▇▇▇▇▇▇▇ & Company, Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: General Counsel;
with a copy to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (fax:
(▇▇▇) ▇▇▇-▇▇▇▇) Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, and (b) if to the Company, to MannKind Corporation,
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (fax: (▇▇▇) ▇▇▇-▇▇▇▇), Attention: ▇▇▇▇▇
▇▇▇▇▇▇▇; with a copy to ▇▇▇▇▇▇ Godward Kronish LLP, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(fax: (▇▇▇) ▇▇▇-▇▇▇▇) Attention: D. ▇▇▇▇▇▇▇ ▇▇▇▇.
29
This Agreement shall be governed by and construed in accordance with the laws of the State of
New York.
This Agreement may be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon the same
instrument.
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 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 Section headings herein are for the convenience of the parties only and shall not
affect the construction or interpretation of this Agreement.
[signature page follows]
30
Please confirm that the foregoing correctly sets forth the agreement among us.
| Very truly yours, MANNKIND CORPORATION |
||||
| By | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Title: | Corporate Vice President and Chief Financial 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.
| ▇▇▇▇▇▇▇▇▇ & COMPANY, INC. Acting severally on behalf of itself and as representative of the several Underwriters named in Schedule I annexed hereto. |
||||
| By | /s/ ▇▇▇▇ ▇▇▇▇▇ | |||
| Name: | ▇▇▇▇ ▇▇▇▇▇ | |||
| Title: | Managing Director | |||
31
SCHEDULE I
| Number of | ||||
| Firm Shares | ||||
| to Be | ||||
| Name | Purchased | |||
▇▇▇▇▇▇▇▇▇ & Company, Inc. |
5,000,000 | |||
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLC |
2,400,000 | |||
Total |
7,400,000 | |||
Sch I-1
SCHEDULE II
AFFILIATE PURCHASER
▇▇▇▇▇▇ ▇. ▇▇▇▇ (or an affiliated entity of ▇▇. ▇▇▇▇, including without limitation, the ▇▇▇▇▇▇ ▇.
▇▇▇▇ Living Trust)
Sch II-1
SCHEDULE III
Lock-up Signatories
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, M.D.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, M.D.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
Sch III-1
SCHEDULE IV
Issuer Free Writing Prospectuses
Free Writing Prospectus filed on August 4, 2009 (SEC File No. 333-145282)
Sch IV-1