UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported): March
26, 2015
Sucampo Pharmaceuticals, Inc. |
(Exact Name of Registrant as Specified in Charter) |
Delaware |
001-33609 |
30-0520478 |
(State or Other Juris-
diction of Incorporation) |
(Commission
File Number) |
(IRS Employer
Identification No.) |
4520 East-West Highway, 3rd Floor
Bethesda, Maryland |
20814 |
(Address of Principal Executive Offices) |
(Zip Code) |
Registrant’s telephone number, including
area code: (301) 961-3400
(Former Name or Former Address, if Changed Since Last Report) |
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e- |
| Item 1.01 | Entry into a Material Definitive Agreement |
On March 26, 2015, Sucampo Pharmaceuticals,
Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) by and among
the Company, Jefferies LLC and Leerink Partners LLC, as representatives of the several underwriters listed on Schedule A thereto
(the “Underwriters”), and the selling stockholders listed on Schedule B thereto (the “Selling Stockholders”),
relating to an underwritten public offering (the “Offering”) of 4,600,000 shares (which includes 600,000 shares subject
to the Underwriters’ option which has been exercised) of the Company’s Class A common stock, $0.01 par
value per share (the “Common Stock”), at a public offering price of $14.00 per share. All of the shares in the Offering
are being sold by the Selling Stockholders. The Company is not selling any shares in the Offering and will not receive any proceeds
from the Offering. The closing of the Offering is expected to occur on March 31, 2015, subject to the satisfaction of customary
conditions.
The Offering was made pursuant to a prospectus
supplement, dated March 26, 2015, to the prospectus, dated January 27, 2015, included in the Company’s registration statement
on Form S-3 (File No. 333-201566), which was filed with the Securities and Exchange Commission (the “SEC”) on January
16, 2015 and declared effective on January 27, 2015.
The Underwriting Agreement contains customary
representations, warranties and covenants of the parties and indemnification and contribution provisions under which the parties
have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act of 1933, as amended.
The foregoing description of the Underwriting
Agreement does not purport to be complete and is qualified in its entirety by reference to the Underwriting Agreement, a copy of
which is filed herewith as Exhibit 1.1 and is incorporated by reference herein. The Underwriting Agreement contains representations
and warranties and other statements which are not for the benefit of any party other than the parties to such agreement and is
not intended as a document for investors or the public generally to obtain factual information about the Company. Rather, investors
and the public should look to other disclosures contained in the Company’s filings with the SEC.
On March 26, 2015, the Company issued a
press release announcing the pricing of the shares to be sold pursuant to the Underwriting Agreement. A copy of the press release
is filed with this Current Report on Form 8-K and attached hereto as Exhibit 99.1.
| Item 9.01. | Financial Statements
and Exhibits. |
The following exhibits are included as part
of this Current Report on Form 8-K:
Exhibit No. |
|
Description |
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1.1 |
|
Underwriting Agreement, dated March 26, 2015, by and between
the Company, the Selling Stockholders, and Jefferies LLC and Leerink Partners LLC. |
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|
99.1 |
|
Press Release issued by the Company on March 26, 2015. |
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
SUCAMPO PHARMACEUTICALS, INC. |
|
|
|
Dated: March 28, 2015 |
By: |
/s/ Thomas J. Knapp |
|
|
Name: Thomas J. Knapp |
|
|
Title: |
EVP, Chief Legal Officer and |
|
|
|
Corporate Secretary |
Exhibit 1.1
Execution Version
4,000,000 of Shares
Sucampo Pharmaceuticals, Inc.
UNDERWRITING AGREEMENT
March 26, 2015
JEFFERIES LLC
LEERINK PARTNERS LLC
As Representatives of the several Underwriters
c/o JEFFERIES LLC
520 Madison Avenue
New York, New York 10022
c/o LEERINK PARTNERS LLC
299 Park Avenue, 21st Floor
New York, New York 10171
Ladies and Gentlemen:
Introductory. The stockholders of
Sucampo Pharmaceuticals, Inc., a Delaware corporation (the “Company”) named in Schedule B (collectively,
the “Selling Stockholders”) severally propose to sell to the Underwriters an aggregate of 4,000,000 shares of
the Company’s class A common stock, par value $0.01 per share (the “Shares”). The 4,000,000 Shares to
be sold by the Selling Stockholders are collectively called the “Firm Shares.” In addition, the Selling Stockholders
have severally granted to the Underwriters an option to purchase up to an additional 600,000 Shares, with each Selling Stockholder
selling up to the amount set forth opposite such Selling Stockholder’s name in Schedule B, all as provided in Section
2. The additional 600,000 Shares to be sold by the Selling Stockholders pursuant to such option are collectively called the “Optional
Shares.” The Firm Shares and, if and to the extent such option is exercised, the Optional Shares are collectively called
the “Offered Shares.” Jefferies LLC (“Jefferies”) and Leerink Partners LLC have agreed to
act as representatives of the several Underwriters (in such capacity, the “Representatives”) in connection with
the offering and sale of the Offered Shares. To the extent there are no additional underwriters listed on Schedule A, the
term “Representatives” as used herein shall mean you, as Underwriters, and the term “Underwriters” shall
mean either the singular or the plural, as the context requires.
The Company has prepared and filed with
the Securities and Exchange Commission (the “Commission”) a shelf registration statement on Form S-3, File
No. 333-201566, including a base prospectus (the “Base Prospectus”), to be used in connection with the
public offering and sale of the Offered Shares. Such registration statement, as amended, including the financial statements, exhibits
and schedules thereto, in the form in which it became effective under the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder (collectively, the “Securities Act”), including all documents incorporated
or deemed to be incorporated by reference therein and any information deemed to be a part thereof at the time of effectiveness
pursuant to Rule 430A or 430B under the Securities Act, is called the “Registration Statement.” Any registration
statement filed by the Company pursuant to Rule 462(b) under the Securities Act in connection with the offer and sale of the Offered
Shares is called the “Rule 462(b) Registration Statement,” and from and after the date and time of filing of
any such Rule 462(b) Registration Statement the term “Registration Statement” shall include the Rule 462(b) Registration
Statement. The preliminary prospectus supplement dated March 25, 2015 describing the Offered Shares and the offering thereof (the
“Preliminary Prospectus Supplement”), together with the Base Prospectus, is called the “Preliminary
Prospectus,” and the Preliminary Prospectus and any other prospectus supplement to the Base Prospectus in preliminary
form that describes the Offered Shares and the offering thereof and is used prior to the filing of the Prospectus (as defined below),
together with the Base Prospectus, is called a “preliminary prospectus.” As used herein, the term “Prospectus”
shall mean the final prospectus supplement to the Base Prospectus that describes the Offered Shares and the offering thereof (the
“Final Prospectus Supplement”), together with the Base Prospectus, in the form first used by the Underwriters
to confirm sales of the Offered Shares or in the form first made available to the Underwriters by the Company to meet requests
of purchasers pursuant to Rule 173 under the Securities Act. References herein to the Preliminary Prospectus, any preliminary prospectus
and the Prospectus shall refer to both the prospectus supplement and the Base Prospectus components of such prospectus. As used
herein, “Applicable Time” is 8:25 a.m. (New York City time) on March 26, 2015. As used herein, “free
writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, and “Time of Sale Prospectus”
means the Preliminary Prospectus, as amended or supplemented immediately prior to the Applicable Time, together with the free writing
prospectuses, if any, identified in Schedule C hereto. As used herein, “Road Show” means a “road
show” (as defined in Rule 433 under the Securities Act) relating to the offering of the Offered Shares contemplated hereby
that is a “written communication” (as defined in Rule 405 under the Securities Act).
All references in this Agreement to the
Registration Statement, the Preliminary Prospectus, any preliminary prospectus, the Base Prospectus and the Prospectus shall include
the documents incorporated or deemed to be incorporated by reference therein. All references in this Agreement to financial statements
and schedules and other information which are “contained,” “included” or “stated” in, or “part
of” the Registration Statement, the Rule 462(b) Registration Statement, the Preliminary Prospectus, any preliminary prospectus,
the Base Prospectus, the Time of Sale Prospectus or the Prospectus, and all other references of like import, shall be deemed to
mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated by
reference in the Registration Statement, the Rule 462(b) Registration Statement, the Preliminary Prospectus, any preliminary prospectus,
the Base Prospectus, the Time of Sale Prospectus or the Prospectus, as the case may be. All references in this Agreement to amendments
or supplements to the Registration Statement, the Preliminary Prospectus, any preliminary prospectus, the Base Prospectus, the
Time of Sale Prospectus or the Prospectus shall be deemed to mean and include the filing of any document under the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Exchange Act”)
that is or is deemed to be incorporated by reference in the Registration Statement, the Preliminary Prospectus, any preliminary
prospectus, the Base Prospectus, or the Prospectus, as the case may be. All references in this Agreement to (i) the Registration
Statement, the Preliminary Prospectus, any preliminary prospectus, the Base Prospectus or the Prospectus, any amendments or supplements
to any of the foregoing, or any free writing prospectus, shall include any copy thereof filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”) and (ii) the Prospectus shall be deemed to
include any “electronic Prospectus” provided for use in connection with the offering of the Offered Shares as contemplated
by Section 3A(n) of this Agreement.
The Company and each of the Selling Stockholders
hereby confirm their respective agreements with the Underwriters as follows:
Section 1.
Representations and Warranties.
A.
Representations and Warranties of the Company. The Company hereby represents, warrants and covenants to each
Underwriter, as of the date of this Agreement, as of the First Closing Date (as hereinafter defined) and as of each Option Closing
Date (as hereinafter defined), if any, as follows:
(a)
Compliance with Registration Requirements. The Registration Statement has become effective under
the Securities Act. The Company has complied, to the Commission’s satisfaction, with all requests of the Commission for additional
or supplemental information, if any. No stop order suspending the effectiveness of the Registration Statement is in effect and
no proceedings for such purpose have been instituted or are pending or, to the knowledge of the Company, are contemplated or threatened
by the Commission. At the time the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (the “Annual
Report”) was filed with the Commission, or, if later, at the time the Registration Statement was originally filed with
the Commission, the Company met the then-applicable requirements for use of Form S-3 under the Securities Act. The Company meets
the requirements for use of Form S-3 under the Securities Act specified in the Financial Industry Regulatory Authority, Inc. (“FINRA”)
Conduct Rule 5110(b)(7)(C)(i). The documents incorporated or deemed to be incorporated by reference in the Registration Statement,
the Time of Sale Prospectus and the Prospectus, at the time they were or hereafter are filed with the Commission, or became effective
under the Exchange Act, as the case may be, complied and will comply in all material respects with the requirements of the Exchange
Act.
(b)
Disclosure. Each preliminary prospectus and the Prospectus when filed complied in all material
respects with the Securities Act and, if filed by electronic transmission pursuant to EDGAR, was identical (except as may be permitted
by Regulation S-T under the Securities Act) to the copy thereof delivered to the Underwriters for use in connection with the
offer and sale of the Offered Shares. Each of the Registration Statement and any post-effective amendment thereto, at the time
it became or becomes effective, complied and will comply in all material respects with the Securities Act and did not and will
not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading. As of the Applicable Time, the Time of Sale Prospectus (including any preliminary
prospectus wrapper) did not, and at the First Closing Date (as defined in Section 2)
and at each applicable Option Closing Date (as defined in Section 2), will not, contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were
made, not misleading. The Prospectus (including any Prospectus wrapper), as of its date, did not, and at the First Closing Date
and at each applicable Option Closing Date, will not, contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The representations and warranties set forth in the three immediately preceding sentences do not apply to statements in or omissions
from the Registration Statement or any post-effective amendment thereto, or the Prospectus or the Time of Sale Prospectus, or any
amendments or supplements thereto, made in reliance upon and in conformity with written information relating to any Underwriter
furnished to the Company in writing by the Representatives expressly for use therein, it being understood and agreed that the only
such information consists of the information described in Section 9(b) below. There are
no contracts or other documents required to be described in the Time of Sale Prospectus or the Prospectus or to be filed as an
exhibit to the Registration Statement which have not been described or filed as required.
(c)
Free Writing Prospectuses; Road Show. As of the determination date referenced in Rule 164(h) under
the Securities Act, the Company was not, is not or will not be (as applicable) an “ineligible issuer” in connection
with the offering of the Offered Shares pursuant to Rules 164, 405 and 433 under the Securities Act. Each free writing prospectus
that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission
in accordance with the requirements of the Securities Act. Each free writing prospectus that the Company has filed, or is required
to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the
Company complies or will comply in all material respects with the requirements of Rule 433 under the Securities Act, including
timely filing with the Commission or retention where required and legending, and each such free writing prospectus, as of its issue
date and at all subsequent times through the completion of the public offer and sale of the Offered Shares did not, does not and
will not include any information that conflicted, conflicts or will conflict with the information contained in the Registration
Statement, the Prospectus or any preliminary prospectus and not superseded or modified. Except for the free writing prospectuses,
if any, identified in Schedule C, and electronic road shows, if any, furnished to you before first use, the Company has
not prepared, used or referred to, and will not, without your prior written consent, prepare, use or refer to, any free writing
prospectus. Each Road Show, when considered together with the Time of Sale Prospectus, did not, as of the Applicable Time, contain
any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
(d)
Distribution of Offering Material By the Company. Prior to the later of (i) the expiration or termination
of the option granted to the several Underwriters in Section 2 and (ii) the completion
of the Underwriters’ distribution of the Offered Shares, the Company has not distributed and will not distribute any
offering material in connection with the offering and sale of the Offered Shares other than the Registration Statement, the Time
of Sale Prospectus, the Prospectus or any free writing prospectus reviewed and consented to by the Representatives, the free writing
prospectuses, if any, identified on Schedule C hereto.
(e)
The Underwriting Agreement. This Agreement has been duly authorized, executed and delivered by
the Company.
(f)
Authorization of the Offered Shares. The Offered Shares have been duly authorized and validly issued
and are fully paid and nonassessable, and the sale of the Offered Shares is not subject to any preemptive rights, rights of first
refusal or other similar rights to subscribe for or purchase the Offered Shares pursuant to the Company’s charter, by-laws
or other organizational documents, or any contract or agreement to which the Company is a party.
(g)
No Applicable Registration or Other Similar Rights. There are no persons with registration or other
similar rights to have any equity or debt securities registered for sale under the Registration Statement or included in the offering
contemplated by this Agreement, except for such rights as are disclosed in the Registration Statement, the Time of Sale Prospectus
and the Prospectus and as have been duly waived.
(h)
No Material Adverse Change. Except as otherwise disclosed in the Registration Statement, the Time
of Sale Prospectus and the Prospectus, subsequent to the respective dates as of which information is given in the Registration
Statement, the Time of Sale Prospectus and the Prospectus: (i) there has been no material adverse change, or any development
that would reasonably be expected to result in a material adverse change, in the condition, financial or otherwise, or in the earnings,
business, properties, operations, assets, liabilities or prospects, whether or not arising from transactions in the ordinary course
of business, of the Company and its subsidiaries, considered as one entity (any such change being referred to herein as a “Material
Adverse Change”); (ii) the Company and its subsidiaries, considered as one entity, have not incurred any material
liability or obligation, indirect, direct or contingent, including without limitation any losses or interference with its business
from fire, explosion, flood, earthquakes, accident or other calamity, whether or not covered by insurance, or from any strike,
labor dispute or court or governmental action, order or decree, that are material, individually or in the aggregate, to the Company
and its subsidiaries, considered as one entity, or has entered into any material transactions not in the ordinary course of business;
and (iii) there has not been any material decrease in the capital stock or any material increase in any short-term or long-term
indebtedness of the Company or its subsidiaries and there has been no dividend or distribution of any kind declared, paid or made
by the Company or, except for dividends paid to the Company or other subsidiaries, by any of the Company’s subsidiaries on
any class of capital stock, or any repurchase or redemption by the Company or any of its subsidiaries of any class of capital stock.
(i)
Independent Accountants. PricewaterhouseCoopers LLP, which has expressed its opinion with respect
to the financial statements (which term as used in this Agreement includes the related notes thereto) filed with the Commission
as a part of the Registration Statement, the Time of Sale Prospectus and the Prospectus, is (i) an independent registered public
accounting firm as required by the Exchange Act and the rules of the Public Company Accounting Oversight Board (“PCAOB”),
(ii) in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation
S-X under the Securities Act and (iii) a registered public accounting firm as defined by the PCAOB whose registration has not been
suspended or revoked and who has not requested such registration to be withdrawn.
(j)
Financial Statements. The financial statements filed with the Commission as a part of the Registration
Statement, the Time of Sale Prospectus and the Prospectus present fairly, in all material respects, the consolidated financial
position of the Company and its subsidiaries as of the dates indicated and the results of their operations, changes in stockholders’
equity and cash flows for the periods specified. Such financial statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods involved, except as may be expressly stated in the related
notes thereto. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration
Statement present fairly, in all material respects, the information called for, in all material respects, and has been prepared
materially in accordance with the Commission’s rules and guidelines applicable thereto. No other financial statements or
supporting schedules are required to be included in the Registration Statement, the Time of Sale Prospectus or the Prospectus.
The financial data set forth or incorporated by reference in each of the Registration Statement, the Time of Sale Prospectus and
the Prospectus under the caption “Prospectus Supplement Summary—Summary Selected Financial Information” fairly
present the information set forth therein on a basis consistent with that of the audited financial statements contained in the
Registration Statement, the Time of Sale Prospectus and the Prospectus. All disclosures contained in the Registration Statement,
any preliminary prospectus, the Prospectus and any free writing prospectus that constitute non-GAAP financial measures (as defined
by the rules and regulations under the Securities Act and the Exchange Act) comply with Regulation G under the Exchange Act and
Item 10 of Regulation S-K under the Securities Act, as applicable. To the Company’s knowledge, no person who has
been suspended or barred from being associated with a registered public accounting firm, or who has failed to comply with any sanction
pursuant to Rule 5300 promulgated by the PCAOB, has participated in or otherwise aided the preparation of, or audited, the financial
statements, supporting schedules or other financial data filed with the Commission as a part of the Registration Statement, the
Time of Sale Prospectus and the Prospectus.
(k)
Company’s Accounting System. The Company and each of its subsidiaries make and keep books
and records that are accurate in all material respects and maintain a system of internal accounting controls sufficient to provide
reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorization;
(ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with
management’s general or specific authorization; (iv) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in
eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement, the Time of Sale Prospectus
and the Prospectus fairly presents, in all material respects, the information called for and is prepared, in all material respects,
in accordance with the Commission's rules and guidelines applicable thereto.
(l)
Disclosure Controls and Procedures; Deficiencies in or Changes to Internal Control Over Financial Reporting.
The Company has established and maintains disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 under
the Exchange Act), which (i) are designed to ensure that material information relating to the Company, including its consolidated
subsidiaries, is made known to the Company’s principal executive officer and its principal financial officer by others within
those entities, particularly during the periods in which the periodic reports required under the Exchange Act are being prepared;
(ii) have been evaluated by management of the Company for effectiveness as of the end of the Company’s most recent fiscal
quarter; and (iii) are effective in all material respects to perform the functions for which they were established. Since the end
of the Company’s most recent audited fiscal year, there have been no significant deficiencies or material weakness in the
Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) (whether or
not remediated) and no change in the Company’s internal control over financial reporting that has materially affected, or
is reasonably likely to materially affect, the Company’s internal control over financial reporting. The Company is not aware
of any change in its internal control over financial reporting that has occurred during its most recent fiscal quarter that has
materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
(m)
Incorporation and Good Standing of the Company. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the jurisdiction of its incorporation and has the corporate power
and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement,
the Time of Sale Prospectus and the Prospectus and to enter into and perform its obligations under this Agreement. The Company
is duly qualified as a foreign corporation to transact business and is in good standing in the State of Maryland and each other
jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure to so qualify would not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect (as defined below).
(n)
Subsidiaries. Each of the Company’s “subsidiaries” (for purposes of this Agreement,
as defined in Rule 405 under the Securities Act) has been duly incorporated or organized, as the case may be, and is validly existing
as a corporation, partnership or limited liability company, as applicable, in good standing under the laws of the jurisdiction
of its incorporation or organization except where the failure to be in good standing would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect (as defined below), and has the power and authority (corporate or other)
to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the Time of Sale
Prospectus and the Prospectus. Each of the Company’s subsidiaries is duly qualified as a foreign corporation, partnership
or limited liability company, as applicable, to transact business and is in good standing in each jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of property or the conduct of business except where the failure to so
qualify would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect (as defined below).
All of the issued and outstanding capital stock or other equity or ownership interests of each of the Company’s subsidiaries
have been duly authorized and validly issued, are fully paid and nonassessable and are owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance or adverse claim. The Company does not
own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed in Exhibit 21
to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014.
(o)
Capitalization and Other Capital Stock Matters. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Registration Statement, the Time of Sale Prospectus and the Prospectus under the caption
“Capitalization” (other than for subsequent issuances, if any, pursuant to employee benefit plans, or upon the exercise
of outstanding options or warrants, in each case described in the Registration Statement, the Time of Sale Prospectus and the Prospectus).
The Shares (including the Offered Shares) conform in all material respects to the description thereof contained in the Time of
Sale Prospectus. All of the issued and outstanding Shares (including the Shares owned by Selling Stockholders) have been duly authorized
and validly issued, are fully paid and nonassessable and have been issued in compliance with all federal and state securities laws.
None of the outstanding Shares was issued in violation of any preemptive rights, rights of first refusal or other similar rights
to subscribe for or purchase securities of the Company. There are no authorized or outstanding options, warrants, preemptive rights,
rights of first refusal or other rights to purchase, or equity or debt securities convertible into or exchangeable or exercisable
for, any capital stock of the Company or any of its subsidiaries other than those described in the Registration Statement, the
Time of Sale Prospectus and the Prospectus. The descriptions of the Company’s stock option, stock bonus and other stock plans
or arrangements, and the options or other rights granted thereunder, set forth in the Registration Statement, the Time of Sale
Prospectus and the Prospectus accurately and fairly presents, in all material respects, the information required to be shown with
respect to such plans, arrangements, options and rights.
(p)
Stock Exchange Listing. The Shares are registered pursuant to Section 12(b) or 12(g) of the Exchange
Act and are listed on The NASDAQ Global Market (the “NASDAQ”), and the Company has taken no action designed
to, or likely to have the effect of, terminating the registration of the Shares under the Exchange Act or delisting the Shares
from the NASDAQ, nor has the Company received any notification that the Commission or the NASDAQ is contemplating terminating such
registration or listing. To the Company’s knowledge, it is in compliance with all applicable listing requirements of NASDAQ.
(q)
Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required. Neither
the Company nor any of its subsidiaries is in violation of its charter or by-laws, partnership agreement or operating agreement
or similar organizational documents, as applicable, or is in default (or, with the giving of notice or lapse of time, would be
in default) (“Default”) under any indenture, loan, credit agreement, note, lease, license agreement, contract,
franchise or other instrument (including, without limitation, any pledge agreement, security agreement, mortgage or other instrument
or agreement evidencing, guaranteeing, securing or relating to indebtedness) to which the Company or any of its subsidiaries is
a party or by which it or any of them may be bound, or to which any of their respective properties or assets are subject (each,
an “Existing Instrument”), except for such Defaults as would not, individually or in the aggregate, reasonably
be expected to have a material adverse effect on the condition (financial or other), earnings, business, properties, operations,
assets, liabilities or prospects of the Company and its subsidiaries, considered as one entity (a “Material Adverse Effect”).
The Company’s execution, delivery and performance of this Agreement, consummation of the transactions contemplated hereby
and by the Registration Statement, the Time of Sale Prospectus and the Prospectus and the issuance and sale of the Offered Shares
(including the use of proceeds from the sale of the Offered Shares as described in the Registration Statement, the Time of Sale
Prospectus and the Prospectus under the caption “Use of Proceeds”) (i) have been duly authorized by all necessary
corporate action and will not result in any violation of the provisions of the charter or by-laws, partnership agreement or operating
agreement or similar organizational documents, as applicable, of the Company or any subsidiary (ii) will not conflict with
or constitute a breach of, or Default or a Debt Repayment Triggering Event (as defined below) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant
to, or require the consent of any other party to, any Existing Instrument, except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect and (iii) will not result in any violation of any law, administrative
regulation or administrative or court decree applicable to the Company or any of its subsidiaries. No consent, approval, authorization
or other order of, or registration or filing with, any court or other governmental or regulatory authority or agency, is required
for the Company’s execution, delivery and performance of this Agreement and consummation of the transactions contemplated
hereby and by the Registration Statement, the Time of Sale Prospectus and the Prospectus, except such as have been obtained or
made by the Company and are in full force and effect under the Securities Act and such as may be required under applicable state
securities or blue sky laws or FINRA. As used herein, a “Debt Repayment Triggering Event” means any event or
condition which gives, or with the giving of notice or lapse of time would give, the holder of any note, debenture or other evidence
of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment
of all or a portion of such indebtedness by the Company or any of its subsidiaries.
(r)
Compliance with Laws. The Company and its subsidiaries have been and are in compliance with all
applicable laws, rules and regulations, except where failure to be so in compliance would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(s)
No Material Actions or Proceedings. There is no action, suit, proceeding, inquiry or investigation
brought by or before any governmental entity now pending or, to the knowledge of the Company, threatened, against or affecting
the Company or any of its subsidiaries, which would , individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect or materially and adversely affect the consummation of the transactions contemplated by this Agreement or the performance
by the Company of its obligations hereunder. No labor dispute with the employees of the Company or any of its subsidiaries, or
with the employees of any principal supplier, manufacturer, customer or contractor of the Company, exists or, to the knowledge
of the Company, is threatened or imminent, except as could not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect.
(t)
Intellectual Property Rights. Except as described in the Registration Statement, the Time of Sale
Prospectus and the Prospectus, the Company and its subsidiaries own, or have obtained valid and enforceable licenses for, the inventions,
patent applications, patents, trademarks, trade names, service names, copyrights, trade secrets and other intellectual property
described in the Registration Statement, the Time of Sale Prospectus and the Prospectus as being owned or licensed by them or which
are reasonably necessary for the conduct of their respective businesses as currently conducted or, to the extent described in the
Registration Statement, the Time of Sale Prospectus and the Prospectus, as currently proposed to be conducted (collectively, “Intellectual
Property”). To the Company's knowledge: (i) there are no third parties who have rights to any Intellectual Property,
except for customary reversionary rights of third-party licensors with respect to Intellectual Property that are disclosed in the
Registration Statement, the Time of Sale Prospectus and the Prospectus as licensed to the Company or one or more of its subsidiaries;
and (ii) except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, to the Company’s
knowledge there is no infringement by third parties of any Intellectual Property. Except as disclosed in the Registration Statement,
the Time of Sale Prospectus and the Prospectus and as would not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect, there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim
by others: (A) challenging the Company’s rights in or to any Intellectual Property, and the Company is unaware of any facts
which would form a reasonable basis for any such action, suit, proceeding or claim; (B) challenging the validity, enforceability
or scope of any Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such
action, suit, proceeding or claim; or (C) asserting that the Company or any of its subsidiaries infringes or otherwise violates,
or would, upon the commercialization of any product or service described in the Registration Statement, the Time of Sale Prospectus
or the Prospectus as under development, infringe or violate, any patent, trademark, trade name, service name, copyright, trade
secret or other proprietary rights of others, and the Company is unaware of any facts which would form a reasonable basis for any
such action, suit, proceeding or claim. The Company and its subsidiaries have complied in all material respects with the terms
of each agreement pursuant to which Intellectual Property has been licensed to the Company or any subsidiary, and all such agreements
are in full force and effect. The product candidates described in the Registration Statement, the Time of Sale Prospectus and the
Prospectus as under development by the Company or any subsidiary fall within the scope of the claims of one or more patents owned
by, or exclusively licensed to, the Company or any subsidiary.
(u)
All Necessary Permits, etc. The Company and its subsidiaries possess such valid and current certificates,
authorizations or permits required by state, federal or foreign regulatory agencies or bodies to conduct their respective businesses
as currently conducted and as described in the Registration Statement, the Time of Sale Prospectus or the Prospectus (“Permits”),
except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.. Neither the Company
nor any of its subsidiaries is in violation of, or in default under, any of the Permits or has received any notice of proceedings
relating to the revocation or modification of, or non-compliance with, any such certificate, authorization or permit, except as
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(v)
Title to Properties. The Company and its subsidiaries have good and marketable title to all of
the real and personal property and other assets reflected as owned in the financial statements referred to in Section 1A(j) above
(or elsewhere in the Registration Statement, the Time of Sale Prospectus or the Prospectus), in each case free and clear of any
security interests, mortgages, liens, encumbrances, equities, adverse claims and other defects except as would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect. The real property, improvements, equipment and personal
property held under lease by the Company or any of its subsidiaries are held under valid and enforceable leases, with such exceptions
as are not material and do not materially interfere with the use made or proposed to be made of such real property, improvements,
equipment or personal property by the Company or such subsidiary.
(w)
Tax Law Compliance. The Company and its subsidiaries have filed all necessary federal, state and
foreign income and franchise tax returns or have properly requested extensions thereof and have paid all taxes required to be paid
by any of them and, if due and payable, any related or similar assessment, fine or penalty levied against any of them except as
may be being contested in good faith and by appropriate proceedings and, with respect to any states in which the Company is not
qualified to do business, except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. The Company has made adequate charges, accruals and reserves in the applicable financial statements referred to in Section
1A(j) above in respect of all federal, state and foreign income and franchise taxes for all periods as to which the tax liability
of the Company or any of its subsidiaries has not been finally determined.
(x)
Insurance. Each of the Company and its subsidiaries are insured by recognized, financially sound
and reputable institutions with policies in such amounts and with such deductibles and covering such risks as are generally deemed
adequate and customary for their businesses including, but not limited to, policies covering real and personal property owned or
leased by the Company and its subsidiaries against theft, damage, destruction, acts of vandalism and earthquakes and policies covering
the Company and its subsidiaries for product liability claims and clinical trial liability claims. The Company has no reason to
believe that it or any of its subsidiaries will not be able (i) to renew its existing insurance coverage as and when such policies
expire or (ii) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business
as now conducted and at a cost that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. Neither the Company nor any of its subsidiaries has been denied any insurance coverage which it has sought or for which
it has applied.
(y)
Compliance with Environmental Laws. Except as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect: (i) neither the Company nor any of its subsidiaries is in violation of any federal,
state, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order, consent, decree or judgment, relating to pollution or protection
of human health, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface
strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum or petroleum products (collectively, “Hazardous
Materials”) or to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling
of Hazardous Materials (collectively, “Environmental Laws”); (ii) the Company and its subsidiaries have all
permits, authorizations and approvals required under any applicable Environmental Laws and are each in compliance with their requirements;
and (iii) there are no pending or, to the Company’s knowledge, threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigation or proceedings relating to
any Environmental Law against the Company or any of its subsidiaries.
(z)
ERISA Compliance. The Company and its subsidiaries and any “employee benefit plan”
(as defined under the Employee Retirement Income Security Act of 1974, as amended, and the regulations and published interpretations
thereunder (collectively, “ERISA”)) established or maintained by the Company, its subsidiaries or their “ERISA
Affiliates” (as defined below) are in compliance in all material respects with ERISA. “ERISA Affiliate”
means, with respect to the Company or any of its subsidiaries, any member of any group of organizations described in Sections 414(b),
(c), (m) or (o) of the Internal Revenue Code of 1986, as amended, and the regulations and published interpretations thereunder
(the “Code”) of which the Company or such subsidiary is a member. No “reportable event” (as defined
under ERISA) has occurred or is reasonably expected to occur with respect to any “employee benefit plan” established
or maintained by the Company, its subsidiaries or any of their ERISA Affiliates. No “employee benefit plan” established
or maintained by the Company, its subsidiaries or any of their ERISA Affiliates, if such “employee benefit plan” were
terminated, would have any “amount of unfunded benefit liabilities” (as defined under ERISA). Neither the Company,
its subsidiaries nor any of their ERISA Affiliates has incurred or reasonably expects to incur any liability under (i) Title IV
of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections 412,
4971, 4975 or 4980B of the Code. Each employee benefit plan established or maintained by the Company, its subsidiaries or any of
their ERISA Affiliates that is intended to be qualified under Section 401(a) of the Code is so qualified and nothing has occurred,
whether by action or failure to act, which would cause the loss of such qualification.
(aa)
Company Not an “Investment Company.” The Company is not, and will not be, either after
receipt of payment for the Offered Shares or after the application of the proceeds therefrom as described under “Use of Proceeds”
in the Registration Statement, the Time of Sale Prospectus or the Prospectus, required to register as an “investment company”
under the Investment Company Act of 1940, as amended (the “Investment Company Act”).
(bb)
No Price Stabilization or Manipulation; Compliance with Regulation M. Neither the Company nor any
of its subsidiaries or affiliates has taken, directly or indirectly, any action designed to or that might cause or result in stabilization
or manipulation of the price of the Shares or of any “reference security” (as defined in Rule 100 of Regulation M under
the Exchange Act (“Regulation M”)) with respect to the Shares, whether to facilitate the sale or resale of the
Offered Shares or otherwise, and has taken no action which would directly or indirectly violate Regulation M.
(cc)
Related-Party Transactions. There are no business relationships or related-party transactions involving
the Company or any of its subsidiaries or any other person required to be described in the Registration Statement, the Time of
Sale Prospectus or the Prospectus that have not been described as required.
(dd)
FINRA Matters. All of the information provided to the Underwriters or to counsel for the Underwriters
by the Company, its counsel, its officers and directors and the holders of any securities (debt or equity) or options to acquire
any securities of the Company in connection with the offering of the Offered Shares is true, complete, correct and compliant with
FINRA’s rules and any letters, filings or other supplemental information provided to FINRA pursuant to FINRA Rules or NASD
Conduct Rules is true, complete and correct.
(ee)
Parties to Lock-Up Agreements. The Company has furnished to the Underwriters a letter agreement
in the form attached hereto as Exhibit C (the “Lock-up Agreement”) from the Selling Stockholders
and each of the persons listed on Exhibit D. Such Exhibit D lists under an appropriate caption the directors
and executive officers of the Company. If any additional persons shall become directors or executive officers of the Company prior
to the end of the Company Lock-up Period (as defined below), the Company shall cause each such person, prior to or contemporaneously
with their appointment or election as a director or executive officer of the Company, to execute and deliver to the Representatives
a Lock-up Agreement.
(ff)
Statistical and Market-Related Data. All statistical, demographic and market-related data included
in the Registration Statement, the Time of Sale Prospectus or the Prospectus are based on or derived from sources that the Company
believes, after reasonable inquiry, to be reliable and accurate. To the extent required, the Company has obtained the written consent
to the use of such data from such sources.
(gg)
No Unlawful Contributions or Other Payments. Neither the Company nor any of its subsidiaries or
affiliates nor, to the best of the Company’s knowledge, any employee or agent of the Company or any subsidiary or affiliate,
has made any contribution or other payment to any official of, or candidate for, any federal, state or foreign office in violation
of any law or of the character required to be disclosed in the Registration Statement, the Time of Sale Prospectus or the Prospectus.
(hh)
Foreign Corrupt Practices Act. Neither the Company nor any of its subsidiaries nor, to the knowledge
of the Company, any director, officer, agent, employee, affiliate or other person acting on behalf of the Company or any of its
subsidiaries has, in the course of its actions for, or on behalf of, the Company or any of its subsidiaries (i) used any corporate
funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any
direct or indirect unlawful payment to any domestic government official, “foreign official” (as defined in the U.S.
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (collectively, the “FCPA”)
or employee from corporate funds; (iii) violated or is in violation of any provision of the FCPA or any applicable non-U.S.
anti-bribery statute or regulation; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any domestic government official, such foreign official or employee; and the Company and its subsidiaries and,
to the knowledge of the Company, the Company’s affiliates have conducted their respective businesses in compliance with the
FCPA and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue
to ensure, continued compliance therewith.
(ii)
Money Laundering Laws. The operations of the Company and its subsidiaries are, and have been conducted
at all times, in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder
and any related or similar applicable rules, regulations or guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering
Laws is pending or, to the knowledge of the Company, threatened.
(jj)
OFAC. Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, after
due inquiry, any director, officer, 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”).
(kk)
Brokers. Except pursuant to this Agreement, there is no broker, finder or other party that is entitled
to receive from the Company any brokerage or finder’s fee or other fee or commission as a result of any transactions contemplated
by this Agreement.
(ll)
Forward-Looking Statements. Each financial or operational projection or other “forward-looking
statement” (as defined by Section 27A of the Securities Act or Section 21E of the Exchange Act) contained in the Registration
Statement, the Time of Sale Prospectus or the Prospectus (i) was so included by the Company in good faith and with reasonable
basis after due consideration by the Company of the underlying assumptions, estimates and other applicable facts and circumstances
and (ii) is accompanied by meaningful cautionary statements identifying those factors that could cause actual results to differ
materially from those in such forward-looking statement. No such statement was made with the knowledge of an executive officer
or director of the Company that it was false or misleading.
(mm) No Contract Terminations.
Neither the Company nor any of its subsidiaries has sent or received any communication regarding termination of, or intent not
to renew, any of the contracts or agreements referred to or described in any preliminary prospectus, the Prospectus or any free
writing prospectus, or referred to or described in, or filed as an exhibit to, the Registration Statement, or any document incorporated
by reference therein, and no such termination or non-renewal has been threatened by the Company or any of its subsidiaries or,
to the Company’s knowledge, any other party to any such contract or agreement, which threat of termination or non-renewal
has not been rescinded as of the date hereof.
(nn) Clinical Data and Regulatory
Compliance. The preclinical tests and clinical trials, and other studies (collectively, “studies”) that are
described in, or the results of which are referred to in, the Registration Statement, the Time of Sale Prospectus or the Prospectus
were and, if still pending, are being conducted in all material respects in accordance with the protocols, procedures and controls
designed and approved for such studies and with standard medical and scientific research procedures; each description of the results
of such studies is accurate and complete in all material respects and fairly presents the data derived from such studies, and the
Company and its subsidiaries have no knowledge of any other studies the results of which are materially inconsistent with, or otherwise
call into question, the results described or referred to in the Registration Statement, the Time of Sale Prospectuses or the Prospectus;
the Company and its subsidiaries have made all such filings and obtained all such approvals as may be required by the Food and
Drug Administration of the U.S. Department of Health and Human Services or any committee thereof or from any other U.S. or foreign
government or drug or medical device regulatory agency, or health care facility Institutional Review Board (collectively, the “Regulatory
Agencies”); neither the Company nor any of its subsidiaries has received any notice of, or correspondence from, any Regulatory
Agency requiring the termination, suspension or modification of any clinical trials that are described or referred to in the Registration
Statement, the Time of Sale Prospectus or the Prospectus; and the Company and its subsidiaries have each operated and currently
are in compliance in all material respects with all applicable rules, regulations and policies of the Regulatory Agencies.
Any certificate signed by any officer of
the Company or any of its subsidiaries and delivered to any Underwriter or to counsel for the Underwriters in connection with the
offering, or the purchase and sale, of the Offered Shares shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
The Company acknowledges that the Underwriters
and, for purposes of the opinions to be delivered pursuant to Section 6 hereof, counsel
to the Company and counsel to the Underwriters, will rely upon the accuracy and truthfulness of the foregoing representations and
hereby consents to such reliance.
B.
Representations and Warranties of the Selling Stockholders. In addition to the representations, warranties and covenants
set forth in Section 1A, each Selling Stockholder represents, warrants and covenants
to each Underwriter, severally and not jointly, as follows:
(a)
The Underwriting Agreement. This Agreement has been duly authorized, executed and delivered by
or on behalf of such Selling Stockholder.
(b)
The Custody Agreement and Power of Attorney. Each of (i) the Custody Agreement signed by such
Selling Stockholder and American Stock Transfer & Trust Company LLC, as custodian (the “Custodian”), relating
to the deposit of the Offered Shares to be sold by such Selling Stockholder (the “Custody Agreement”) and (ii) the
Power of Attorney appointing certain individuals named therein as such Selling Stockholder’s attorneys-in-fact (each, an
“Attorney-in-Fact”) to the extent set forth therein relating to the transactions contemplated hereby and by
the Prospectus (the “Power of Attorney”), of such Selling Stockholder has been duly authorized, executed and
delivered by such Selling Stockholder and is a valid and binding agreement of such Selling Stockholder, enforceable in accordance
with its terms, except as rights to indemnification thereunder may be limited by applicable law and except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights
and remedies of creditors or by general equitable principles.
(c)
Title to Offered Shares to be Sold. Such Selling Stockholder has, and on the First Closing Date
and each applicable Option Closing Date (as defined below) will have, good and valid title to all of the Offered Shares subject
to sale by such Selling Stockholder pursuant to this Agreement on such date and the legal right and power to sell, transfer and
deliver all of the Offered Shares which may be sold by such Selling Stockholder pursuant to this Agreement and to comply with its
other obligations hereunder.
(d)
Delivery of the Offered Shares to be Sold. Delivery of Offered Shares by such Selling Stockholder
pursuant to this Agreement will pass good and valid title to such Offered Shares, free and clear of any security interest, mortgage,
pledge, lien, encumbrance or other adverse claim.
(e)
Non-Contravention; No Further Authorizations or Approvals Required. The execution and delivery
by such Selling Stockholder of, and the performance by such Selling Stockholder of its obligations under, this Agreement, the Custody
Agreement and the Power of Attorney will not contravene or conflict with, result in a breach of, or constitute a Default under,
or require the consent of any other party to, the charter or by-laws, partnership agreement, operating agreement or other organizational
documents of such Selling Stockholder or any other agreement or instrument to which such Selling Stockholder is a party or by which
it is bound or under which it is entitled to any right or benefit, any provision of applicable law or any judgment, order, decree
or regulation applicable to such Selling Stockholder of any court, regulatory body, administrative agency, governmental body or
arbitrator having jurisdiction over such Selling Stockholder. No consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental authority or agency, is required for the consummation by such Selling Stockholder
of the transactions contemplated in this Agreement, except such as may be required under the Securities Act, applicable state securities
or blue sky laws and from the FINRA.
(f)
No Registration, Pre-emptive, Co-Sale or Other Similar Rights. Such Selling Stockholder: (i) does
not have any registration or other similar rights to have any securities registered for sale by the Company under the Registration
Statement or included in the offering contemplated by this Agreement, except for such rights as are described in the Registration
Statement, the Time of Sale Prospectus and the Prospectus; (ii) does not have any preemptive right, co-sale right, right of first
refusal or other similar right to purchase any of the Offered Shares that are to be sold by the Company or any of the other Selling
Stockholders to the Underwriters pursuant to this Agreement, except for such rights as such Selling Stockholder has waived prior
to the date hereof and are described in the Registration Statement, the Time of Sale Prospectus and the Prospectus; and (iii) does
not own any warrants, options or similar rights to acquire, and does not have any right or arrangement to acquire, any capital
stock, right, warrants, options or other securities from the Company, other than those described in the Registration Statement,
the Time of Sale Prospectus and the Prospectus.
(g)
No Further Consents, etc. Except for such consents, approvals and waivers as have been obtained
by such Selling Stockholder on or prior to the date of this Agreement, no consent, approval or waiver is required under any instrument
or agreement to which such Selling Stockholder is a party or by which it is bound or under which it is entitled to any right or
benefit, in connection with the offering, sale or purchase by the Underwriters of any of the Offered Shares which may be sold by
such Selling Stockholder under this Agreement or the consummation by such Selling Stockholder of any of the other transactions
contemplated hereby.
(h)
Disclosure Made by Such Selling Stockholder in the Prospectus. All information furnished to the
Company or any Underwriter by or on behalf of such Selling Stockholder in writing expressly for use in the Registration Statement,
the Time of Sale Prospectus or the Prospectus is, and on the First Closing Date and each applicable Option Closing Date will be,
true, correct, and complete in all material respects, and did not, as of the Applicable Time, and on the First Closing Date and
each applicable Option Closing Date will not, contain any untrue statement of a material fact or omit to state any material fact
necessary to make such information not misleading. Such Selling Stockholder confirms as accurate the number of Shares set forth
opposite such Selling Stockholder’s name in the Registration Statement, the Time of Sale Prospectus and the Prospectus under
the caption “Selling Stockholders” (both prior to and after giving effect to the sale of the Offered Shares).
(i)
Material Information. Such Selling Stockholder is not prompted to sell Shares by any information
concerning the Company which is not set forth in the Registration Statement, the Time of Sale Prospectus and the Prospectus.
(j)
No Price Stabilization or Manipulation; Compliance with Regulation M. Neither such Selling Stockholder
nor any of its affiliates has taken, directly or indirectly, any action designed to or that might cause or result in stabilization
or manipulation of the price of the Shares or any reference security, whether to facilitate the sale or resale of the Offered Shares
or otherwise, and has taken no action which would directly or indirectly violate any provision of Regulation M.
(k)
No Transfer Taxes or Other Fees. There are no transfer taxes or other similar fees or charges under
Federal law or the laws of any state, or any political subdivision thereof, required to be paid in connection with the execution
and delivery of this Agreement or the sale by such Selling Stockholder of the Offered Shares.
(l)
Distribution of Offering Materials by the Selling Stockholders. Prior to the later of (i) the expiration
or termination of the option granted to the several Underwriters under Section 2 and
(ii) the completion of the Underwriters’ distribution of the Offered Shares, such Selling Stockholder has not distributed
and will not distribute any offering material in connection with the offering and sale of the Offered Shares other than the Registration
Statement, the Preliminary Prospectus, the free writing prospectus(es) listed on Schedule C and the Prospectus.
(m)
OFAC. Such Selling Stockholder is not currently subject to any U.S. sanctions administered by
OFAC and will not directly or indirectly use the proceeds of this offering, or lend, contribute or otherwise make available such
proceeds to any subsidiary, or any joint venture partner or other person or entity, for the purpose of financing the activities
of any person currently subject to any U.S. sanctions administered by OFAC or in any other manner that will result in a violation
by any person (including any person participating in the transaction whether as underwriter, advisor, investor or otherwise) of
U.S. sanctions administered by OFAC.
Any certificate signed by such Selling Stockholder
and delivered to any Underwriter or to counsel for the Underwriters shall be deemed a representation and warranty by such Selling
Stockholder to each Underwriter as to the matters covered thereby.
Such Selling Stockholder acknowledges that
the Underwriters and, for purposes of the opinion to be delivered pursuant to Section 6 hereof, counsel to the Selling Stockholder
and counsel to the Underwriters, will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents
to such reliance.
Section 2.
Purchase, Sale and Delivery of the Offered Shares.
(a)
The Firm Shares. Upon the terms herein set forth, the Selling Stockholders agree to sell to
the several Underwriters an aggregate of 4,000,000 Firm Shares, with each Selling Stockholder selling the number of Firm Shares
set forth opposite such Selling Stockholder’s name on Schedule B. On the basis of the representations, warranties
and agreements herein contained, and upon the terms but subject to the conditions herein set forth, the Underwriters agree, severally
and not jointly, to purchase from the Selling Stockholders the respective number of Firm Shares set forth opposite their names
on Schedule A. The purchase price per Firm Share to be paid by the several Underwriters to the Selling Stockholders shall
be $13.16 per share.
(b)
The First Closing Date. Delivery of certificates for the Firm Shares to be purchased by the Underwriters
and payment therefor shall be made at the offices of Covington & Burling LLP (or such other place as may be agreed to by the
Selling Stockholders and Jefferies) at 9:00 a.m. New York City time, on March 31, 2015, or such other time and date not
later than 1:30 p.m. New York City time, on April 14, 2015, as Jefferies shall designate by notice to the Selling Stockholders
(the time and date of such closing are called the “First Closing Date”). The Company and the Selling Stockholders
hereby acknowledge that circumstances under which Jefferies may provide notice to postpone the First Closing Date as originally
scheduled include, but are not limited to, any determination by the Company, the Selling Stockholders or Jefferies to recirculate
to the public copies of an amended or supplemented Prospectus or a delay as contemplated by the provisions of Section 11 and Section
19.
(c)
The Optional Shares; Option Closing Date. In addition, on the basis of the representations, warranties
and agreements herein contained, and upon the terms but subject to the conditions herein set forth, the Selling Stockholders hereby
grant an option to the several Underwriters to purchase, severally and not jointly, up to an aggregate of 600,000 Optional Shares
from the Selling Stockholders at the purchase price per share to be paid by the Underwriters for the Firm Shares, less an amount
per share equal to any dividend or distribution declared by the Company and payable on the Firm Shares but not payable on Optional
Shares. The option granted hereunder may be exercised at any time and from time to time in whole or in part upon notice by Jefferies
to the Selling Stockholders (with a copy to the Company), which notice may be given at any time within 30 days from the date
of this Agreement. Such notice shall set forth (i) the aggregate number of Optional Shares as to which the Underwriters are
exercising the option and (ii) the time, date and place at which certificates for the Optional Shares will be delivered (which
time and date may be simultaneous with, but not earlier than, the First Closing Date; and in the event that such time and date
are simultaneous with the First Closing Date, the term “First Closing Date” shall refer to the time and date
of delivery of certificates for the Firm Shares and such Optional Shares). Any such time and date of delivery, if subsequent to
the First Closing Date, is called an “Option Closing Date,” shall be determined by Jefferies and shall not be
earlier than three or later than five full business days after delivery of such notice of exercise. If any Optional Shares are
to be purchased, (a) each Underwriter agrees, severally and not jointly, to purchase the number of Optional Shares (subject
to such adjustments to eliminate fractional shares as Jefferies may determine) that bears the same proportion to the total number
of Optional Shares to be purchased as the number of Firm Shares set forth on Schedule A opposite the name of such Underwriter
bears to the total number of Firm Shares and (b) each Selling Stockholder agrees, severally and not jointly, to sell the number
of Optional Shares (subject to such adjustments to eliminate fractional shares as Jefferies may determine) that bears the same
proportion to the total number of Optional Shares to be sold as the number of Optional Shares set forth in Schedule B opposite
the name of such Selling Stockholder. Jefferies may cancel the option at any time prior to its expiration by giving written notice
of such cancellation to the Selling Stockholders (with a copy to the Company).
(d)
Public Offering of the Offered Shares. The Representatives hereby advise the Company and the Selling
Stockholders that the Underwriters intend to offer for sale to the public, initially on the terms set forth in the Registration
Statement, the Time of Sale Prospectus and the Prospectus, their respective portions of the Offered Shares as soon after this Agreement
has been executed as the Representatives, in their sole judgment, have determined is advisable and practicable.
(e)
Payment for the Offered Shares.
(i)
Payment for the Offered Shares to be sold by the Selling Stockholders shall be made at the First Closing Date (and, if applicable,
at each Option Closing Date) by wire transfer of immediately available funds to the order of the Custodian.
(i)
It is understood that the Jefferies has been authorized, for its own account and the accounts of the several Underwriters,
to accept delivery of and receipt for, and make payment of the purchase price for, the Firm Shares and any Optional Shares the
Underwriters have agreed to purchase. Jefferies, individually and not as a Representative of the Underwriters, may (but shall not
be obligated to) make payment for any Offered Shares to be purchased by any Underwriter whose funds shall not have been received
by Jefferies by the First Closing Date or the applicable Option Closing Date, as the case may be, for the account of such Underwriter,
but any such payment shall not relieve such Underwriter from any of its obligations under this Agreement.
(ii)
Each Selling Stockholder hereby agrees that (i) it will pay all stock transfer taxes, stamp duties and other similar
taxes, if any, payable upon the sale or delivery of the Offered Shares to be sold by such Selling Stockholder to the several Underwriters,
or otherwise in connection with the performance of such Selling Stockholder’s obligations hereunder and under the Custody
Agreement and (ii) the Custodian is authorized to deduct for such payment any such amounts from the proceeds to such Selling
Stockholder hereunder and to hold such amounts for the account of such Selling Stockholder with the Custodian under the Custody
Agreement.
(f)
Delivery of the Offered Shares. The Selling Stockholders shall deliver, or cause to be delivered
to Jefferies for the accounts of the several Underwriters certificates for the Firm Shares to be sold by them at the First Closing
Date, against release of a wire transfer of immediately available funds for the amount of the purchase price therefor. The Selling
Stockholders shall also deliver, or cause to be delivered to Jefferies for the accounts of the several Underwriters, certificates
for the Optional Shares the Underwriters have agreed to purchase from them at the First Closing Date or the applicable Option Closing
Date, as the case may be, against the release of a wire transfer of immediately available funds for the amount of the purchase
price therefor. The certificates for the Offered Shares shall be registered in such names and denominations as Jefferies shall
have requested at least two full business days prior to the First Closing Date (or the applicable Option Closing Date, as the case
may be) and shall be made available for inspection on the business day preceding the First Closing Date (or the applicable Option
Closing Date, as the case may be) at a location in New York City as Jefferies may designate. Time shall be of the essence, and
delivery at the time and place specified in this Agreement is a further condition to the obligations of the Underwriters.
Section 3.
Additional Covenants.
A.
Covenants of the Company. The Company further covenants and agrees with each Underwriter as follows:
(a)
Delivery of Registration Statement, Time of Sale Prospectus and Prospectus. The Company
shall furnish to you in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding
the date of this Agreement and during the period when a prospectus relating to the Offered Shares is required by the Securities
Act to be delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule) in connection
with sales of the Offered Shares, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b)
Representatives’ Review of Proposed Amendments and Supplements. During the period
when a prospectus relating to the Offered Shares is required by the Securities Act to be delivered (whether physically or through
compliance with Rule 172 under the Securities Act or any similar rule), the Company (i) will furnish to the Representatives for
review, a reasonable period of time prior to the proposed time of filing of any proposed amendment or supplement to the Registration
Statement, a copy of each such amendment or supplement and (ii) will not amend or supplement the Registration Statement (including
any amendment or supplement through incorporation of any report filed under the Exchange Act) without the Representatives’
prior written consent. Prior to amending or supplementing any preliminary prospectus, the Time of Sale Prospectus or the Prospectus
(including any amendment or supplement through incorporation of any report filed under the Exchange Act), the Company shall furnish
to the Representatives for review, a reasonable amount of time prior to the time of filing or use of the proposed amendment or
supplement, a copy of each such proposed amendment or supplement. The Company shall not file or use any such proposed amendment
or supplement without the Representatives’ prior written consent. The Company shall file with the Commission within the applicable
period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.
(c)
Free Writing Prospectuses. The Company shall furnish to the Representatives for review,
a reasonable amount of time prior to the proposed time of filing or use thereof, a copy of each proposed free writing prospectus
or any amendment or supplement thereto prepared by or on behalf of, used by, or referred to by the Company, and the Company shall
not file, use or refer to any proposed free writing prospectus or any amendment or supplement thereto without the Representatives’
prior written consent. The Company shall furnish to each Underwriter, without charge, as many copies of any free writing prospectus
prepared by or on behalf of, used by or referred to by the Company as such Underwriter may reasonably request. If at any time when
a prospectus is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 under the
Securities Act or any similar rule) in connection with sales of the Offered Shares (but in any event if at any time through and
including the First Closing Date) there occurred or occurs an event or development as a result of which any free writing prospectus
prepared by or on behalf of, used by, or referred to by the Company conflicted or would conflict with the information contained
in the Registration Statement or included or would include an untrue statement of a material fact or omitted or would omit to state
a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at such time, not
misleading, the Company shall promptly amend or supplement such free writing prospectus to eliminate or correct such conflict so
that the statements in such free writing prospectus as so amended or supplemented will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing
at such time, not misleading, as the case may be; provided, however, that prior to amending or supplementing any such free
writing prospectus, the Company shall furnish to the Representatives for review, a reasonable amount of time prior to the proposed
time of filing or use thereof, a copy of such proposed amended or supplemented free writing prospectus, and the Company shall not
file, use or refer to any such amended or supplemented free writing prospectus without the Representatives’ prior written
consent.
(d)
Filing of Underwriter Free Writing Prospectuses. The Company shall not take any action
that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the
Securities Act a free writing prospectus prepared by or on behalf of such Underwriter that such Underwriter otherwise would not
have been required to file thereunder.
(e)
Amendments and Supplements to Time of Sale Prospectus. If the Time of Sale Prospectus is
being used to solicit offers to buy the Offered Shares at a time when the Prospectus is not yet available to prospective purchasers,
and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus
so that the Time of Sale Prospectus does not include an untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances when delivered to a prospective purchaser, not misleading,
or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information
contained in the Registration Statement, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement
the Time of Sale Prospectus to comply with applicable law, the Company shall (subject to Section 3A(b) and Section 3A(c) hereof)
promptly prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request,
either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended
or supplemented will not include an untrue statement of a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances when delivered to a prospective purchaser, not misleading or so
that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the information contained in the Registration
Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.
(f)
Certain Notifications and Required Actions. After the date of this Agreement, the Company shall
promptly advise the Representatives in writing of: (i) the receipt of any comments of, or requests for additional or supplemental
information from, the Commission with respect to the offering or sale of the Offered Shares (the “Offering”);
(ii) the time and date of any filing of any post-effective amendment to the Registration Statement or any amendment or supplement
to any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus or the Prospectus to the extent relating
to or affecting the Offering; (iii) the time and date that any post-effective amendment to the Registration Statement becomes effective
to the extent relating to or affecting the Offering; and (iv) the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment thereto or any amendment or supplement to any preliminary prospectus,
the Time of Sale Prospectus or the Prospectus or of any order preventing or suspending the use of any preliminary prospectus, the
Time of Sale Prospectus, any free writing prospectus or the Prospectus, or of any proceedings to remove, suspend or terminate from
listing or quotation the Shares from any securities exchange upon which they are listed for trading or included or designated for
quotation, or of the threatening or initiation of any proceedings for any of such purposes, in each case, to the extent relating
to or affecting the Offering. If the Commission shall enter any such stop order at any time, the Company will use its best efforts
to obtain the lifting of such order at the earliest possible moment. Additionally, the Company agrees that it shall comply with
all applicable provisions of Rule 424(b), Rule 433 and Rule 430B under the Securities Act and will use its reasonable efforts
to confirm that any filings made by the Company under Rule 424(b) or Rule 433 were received in a timely manner by the Commission.
(g)
Amendments and Supplements to the Prospectus and Other Securities Act Matters. If any event shall
occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus so that the Prospectus does
not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances when the Prospectus is delivered (whether physically or through compliance with Rule 172 under
the Securities Act or any similar rule) to a purchaser, not misleading, or if in the opinion of the Representatives or counsel
for the Underwriters it is otherwise necessary to amend or supplement the Prospectus to comply with applicable law, the Company
agrees (subject to Section 3A(b) and Section 3A(c)) hereof to promptly prepare, file with the Commission and furnish, at its own
expense, to the Underwriters and to any dealer upon request, amendments or supplements to the Prospectus so that the statements
in the Prospectus as so amended or supplemented will not include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances when the Prospectus is delivered (whether
physically or through compliance with Rule 172 under the Securities Act or any similar rule) to a purchaser, not misleading or
so that the Prospectus, as amended or supplemented, will comply with applicable law. Neither the Representatives’ consent
to, nor delivery of, any such amendment or supplement shall constitute a waiver of any of the Company’s obligations under
Section 3A(b) or Section 3A(c).
(h)
Blue Sky Compliance. The Company shall cooperate with the Representatives and counsel for the Underwriters
to qualify or register the Offered Shares for sale under (or obtain exemptions from the application of) the state securities or
blue sky laws or Canadian provincial securities laws of those jurisdictions designated by the Representatives, shall comply with
such laws and shall continue such qualifications, registrations and exemptions in effect so long as required for the distribution
of the Offered Shares. The Company shall not be required to qualify as a foreign corporation or to take any action that would subject
it to general service of process in any such jurisdiction where it is not presently qualified or where it would be subject to taxation
as a foreign corporation. The Company will advise the Representatives promptly of the suspension of the qualification or registration
of (or any such exemption relating to) the Offered Shares for offering, sale or trading in any jurisdiction or any initiation or
threat of any proceeding for any such purpose, and in the event of the issuance of any order suspending such qualification, registration
or exemption, the Company shall use its best efforts to obtain the withdrawal thereof at the earliest possible moment.
(i)
Use of Proceeds. The Company shall apply the net proceeds from the sale of the Offered Shares sold
by it in the manner described under the caption “Use of Proceeds” in the Registration Statement, the Time of Sale Prospectus
and the Prospectus.
(j)
Transfer Agent. The Company shall engage and maintain, at its expense, a registrar and transfer
agent for the Shares.
(k)
Earnings Statement. The Company will make generally available to its security holders and to the
Representatives as soon as practicable an earnings statement (which need not be audited) covering a period of at least twelve months
beginning with the first fiscal quarter of the Company commencing after the date of this Agreement that will satisfy the provisions
of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.
(l)
Continued Compliance with Securities Laws. The Company will comply with the Securities Act and
the Exchange Act so as to permit the completion of the distribution of the Offered Shares as contemplated by this Agreement,
the Registration Statement, the Time of Sale Prospectus and the Prospectus. Without limiting the generality of the foregoing,
the Company will, during the period when a prospectus relating to the Offered Shares is required by the Securities Act to be delivered
(whether physically or through compliance with Rule 172 under the Securities Act or any similar rule), file on a timely basis with
the Commission and the NASDAQ all reports and documents required to be filed under the Exchange Act.
(m)
Listing. After the date of this Agreement and until the first anniversary of the First Closing
Date, the Company will use its best efforts to maintain the listing of the Offered Shares on the NASDAQ.
(n)
Company to Provide Copy of the Prospectus in Form That May be Downloaded from the Internet. If
requested by the Representatives, the Company shall cause to be prepared and delivered, at its expense, within one business day
from the effective date of this Agreement, to the Representatives an “electronic Prospectus” to be used by the
Underwriters in connection with the offering and sale of the Offered Shares. As used herein, the term “electronic Prospectus”
means a form of Time of Sale Prospectus, and any amendment or supplement thereto, that meets each of the following conditions:
(i) it shall be encoded in an electronic format, satisfactory to the Representatives, that may be transmitted electronically by
the Representatives and the other Underwriters to offerees and purchasers of the Offered Shares; (ii) it shall disclose the
same information as the paper Time of Sale Prospectus, except to the extent that graphic and image material cannot be disseminated
electronically, in which case such graphic and image material shall be replaced in the electronic Prospectus with a fair and accurate
narrative description or tabular representation of such material, as appropriate; and (iii) it shall be in or convertible
into a paper format or an electronic format, satisfactory to Jefferies, that will allow investors to store and have continuously
ready access to the Time of Sale Prospectus at any future time, without charge to investors (other than any fee charged for subscription
to the Internet as a whole and for on-line time). The Company hereby confirms that it has included or will include in the Prospectus
filed pursuant to EDGAR or otherwise with the Commission and in the Registration Statement at the time it was declared effective
an undertaking that, upon receipt of a request by an investor or his or her representative, the Company shall transmit or cause
to be transmitted promptly, without charge, a paper copy of the Time of Sale Prospectus.
(o)
Agreement Not to Offer or Sell Additional Shares. During the period commencing on and including
the date hereof and continuing through and including the 90th day following the date of the Prospectus (such period, as extended
as described below, being referred to herein as the “Lock-up Period”), the Company will not, without the prior
written consent of the Representatives (which consent may be withheld in their sole discretion), directly or indirectly: (i) sell,
offer to sell, contract to sell or lend any Shares or Related Securities (as defined below); (ii) effect any short sale, or establish
or increase any “put equivalent position” (as defined in Rule 16a-1(h) under the Exchange Act) or liquidate or decrease
any “call equivalent position” (as defined in Rule 16a-1(b) under the Exchange Act) of any Shares or Related Securities;
(iii) pledge, hypothecate or grant any security interest in any Shares or Related Securities; (iv) in any other way transfer
or dispose of any Shares or Related Securities; (v) enter into any swap, hedge or similar arrangement or agreement that transfers,
in whole or in part, the economic risk of ownership of any Shares or Related Securities, regardless of whether any such transaction
is to be settled in securities, in cash or otherwise; (vi) announce the offering of any Shares or Related Securities; (vii) file
any registration statement under the Securities Act in respect of any Shares or Related Securities (other than as contemplated
by this Agreement with respect to the Offered Shares); or (viii) publicly announce the intention to do any of the foregoing; provided,
however, that the Company may (A) effect the transactions contemplated hereby and (B) issue Shares or options to purchase Shares,
or issue Shares upon exercise of options, pursuant to any stock option, stock bonus or other stock plan or arrangement described
in the Registration Statement, the Time of Sale Prospectus and the Prospectus, but only if the holders of such Shares or options
agree in writing with the Underwriters not to sell, offer, dispose of or otherwise transfer any such Shares or options during such
Lock-up Period without the prior written consent of the Representatives (which consent may be withheld in their sole discretion).
For purposes of the foregoing, “Related Securities” shall mean any options or warrants or other rights to acquire
Shares or any securities exchangeable or exercisable for or convertible into Shares, or to acquire other securities or rights ultimately
exchangeable or exercisable for, or convertible into, Shares. If (i) during the last 17 days of the 90-day initial lock-up period,
the Company issues an earnings release or discloses material news or a material event relating to the Company occurs, or (ii) prior
to the expiration of such period, the Company announces that it will release earnings results during the 16-day period beginning
on the last day of such period, then in each case the Lock-up Period will be extended until the expiration of the 18-day period
beginning on the date of the issuance of the earnings release or the disclosure of the material news or occurrence of the material
event, as applicable, unless the Representatives waives, in writing, such extension (which waiver may be withheld in its sole discretion).
The Company will provide the Representatives with prior notice of any such announcement that gives rise to an extension of the
Lock-up Period.
(p)
Future Reports to the Representatives. During the period of five years hereafter, the Company
will furnish to the Representatives, c/o Jefferies, at 520 Madison Avenue, New York, New York 10022, Attention: Global Head of
Syndicate: (i) as soon as practicable after the end of each fiscal year, copies of the Annual Report of the Company containing
the balance sheet of the Company as of the close of such fiscal year and statements of income, stockholders’ equity
and cash flows for the year then ended and the opinion thereon of the Company’s independent public or certified public accountants;
(ii) as soon as practicable after the filing thereof, copies of each proxy statement, Annual Report on Form 10-K, Quarterly Report
on Form 10-Q, Current Report on Form 8-K or other report filed by the Company with the Commission or any securities exchange; and
(iii) as soon as available, copies of any report or communication of the Company furnished or made available generally to holders
of its capital stock; provided, however, that the requirements of this Section 3A(p) shall be satisfied to the extent that
such reports, statement, communications, financial statements or other documents are available on EDGAR.
(q)
No Stabilization or Manipulation; Compliance with Regulation M. The Company will not take, and
will ensure that no affiliate of the Company will take, directly or indirectly, any action designed to or that might reasonably
be expected to cause or result in stabilization or manipulation of the price of the Shares or any reference security with respect
to the Shares, whether to facilitate the sale or resale of the Offered Shares or otherwise, and the Company will, and shall cause
each of its affiliates to, comply with all applicable provisions of Regulation M.
(r)
Enforce Lock-Up Agreements. During the Lock-up Period, the Company will enforce all agreements
between the Company and any of its security holders that restrict or prohibit, expressly or in operation, the offer, sale or transfer
of Shares or Related Securities or any of the other actions restricted or prohibited under the terms of the form of Lock-up Agreement.
In addition, the Company will direct the transfer agent to place stop transfer restrictions upon any such securities of the Company
that are bound by such “lock-up” agreements for the duration of the periods contemplated in such agreements, including,
without limitation, “lock-up” agreements entered into by the Company’s officers and directors pursuant to Section
6(n) hereof.
(s)
Company to Provide Interim Financial Statements. Prior to the First Closing Date and each applicable
Option Closing Date, the Company will furnish the Underwriters, as soon as they have been prepared by or are available to the Company,
a copy of any unaudited interim financial statements of the Company for any period subsequent to the period covered by the most
recent financial statements appearing in the Registration Statement and the Prospectus.
B.
Covenants of the Selling Stockholders. Each Selling Stockholder further covenants and agrees with each Underwriter:
(a)
Agreement Not to Offer or Sell Additional Shares. During the Lock-up Period, such Selling Stockholder
will not, without the prior written consent of the Representatives (which consent may be withheld in their sole discretion), directly
or indirectly (except as set forth in Section 2 of this Agreement): (i) sell, offer to sell, contract to sell or lend any Shares
or Related Securities; (ii) effect any short sale or establish or increase any put equivalent position or liquidate or decrease
any call equivalent position of any Shares or Related Securities; (iii) pledge, hypothecate or grant any security interest in any
Shares or Related Securities; (iv) in any other way transfer or dispose of any Shares or Related Securities; (v) enter into any
swap, hedge or similar arrangement or agreement that transfers, in whole or in part, the economic risk of ownership of any Shares
or Related Securities, regardless of whether any such transaction is to be settled in securities, in cash or otherwise; (vi) announce
the offering of any Shares or Related Securities; (vii) participate in the filing of any registration statement under the Securities
Act in respect of any Shares or Related Securities (other than as contemplated by this Agreement with respect to the Offered Shares);
or (viii) publicly announce the intention to do any of the foregoing.
(b)
No Stabilization or Manipulation; Compliance with Regulation M. Such Selling Stockholder will not
take, directly or indirectly, any action designed to or that might cause or result in stabilization or manipulation of the price
of the Shares or any reference security with respect to the Shares, whether to facilitate the sale or resale of the Offered Shares
or otherwise, and such Selling Stockholder will, and shall cause each of its affiliates to, comply with all applicable provisions
of Regulation M.
(c)
Notification. Such Selling Stockholder will advise you promptly, and if requested by you, will
confirm such advice in writing, during the period when a prospectus relating to the Offered Shares is required by the Securities
Act to be delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule), of (i) any
Material Adverse Change, (ii) any change in information in the Registration Statement, any preliminary prospectus, any free
writing prospectus, the Prospectus or any amendment or supplement thereto relating to such Selling Stockholder, or (iii) any
new material information relating to the Company or relating to any matter stated in the Registration Statement, the Time of Sale
Prospectus or the Prospectus that comes to the attention of such Selling Stockholder.
(d)
Delivery of Forms W-8 and W-9. To deliver to the Representatives prior to the First Closing Date
a properly completed and executed United States Treasury Department Form W-8 (if the Selling Stockholder is a non-United States
person) or Form W-9 (if the Selling Stockholder is a United States Person).
The Representatives,
on behalf of the several Underwriters, may, in their sole discretion, waive in writing the performance by the Company or any Selling
Stockholder of any one or more of the foregoing covenants or extend the time for their performance.
Section 4.
Payment of Expenses. The Company agrees to pay all out of pocket costs, fees and expenses incurred in connection with
the performance of their and the Selling Stockholders’ obligations hereunder and in connection with the transactions contemplated
hereby, including without limitation (i) all expenses incident to the issuance and delivery of the Offered Shares (including
all printing and engraving costs), (ii) all fees and expenses of the registrar and transfer agent of the Shares, (iii) all
necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Offered Shares to the Underwriters,
(iv) all fees and expenses of the Company’s counsel, independent public or certified public accountants and other advisors,
(v) all costs and expenses incurred in connection with the preparation, printing, filing, shipping and distribution of the
Registration Statement (including financial statements, exhibits, schedules, consents and certificates of experts), the Time of
Sale Prospectus, the Prospectus, each free writing prospectus prepared by or on behalf of, used by, or referred to by the Company,
and each preliminary prospectus, and all amendments and supplements thereto, and this Agreement, (vi) all filing fees, reasonable
attorneys’ fees and expenses incurred by the Company or the Underwriters in connection with qualifying or registering (or
obtaining exemptions from the qualification or registration of) all or any part of the Offered Shares for offer and sale under
the state securities or blue sky laws or the provincial securities laws of Canada, and, if requested by the Representatives, preparing
and printing a “Blue Sky Survey” or memorandum and a “Canadian wrapper”, and any supplements thereto, advising
the Underwriters of such qualifications, registrations and exemptions in an amount not to exceed $5,000, (vii) the costs,
fees and expenses incurred by the Underwriters in connection with determining their compliance with the rules and regulations of
FINRA related to the Underwriters’ participation in the offering and distribution of the Offered Shares, including any related
filing fees and the legal fees of, and disbursements by, counsel to the Underwriters in an amount not to exceed $10,000 (excluding
filing fees), (viii) the costs and expenses of the Company relating to investor presentations on any “road show”,
including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses
associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with
the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives, employees
and officers of the Company and any such consultants, and the cost of any aircraft chartered in connection with the road show,
(ix) the fees and expenses associated with listing the Offered Shares on the NASDAQ, and (x) all other fees, costs and
expenses of the nature referred to in Item 14 of Part II of the Registration Statement. Except as provided in this Section
4 or in Section 7, Section 9 or Section 10 hereof, the Underwriters shall pay their own expenses, including the fees and disbursements
of their counsel and their own travel and lodging expenses.
In addition to paying all underwriting discounts
and commissions with respect to the Offered Shares, the Selling Stockholders further agree with each Underwriter to pay (directly
or by reimbursement) all out-of-pocket fees and expenses incident to the performance of their obligations under this Agreement
that are not otherwise specifically provided for herein, including but not limited to (i) fees and expenses of counsel and
other advisors for such Selling Stockholders, (ii) fees and expenses of the Custodian and the Attorneys-in-Fact and (iii) expenses
and taxes incident to the sale and delivery of the Offered Shares to be sold by such Selling Stockholders to the Underwriters hereunder
(which taxes, if any, may be deducted by the Custodian under the provisions of Section
2 of this Agreement).
This Section
4 shall not affect or modify any separate, valid agreement relating to the allocation of payment of expenses between the Company,
on the one hand, and the Selling Stockholders, on the other hand.
Section 5.
Covenant of the Underwriters. Each Underwriter severally and not jointly covenants with the Company not to take any
action that would result in the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities
Act a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not, but for such actions, be required
to be filed by the Company under Rule 433(d).
Section 6.
Conditions of the Obligations of the Underwriters. The respective obligations of the several Underwriters hereunder
to purchase and pay for the Offered Shares as provided herein on the First Closing Date and, with respect to the Optional Shares,
each Option Closing Date, shall be subject to the accuracy of the representations and warranties on the part of the Company and
the Selling Stockholders set forth in Section 1 hereof as of the date hereof and
as of the First Closing Date as though then made and, with respect to the Optional Shares, as of each Option Closing Date as though
then made, to the timely performance by the Company and the Selling Stockholders of their respective covenants and other obligations
hereunder, and to each of the following additional conditions:
(a)
Comfort Letter. On the date hereof, the Representatives shall have received from PricewaterhouseCoopers
LLP, independent registered public accountants for the Company, a letter dated the date hereof addressed to the Underwriters, in
form and substance satisfactory to the Representatives, containing statements and information of the type ordinarily included in
accountant’s “comfort letters” to underwriters, delivered according to Statement of Auditing Standards No. 72
(or any successor bulletin), with respect to the audited and unaudited financial statements and certain financial information contained
in the Registration Statement, the Time of Sale Prospectus, and each free writing prospectus, if any.
(b)
Compliance with Registration Requirements; No Stop Order; No Objection from FINRA.
(i)
The Company shall have filed the Prospectus with the Commission (including the information previously omitted from the Registration
Statement pursuant to Rule 430B under the Securities Act) in the manner and within the time period required by Rule 424(b) under
the Securities Act; or the Company shall have filed a post-effective amendment to the Registration Statement containing the information
previously omitted from the Registration Statement pursuant to such Rule 430B, and such post-effective amendment shall have become
effective.
(ii)
No stop order suspending the effectiveness of the Registration Statement or any post-effective amendment to the Registration
Statement shall be in effect, and no proceedings for such purpose shall have been instituted or, to the Company’s knowledge,
threatened by the Commission.
(iii)
If a filing has been made with FINRA, FINRA shall have raised no objection to the fairness and reasonableness of the underwriting
terms and arrangements.
(c)
No Material Adverse Change. For the period from and after the date of this Agreement and through
and including the First Closing Date and, with respect to any Optional Shares purchased after the First Closing Date, each Option
Closing Date in the judgment of the Representatives there shall not have occurred any Material Adverse Change.
(d)
Opinion of Counsel for the Company. On each of the First Closing Date and each Option Closing Date,
the Representatives shall have received an opinion and negative assurance letter of Manatt, Phelps & Phillips, LLP, counsel
for the Company, dated as of such date, in the forms attached hereto as Exhibit A-1 and A-2.
(e)
Opinion of Chief Legal Counsel of the Company. On each of the First Closing Date and each Option
Closing Date, the Representatives shall have received an opinion of Thomas J. Knapp, Executive Vice President, Chief Legal Officer
of the Company, dated as of such date, in the form attached hereto as Exhibit A-3.
(f)
IP Certificate. On each of the First Closing Date and each Option Closing Date, the Representatives
shall have received a certificate from Misako Nakata, Executive Vice President and Chief Intellectual Property Officer of the Company,
dated as of such date, with respect to intellectual property matters, in such person’s capacity as an employee of the Company.
(g)
Regulatory Certificate. On each of the First Closing Date and each Option Closing Date,
the Representatives shall have received a certificate from Steven Caffe, Senior Vice President, Regulatory Affairs of the Company,
dated as of such date, with respect to regulatory matters, in such person’s capacity as an employee of the Company.
(h)
Opinion of Counsel for the Underwriters. On each of the First Closing Date and each Option Closing
Date the Representatives shall have received the opinion of Covington & Burling LLP, counsel for the Underwriters in connection
with the offer and sale of the Offered Shares, in form and substance satisfactory to the Underwriters, dated as of such date.
(i)
Officers’ Certificate. On each of the First Closing Date and each Option Closing Date, the
Representatives shall have received a certificate executed by the Chief Executive Officer or President of the Company and the Chief
Financial Officer of the Company, dated as of such date, to the effect set forth in Section
6(b)(ii) and further to the effect that:
(i)
for the period from and including the date of this Agreement through and including such date, there has not occurred any
Material Adverse Change;
(ii)
the representations, warranties and covenants of the Company set forth in Section 1A of this Agreement are true and correct
with the same force and effect as though expressly made on and as of such date; and
(iii)
the Company has complied with all the agreements hereunder and satisfied all the conditions on its part to be performed
or satisfied hereunder at or prior to such date.
(j)
Bring-down Comfort Letter. On each of the First Closing Date and each Option Closing Date the Representatives
shall have received from PricewaterhouseCoopers LLP, independent registered public accountants for the Company, a letter dated
such date, in form and substance satisfactory to the Representatives, which letter shall: (i) reaffirm the statements made in the
letter furnished by them pursuant to Section 6(a), except that the specified date referred
to therein for the carrying out of procedures shall be no more than three business days prior to the First Closing Date or the
applicable Option Closing Date, as the case may be; and (ii) cover certain financial information contained in the Prospectus.
(k)
Opinion of Counsel for the Selling Stockholders. On each of the First Closing Date and each Option
Closing Date, the Representatives shall have received the opinion of McGuireWoods LLP, counsel for the Selling Stockholders, dated
as of such date, in the form attached hereto as Exhibit B.
(l)
Selling Stockholders’ Certificate. On each of the First Closing Date and each Option Closing
Date, the Representatives shall receive a written certificate executed by the Attorney-in-Fact of each Selling Stockholder, dated
as of such date, to the effect that:
(i)
the representations, warranties and covenants of such Selling Stockholder set forth in Section
1B of this Agreement are true and correct with the same force and effect as though expressly made by such Selling Stockholder on
and as of such date; and
(ii)
such Selling Stockholder has complied with all the agreements and satisfied all the conditions on its part to be performed
or satisfied at or prior to such date.
(m)
Selling Stockholders’ Documents. On the date hereof, the Selling Stockholders shall have
furnished for review by the Representatives copies of the Powers of Attorney and Custody Agreements executed by each of the Selling
Stockholders and such further information, certificates and documents as the Representatives may reasonably request.
(n)
Lock-Up Agreements. On or prior to the date hereof, the Company shall have furnished to the Representatives
an agreement in the form of Exhibit C hereto from each of the persons listed on Exhibit D hereto, and each such agreement
shall be in full force and effect on each of the First Closing Date and each Option Closing Date.
(o)
Rule 462(b) Registration Statement. In the event that a Rule 462(b) Registration Statement
is filed in connection with the offering contemplated by this Agreement, such Rule 462(b) Registration Statement shall have
been filed with the Commission on the date of this Agreement and shall have become effective automatically upon such filing.
(p)
Additional Documents. On or before each of the First Closing Date and each Option Closing Date,
the Representatives and counsel for the Underwriters shall have received such information, documents and opinions as they may reasonably
request for the purposes of enabling them to pass upon the issuance and sale of the Offered Shares as contemplated herein, or in
order to evidence the accuracy of any of the representations and warranties, or the satisfaction of any of the conditions or agreements,
herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Offered Shares as contemplated
herein and in connection with the other transactions contemplated by this Agreement shall be satisfactory in form and substance
to the Representatives and counsel for the Underwriters.
If any condition specified in this Section
6 is not satisfied when and as required to be satisfied, this Agreement may be terminated by the Representatives by notice from
the Representatives to the Company and the Selling Stockholders at any time on or prior to the First Closing Date and, with respect
to the Optional Shares, at any time on or prior to the applicable Option Closing Date, which termination shall be without liability
on the part of any party to any other party, except that Section 4, Section
7, Section 9 and Section 10 shall at all times
be effective and shall survive such termination.
Section 7.
Reimbursement of Underwriters’ Expenses. If this Agreement is terminated by the Representatives pursuant to Section
6, Section 12 or Section 19, or if the sale to the Underwriters of the Offered Shares on the First Closing Date is not consummated
because of any refusal, inability or failure on the part of the Company or the Selling Stockholders to perform any agreement herein
or to comply with any provision hereof, the Company (or, if and to the extent such termination or failure to consummate results
from the refusal, inability or failure on the part of any Selling Stockholder to perform any of its agreements herein or to comply
with any provision hereof applicable to the Selling Stockholders, then the Selling Stockholders, rather than and in substitution
for the Company) shall reimburse the Representatives and the other Underwriters (or such Underwriters as have terminated this Agreement
with respect to themselves), severally, upon demand for all out-of-pocket expenses that shall have been reasonably incurred by
the Representatives and the Underwriters in connection with the proposed purchase and the offering and sale of the Offered Shares,
including, but not limited to, fees and disbursements of counsel, printing expenses, travel expenses, postage, facsimile and telephone
charges.
Section 8.
Effectiveness of this Agreement. This Agreement shall become effective upon the execution and delivery hereof by
the parties hereto.
Section 9.
Indemnification.
(a)
Indemnification of the Underwriters. The Company and each of the Selling Stockholders agree to
indemnify and hold harmless each Underwriter, its affiliates, directors, officers, employees and agents, and each person, if any,
who controls any Underwriter within the meaning of the Securities Act or the Exchange Act against any loss, claim, damage, liability
or expense, as incurred, to which such Underwriter or such affiliate, director, officer, employee, agent or controlling person
may become subject, under the Securities Act, the Exchange Act, other federal or state statutory law or regulation, or the laws
or regulations of foreign jurisdictions where Offered Shares have been offered or sold or at common law or otherwise (including
in settlement of any litigation, if such settlement is effected with the written consent of the Company and the Selling Stockholders),
insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or
is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement,
or any amendment thereto, or the omission or alleged omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; or (ii) any untrue statement or alleged untrue statement of a material
fact included in any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus that the Company has used,
referred to or filed, or is required to file, pursuant to Rule 433(d) of the Securities Act, any Marketing Material or the Prospectus
(or any amendment or supplement to the foregoing), or the omission or alleged omission to state therein a material fact necessary
in order to make the statements, in the light of the circumstances under which they were made, not misleading; or (iii) any act
or failure to act or any alleged act or failure to act by any Underwriter in connection with, or relating in any manner to, the
Shares or the offering contemplated hereby, and which is included as part of or referred to in any loss, claim, damage, liability
or action arising out of or based upon any matter covered by clause (i) or (ii) above; and to reimburse each Underwriter and each
such affiliate, director, officer, employee, agent and controlling person for any and all expenses (including the fees and disbursements
of counsel) as such expenses are incurred by such Underwriter or such affiliate, director, officer, employee, agent or controlling
person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense
or action; provided, however, that the foregoing indemnity agreement shall not apply to any loss, claim, damage, liability or expense
to the extent, but only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with information relating to any Underwriter furnished to the Company
by the Representatives, in writing expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale
Prospectus, any such free writing prospectus, any Marketing Material or the Prospectus (or any amendment or supplement thereto),
it being understood and agreed that the only such information consists of the information described in Section 9(b) below. Notwithstanding
anything herein to the contrary, a Selling Stockholder shall only be liable for amounts payable under this Section 9 in the event
that (A) the Company (i) becomes, and continues to be, dissolved, whether voluntarily or involuntarily; (ii) applies for or consents
to the appointment of a receiver, trustee or liquidator of all or a substantial part of its assets; (iii) files a voluntary petition
in bankruptcy or otherwise voluntarily avails itself of any federal or state laws for the relief of debtors; (iv) admits in writing
its inability to generally pay its debts as they become due; (v) makes a general assignment for the benefit of creditors; (vi)
files a petition or an answer seeking reorganization or arrangement with creditors or to take advantage of any insolvency law or
file an answer admitting the material allegations of any petition filed against it in any bankruptcy, reorganization or insolvency
proceeding; (vii) publicly announces the intention to do any of the foregoing; or (viii) becomes the subject of an order, judgment
or decree entered by any court of competent jurisdiction, in the application of any one or more creditors of the Company adjudicating
it a bankrupt or insolvent or approving a petition seeking reorganization or appointing a receiver, trustee or liquidator of all
or a substantial part of its assets, and such order, judgment or decree has continued in effect for a period of ninety (90) consecutive
days; (B) an indemnified party shall have obtained a judicial judgment, order or decree (in each case which has not been appealed)
against the Company for amounts payable to such indemnified party under this Section 9(a) and such indemnified party shall have
made a demand upon the Company for payment of such amounts following such judgment, order or decree, which such demand has not
been satisfied in full within 60 days; provided, however, that the indemnified party shall not be required to make such demand
upon the Company and wait such 60 day period if, and to the extent, it would prejudice its right to indemnification from the Selling
Stockholders hereunder; or (C) the liability for which the Underwriters are seeking indemnification arises out of or is based upon
any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with written
information furnished to the Company by the Selling Stockholder expressly for use in the Registration Statement, any preliminary
prospectus, the Time of Sale Prospectus, any such free writing prospectus or the Prospectus (or any amendment or supplement thereto).
Additionally, if at any time one or more of the indemnified parties shall have accrued a collective balance in arrears of any expenses
(including the fees and disbursements of counsel) in connection with investigating, defending, settling, compromising or paying
any loss, claim, damage, liability, expense or action covered by this Section 9(a) (disregarding, for these purposes, the provisions
of the immediately preceding sentence) of at least $100,000 and such indemnified party or parties shall first have sought indemnity
from the Company and the Company has not satisfied such request for indemnification in full within 120 days, then the Selling Stockholders
shall be obligated to the Underwriters to reimburse the applicable indemnified party or parties for such expenses (including any
initial $100,000 thereof) on behalf of the Company; provided that the Selling Stockholders’ obligations pursuant to this
sentence shall not exceed $3.0 million in the aggregate. The obligations of the Selling Stockholders, other than S&R Foundation
("SRF") (each such Selling Stockholder a "Joint Indemnitor" and collectively the "Joint Indemnitors")
and the Company, under this Section 9(a) shall be joint and several, meaning that the Joint Indemnitors and the Company may be
required by any Underwriter to perform its own obligations hereunder as well as the obligations of any Selling Stockholder or the
Company, as the case may be. The obligations of SRF under this Section 9(a) shall be several, meaning that any Underwriter may
require it to perform only those obligations directly applicable to SRF and not the obligations of the Company or any one or more
of the Joint Indemnitors. The liability of the Joint Indemnitors under this Section 9 shall be limited to an amount (when taken
together with all other amounts paid by the Selling Stockholders pursuant to this Section 9) equal to the gross proceeds (the product
of (i) the number of Offered Shares sold by the Selling Stockholders and (ii) the public offering price per share of the Offered
Shares, and before deducting underwriting discounts and commissions and offering expenses) received by the Selling Stockholders
from the sale of the Offered Shares pursuant to this Agreement. The liability of SRF under this Section 9 shall be limited to an
amount (when taken together with all other amounts paid by SRF pursuant to this Section 9) equal to the gross proceeds (the product
of (i) the number of Offered Shares sold by SRF and (ii) the public offering price per share of the Offered Shares, and before
deducting underwriting discounts and commissions and offering expenses) received by SRF from the sale of the Offered Shares pursuant
to this Agreement. The indemnity agreement set forth in this Section 9(a) shall be in addition to any liabilities that the
Company and the Selling Stockholders may otherwise have.
(b)
Indemnification of the Company, its Directors and Officers and the Selling Stockholders. Each Underwriter
agrees, severally and not jointly, to indemnify and hold harmless the Company, each of its directors, each of its officers who
signed the Registration Statement, the Selling Stockholders and each person, if any, who controls the Company or any Selling Stockholder
within the meaning of the Securities Act or the Exchange Act, against any loss, claim, damage, liability or expense, as incurred,
to which the Company, or any such director, officer, Selling Stockholder or controlling person may become subject, under the Securities
Act, the Exchange Act, or other federal or state statutory law or regulation, or at common law or otherwise (including in settlement
of any litigation, if such settlement is effected with the written consent of such Underwriter), insofar as such loss, claim, damage,
liability or expense (or actions in respect thereof as contemplated below) arises out of or is based upon (i) any untrue statement
or alleged untrue statement of a material fact contained in the Registration Statement, or any amendment thereto, or 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 or (ii) any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus,
the Time of Sale Prospectus, any free writing prospectus that the Company has used, referred to or filed, or is required to file,
pursuant to Rule 433 of the Securities Act or the Prospectus (or any such amendment or supplement) or the omission or alleged omission
to state therein a material fact necessary in order to make the statements, in the light of the circumstances under which they
were made, not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Registration Statement, such preliminary prospectus, the Time of Sale Prospectus,
such free writing prospectus or the Prospectus (or any such amendment or supplement), in reliance upon and in conformity with information
relating to such Underwriter furnished to the Company by the Representatives in writing expressly for use therein; and to reimburse
the Company, or any such director, officer, Selling Stockholder or controlling person for any and all expenses (including the fees
and disbursements of counsel) as such expenses are incurred by the Company, or any such director, officer, Selling Stockholder
or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action. The Company and each of the Selling Stockholders, hereby acknowledges that the only information that
the Representatives have furnished to the Company expressly for use in the Registration Statement, any preliminary prospectus,
the Time of Sale Prospectus, any free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d)
of the Securities Act or the Prospectus (or any amendment or supplement to the foregoing) are the statements set forth in paragraphs
under the caption “Underwriting” in the Preliminary Prospectus Supplement and the Final Prospectus Supplement.
The indemnity agreement set forth in this Section 9(b) shall be in addition to any liabilities that each Underwriter may otherwise
have.
(c)
Notifications and Other Indemnification Procedures. Promptly after receipt by an indemnified party
under this Section 9 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party under this Section
9, notify the indemnifying party in writing of the commencement thereof, but the omission so to notify the indemnifying party will
not relieve the indemnifying party from any liability which it may have to any indemnified party to the extent the indemnifying
party is not materially prejudiced as a proximate result of such failure and shall not in any event relieve the indemnifying party
from any liability that it may have otherwise than on account of this indemnity agreement. In case any such action is brought against
any indemnified party and such indemnified party seeks or intends to seek indemnity from an indemnifying party, the indemnifying
party will be entitled to participate in, and, to the extent that it shall elect, jointly with all other indemnifying parties similarly
notified, by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified
party, to assume the defense thereof with counsel reasonably satisfactory to such indemnified party; provided, however,
that if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that a conflict may arise between the positions of the indemnifying party and the indemnified party
in conducting the defense of any such action or that there may be legal defenses available to it and/or other indemnified parties
which are different from or additional to those available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assume such legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified party of such
indemnifying party’s election so to assume the defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this Section 9
for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the fees and expenses of more than one separate counsel (together
with local counsel), representing the indemnified parties who are parties to such action), which counsel (together with any local
counsel) for the indemnified parties shall be selected by Jefferies (in the case of counsel for the indemnified parties referred
to in Section 9(a) above) or by the Company (in the case of counsel for the indemnified parties referred to in Section
9(b) above)) or (ii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of commencement of the action or (iii) the indemnifying party
has authorized in writing the employment of counsel for the indemnified party at the expense of the indemnifying party, in each
of which cases the fees and expenses of counsel shall be at the expense of the indemnifying party and shall be paid as they are
incurred.
(d)
Settlements. The indemnifying party under this Section
9 shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent
or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party against any
loss, claim, damage, liability or expense by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if
at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by Section 9(b) hereof, the indemnifying party shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement, compromise or consent to the entry of judgment in any pending or threatened action, suit or proceeding
in respect of which any indemnified party is or could have been a party and indemnity was or could have been sought hereunder by
such indemnified party, unless such settlement, compromise or consent includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such action, suit or proceeding and does not include an admission of
fault or culpability or a failure to act by or on behalf of such indemnified party.
Section 10.
Contribution. If the indemnification provided for in Section 9 is for
any reason held to be unavailable to or otherwise insufficient to hold harmless an indemnified party in respect of any losses,
claims, damages, liabilities or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount
paid or payable by such indemnified party, as incurred, as a result of any losses, claims, damages, liabilities or expenses referred
to therein (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other hand, from the offering of the Offered Shares pursuant to this
Agreement or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other hand, in connection with the statements
or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other
hand, in connection with the offering of the Offered Shares pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total proceeds from the offering of the Offered Shares pursuant to this Agreement (before deducting expenses)
received by the Company and the Selling Stockholders, and the total underwriting discounts and commissions received by the Underwriters,
in each case as set forth on the front cover page of the Prospectus, bear to the aggregate initial public offering price of the
Offered Shares as set forth on such cover. The relative fault of the Company and the Selling Stockholders, on the one hand, and
the Underwriters, on the other hand, shall be determined by reference to, among other things, whether any such untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by
the Company or the Selling Stockholders, on the one hand, or the Underwriters, on the other hand, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as
a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the
limitations set forth in Section 9(c), any legal or other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in Section 9(c) with respect to notice of commencement
of any action shall apply if a claim for contribution is to be made under this Section
10; provided, however, that no additional notice shall be required with respect to any action for which notice has been
given under Section 9(c) for purposes of indemnification.
The Company, the Selling Stockholders and
the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section
10 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations referred to in this Section
10.
Notwithstanding the provisions of this Section
10, (i) no Underwriter shall be required to contribute any amount in excess of the underwriting discounts and commissions received
by such Underwriter in connection with the Offered Shares underwritten by it and distributed to the public, (ii) no Joint Indemnitor
shall be required to contribute an amount, when taken together with any amounts paid by all Selling Stockholders pursuant to Section
9 or this Section 10, in excess of the gross proceeds (the product of (A) the number of Offered Shares sold by the Selling Stockholders
and (B) the public offering price per share of the Offered Shares, and before deducting the related underwriting discount and commissions
and offering expenses) received by the Selling Stockholders from the sale of the Offered Shares pursuant to this Agreement, and
(iii) SRF shall not be required to contribute an amount (when taken together with all other amounts paid by SRF pursuant to Section
9) equal to the gross proceeds (the product of (i) the number of Offered Shares sold by SRF and (ii) the public offering price
per share of the Offered Shares, and before deducting underwriting discounts and commissions and offering expenses) received by
SRF from the sale of the Offered Shares pursuant to this Agreement. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to this Section
10 are several, and not joint, in proportion to their respective underwriting commitments as set forth opposite their respective
names on Schedule A. For purposes of this Section 10, each affiliate, director,
officer, employee and agent of an Underwriter and each person, if any, who controls an Underwriter within the meaning of the Securities
Act or the Exchange Act shall have the same rights to contribution as such Underwriter, and each director of the Company, each
officer of the Company who signed the Registration Statement, and each person, if any, who controls the Company within the meaning
of the Securities Act and the Exchange Act shall have the same rights to contribution as the Company and each person, if any, who
controls a Selling Stockholder within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution
as such Selling Stockholder.
Section 11.
Default of One or More of the Several Underwriters. If, on the First Closing Date or any Option Closing Date
any one or more of the several Underwriters shall fail or refuse to purchase Offered Shares that it or they have agreed to purchase
hereunder on such date, and the aggregate number of Offered Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase does not exceed 10% of the aggregate number of the Offered Shares to be purchased on such date, the
Representatives may make arrangements satisfactory to the Company and the Selling Stockholders for the purchase of such Offered
Shares by other persons, including any of the Underwriters, but if no such arrangements are made by such date, the other Underwriters
shall be obligated, severally and not jointly, in the proportions that the number of Firm Shares set forth opposite their respective
names on Schedule A bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as may be specified by the Representatives with the consent of the non-defaulting Underwriters,
to purchase the Offered Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such
date. If, on the First Closing Date or any Option Closing Date any one or more of the Underwriters shall fail or refuse to purchase
Offered Shares and the aggregate number of Offered Shares with respect to which such default occurs exceeds 10% of the aggregate
number of Offered Shares to be purchased on such date, and arrangements satisfactory to the Representatives and the Company for
the purchase of such Offered Shares are not made within 48 hours after such default, this Agreement shall terminate without liability
of any party to any other party except that the provisions of Section 4, Section
7, Section 9 and Section 10 shall
at all times be effective and shall survive such termination. In any such case either the Representatives or the Company shall
have the right to postpone the First Closing Date or the applicable Option Closing Date, as the case may be, but in no event for
longer than seven days in order that the required changes, if any, to the Registration Statement and the Prospectus or any other
documents or arrangements may be effected.
As used in this Agreement, the term “Underwriter”
shall be deemed to include any person substituted for a defaulting Underwriter under this Section
11. Any action taken under this Section 11 shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this Agreement.
Section 12.
Termination of this Agreement. Prior to the purchase of the Firm Shares by the Underwriters on the First Closing
Date, this Agreement may be terminated by the Representatives by notice given to the Company and the Selling Stockholders if at
any time: (i) trading or quotation in any of the Company’s securities shall have been suspended or limited by the Commission
or by the NASDAQ, or trading in securities generally on either the NASDAQ or the New York Stock Exchange shall have been suspended
or limited, or minimum or maximum prices shall have been generally established on any of such stock exchanges; (ii) a general
banking moratorium shall have been declared by any of federal, New York, Maryland or Delaware authorities; (iii) there shall
have occurred any outbreak or escalation of national or international hostilities or any crisis or calamity, or any change in the
United States or international financial markets, or any substantial change or development involving a prospective substantial
change in United States’ or international political, financial or economic conditions, as in the judgment of the Representatives
is material and adverse and makes it impracticable to market the Offered Shares in the manner and on the terms described in the
Time of Sale Prospectus or the Prospectus or to enforce contracts for the sale of securities; (iv) in the judgment of the
Representatives there shall have occurred any Material Adverse Change; or (v) the Company shall have sustained a loss by strike,
fire, flood, earthquake, accident or other calamity of such character as in the judgment of the Representatives may interfere materially
with the conduct of the business and operations of the Company regardless of whether or not such loss shall have been insured.
Any termination pursuant to this Section 12 shall be without liability on the
part of (a) the Company or the Selling Stockholders to any Underwriter, except that the Company and the Selling Stockholders
shall be obligated to reimburse the expenses of the Representatives and the Underwriters pursuant to Section
4 or Section 7 hereof or (b) any Underwriter to the Company or the Selling
Stockholders; provided, however, that the provisions of Section 9 and Section
10 shall at all times be effective and shall survive such termination.
Section 13.
No Advisory or Fiduciary Relationship. The Company and the Selling Stockholders acknowledge and agree that (a) the purchase
and sale of the Offered Shares pursuant to this Agreement, including the determination of the public offering price of the Offered
Shares and any related discounts and commissions, is an arm’s-length commercial transaction between the Company and the Selling
Stockholders, on the one hand, and the several Underwriters, on the other hand, (b) in connection with the offering contemplated
hereby and the process leading to such transaction, each Underwriter is and has been acting solely as a principal and is not the
agent or fiduciary of the Company or the Selling Stockholders, or the Company’s other stockholders, creditors, employees
or any other party, (c) no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the
Company or the Selling Stockholders with respect to the offering contemplated hereby or the process leading thereto (irrespective
of whether such Underwriter has advised or is currently advising the Company or the Selling Stockholders on other matters) and
no Underwriter has any obligation to the Company or the Selling Stockholders with respect to the offering contemplated hereby except
the obligations expressly set forth in this Agreement, (d) the Underwriters and their respective affiliates may be engaged in a
broad range of transactions that involve interests that differ from those of the Company and the Selling Stockholders, and (e)
the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby
and the Company and the Selling Stockholders have consulted their own legal, accounting, regulatory and tax advisors to the extent
they deemed appropriate.
Section 14.
Representations and Indemnities to Survive Delivery. The respective indemnities, agreements, representations,
warranties and other statements of the Company, of its officers, of the Selling Stockholders and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter or the Company or any of its or their partners, officers or directors or any controlling person, or the
Selling Stockholders, as the case may be, and, anything herein to the contrary notwithstanding, will survive delivery of and payment
for the Offered Shares sold hereunder and any termination of this Agreement.
Section 15.
Notices. All communications hereunder shall be in writing and shall be mailed, hand delivered or telecopied and confirmed
to the parties hereto as follows:
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If to the Representatives: |
Jefferies LLC |
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520 Madison Avenue |
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New York, New York 10022 |
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Facsimile: (646) 619-4437 |
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Attention: General Counsel |
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Leerink Partners LLC |
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299 Park Avenue, 21st Floor |
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New York, New York 10171 |
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Attention: Jack Fitzgerald |
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with a copy to: |
Covington & Burling LLP |
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620 Eighth Avenue |
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New York, New York 10018 |
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Facsimile: (646) 441-9101 |
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Attention: Donald J. Murray |
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If to the Company: |
Sucampo Pharmaceuticals, Inc. |
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4520 East West Highway, 3rd Floor |
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Bethesda, Maryland 20814 |
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Facsimile: (301) 961-3400 |
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Attention: Peter Greenleaf |
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with a copy to: |
Manatt, Phelps & Phillips, LLP, |
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695 Town Center Drive, 14th Floor |
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Costa Mesa, CA 92626 |
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Facsimile: (714) 371-2550 |
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Attention: |
Gordon M. Bava |
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Matthew S. O'Loughlin |
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If to the Selling Stockholders: |
S&R Technology Holdings, LLC |
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7501 Wisconsin Avenue, Suite 600E |
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Bethesda, MD 20814 |
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Attention: |
Dr. Sachiko Kuno |
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Kei Tolliver |
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Facsimile: (301) 961-3076 |
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with a copy to: |
McGuireWoods LLP |
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One James Center |
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901 East Cary Street |
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Richmond, VA 23219-4030 |
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Attention: |
Douglas W. Charnas |
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David N. Oakey |
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and to: |
American Stock Transfer & Trust Company, LLC |
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6201 15th Avenue |
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Brooklyn, NY 11219 |
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Any party hereto may change the address for receipt of communications
by giving written notice to the others.
Section 16.
Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto, including any
substitute Underwriters pursuant to Section 11 hereof, and to the benefit of the
affiliates, directors, officers, employees, agents and controlling persons referred to in Section
9 and Section 10, and in each case their respective successors, and personal representatives,
and no other person will have any right or obligation hereunder. The term “successors” shall not include any
purchaser of the Offered Shares as such from any of the Underwriters merely by reason of such purchase.
Section 17.
Partial Unenforceability. The invalidity or unenforceability of any section, paragraph or provision of this Agreement
shall not affect the validity or enforceability of any other section, paragraph or provision hereof. If any section, paragraph
or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such
minor changes (and only such minor changes) as are necessary to make it valid and enforceable.
Section 18.
Governing Law Provisions. This Agreement shall be governed by and construed in accordance with the internal laws
of the State of New York applicable to agreements made and to be performed in such state. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated hereby (“Related Proceedings”)
may be instituted in the federal courts of the United States of America located in the Borough of Manhattan in the City of New
York or the courts of the State of New York in each case located in the Borough of Manhattan in the City of New York (collectively,
the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings
instituted in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to which
such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice
or document by mail to such party’s address set forth above shall be effective service of process for any suit, action or
other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue
of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead
or claim in any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient
forum.
Section 19.
Failure of One or More of the Selling Stockholders to Sell and Deliver Offered Shares. If one or more of the Selling
Stockholders shall fail to sell and deliver to the Underwriters the Offered Shares to be sold and delivered by such Selling Stockholders
at the First Closing Date pursuant to this Agreement, then the Underwriters may at their option, by written notice from the Representatives
to the Company and the Selling Stockholders, either (i) terminate this Agreement without any liability on the part of any
Underwriter or, except as provided in Section 4, Section
7, Section 9 and Section 10 hereof,
the Company or the other Selling Stockholders, or (ii) purchase the shares which the other Selling Stockholders have agreed
to sell and deliver in accordance with the terms hereof. If one or more of the Selling Stockholders shall fail to sell and deliver
to the Underwriters the Offered Shares to be sold and delivered by such Selling Stockholders pursuant to this Agreement at the
First Closing Date or the applicable Option Closing Date, then the Underwriters shall have the right, by written notice from the
Representatives to the Company and the Selling Stockholders, to postpone the First Closing Date or the applicable Option Closing
Date, as the case may be, but in no event for longer than seven days in order that the required changes, if any, to the Registration
Statement and the Prospectus or any other documents or arrangements may be effected.
Section 20.
General Provisions. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes
all prior written or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject
matter hereof. This Agreement may be executed in two or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument. This Agreement may not be amended or modified unless
in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in writing by
each party whom the condition is meant to benefit. The section headings herein are for the convenience of the parties only and
shall not affect the construction or interpretation of this Agreement.
Each of the parties hereto acknowledges
that it is a sophisticated business person who was adequately represented by counsel during negotiations regarding the provisions
hereof, including, without limitation, the indemnification provisions of Section 9 and
the contribution provisions of Section 10, and is fully informed regarding said provisions.
Each of the parties hereto further acknowledges that the provisions of Section 9 and Section
10 hereof fairly allocate the risks in light of the ability of the parties to investigate the Company, its affairs and its business
in order to assure that adequate disclosure has been made in the Registration Statement, any preliminary prospectus, the Time of
Sale Prospectus, each free writing prospectus and the Prospectus (and any amendments and supplements to the foregoing), as contemplated
by the Securities Act and the Exchange Act.
If the foregoing is in accordance with your
understanding of our agreement, kindly sign and return to the Company and the Custodian the enclosed copies hereof, whereupon this
instrument, along with all counterparts hereof, shall become a binding agreement in accordance with its terms.
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Very truly yours, |
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SUCAMPO PHARMACEUTICALS, INC. |
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By: |
/s/ Thomas J. Knapp |
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Name: Thomas J. Knapp |
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Title: EVP, Chief Legal Officer and Corporate Secretary |
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ON BEHALF OF THE SELLING STOCKHOLDERS |
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By: |
/s/ Thomas J. Knapp |
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As Attorney-in-fact |
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Name: Thomas J. Knapp |
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The foregoing Underwriting Agreement is
hereby confirmed and accepted by the Representatives in New York, New York as of the date first above written.
JEFFERIES LLC
LEERINK PARTNERS LLC
Acting individually and as Representatives
of the several Underwriters named in
the attached Schedule A.
JEFFERIES LLC
By: |
/s/ Real Leclerc |
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Name: Real Leclerc |
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Title: Global Joint Head of Pharmaceuticals and Life Sciences |
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LEERINK PARTNERS LLC
By: |
/s/ John I. Fitzgerald |
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Name: John I. Fitzgerald |
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Title: Managing Director |
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Schedule A
Underwriters | |
Number of Firm Shares to be Purchased | |
Jefferies LLC | |
| 1,680,000 | |
Leerink Partners LLC | |
| 1,520,000 | |
Guggenheim Securities, LLC | |
| 800,000 | |
Total | |
| 4,000,000 | |
Schedule B
Selling
Stockholders | |
Number of Firm Shares to be Sold | | |
Maximum Number
of Optional Shares to be Sold | |
S&R Technology Holdings, LLC | |
| 586,113 | | |
| 600,000 | |
S&R Foundation | |
| 3,000,000 | | |
| 0 | |
Ryuji Ueno, M.D., Ph.D., Ph.D. | |
| 353,530 | | |
| 0 | |
Sachiko Kuno, Ph.D. | |
| 60,357 | | |
| 0 | |
Total: | |
| 4,000,000 | | |
| 600,000 | |
Schedule C
Free Writing Prospectuses Included
in the Time of Sale Prospectus
None
Exhibit C
Form of Lock-up Agreement
March ___, 2015
Jefferies LLC
Leerink Partners LLC
As Representatives of the Several Underwriters
c/o Jefferies LLC
520 Madison Avenue
New York, New York 10022
c/o Leerink Partners LLC
299 Park Avenue, 21st Floor
New York, New York 10171
RE: Sucampo Pharmaceuticals, Inc. (the “Company”)
Ladies & Gentlemen:
The undersigned is an owner of shares of class A common stock,
par value $0.01 per share, of the Company (“Shares”) or of securities convertible into or exchangeable or exercisable
for Shares. The Company proposes to conduct a public offering of Shares (the “Offering”) for which Jefferies
LLC (“Jefferies”), and Leerink Partners LLC will act as the representatives of the underwriters (in such capacity,
the “Representatives”). The undersigned recognizes that the Offering will benefit each of the Company, the selling
stockholders named in the Underwriting Agreement (the “Selling Stockholders”) and the undersigned. The undersigned
acknowledges that the underwriters are relying on the representations and agreements of the undersigned contained in this letter
agreement in conducting the Offering and, at a subsequent date, in entering into an underwriting agreement (the “Underwriting
Agreement”) and other underwriting arrangements with the Company and the Selling Stockholders with respect to the Offering.
Annex A sets forth definitions for capitalized terms used in
this letter agreement that are not defined in the body of this agreement. Those definitions are a part of this agreement.
In consideration of the foregoing, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned hereby agrees that, during the Lock-up
Period, the undersigned will not (and will cause any Family Member not to), without the prior written consent of the Representatives,
which may withhold its consent in its sole discretion:
| · | Sell or Offer to Sell any Shares or Related Securities currently or hereafter owned either of record or beneficially (as defined
in Rule 13d-3 under the Exchange Act) by the undersigned or such Family Member, |
| · | make any demand for, or exercise any right with respect to, the registration under the Securities Act of the offer and sale
of any Shares or Related Securities, or cause to be filed a registration statement, prospectus or prospectus supplement (or an
amendment or supplement thereto) with respect to any such registration, or |
| · | publicly announce any intention to do any of the foregoing. |
The foregoing will not apply to the registration of the offer
and sale of the Shares, and the sale of the Shares to the underwriters, in each case as contemplated by the Underwriting Agreement.
In addition, the foregoing restrictions shall not apply to the transfer of Shares or Related Securities by gift, or by will or
intestate succession to a Family Member or to a trust whose beneficiaries consist exclusively of one or more of the undersigned
and/or a Family Member; provided, however, that in any such case, it shall be a condition to such transfer that:
| · | each transferee executes and delivers to the Representatives an agreement in form and substance satisfactory to the Representatives
stating that such transferee is receiving and holding such Shares and/or Related Securities subject to the provisions of this letter
agreement and agrees not to Sell or Offer to Sell such Shares and/or Related Securities, engage in any Swap or engage in any other
activities restricted under this letter agreement except in accordance with this letter agreement (as if such transferee had been
an original signatory hereto), and |
| · | prior to the expiration of the Lock-up Period, no public disclosure or filing under the Exchange Act by any party to the transfer
(donor, donee, transferor or transferee) shall be required, or made voluntarily, reporting a reduction in beneficial ownership
of Shares in connection with such transfer. |
The undersigned acknowledges and agrees that
written notice by the Representatives to the Company of any extension of the 90-day initial lock-up period will be deemed to have
been given to, and received by, the undersigned. The undersigned further agrees that, prior to engaging in any transaction or taking
any other action that is subject to the terms of this letter agreement during the period from the date of this letter agreement
through the close of trading on the date that is the 34th day following the expiration of the 90-day initial lock-up period, the
undersigned will give notice thereof to the Company and will not consummate any such transaction or take any such action unless
the undersigned has received written confirmation from the Company that the Lock-Up Period has expired.
The undersigned also agrees and consents to the entry of stop
transfer instructions with the Company’s transfer agent and registrar against the transfer of Shares or Related Securities
held by the undersigned and the undersigned's Family Members, if any, except in compliance with the foregoing restrictions.
With respect to the Offering only, the undersigned waives any
registration rights relating to registration under the Securities Act of the offer and sale of any Shares and/or any Related Securities
owned either of record or beneficially by the undersigned, including any rights to receive notice of the Offering.
The undersigned confirms that the undersigned has not, and has
no knowledge that any Family Member has, directly or indirectly, taken any action designed to or that might reasonably be expected
to cause or result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale of the
Shares. The undersigned will not, and will cause any Family Member not to take, directly or indirectly, any such action.
Whether or not the Offering occurs as currently contemplated
or at all depends on market conditions and other factors. The Offering will only be made pursuant to the Underwriting Agreement,
the terms of which are subject to negotiation between the Company, the Selling Stockholders and the underwriters.
The undersigned hereby represents and warrants that the undersigned
has full power, capacity and authority to enter into this letter agreement. This letter agreement is irrevocable and will be binding
on the undersigned and the successors, heirs, personal representatives and assigns of the undersigned.
This letter agreement shall lapse and become null and void,
and the undersigned shall be released from all obligations under this letter agreement, if the Underwriting Agreement is not executed
on or before May 12, 2015, or if the Underwriting Agreement (other than the provisions thereof that survive termination) shall
terminate or be terminated prior to payment for, and delivery of, the Firm Shares (as defined therein) to be sold thereunder.
This letter agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
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Printed Name of Person Signing |
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(Indicate capacity of person signing if
signing as custodian or trustee, or on behalf
of an entity)
Certain Defined Terms
Used in Lock-up
Agreement
For purposes of the letter agreement to which this Annex A is
attached and of which it is made a part:
| · | “Call Equivalent Position” shall have the meaning set forth in Rule 16a-1(b) under the Exchange Act. |
| · | “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. |
| · | “Family Member” shall mean the spouse of the undersigned, an immediate family member of the undersigned
or an immediate family member of the undersigned's spouse, in each case living in the undersigned's household or whose principal
residence is the undersigned's household (regardless of whether such spouse or family member may at the time be living elsewhere
due to educational activities, health care treatment, military service, temporary internship or employment or otherwise). “Immediate
family member” as used above shall have the meaning set forth in Rule 16a-1(e) under the Exchange Act. |
| · | “Lock-up Period” shall mean the period beginning on the date hereof and continuing through the close of
trading on the date that is 90 days after the date of the Prospectus (as defined in the Underwriting Agreement); provided,
that if (i) during the last 17 days of the 90-day initial lock-up period, the Company issues an earnings release or discloses material
news or a material event relating to the Company occurs or (ii) prior to the expiration of such period, the Company announces that
it will release earnings results during the 16-day period beginning on the last day of such period, then, in each case, the Lock-up
Period will be extended until the expiration of the 18-day period beginning on the date of the issuance of the earnings release
or the disclosure of the material news or occurrence of the material event, as applicable, unless the Representatives waive, in
writing, such extension. If the initial lock-up period is extended pursuant to the provisions above, “Lock-up Period”
shall mean the period described in the first clause of this paragraph, as so extended. |
| · | “Put Equivalent Position” shall have the meaning set forth in Rule 16a-1(h) under the Exchange Act. |
| · | “Related Securities” shall mean any options or warrants or other rights to acquire Shares or any securities
exchangeable or exercisable for or convertible into Shares, or to acquire other securities or rights ultimately exchangeable or
exercisable for or convertible into Shares. |
| · | “Securities Act” shall mean the Securities Act of 1933, as amended. |
| · | “Sell or Offer to Sell” shall mean to: |
| – | sell, offer to sell, contract to sell or lend, |
| – | effect any short sale or establish or increase a Put Equivalent Position or liquidate or decrease any Call Equivalent Position |
| – | pledge, hypothecate or grant any security interest in, or |
| – | in any other way transfer or dispose of, |
in each case whether effected
directly or indirectly.
| · | “Swap” shall mean any swap, hedge or similar arrangement or agreement that transfers, in whole or in part,
the economic risk of ownership of Shares or Related Securities, regardless of whether any such transaction is to be settled in
securities, in cash or otherwise. |
Capitalized terms not defined in this Annex A shall have the
meanings given to them in the body of this lock-up agreement.
Exhibit 99.1
Sucampo Prices Public Offering of Common Stock by Selling Stockholders
BETHESDA, Md., March 26, 2015 (GLOBE NEWSWIRE) -- Sucampo Pharmaceuticals,
Inc. (Sucampo) (Nasdaq:SCMP), a global biopharmaceutical company, today announced the pricing of an underwritten public offering
of 4,000,000 shares of its class A common stock by selling stockholders, offered at a price to the public of $14.00 per share for
an aggregate offering of $56.0 million of class A common stock. All shares will be offered by S&R Technology Holdings, LLC,
S&R Foundation, Dr. Sachiko Kuno and Dr. Ryuji Ueno. Sucampo will not sell any shares or receive any proceeds from the
offering. The underwriters have been granted a 30-day option to purchase up to an aggregate of 600,000 additional shares of class
A common stock. The offering is expected to close on or about March 31, 2015, subject to customary closing conditions.
Jefferies LLC and Leerink Partners LLC are acting as joint book-running
managers for the offering. Guggenheim Securities, LLC is acting as co-manager.
A shelf registration statement on Form S-3 (including a prospectus)
and a preliminary prospectus supplement related to the offering has been filed with the SEC. A final prospectus supplement related
to the offering will be filed with the SEC and will be available on the SEC's website located at http://www.sec.gov. Copies of
the preliminary and final prospectus supplement and the accompanying prospectus relating to this offering may be obtained from
Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, 12th Floor, New York, NY 10022, via telephone
at 877-547-6340 or by email to Prospectus_Department@Jefferies.com, or from Leerink Partners LLC, Attention: Syndicate Department,
One Federal Street, 37th Floor, Boston, MA 02110, via telephone at 800-808-7525, ext. 6142 or by email to syndicate@leerink.com.
This press release shall not constitute an offer to sell or
the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction
in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws
of any such state or other jurisdiction.
About Sucampo Pharmaceuticals, Inc.
Sucampo Pharmaceuticals, Inc. is focused on the development
and commercialization of medicines that meet major unmet medical needs of patients worldwide. Sucampo has one marketed product
– AMITIZA® – and a pipeline of drug candidates in clinical development. A global company, Sucampo is
headquartered in Bethesda, Maryland, and has operations in Japan, Switzerland and the United Kingdom.
The Sucampo logo is the registered trademark and the tagline,
The Science of Innovation, is a registered trademark of Sucampo AG. AMITIZA is a registered trademark of Sucampo AG.
Sucampo Forward-Looking Statement
This press release contains "forward-looking statements"
as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management's current
expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements.
The forward-looking statements may include statements regarding market conditions and expectations with respect to the proposed
offering.
No forward-looking statement can be guaranteed and actual results
may differ materially from those projected. Sucampo undertakes no obligation to publicly update any forward-looking statement,
whether as a result of new information, future events, or otherwise. Forward-looking statements in this press release should be
evaluated together with the many uncertainties that affect Sucampo's business, particularly those mentioned in the risk factors
and cautionary statements in Sucampo's most recent Annual Report on Form 10-K as filed with the Securities and Exchange Commission
on March 9, 2015 as well as its filings with the Securities and Exchange Commission on Form 10-Q and 8-K and as also contained
in the above-referenced prospectus, preliminary prospectus supplement and final prospectus supplement.
CONTACT: Company Contact: |
Silvia Taylor |
SVP, Investor Relations and |
Corporate Communications |
1-240-223-3718 |
staylor@sucampo.com |
Sucampo Pharmaceuticals, Inc.
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