Exhibit 1.1
3,995,000 Shares
599,250 Overallotment Shares
NETLIST, INC.
Common Stock
(par value $0.001 per share)
UNDERWRITING AGREEMENT
March 19, 2010
NEEDHAM &
COMPANY, LLC
ROTH
CAPITAL PARTNERS LLC
c/o
Needham & Company, LLC
445
Park Avenue
New
York, New York 10022
Ladies
and Gentlemen:
Netlist, Inc., a
Delaware corporation (the
Company
),
proposes to issue and sell 3,995,000 shares (the
Firm Shares
) of the Companys Common Stock, $0.001 par value
per share (the
Common Stock
), to
Needham & Company, LLC and Roth Capital Partners LLC (collectively,
the
Underwriters
), for whom
Needham & Company, LLC is acting as the representative (the
Representative
). The Company has also agreed to grant to you
and the other Underwriters an option (the
Option
)
to purchase up to an additional 599,250 shares of Common Stock, on the terms
and for the purposes set forth in
Section 1(b)
(the
Option Shares
). The Firm Shares and the Option Shares are
referred to collectively herein as the
Shares
.
The
Company confirms as follows its agreements with the Underwriters.
1.
Agreement to Sell and Purchase.
(a)
On the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions of this Agreement, (i) the Company
agrees to issue and sell the Firm Shares to the several Underwriters and (ii) each
of the Underwriters, severally and not jointly, agrees to purchase from the
Company the respective number of Firm Shares set forth opposite that Underwriters
name in Schedule I hereto, at the purchase price of $3.629 for each Firm
Share (
Purchase Price
).
(b)
Subject to all the terms and
conditions of this Agreement, the Company grants the Option to the several
Underwriters to purchase, severally and not jointly, up to 599,250 Option
Shares at the Purchase Price. The Option
may be exercised only to cover over-allotments in the sale of the Firm Shares
by the Underwriters and may be exercised in whole or in part at any time
on or before the 30th day
after the date of this Agreement upon notice, which notice may be in electronic
form (the
Option Shares Notice
)
by the Representative to the Company no later than 12:00 noon, New York
City time, at least two and no more than five business days before the date
specified for closing in the Option Shares Notice (the
Option Closing Date
), setting forth the
aggregate number of Option Shares to be purchased and the time and date for
such purchase. On the Option Closing
Date, the Company will issue and sell to the Underwriters the number of Option
Shares set forth in the Option Shares Notice, and each Underwriter will
purchase such percentage of the Option Shares as is equal to the percentage of
Firm Shares that such Underwriter is purchasing, as adjusted by the
Representative in such manner as they deem advisable to avoid fractional
shares.
2.
Delivery
and Payment.
Delivery of the
Firm Shares shall be made to or as instructed by the Representative for the
accounts of the several Underwriters in a form reasonably acceptable to the
Representative against payment by the Underwriters of the purchase price by
wire transfer payable in same-day funds to the order of the Company at the
office of Needham & Company, LLC, 445 Park Avenue, New York, New
York 10022, at 10:00 a.m., New York City time, on the third (or, if the
purchase price set forth in
Section 1(a)
hereof is determined
after 4:30 p.m., New York City time, the fourth) business day after the
date of this Agreement, or at such time on such other date, not later than
seven business days after the date of this Agreement, as may be agreed upon by
the Company and the Representative (such date is hereinafter referred to as the
Closing Date
).
To the extent the Option is
exercised, delivery of the Option Shares against payment by the Underwriters
(in the manner specified above) will take place at the offices specified above
for the Closing Date at the time and date (which may be the Closing Date, but
not earlier) specified in the Option Shares Notice.
The Shares shall be in
definitive form and shall be registered in such names and in such denominations
as the Representative shall request at least two business days prior to the
Closing Date or the Option Closing Date, as the case may be, by written notice
to the Company, and shall be delivered by or on behalf of the Company as
instructed by the Representative through the facilities of The Depository Trust
Company (
DTC
).
The cost of original issue
tax stamps and other transfer taxes, if any, in connection with the issuance
and delivery of the Firm Shares and Option Shares by the Company to the
respective Underwriters shall be borne by the Company. The Company will pay and save each
Underwriter and any subsequent holder of the Shares harmless from any and all
liabilities with respect to or resulting from any failure or delay in paying
federal and state stamp and other transfer taxes, if any, which may be payable
or determined to be payable in connection with the original issuance or sale to
such Underwriter of the Shares.
3.
Representations
and Warranties of the Company.
The Company
represents, warrants and covenants to each Underwriter that:
(a)
The Company meets the
requirements for the use of Form S-3, a registration statement
(Registration No. 333-164290) on Form S-3 relating to the Shares,
including a base prospectus relating to the Shares (the
Base Prospectus
) and such amendments
thereto as may
have been required to the
date of this Agreement, has been prepared by the Company under the provisions
of the Securities Act of 1933, as amended (the
Act
), and the rules and regulations (collectively
referred to as the
Rules and
Regulations
) of the Securities and Exchange Commission (the
Commission
) thereunder, has been filed
with the Commission, and has been declared effective by the Commission, and the
offering of the Shares complies with Rule 415 under the Act. A final prospectus supplement to the Base
Prospectus relating to the Shares and the offering thereof will be filed
promptly by the Company with the Commission in accordance with Rule 424(b) of
the Rules and Regulations (such final prospectus supplement, as so filed,
the
Prospectus Supplement
). Such registration statement at any given
time, including the amendments thereto to such time, the exhibits and any
schedules thereto at such time, the documents otherwise deemed to be a part
thereof or included therein by the Rules and Regulations (including Rule 430B
thereof), and any registration statement relating to the offering contemplated
by this Agreement and filed pursuant to Rule 462(b) of the Rules and
Regulations (
Rule 462(b)
),
is herein called the
Registration Statement
. The term
preliminary
prospectus
means any preliminary prospectus (including any
preliminary prospectus supplement) relating to the Shares and the offering
thereof as first filed with the Commission pursuant to Rule 424(b) of
the Rules and Regulations (
Rule 424(b)
). The term
Prospectus
means the Base Prospectus together with the Prospectus Supplement, except that
if such Base Prospectus is amended or supplemented on or prior to the date on
which the Prospectus Supplement was first filed pursuant to Rule 424(b),
the term
Prospectus
shall mean
the Base Prospectus as so amended or supplemented and as supplemented by the
Prospectus Supplement. Any reference
herein to the Registration Statement, the Base Prospectus, a preliminary
prospectus, the Prospectus Supplement, or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein, and any
reference herein to the terms amend, amendment or supplement with respect
to the Registration Statement, the Base Prospectus, a preliminary prospectus,
the Prospectus Supplement, or the Prospectus shall be deemed to refer to and
include the filing of any document under the Securities Exchange Act of 1934,
as amended (the
Exchange Act
),
after the time the Registration Statement initially became effective (the
Effective Date
), the date of the Base
Prospectus, any preliminary prospectus, the Prospectus Supplement, or the
Prospectus, as the case may be, and deemed to be incorporated therein by
reference. The term
Issuer Free Writing Prospectus
means any
issuer free writing prospectus
, as defined
in Rule 433 of the Rules and Regulations (
Rule 433
), relating to the Shares that (i) is
required to be filed with the Commission by the Company or (ii) is exempt
from filing pursuant to Rule 433(d)(5)(i) because it contains a
description of the Shares or of the offering that does not reflect the final
terms, in each case in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the Companys
records pursuant to Rule 433(g).
(b)
No order preventing or
suspending the use of the Base Prospectus, any preliminary prospectus, the
Prospectus Supplement, the Prospectus or any Issuer Free Writing Prospectus has
been issued by the Commission, and no stop order suspending the effectiveness
of the Registration Statement (including any related registration statement
filed pursuant to Rule 462(b)) or any post-effective amendment thereto has
been issued, and, to the Companys knowledge, no proceeding for that purpose
has been initiated or threatened by the Commission. On the Effective Date, on the date the Base
Prospectus, any preliminary prospectus, the Prospectus Supplement, or the
Prospectus is first filed with the Commission pursuant to Rule 424(b) (if
required), at all times during the period through and including the Closing
Date and, if
later, the Option Closing
Date and when any post-effective amendment to the Registration Statement
becomes effective or any amendment or supplement to the Prospectus is filed
with the Commission, the Registration Statement and the Prospectus (as amended
or as supplemented if the Company shall have filed with the Commission any
amendment or supplement thereto), including the financial statements included
or incorporated by reference in the Prospectus, did and will comply with all
applicable provisions of the Act, the Exchange Act, the rules and
regulations of the Commission under the Exchange Act (the
Exchange Act Rules and Regulations
),
and the Rules and Regulations and will contain all statements required to
be stated therein in accordance with the Act, the Exchange Act, the Exchange
Act Rules and Regulations, and the Rules and Regulations. As of the applicable effective date as to
each part of the Registration Statement, no part of the Registration Statement,
the Prospectus or any such amendment or supplement thereto did or will contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading. At the Effective
Date, the date the Base Prospectus or any amendment or supplement to the Base
Prospectus, including any preliminary prospectus or the Prospectus Supplement,
is filed with the Commission, the date of first use of any preliminary
prospectus or the Prospectus Supplement, and at the Closing Date and, if later,
the Option Closing Date, the Prospectus did not and 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.
As of the Applicable Time,
neither (x) the Issuer General Use Free Writing Prospectus(es) (as defined
below) issued at or prior to the Applicable Time (as defined below), the Pricing Prospectus
(as defined below), all considered together (collectively, the
General Disclosure Package
), nor (y) any
individual Issuer Limited Use Free Writing Prospectus, when considered together
with the General Disclosure Package, included any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.
As used in this subsection
and elsewhere in this Agreement:
Applicable Time
means 9:00 a.m. (Eastern time) on March 19,
2010 or such other time as agreed by the Company and Needham &
Company, LLC.
Issuer General Use Free Writing Prospectus
means any Issuer
Free Writing Prospectus that is intended for general distribution to
prospective investors, as evidenced by its being specified in Schedule II
hereto.
Issuer Limited Use Free Writing Prospectus
means any Issuer
Free Writing Prospectus that is not an Issuer General Use Free Writing
Prospectus.
Pricing Prospectus
means the Base Prospectus, as amended or
supplemented immediately prior to the Applicable Time, including any document
incorporated by reference therein and any prospectus supplement deemed to be a
part thereof. For purposes of this
definition, information contained in a form of prospectus that is deemed
retroactively to be a part of the Registration Statement pursuant to Rule 430B
shall be considered to be included in the
Pricing
Prospectus only if the actual time that form of prospectus is filed with the
Commission pursuant to Rule 424(b) is prior to the Applicable Time.
Each Issuer Free Writing
Prospectus, as of its issue date and at all subsequent times through the
completion of the public offer and sale of the Shares or until any earlier date
that the issuer notified or notifies Needham & Company, LLC as
described in the next sentence, did not, does not and will not include any
information that conflicted, conflicts or will conflict with the information
contained in the Registration Statement or the Prospectus, including any
document incorporated by reference therein that has not been superseded or
modified. If there occurs an event or
development as a result of which the General Disclosure Package would include
an untrue statement of a material fact or would omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances then prevailing, not misleading, the Company will promptly notify
the Representative so that any use of the General Disclosure Package may cease
until it is amended or supplemented to correct untrue statement or omission.
The foregoing
representations and warranties in this Section 3(b) do not apply to
any statements or omissions made in reliance on and in conformity with
information relating to any Underwriter furnished in writing to the Company by
the Representative specifically for inclusion in the Registration Statement,
the Prospectus Supplement, the Pricing Prospectus, the Prospectus or any Issuer
Free Writing Prospectus or any amendment or supplement thereto. The Company acknowledges that the statements
set forth in the first, fourth, tenth, eleventh (price stabilization) and
fourteenth through eighteenth paragraphs under the heading Underwriting in
the Pricing Prospectus and the Prospectus constitute the only information
relating to any Underwriter furnished in writing to the Company by the
Representative specifically for inclusion in the Registration Statement, the
Prospectus Supplement, the Pricing Prospectus, the Prospectus and any Issuer
Free Writing Prospectus.
(c)
(i) At the earliest
time after the filing of the Registration Statement that the Company or another
offering participant made a
bona fide
offer (within the meaning of Rule 164(h)(2) of the Rules and
Regulations) of the Shares and (ii) as of the date hereof, the Company was
not and is not an Ineligible Issuer (as defined in Rule 405 of the Rules and
Regulations (
Rule 405
)),
without taking account of any determination by the Commission pursuant to Rule 405
that it is not necessary that the Company be considered an Ineligible Issuer.
(d)
The documents that are
incorporated by reference in the Base Prospectus, any preliminary prospectus,
the Pricing Prospectus and the Prospectus or from which information is so
incorporated by reference, when they became or become effective or were or are
filed with the Commission, as the case may be, complied or will comply in all
material respects with the requirements of the Act or the Exchange Act, as
applicable, and the Rules and Regulations or the Exchange Act Rules and
Regulations, as applicable; and any documents so filed and incorporated by
reference subsequent to the Effective Date shall, when they are filed with the
Commission, comply in all material respects with the requirements of the Act or
the Exchange Act, as applicable, and the Rules and Regulations or the
Exchange Act Rules and Regulations, as applicable. No such documents were filed with the
Commission since the Commissions close of business on the business day
immediately prior to the date of this Agreement and prior to the execution of
this Agreement.
(e)
The Company does not own,
directly or indirectly, any shares of stock or any other equity or long-term
debt securities of any corporation or have any equity interest in any
corporation, firm, partnership, joint venture, association or other entity,
other than the subsidiaries listed in Exhibit 21.1 to the Companys Annual
Report on Form 10-K for the fiscal year ended January 2, 2010 (the
Subsidiaries
). The Company and each of its Subsidiaries is a
business entity duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, have full power and authority to
conduct all the activities conducted by it, to own or lease all the assets
owned or leased by it and to conduct its business as described in the
Registration Statement, the Pricing Prospectus and the Prospectus, and are duly licensed or qualified to do
business and in good standing as a foreign corporation in all jurisdictions in
which the nature of the activities conducted by it or the character of the
assets owned or leased by it makes such license or qualification necessary,
except to the extent that the failure to be so qualified or be in good standing
or have such power or authority would not materially and adversely affect the
Company and its Subsidiaries, taken as a whole, or their respective businesses,
properties, business prospects, conditions (financial or other) or results of
operations, taken as a whole (such effect is referred to herein as a
Material Adverse Effect
). All of the outstanding equity interests of
each Subsidiary have been duly authorized and validly issued and are fully paid
and nonassessable, and owned by the Company free and clear of all claims,
liens, charges and encumbrances, other than the continuing security interest in
the equity interests existing on the date hereof in connection with the Loan
and Security Agreement, by and between Silicon Valley Bank, a California
corporation, and the Company, dated as of October 31, 2009; there are no
securities outstanding that are convertible into or exercisable or exchangeable
for capital stock of any Subsidiary. The
Company and its Subsidiaries are not engaged in any discussions or a party to
any agreement or understanding, written or oral, regarding the acquisition of
an interest in any corporation, firm, partnership, joint venture, association
or other entity where such discussions, agreements or understandings would
require amendment to the Registration Statement pursuant to applicable
securities laws. Complete and correct
copies of the certificate of incorporation and of the by-laws of the Company
and each of its Subsidiaries and all amendments thereto have been made
available to the Representative, and no changes therein will be made subsequent
to the date hereof and prior to the Closing Date or, if later, the Option
Closing Date.
(f)
The Company has authorized,
issued and outstanding capital stock as set forth under the caption Capitalization
in the Pricing Prospectus and the Prospectus as of the respective dates set
forth therein. All of the outstanding
shares of capital stock of the Company have been duly authorized, validly
issued and are fully paid and nonassessable and were issued in compliance with
all applicable state and federal securities laws; the Firm Shares and the
Option Shares have been duly authorized and when issued and paid for as
contemplated herein will be validly issued, fully paid and nonassessable; no
preemptive or similar rights exist with respect to any of the Shares or the
issue and sale thereof. The description
of the capital stock of the Company incorporated by reference in the
Registration Statement, the Pricing Prospectus and the Prospectus is complete
and accurate in all respects. Except as
set forth in the Pricing Prospectus and the Prospectus, the Company does not
have outstanding and, at the Closing Date, will not have outstanding, any
options to purchase, or any rights or warrants to subscribe for, or any
securities or obligations convertible into, or any contracts or commitments to
issue or sell, any shares of capital stock, or any such warrants, convertible
securities or obligations. No further
approval or authority of stockholders or the Board of Directors of the Company
will be
required for the issuance
and sale of the Shares as contemplated herein.
The Offering and the terms hereunder and thereunder comply with the
instructions set forth in I.B.6 of Form S-3. The certificates evidencing the Shares are in
due and proper legal form and have been duly authorized for issuance by the
Company.
(g)
The financial statements and
schedules included or incorporated by reference in the Registration Statement,
the Pricing Prospectus or the Prospectus present fairly the financial condition
of the Company and its consolidated Subsidiaries as of the respective dates
thereof and the results of operations and cash flows of the Company and its
consolidated Subsidiaries for the respective periods covered thereby, all in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the entire period involved, except as otherwise
disclosed in the Pricing Prospectus or the Prospectus. KMJ Corbin & Company LLP (the
Accountants
), who have reported on such
financial statements and schedules, are independent accountants with respect to
the Company as required by the Act and the Rules and Regulations and Rule 3600T
of the Public Company Accounting Oversight Board (
PCAOB
). The summary
and selected consolidated financial and statistical data included in the
Registration Statement, the Pricing Prospectus and the Prospectus present
fairly the information shown therein and have been compiled on a basis
consistent with the audited financial statements incorporated by reference in
the Registration Statement, the Pricing Prospectus and the Prospectus. All disclosures contained in the Registration
Statement or the General Disclosure Package regarding non-GAAP financial
measures (as such term is defined in the Rules and Regulations) comply
with Regulation G of the Exchange Act and Item 10 of Regulation S-K under the
Act, to the extent applicable.
(h)
Subsequent to the respective
dates as of which information is given in the Registration Statement, the
Pricing Prospectus and the Prospectus and prior to or on the Closing Date and,
except as set forth in or contemplated by the Registration Statement, the
Pricing Prospectus and the Prospectus, (i) there has not been and will not
have been any change in the capitalization of the Company (other than in
connection with the exercise of options to purchase the Companys Common Stock
granted pursuant to the Companys stock option plans from the shares reserved
therefor as described in the Registration Statement, the Pricing Prospectus and
the Prospectus and the grant of employee stock options consistent with the past
practice of the Company), or any Material Adverse Effect arising for any reason
whatsoever, (ii) neither the Company nor any of its Subsidiaries has
incurred nor will any of them incur, except in the ordinary course of business
as described in the Pricing Prospectus and the Prospectus, any material
liabilities or obligations, direct or contingent, nor has the Company or any of
its Subsidiaries entered into nor will it enter into, except in the ordinary
course of business as described in the Pricing Prospectus and the Prospectus,
any material transactions other than pursuant to this Agreement and the
transactions referred to herein and (iii) the Company has not and will not
have paid or declared any dividends or other distributions of any kind on any
class of its capital stock.
(i)
Neither the Company nor any
of its Subsidiaries is or will become as a result of the transactions
contemplated hereby, an investment company or an entity controlled by an investment
company, as such terms are defined in the Investment Company Act of 1940, as
amended.
(j)
Except as set forth in the
Registration Statement, the Pricing Prospectus and the Prospectus, there are no
actions, suits or proceedings pending or, to the knowledge of the Company,
threatened against or affecting the Company, or any of its Subsidiaries or any
of its or their officers in their capacity as such, nor any basis therefor,
before or by any federal or state court, commission, regulatory body,
administrative agency or other governmental body, domestic or foreign, wherein
an unfavorable ruling, decision or finding might have a Material Adverse
Effect.
(k)
The Company and each
Subsidiary has, and at the Closing Date and, if later, the Option Closing Date,
will have, performed all the obligations required to be performed by it, and is
not, and at the Closing Date, and, if later, the Option Closing Date, will not
be, in default, under any contract or other instrument to which it is a party
or by which its property is bound or affected, which default could have a
Material Adverse Effect. To the
knowledge of the Company, no other party under any contract or other instrument
to which it or any of its Subsidiaries is a party is in default in any respect
thereunder, which default might have a Material Adverse Effect. Neither the Company nor any of its
Subsidiaries is, and at the Closing Date and, if later, the Option Closing
Date, will not be, in violation of any provision of its certificate or articles
of organization or by-laws or other organizational documents.
(l)
No consent, approval,
authorization or order of, or any filing or declaration with, any court or
governmental agency or body is required for the consummation by the Company of
the transactions on its part contemplated herein, except such as have been
obtained under the Act or the Rules and Regulations and such as may be
required under state securities or Blue Sky laws or the by-laws and rules of
the Financial Industry Regulatory Authority, Inc. (
FINRA
) or the listing requirements of the
NASDAQ Global Market (
NGM
) in
connection with the purchase and distribution by the Underwriters of the
Shares.
(m)
The Company has full
corporate power and authority to enter into this Agreement. This Agreement has been duly authorized,
executed and delivered by the Company.
The performance of this Agreement and the consummation of the
transactions contemplated hereby will not result in the creation or imposition
of any lien, charge or encumbrance upon any of the assets of the Company
pursuant to the terms or provisions of, or result in a breach or violation of
any of the terms or provisions of, or conflict with or constitute a default
under, or give any party a right to terminate any of its obligations under, or
result in the acceleration of any obligation under, (i) the certificate or
articles of incorporation or by-laws of the Company or any of its Subsidiaries,
(ii) any indenture, mortgage, deed of trust, voting trust agreement, loan
agreement, bond, debenture, note agreement or other evidence of indebtedness,
lease, contract or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which the Company, any of its Subsidiaries or
any of its or their properties is bound or affected, or (iii) any
judgment, ruling, decree, order, statute, rule or regulation of any court
or other governmental agency or body applicable to the business or properties
of the Company or any of its Subsidiaries, except as to (ii) and (iii) above
for such breaches, violations or defaults which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.
(n)
The Company and its
Subsidiaries have good and marketable title to all properties and assets
described in the Pricing Prospectus and the Prospectus as owned by them, free
and
clear of all liens, charges,
encumbrances or restrictions, except such as are described in the Pricing
Prospectus and the Prospectus or those that would not, individually or in the
aggregate materially negatively affect the value of such property or assets and
do not materially interfere with the use made and proposed to be made of such
property or assets by the Company or its Subsidiaries. The Company and its Subsidiaries have valid,
subsisting and enforceable leases for the properties described in the Pricing
Prospectus and the Prospectus as leased by them. The Company and its Subsidiaries own or lease
all such properties as are necessary to their operations as now conducted or as
proposed to be conducted, except where the failure to so own or lease would not
have a Material Adverse Effect.
(o)
There is no document,
contract, permit or instrument, affiliate transaction or off-balance sheet transaction
(including, without limitation, any variable interests in variable interest
entities, as such terms are defined in Financial Accounting Standards Board
Interpretation No. 46) of a character required to be described in the
Registration Statement, the Pricing Prospectus or the Prospectus or to be filed
as an exhibit to the Registration Statement that is not described or filed as
required. All such contracts to which
the Company or any of its Subsidiaries is a party have been duly authorized,
executed and delivered by the Company or such Subsidiary, constitute valid and
binding agreements of the Company or such Subsidiary and are enforceable
against and by the Company or such Subsidiary in accordance with the terms
thereof.
(p)
No statement, representation,
warranty or covenant made by the Company in this Agreement or made in any
certificate or document required by
Section 5
of this Agreement to
be delivered to the Representative was or will be, when made, inaccurate,
untrue or incorrect.
(q)
The Company has not
distributed and will not distribute prior to the later of (i) the Closing
Date or, if later, the Option Closing Date, and (ii) completion of the
distribution of the Shares, any offering material in connection with the
offering and sale of the Shares other than any preliminary prospectuses, the
Prospectus, the Registration Statement, any Issuer Free Writing Prospectus
listed in Schedule II hereto, and other materials, if any, permitted by the Act
and the Rules and Regulations.
Neither the Company nor, to the Companys knowledge, any of its
directors, officers or controlling persons has taken, directly or indirectly,
any action designed, or that might reasonably be expected, to cause or result,
under the Act or otherwise, in, or that has constituted, stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
(r)
No holder of securities of
the Company has rights to the registration of any securities of the Company
because of the filing of the Registration Statement, which rights have not been
waived by the holder thereof as of the date hereof.
(s)
The Shares are registered
under Section 12(b) of the Exchange Act and the Company has filed an
application to list the Shares on the NGM, and to its knowledge, has no reason
to believe that such application will not be approved, subject to notice of
issuance of the Shares.
(t)
Except as disclosed in or
specifically contemplated by the Pricing Prospectus and the Prospectus (i) the
Company and each of its Subsidiaries owns or has adequate rights to use
all material trademarks,
trade names, domain names, patents, patent rights, copyrights, technology,
know-how (including trade secrets and other unpatented or unpatentable
proprietary or confidential information, systems or procedures), service marks,
trade dress rights, and other intellectual property (collectively,
Intellectual Property
) and has such other
licenses, approvals and governmental authorizations, in each case, sufficient
to conduct its business as now conducted and as now proposed to be conducted,
and, to the Companys knowledge, none of the foregoing Intellectual Property
rights owned or licensed by the Company or any of its Subsidiaries is invalid
or unenforceable, (ii) the Company has no knowledge of any infringement by
it or any of its Subsidiaries of Intellectual Property rights of others, where
such infringement could have a Material Adverse Effect, (iii) the Company
is not aware of any infringement, misappropriation or violation by others of,
or conflict by others with rights of the Company or any of its Subsidiaries
with respect to, any Intellectual Property, (iv) there is no claim being
made against the Company or any of its Subsidiaries or, to the knowledge of the
Company and its Subsidiaries, any employee of the Company or any of its
Subsidiaries, regarding Intellectual Property or other infringement that could
have a Material Adverse Effect, and (v) the Company and its Subsidiaries
have not received any notice of infringement with respect to any patent or any
notice challenging the validity, scope or enforceability of any Intellectual
Property owned by or licensed to the Company or any of its Subsidiaries, in
each case the loss of which patent or Intellectual Property (or loss of rights
thereto) would have a Material Adverse Effect.
(u)
The Company and each of its
Subsidiaries has filed all federal, state, local and foreign income tax returns
that have been required to be filed and has paid all taxes and assessments received
by it to the extent that such taxes or assessments have become due. Neither the Company nor any of its
Subsidiaries has any tax deficiency that has been or, to the knowledge of the
Company, might be asserted or threatened against it that could have a Material
Adverse Effect.
(v)
The Company or its
Subsidiaries owns or possesses all authorizations, approvals, orders, licenses,
registrations, other certificates and permits of and from all governmental
regulatory officials and bodies, necessary to conduct their respective
businesses as contemplated in the Pricing Prospectus and the Prospectus, except
where the failure to own or possess all such authorizations, approvals, orders,
licenses, registrations, other certificates and permits would not have a Material
Adverse Effect. There is no proceeding
pending or threatened (or any basis therefor known to the Company) that may
cause any such authorization, approval, order, license, registration,
certificate or permit to be revoked, withdrawn, cancelled, suspended or not
renewed; and the Company and each of its Subsidiaries is conducting its
business in compliance with all laws, rules and regulations applicable
thereto (including, without limitation, all applicable federal, state and local
environmental laws and regulations) except where such noncompliance would not
have a Material Adverse Effect.
(w)
The Company and each of its
Subsidiaries maintains insurance of the types and in the amounts generally
deemed adequate for its business, including, but not limited to, insurance
covering real and personal property owned or leased by the Company and its
Subsidiaries against theft, damage, destruction, acts of vandalism and all
other risks customarily insured against, all of which insurance is in full
force and effect.
(x)
Neither the Company nor any
of its Subsidiaries has nor, to the Companys knowledge, any of its or their
respective directors, officers, employees or agents at any time during the last
five years (i) made any unlawful contribution to any candidate for foreign
office, or failed to disclose fully any contribution in violation of law, or (ii) made
any payment to any federal or state governmental officer or official, or other
person charged with similar public or quasi-public duties, other than payments
required or permitted by the laws of the United States or any jurisdiction
thereof.
(y)
The books, records and
accounts of the Company and its Subsidiaries accurately and fairly reflect, in
reasonable detail, the transactions in, and dispositions of, the assets of, and
the results of operations of, the Company and its Subsidiaries. The Company and each of its Subsidiaries
maintains a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
managements general or specific authorization, (ii) transactions are
recorded as necessary to permit preparation of the Companys consolidated
financial statements in accordance with generally accepted accounting
principles and to maintain asset accountability, (iii) access to assets is
permitted only in accordance with managements general or specific
authorization, and (iv) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
The Companys internal control over financial reporting is effective and
the Company is not aware of any material weaknesses in its internal control
over financial reporting. Since the date
of the latest audited financial statements incorporated by reference in the
Pricing Prospectus and the Prospectus, there has been no change in the Companys
internal control over financial reporting that has materially affected, or is
reasonably likely to materially affect, the Companys internal control over
financial reporting.
(z)
The Company maintains disclosure
controls and procedures (as defined in Rule 13a-14(c) under the
Exchange Act); such disclosure controls and procedures have been designed to
ensure that material information relating to the Company and its Subsidiaries
is made known to the Companys principal executive officer and principal
financial officer by others within whose entities; and such disclosure controls
and procedures are effective.
(aa)
There are no affiliations or
associations between any member of FINRA and any of the Companys officers,
directors, or 5% or greater securityholders, except as set forth in the
Registration Statement, the Pricing Prospectus and the Prospectus.
4.
Agreements
of the Company.
The Company
covenants and agrees with the several Underwriters as follows:
(a)
The Company will not, either
prior to the Applicable Time or thereafter during such period as the Prospectus
is required by law to be delivered in connection with sales of the Shares by an
Underwriter or a dealer, file any amendment or supplement to the Registration
Statement, the Base Prospectus or the Prospectus, unless a copy thereof shall
first have been submitted to the Representative within a reasonable period of
time prior to the filing thereof and the Representative shall not have objected
thereto in good faith.
(b)
The Company will notify the
Representative promptly, and will confirm such advice in writing, (i) when
any amendment to the Registration Statement has been filed or
becomes effective or any
amendment or supplement to the Prospectus has been filed, (ii) of any
request by the Commission for amendments or supplements to the Registration
Statement or the Prospectus or for additional information, (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or preventing or suspending the use of the Base
Prospectus, any preliminary prospectus, the Prospectus Supplement, the
Prospectus or any Issuer Free Writing Prospectus or the initiation of any
proceedings for that purpose or the threat thereof, (iv) of the happening
of any event during the period mentioned in the third sentence of Section 4(e) that
in the judgment of the Company makes any statement made in the Registration
Statement or the Prospectus untrue or that requires the making of any changes
in the Registration Statement or the Prospectus in order to make the statements
therein, in the light of the circumstances in which they are made, not
misleading, and (v) of receipt by the Company or any representative or
attorney of the Company of any other communication from the Commission relating
to the Company, the Registration Statement, any preliminary prospectus, the
Base Prospectus, the Prospectus Supplement or the Prospectus. If at any time the Commission shall issue any
order suspending the effectiveness of the Registration Statement or preventing
or suspending the use of the Base Prospectus, any preliminary prospectus, the
Prospectus Supplement, the Prospectus or any Issuer Free Writing Prospectus,
the Company will make every reasonable effort to obtain the withdrawal of such
order at the earliest possible moment.
If the Company has omitted any information from the Registration
Statement pursuant to Rule 430B of the Rules and Regulations, the
Company will comply with the provisions of and make all requisite filings with
the Commission pursuant to said Rule 430B and notify the Representative
promptly of all such filings. If the
Company elects to rely upon Rule 462(b) under the Act, the Company
shall file a registration statement under Rule 462(b) with the
Commission in compliance with Rule 462(b) by 10:00 p.m.,
Washington, D.C. time, on the date of this Agreement, and the Company shall at
the time of filing either pay to the Commission the filing fee for such Rule 462(b) registration
statement or give irrevocable instructions for the payment of such fee pursuant
to the Rules and Regulations.
(c)
The Company will furnish to
the Representative, without charge, a copy of each of the Registration
Statement and of any pre- or post-effective amendment thereto, including
financial statements and schedules, and all exhibits thereto and will furnish
to the Representative, without charge, for transmittal to each of the other
Underwriters, a copy of the Registration Statement and any pre- or
post-effective amendment thereto, including financial statements and schedules
but without exhibits.
(d)
The Company will comply with
all the provisions of any undertakings contained in the Registration Statement.
(e)
So long as delivery of a
prospectus by an Underwriter or dealer may be required by the Act (including in
circumstances where such requirement may be satisfied pursuant to Rule 172
of the Rules and Regulations), the Company will deliver to each of the
Underwriters, without charge, as many written and electronic copies of each
preliminary prospectus, the Base Prospectus, the Prospectus Supplement, the
Prospectus, each Issuer Free Writing Prospectus or any amendment or supplement
thereto as the Representative may reasonably request. The Company consents to the use of each
preliminary prospectus, the Base Prospectus, the Prospectus Supplement, the
Prospectus, each Issuer Free Writing Prospectus and any amendment or supplement
thereto by the Underwriters and by all dealers to whom the Shares may be sold,
both in connection with the
offering or sale of the Shares and for any period of time thereafter during
which the Prospectus is required by law to be delivered in connection
therewith. If during such period of time
any event shall occur that in the judgment of the Company or counsel to the
Underwriters should be set forth in the Prospectus in order to make any statement
therein, in the light of the circumstances under which it was made, not
misleading, or if it is necessary to supplement or amend the Prospectus to
comply with law, the Company will forthwith prepare and duly file with the
Commission an appropriate supplement or amendment thereto, and will deliver to
each of the Underwriters, without charge, such number of copies of such
supplement or amendment to the Prospectus as the Representative may reasonably
request. The Company will not file any
document under the Exchange Act or the Exchange Act Rules and Regulations
before the termination of the offering of the Shares by the Underwriters, if
such document would be deemed to be incorporated by reference into the
Prospectus, without providing Underwriters and Underwriters counsel copies of
any such documents for review and comment a reasonable amount of time prior to
any proposed filing. If at any time
following issuance of an Issuer Free Writing Prospectus there occurred or
occurs an event or development as a result of which such Issuer Free Writing Prospectus
conflicted or would conflict with the information contained in the Registration
Statement, the Pricing Prospectus or the Prospectus or included or would
include an untrue statement of a material fact or omitted or would omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances prevailing at that subsequent time, not misleading,
the Company will promptly notify Needham & Company, LLC and, if
requested by Needham & Company, LLC, will promptly amend or
supplement, at its own expense, such Issuer Free Writing Prospectus to
eliminate or correct such conflict, untrue statement or omission.
(f)
Prior to any public offering
of the Shares, the Company will cooperate with the Representative and counsel
to the Underwriters in connection with the registration or qualification of the
Shares for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Representative may request; provided, that in no event
shall the Company be obligated to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action that would subject it to
general service of process in any jurisdiction where it is not now so subject.
(g)
The Company will, so long as
required under the Rules and Regulations, to the extent not available on
the Commissions EDGAR system or any successor system, furnish to its
stockholders within the time periods required by the Exchange Act and the NGM
an annual report (including a balance sheet and statements of income,
stockholders equity and cash flow of the Company and its consolidated
Subsidiaries, if any, certified by independent public accountants) and, as soon
as practicable after the end of each of the first three quarters of each fiscal
year (beginning with the fiscal quarter ending after the effective date of the
Registration Statement), consolidated summary financial information of the
Company and its Subsidiaries, if any, for such quarter in reasonable detail.
(h)
The Company will make generally
available to holders of its securities as soon as may be practicable, but in no
event later than the Availability Date (as defined below), an earning statement
(which need not be audited but shall be in reasonable detail) covering a period
of 12 months commencing after the Effective Date that will satisfy the
provisions of Section 11(a) of the Act (including Rule 158 of
the Rules and Regulations). For the
purpose of the
preceding sentence,
Availability Date
means the 45th day after
the end of the fourth fiscal quarter following the fiscal quarter that includes
such Effective Date, except that if such fourth fiscal quarter is the last
quarter of the Companys fiscal year, Availability Date means the 90th day
after the end of such fourth fiscal quarter.
(i)
Upon and subject to the
consummation of the transactions contemplated by this Agreement, the Company
will pay or reimburse if paid by the Representative all costs and expenses
incident to the performance of the obligations of the Company under this
Agreement and in connection with the transactions contemplated hereby,
including but not limited to costs and expenses of or relating to (i) the
preparation, printing and filing of the Registration Statement and exhibits to
it, each preliminary prospectus, the Base Prospectus, the Prospectus
Supplement, the Pricing Prospectus, the Prospectus, any Issuer Free Writing
Prospectus, and any amendment or supplement to any of the foregoing, (ii) the
preparation and delivery of certificates representing the Shares, (iii) the
printing of this Agreement, the Agreement Among Underwriters, any Selected
Dealer Agreements, any Underwriters Questionnaires, any Underwriters Powers
of Attorney, and any invitation letters to prospective Underwriters, (iv) furnishing
(including costs of shipping and mailing) such copies of the Registration
Statement, any preliminary prospectus, the Base Prospectus, the Prospectus
Supplement, the Prospectus, and any Issuer Free Writing Prospectus, and all
amendments and supplements thereto, as may be requested for use in connection
with the offering and sale of the Shares by the Underwriters or by dealers to
whom Shares may be sold, (v) the listing of the Shares on the NGM, (vi) any
filings required to be made by the Underwriters with FINRA, and the fees,
disbursements and other charges of counsel for the Underwriters in connection
therewith, (vii) the registration or qualification of the Shares for offer
and sale under the securities or Blue Sky laws of such jurisdictions designated
pursuant to
Section 4(f)
, including the fees, disbursements and
other charges of counsel to the Underwriters in connection therewith, and the
preparation and printing of preliminary, supplemental and final Blue Sky
memoranda, (viii) fees, disbursements and other charges of counsel to the
Company and of the Accountants, (ix) fees, disbursements and other charges
of counsel to the Underwriters,(x) the transfer agent for the Shares, and
(xi) any travel expenses of the Companys officers, directors and employees and
any other expenses of the Company in connection with attending or hosting
meetings with prospective purchasers of the Shares.
(j)
The Company will not at any
time, directly or indirectly, take any action designed or that might reasonably
be expected to cause or result in, or that will constitute, stabilization of
the price of the shares of Common Stock to facilitate the sale or resale of any
of the Shares.
(k)
The Company will apply the
net proceeds from the offering and sale of the Shares to be sold by the Company
in the manner set forth in the Pricing Prospectus and the Prospectus under Use
of Proceeds.
(l)
During the period beginning
from the date hereof and continuing to and including the date that is 90 days
after the date of the Prospectus, without the prior written consent of Needham &
Company, LLC, the Company will not (1) offer, sell, contract to sell,
pledge, grant options, warrants or rights to purchase, or otherwise dispose of
any equity securities of the Company or any other securities convertible into
or exchangeable for its Common Stock or other equity security or (2) enter
into any swap or other derivatives transaction that transfers to another,
in whole or in part, any of
the economic benefits or risks of ownership of shares of Common Stock, whether
any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or otherwise;
provided, however, that if (a) during the last 17 days of such 90-day
period the Company issues an earnings release or material news or a material
event relating to the Company occurs or (b) prior to the expiration of
such 90-day period, the Company announces that it will release earnings results
during the 16-day period beginning on the last day of such 90-day period, the
restrictions imposed by this Section 5(l) shall continue to apply
until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event,
unless Needham & Company, LLC waives, in writing, such extension.
The restrictions in this Section 4(l) shall
not apply to (A) the Shares sold hereunder, (B) the issuance by the
Company of shares of Common Stock upon the exercise of or pursuant to warrants,
awards and stock option agreements, in each case, existing and outstanding on
the date of this Agreement, (C) the issuance of securities pursuant to
stock option plans existing and outstanding on the date of this Agreement and
disclosed in the General Disclosure Package, (D) the issuance of employee
inducement grants of stock options to purchase shares of Common Stock and
shares of restricted stock in the aggregate amount not to exceed 200,000 shares
of Common Stock, and (E) the issuance of shares of Common Stock or options
to purchase shares of Common Stock in connection with any
bona fide
strategic alliances involving
the Company and other unaffiliated entities, including joint ventures,
licensing and collaboration agreements,
provided,
however
, that such issuance under this clause (E) shall not
exceed in the aggregate ten percent (10%) of the then outstanding shares of the
Companys Common Stock.
(m)
During the period of 90 days
after the date of the Prospectus, the Company will not, without the prior
written consent of the Representative, grant options to purchase shares of
Common Stock at a price less than the public offering price of the Shares sold
in this Offering. During the period of
90 days after the date of the Prospectus, the Company will not file with the
Commission or cause to become effective any registration statement relating to
any securities of the Company, other than registration statements on Form S-8,
without the prior written consent of Needham & Company, LLC.
(n)
The Company will cause each
of its executive officers and directors to, enter into lock-up agreements with
the Representative to the effect that they will not, without the prior written
consent of Needham & Company, LLC, sell, contract to sell or otherwise
dispose of any shares of Common Stock or rights to acquire such shares
according to the terms set forth in
Schedule III
hereto.
5.
Further Agreements.
(a)
The Company represents and agrees
that, without the prior written consent of Needham & Company, LLC, and
each Underwriter represents and agrees that, without the prior written consent
of the Company and Needham & Company, LLC, it has not made and will
not make any offer relating to the Shares that would constitute a free writing
prospectus as defined in Rule 405 of the Rules and Regulations. Any such Free Writing Prospectus the use of
which has been consented to by the Company and Needham & Company, LLC
is listed on Schedule II and herein called a
Permitted
Free Writing Prospectus
.
(b)
The Company agrees that is
has treated and will treat, as the case may be, each Permitted Free Writing
Prospectus as an Issuer Free Writing Prospectus and that it has complied and
will comply, as the case may be, with the requirements of Rules 164 and
433 of the Rules and Regulations applicable to any Permitted Free Writing
Prospectus, including timely Commission filing where required, record keeping
and legending.
6.
Conditions
of the Obligations of the Underwriters.
The obligations
of each Underwriter hereunder are subject to the following conditions:
(a)
All filings required by Rule 424
and Rule 430A of the Rules and Regulations shall have been made. If the Company has elected to rely upon Rule 462(b),
the registration statement filed under Rule 462(b) shall have become
effective by 10:00 p.m., Washington, D.C. time, on the date of this
Agreement.
(b)
(i)
No stop order
suspending the effectiveness of the Registration Statement or preventing or
suspending the use of the Base Prospectus, any preliminary prospectus, the
Prospectus Supplement, the Prospectus or any Issuer Free Writing Prospectus
shall have been issued and no proceedings for that purpose shall be pending or
threatened by the Commission, (ii) no order suspending the effectiveness
of the Registration Statement or the qualification or registration of the
Shares under the securities or Blue Sky laws of any jurisdiction shall be in
effect and no proceeding for such purpose shall be pending before or threatened
or contemplated by the Commission or the authorities of any such jurisdiction, (iii) any
request for additional information on the part of the staff of the Commission
or any such authorities shall have been complied with to the satisfaction of
the staff of the Commission or such authorities, (iv) after the date
hereof no amendment or supplement to the Registration Statement, the Prospectus
or the Pricing Prospectus shall have been filed unless a copy thereof was first
submitted to the Representative and the Representative do not object thereto in
good faith, and (v) the Representative shall have received certificates,
dated the Closing Date and, if later, the Option Closing Date and signed by the
Chief Executive Officer and the Chief Financial Officer of the Company (who
may, as to proceedings threatened, rely upon the best of their information and
belief), to the effect of clauses (i), (ii) and (iii) of this
paragraph.
(c)
Since the respective dates
as of which information is given in the Registration Statement and the Pricing
Prospectus, (i) there shall not have been a material adverse change in the
general affairs, business, business prospects, properties, management,
condition (financial or otherwise) or results of operations of the Company and
its Subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, in each case other than as described in or
contemplated by the Registration Statement and the Pricing Prospectus, and (ii) neither
the Company nor any of its Subsidiaries shall have sustained any material loss
or interference with its business or properties from fire, explosion, flood or
other casualty, whether or not covered by insurance, or from any labor dispute
or any court or legislative or other governmental action, order or decree,
which is not described in the Registration Statement and the Pricing
Prospectus, if in the judgment of the Representative any such development makes
it impracticable or inadvisable to consummate the sale and delivery of the
Shares by the Underwriters at the initial public offering price.
(d)
Since the respective dates
as of which information is given in the Registration Statement and the Pricing
Prospectus, there shall have been no litigation or other proceeding instituted
against the Company, any of its Subsidiaries, or any of its or their officers
or directors in their capacities as such, before or by any federal, state or
local court, commission, regulatory body, administrative agency or other
governmental body, domestic or foreign, in which litigation or proceeding an
unfavorable ruling, decision or finding would, in the judgment of the
Representative, have a Material Adverse Effect or if, in the judgment of the
Representative, any such development makes it impracticable or inadvisable to
consummate the sale and delivery of the Shares by the Underwriters at the
initial public offering price.
(e)
Each of the representations
and warranties of the Company contained herein shall be true and correct in all
respects (in the case of any representation and warranty containing a
materiality or Material Adverse Effect qualification) or in all material
respects at the Closing Date and, with respect to the Option Shares, at the
Option Closing Date, and all covenants and agreements contained herein to be
performed on the part of the Company and all conditions contained herein to be
fulfilled or complied with by the Company at or prior to the Closing Date and,
with respect to the Option Shares, at or prior to the Option Closing Date,
shall have been duly performed, fulfilled or complied with.
(f)
Bryan Cave LLP have
furnished to the Representative such counsels written opinion and negative
assurances statement, as counsel to the Company, addressed to the Underwriters
and dated the Closing Date and any Option Closing Date (if such date is other
than the Closing Date), in form and substance reasonably satisfactory to the
Representative.
(g)
The Underwriters shall have
received from Proskauer Rose LLP, counsel for the Underwriters, such opinion or
opinions and negative assurances statement, dated the Closing Date and any
Option Closing Date (if such date is other than the Closing Date), with respect
to such matters as the Representative may reasonably require, and the Company
shall have furnished to such counsel such documents as they request for enabling
them to pass upon such matters.
(h)
Concurrently with the
execution and delivery of this Agreement, the Accountants shall have furnished
to the Representative a letter stating the conclusions and findings of such
firm, of the type ordinarily included in accountants comfort letters to
underwriters, dated the date of its delivery, addressed to the Representative
and in form and substance satisfactory to the Representative, confirming that
they are independent accountants with respect to the Company and its
Subsidiaries as required by the Act and the Exchange Act and the Rules and
Regulations and with respect to certain financial and other statistical and
numerical information contained or incorporated by reference in the
Registration Statement. At the Closing
Date and, as to the Option Shares, the Option Closing Date, the Accountants
shall have furnished to the Representative a letter, dated the date of its
delivery, which shall confirm, on the basis of a review in accordance with the
procedures set forth in the letter from the Accountants, that nothing has come
to their attention during the period from the date of the letter referred to in
the prior sentence to a date (specified in the letter) not more than three days
prior to the Closing Date and the Option Closing Date, as the case may be,
which would require any change in their letter dated the date hereof if it were
required to be dated and delivered at the Closing Date and the Option Closing
Date.
(i)
At the Closing Date and, as
to the Option Shares, the Option Closing Date, there shall be furnished to the
Representative a certificate, dated the date of its delivery, signed by each of
the Chief Executive Officer and the Chief Financial Officer of the Company, in
form and substance satisfactory to the Representative, to the effect that:
(i)
Each signer of such
certificate has carefully examined the Registration Statement, the Prospectus
and the General Disclosure Package (including any documents filed under the
Exchange Act and deemed to be incorporated by reference into the Pricing
Prospectus and the Prospectus) and (A) as of the date of such certificate,
such documents are true and correct in all material respects and do not omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not untrue or misleading and (B) in the case
of the certificate delivered at the Closing Date and the Option Closing Date,
since the Effective Date no event has occurred as a result of which it is
necessary to amend or supplement the Prospectus in order to make the statements
therein not untrue or misleading.
(ii)
Each of the representations
and warranties of the Company contained in this Agreement were, when originally
made, and are, at the time such certificate is delivered, true and correct.
(iii)
Each of the covenants
required to be performed by the Company herein on or prior to the date of such
certificate has been duly, timely and fully performed and each condition herein
required to be satisfied or fulfilled on or prior to the date of such
certificate has been duly, timely and fully satisfied or fulfilled.
(j)
On or prior to the Closing
Date, the Representative shall have received the executed agreements referred
to in
Section 4(n)
.
(k)
The Shares shall be qualified
for sale in such jurisdictions as the Representative may reasonably request and
each such qualification shall be in effect and not subject to any stop order or
other proceeding on the Closing Date or the Option Closing Date.
(l)
Prior to the Closing Date,
the Company will use its best efforts to list, subject to notice of issuance,
the Shares on the NGM, and effect and
maintain the listing of the Shares on the NGM thereafter.
(m)
The Company shall have
furnished to the Representative such certificates, in addition to those
specifically mentioned herein, as the Representative may have reasonably
requested as to the accuracy and completeness at the Closing Date and the
Option Closing Date of any statement in the Registration Statement or the Prospectus,
as to the accuracy at the Closing Date and the Option Closing Date of the
representations and warranties of the Company herein, as to the performance by
the Company of its obligations hereunder, or as to the fulfillment of the
conditions concurrent and precedent to the obligations hereunder of the
Representative.
7.
Indemnification.
(a)
The Company
will indemnify and hold harmless each Underwriter, the partners, members,
stockholders, directors, officers, employees, agents and affiliates of each
Underwriter and each person, if any, who controls each Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, liabilities, expenses and damages
(including any and all investigative, legal and other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted), to which they, or any of them, may
become subject under the Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, liabilities, expenses or damages arise out of or are based on
any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement, any preliminary prospectus, the Base Prospectus,
the Pricing Prospectus, the Prospectus or any amendment or supplement thereto
or any Issuer Free Writing Prospectus or any issuer information filed or
required to be filed pursuant to Rule 433(d) of the Rules and
Regulations, or the omission or alleged omission to state in such document a
material fact required to be stated in it or necessary to make the statements
in it not misleading in the light of the circumstances in which they were made,
or arise out of or are based in whole or in part on any inaccuracy in the
representations and warranties of the Company contained herein or any failure
of the Company to perform its obligations hereunder or under law in connection
with the transactions contemplated hereby;
provided
,
however
, that the Company will not
be liable to the extent that such loss, claim, liability, expense or damage
arises from the sale of the Shares in the public offering to any person by an
Underwriter and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
relating to any Underwriter furnished in writing to the Company by the
Representative, on behalf of any Underwriter, expressly for inclusion in the
Registration Statement, any preliminary prospectus, the Base Prospectus, the
Pricing Prospectus, the Prospectus or any Issuer Free Writing Prospectus. The Company acknowledges that the statements
set forth in the first, fourth, tenth, eleventh (price stabilization) and
fourteenth through eighteenth paragraphs under the heading Underwriting in
the Pricing Prospectus and the Prospectus constitute the only information
relating to any Underwriter furnished in writing to the Company by the
Representative on behalf of the Underwriters expressly for inclusion in the
Registration Statement, any preliminary prospectus, the Base Prospectus, the
Pricing Prospectus, the Prospectus or any Issuer Free Writing Prospectus. This indemnity agreement will be in addition
to any liability that the Company might otherwise have.
(b)
Each
Underwriter will indemnify and hold harmless the Company, each director of the
Company, each officer of the Company who signs the Registration Statement, and
each person, if any, who controls the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, as set forth in
Section 7(a)
,
but only insofar as losses, claims, liabilities, expenses or damages arise out
of or are based on any untrue statement or omission or alleged untrue statement
or omission made in reliance on and in conformity with information relating to
any Underwriter furnished in writing to the Company by the Representative, on
behalf of such Underwriter, expressly for inclusion in the Registration
Statement, any preliminary prospectus, the Base Prospectus, the Pricing
Prospectus, the Prospectus or any Issuer Free Writing Prospectus. The Company acknowledges that the statements
set forth in the first, fourth, tenth, eleventh (price stabilization) and
fourteenth through eighteenth paragraphs under the heading Underwriting in
the Pricing Prospectus and the Prospectus constitute the only
information
relating to any Underwriter furnished in writing to the Company by the
Representative on behalf of the Underwriters expressly for inclusion in the
Registration Statement, any preliminary prospectus, the Base Prospectus, the
Pricing Prospectus, the Prospectus or any Issuer Free Writing Prospectus. This indemnity will be in addition to any
liability that each Underwriter might otherwise have. Notwithstanding the provisions of this
Section 7(b)
,
in no event shall any indemnity by any Underwriter under this
Section 7(b)
exceed
the total discount and commission received by such Underwriter in connection
with the Offering.
(c)
Any party that
proposes to assert the right to be indemnified under this
Section 7
shall, promptly after receipt of notice of commencement of any action against
such party in respect of which a claim is to be made against an indemnifying
party or parties under this
Section 7
, notify each such
indemnifying party in writing of the commencement of such action, enclosing
with such notice a copy of all papers served, but the omission so to notify
such indemnifying party will not relieve it from any liability that it may have
to any indemnified party under the foregoing provisions of this
Section 7
unless, and only to the extent that, such omission results in the loss of
substantive rights or defenses by the indemnifying party. If any such action is brought against any
indemnified party and it notifies the indemnifying party of its commencement,
the indemnifying party will be entitled to participate in and, to the extent
that it elects by delivering written notice to the indemnified party promptly
after receiving notice of the commencement of the action from the indemnified
party, jointly with any other indemnifying party similarly notified, to assume
the defense of the action, with counsel reasonably satisfactory to the
indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense, the indemnifying party will not be liable to the indemnified party for
any legal or other expenses except as provided below and except for the
reasonable costs of investigation incurred by the indemnified party in
connection with the defense. The
indemnified party will have the right to employ its own counsel in any such
action, but the fees, expenses and other charges of such counsel will be at the
expense of such indemnified party unless (i) the employment of counsel by
the indemnified party has been authorized in writing by the indemnifying party,
(ii) the indemnified party has reasonably concluded (based on advice of
counsel) that there may be legal defenses available to it or other indemnified
parties that are different from or in addition to those available to the
indemnifying party, (iii) a conflict or potential conflict exists (based
on advice of counsel to the indemnified party) between the indemnified party
and the indemnifying party (in which case the indemnifying party will not have
the right to direct the defense of such action on behalf of the indemnified
party), or (iv) the indemnifying party has not in fact employed counsel
reasonably satisfactory to the indemnified party to assume the defense of such
action within a reasonable time after receiving notice of the commencement of
the action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or
parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm admitted to
practice in such jurisdiction at any one time for all such indemnified party or
parties. All such fees, disbursements
and other charges will be reimbursed by the indemnifying party promptly as they
are incurred. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such indemnified party unless
such settlement (i) includes an unconditional release of such indemnified
party from all liability on
any
claims that are the subject matter of such action and (ii) does not include
a statement as to, or an admission of, fault, culpability or a failure to act
by or on behalf of an indemnified party.
An indemnifying party will not be liable for any settlement of any
action or claim effected without its written consent (which consent will not be
unreasonably withheld or delayed).
(d)
If the
indemnification provided for in this
Section 7
is applicable in
accordance with its terms but for any reason is held to be unavailable to or
insufficient to hold harmless an indemnified party under paragraphs (a), (b) and
(c) of this
Section 7
in respect of any losses, claims,
liabilities, expenses and damages referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable (including any investigative, legal
and other expenses reasonably incurred in connection with, and any amount paid
in settlement of, any action, suit or proceeding or any claim asserted, but
after deducting any contribution received by the Company from persons other
than the Underwriters, such as persons who control the Company within the
meaning of the Act, officers of the Company who signed the Registration
Statement and directors of the Company, who also may be liable for contribution)
by such indemnified party as a result of such losses, claims, liabilities,
expenses and damages in such proportion as shall be appropriate to reflect the
relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand. The
relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions
received
by the Underwriters, in each case as set forth in the table on the cover page of
the Prospectus. If, but only if, the
allocation provided by the foregoing sentence is not permitted by applicable
law, the allocation of contribution shall be made in such proportion as is
appropriate to reflect not only the relative benefits referred to in the
foregoing sentence but also the relative fault of the Company, on the one hand,
and the Underwriters, on the other hand, with respect to the statements or
omissions that resulted in such loss, claim, liability, expense or damage, or
action in respect thereof, as well as any other relevant equitable
considerations with respect to such offering.
Such relative fault shall be determined by reference to whether the
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 Representative on behalf of the Underwriters, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this
Section 7(d)
were
to be determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that does
not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss claim, liability, expense or damage, or action in
respect thereof, referred to above in this Section 7(d) shall be
deemed to include, for purposes of this
Section 7(d)
, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the provisions of this
Section 7(d)
,
no Underwriter shall be required to contribute any amount in excess of the
underwriting discounts and commissions received by it and no person found
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) will be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The
Underwriters obligations to contribute as provided in this
Section 7(d)
are
several in proportion to their respective underwriting obligations and not
joint. For purposes
of
this Section 7(d), any person who controls a party to this Agreement
within the meaning of the Act will have the same rights to contribution as that
party, and each officer of the Company who signed the Registration Statement
will have the same rights to contribution as the Company, subject in each case
to the provisions hereof. Any party
entitled to contribution, promptly after receipt of notice of commencement of
any action against any such party in respect of which a claim for contribution
may be made under this
Section 7(d)
, will notify any such party or
parties from whom contribution may be sought, but the omission so to notify
will not relieve the party or parties from whom contribution may be sought from
any other obligation it or they may have under this
Section 7(d)
. No party will be liable for contribution with
respect to any action or claim settled without its written consent (which
consent will not be unreasonably withheld).
(e)
The indemnity
and contribution agreements contained in this
Section 7
and the
representations and warranties of the Company contained in this Agreement shall
remain operative and in full force and effect regardless of (i) any
investigation made by or on behalf of the Underwriters, (ii) acceptance of
any of the Shares and payment therefor, or (iii) any termination of this
Agreement.
8.
Reimbursement
of Certain Expenses.
In addition to
its other obligations under
Section 7(a)
of this Agreement,
the Company hereby agrees to reimburse the Underwriters on a quarterly basis
for all reasonable legal and other expenses incurred in connection with
investigating or defending any claim, action, investigation, inquiry or other
proceeding arising out of or based upon, in whole or in part, any statement or
omission or alleged statement or omission, or any inaccuracy in the representations
and warranties of the Company contained herein or failure of the Company to
perform its or their respective obligations hereunder or under law, all as
described in
Section 7(a),
notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the
obligations under this
Section 8
and the possibility that such
payment might later be held to be improper;
provided,
however,
that, to the extent any such payment is ultimately held to
be improper, the persons receiving such payments shall promptly refund them.
9.
Termination.
The obligations of the
several Underwriters under this Agreement may be terminated at any time on or
prior to the Closing Date (or, with respect to the Option Shares, on or prior
to the Option Closing Date), by notice to the Company from the Representative,
without liability on the part of any Underwriter to the Company if, prior to
delivery and payment for the Firm Shares or Option Shares, as the case may be,
in the sole judgment of the Representative, (i) trading in any of the
equity securities of the Company shall have been suspended or limited by the
Commission or by The NASDAQ Stock Market, (ii) trading in securities
generally on the NASDAQ Global Market
shall
have been suspended or limited or minimum or maximum prices shall have been
generally established on such exchange, or additional material governmental
restrictions, not in force on the date of this Agreement, shall have been
imposed upon trading in securities generally by such exchange, by order of the
Commission or any court or other governmental authority, or by The NASDAQ Stock
Market, (iii) a general banking moratorium shall have been declared by
either federal or New York State authorities or any material disruption of the
securities settlement or clearance services in the United States shall have
occurred, or (iv) any material adverse change in the financial or
securities markets in the United States or in political, financial or economic
conditions in the United States, any outbreak or material escalation of
hostilities involving the United States, a
declaration of a national emergency or war by the United States, or
other calamity or crisis, either within or outside the United States,
shall have occurred, the effect of which
is such as to make it, in the sole judgment of the Representative,
impracticable or inadvisable to proceed with completion of the public offering
or the delivery of and payment for the Shares.
If
this Agreement is terminated pursuant to
Section 10
hereof, the
Company shall not be under any liability to any Underwriter except as provided
in
Sections 4(j)
,
7
and
8
hereof; but, if for any other
reason the purchase of the Shares by the Underwriters is not consummated or if
for any reason the Company shall be unable to perform its obligations
hereunder, the Company will reimburse the Underwriters for all out-of-pocket
expenses (including the fees, disbursements and other charges of counsel to the
Underwriters) reasonably incurred by the Underwriters in connection with the
offering of the Shares.
10.
Substitution
of Underwriters.
If any one or
more of the Underwriters shall fail or refuse to purchase any of the Firm
Shares that it or they have agreed to purchase hereunder, and the aggregate
number of Firm Shares that such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase is not more than one-tenth of the aggregate
number of Firm Shares, the other Underwriters shall be obligated, severally and
not jointly, to purchase the Firm Shares that such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase, in the proportions which
the number of Firm Shares that they have respectively agreed to purchase
pursuant to
Section 1
bears to the aggregate number of Firm Shares
which all such non-defaulting Underwriters have so agreed to purchase, or in
such other proportions as the Representative may specify; provided that in no
event shall the maximum number of Firm Shares that any Underwriter has become
obligated to purchase pursuant to
Section 1
be increased pursuant
to this
Section 10
by more than one-ninth of such number of Firm
Shares without the prior written consent of such Underwriter. In any such case either the Representative or
the Company shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or in any other documents or
arrangements may be effected. If any
Underwriter or Underwriters shall fail or refuse to purchase any Firm Shares
that it or they agreed to purchase hereunder and the aggregate number of Firm
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase exceeds one-tenth of the aggregate number of the Firm
Shares and arrangements satisfactory to the Representative and the Company for
the purchase of such Firm Shares are not made within 48 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company for the purchase or sale of any
Shares under this Agreement. Any action
taken pursuant to this
Section 10
shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
11.
No
Fiduciary Relationship.
Notwithstanding
any preexisting relationship, advisory or otherwise, between the parties or any
oral representations or assurances previously or subsequently made by any
Underwriter, the Company acknowledges and agrees that (i) the purchase and
sale of the Shares pursuant to this Agreement (including the determination of
the terms of the offering of the Shares) is an arms-length commercial
transaction between the Company and the several Underwriters, (ii) in
connection therewith and with the process leading to such transaction, each
Underwriter is acting solely as a principal and not the agent or fiduciary of
the Company, (iii) no Underwriter has assumed an advisory or fiduciary
responsibility in
favor of the Company with respect to the offering contemplated hereby
or the process leading thereto (irrespective of whether such Underwriter has
advised or is currently advising the Company on other matters) or any other
obligation to the Company except the obligations expressly set forth in this
Agreement, (iv) the Underwriters and each of their respective affiliates
may be engaged in a broad range of transactions that involve interests that
differ from those of the Company and have no obligation to disclose or account to
the Company for any of such differing interests, and (v) the Company has
consulted its own legal, tax, accounting and financial advisors to the extent
it deemed appropriate. The Company
hereby agrees that it will not claim that the Underwriters, or any of them,
have rendered advisory services of any nature or respect, or owe a fiduciary or
similar duty to the Company, in connection with such transaction or the process
leading thereto.
12.
Miscellaneous.
Notice given pursuant to any
of the provisions of this Agreement shall be in writing and, unless otherwise
specified, shall be mailed or delivered (if by email with a delivery receipt) (a) if
to the Company, at the office of the Company, 51 Discovery, Suite 150,
Irvine, California 92618, Attention: Gail Itow, Vice President and Chief
Financial Officer (email address: gitow@netlist.com), with a copy to Brett J.
Souza, Esq., Bryan Cave LLP, 3161 Michelson Drive, Suite 1500,
Irvine, CA 92612 (email address: bjsouza@BryanCave.com), or (b) if to the
Underwriters, to the Representative at the offices of Needham &
Company, LLC, 445 Park Avenue, New York, New York 10022, Attention:
Corporate Finance Department (email address: ckeck@needhamco.com), with a copy
to Stuart Bressman, Esq., Proskauer Rose, LLP, 1585 Broadway, New York, NY
10036 (email address: sbressman@proskauer.com).
Any such notice shall be effective only upon receipt. Any notice under
Section 9
or
10
may be made by telecopier or telephone, but if so made shall be subsequently
confirmed in writing.
For
purposes of this Agreement,
knowledge
means the knowledge of the Chief Executive Officer, the Chief Financial Officer
and the Vice President of Research and Development of the Company after
reasonable inquiry.
This
Agreement has been and is made solely for the benefit of the several
Underwriters, the Company and the controlling persons, directors and officers
referred to in
Section 7
, and their respective successors and
assigns, and no other person shall acquire or have any right under or by virtue
of this Agreement. The term successors
and assigns as used in this Agreement shall not include a purchaser, as such
purchaser, of Shares from any of the several Underwriters.
Any
action required or permitted to be made by the Representative under this
Agreement may be taken by them jointly or by Needham & Company, LLC.
This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York applicable to contracts made and to be performed entirely
within such State.
This
Agreement may be signed in two or more counterparts with the same effect as if
the signatures thereto and hereto were upon the same instrument.
In
case any provision in this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Each of the Company and the Underwriters hereby waives any
right it may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or the transactions contemplated hereby.
Please
confirm that the foregoing correctly sets forth the agreement among the Company
and the several Underwriters.
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Very truly yours,
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NETLIST, INC.
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By:
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Title:
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Confirmed as of the date first
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above mentioned:
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NEEDHAM & COMPANY, LLC
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By:
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Title:
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ROTH CAPITAL PARTNERS LLC
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By:
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Title:
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SCHEDULE I
UNDERWRITERS
Underwriters
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Number of Firm
Shares to be
Purchased
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Needham &
Company, LLC
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2,996,250
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Roth Capital Partners LLC
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998,750
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Total.
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3,995,000
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SCHEDULE II
Issuer General Use Free Writing Prospectuses:
None
Permitted Free Writing Prospectuses:
None
SCHEDULE
III
FORM OF LOCK-UP AGREEMENT
DIRECTORS and OFFICERS
OF THE COMPANY SHALL SIGN THIS AGREEMENT
NEEDHAM &
COMPANY, LLC
ROTH
CAPITAL PARTNERS LLC
c/o
Needham & Company, LLC
445
Park Avenue
New
York, New York 10022
Ladies
and Gentlemen:
The
undersigned is a holder of securities of Netlist, Inc., a Delaware
corporation (the
Company
), and
wishes to facilitate the public offering of shares of the Common Stock (the
Common Stock
) of the Company (the
Offering
).
The undersigned recognizes that such Offering will be of benefit to the
undersigned.
In
consideration of the foregoing and in order to induce you to act as
underwriters in connection with the Offering, the undersigned hereby agrees
that, during the period commencing as of the date hereof and ending on the date
that is ninety (90) days after the date of the final Prospectus Supplement
relating to the Offering (the
Lock-Up Period
),
the undersigned will not, without the prior written approval of Needham &
Company, LLC, directly or indirectly, (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock or (2) enter into any
swap or other arrangement that transfers to another, in whole or in part, any
of the economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by
delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not apply to (a) purchases
of shares of Common Stock or other securities acquired in open market
transactions after the completion of the Offering, (b) transfers of shares
of Common Stock or any security convertible into Common Stock as a bona fide
gift, or (c) distributions of shares of Common Stock or any security
convertible into Common Stock to limited partners or stockholders of the
undersigned; provided that in the case of any transfer or distribution pursuant
to clause (b) or (c), each donee or distributee shall sign and deliver a
lock up letter substantially in the form of this letter, or (d) the
establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange
Act for the transfer of shares of Common Stock, provided that such plan does
not provide for the transfer of Common Stock during the Lock-up Period and no
public announcement or filing under the Exchange Act regarding the establishment
of such plan shall be required of or voluntarily made by or on behalf of the
undersigned or the Company, or (e) issuances of securities solely made in
connection with exercises of outstanding stock options of the Company, provided
that any shares of common stock received upon such exercise will be subject to
the trading restrictions discussed above.
If (a) during the last 17 days of the Lock-Up Period the Company
issues an earnings release or material news or a material event
relating to the Company occurs or (b) prior to the expiration of
the Lock-Up Period, the Company announces that it will release earnings results
during the 16-day period beginning on the last day of the Lock-Up Period, the
restrictions imposed by this Agreement shall continue to apply until the
expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event, unless
Needham & Company, LLC waives, in writing, such extension. In addition, the undersigned agrees that,
without the prior written consent of Needham & Company, LLC, the
undersigned will not, during the Lock-Up Period, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for
Common Stock. The undersigned confirms
that he, she or it understands that the underwriters and the Company will rely
upon the representations set forth in this Agreement in proceeding with the
Offering. The undersigned further
confirms that the agreements of the undersigned are irrevocable and shall be
binding upon the undersigneds heirs, legal Representative, successors and
assigns. The undersigned agrees and
consents to the entry of stop transfer instructions with the Companys transfer
agent against the transfer of securities held by the undersigned except in
compliance with this Agreement.
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Very truly yours,
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(Name)
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(Address)
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Exhibit 5.1
March 19, 2010
Board
of Directors
Netlist, Inc.
475
Goddard
Irvine,
CA 92618
Gentlemen:
We
have acted as special counsel to Netlist, Inc., a Delaware corporation
(the Company), in connection with the public offering of 3,995,000 shares
of the Companys common stock, par value $.001 per share (the Shares),
including up to 599,250 shares which Needham & Company, LLC and Roth
Capital Partners LLC, as the underwriters in the public offering (collectively,
the Underwriter), have the option to purchase to cover over-allotments (if
any) pursuant to the terms of an Underwriting Agreement dated as of March 19,
2010, by and between the Company and the Underwriter (the Underwriting
Agreement). The Shares are included in a Registration Statement on Form S-3
(Registration No. 333-164290) (the Registration Statement) filed by the
Company with the Securities and Exchange Commission (the Commission) under
the Securities Act of 1933, as amended (the Act). We refer to our opinion dated January 11,
2010, included as Exhibit 5.1 to the Registration Statement. We also refer to the prospectus supplement
dated as of even date herewith and the accompanying prospectus included in the
Registration Statement (collectively, the Prospectus). This opinion is being
furnished in connection with the requirements of Item 601(b)(5) of
Regulation S-K under the Act.
In
rendering this opinion, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of the following
(i)
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the Registration Statement;
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(ii)
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the Prospectus;
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(iii)
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the Underwriting Agreement;
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(iv)
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the Restated Certificate of Incorporation of the Company filed on
November 20, 2006; and
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(v)
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the Amended and Restated Bylaws of the Company as in effect on the
date hereof.
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We
have also examined originals or copies, certified or otherwise identified to
our satisfaction, of other corporate records, agreements and instruments of the
Company, certificates of public officials and officers of the Company, and such
other documents, records and instruments, and we have made such legal and
factual inquiries, as we have deemed necessary or appropriate as a basis for us
to render the opinions hereinafter expressed.
In our examination of the foregoing, we have assumed the genuineness of
all signatures, the legal competence and capacity of natural persons, the
authenticity of all documents submitted to us as originals and the conformity
with authentic original documents of all documents submitted to us as copies.
When relevant facts were not
independently established, we have relied without independent investigation as
to matters of fact upon statements of governmental officials and upon
representations made in or pursuant to the certificates and statements of
appropriate representatives of the Company.
In
connection herewith, we have assumed that, other than with respect to the
Company, all of the documents referred to in this opinion letter have been duly
authorized by, have been duly executed and delivered by, and constitute the
valid, binding and enforceable obligations of, all of the parties to such
documents, all of the signatories to such documents have been duly authorized
and all such parties are duly organized and validly existing and have the power
and authority (corporate or other) to execute, deliver and perform such
documents.
Based upon the foregoing and
in
reliance thereon, and subject to the assumptions, comments,
qualifications, limitations and exceptions set forth herein, we are of the
opinion that the Shares, upon the issuance and delivery of the Shares to the
Underwriter, in exchange for all consideration therefor in accordance with the
terms of the Underwriting Agreement, will be validly issued, fully paid and
non-assessable.
The
opinion set forth herein is made as of the date hereof and is subject to, and
may be limited by, future changes in the factual matters set forth herein, and
we undertake no duty to advise you of the same. The
opinion expressed herein is
based upon the law in effect (and published or otherwise generally available)
on the date hereof, and we assume no obligation to revise or supplement the
opinion should such law be changed by legislative action, judicial decision or
otherwise.
We do not render any
opinions except as set forth above. We
hereby consent to the filing of this opinion as Exhibit 5.1 to the Companys
Current Report on Form 8-K to be filed on the date hereof and to the use
of our name in the Prospectus under the caption Legal Matters. In giving such
consent, we do not hereby admit that we are in the category of persons whose
consent is required under Section 7 of the Act or the rules and
regulations of the Commission.
Very truly yours,
/s/ Bryan Cave LLP
2
Exhibit
99.1
NEWS
RELEASE for March 19, 2010
Contact:
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Allen &
Caron Inc
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Gail
Itow
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Jill
Bertotti (investors)
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Chief
Financial Officer
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jill@allencaron.com
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Netlist, Inc.
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Len
Hall (media)
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(949)
435-0025
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len@allencaron.com
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(949)
474-4300
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NETLIST,
INC. ANNOUNCES PRICING OF COMMON STOCK OFFERING,
AN
INCREASE OF 33% OVER THE
PREVIOUSLY
ANNOUNCED OFFERING SIZE
IRVINE,
California, March 19, 2010 Netlist, Inc. (NasdaqGM: NLST) today
announced the pricing of an underwritten public offering of 3,995,000 shares of its common stock
at a price to the public of $3.85 per
share for gross proceeds of approximately $15.38 million. This represents an
increase of approximately 33%, or an additional 995,000 shares, from the
previously announced offering size of 3,000,000 shares of common stock.
After
underwriting discounts and commissions and estimated offering expenses payable
by us, Netlist expects to receive net proceeds of approximately $14.12 million. Netlist has also granted the underwriters a
30-day option to purchase up to 599,250
additional shares at the public offering price to cover over-allotments, if
any, which would result in additional net proceeds of approximately $2.17
million if exercised in full. The
offering is expected to close on or about March 24, 2010, subject to satisfaction of customary closing conditions.
Needham &
Company, LLC is acting as the sole book-running manager for the offering and
Roth Capital Partners LLC is acting as co-manager.
Netlist
intends to use the net proceeds from the offering for its operations, including
marketing, research and development, working capital, and for other general
corporate purposes.
The
shares of common stock described above are being offered by Netlist and were
registered pursuant to a registration statement previously filed and declared
effective by the Securities and Exchange Commission. The shares of common stock
may be offered only by means of a prospectus, including a prospectus
supplement, forming a part of the effective registration statement. Copies of the preliminary prospectus
supplement, the final prospectus supplement and the accompanying base
prospectus relating to this offering may be obtained from the SECs web site at
http://www.sec.gov, or from Needham & Company, LLC, 445 Park Avenue,
New York, NY 10022, at (212) 371-8300.
This
press release shall not constitute an offer to sell or the solicitation of an
offer to buy any securities of Netlist, Inc., nor shall there be any sale
of these securities in any state or jurisdiction in which such offer,
solicitation, or sale would be unlawful prior to registration or qualification
under the securities laws of any such state or jurisdiction.
About Netlist, Inc.
Netlist
designs and manufactures high-performance memory subsystems for the server and
high- performance computing and communications markets. Netlists memory
subsystems are developed for applications in which high-speed, high-capacity
memory, functionality, small form factor, and heat dissipation are key requirements.
These applications include tower-servers, rack-mounted servers, blade servers,
high-performance computing clusters, engineering workstations, and
telecommunication equipment. Netlist maintains its headquarters in Irvine,
California with manufacturing facilities in Suzhou, China.
Safe Harbor Statement
This
news release contains forward-looking statements regarding future events and
the future performance of Netlist, including future opportunities and growth
for the companys business. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from those
expected or projected. These risks and uncertainties include, but are not
limited to, Netlists ability to complete the offering referred to in this
release; Netlists ability to complete development of and volume production of
NetVault
TM
and HyperCloud
TM
; the costs and unpredictability of litigation over
infringement of Netlists intellectual property; the rapidly-changing nature of
technology; volatility in the pricing of DRAM ICs and NAND; changes in and
uncertainty of customer demand, including delays in product qualifications;
delays in Netlists and its customers product releases and development;
introductions of new products by competitors; changes in end-user demand for
technology solutions; Netlists ability to attract and retain skilled
personnel; Netlists reliance on suppliers of critical components; fluctuations
in the market price of evolving industry standards; and the political and
regulatory environment in the Peoples Republic of China. Other risks and
uncertainties are described in Netlists annual report on Form 10-K, filed
with the SEC on February 19, 2010, and subsequent filings with the SEC
made by Netlist from time to time. Except as required by law, Netlist
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.