ADC Therapeutics SA 8-K, filed May 8, 2024
ADC Therapeutics SA (ADCT)
About this 8-K
ADC Therapeutics SA filed this 8-K on May 8, 2024, reporting on events of May 6, 2024.
Items reported
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 8.01. Other Events.
On May 6, 2024, ADC Therapeutics SA (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with Jefferies LLC, Guggenheim Securities, LLC and Cantor Fitzgerald & Co., as the representatives of the several underwriters named in Schedule I thereto (the “Underwriters”), providing for the offering and sale by the Company of 13,411,912 common shares, par value CHF 0.08 per share (the “Shares”), and pre-funded warrants to purchase 8,163,265 common shares, par value CHF 0.08 per share (the “Pre-Funded Warrants”, and together with the Shares, the “Securities”). The Underwriting Agreement includes the terms and conditions for the offering and sale of the Securities, indemnification and contribution obligations, and other terms and conditions customary in agreements of this type. The foregoing description of the Underwriting Agreement does not purport to be complete and is qualified in its entirety by reference to the Underwriting Agreement, which is attached to this Current Report on Form 8-K as Exhibit 1.1.
The Pre-Funded Warrants are exercisable at any time after their original issuance until the tenth anniversary of their original issuance. At any time during the last 90 days of the term, the holder may exchange the Pre-Funded Warrant for, and the Company will issue, a new pre-funded warrant for the number of common shares then remaining under the Pre-Funded Warrant. The Pre-Funded Warrants will be exercisable, at the option of each holder, in whole or in part (but not for less than a common share) by delivering to the Company a duly executed exercise notice and by payment of the aggregate exercise price; provided that any exercise of the Pre-Funded Warrants must be for at least 50,000 common shares (or, if less, the remaining common shares available for purchase under the Pre-Funded Warrants). A holder will not be entitled to exercise any portion of any Pre-Funded Warrant that, upon giving effect to such exercise, would cause the aggregate number of our common shares beneficially owned by the holder (together with its affiliates and certain attribution parties) to exceed 9.99% (or, 61 days after a written notice from such holder, any other percentage not in excess of 19.99%) of the number of our common shares outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Pre-Funded Warrants. The exercise price per common share purchasable upon the exercise of the Pre-Funded Warrants is CHF 0.08 per share, subject to customary adjustments. In lieu of making cash payment of the aggregate exercise price, when a registration statement (and a current prospectus) is not available for the issuance of common shares upon exercise of the Pre-Funded Warrants, a holder may elect to exercise the Pre-Funded Warrants on a cashless basis. However, if the Company, at the time of receipt of an exercise notice electing cashless exercise, (i) does not, or has reason to believe that the Company does not, have a sufficient amount of freely distributable equity to fund the nominal value of the number of common shares the Company would be required to deliver upon such cashless exercise, and (ii) (x) holds common shares representing more than 2% of its share capital registered in the commercial register at that time (the “Minimum Stock”) in treasury, then the Company will not be obligated to (but may) deliver more than such number of common shares to the holder as exceeds the Minimum Stock or (y) holds up to the Minimum Stock in treasury, then the Company will not obligated to deliver any common shares to the holder. The exercise notice will be deemed to be null and void to the extent the holder receives fewer common shares than to which such exercise notice relates. In the event of (i) a sale, lease or other transfer of all or substantially all of the Company’s assets, (ii) a merger or consolidation involving the Company in which the Company is not the surviving entity or in which the Company’s outstanding share capital is converted into or exchanged for shares of capital stock or other securities or property of another entity, or (iii) any sale by holders of the Company’s outstanding voting equity securities in a single transaction or series of related transactions of shares constituting a majority of our outstanding combined voting power, and (x) if the consideration received by the Company’s shareholders consists solely of cash and/or marketable securities, then holders of the Pre-Funded Warrants will be deemed to have exercised their Pre-Funded Warrants (without regard to the exercise limitations described above) immediately prior to the closing date of such transaction or (y) if the consideration received by the Company’s shareholders does not consist solely of cash and/or marketable securities, then the Company will cause the successor or surviving entity to assume the Pre-Funded Warrants. Subject to applicable laws, the Pre-Funded Warrants may be offered for sale, sold, transferred or assigned without the Company’s consent. The Pre-Funded Warrants are governed by the laws of Switzerland. The foregoing description of the Pre-Funded Warrants does not purport to be complete and is qualified in its entirety by reference to the form of Pre-Funded Warrant, which is attached to this Current Report on Form 8-K as Exhibit 4.1.
The Shares were offered to investors at $4.900 per Share and the Pre-Funded Warrants were offered to investors at $4.812 per Pre-Funded Warrant (being the offering price per Share in the offering minus the exercise price). The gross proceeds from the offering, before deducting the underwriting discount and offering expenses, were approximately $105.0 million. The offering closed on May 8, 2024. The offer and sale of the Securities have been
registered under the Securities Act of 1933, as amended, pursuant to a registration statement on Form S-3 (File No. 333-270570) (the “Registration Statement”). The Company has filed with the U.S. Securities and Exchange Commission a prospectus supplement dated May 6, 2024, together with an accompanying prospectus dated March 14, 2024, relating to the offer and sale of the Securities. Opinion of counsel regarding the validity of the Securities and the common shares issuable upon exercise of the Pre-Funded Warrants is attached to this Current Report on Form 8-K as Exhibit 5.1 and the consent of such counsel relating to the incorporation of such opinion into the Registration Statement is attached to this Current Report on Form 8-K as Exhibit 23.1.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit Number | Description |
| 1.1 | Underwriting Agreement, dated May 6, 2024, among ADC Therapeutics SA and Jefferies LLC, Guggenheim Securities, LLC and Cantor Fitzgerald & Co., as the representatives of the several underwriters named in Schedule I thereto |
| 4.1 | Form of Pre-Funded Warrant |
| 5.1 | Opinion of Homburger AG |
| 23.1 | Consent of Homburger AG (included in Exhibit 5.1) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ADC Therapeutics SA | ||
| Date: May 8, 2024 | ||
| By: | /s/ Peter J. Graham | |
| Name: | Peter J. Graham | |
| Title: | Chief Legal Officer | |
Exhibit 1.1
ADC Therapeutics SA
13,411,912 Common SHares, nominal Value CHF 0.08 PER SHARE
Pre-funded
warrants to purchase 8,163,265 common sHARES, nominal Value CHF 0.08 PER SHARE
UNDERWRITING AGREEMENT
May 6, 2024
May 6, 2024
Jefferies LLC
Guggenheim Securities, LLC
Cantor Fitzgerald & Co.
As Representatives of the several Underwriters named in Schedule I hereto
c/o Jefferies LLC
520 Madison Avenue
New York, New York 10022
c/o Guggenheim Securities, LLC
330 Madison Avenue
New York, New York 10017
c/o Cantor Fitzgerald & Co.
110 East 59th Street, 6th Floor
New York, New York 10022
Ladies and Gentlemen:
ADC Therapeutics SA, a société anonyme domiciled in Epalinges, Switzerland, and organized under the laws of Switzerland (the “Company”), proposes, subject to the terms and conditions stated herein, to issue and sell to the several Underwriters named in Schedule I hereto (the “Underwriters”), for whom you are acting as representatives (the “Representatives”), (i) an aggregate of 13,411,912 common shares, nominal value CHF 0.08 per share (the “Shares”) and (ii) pre-funded warrants of the Company to purchase 8,163,265 common shares (the “Pre-Funded Warrants” and together with the Shares, the “Securities”). As used herein, “Warrant Shares” means the common shares issuable upon exercise of the Pre-Funded Warrants. The common shares, nominal value CHF 0.08 per share, of the Company to be outstanding after giving effect to the sale of Shares contemplated hereby are hereinafter referred to as the “Common Shares.” In the event only one underwriter is listed in Schedule I hereto, any references in this Underwriting Agreement (this “Agreement”) to the “Underwriters” shall be deemed to refer to the sole underwriter in the singular form listed in such Schedule I.
The Company has filed with the Securities and Exchange Commission (the “Commission”) a shelf registration statement on Form F-3 (File No. 333-270570), as amended by post-effective amendment number 1, filed to convert such Registration Statement on Form F-3 to a Registration Statement on Form S-3, including a prospectus, relating to the securities (the “Shelf Securities”), including the Securities, to be offered and sold from time to time by the Company. Such registration statement as amended to the date of this Agreement, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430B under the Securities Act of 1933, as amended (the “Securities Act”), is hereinafter referred to as the “Registration Statement,” and the related prospectus covering the Shelf Securities dated March 14, 2024 in the form first used to confirm sales of the Securities (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “Basic Prospectus.” The Basic Prospectus, as supplemented by the prospectus supplement specifically relating to the Securities in the form first used to confirm sales of the Securities (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act), is hereinafter referred to as the “Prospectus,” and the term “preliminary prospectus” means any preliminary form of the Prospectus. For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, “Time of Sale Prospectus” means the documents and pricing information set forth opposite the caption “Time of Sale Prospectus” in Schedule II hereto, and “broadly available road show” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. As used herein, the terms “Registration Statement,” “Basic Prospectus,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein as of the date hereof. The terms “supplement,” “amendment” and “amend” as used herein with respect to the Registration Statement, the Basic Prospectus, the Time of Sale Prospectus, any preliminary prospectus or the Prospectus shall include all documents subsequently filed by the Company with the Commission pursuant to
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are deemed to be incorporated by reference therein.
1. Representations and Warranties. The Company represents and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose or pursuant to Section 8A under the Securities Act are pending before or, to the Company’s knowledge, threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the Exchange Act and incorporated by reference in the Time of Sale Prospectus or the Prospectus complied or will comply when so filed in all material respects with the Exchange Act and the applicable rules and regulations of the Commission thereunder, (ii) each part of the Registration Statement, when such part became effective, did not contain, and each such part, as amended or supplemented, if applicable, as of the date of such amendment or supplement, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (iii) the Registration Statement as of the date hereof does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (iv) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, as of the date of such amendment or supplement, will comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (v) the Time of Sale Prospectus does not, and at the time of each sale of the Securities in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 4), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (vi) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does 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 and (vii) the Prospectus, as of its date, does not contain and, as amended or supplemented, if applicable, as of the date of such amendment or supplement, or as of the Closing Date (as defined in Section 4), 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, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein, it being understood and agreed upon that the only such information furnished by any Underwriter consists of the following information in the Prospectus furnished on behalf of each Underwriter: the information contained in the first two sentences of first paragraph under the section entitled “Commission and Expenses"; the first sentence of the first paragraph under the section entitled “Stabilization”; and the first and fourth sentences under the section entitled “Electronic Distribution” under the caption “Underwriting” (collectively, the “Underwriter Information”).
(c) The Company is not an “ineligible issuer” in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies, or if filed after the effective date of this Agreement, will comply when filed, in all material respects with the applicable requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Except for the free writing prospectuses, if any, identified in Schedule II hereto, and electronic road shows, if any, each furnished to the Representatives before first use, the Company has not prepared, used or referred to, and will not, without the Representatives’ prior consent, prepare, use or refer to, any free writing prospectus.
(d) The Company has been duly incorporated and is validly existing as a Swiss stock corporation (société anonyme) in good standing (to the extent this concept applies) under the laws of Switzerland, has the corporate power and authority to own its property and to conduct its business as described in the Time of Sale
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Prospectus, is not in liquidation or receivership or the subject of any insolvency or bankruptcy proceedings and is duly qualified to transact business (and, if applicable, is in good standing) in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing (to the extent this concept applies) would not have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(e) Each subsidiary of the Company has been duly incorporated, is validly existing as a corporation (and, if applicable, in good standing) under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own its property and to conduct its business as described in the Time of Sale Prospectus, is not in liquidation or receivership or the subject of any insolvency or bankruptcy proceedings and is duly qualified to transact business (and, if applicable, is in good standing) in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing (to the extent this concept applies) would not have a material adverse effect on the Company and its subsidiaries, taken as a whole. Except as otherwise described in each of the Prospectus, as of its date, the Registration Statement and the Time of Sale Prospectus, all of the issued shares of capital stock of each subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and such shares are owned directly by the Company, free and clear of all liens, encumbrances, equities or claims.
(f) This Agreement has been duly authorized, executed and delivered by the Company.
(g) The common shares of the Company issued and outstanding prior to the issuance of the Securities have been duly authorized and are validly issued, fully paid and non-assessable.
(h) (i) The issued and outstanding share capital of the Company and the capital range and conditional share capital of the Company conform as to legal matters to the description thereof contained in each of the Time of Sale Prospectus and the Prospectus, as of its date, (ii) except as otherwise described in each of the Prospectus, as of its date, the Registration Statement and the Time of Sale Prospectus, there are no outstanding rights (including, without limitation, subscription rights), warrants or options to acquire, or instruments, securities or rights convertible into or exchangeable for, any Common Shares or other equity interest in the Company to which the Company or any of its subsidiaries is a party, or any contract, commitment, or arrangement of any kind to which the Company or any of its subsidiaries is a party under which the Company or any of its subsidiaries have committed to issue any Common Shares or grant any such convertible or exchangeable securities or any such rights, warrants or options, (iii) except as otherwise described in each of the Prospectus, as of its date, the Registration Statement and the Time of Sale Prospectus, there are no outstanding rights (including, without limitation, subscription rights), warrants or options to acquire, or instruments, securities or rights convertible into or exchangeable for, any shares of any of the Company’s subsidiaries to which the Company or any of its subsidiaries is a party, or any contract, commitment, or arrangement of any kind to which the Company or any of its subsidiaries is a party under which the Company or any of its subsidiaries have committed to issue any shares, rights, warrants or options or instruments convertible into or exchangeable for, any shares of any subsidiary of the Company and (iv) there are no legal restrictions on the subsequent transfer of the Shares, except as otherwise described in each of the Prospectus, the Registration Statement and the Time of Sale Prospectus.
(i) The issuance and sale of the Shares will have been duly authorized on the Closing Date, and (i) the Shares, when delivered and paid for in the manner contemplated by this Agreement, will, at all times, be validly issued, fully paid and non-assessable; and (ii) the Shares, when delivered and paid for in the manner contemplated by this Agreement, will be, subject only to any restrictions applicable under the Company’s articles of association or applicable laws, freely transferable except as otherwise described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, and will not be subject to any pre-emptive right, third party rights or similar rights (including without limitation any security interest under articles 24 and 25 of the Swiss Federal Act on Intermediated Securities) granted by the Company or any of its subsidiaries other than as contemplated by this Agreement. The Pre-Funded Warrants have been duly and validly authorized by the Company and, when executed and delivered by the Company, will be valid and binding agreements of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles. The Warrant Shares have been duly authorized and validly reserved for issuance upon exercise of the Pre-Funded Warrants in a number sufficient to meet the current exercise requirements. The Warrant Shares, when issued and delivered upon exercise of the Pre-Funded Warrants in accordance therewith,
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will, at all times, be validly issued, fully paid and non-assessable, and when delivered and paid for in the manner contemplated by the Pre-Funded Warrants, will be, subject only to any restrictions applicable under the Company’s articles of association or applicable laws, freely transferable except as otherwise described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, and will not be subject to any pre-emptive right, third party rights or similar rights (including without limitation any security interest under articles 24 and 25 of the Swiss Federal Act on Intermediated Securities) granted by the Company or any of its subsidiaries other than as contemplated by the Pre-Funded Warrants. The Company has reserved out of its conditional capital for financing purposes, solely for the purpose of enabling it to issue the Warrant Shares upon exercise of such Pre-Funded Warrants, the number of Warrant Shares that are issuable and deliverable upon the exercise of the Warrants and the Pre-Funded Warrants. On the Closing Date, the Warrant Shares will have been reserved for issuance.
(j) Immediately after the registration of the Capital Increase (as defined below) pursuant to Section 5, but in no event later than 9:00 a.m. (New York City time) on the date of registration of the Capital Increase in the in the Commercial Register of the Canton of Vaud pursuant to Section 5, the Shares will be registered in the Company’s uncertificated securities book (registre des droits-valeurs) according to article 973c of the Swiss Code of Obligations (the “CO”) in the name of Jefferies LLC, acting on behalf of the Underwriters, and on the Closing Date will be credited to a securities account of Jefferies LLC, acting on behalf of the several Underwriters.
(k) The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement and the Pre-Funded Warrants do not contravene any provision of (i) applicable law, (ii) the articles of association (Statuts) or the organizational regulations (Règlement d'organisation) of the Company (iii) or any agreement, or other instrument binding upon the Company or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a whole, or any judgment, order or decree of any governmental body, agency, or court having jurisdiction over the Company or any subsidiary, except that in the case of clauses (i) and (iii) as would not, individually, or in the aggregate, have a material adverse effect on the Company or on the power and ability of the Company to perform its obligations under this Agreement; and no consent, approval, authorization or order of, or qualification with, any governmental body or agency is required for the performance by the Company of its obligations under this Agreement, except (A) such as have been obtained or waived or as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Securities and the Warrant Shares; (B) the entry of the Shares in the Commercial Register of the Canton of Vaud; (C) the creation of intermediated securities (titres intermédiés) by way of entry of the Shares into the Depository Trust Company (“DTC”) and the subsequent crediting in one or several securities account(s); (D) the listing of the Shares on New York Stock Exchange (“NYSE”), subject to all of (A) to (D) being obtained or done on or prior to the Closing Date; and (E) the listing of Warrant Shares, if and when issued, on NYSE.
(l) Except as otherwise described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, all dividends, if any, and other distributions declared and payable on the Shares may under the current laws and regulations of Switzerland be paid in freely convertible CHF and, except for certain restrictions with respect to national and international sanctions relating to certain countries, may be freely transferred out of Switzerland without there being required any authorization by any governmental body or agency.
(m) There has not occurred any material adverse effect on the Company and its subsidiaries, taken as a whole, or any development involving a prospective material adverse effect on the Company and its subsidiaries, taken as a whole, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.
(n) There are no legal or governmental proceedings pending or, to the knowledge of the Company, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject (i) other than proceedings accurately described in all material respects in the Time of Sale Prospectus and proceedings that would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or a material adverse effect on the power or ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by the Time of Sale Prospectus or (ii) that are required to be described in the Registration Statement or the Prospectus and are not so described in all material respects; and there are no statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not described in all material respects or filed as required.
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(o) Each preliminary prospectus, if any, filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder.
(p) The Company is not, and after giving effect to the offering and sale of the Securities contemplated hereby and the application of the proceeds thereof as described in the Time of Sale Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.
(q) The Company and its subsidiaries (i) are in compliance with any and all applicable foreign, federal, state, cantonal and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(r) There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(s) Except as otherwise have been validly waived or complied with in connection with the sale of the Securities contemplated hereby or as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Securities registered pursuant to the Registration Statement.
(t) (i) None of the Company or its subsidiaries or controlled affiliates, or any director or officer, or, to the Company’s knowledge, any employee, agent or representative of the Company or of any of its subsidiaries or controlled affiliates, has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment, giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any government official (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) (“Government Official”) in order to influence official action, or to any person in violation of any applicable anti-corruption laws; (ii) the Company and its subsidiaries and controlled affiliates have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintained and will continue to maintain policies and procedures reasonably designed to promote and achieve compliance with such laws and with the representations and warranties contained herein; and (iii) neither the Company nor its subsidiaries will use, directly or indirectly, the proceeds of the offering in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of any applicable anti-corruption laws.
(u) The operations of the Company and its subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including, to the extent applicable, those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator
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involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(v) (i) Neither the Company nor any of its subsidiaries, nor any director or officer thereof, nor, to the Company’s knowledge, any employee, agent, controlled affiliate or representative of the Company or any of its subsidiaries, is an individual or entity (“Person”) that is, or is owned or controlled by a Person that is:
(A) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security Council (“UNSC”), the European Union (“EU”), His Majesty’s Treasury (“HMT”), the Swiss State Secretariat of Economic Affairs (“SECO”), the Swiss Directorate of International Law (“DIL”) or other relevant sanctions authority (collectively, “Sanctions”), or
(B) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Cuba, Iran, North Korea, Syria, the Crimea Region located in Ukraine, and the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic and any other Covered Region of Ukraine as may be determined by the U.S. Secretary of the Treasury pursuant to Executive Order 14065).
(ii) The Company will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:
(A) to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or
(B) in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).
(iii) For the past five (5) years, the Company and its subsidiaries have not engaged in, are not now engaged in, and will not engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.
(w) Subsequent to the respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding share capital other than from its employees or other service-providers in connection with the termination of their service pursuant to the terms of the equity compensation plans, nor declared, paid or otherwise made any dividend or distribution of any kind on its share capital; and (iii) except for the issuance of Common Shares into treasury, there has not been any material change in the share capital (other than the exercise or settlement or equity awards or grants or forfeiture of equity awards outstanding as of such respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, in each case granted pursuant to the equity compensation plans described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus), short-term debt or long-term debt of the Company and its subsidiaries, except in each case as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, respectively.
(x) The Company and its subsidiaries have good and marketable title to all real property and good and marketable title to all personal property (other than intellectual property, which is addressed exclusively in Section 1(y)) owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the Time of Sale Prospectus or such as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not materially interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries, in each case except as described in the Time of Sale Prospectus.
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(y) Except as described in each of the Prospectus, the Registration Statement or the Time of Sale Prospectus and except as would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) the Company and its subsidiaries own or have a valid license to all patents, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names (collectively, “Intellectual Property Rights”) used in or reasonably necessary to the conduct of their businesses as now operated by them, and as proposed to be operated in the future (including upon the commercialization of the Company’s and its subsidiaries’ products or services), in each case as described in the Registration Statement, Prospectus or the Time of Sale Prospectus (the “Company Intellectual Property”); (ii) to the Company’s knowledge, there are no third parties who have rights to any Company Intellectual Property, except for customary reversionary rights of third-party licensors; (iii) the Company Intellectual Property owned by the Company and its subsidiaries and, to the Company’s knowledge, the Company Intellectual Property licensed to the Company and its subsidiaries, are subsisting and, to the Company’s knowledge, valid and enforceable; (iv) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the validity, scope or enforceability of any Company Intellectual Property, and, to the Company’s knowledge, the Company is unaware of any facts which would form a reasonable basis for any such action, suit, proceeding or claim; (v) there is no pending or, to the Company’s knowledge, threatened in writing action, suit, proceeding or claim by others challenging the Company’s rights in or to any Company Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such action, suit, proceeding or claim; (vi) neither the Company nor any of its subsidiaries has received any written notice alleging any infringement, misappropriation or other violation of Intellectual Property Rights; (vii) to the Company’s knowledge, no third party is infringing, misappropriating or otherwise violating, or has infringed, misappropriated or otherwise violated, any Company Intellectual Property owned by the Company; (viii) to the Company’s knowledge, (A) neither the Company nor any of its subsidiaries infringes, misappropriates or otherwise violates, or has infringed, misappropriated or otherwise violated, any third-party Intellectual Property Rights, and (B) the commercialization of the products or services described in the Prospectus, the Registration Statement or the Time of Sale Prospectus as under development by the Company will not infringe, misappropriate, or otherwise violate any third-party Intellectual Property Rights; (ix) to the Company’s knowledge, the Company and its subsidiaries have complied with the terms of each agreement to which they are a party and pursuant to which Intellectual Property Rights have been licensed to the Company or its subsidiaries, and all such agreements are in full force and effect; (x) to the Company’s knowledge, during the prosecution of the patents and patent applications included in the Company Intellectual Property, the Company and its subsidiaries have complied with the duty of candor and good faith with respect to such patents and patent applications as required by the United States Patent and Trademark Office and all foreign offices having similar requirements; (xi) all employees or contractors engaged in the development of Company Intellectual Property on behalf of the Company or any subsidiary of the Company have executed an invention assignment agreement whereby such employees or contractors presently assign all of their right, title and interest in and to such Company Intellectual Property to the Company or the applicable subsidiary, and no such agreement has been breached or violated; (xii) to the Company’s knowledge, none of the Company Intellectual Property has been obtained, or is being used, by the Company or its subsidiary in violation of any contractual obligation binding on the Company or its subsidiaries or any of their respective officers, directors or employees or otherwise in violation of the rights of any persons; and (xiii) the Company and its subsidiaries use, and have used, commercially reasonable efforts to appropriately maintain all information intended to be maintained as a trade secret.
(z) No labor dispute with the employees of the Company or any of its subsidiaries exists, except as described in the Time of Sale Prospectus, or, to the knowledge of the Company, is imminent, in either case, that could have a material adverse effect on the Company and its subsidiaries, taken as a whole; and the Company is not aware of any existing, threatened or imminent labor disturbance by the employees of any of its principal suppliers, manufacturers or contractors that could have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(aa) The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as the Company reasonably believes are prudent and customary in the businesses in which they are engaged, except where the failure to be so insured would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; neither the Company nor any of its subsidiaries has been refused any insurance coverage sought or applied for three years preceding the date of this Agreement; and neither the Company nor any of its subsidiaries has any reason to
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believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.
(bb) The Company and its subsidiaries, taken as a whole, possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses, except where the failure to obtain such certificates, authorization and permits would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.
(cc) The Company and its subsidiaries on a consolidated basis maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles as applied in the United States (“GAAP”) and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
(dd) Except as described in each of the Registration Statement, the Prospectus and the Time of Sale Prospectus, since the end of the Company’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s internal control over financial reporting that has materially and adversely affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over financial reporting.
(ee) Except as described in each of the Registration Statement, the Prospectus and the Time of Sale Prospectus, the Company has not sold, issued or distributed any Common Shares, during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.
(ff) The Company and each of its subsidiaries have filed all federal, state, local and foreign tax returns required to be filed through the date of this Agreement or have requested extensions thereof (except where the failure to file would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole) and have paid all taxes required to be paid thereon (except for cases in which the failure to file or pay would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, or, except as currently being contested in good faith and for which reserves required by GAAP have been created in the financial statements of the Company), and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any tax deficiency which could reasonably be expected to be determined adversely to the Company or its subsidiaries and which could reasonably be expected to have) a material adverse effect on the Company and its subsidiaries, taken as a whole.
(gg) The consolidated financial statements included in the Time of Sale Prospectus, together with the related schedules and notes thereto, present fairly in all material respects the consolidated financial position of the Company as of the dates shown and its results of operations and cash flows for the periods shown, and, except as otherwise disclosed in the Time of Sale Prospectus, such financial statements have been prepared in conformity with GAAP applied on a consistent basis throughout the periods covered thereby except for any normal year-end adjustments in the Company’s quarterly financial statements and except as otherwise noted therein.
(hh) PricewaterhouseCoopers SA, who has audited certain financial statements of the Company, is (i) an independent registered public accounting firm with respect to the Company within the meaning of the Securities Act and the applicable rules and regulations thereunder adopted by the Commission and the Public Company Accounting Oversight Board (United States) and (ii) an independent statutory auditor with respect to the Company
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and a state regulated audit firm (société d'audit réglementée par l'État) under the applicable provisions of the CO, and the Swiss Audit Oversight Act (Loi fédérale sur l’agrément et la surveillance des réviseurs) and any ordinances promulgated thereunder, respectively.
(ii) The Company (i) has not alone engaged in any Testing-the-Waters Communication other than Testing-the-Waters Communications with the consent of the Representatives with entities that are qualified institutional buyers within the meaning of Rule 144A under the Securities Act or institutions that are accredited investors within the meaning of Rule 501 under the Securities Act and (ii) has not authorized anyone other than the Representatives to engage in Testing-the-Waters Communications. The Company reconfirms that the Representatives have been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The Company has not distributed any Written Testing-the-Waters Communications other than those listed on Schedule III hereto. “Testing-the-Waters Communication” means any oral or written communication with potential investors undertaken in reliance on Section 5(d) or 163B of the Securities Act. Written Testing-the-Waters Communication” means any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act.
(jj) As of the time of each sale of the Securities in connection with the offering when the Prospectus is not yet available to prospective purchasers, none of (A) the Time of Sale Prospectus, (B) any free writing prospectus, when considered together with the Time of Sale Prospectus, and (C) any individual Written Testing-the-Waters Communication, when considered together with the Time of Sale Prospectus, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(kk) Except as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, no stamp, documentary, issuance, registration, transfer, withholding or other taxes or duties are payable by or on behalf of the Underwriters, the Company or any of its subsidiaries in Switzerland or to any taxing authority thereof or therein in connection with (i) the execution, delivery or consummation of this Agreement, (ii) the creation, allotment and issuance of the Securities, (iii) the sale and delivery of the Shares to the Underwriters or purchasers procured by the Underwriters, (iv) the sale and delivery of the Pre-Funded Warrants to the purchasers procured by the Underwriters, or (v) the resale and delivery of the Shares by the Underwriters in the manner contemplated herein.
(ll) It is not necessary under the laws of Switzerland (i) to enable the Underwriters to enforce their rights under this Agreement, to enable any holder of the Securities to enforce their respective rights thereunder, provided that they are not otherwise engaged in business in Switzerland or (ii) solely by reason of the execution, delivery or consummation of this Agreement for any of the Underwriters or any holder of the Shares or Pre-Funded Warrants of the Company to be qualified or entitled to carry out business in Switzerland.
(mm) This Agreement is in proper form under the laws of Switzerland for the enforcement thereof against the Company, and to ensure the legality, validity, enforceability or admissibility into evidence in Switzerland of this Agreement.
(nn) The courts of Switzerland would recognize as a valid judgment any final monetary judgment obtained against the Company in the courts of the State of New York, unless the judgment would be deemed incompatible with Swiss public policy.
(oo) Neither the Company nor any of its subsidiaries has any immunity from the jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution or otherwise) under the laws of Switzerland; provided, however, that (i) such choice of law may not extend to non-contractual obligations, (ii) the contents of the chosen law of the State of New York may need to be proven as a matter of fact and (iii) a Swiss court would apply Swiss procedural rules. The irrevocable and unconditional waiver and agreement of the Company contained in Section 18 not to plead or claim any such immunity in any legal action, suit or proceeding based on this Agreement is valid and binding under the laws of Switzerland.
(pp) The choice of law of the State of New York as the governing law of this Agreement is a valid choice of law under the laws of Switzerland and will be honored by the courts of Switzerland, provided,
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however, that (i) such choice of law may not extend to non-contractual obligations, (ii) the contents of the chosen law of the State of New York may need to be proven as a matter of fact and (iii) a Swiss court would apply Swiss procedural rules. The Company has the power to submit, and pursuant to Section 18 has, to the extent permitted by law, legally, validly, effectively and irrevocably submitted, to the jurisdiction of the Specified Courts (as defined in Section 18), and has the power to designate, appoint and empower, and pursuant to Section 19, has legally, validly and effectively designated, appointed and empowered an agent for service of process in any suit or proceeding based on or arising under this Agreement in any of the Specified Courts.
(qq) Neither the Company nor any of its subsidiaries or affiliates has any securities rated by any “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) of the Exchange Act.
(rr) Nothing has come to the attention of the Company that has caused the Company to believe that the statistical and market-related data included in the Registration Statement, the Time of Sale Prospectus and the Prospectus is not based on or derived from sources that are reliable and accurate.
(ss) Except as described in each of the Registration Statement, the Prospectus or the Time of Sale Prospectus, and except as would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) the pre-clinical studies and clinical trials conducted by or, to the knowledge of the Company, on behalf of or sponsored by the Company or its subsidiaries or in which the Company or its subsidiaries have participated, that are described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, or the results of which are referred to in the Registration Statement, the Time of Sale Prospectus and the Prospectus, as applicable, were, and if still pending are, being conducted in accordance with the protocols submitted to the U.S. Food and Drug Administration (the “FDA”), the Swiss Agency for Therapeutic Products (“swissmedic”), and other applicable regulatory authorities (including, without limitation, any foreign, federal, state or local governmental or regulatory authority performing functions similar to those performed by the FDA, FOPH, swissethics and swissmedic) (collectively, the “Regulatory Authorities”), the applicable rules and regulations of the Regulatory Authorities, and current Good Clinical Practices and Good Laboratory Practices; (ii) the descriptions in the Registration Statement, the Time of Sale Prospectus and the Prospectus of the results of such studies and trials are accurate and fairly present the data derived therefrom; (iii) the Company has no knowledge of any other studies or trials not described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, the results of which call into question the results described or referred to in the Registration Statement, the Time of Sale Prospectus and the Prospectus; (iv) the Company and its subsidiaries have operated at all times and are currently in material compliance with all applicable statutes, rules and regulations of the Regulatory Authorities; and (v) neither the Company nor any of its subsidiaries have received any written notices, correspondence or other communications from the Regulatory Authorities or any other governmental agency requiring or threatening the termination, modification or suspension of any pre-clinical studies or clinical trials that are described in the Registration Statement, the Time of Sale Prospectus and the Prospectus or the results of which are referred to in the Registration Statement, the Time of Sale Prospectus and the Prospectus, other than ordinary course communications with respect to modifications in connection with the design and implementation of such studies or trials, and, to the Company’s best knowledge, there are no reasonable grounds for the same.
(tt) Except as described in each of the Registration Statement, the Prospectus or the Time of Sale Prospectus and except as would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Company has not failed to file with the Regulatory Authorities any required filing, declaration, listing, registration, report or submission that is a responsibility with the Company with respect to the Company’s product candidates that are described or referred to in the Registration Statement, the Time of Sale Prospectus and the Prospectus; all such filings, declarations, listings, registrations, reports or submissions were to the Company’s knowledge in compliance with applicable laws when filed; and to the Company’s knowledge no deficiencies regarding compliance with applicable law have been asserted by any applicable Regulatory Authority with respect to any such filings, declarations, listings, registrations, reports or submissions.
(uu) Except as described in each of the Registration Statement, the Prospectus or the Time of Sale Prospectus and except as would be reasonably expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Company and its subsidiaries are, and at all times have been, in compliance with all applicable Health Care Laws. For purposes of this Agreement, “Health Care Laws” means: (i) the Federal Food, Drug, and Cosmetic Act (21 U.S.C. §§ 301 et seq.), the Public Health Service Act (42 U.S.C. §§ 201 et seq.); (ii) all
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applicable federal, state, local and all applicable foreign health care related fraud and abuse laws, including, without limitation, the U.S. Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)), the U.S. False Statements Law (42 U.S.C. § 1320a-7b(a)), the Civil Monetary Penalties Law (42 U.S.C. §1320a-7a), the U.S. Civil False Claims Act (31 U.S.C. § 3729 et seq.), all criminal laws relating to health care fraud and abuse, including but not limited to 18 U.S.C. §§ 286 and 287, and the health care fraud criminal provisions under the U.S. Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) (42 U.S.C. §§ 1320d et seq.), the Physician Payments Sunshine Act (42 U.S.C. § 1320a-7h), the exclusion law (42 U.S.C. §1320a-7); (iii) HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (42 U.S.C. §§ 17921 et seq.); (iv) regulations promulgated pursuant to such statutes; and (v) any and all other applicable federal, state, or foreign health care laws and regulation applicable to the ownership, testing, development, manufacture, packaging, processing, use, distribution, marketing, advertising, labeling, promotion, sale, offer for sale, storage, import, export or disposal of any product manufactured or distributed by the Company. Neither the Company nor its subsidiaries has received written notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any court or arbitrator or governmental or regulatory authority or third party alleging that it is in violation of any Health Care Laws, and, to the Company’s knowledge, no such claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action is threatened. Neither the Company nor its subsidiaries, nor their respective officers, directors, employees, contractors or agents, is a party to any corporate integrity agreements, monitoring agreements, consent decrees, settlement orders, or similar agreements with or imposed by any governmental or regulatory authority. Additionally, neither the Company nor any of its employees, officers, directors, contractors or agents, nor its subsidiaries or any of the subsidiary’s employees, officers, directors, contractors or agents, has been excluded, suspended or debarred from participation in any U.S. federal health care program (as defined in 42 U.S.C. § 1320a-7b(f)) or human clinical research or, to the knowledge of the Company, is subject to a governmental inquiry, investigation, proceeding, or other similar action that could reasonably be expected to result in such debarment, suspension, or exclusion. The Company and its subsidiaries have filed, obtained, maintained or submitted all material reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments as required by the Health Care Laws, and all such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were timely, complete, accurate and not misleading on the date filed in all material respects (or were corrected or supplemented by a subsequent submission).
(vv) Except as described in each of the Registration Statement, the Prospectus or the Time of Sale Prospectus and except as would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) there has been no security breach or incident, unauthorized access or disclosure, or other compromise of the Company and its subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software, websites, applications, technology, data and databases, including Personal Data (defined below), the data and information of their respective customers and employees, and any sensitive, confidential or regulated data maintained, processed or stored by the Company and its subsidiaries (collectively, “IT Systems and Data”); (ii) the IT Systems and Data are adequate for, and operate and perform as required in connection with the operation of the business of the Company and its subsidiaries as currently conducted; (iii) the Company and its subsidiaries have used commercially reasonable efforts to implement and maintain, and have implemented and maintained, commercially reasonable information technology, information security, cyber security and data protection controls, policies and procedures, including oversight, access controls, encryption, physical, technological and administrative safeguards and controls, and business continuity/disaster recovery and security plans that are designed to protect against and prevent security breaches, unauthorized use or access, disablement, misappropriation, modification, or other compromise or misuse of the IT Systems and Data, and maintain and protect their material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and Data used in connection with the operation of the Company’s and its subsidiaries’ businesses, which are reasonably consistent with industry standards. “Personal Data” means (i) a natural person’s name, street address, telephone number, e-mail address, photograph, social security number or tax identification number, driver’s license number, passport number, credit card number, bank information, or customer or account number; (ii) “personal data” as defined by GDPR (defined below); (iii) any information which would qualify as “protected health information” under HIPAA; and (iv) any other piece of information that (A) is regulated by an applicable privacy law, regulation or contract and (B) allows the identification of such natural person, or his or her family, or permits the collection or analysis of any data related to an identified person’s health or sexual orientation.
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(ww) Except as described in each of the Prospectus, the Registration Statement or the Time of Sale Prospectus and except as would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) the Company and each of its subsidiaries have complied, and are presently in compliance, with all applicable internal and external privacy policies, contractual obligations, applicable state, federal and international data privacy and security laws and regulations, including without limitation, HIPAA, the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679), and other statutes, judgments, orders, rules and regulations of any applicable court or arbitrator or other governmental or regulatory authority (collectively, the “Data Security Obligations”); (ii) the Company has not received from any applicable governmental authority any written notification of or written complaint alleging non-compliance by the Company or its subsidiaries with any Data Security Obligation; (iii) there is no action, suit or proceeding by or before any applicable court or governmental agency, authority or body pending or threatened in writing alleging non-compliance by the Company or its subsidiaries; (iv) to ensure compliance with the Data Security Obligations, the Company and its subsidiaries have at all times had in place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis of Personal Data that is subject to the Data Security Obligations (the “Policies”); and (v) the Company and its subsidiaries have made all disclosures of its then-current Policies to users or customers required by applicable laws and regulatory rules or requirements, and none of such disclosures made or contained in any Policy have, to the knowledge of the Company, been inaccurate or in violation of any applicable laws and regulatory rules or requirements.
(xx) The Company maintains disclosure controls and procedures that comply with the requirements of the Exchange Act; such disclosure controls and procedures have been designed to ensure that material information relating to the Company is made known to the Company’s principal executive officer and principal financial officer by others within the Company; and such disclosure controls and procedures are effective at the reasonable assurance level.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the terms and conditions hereinafter stated, agrees, severally and not jointly, to purchase from the Company the respective number of Shares and the Pre-Funded Warrants set forth in Schedule I hereto opposite its name at $4.6060 per Share and $4.5233 per Pre-Funded Warrant (the “Purchase Price”). For the avoidance of doubt, the several Underwriters will deduct the Aggregate Capital Increase Amount (as defined below), or the United States dollar amount paid by Jefferies LLC to acquire Swiss francs sufficient to pay the Aggregate Capital Increase Amount pursuant to Section 5, as applicable, from the aggregate Purchase Price for the Shares payable by the several Underwriters to the Company.
3. Terms of the Offering. The Company is advised by the Representatives that the Underwriters propose to make an offering of their respective portions of the Shares and the Pre-Funded Warrants as soon after this Agreement have become effective as in the Representatives’ judgment is advisable. The Company is further advised by the Representatives that the Shares are to be offered initially at $4.90 per share and $4.812 per Pre-Funded Warrant (the “Offering Price”).
4. Payment and Delivery. Payment for the Securities shall be made to the Company in Federal or other funds immediately available in New York City against delivery of the (A) Shares for the respective accounts of the several Underwriters and (B) Pre-Funded Warrants to the Representatives or to the purchasers thereof, at 10:00 a.m. (New York City time) on May 8, 2024 or at such other time on the same or such other date, not later than the five business days thereafter, as shall be designated in writing by the Representatives. The time and date of such payment are hereinafter referred to as the “Closing Date.” The Shares shall be registered in such names and in such denominations as the Representatives shall request in writing not later than one full business day prior to the Closing Date. Notwithstanding the foregoing, the Company and the Representatives shall instruct purchasers of the Pre-Funded Warrants to make payment for the Pre-Funded Warrants on the Closing Date to the Company by wire transfer in immediately available funds to the account specified by the Company at the Offering Price per Pre-Funded Warrant, in lieu of payment by the Underwriters for such Pre-Funded Warrants, and the Company shall deliver the Pre-Funded Warrants to such purchasers on the Closing Date in definitive form against such payment, in lieu of the Company’s obligation to deliver such Pre-Funded Warrants to the Underwriters. In the event that the purchasers of the Pre-Funded Warrants fail to make payment to the Company for all or part of the Pre-Funded
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Warrants on the Closing Date, the Representatives may elect, by written notice to the Company, to purchase additional Shares in lieu of all or a portion of such Pre-Funded Warrants, to be delivered to the Underwriters under this Agreement at the Purchase Price per Share. The aggregate Purchase Price for the Shares payable by the Underwriters shall be reduced by (i) the Aggregate Capital Increase Amount (as defined below), or the United States dollar amount paid by Jefferies LLC to acquire Swiss francs sufficient to pay the Aggregate Capital Increase Amount pursuant to Section 5, as applicable, (ii) any transfer taxes paid by, or on behalf of, the Underwriters in connection with the transfer of the Shares to the Underwriters duly paid, (iii) any withholding required by law, and (iv) $0.2887 per Pre-Funded Warrant.
5. Delivery of Treasury Shares, Capital Increase and Initial Subscription.
(a) The Company shall source the Shares sold hereunder from 3,000,000 existing Common Shares held by the Company or one of its subsidiaries in treasury (“Treasury Shares”) and shall issue the remaining 10,411,912 Shares out of the Company’s capital range as further specified below.
(b) The Company confirms that:
(i) Pursuant to its articles of association, the Board of Directors of the Company (the “Board”) may effect an increase of the Company’s share capital in a maximum amount of CHF 3,561,677.84 by issuing up to 44,520,973 Common Shares, with a nominal value of CHF 0.08 each, out of the Company’s capital range, such capital range having been approved by resolution of the shareholders meeting of June 14, 2023; and
(ii) Before 3:00 a.m. (New York City time) on the Closing Date, the Board will resolve on an increase in the share capital of the Company (décision d'exécution) from CHF 7,123,355.68 to CHF 7,956,308.64, i.e., by an amount of CHF 832,952.96, by issuing 10,411,912 new Common Shares, at an issue price of CHF 0.08 per Common Share, to be fully paid up in cash, from the capital range for the purpose of the offering (the “Capital Increase”), whereby all statutory pre-emptive rights to which the shareholders of the Company are entitled under Swiss law have been validly excluded.
(c) Jefferies LLC, acting on behalf of the several Underwriters, agrees, on the basis of the representations, warranties and agreements herein contained, to:
(i) deposit, same-day funds for value, no later than at 4:00 a.m. (New York City time) on the business day prior to the Closing Date or such other time and date as agreed between the Company and the Jefferies LLC, an amount corresponding to CHF 0.08 multiplied by the number of Shares to be purchased under this Agreement (rounded up, if necessary, to the next multiple of CHF 0.05) (the “Aggregate Capital Increase Amount”) with Credit Suisse (Suisse) SA, a Swiss banking institution (the “Capital Increase Bank”), in a blocked account for such capital increase (Kapitaleinzahlungskonto) with the IBAN CH03 0483 5185 7568 8101 0, made out to the Company’s name (the “Capital Increase Account”), allowing the Capital Increase Bank to issue and deliver a written confirmation of payment of the Aggregate Capital Increase Amount (confirmation de versement de capital) to the Company no later than at 6:00 a.m. (New York City time) on the business day prior to the Closing Date or such other time and date as agreed between the Company and Jefferies LLC; and
(ii) subscribe (through Jefferies LLC) for all the Shares at the issue price (montant d'émission) of CHF 0.08 per Share corresponding to the nominal value for each Share and to deliver the corresponding subscription form (bulletin de souscription) in the form of Exhibit B hereto to the Company no later than at 6:00 a.m. (New York City time) on the business day prior to the Closing Date, or such other time and date as agreed between the Company and Jefferies LLC.
(d) Upon performance of the actions and receipt of the documents referred to in Section 5(c) and before 3:00 a.m. (New York City time) on the Closing Date, or such other time and date as agreed between the Company and the Representatives, the Board will:
(i) adopt a report on the Capital Increase (rapport d'augmentation de capital) in accordance with Swiss law (article 652e CO);
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(ii) procure that a licensed auditor verifies the report on the Capital Increase in accordance with article 652f CO and confirms in writing that it is complete and accurate (attestation de vérification), in accordance with Swiss law;
(iii) resolve in the form of a duly notarized deed on the Capital Increase as set forth in article 652g CO and make all amendments to the articles of association of the Company necessary in connection with the Capital Increase (décision de constatation et de modification des statuts); and
(iv) promptly thereafter, but no later than 4:00 a.m. (New York City time) on the Closing Date, file the documents necessary for the registration of the Capital Increase with the Commercial Register of the Canton of Vaud;
provided, however, that if this Agreement is terminated pursuant to Section 11 prior to the Company filing the relevant resolutions with the Commercial Register of the Canton of Vaud, (A) the Company undertakes not to resolve on the Capital Increase (if it has not already done so) and not to file the relevant resolutions with the Commercial Register of the Canton of Vaud, and (B) the Company shall promptly cause the Capital Increase Bank to release the Aggregate Capital Increase Amount in full to Jefferies LLC, acting on behalf of the several Underwriters, as soon as practicable; and the Underwriters understand that the Capital Increase Bank may require confirmation, including from the Underwriters, to release the Aggregate Capital Increase Amount and the Underwriters agree to deliver such confirmation.
(e) Immediately after the registration of the Capital Increase in the Commercial Register of the Canton of Vaud pursuant to Section 5(d), but in no event later than 9:15 a.m. (New York City time) on the Closing Date, the Company will:
(i) deliver by way of email to the Representatives, the share registrar of the Company, Homburger AG and Lenz & Staehelin pdf-copies of, (A) the certified excerpt of the journal entry (journal) or the certified excerpt from the Commercial Register of the Canton of Vaud evidencing the Capital Increase, (B) the certified updated articles of association of the Company evidencing the Capital Increase, and (C) the Company’s book of uncertificated securities (registre des droits-valeurs) duly signed by the Company’s share registrar and evidencing Jefferies LLC, acting on behalf of the several Underwriters in proportion of their respective holdings set out in Schedule I hereto, as first holder of the Shares; and
(ii) take all steps necessary to ensure that the Shares will be (A) issued to Jefferies LLC, acting on behalf of the several Underwriters, (B) duly recorded as intermediated securities (titres intermédiés) in DTC, (C) duly recorded in an account of Jefferies LLC at DTC, and (D) freely transferable (subject to any applicable restrictions set forth in the articles of association of the Company), all on the Closing Date and in accordance with the instructions of the Representatives.
6. Conditions to the Underwriters’ Obligations. The obligations of the Company to sell the Securities to the Underwriters and the several obligations of the Underwriters to purchase and pay for the Securities on the Closing Date are subject to the condition that no stop order suspending the effectiveness of the Registration Statement or any part thereof has been issued and no proceedings for that purpose or pursuant to Section 8A of the Securities Act have been instituted or are pending or contemplated under the Securities Act.
The several obligations of the Underwriters are subject to the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus that, in the Representatives’ judgment, is material and adverse and that makes it, in the Representatives’ judgment, impracticable to market the Securities on the terms and in the manner contemplated in the Time of Sale Prospectus.
(b) The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of the Company, to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all
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of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date. The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.
(c) Jefferies LLC, the share registrar of the Company, Homburger AG and Lenz & Staehelin shall have received pdf-copies of (A) the certified excerpt of the journal entry (journal) or the certified excerpt from the Commercial Register of the Canton of Vaud evidencing the Capital Increase, (B) the certified updated articles of association of the Company evidencing the Capital Increase, and (C) the Company’s book of uncertificated securities (registre des droits-valeurs) duly signed by the Company’s share registrar and evidencing Jefferies LLC, acting on behalf of the several Underwriters in proportion of their respective holdings set out in Schedule I hereto, as first holder of the Shares.
(d) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Davis Polk & Wardwell LLP, outside counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Underwriters.
(e) The Underwriters shall have received on the Closing Date an opinion of Homburger AG, Swiss counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Underwriters.
(f) The Underwriters shall have received on the Closing Date an opinion of Medler Ferro Woodhouse & Mills PLLC, outside intellectual property counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the underwriters.
(g) The Underwriters shall have received on the Closing Date an opinion of Foley & Lardner LLP, outside intellectual property counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Underwriters.
(h) The Underwriters shall have received on the Closing Date an opinion of Mewburn Ellis LLP, outside intellectual property counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Underwriters.
(i) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Cooley LLP, counsel for the Underwriters, dated the Closing Date, in form and substance satisfactory to the Underwriters.
With respect to Section 6(d) and 6(i) above, Davis Polk & Wardwell LLP and Cooley LLP, respectively, may state that their opinions and beliefs are based upon their participation in the preparation of the Registration Statement, the Time of Sale Prospectus and the Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification, except as specified.
The opinions of Davis Polk & Wardwell LLP, Homburger AG, Medler Ferro Woodhouse & Mills PLLC, Foley & Lardner LLP and Mewburn Ellis LLP described in Section 6(d), 6(e), 6(f), 6(g) and 6(h) above shall be rendered to the Underwriters at the request of the Company, as the case may be, and shall so state therein.
(j) The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from PricewaterhouseCoopers SA, independent public accountants, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than two business days prior to the date thereof.
(k) The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between Jefferies LLC and the officers (as defined in Section 16 of the Exchange Act) and directors of the Company relating to sales and certain other dispositions of Common Shares or certain other securities, delivered to the Representatives on or before the date hereof, shall be in full force and effect on the Closing Date.
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7. Covenants of the Company. The Company covenants with each Underwriter as follows:
(a) To take all steps reasonably required to implement the Capital Increase.
(b) The Company undertakes to keep an uncertificated securities book (registre des droits-valeurs) in accordance with article 973c paragraph 2 CO.
(c) To furnish to the Representatives, without charge, two signed copies of the Registration Statement (including exhibits thereto and documents incorporated by reference) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto but including documents incorporated by reference) and to furnish to the Representatives in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 7(i) or 7(j) below, as many copies of the Time of Sale Prospectus, the Prospectus, any documents incorporated by reference therein and any supplements and amendments thereto or to the Registration Statement as the Representatives may reasonably request; provided, however, that the requirements of this Section 7(c) shall be satisfied to the extent that such documents are available on EDGAR.
(d) All sums payable by the Company under this Agreement shall be paid free and clear of and without deductions or withholdings of any present or future taxes or duties, unless the deduction or withholding is required by law, in which case the Company shall pay such additional amount as will result in the receipt by each Underwriter of the full amount that would have been received had no deduction or withholding been made.
(e) All sums payable to an Underwriter shall be considered exclusive of any value added or similar taxes. Where the Company is obliged to pay value added or similar tax on any amount payable hereunder to an Underwriter, the Company shall in addition to the sum payable hereunder pay an amount equal to any applicable value added or similar tax.
(f) Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to the Representatives a copy of each such proposed amendment or supplement and not to file or publish any such proposed amendment or supplement to which the Representatives reasonably object, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.
(g) To furnish to the Representatives a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which the Representatives reasonably object.
(h) Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.
(i) If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.
(j) If, during such period after the first date of the offering of the Shares as in the opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is
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required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses the Representatives will furnish to the Company) to which Shares may have been sold by the Representatives on behalf of the Underwriters and to any other dealers upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.
(k) To endeavor to qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request; provided, however, that nothing contained herein shall require the Company to qualify to do business in any jurisdiction, to execute or file a general consent to serve of process in any jurisdiction or to subject itself to taxation in any jurisdiction in which it is not otherwise subject.
(l) To make generally available to the Company’s shareholders and to the Representatives as soon as practicable an earning statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.
(m) Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel and the Company’s accountants in connection with the registration and delivery of the Securities under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters and the delivery of the Pre-Funded Warrants to the Underwriters or purchasers thereof, including any transfer or other taxes payable thereon, (iii) the reasonable, documented cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Securities under state securities laws and all expenses in connection with the qualification of the Securities for the offer and sale under state securities laws as provided in Section 7(k) hereof, including filing fees and the reasonable, documented fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum (provided that the amount payable by the Company with respect to fees and disbursements of counsel for the Underwriters pursuant to this subsection shall not exceed $20,000), (iv) [reserved], (v) all costs and expenses incident to listing the Shares and Warrant Shares on NYSE and other national securities exchanges and foreign stock exchanges, (vi) the cost of printing certificates representing the Shares and Warrant Shares, if applicable, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Securities, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, fifty percent (50%) of the cost of any aircraft chartered in connection with the road show to be used by both the Company and Underwriters with the prior approval of the Company (the remaining fifty percent (50%) of the cost of such aircraft to be paid by the Underwriters), (ix) the document production charges and expenses associated with printing this Agreement, and (x) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section, Section 9 entitled “Indemnity and Contribution”, and the last paragraph of Section 11 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, stock transfer taxes payable on resale of any of the Securities by them and any
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advertising expenses connected with any offers they may make and all travel and other expenses of the Underwriters or any of their employees incurred by them in connection with participation in investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Securities, other than the cost of aircraft chartered in connection with the road show with the prior approval of the Company, for which the Underwriters agree to pay for the other fifty percent (50%) not paid for by the Company, as described above.
(n) If at any time following the distribution of any Written Testing-the-Waters Communication there occurred or occurs an event or development as a result of which such Written Testing-the-Waters Communication 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 existing at that subsequent time, not misleading, the Company will promptly notify the Representatives and will promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.
(o) The Company shall pay, and shall indemnify and hold the Underwriters harmless against, any stamp, issue, registration, documentary, sales, transfer or other similar taxes or duties imposed under the laws of Switzerland or any political sub-division or taxing authority thereof or therein that is payable in connection with (i) the execution, delivery, consummation or enforcement of this Agreement, (ii) the creation, allotment and issuance of the Securities or (iii) the sale and delivery of the Shares and the Pre-Funded Warrants to the Underwriters or purchasers procured by the Underwriters.
(p) The Company shall, at all times while any Pre-Funded Warrants are outstanding, reserve and keep available out of its conditional capital for financing purposes, or treasury shares held by the Company, solely for the purpose of enabling it to issue Warrant Shares upon exercise of such Pre-Funded Warrants, the number of Warrant Shares that are issuable and deliverable upon the exercise of the then-outstanding Warrants and the Pre-Funded Warrants from time to time.
The Company also covenants with each Underwriter that, without the prior written consent of Jefferies LLC on behalf of the Underwriters, it will not, during the period ending 60 days after the date of the Prospectus (the “Restricted Period”), (1) issue, 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, grant any instruction rights pursuant to article 25 of the Swiss Federal Act on Intermediated Securities (droits d'instruction) or otherwise transfer or dispose of (or publicly announce any such issuance, offer, sale or disposal), directly or indirectly, any Common Shares or any securities convertible into or exercisable or exchangeable for Common Shares or (2) enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Shares, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Shares or such other securities, in cash or otherwise, (3) file any registration statement with the Commission relating to the offering of any Common Shares or any securities convertible into or exercisable or exchangeable for Common Shares or (4) announce its intention to do any of the foregoing.
The restrictions contained in the preceding paragraph shall not apply to (a) the Shares and the Pre-Funded Warrants to be sold hereunder or the Warrant Shares, (b) the issuance by the Company of Common Shares upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and described in the Time of Sale Prospectus of which the Underwriters have been advised in writing, (c) the grant or settlement of options, restricted shares or restricted share units to officers, directors, employees and consultants of the Company or its subsidiaries under any incentive compensation plan in effect or approved by the Board on the date hereof and described in the Time of Sale Prospectus or the issuance by the Company of Common Shares upon the exercise of options outstanding on the date hereof or the filing by the Company of a registration statement with the Commission on Form S-8 in connection therewith, (d) the offer or issuance by the Company of Common Shares in connection with an acquisition, joint venture, commercial or collaborative relationship or the acquisition or license by the Company of the securities, business, property or other assets of another person or entity or pursuant to any employee benefit plan as assumed by the Company in connection with any such acquisition (provided that the aggregate number of Common Shares that the Company may offer or issue pursuant to this clause (d) shall not exceed 10% of the total number of Common Shares issued and outstanding immediately following the completion of the transactions contemplated by this Agreement) and the recipient of any such Common Shares enters into a written agreement substantially in the form of Exhibit A hereto, (e) the establishment of a trading plan pursuant to
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Rule 10b5-1 under the Exchange Act for the transfer of Common Shares or other securities, provided that (x) such plan does not provide for the transfer of Common Shares during the Restricted Period and (y) to the extent a public announcement or filing under the Exchange Act is required of or voluntarily made by the Company during the Restricted Period regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Shares or other securities may be made under such plan during the Restricted Period or (f) the filing (including the effectiveness) of registration statements and prospectuses (including amendments and supplements thereto) with the Commission exclusively as a result of contractual obligations contained in existing registration rights agreements described in the Time of Sale Prospectus.
8. Covenants of the Underwriters. Each Underwriter severally covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.
9. Indemnity and Contribution. (a) The Company agrees to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any road show as defined in Rule 433(h) under the Securities Act (a “road show”), or the Prospectus or any amendment or supplement thereto, or any Written Testing-the-Waters Communication caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein, it being understood that the only such information is the Underwriter Information.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, the Company’s directors, the Company’s officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use in the Registration Statement, or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus, road show or the Prospectus or any amendment or supplement thereto, or any Written Testing-the-Waters Communication, it being understood that the only such information is the Underwriter Information.
(c) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 9(a) or 9(b), such person (the “indemnified party”) shall promptly notify the person against whom such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the reasonably incurred, documented fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them or (iii) the indemnified party shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the indemnifying party. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in
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the same jurisdiction, be liable for (i) the fees and expenses of more than one separate firm (in addition to any local counsel) for all Underwriters and all persons, if any, who control any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act or who are affiliates of any Underwriter within the meaning of Rule 405 under the Securities Act and (ii) the reasonably incurred fees and expenses of more than one separate firm (in addition to any local counsel) for the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either such Section. In the case of any such separate firm for the Underwriters and such control persons and affiliates of any Underwriters, such firm shall be designated in writing by the Representatives. In the case of any such separate firm for the Company, and such directors, officers and control persons of the Company, such firm shall be designated in writing by the Company. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding 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 includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
(d) To the extent the indemnification provided for in Section 9(a) or 9(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Securities or (ii) if the allocation provided by clause 9(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 9(d)(i) above but also the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or parties on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Securities shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Securities (before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Offering Price of the Securities. The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters’ respective obligations to contribute pursuant to this Section 9 are several in proportion to the respective number of Securities they have purchased hereunder, and not joint. The liability of the Company under the contribution agreement contained in this paragraph shall be limited to an amount equal to the aggregate Offering Price of the Securities sold by the Company under this Agreement.
(e) The Company and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 9(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 9(d) shall be deemed to include, subject to the limitations set forth above, 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 9, no
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Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Securities underwritten by it and distributed and offered to the investors exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this Section 9 and the representations, warranties and other statements of the Company contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter, or by or on behalf of the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Securities.
10. Termination. The Underwriters may terminate this Agreement by notice given by the Representatives to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date, as the case may be, (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, the SIX Swiss Exchange, NYSE, the NYSE American, or the Nasdaq Global Market (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States or Switzerland shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal, New York State, Swiss or relevant foreign country authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in the Representatives’ judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in the Representatives’ judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Securities on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.
11. Effects of Termination on Shares.
(a) If, after application and registration of the Capital Increase with the Commercial Register of the Canton of Vaud pursuant to Section 5(d), prior to the Closing Date, this Agreement is terminated pursuant to Section 10, or if the delivery of the Shares to Jefferies LLC acting on behalf and for the account of the several Underwriters is not completed on the Closing Date (an “Event of Non-Completion”), and unless the Company and the Representatives, acting on behalf of the several Underwriters, otherwise agree within ten calendar days after the Event of Non-Completion, then:
(i) the Company shall have a call option pursuant to Section 11(b);
(ii) if the call option is not exercised, the Representatives acting on behalf of the several Underwriters shall have a put option against the Company pursuant to Section 11(c);
(iii) if the put option is not possible for legal reasons or insufficient to dispose of the Shares or if such put option is not exercised within the deadline set forth in Section 11(c), the Company shall effect a capital reduction pursuant to Section 11(d); and
(iv) if the capital reduction is not effected in accordance with Section 11(d), the Underwriters may sell the Shares in the market as provided in Section 11(e).
(b) Call Option.
(i) The Company, acting on its own behalf or on behalf of third parties, shall have the right (the “Call Option”) to request in writing that Jefferies LLC, acting on behalf of the several Underwriters, delivers the Shares to an account specified by the Company against payment of an amount representing the Aggregate Capital Increase Amount plus expenses of the Representatives as set out in Section 11(f). The Call Option shall expire on the tenth calendar day after the Event of Non-Completion.
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(ii) An acquisition of the Shares by the Company for its own account shall only be permitted if the Company has delivered evidence to the Representatives reasonably satisfactory to the Representatives that the Company has sufficient freely available reserves to acquire the Shares under this Section 11(b) or, alternatively, that the Company has entered into arrangements with a third party other than any of the Company’s subsidiaries ensuring for the immediate on-sale of the Shares to such third party, at no less than an amount representing the Aggregate Capital Increase Amount plus expenses of the Representatives as set out in Section 11(f), on the date of acquisition of the Shares by the Company.
(c) Put Option.
(i) Following the expiry of the Call Option pursuant to Section 11(b), the Representatives, acting on behalf of the several Underwriters, shall have an option (the “Put Option”) to require the Company, subject to article 659 CO, to purchase all Shares entered in the Commercial Register of the Canton of Vaud at a purchase price representing the Aggregate Capital Increase Amount plus expenses of the Representatives as set out in Section 11(f), within ten (10) calendar days after receipt of a notice in writing addressed to the Company from the Representatives, stating that the Representatives exercises the Put Option.
(ii) The notice in which the Representatives exercise the Put Option shall specify the date on which the Representatives will deliver the Shares to the Company against direct payment therefor, and shall contain detailed instructions regarding payment and delivery of the Shares and amount payable (including satisfactory details regarding the costs claimed according to Section 11(f) subject to an agreement to the contrary by the Representatives with the Company).
(d) Capital Reduction.
(i) If the Put Option is not exercised within the deadline set forth in Section 11(c) or exercise or settlement of the Put Option is not possible for legal reasons or insufficient to dispose of the Shares the Company shall use its best efforts to reduce the issued and outstanding share capital of the Company by cancellation of the Shares entered in the Commercial Register of the Canton of Vaud against repayment of an amount representing the Aggregate Capital Increase Amount plus expenses of the Representatives as set out in Section 11(f) (the "Capital Reduction"). To the extent applicable, the Capital Reduction shall take place within the capital range, whereby the Capital Reduction shall be resolved by the Board no later than sixty (60) days after the Event of Non-Completion. If the Capital Reduction is not possible within the capital range for legal reasons, the Company shall immediately call a shareholders’ meeting and table the Capital Reduction. Such shareholders' meeting shall take place no later than sixty (60) calendar days after the Event of Non Completion. The Representatives acting on behalf of the several Underwriters, will vote in favor of the Capital Reduction. The Company shall use its best efforts to cause its auditors to confirm in writing, pursuant to article 653m para. 1 CO, that the claims of the Company’s creditors are fully covered notwithstanding the Capital Reduction. If such confirmation is not issued by the auditors prior to the shareholders’ meeting, the meeting shall be cancelled. The Company shall use its best efforts to cause its shareholders to vote in favor of the Capital Reduction.
(ii) At the earliest possible date, and subject to statutory law, the Capital Reduction shall be consummated by registration in the Commercial Register of the Canton of Vaud. The proceeds of the Capital Reduction, being an amount representing the Aggregate Capital Increase Amount plus expenses of the Representatives as set out in Section 11(f), shall be paid (for value on the date of the entry in the Commercial Register of the Canton of Vaud) in cash to Jefferies LLC, acting on behalf of the several Underwriters.
(iii) Upon consummation of the Capital Reduction, the Company shall deregister the Shares in its book of uncertificated securities (registre des droits-valeurs) to reflect the number of Common Shares registered with the Commercial Register of the Canton of Vaud.
(e) Sale of Shares. In addition, if an Event of Non-Completion occurs and,
(i) the Company fails to acquire or cause a third party to acquire the Shares in accordance with Section 11(b) within ten (10) calendar days after the Event of Non-Completion; and
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(ii) in the event and to the extent the Put Option has not been exercised within the deadline set forth in Section 11(c) and settled or the exercise or settlement of the Put Option is not possible for legal reasons or insufficient to dispose of the Shares; and
(iii) the Capital Reduction has not been resolved by the Board or, as applicable, the shareholders’ meeting of the Company within sixty (60) days after the Event of Non-Completion, or such longer period as may be agreed between the Company and the Representatives;
then the Representatives, acting on behalf of the several Underwriters, are entitled to sell any or all Shares on the open market on terms which the Representatives deem fit under the circumstances. The difference between the proceeds of such sale and an amount representing the Aggregate Capital Increase Amount plus costs and expenses pursuant to Section 11(f) reasonably incurred by the Representatives in connection with the sale, if any, shall be transferred to the Company.
(f) Costs; Indemnity.
(i) The Company shall bear (A) all costs directly incidental to the Capital Reduction, including but not limited to notarization costs, costs of the Commercial Register and costs of publication of the Capital Reduction and (B) the costs of the Representatives reasonably incurred in connection with the Call Option, the Put Option or the Capital Reduction, as applicable (including but not limited to (x) taxes, (y) interest at a rate of the higher of zero or the 3-month CHF LIBOR, calculated on a 30/360 basis, accruing from the Event of Non-Completion until the payment of proceeds to the Representatives, acting on behalf of the several Underwriters, and (z) reasonable out of pocket expenses of the Representatives and their counsel).
(ii) The Company further undertakes to indemnify the Representatives and their respective affiliates for, and to hold the Representatives and their respective affiliates harmless from, any reasonable costs, expenses, third party claims and liabilities, actual or contingent, that may be incurred by or made against the Representatives and their respective affiliates in connection with the Capital Reduction.
12. Effectiveness; Defaulting Underwriters. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date, any one or more of the Underwriters shall fail or refuse to purchase Securities that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Securities which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Securities to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Securities set forth opposite their respective names in Schedule I bears to the aggregate number of Securities set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as the Representatives may specify, to purchase the Securities which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Securities that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 12 by an amount in excess of one-ninth of such number of Securities without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase the Securities and the aggregate number of Securities with respect to which such default occurs is more than one-tenth of the aggregate number of Securities to be purchased on such date, and arrangements satisfactory to the Representatives and the Company for the purchase of the Securities are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter and the Company. In any such case either the Representatives 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, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement, the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves,
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severally, for all reasonably incurred and documented out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder; provided that, the Company shall not be required to reimburse the Underwriters in the event any such termination is effected pursuant to Section 10(i), 10(iii), 10(iv) or 10(v).
13. Entire Agreement. (a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Securities, represents the entire agreement between the Company, on the one hand, and the Underwriters, on the other hand, with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Securities.
(b) The Company acknowledges that in connection with the offering of the Securities: (i) the Underwriters have acted at arm’s length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement and prior written agreements (to the extent not superseded by this Agreement), if any, (iii) the Underwriters may have interests that differ from those of the Company and (iv) none of the activities of the Underwriters in connection with the transactions contemplated herein constitutes a recommendation, investment advice, or solicitation of any action by the Underwriters with respect to any entity or natural person. The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Securities.
14. Counterparts. This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com or www.echosign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
15. Applicable Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.
16. Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.
17. Notices. All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to the Representatives to Jefferies LLC, 520 Madison Avenue, New York, New York 10022, Attention: General Counsel; Guggenheim Securities, LLC, 330 Madison Avenue, New York, New York 10017, Attention Head of Equity Capital Markets; and to Cantor Fitzgerald & Co., 110 East 59th Street, 6th Floor, New York, New York 10022, Attention: Equity Capital Markets, with copies to Cantor Fitzgerald & Co., 110 East 59th Street, 6th Floor, New York, New York 10022, Attention: General Counsel; if to the Company shall be delivered, mailed or sent to ADC Therapeutics SA, Route de la Corniche 3B, 1066 Epalinges, Switzerland, Attention: General Counsel.
18. Submission to Jurisdiction. The Company irrevocably submits to the non-exclusive jurisdiction of any New York State or United States Federal court sitting in The City of New York (the “Specified Courts”) over any suit, action or proceeding arising out of or relating to this Agreement, the Prospectus, the Registration Statement or the offering of the Securities (each, a “Related Proceeding”). The Company irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of venue of any Related Proceeding brought in such a court and any claim that any such Related Proceeding brought in such a court has been brought in an inconvenient forum. To the extent that the Company has or hereafter may acquire any immunity (on the grounds of sovereignty or otherwise) from the jurisdiction of any court or from any legal process with respect to itself or its property, the Company irrevocably waives, to the fullest extent permitted by law, such immunity in respect of any such suit, action or proceeding.
19. Appointment of Agents for Service. The Company has appointed ADC Therapeutics America, Inc., with offices at 430 Mountain Avenue, 4th Floor, Murray Hill, New Jersey, 07974 as its agent for service of process in any Related Proceeding and agrees that service of process in any such Related Proceeding may be made upon it at
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the office of such agent. The Company waives, to the fullest extent permitted by law, any other requirements of or objections to personal jurisdiction with respect thereto. The Company represents and warrants that such agent has agreed to act as the Company’s agent for service of process, and the Company agrees to take any and all action, including the filing of any and all documents and instruments, that may be necessary to continue such appointment in full force and effect.
20. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than United States dollars, the parties hereto agree, to the fullest extent permitted by law, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Underwriters could purchase United States dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligation of the Company with respect to any sum due from it to any Underwriter or any person controlling any Underwriter shall, notwithstanding any judgment in a currency other than United States dollars, not be discharged until the first business day following receipt by such Underwriter or controlling person of any sum in such other currency, and only to the extent that such Underwriter or controlling person may in accordance with normal banking procedures purchase United States dollars with such other currency. If the United States dollars so purchased are less than the sum originally due to such Underwriter or controlling person hereunder, the Company agrees as a separate obligation and notwithstanding any such judgment, to indemnify such Underwriter or controlling person against such loss. If the United States dollars so purchased are greater than the sum originally due to such Underwriter or controlling person hereunder, such Underwriter or controlling person agrees to pay to the Company an amount equal to the excess of the dollars so purchased over the sum originally due to such Underwriter or controlling person hereunder.
21. Taxes. If any sum payable by the Company to the Underwriter under this Agreement is subject to deduction or withholding, under Swiss law, the sum payable to the Underwriter under this Agreement shall be increased to such sum as will ensure that the Underwriter shall be left with the sum it would have had in the absence of such deduction or withholding, provided that no such additional amounts shall be payable as a result of any taxes imposed on the Underwriter by virtue of the Underwriter having or being deemed to have a permanent establishment in, or other connection with, Switzerland other than solely by reason of execution and delivery of this Agreement, the performance by the Underwriter of its obligations hereunder, the consummation of the transactions contemplated hereby and the enforcement of the rights with respect to the foregoing.
22. Recognition of the U.S. Special Resolution Regimes. (a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
For purposes of this Section: (i) a “BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k); (ii) “Covered Entity” means any of the following: (A) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (B) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (C) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b); (iii) “Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable; and (iv) “U.S. Special Resolution Regime” means each of (A) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (B) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
[Signature Pages Follow]
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Very truly yours,
| |||
|
ADC Therapeutics SA
| |||
| By: | /s/ Ameet Mallik | ||
| Name: | Ameet Mallik | ||
| Title: | Chief Executive Officer | ||
Accepted as of the date hereof
Jefferies LLC
Guggenheim Securities, LLC
Cantor Fitzgerald & Co.
Acting on behalf of themselves and the
several Underwriters named in Schedule I hereto
| By: |
Jefferies LLC
|
||
| By: | /s/ Matthew Kim | ||
| Name: | Matthew Kim | ||
| Title: | Managing Director, Joint US Head of Biopharmaceuticals | ||
| By: |
Guggenheim Securities, LLC
|
||
| By: | /s/ Ronald Gerber | ||
| Name: | Ronald Gerber | ||
| Title: | Senior Managing Director | ||
| By: |
Cantor Fitzgerald & Co.
|
||
| By: | /s/ Jason Fenton | ||
| Name: | Jason Fenton | ||
| Title: | Global Co-Head of ECM | ||
Schedule I
| Underwriter | Number of Shares To Be Purchased | Number of Pre-Funded Warrants To Be Purchased | ||||||
| Jefferies LLC | 6,035,361 | 3,673,469 | ||||||
| Guggenheim Securities, LLC | 4,023,573 | 2,448,980 | ||||||
| Cantor Fitzgerald & Co. | 3,352,978 | 2,040,816 | ||||||
| Total: | 13,411,912 | 8,163,265 | ||||||
Schedule II
Time of Sale Prospectus
| 1. | The Basic Prospectus |
| 2. | Preliminary prospectus dated May 6, 2024 |
| 3. | Price per common share offered to investors: $4.90 |
Number of common shares offered: 13,411,912
Price per pre-funded warrant offered to investors: $4.812
Number of pre-funded warrants offered: 8,163,265
There is no option for the Underwriters
to purchase additional common shares.
SCHEDULE III
Written Testing-the-Waters Communications
None.
Exhibit 4.1
WARRANT
TO PURCHASE COMMON SHARES OF
ADC THERAPEUTICS SA
| No. W-PF-[#] | May 8, 2024 |
The undersigned, ADC Therapeutics SA, a Swiss stock corporation (société anonyme) organized under the laws of Switzerland (together with its successors and assigns, the “Company”), hereby grants to [warrant holder name], subject to the terms and conditions herein, the right to subscribe for and purchase, at the Exercise Price per share, the Warrant Shares.
Section 1. Definitions. Capitalized terms used but not otherwise defined in this Warrant shall have the following meanings:
“Affiliates” means any affiliates (as defined in Rule 405 under the Securities Act) of the Warrantholder.
“Articles of Association” means the Articles of Association of the Company, as may be amended, modified, supplemented or restated from time to time in accordance with its terms and pursuant to applicable law.
“Business Day” means any day other than Saturday, Sunday or any other day on which banking institutions in the City of New York or in Lausanne, Switzerland are closed for business.
“Common Shares” means the Company’s common shares, par value CHF 0.08 per share, as presently constituted under the Articles of Association, and any class and/or series of Company capital stock for or into which such common shares may be converted or exchanged in a reorganization, recapitalization or similar transaction.
“Effective Date” means May 8, 2024.
“Exchange” means the New York Stock Exchange, or if the Common Shares are no longer listed on the New York Stock Exchange, the other securities exchange or market on which the Common Shares are then being principally traded.
“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.
“Exercise Date” means, for any given exercise of this Warrant, the date on which the conditions to such exercise as set forth in Section 3(a) shall have been satisfied at or prior to 5:00 P.M., Eastern Time, on a Business Day, including, without limitation, the receipt by the Company of the applicable Exercise Price, it being understood that, if the conditions to such exercise are satisfied after 5:00 P.M., Eastern Time on a Business Day or are satisfied outside of a Business Day, then the Exercise Date shall be deemed to be the next Business Day.
“Exercise Price” means CHF 0.08 per Warrant Share.
“Liquid Sale” means a Merger Event in which the consideration received by the Company’s shareholders consists solely of cash and/or Marketable Securities.
“Marketable Securities,” in connection with a Merger Event, means securities meeting all of the following requirements: (i) the issuer of such securities is then subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act and is then current in its filing of all required reports and other information under the Securities Act and the Exchange Act; (ii) the class and series of such securities that would be received by the Warrantholder in such Merger Event were the Warrantholder to exercise this Warrant on or prior to the closing of such Merger Event is then traded on a national securities exchange or over-the-counter market; and (iii) following the closing of such Merger Event, the Warrantholder would not be restricted from publicly re-selling all of such securities that would be received by the Warrantholder in such Merger Event were the Warrantholder to exercise this Warrant on or prior to the closing of such Merger Event, except to the extent that any such restriction (x) arises solely under federal or state securities laws, rules or regulations, and (y) does not extend beyond six months from the closing of such Merger Event.
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“Merger Event” means any of the following: (i) a sale, lease or other transfer of all or substantially all assets of the Company, (ii) any merger or consolidation involving the Company in which the Company is not the surviving entity or in which the outstanding shares of the Company’s capital stock are otherwise converted into or exchanged for shares of capital stock or other equity securities or property of another entity, or (iii) any sale by holders of the outstanding voting equity securities of the Company in a single transaction or series of related transactions of shares constituting a majority of the outstanding combined voting power of the Company.
“Person” means an individual, corporation, limited liability company, partnership, joint venture, association, trust, unincorporated organization or any other entity.
“Purchase Price” means USD 4.812 multiplied by the number of Warrant Shares on the Effective Date.
"Registration Statement” means the Company’s Registration Statement on Form S-3 (File No. 333-270570), declared effective on March 14, 2024.
“Securities Act” means the United States Securities Act of 1933, as amended.
“Trading Day” means a day on which the Exchange is open for trading.
“VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Shares are then listed or quoted on an Exchange, the daily volume weighted average price of the Common Shares for such date (or the nearest preceding date) on such market as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the Common Shares are not then listed on an Exchange, the volume weighted average price of the Common Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Shares are then reported on The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per Common Share so reported, or (d) in all other cases, the fair market value of a Common Share as determined by the Company’s board of directors in good faith.
“Warrant” means this warrant and any other warrants of like tenor issued in substitution or exchange for any thereof pursuant to the terms of this Warrant.
“Warrantholder” means the initial holder of the Warrant or its registered assign.
“Warrant Shares” means initially [●] Common Shares, and thereafter subject to adjustment as set forth herein, including reduction for each such Common Share as to which this Warrant has been exercised hereunder.
Section 2. Term.
(a) Term. The right to subscribe for and purchase Common Shares as granted herein shall commence on the Effective Date and, subject to Section 6(a), shall be exercisable until 4:00 P.M. (Zurich time) on the tenth anniversary of the Effective Date (such period, the “Term”). The Warrantholder shall not be entitled to the return or refund of all, or any portion, of the Purchase Price for any reason whatsoever, including in the event this Warrant shall not have been exercised during the Term.
(b) Replacement Warrant. At any time during the last 90 calendar days before the end of the Term, the Warrantholder shall have the right to request the Company, upon the Warrantholder’s return of this Warrant, to exchange this Warrant for a new warrant for the Warrant Shares then remaining under this Warrant, in form and substance substantially similar to this Warrant (with a subsequent ten year exercise period) (the “Replacement Warrant”). Within ten Business Days after the receipt of such request and the physical surrender of this Warrant to the Company, the Company shall issue and deliver the Replacement Warrant to the Warrantholder.
(c) Issuance of Securities. The Warrant, as initially issued by the Company, is offered and sold pursuant to the Registration Statement. As of the Effective Date, the Warrant Shares are issuable under the Registration Statement. Accordingly, the Warrant and, assuming issuance pursuant to the Registration Statement or an exchange meeting the requirements of Section 3(a)(9) of the Securities Act, the Warrant Shares, are not “restricted securities” under Rule 144 promulgated under the Securities Act as of the Effective Date.
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Section 3. Exercise of the Purchase Rights.
(a) Exercise. The purchase rights represented by this Warrant are exercisable by the Warrantholder, in whole or in part (but not in relation to any fraction of a Common Share), at any time and from time to time, during the Term by tendering to the Company (by electronic mail in accordance with Section 11(c)) a duly completed and executed notice of exercise in the form attached as Exhibit A hereto (each, a “Notice of Exercise”), and payment of the applicable Exercise Price for all Warrant Shares to which the Notice of Exercise relates; provided that any exercise of the purchase rights represented by this Warrant must be for at least the lesser of (x) 50,000 Warrant Shares and (y) all remaining Warrant Shares available for purchase under this Warrant. Once received by the Company, a Notice of Exercise may not be revoked without the Company’s written consent.
(b) Exercise Price. The Warrantholder must pay the applicable Exercise Price for all Warrant Shares to which the applicable Notice of Exercise relates, in cash and without any deductions (including for bank fees) or withholdings, on the Exercise Date via wire transfer of immediately available funds to the bank account set out in Exhibit A hereto or to any other bank account designated by the Company to the Warrantholder in writing from time to time, unless the cashless exercise procedure specified in Section 3(g) below is specified in the applicable Notice of Exercise.
(c) Issuance of Warrant Shares. The Warrant Shares to be delivered upon the exercise of Warrants shall be, at the election of the Company, existing Common Shares held by the Company or newly issued Common Shares from the Company’s capital range (Kapitalband) or newly issued Common Shares from the Company’s conditional share capital (bedingtes Aktienkapital). Such Warrant Shares shall be in uncertificated form in accordance with article 973c CO as uncertificated securities (Wertrechte). Nothing in this Warrant shall be construed as requiring the Company to hold a certain amount of Common Shares in treasury at any time.
(d) Delivery of Common Shares. In the event of any exercise of the rights represented by this Warrant in accordance with and subject to the terms and conditions hereof, the Common Shares so purchased shall be delivered by the Company by causing the Company’s transfer agent (“Transfer Agent”) to electronically transmit the Common Shares issuable upon such exercise to the Warrantholder by crediting such Warrantholder’s account at the Transfer Agent within two Business Days of the Exercise Date (the “Delivery Deadline”); provided that the Company shall not be in default if the Company is unable to deliver Common Shares by the Delivery Deadline due to the relevant bank’s failure to issue, or delay in issuing, a confirmation of payment of the Exercise Price.
(e) Surrender and Cancellation. Except as provided in Section 2(b), the Warrantholder shall not be required to physically surrender this Warrant to the Company until the Warrantholder has purchased all of the Common Shares available hereunder and this Warrant has been exercised in full, in which case the Warrantholder shall surrender this Warrant to the Company for cancellation within three Business Days following the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant shall lower the number of Warrant Shares available hereunder by an amount equal to the applicable number of Warrant Shares purchased. The Warrantholder and the Company shall maintain records showing the number of Common Shares purchased and the remaining number of Common Shares available hereunder. The Warrantholder and any assignee of the Warrantholder, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Common Shares available hereunder, the Warrant Shares (and, therefore, the number of Common Shares available for purchase hereunder) at any given time may be less than the amount stated herein.
(f) Limitations on Exercise. The Warrantholder shall not have the right to exercise the rights represented by this Warrant, and the Company shall not effect any exercise of this Warrant, to the extent that after giving effect to such exercise, such Warrantholder (together with such Warrantholder’s Affiliates, any Persons acting as a group (as such term is used for purposes of Section 13(d) of the Exchange Act) together with the Warrantholder or its Affiliates, and any other Persons whose beneficial ownership of Common Shares is aggregated with the Warrantholder for purposes of Section 13(d) of the Exchange Act (such Persons, collectively, “Attribution Parties”)) would beneficially own in excess of 9.99% (the “Maximum Percentage”) of Common Shares outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of Common Shares beneficially owned by the Warrantholder and its Affiliates and Attribution Parties shall include the number of Common Shares issuable upon exercise of the rights represented by this Warrant with respect to which
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the determination of such sentence is being made, but shall exclude Common Shares which would be issuable upon (i) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Warrantholder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by the Warrantholder or any of its Affiliates or Attribution Parties (including, without limitation, any convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act, it being acknowledged that the Company is not representing to the Warrantholder that such calculation is in compliance with Section 13(d) of the Exchange Act. To the extent that the limitation contained in this Section 3(f) applies, the determination of whether this Warrant is exercisable and of which portion of this Warrant is exercisable shall be in the sole discretion of the Warrantholder and the submission of a Notice of Exercise shall be deemed to be the Warrantholder determination of whether this Warrant is exercisable and of which portion of this Warrant is exercisable, and the Company shall have no obligation to verify or confirm the accuracy of such determination. For purposes of this Warrant, in determining the number of outstanding Common Shares, the Warrantholder may rely on the number of outstanding Common Shares as reflected in (i) the Company’s most recent Form 10-K or Form 10-Q or other public filing by the Company with the SEC, as the case may be, (ii) a more recent public announcement by the Company or (iii) any other notice by the Company setting forth the number of Common Shares outstanding. Upon the written or oral request of the Warrantholder, which request indicates that it is being made pursuant to this Warrant, the Company shall within two Business Days confirm orally or in writing to the Warrantholder the number of Common Shares then outstanding. Upon delivery of a written notice to the Company, the Warrantholder may from time to time increase or decrease the Maximum Percentage to any other percentage not in excess of 19.99% as specified in such notice; provided that any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the Company. For purposes of clarity, the Common Shares issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the Warrantholder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 3(f) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended beneficial ownership limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
(g) Cashless Exercise. Notwithstanding anything to the contrary set forth herein but subject to Section 3(h), if at any time between when the Warrantholder tenders to the Company a Notice of Exercise and when the Common Shares identified in the Notice of Exercise are delivered to Warrantholder, the Registration Statement is suspended and there is otherwise no effective registration statement registering, or the prospectus contained therein is not available for, the issuance of the Warrant Shares to the Warrantholder, this Warrant may be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Warrantholder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = as applicable: (i) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof after the close of “regular trading hours” on such Trading Day or (ii) in all other cases, the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise;
(B) = the Exercise Price of this Warrant, as adjusted hereunder; and
(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that for the purpose of Rule 144 under the Securities (as in effect on the Effective Date), the holding period of the Warrant Shares being issued may be tacked on to the Warrants being exercised. The Company agrees not to take any position contrary to this Section 3(g).
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(h) Limitations on Cashless Exercise. In addition to any other limitations pursuant to this Warrant on the exercise of the rights represented by this Warrant, the following shall apply with respect to every cashless exercise pursuant to Section 3(g): If the Company, at the time of its receipt of an Exercise Notice electing a cashless exercise, (i) does not, or has reason to believe that it does not, have a sufficient amount of freely distributable equity to fund the nominal value of the number of Warrant Shares that it would be required to deliver upon such cashless exercise and (ii) (1) holds Common Shares representing more than 2.00% of its share capital registered in the commercial register at that time (the “Minimum Stock”) in treasury, then the Company shall not be obliged (but still has the right, at its sole discretion) to deliver more than such number of Warrant Shares to the Warrantholder as exceeds the Minimum Stock and (2) holds up to the Minimum Stock in treasury, then the Company shall not be obliged to deliver any Warrant Shares to the Warrantholder. The respective Exercise Notice shall be deemed to be null and void to the extent the Warrantholder receives fewer Warrant Shares pursuant to this Section 3(h) than such Exercise Notice relates to. Nothing in this Section 3(h) shall prevent the Warrantholder from duly exercising the rights represented by this Warrant with payment of the Exercise Price in cash.
Section 4. No Rights as Shareholder. Without limitation of any provision hereof, the Warrantholder agrees that this Warrant does not entitle the Warrantholder to any voting rights or other rights as a shareholder of the Company prior to the delivery of any Common Shares to the Warrantholder upon exercise of any of the purchase rights set forth in this Warrant.
Section 5. Warrantholder Registry. The Company shall maintain a registry showing the name and address of the registered holder of this Warrant. The Warrantholder’s initial address, for purposes of such registry, is set forth in Section 11(c) below. The Warrantholder may change such address by giving written notice of such changed address to the Company.
Section 6. Adjustments and Other Events. The Exercise Price and the number of Common Shares purchasable hereunder are subject to adjustment from time to time, as follows; provided that no single event shall cause an adjustment or distribution under more than one subsection of this Section 6 so as to result in duplication.
(a) Merger Event. If, during the Term, a Merger Event that is a Liquid Sale occurs with respect to the Company, the Warrantholder shall be deemed to have exercised the then-remaining purchase rights represented by this Warrant in full (without regard for Section 3(f)) immediately prior to the closing of such Liquid Sale, with the applicable Exercise Price to be withheld by the Company from the proceeds to which the Warrantholder would otherwise be entitled in connection with such Liquid Sale. If, during the Term, a Merger Event that is not a Liquid Sale occurs with respect to the Company, the Company shall cause the successor or surviving entity to assume this Warrant and the obligations of the Company hereunder on the closing of such Merger Event (with such appropriate adjustment to accommodate any changes in the jurisdiction of incorporation), and thereafter this Warrant shall represent the right to purchase the same number and type of securities or other property as the Warrantholder would have received in consideration for the Common Shares issuable hereunder had it exercised this Warrant in full (without regard for Section 3(f)) as of immediately prior to such closing, at an aggregate Exercise Price no greater than the aggregate Exercise Price in effect as of immediately prior to such closing, and subject to further adjustment from time to time in accordance with the provisions of this Warrant. The provisions of this Section 6(a) shall similarly apply to successive Merger Events.
(b) Reclassification of Shares. Except for Merger Events subject to Section 6(a), if the Company at any time shall, by combination, reclassification, exchange or subdivision of securities or otherwise, change any of the securities as to which purchase rights under this Warrant exist into the same or a different number of securities of any other class or classes of securities, this Warrant shall thereafter represent the right to acquire such number and kind of securities as would have been issuable as the result of such change with respect to the securities which were subject to the purchase rights under this Warrant immediately prior to such combination, reclassification, exchange, subdivision or other change. The provisions of this Section 6(b) shall similarly apply to successive combination, reclassification, exchange, subdivision or other change.
(c) Subdivision or Combination of Shares. If the Company at any time shall combine or subdivide its Common Shares, (i) in the case of a subdivision, the Exercise Price shall be proportionately decreased and the number of shares for which this Warrant is exercisable shall be proportionately increased, or (ii) in the case of a
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combination, the Exercise Price shall be proportionately increased and the number of shares for which this Warrant is exercisable shall be proportionately decreased.
(d) Dividends. If the Company at any time while this Warrant is outstanding and unexpired shall:
(i) pay a dividend with respect to the Common Shares payable in additional Common Shares, then the Exercise Price shall be adjusted, from and after the date of determination of shareholders entitled to receive such dividend, to that price determined by multiplying the Exercise Price in effect immediately prior to such date of determination by a fraction (A) the numerator of which shall be the total number of Common Shares outstanding immediately prior to such dividend or distribution, and (B) the denominator of which shall be the total number of Common Shares outstanding immediately after such dividend or distribution, and the number of Common Shares for which this Warrant is exercisable shall be proportionately increased; or
(ii) make any other dividend or distribution on or with respect to Common Shares, except any dividend or distribution specifically provided for in any other clause of this Section 6, then, in each such case, provision shall be made by the Company such that the Warrantholder shall receive a proportionate share of any such dividend or distribution as though it were the holder of the Common Shares (or other capital stock for which the Common Shares is convertible) as of the record date fixed for the determination of the shareholders of the Company entitled to receive such dividend or distribution without regard for Section 3(f) (a “Dividend Compensation Payment”).
(e) Limitations on Adjustments. Notwithstanding anything to the contrary in this Section 6, (i) all calculations under this Section 6 shall be made to the nearest one-hundredth (1/100th) of a cent or to the nearest one-tenth (l/10th) of a share, as the case may be, (ii) no adjustment in the Exercise Price shall be made if the amount of such adjustment would be less than $0.01, (iii) no adjustment in the number of Common Shares into which this Warrant is exercisable shall be made if the amount of such adjustment would be less than one (1) Common Share, and (iv) if an adjustment in Exercise Price would reduce the Exercise Price to an amount below the then-applicable par value of the Common Shares, then such adjustment in the Exercise Price shall reduce the Exercise Price to such par value of the Common Shares.
Section 7. Transfers. Subject to compliance with applicable federal and state securities laws, this Warrant and all rights hereunder are transferable, in whole or in part, without charge to the holder hereof (except for transfer taxes) by executing an assignment declaration in wet ink in the form attached as Exhibit B hereto (the “Transfer Notice”) and the payment to the Company of all transfer taxes and other governmental charges imposed on such transfer. Until the Company receives a copy of such duly signed Transfer Notice and, if applicable, such transfer taxes and other governmental charges, the Company may treat the registered owner hereof as the owner for all purposes. Upon receipt of a copy of such duly signed Transfer Notice and, if applicable, such transfer taxes and other governmental charges, the Company shall update its registry of warrantholders.
Section 8. Tax Matters.
(a) Withholding. The Company and its paying agent shall be entitled to deduct and withhold taxes on any Dividend Compensation Payment, or any other amount distributed or deemed distributed, to the extent required by applicable law. To the extent that any such amounts are so deducted or withheld and remitted to the applicable governmental authority, such deducted or withheld amounts shall be treated for all purposes of this Warrant as having been paid to the Person in respect of which such deduction or withholding was made. In the event the Company previously remitted any such amounts to a governmental authority on account of taxes required to be deducted or withheld in respect of any Dividend Compensation Payment, the Company shall be entitled (i) to offset any such amounts against any amounts otherwise payable in respect of such Warrant, any Common Shares otherwise required to be issued upon the exercise of such Warrant or any amounts otherwise payable in respect of Common Shares received upon the exercise of such Warrant, or (ii) to require the Person in respect of whom such deduction or withholding was made to reimburse the Company for such amounts (and such Person shall promptly so reimburse the Company upon demand). The Company shall provide a receipt or other evidence of payment of any taxes deducted or withheld reasonably acceptable to the Warrantholder within 30 days after making any deduction or withholding of such taxes and shall collaborate with and provide to the Warrantholder all documentation necessary to obtain a refund of such tax amounts deducted and withheld.
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(b) Transfer and Stamp Taxes. Each party shall bear and pay any transfer, stamp, issue, registration, documentary, sales, use, or similar taxes or obligations imposed on such party with respect to any amounts payable in connection with this Warrant.
Section 9. Certain Representations and Agreements
The Company represents, covenants and agrees:
(a) This Warrant is, and any Warrant issued in substitution for or replacement of this Warrant shall be, upon issuance, duly authorized and validly issued.
(b) All Warrant Shares issuable upon the exercise of this Warrant pursuant to the terms hereof will be, upon issuance, validly issued, fully paid and non-assessable. The Company has allocated and reserved, and for so long as this Warrant is outstanding the Company will continue to reserve, the Company’s capital range under article 4a or the Company’s conditional share capital under article 4c of the Articles of Association in such an amount as is necessary to deliver such number of Common Shares as are required to settle the exercise in full of this Warrant.
(c) The Company shall take all such actions as may be necessary to ensure that all Warrant Shares are issued without violation by the Company of any applicable law or governmental regulation or any requirements of any securities exchange upon which the Warrant Shares will be listed upon their issuance.
(d) The board of directors of the Company will, as long as any Warrants are outstanding, not make any proposal to the general meeting of shareholders of the Company regarding the amendment or modification of any provision of the Articles of Association in any manner that would materially and adversely affect the powers, preferences or relative participating, optional or other special rights of the Common Shares in a manner which would disproportionately and adversely affect the rights of the Warrantholder.
Section 10. Exchange of Additional Common Shares. If the legal and factual conditions for an exchange are met and all necessary consents and approvals have been obtained by the Company, the Company will, upon written request of the Warrantholder, consider providing arrangements for [warrant holder name] and its Affiliates to exchange or convert within a reasonable timeframe after such conditions are met their Common Shares exceeding 9.99% of outstanding Common Shares for the same amount of non-voting securities (including, without limitation, warrants) that include a 9.99% beneficial ownership blocker.
Section 11. Miscellaneous.
(a) Severability. In the event any one or more of the provisions of this Warrant shall for any reason be held invalid, illegal or unenforceable, the remaining provisions of this Warrant shall be unimpaired, and the invalid, illegal or unenforceable provision shall be replaced by a mutually acceptable valid, legal and enforceable provision, which comes closest to the intention of the parties underlying the invalid, illegal or unenforceable provision.
(b) Successors and Assigns. This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the Company and the Warrantholder and their respective successors and permitted assigns (subject to Section 6 with respect to the Warrantholder); provided that the Company shall not assign its obligations under this Warrant except in connection with a Merger Event as provided in Section 6(a).
(c) Notices. Except as otherwise provided herein, any notice, demand, request, consent, approval, declaration, service of process or other communication that is required, contemplated, or permitted under this Warrant or with respect to the subject matter hereof shall be in writing, and shall be deemed to have been validly served, given, delivered, and received: (i) for personal delivery, upon personal delivery to the party to be notified, or (ii) for email, upon the earlier of (x) confirmation of receipt (other than automatically generated confirmations of receipt), (y) if sent during normal business hours of the recipient, upon delivery and (z) if sent after normal business hours of the recipient, then on the next Business Day, and shall be addressed to the party to be notified as follows: (i) if to the Warrantholder: c/o Redmile Group, LLC, One Letterman Drive, Suite D3-300, San Francisco, CA 94129 Attention: Redmile Legal, Email: redmile_legal@redmilegrp.com, and (ii) if to the Company: ADC Therapeutics SA, Biopôle, Route de la Corniche 3B, 1066 Epalinges, Switzerland, Attention: Legal Department, Email: legal@adctherapeutics.com, or to such other address as each party may designate for itself by like notice.
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(d) Entire Agreement; Amendments. This Warrant constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter hereof, and supersedes and replaces in their entirety any prior proposals, term sheets, letters, negotiations or other documents or agreements, whether written or oral, with respect to the subject matter hereof. None of the terms of this Warrant may be amended except by an instrument executed by each of the parties hereto.
(e) No Waiver. No omission or delay by the Warrantholder at any time to enforce any right or remedy reserved to it, or to require performance of any of the terms, covenants or provisions hereof by the Company at any time designated, shall be a waiver of any such right or remedy to which the Warrantholder is entitled, nor shall it in any way affect the right of the Warrantholder to enforce such provisions thereafter during the term of this Warrant.
(f) Governing Law, Consent to Jurisdiction and Venue. This Warrant and any claim, controversy or dispute arising out of or related to this Warrant, any of the transactions contemplated hereby, the relationship of the Parties hereunder, or the interpretation and enforcement of the rights and duties of the Parties, whether arising in contract, tort or otherwise, shall be governed by and construed in accordance with the substantive laws of Switzerland, without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the laws of any jurisdiction other than Switzerland. The exclusive place of jurisdiction for any dispute, claim or controversy arising under, out of or in connection with or related to this Warrant (or subsequent amendments thereof), including, without limitation, disputes, claims or controversies regarding its existence, validity, interpretation, performance, breach or termination, shall be the city of Lausanne, Switzerland.
(g) Counterparts. This Warrant and any amendments, waivers, consents or supplements hereto may be executed in any number of counterparts (including by facsimile or electronic delivery (PDF), and by different parties hereto in separate counterparts, each of which when so delivered shall be deemed an original, but all of which counterparts shall constitute but one and the same instrument.
(h) Legends. To the extent required by applicable laws, the Common Shares issuable upon the exercise of this Warrant (and the securities issuable, directly or indirectly, upon conversion of such Common Shares, if any) may be imprinted with a restricted securities legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO A REGISTRATION STATEMENT RELATED THERETO THAT IS IN EFFECT UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH LAWS.
For the avoidance of doubt, no such legend shall be imprinted on the Common Shares issued upon exercise (in whole or in part) of this Warrant if the Registration Statement is effective (and a prospectus thereunder for the issuance of the Warrant Shares is current) or there is otherwise an effective registration statement (and a prospectus thereunder for the issuance of the Warrant Shares is current) registering the issuance of the Warrant Shares at the time the Warrant Shares are delivered to the Warrantholder; provided that the Company shall have no obligation to file such registration statement or maintain a current prospectus for the issuance of the Warrant Shares.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the Company has duly executed this Warrant.
Dated: May 8, 2024.
| ADC THERAPEUTICS SA | ||
| By: | ||
| Name: Ameet Mallik | ||
| Title: Chief Executive Officer | ||
Dated: May 8, 2024.
Agreed and Acknowledged:
| [●] | ||
| By: | ||
| Name: | ||
| Title: | ||
EXHIBIT A
FORM OF EXERCISE NOTICE
(To be executed by the registered holder hereof)
Reference is made to (i) the attached Warrant to Purchase Common Shares of ADC Therapeutics SA No. W-PF-[_] (the “Warrant”) and (ii) if applicable, article 4(c) of the articles of association of the Company.
The undersigned registered owner of the Warrant hereby irrevocably exercises the right to purchase represented by the Warrant for, and hereby purchases thereunder, ____________Common Shares (such number of Common Shares, the “Exercise Number”), of ADC THERAPEUTICS SA (the “Company”), as provided for therein in accordance with Section 3 and the other terms and conditions of the Warrant, as well as the articles of association of the Company. All capitalized terms used but not defined in this exercise notice shall have the meanings ascribed thereto in the Warrant. Following this exercise, the Warrant Shares shall be reduced by the Exercise Number.
Payment shall take the form of (check applicable box):
[__] in cash to the following ADC Therapeutics SA bank account:
Or
[__] the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 3(g), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 3(g).
Please issue the Common Shares in the name of the undersigned and to the following address:
Issue to: ____________________________
Address: ____________________________
Email Address: ____________________________
DTC Details (if applicable): ____________________________
| Dated: |
Name of Holder
|
| Signature ____________________________ | |
| Address _____________________________ |
EXHIBIT B
TRANSFER NOTICE
(To transfer or assign the enclosed Warrant execute this form and supply required information. Do not use this form to purchase shares.)
The enclosed Warrant and all rights evidenced thereby are hereby transferred and assigned to:
| Name of Transferee: | ||
| Address of Transferee: | ||
| Name of Transferor: | ||
| Signature of Transferor: | ||
| Dated: | ||
| Accepted: | ||
| Name of Transferee: | ||
| Signature of Transferee: | ||
| Dated: | ||
NOTE: The name of the transferor must correspond with the name as it appears on the face of the Warrant. The signature(s) of the individual(s) signing this Transfer Notice on behalf of the transferor must be made in wet ink. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the enclosed Warrant.
Exhibit 5.1
|
ADC Therapeutics SA Biopôle Route de la Corniche 3 B 1066 Epalinges Switzerland |
Homburger AG Prime Tower Hardstrasse 201 CH-8005 Zürich
homburger.ch
|
May 8, 2024
|
|
| ADC Therapeutics SA – Offering of Securities Pursuant to the Prospectus Supplement dated May 6, 2024 and the Accompanying Prospectus Dated March 14, 2024 | |
Ladies and Gentlemen
We have acted as special Swiss counsel to ADC Therapeutics SA, a stock corporation incorporated under the laws of Switzerland (the Company), in connection with the filing of the prospectus supplement dated May 6, 2024 to the prospectus dated March 14, 2024, included in the Company’s registration statement on Form S-3 (the Registration Statement) filed with the United States Securities and Exchange Commission (the SEC) for the purpose of registering under the United States Securities Act of 1933, as amended (the Securities Act), the offer and sale of (i) 13,411,912 common shares of the Company, each with a nominal value of CHF 0.08 (the Common Shares), (ii) pre-funded warrants to purchase 8,163,265 common shares of the Company (the Pre-Funded Warrants) and (iii) the 8,163,265 common shares of the Company issuable upon exercise of the Pre-Funded Warrants (the Warrant Shares). As such counsel, we have been requested to give our opinion as to certain legal matters of Swiss law.
Capitalized terms used but not defined herein have the meanings assigned to such terms in the Documents (as defined below).
| I. | Basis of Opinion |
This opinion is confined to and given on the basis of the laws of Switzerland in force at the date hereof. Such laws and the interpretation thereof are subject to change. This opinion is also confined
to the matters stated herein and the Documents (as defined below), and is not to be read as extending, by implication or otherwise, to any agreement or other document referred to in any of the Documents or any other matter.
For purposes of this opinion, we have not conducted any due diligence or similar investigation as to factual circumstances that are or may be referred to in the Documents, and we express no opinion as to the accuracy of representations and warranties of facts set out in the Documents or the factual background assumed therein.
For purposes of this opinion, we have only reviewed the following documents (collectively, the Documents):
| (a) | an electronic copy of the Registration Statement; |
| (b) | an electronic copy of the Pre-Funded Warrants; |
| (c) | an electronic copy of the resolutions of the board of directors of the Company dated May 2, 2024 (the Offering Board Resolution), regarding, inter alia, (i) the approval of the offering and sale of the Common Shares and the Pre-Funded Warrants; |
| (d) | an electronic copy of the resolutions of the Pricing Committee dated May 6, 2024, determining the number and offer price of the Common Shares and the Pre-Funded Warrants (the Pricing Committee Resolution, and together with the Offering Board Resolution, the Board Resolutions); |
| (e) | an electronic copy of a certified excerpt from the Commercial Register of the Canton of Vaud dated May 8, 2024, relating to the Company (the Excerpt); and |
| (f) | an electronic copy of the articles of association (statuts) of the Company dated as of May 7, 2024 (the Articles). |
No documents have been reviewed by us in connection with this opinion other than the Documents. Accordingly, we shall limit our opinion to the Documents and their legal implications under Swiss law.
In this opinion, Swiss legal concepts are expressed in English terms and not in their original language. These concepts may not be identical to the concepts described by the same English terms as they exist under the laws of other jurisdictions. With respect to Documents governed by laws other than the laws of Switzerland, for purposes of this opinion we have relied on the plain meaning of the words and expressions contained therein without regard to any import they may have under the relevant governing law.
| II. | Assumptions |
In rendering the opinions below, we have assumed the following:
| (a) | all documents produced to us as originals are authentic and complete, and all documents produced to us as copies (including, without limitation, electronic copies) conform to the original; |
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| (b) | all documents produced to us as originals and the originals of all documents produced to us as copies were duly executed and certified, as applicable, by the individuals purported to have executed or certified, as the case may be, such documents, and any electronic signatures on any such document have been affixed thereto by the individual to whom such electronic signature belongs and such individual has saved and submitted such document as so electronically signed in such a manner so as to prevent removal or other alteration of such signature; |
| (c) | all signatures appearing on all original documents or copies thereof which we have examined are genuine and authentic; |
| (d) | the Registration Statement has been duly filed by the Company; |
| (e) | the parties to the Pre-Funded Warrants (other than the Company) are duly incorporated or formed, as applicable, and organized and validly existing under the laws of their respective jurisdiction of incorporation or formation, as applicable, and have the requisite capacity, power and authority to execute, deliver, where applicable, and perform their obligations as provided in the Pre-Funded Warrants; |
| (f) | the Pre-Funded Warrants are within the capacity and power of, have been duly authorized, executed and delivered by, and are binding on, all parties thereto other than the Company (with respect to Swiss law); |
| (g) | to the extent relevant for purposes of this opinion, all parties to the Pre-Funded Warrants have performed and will perform all obligations by which they are respectively bound under the Pre-Funded Warrants, and all parties to the Pre-Funded Warrants are in compliance with all matters of validity and enforceability under any law other than, in the case of the Company and with respect to the Company, the laws of Switzerland; |
| (h) | as far as any obligation under the Pre-Funded Warrants are required to be performed in, or by a party organized under the laws of, any jurisdiction outside of Switzerland, its performance will not be illegal or unenforceable by virtue of the laws of such jurisdiction; |
| (i) | the parties to the Pre-Funded Warrants entered into the Pre-Funded Warrants for bona fide commercial reasons and on arm's length terms, and none of the directors, officers or agents of any such party has or had a conflict of interest with such party in respect of the Documents that would preclude such director, officer or agent from validly representing (or granting a power of attorney in respect of the Documents for) such party; |
| (j) | the Excerpt and the Articles are correct, complete and up-to-date as of the date hereof and no changes have been made that should have been or should be reflected in the Excerpt or the Articles as of the date hereof; |
| (k) | the Board Resolutions (i) have been duly adopted in meetings duly convened and otherwise in the manner set forth therein, (ii) have not been amended, and (iii) are in full force and effect; |
| (l) | each party to the Documents (other than the Company) is a corporation or other legal entity duly organized and validly existing and in good standing (if applicable) under the laws of the jurisdiction of its incorporation and/or establishment and none of the parties to the Documents |
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(other than the Company) has passed or, until the issuance (if applicable) of all Common Shares not yet issued, will have passed a voluntary winding-up resolution; no petition has been, or, until the issuance of all Common Shares not yet issued, will be presented or order made by a court for the winding-up, dissolution, bankruptcy or administration of any party (other than the Company); and no receiver, trustee in bankruptcy, administrator or similar officer has been or, until the issuance of all Common Shares not yet issued, will have been appointed in relation to any of the parties (other than the Company) or any of their assets or revenues;
| (m) | except as expressly opined upon herein, and to the extent relevant for purposes of this opinion, all information and confirmations contained in the Documents, and all material statements made to us in connection with the Documents, are true and accurate; |
| (n) | there are no provisions of the laws of any jurisdiction other than Switzerland that may affect the opinions expressed herein; |
| (o) | the Registration Statement is unchanged and correct, complete and up-to-date and in full force and effect as of the date hereof and no changes have been made which should have been or should be reflected in the Registration Statement as of the date hereof; |
| (p) | the Company has not entered and will not enter into any transaction which could be construed as repayment of share capital (restitution des versements); and |
| (q) | all authorizations, approvals, consents, licenses, exemptions, other than as required by mandatory Swiss law applicable to the Company or the Articles, and other requirements for the filing of the Registration Statement or for any other activities carried on in view of, or in connection with, the performance of the obligations expressed to be undertaken by the Company in the Registration Statement have been duly obtained or fulfilled in due time and are and will remain in full force and effect, and any related conditions to which the parties thereto are subject have been satisfied. |
| III. | Opinion |
Based on the foregoing and subject to the qualifications set out below, we are of the opinion that:
| 1. | The Common Shares are validly issued in the form of uncertificated securities (droits-valeurs), fully paid-in as to their nominal value and non-assessable. |
| 2. | The Pre-Funded Warrants constitute valid and binding obligations of the Company, enforceable against it in accordance with the terms of the Pre-Funded Warrants. |
| 3. | The Warrant Shares to be issued upon exercise of the Pre-Funded Warrants, if and when issued and paid for pursuant to the Articles, the Pre-Funded Warrants and Swiss law—in particular after the exercise notice has been given (if applicable) and the issue price for such Warrant Shares has been paid-in in accordance with the Articles, the Pre-Funded Warrants and Swiss law and upon registration of the corresponding share capital increase into the Commercial Register of the Canton of Vaud (if applicable)—and if and when such Warrant Shares have been entered into the Company's book of uncertificated securities, will be validly issued in the form of uncertificated securities (droits-valeurs), fully paid-in as to their nominal value and non-assessable. |
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| IV. | Qualifications |
The above opinions are subject to the following qualifications:
| (a) | The lawyers of our firm are members of the Zurich bar and do not hold themselves out to be experts in any laws other than the laws of Switzerland. Accordingly, we are opining herein as to Swiss law only, based on our independent professional judgment, and we express no opinion with respect to the applicability or the effect of the laws of any other jurisdiction to or on the matters covered herein. |
| (b) | As used in this opinion, the terms "enforceable" and "enforceability" mean that the relevant obligation or provision is of a type enforced by the Swiss courts in accordance with, and subject to, the rules of procedure applicable in Switzerland. It is not certain, however, that the Pre-Funded Warrants will be enforced in accordance with its terms in every circumstance. In particular, enforceability of the Pre-Funded Warrants may be limited by applicable bankruptcy, insolvency, reorganization or similar laws affecting the rights of creditors in general (including, without limitation, the provisions relating to voidable preferences as set forth in articles 285 et seq. of the Swiss Federal Debt Enforcement and Bankruptcy Act of April 11, 1889, as amended), laws or principles of general application (including, but not limited to, the abuse of rights (abus de droit) and the principle of good faith (principe de la bonne foi), and public policy, as defined in articles 17-19 of the Swiss Private International Law Act of December 18, 1987, as amended (the Private International Law Act). |
Enforcement before the courts of Switzerland will in any event be subject to:
| (i) | the nature of the remedies available in the Swiss courts (and nothing in this opinion should be taken as indicating that specific performance (other than for the payment of a sum of money) or injunctive relief would be available as remedies for the enforcement of such obligations); and |
| (ii) | the acceptance of such courts of jurisdiction and the power of such courts to stay proceedings if concurrent proceedings are being brought elsewhere. |
| (c) | Under Swiss law, jurisdiction clauses may have no effect with regard to actions relating to, or deemed to be brought in connection with, insolvency procedures, which, as a rule, must be brought before the court at the place of the relevant insolvency procedure. |
| (d) | Rights and claims may become barred under statutes of limitation or prescription, or may be or become subject to available defenses such as set-off, counterclaim, misrepresentation, material error, frustration, overreaching, duress or fraud. |
| (e) | Swiss courts do not consider themselves bound by contractual severability provisions or provisions stating that an agreement may only be amended in writing. |
| (f) | Under Swiss law, a notice sent but not actually received may be considered not to have been properly given, and a document required to be signed or to be made in writing may not constitute a valid document if only transmitted by fax, e-mail or similar telecommunication. |
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| (g) | Swiss courts interpret and construe an agreement in accordance with the principle of good faith (interprétation des contrats d'après les règles de la bonne foi) and, in doing so, may consider elements in addition to the wording of the relevant provisions of such agreement, including, without limitation, the circumstances under which such agreement was entered into and the real intention of the parties thereto as mutually understood or as to be understood in good faith. |
| (h) | In making references to the terms of the Pre-Funded Warrants, no opinion is expressed as to whether and to what extent these are sufficiently specified or leave room for interpretation which may, as the case may be, become a matter of the discretion of the courts. |
| (i) | Where a party to the Pre-Funded Warrants are vested with discretion, Swiss law may require that such discretion is exercised on reasonable grounds. Moreover, a determination, calculation, statement or certification as to any matter may be held by a Swiss court not to be final, conclusive or binding if such determination, calculation, statement or certification were shown to have an unreasonable, incorrect or arbitrary basis or not to have been given or made in good faith. |
| (j) | While Swiss courts have generally the power to grant judgments ordering specific performance of an agreement, such remedy may not always be available for the enforcement of an obligation other than for the payment of a sum of money. |
| (k) | The enforceability in Switzerland of a foreign judgment rendered against the Company is subject to the limitations set forth in (x) bilateral and international treaties by which Switzerland is bound (including, but not limited to, the Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters of October 30, 2007 (the Lugano Convention)), and (y) the Private International Law Act. In particular, and without limitation to the foregoing, a judgment rendered by a foreign court may only be enforced in Switzerland if: |
| (i) | in the case of sub-clause (y) above and, in certain exceptional cases, sub-clause (x) above, such foreign court had jurisdiction; |
| (ii) | such judgment has become final and non-appealable, or, in the case of sub-clause (x) above, has become enforceable at an earlier stage; |
| (iii) | the court procedures leading to such judgment followed the principles of due process of law, including proper service of process, subject to special provisions provided for by bilateral and international treaties by which Switzerland is bound (including, but not limited to, the Lugano Convention); |
| (iv) | such judgment on its merits does not violate Swiss law principles of public policy; and |
| (v) | from a Swiss law perspective, such foreign procedure does not formally or functionally qualify as an insolvency-related, administrative or criminal procedure. |
| (l) | A judgment given by a Swiss court in respect of proceedings instituted before it based on a claim for currencies other than Swiss francs may be expressed in such currency, if so requested. |
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Enforcement of a claim or court judgment under Swiss debt collection or bankruptcy proceedings may only be made in Swiss francs and any foreign currency amount must accordingly be converted into Swiss francs in accordance with the applicable rules.
| (m) | When used in this opinion, the term "non-assessable" means that no further contributions have to be made by the relevant holder of the shares. |
| (n) | The exercise of voting rights and rights related thereto with respect to any Common Shares is only permissible after registration in the Company's share register as a shareholder with voting rights in accordance with the provisions of, and subject to the limitations provided in, the Articles. |
| (o) | We express no opinion as to whether the Registration Statement is accurate, true, correct, complete or not misleading. In particular, and without limitation to the foregoing, we express no opinion on whether the Registration Statement provides sufficient information for investors to reach an informed assessment of the Company, any companies within the Company's consolidation perimeter and the Common Shares. |
| (p) | We express no opinion as to tax, banking, insurance or regulatory matters or as to any commercial, accounting, calculating, auditing or other non-legal matter. |
* * *
We have issued this opinion as of the date hereof and we assume no obligation to advise you of any changes in fact or in law that are made or brought to our attention hereafter.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and further consent to the reference to our name under the caption "Legal Matters" in the Prospectus. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act.
This opinion is governed by and shall be construed in accordance with the laws of Switzerland.
[signature page follows]
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Sincerely yours,
/s/ Homburger AG
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