Passive Market Making.
In connection with this offering, underwriters and selling group members may engage in passive market making transactions in our common stock on the Nasdaq Stock Market in accordance with Rule 103 of Regulation M under the Securities Exchange Act of 1934, as amended, during a period before the commencement of offers or sales of common stock and extending through the completion of the distribution. A passive market maker must display its bid at a price not in excess of the highest independent bid of that security. However, if all independent bids are lowered below the passive market maker’s bid, such bid must then be lowered when specified purchase limits are exceeded.
Lock-Up Agreements
We have agreed that we will not, directly or indirectly, (i) offer, sell, assign, transfer, pledge, contract to sell, or otherwise dispose of, or announce the intention to otherwise dispose of, any shares of our common stock (including, without limitation, common stock which may be deemed to be beneficially owned by us in accordance with the rules and regulations promulgated under the Securities Exchange Act of 1934, as amended, or the Exchange Act) or securities convertible into or exercisable or exchangeable for our common stock, or (ii) enter into any swap, hedge, or similar agreement or other arrangement that transfers in whole or in part, the economic risk of ownership of any shares of common stock or any such other securities, or (iii) engage in any short selling of our common stock or securities convertible into or exercisable or exchangeable for our common stock, in each case without the prior written consent of the Representatives for a period of 90 days, or 30 days, in the case of our existing at-the-market offering program, after the date of this prospectus supplement.
We have agreed that, subject to certain conditions, the foregoing restrictions shall not apply to:
(i) the shares of our common stock to be sold in this offering;
(ii) any shares of our common stock and options to purchase our common stock, shares of common stock underlying options granted and other securities, each issued pursuant to any director or employee stock option plan, stock ownership plan or dividend reinvestment plan of the Company;
(i) any shares of our common stock issued pursuant to the conversion of securities or the exercise of warrants;
(ii) adoption of a new equity incentive plan, and filing a registration statement on Form S-8 under the Securities Act to register the offer and sale of securities to be issued pursuant to such new equity incentive plan, subject to certain limitations;
(iii) any options and awards granted under an equity incentive plan described in this prospectus supplement, provided that the recipient executes a lock-up agreement for the remainder of the 90-day period referred to above; or
(iv) issuances of our common stock or securities convertible or exchangeable for shares of common stock in connection with any acquisition, collaboration, licensing or other strategic transaction (but excluding transactions principally of a financing nature); subject to certain limitations.
Our directors and executive officers have entered into lock-up agreements with the underwriters prior to the commencement of this offering pursuant to which each of these persons or entities, with limited exceptions, for a period of 90 days after the date of this prospectus supplement, may not, without the prior written consent of the Representatives, directly or indirectly, (i) offer, sell, assign, transfer, pledge, contract to sell, or otherwise dispose of, or announce the intention to otherwise dispose of, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock (including, without limitation, common stock which may be deemed to be beneficially owned by each such director, executive officer and stockholder in accordance with the rules and regulations promulgated under the Exchange Act) or securities convertible into or exercisable or exchangeable for our common stock or (ii) enter into any swap, hedge or similar agreement or arrangement that transfers in whole or in part, the economic risk of ownership of the common stock or securities
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