Exhibit 1.1
1,000,000 SHARES
TRANSKARYOTIC THERAPIES, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
December 19, 2001
XX XXXXX SECURITIES CORPORATION
DEUTSCHE BANC ALEX. XXXXX INC.
PACIFIC GROWTH EQUITIES, INC.
LEERINK XXXXX & CO.
As Representatives of the several Underwriters
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. INTRODUCTORY. Transkaryotic Therapies, Inc., a Delaware corporation (the
"Company"), proposes to sell, pursuant to the terms of this Agreement, to the
several underwriters named in Schedule A hereto (the "Underwriters," or, each,
an "Underwriter"), an aggregate of 1,000,000 shares of Common Stock, $.01 par
value per share (the "Common Stock"), of the Company. The aggregate of 1,000,000
shares so proposed to be sold is hereinafter referred to as the "Firm Stock" or
the "Stock". XX Xxxxx Securities Corporation ("XX Xxxxx"), Deutsche Banc Alex.
Xxxxx Inc., Pacific Growth Equities, Inc. and Leerink Xxxxx & Co. are acting as
representatives of the several Underwriters and in such capacity are hereinafter
referred to as the "Representatives."
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and
warrants to, and agrees with, the several Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-51772) (the
"Initial Registration Statement") in respect of the Stock has been
filed with the Securities and Exchange Commission (the "Commission");
the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, and, excluding
exhibits thereto but including all documents incorporated by reference
in the prospectus contained therein, to you for each of the other
Underwriters, have been declared effective by the Commission in such
form; other than a registration statement, if any, increasing the size
of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended
(the "Securities Act"), and the rules and regulations (the "Rules and
Regulations") of the Commission thereunder, which became effective upon
filing, no other document with respect to the Initial Registration
Statement or document incorporated by reference therein has heretofore
been filed with the Commission of which the Company has not advised
you; and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the
Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule
424(a) of the Rules and Regulations, is hereinafter called a
"Preliminary Prospectus"); the various parts of the Initial
Registration Statement and the Rule 462(b) Registration Statement, if
any, including all
Underwriting Agreement - Page 2
exhibits thereto and including (i) the information contained in the
form of final prospectus with respect to the offering of the Stock to
be filed with the Commission pursuant to Rule 424(b) under the
Securities Act and (ii) the documents incorporated by reference in the
prospectus contained in the Initial Registration Statement at the time
such part of the Initial Registration Statement became effective, each
as amended at the time such part of the Initial Registration Statement
became effective or such part of the Rule 462(b) Registration
Statement, if any, became or hereafter becomes effective, are
hereinafter collectively called the "Registration Statements"; and such
final prospectus is hereinafter called the "Prospectus"; and any
reference herein to any Preliminary Prospectus or the Prospectus shall
be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Securities
Act, as of the date of such Preliminary Prospectus or Prospectus, as
the case may be, any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated
by reference in such Preliminary Prospectus or Prospectus, as the case
may be; and any reference to any amendment to the Registration
Statements shall be deemed to refer to and include any annual report of
the Company filed pursuant to Section 13(a) or 15(d) of the Exchange
Act after the effective date of the Initial Registration Statement that
is incorporated by reference in the Registration Statements. No
document has been or will be prepared or distributed in reliance on
Rule 434 under the Securities Act. No order preventing or suspending
the use of any Preliminary Prospectus has been issued by the
Commission.
(b) The Registration Statement conforms (and the Rule 462(b)
Registration Statement, if any, the Prospectus and any amendments or
supplements (other than the prospectus filed with the Commission on
June 26, 2001 and the prospectus filed with the Commission on December
13, 2001 (collectively, the "Prior Prospectuses")) to either of the
Registration Statements or the Prospectus, when they become effective
or are filed with the Commission, as the case may be, will conform) in
all material respects to the requirements of the Securities Act and the
Rules and Regulations and do not and will not, as of the applicable
effective date (as to the Registration Statements and any amendment
thereto) and as of the applicable filing date (as to the Prospectus and
any amendment or supplement thereto other than the Prior Prospectuses)
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading; PROVIDED, however, that the
foregoing representations and warranties shall not apply to information
contained in or omitted from the Registration Statements or the
Prospectus or any such amendment or supplement thereto (other than the
Prior Prospectuses) in reliance upon, and in conformity with, written
information furnished to the Company through the Representatives by or
on behalf of any Underwriter specifically for inclusion therein.
(c) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case
may be, conformed in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents as
of such dates contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus, when such documents become effective or are filed with
Commission , as the case may be, will conform in all material respects
to the requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder
and will not contain any untrue statement of
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a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading; PROVIDED, however, that the foregoing representations and
warranties shall not apply to information contained in or omitted from
any such document so filed after the date hereof in reliance upon, and
in conformity with, written information furnished to the Company
through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein.
(d) The Company and each of its subsidiaries (as defined in Section 14)
have been duly incorporated and are validly existing as corporations in
good standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in good
standing as foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of their
respective businesses requires such qualification (it being understood
that some or all of the foregoing statements may not be applicable to
the Company's Swedish subsidiary as a matter of Swedish law), and have
all power and authority necessary to own or hold their respective
properties and to conduct the businesses in which they are engaged,
except where the failure to so qualify or have such power or authority
would not have, singularly or in the aggregate, a material adverse
effect on the condition (financial or otherwise), results of
operations, business or prospects of the Company and its subsidiaries
taken as a whole (a "Material Adverse Effect"). The Company does not
own or control, directly or indirectly, any corporations, associations
or other entities, except such corporations as are set forth on the
Company's Form 10-K for the year ended December 31, 2000, including the
exhibits thereto or such corporations ("Insignificant Subsidiaries") as
would not be required to be listed as a subsidiary under Item 601 of
Regulation S-K).
(e) This Agreement has been duly authorized executed and delivered by
the Company.
(f) The Stock to be issued and sold by the Company to the Underwriters
hereunder has been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and non-assessable and free of any
preemptive or similar rights and will conform to the description
thereof contained in the Prospectus.
(g) The Company's authorized capital stock consists of 10,000,000
shares of Preferred Stock, of which 10,000 shares have been designated
as Series A Convertible Preferred Stock, and 1,000,000 shares have been
designated as Series B Junior Participating Preferred Stock, and
100,000,000 shares of Common Stock, and all of the issued and
outstanding shares of capital stock of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and
conform to the description thereof contained in the Prospectus.
(h) All the outstanding shares of capital stock of each subsidiary of
the Company have been duly authorized and validly issued, are fully
paid and non-assessable and, except to the extent set forth in the
Prospectus and except with respect to TKT Europe 5S AB or any
Insignificant Subsidiary, are owned by the Company directly or
indirectly through one or more wholly-owned subsidiaries, free and
clear of any claim, lien, encumbrance, security interest, restriction
upon voting or transfer or any other claim of any third party.
(i) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries is bound or
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to which any of the property or assets of the Company or any of its
subsidiaries is subject, except such conflicts, breach, violation or
default which, singularly or in the aggregate, would not have a
Material Adverse Effect, nor will such actions result in any violation
of the provisions of the charter or by-laws of the Company or any of
its subsidiaries or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties or
assets.
(j) Except for the registration of the Stock under the Securities Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable
state securities laws in connection with the purchase and distribution
of the Stock by the Underwriters, no consent, approval, authorization
or order of, or filing or registration with, any court or governmental
agency or body is required for the execution, delivery and performance
of this Agreement by the Company and the consummation of the
transactions contemplated hereby.
(k) Ernst & Young LLP, who have expressed their opinions on the audited
financial statements included or incorporated by reference in the
Registration Statements and the Prospectus, are independent public
accountants as required by the Securities Act and the Rules and
Regulations.
(l) The financial statements, together with the related notes, included
or incorporated by reference in the Prospectus and in each Registration
Statement fairly present the financial position and the results of
operations and changes in financial position of the Company and its
consolidated subsidiaries at the respective dates or for the respective
periods therein specified. Such statements and related notes have been
prepared in accordance with generally accepted accounting principles
applied on a consistent basis except as may be set forth in the
Prospectus.
(m) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the
respective dates as of which information is given in the Prospectus,
there has not been any change in the capital stock (excluding stock
option grants and the exercise of stock options) or long-term debt of
the Company or any of its subsidiaries or any material adverse change,
or any development involving a prospective material adverse change, in
or affecting the business, general affairs, management, financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus.
(n) Except as set forth in the Prospectus, there is no legal or
governmental proceeding pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the
Company or any of its subsidiaries is the subject which, singularly or
in the aggregate, if determined adversely to the Company or any of its
subsidiaries, might have a Material Adverse Effect or would prevent or
adversely affect the ability of the Company to perform its obligations
under this Agreement; and to the best of the Company's knowledge, no
such proceedings that would reasonably be expected to have a Material
Adverse Effect are threatened or contemplated by governmental
authorities or threatened by others.
(o) Neither the Company nor any of its subsidiaries (i) is in violation
of its charter or by-laws, (ii) is in default in any respect, and no
event has occurred which, with notice or lapse of
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time or both, would constitute such a default, in the due performance
or observance of any term, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which it is a party or by which it is bound or to
which any of its property or assets is subject or (iii) is in violation
in any respect of any law, ordinance, governmental rule, regulation or
court decree to which it or its property or assets may be subject,
except, in the case of clauses (ii) and (iii), any violations or
defaults which, singularly or in the aggregate, would not have a
Material Adverse Effect.
(p) Except as described in the Prospectus, the Company and each of its
subsidiaries possesses such permits, licenses, approvals, consents and
other authorizations (including, licenses, pharmacy licenses,
accreditation and other similar documentation or approvals of any local
health departments) (collectively, "Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies, including, without limitation, the Food and Drug Administration
("FDA"), necessary to conduct its business as described in the
Prospectus; the Company is in compliance with the terms and conditions
of all such Governmental Licenses and all applicable FDA rules and
regulations, guidelines and policies, except where the failure so to
comply would not reasonably be expected to, singly or in the aggregate,
result in a Material Adverse Effect; all of the Governmental Licenses
are valid and in full force and effect, except where the invalidity of
such Governmental Licenses or the failure of such Governmental Licenses
to be in full force and effect would not reasonably be expected to
result in a Material Adverse Effect; and the Company has not received
any notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would
reasonably be expected to result in a Material Adverse Effect.
(q) The Company is not, and after giving effect to the offering of the
Stock and the application of the proceeds thereof as described in the
Prospectus, will not become an "investment company" within the meaning
of the Investment Company Act of 1940, as amended and the rules and
regulations of the Commission thereunder.
(r) Neither the Company nor, to the Company's knowledge, any of its
officers, directors or affiliates, has taken, directly or indirectly,
any action designed or intended to stabilize or manipulate the price of
any security of the Company, or which caused or resulted in, or which
would in the future reasonably be expected to cause or result in,
stabilization or manipulation of the price of any security of the
Company.
(s) To the knowledge of the Company, the Company and its subsidiaries
own or possess the right to use all patents, trademarks, trademark
registrations, service marks, service xxxx registrations, trade names,
copyrights, licenses, inventions, trade secrets and rights described in
the Prospectus as being owned by them for the conduct of their
respective businesses, and the Company is not aware of any claim to the
contrary or any challenge by any other person to the rights of the
Company and its subsidiaries with respect to the foregoing, that would
reasonably be expected to result in a Material Adverse Effect. Except
as described in the Prospectus, the Company does not believe that it or
any of its subsidiaries infringes any valid patents, trademarks,
service marks, trade names, copyrights, trade secrets, licenses or
other intellectual property or franchise right of any other person
known to the Company which would reasonably be expected to have a
Material Adverse Effect (it being understood that the Company is not
representing that no person will make a claim against the Company or
its subsidiaries alleging the infringement by the Company or its
subsidiaries of any patent, trademark, service xxxx, trade name,
copyright, trade secret, license or other intellectual property or
franchise right or as to the
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outcome of any claim that may be made). Except as described in the
Prospectus, to the knowledge of the Company, no claim has been made
against the Company alleging the infringement by the Company of any
patent, trademark, service xxxx, trade name, copyright, trade secret,
license in or other intellectual property right or franchise right of
any person.
(t) The Company and each of its subsidiaries have good and marketable
title in fee simple to, or have valid rights to lease or otherwise use,
all items of real or personal property which are material to the
business of the Company and its subsidiaries taken as a whole, in each
case free and clear of all liens, encumbrances, claims and defects,
except such as are described in the 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.
(u) No labor disturbance by the employees of the Company or any of its
subsidiaries exists or, to the best of the Company's knowledge, is
imminent which would reasonably be expected to have a Material Adverse
Effect. The Company is not aware that any employee or significant group
of employees of the Company or any subsidiary plans to terminate
employment with the Company or any such subsidiary, which termination
would reasonably be expected to have a Material Adverse Effect.
(v) There has been no storage, generation, transportation, handling,
treatment, disposal, discharge, emission, or other release of any kind
of toxic or other wastes or other hazardous substances by, due to, or
caused by the Company or any of its subsidiaries (or, to the Company's
knowledge, any other entity for whose acts or omissions the Company or
any of its subsidiaries is or would be liable) upon any of the property
now or previously owned or leased by the Company or any of its
subsidiaries, or upon any other property, in violation of any statute
or any ordinance, rule, regulation, order, judgment, decree or permit
or which would, under any statute or any ordinance, rule (including
rule of common law), regulation, order, judgment, decree or permit,
give rise to any liability, except for any violation or liability which
would not have, singularly or in the aggregate with all such violations
and liabilities, a Material Adverse Effect; there has been no disposal,
discharge, emission or other release of any kind onto any of the
property now or previously owned or leased by the Company or any of its
subsidiaries or into the environment surrounding such property of any
toxic or other wastes or other hazardous substances with respect to
which the Company or any of its subsidiaries have knowledge, except for
any such disposal, discharge, emission, or other release of any kind
which would not have, singularly or in the aggregate with all such
discharges and other releases, a Material Adverse Effect.
(w) The Company and its subsidiaries each (i) have filed all federal,
state and foreign income and franchise tax returns required to be
filed, (ii) have paid all federal state, local and foreign taxes due
and payable for which it is liable (other than matters, if any, which
the Company is contesting in good faith), and (iii) do not have any tax
deficiency or claims outstanding or assessed or, to the Company's
knowledge, proposed against it which would reasonably be expected to
have a Material Adverse Effect.
(x) The Company and each of its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is customary for
companies engaged in similar businesses in similar industries with
products in a similar stage of development.
(y) There is no franchise, lease, contract, agreement or document
required by the Securities Act or by the Rules and Regulations to be
described in the Prospectus or to be filed as an exhibit
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to the Registration Statements which is not described or filed therein
as required; and all descriptions of any such franchises, leases,
contracts, agreements or documents contained in the Registration
Statements are accurate and complete descriptions of such documents in
all material respects.
(z) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers or 5% stockholders
of the Company on the other hand, which is required to be described in
the Prospectus and which is not so described.
(aa) No person or entity has the right to require registration of
shares of Common Stock or other securities of the Company because of
the filing or effectiveness of the Registration Statement, except for
persons and entities who have expressly waived such right or who have
been given proper notice and have failed to exercise such right within
the time or times required under the terms and conditions of such
right.
(bb) Neither the Company nor any of its subsidiaries own any "margin
securities" as that term is defined in Regulations G and U of the Board
of Governors of the Federal Reserve System (the "Federal Reserve
Board"), and none of the proceeds of the sale of the Stock will be
used, directly or indirectly, for the purpose of purchasing or carrying
any margin security, for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any
margin security or for any other purpose which might cause any of the
Company's securities to be considered a "purpose credit" within the
meanings of Regulation G, T, U or X of the Federal Reserve Board.
(cc) Neither the Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person that would give
rise to a valid claim against the Company or the Underwriters for a
brokerage commission, finder's fee or like payment in connection with
the offering and sale of the Stock.
(dd) No forward-looking statement (within the meaning of Section 27A of
the Securities Act and Section 21E of the Exchange Act) contained in
the Prospectus has been made or reaffirmed without a reasonable basis
or has been disclosed other than in good faith.
(ee) The Company is subject to and in compliance with the reporting
requirements of Section 13 or Section 15(d) of the Exchange Act. The
Common Stock is registered pursuant to Section 12(g) of the Exchange
Act and is listed on the Nasdaq Stock Market's National Market and the
Company has taken no action designed to, or likely to have the effect
of, terminating the registration of the Common Stock under the Exchange
Act or delisting the Common Stock from the Nasdaq National Market, nor
has the Company received any notification that the Commission or the
Nasdaq National Market is contemplating terminating such registration
or listing.
(ff) To the knowledge of the Company, the human clinical trials
conducted by the Company or in which the Company has participated that
are described in, or incorporated by reference into, the Prospectus, or
the results of which are referred to in, or incorporated by reference
into, the Prospectus were and, if still pending, are being, conducted
in accordance with experimental protocols, procedures and controls
pursuant to accepted professional scientific standards; the
descriptions of the results of such studies, tests and trials contained
in, or incorporated by reference into, the Prospectus are accurate in
all material respects. The Company has not received any notices or
correspondence from the FDA or any other governmental agency requiring
the termination or suspension of any clinical trials conducted by, or
on behalf of, the Company or in
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which the Company has participated that are described in, or
incorporated by reference into, the Prospectus or the results of which
are referred to in, or incorporated by reference into, the Prospectus.
(gg) The Company meets the requirements of National Association of
Securities Dealers Conduct Rule 2710(b)(7)(C)(i).
3. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees, to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company that number of shares of Firm Stock (rounded up or down, as
determined by XX Xxxxx in its discretion, in order to avoid fractions) obtained
by multiplying 1,000,000 shares of Firm Stock by a fraction the numerator of
which is the number of shares of Firm Stock set forth opposite the name of such
Underwriter in Schedule A hereto and the denominator of which is the total
number of shares of Firm Stock.
The purchase price per share to be paid by the Underwriters to the
Company for the Stock will be $39.90 per share (the "Purchase Price").
The Company will deliver the Firm Stock to the Representatives for the
respective accounts of the several Underwriters (in the form of definitive
certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given at or prior
to 12:00 Noon, New York time, on the second full business day preceding the
Closing Date (as defined below) against payment of the aggregate Purchase Price
therefor by wire transfer to an account at a bank acceptable to XX Xxxxx,
payable to the order of the Company, all at the offices of Xxxxx, Xxxxxxx &
Xxxxxxxxx, LLP, 000 Xxxx Xxxxxx, Xxxxxx, XX 00000. Time shall be of the essence,
and delivery at the time and place specified pursuant to this Agreement is a
further condition of the obligations of each Underwriter hereunder. The time and
date of the delivery and closing shall be at 10:00 A.M., New York time, on
December 26, 2001, in accordance with Rule 15c6-1 of the Exchange Act. The time
and date of such payment and delivery are herein referred to as the "Closing
Date". The Closing Date and the location of delivery of, and the form of payment
for, the Firm Stock may be varied by agreement between the Company and XX Xxxxx.
The Company shall make the certificates for the Stock available to the
Representatives for examination on behalf of the Underwriters in New York, New
York at least twenty-four hours prior to the Closing Date.
The several Underwriters propose to offer the Stock for sale upon the
terms and conditions set forth in the Prospectus.
(4) FURTHER AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters that:
(a) The Company will prepare the Rule 462(b) Registration Statement, if
necessary, in a form approved by the Representatives and file such Rule
462(b) Registration Statement with the Commission on the date hereof;
prepare the Prospectus in a form approved by the Representatives and
file such Prospectus pursuant to Rule 424(b) under the Securities Act
not later than the second business day following the execution and
delivery of this Agreement; make no further amendment or any supplement
to the Registration Statements or to the Prospectus prior to the
Closing Date to which the Representatives shall reasonably object by
notice to the
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Company after a reasonable period to review; advise the
Representatives, promptly after it receives notice thereof, of the time
when any amendment to either Registration Statement has been filed or
becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Representatives with
copies thereof; file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so long
as the delivery of a prospectus is required in connection with the
offering or sale of the Stock; advise the Representatives, promptly
after it receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, of the suspension of the
qualification of the Stock for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose,
or of any request by the Commission for the amending or supplementing
of the Registration Statements or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of
any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus or suspending any such qualification, use
promptly its best efforts to obtain its withdrawal.
(b) If at any time prior to the expiration of nine months after the
effective date of the Initial Registration Statement when a prospectus
relating to the Stock is required to be delivered any event occurs as a
result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact, or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus
to comply with the Securities Act or the Exchange Act, the Company will
promptly notify the Representatives thereof and upon their request will
prepare an amended or supplemented Prospectus or make an appropriate
filing pursuant to Section 13 or 14 of the Exchange Act which will
correct such statement or omission or effect such compliance. The
Company will furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Representatives may from
time to time reasonably request of such amended or supplemented
Prospectus; and in case any Underwriter is required to deliver a
prospectus relating to the Stock nine months or more after the
effective date of the Initial Registration Statement, the Company upon
the request of the Representatives and at the expense of such
Underwriter will prepare promptly an amended or supplemented Prospectus
as may be necessary to permit compliance with the requirements of
Section 10(a)(3) of the Securities Act.
(c) The Company will furnish promptly to the Representatives and to
counsel for the Underwriters a signed copy of each of the Registration
Statements as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits
filed therewith.
(d) The Company will deliver promptly to the Representatives in New
York City such number of the following documents as the Representatives
shall reasonably request: (i) conformed copies of the Registration
Statements as originally filed with the Commission and each amendment
thereto (in each case excluding exhibits), (ii) each Preliminary
Prospectus, (iii) the Prospectus (not later than 10:00 A.M., New York
time, of the business day following the execution and delivery of this
Agreement) and any amended or supplemented Prospectus (not later than
10:00 A.M., New York time, on the business day following the date of
such amendment or supplement) and (iv) any document incorporated by
reference in the Prospectus (excluding exhibits thereto).
Underwriting Agreement - Page 10
(e) The Company will make generally available to its stockholders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Securities Act), an earnings statement of the
Company and its subsidiaries (which need not be audited) complying with
Section 11(a) of the Securities Act and the Rules and Regulations
(including, at the option of the Company, Rule 158).
(f) The Company will promptly take from time to time such actions as
the Representatives may reasonably request to qualify the Stock for
offering and sale under the securities or Blue Sky laws of such
jurisdictions as the Representatives may designate and to continue such
qualifications in effect for so long as required for the distribution
of the Stock; PROVIDED that the Company and its subsidiaries shall not
be obligated to qualify as foreign corporations in any jurisdiction in
which they are not so qualified or to file a general consent to service
of process in any jurisdiction;
(g) During the period of five years from the date hereof, the Company
will deliver to the Representatives and, upon request, to each of the
other Underwriters, (i) as soon as they are available, copies of all
reports or other communications furnished to stockholders and (ii) as
soon as they are available, copies of any reports and financial
statements furnished or filed by the Company with the Commission
pursuant to the Exchange Act or any national securities exchange or
automatic quotation system on which the Stock is listed or quoted, in
each case other than such documents as are available on the internet.
(h) The Company will not directly or indirectly offer, sell, assign,
transfer, pledge, contract to sell, or otherwise dispose of any shares
of Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock until after March 12, 2002without the
prior written consent of XX Xxxxx other than: (i) the Company's sale of
the Stock hereunder and the issuance of shares pursuant to employee
benefit plans, qualified stock option plans or other employee
compensation plans existing on the date hereof or pursuant to currently
outstanding options or warrants, or rights pursuant to The Rights
Agreement dated December 13, 2000 by and between the Company and
Equiserve Trust Company, N.A. or upon the conversion or exchange of
convertible or exchangeable securities outstanding on the date hereof,
or (ii) the issuance by the Company of shares of Common Stock as
consideration for mergers, acquisitions, other business combinations,
or strategic alliances, occurring after the date of this Agreement,
provided that each recipient of shares pursuant to this clause (ii)
agrees that all such shares remain subject to restrictions
substantially similar to those contained in this subsection.
(i) The Company will supply the Representatives with copies of all
correspondence to and from, and all documents issued to and by, the
Commission in connection with the registration of the Stock under the
Securities Act.
(j) Prior to the Closing Date, the Company will furnish to the
Representatives, as soon as they have been prepared, copies of any
unaudited interim consolidated financial statements of the Company for
any monthly periods subsequent to the periods covered by the financial
statements appearing in the Registration Statement and the Prospectus.
(k) Prior to the Closing Date, the Company will not issue any press
release or other communication directly or indirectly or hold any press
conference with respect to the Company, its condition, financial or
otherwise, or earnings, business affairs or business prospects (except
for routine oral marketing communications in the ordinary course of
business and consistent with
Underwriting Agreement - Page 11
the past practices of the Company and of which the Representatives are
notified), without the prior written consent of the Representative,
unless in the judgment of the Company and its counsel, and after
notification to the Representatives, such press release or
communication is required by law.
(l) In connection with the offering of the Stock, until XX Xxxxx shall
have notified the Company of the completion of the resale of the Stock,
the Company will not, and will use its best efforts to cause its
affiliated purchasers (as defined in Regulation M under the Exchange
Act) not to, either alone or with one or more other persons, bid for or
purchase, for any account in which it or any of its affiliated
purchasers has a beneficial interest, any Stock, or attempt to induce
any person to purchase any Stock, except in compliance with Regulation
M; and not to, and to cause its affiliated purchasers not to, make bids
or purchase for the purpose of creating actual, or apparent, active
trading in or of raising the price of the Stock.
(m) The Company will apply the net proceeds from the sale of the Stock
as set forth in the Prospectus under the heading "Use of Proceeds".
5. PAYMENT OF EXPENSES. The Company agrees with the Underwriters to pay (a) the
costs incident to the authorization, issuance, sale, preparation and delivery of
the Stock and any taxes payable in that connection; (b) the costs incident to
the registration of the Stock under the Securities Act; (c) the costs incident
to the preparation, printing and distribution of the Registration Statement,
Preliminary Prospectus, Prospectus any amendments and exhibits thereto or any
document incorporated by reference therein the costs of printing, reproducing
and distributing the "Agreement Among Underwriters" between the Representatives
and the Underwriters, the Master Selected Dealers' Agreement, the Underwriters'
Questionnaire and this Agreement by mail, telex or other means of
communications; (d) the fees and expenses (including related fees and expenses
of counsel for the Underwriters) incurred in connection with filings made with
the National Association of Securities Dealers; (e) any applicable listing or
other fees; (f) the fees and expenses of qualifying the Stock under the
securities laws of the several jurisdictions as provided in Section 4(f) and of
preparing, printing and distributing Blue Sky Memoranda and Legal Investment
Surveys (including related fees and expenses of counsel to the Underwriters);
(g) all fees and expenses of the registrar and transfer agent of the Stock; and
(h) all other costs and expenses incident to the performance of the obligations
of the Company under this Agreement (including, without limitation, the fees and
expenses of the Company's counsel and the Company's independent accountants);
PROVIDED that, except as otherwise provided in this Section 5 and in Section 9,
the Underwriters shall pay their own costs and expenses, including the fees and
expenses of their counsel, any transfer taxes on the Stock which they may sell
and the expenses of advertising any offering of the Stock made by the
Underwriters.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations of the
several Underwriters hereunder are subject to the accuracy, when made and on the
Closing Date, of the representations and warranties of the Company contained
herein, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of their obligations hereunder, and to each of the following additional
terms and conditions:
(a) No stop order suspending the effectiveness of either the
Registration Statements shall have been issued and no proceedings for
that purpose shall have been initiated or threatened by the Commission,
and any request for additional information on the part of the
Commission (to be included in the Registration Statements or the
Prospectus or otherwise) shall have been complied with to the
reasonable satisfaction of the Representatives. The Rule 462(b)
Registration Statement, if any, and the Prospectus shall have been
timely filed with the Commission in accordance with Section 4(a).
Underwriting Agreement - Page 12
(b) None of the Underwriters shall have discovered and disclosed to the
Company on or prior to the Closing Date that the Registration Statement
or the Prospectus or any amendment or supplement thereto (other than
the Prior Prospectuses) contains an untrue statement of a fact which,
in the written opinion of counsel for the Underwriters, is material or
omits to state any fact which, in the written opinion of such counsel,
is material and is required to be stated therein or is necessary to
make the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of each of this Agreement, the Stock,
the Registration Statement and the Prospectus and all other legal
matters relating to this Agreement and the transactions contemplated
hereby shall be reasonably satisfactory in all material respects to
counsel for the Underwriters, and the Company shall have furnished to
such counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.
(d) Xxxx and Xxxx LLP shall have furnished to the Representatives such
counsel's written opinion, as counsel to the Company, addressed to the
Underwriters and dated the Closing Date, in form and substance
reasonably satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Delaware. The Company is duly qualified to do
business and is in good standing as a foreign corporation in
the Commonwealth of Massachusetts, and has all corporate
power and authority necessary to own or hold its properties
and to conduct the business in which it is engaged.
(ii) The Company's authorized capital stock consists of
10,000,000 shares of Preferred Stock, of which 10,000 shares
have been designated as Series A Convertible Preferred
Stock, and 1,000,000 shares have been designated as Series B
Junior Participating Preferred Stock, and 100,000,000 shares
of Common Stock, and all of the issued and outstanding
shares of capital stock of the Company have been duly and
validly authorized and issued, are fully paid and
non-assessable and conform, in all material respects, to the
description thereof contained in the Prospectus.
(iii) The Stock has been duly and validly issued and, when issued
and delivered to the Underwriters against payment therefor
as provided in this Agreement, will be validly issued, fully
paid and non-assessable.
(iv) There are no preemptive or other rights to subscribe for or
to purchase, nor any restriction upon the voting or transfer
of, any shares of the Stock pursuant to the Company's
charter or by-laws or any Material Contract (as defined
below).
(v) This Agreement has been duly authorized, executed and
delivered by the Company.
(vi) The execution and delivery of this Agreement by the Company
and the consummation by the Company of the transactions
contemplated hereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument (a
"Material Contract") to which the
Underwriting Agreement - Page 13
Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries is bound or to which
any of the properties or assets of the Company or any of its
subsidiaries is subject, which has been filed as an exhibit
to the Registration Statement or as an exhibit to any report
filed under the Exchange Act that has been incorporated by
reference in the Prospectus, nor will such actions result in
any violation of the Charter or by-laws of the Company or of
any of its United States subsidiaries or any Federal or
Massachusetts statute, rule or regulation, or any order
known to such counsel of any court or governmental agency or
body or court having jurisdiction over the Company or any of
its subsidiaries or any of their properties.
(vii) Except for the registration of the Stock under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the
Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Stock
by the Underwriters, no consent, approval, authorization or
order of, or filing or registration with, any court or any
Federal or Massachusetts governmental agency or body is
required for the execution and delivery of this Agreement by
the Company and the consummation of the transactions
contemplated hereby.
(viii) The statements in the Prospectus under the heading
"Description of Common and Preferred Stock" and "Plan of
Distribution" in so far as they constitute summaries of
matters of law or regulation or legal conclusions, have been
reviewed by such counsel and are accurate in all material
respects.
(ix) To such counsel's knowledge, there are no legal or
governmental proceedings pending to which the Company or any
of its subsidiaries are a party or any such proceedings
known to such counsel which are threatened or contemplated
against the Company or any of its subsidiaries that are
required to be described in the Registration Statement or
Prospectus which are not described as required, and, to such
counsel's knowledge, there are no contracts or other
documents that are required to be filed as exhibits to the
Registration Statement which are not filed as required.
(x) The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such
opinion, the Rule 462(b) Registration Statement, if any, was
filed with the Commission on the date specified therein, the
Prospectus was filed with the Commission pursuant to the
subparagraph of Rule 424(b) of the Rules and Regulations
specified in such opinion on the date specified therein and,
to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceeding for that purpose is pending or threatened
by the Commission.
(xi) The Registration Statements, as of the respective effective
dates and the Prospectus, as of its date, and any further
amendments or supplements thereto, as of their respective
dates, made by the Company prior to the Closing Date (other
than the financial statements and other financial data,
including notes and schedules, contained therein, as to
which such counsel need express no opinion) complied as to
form in all material respects with the requirements of the
Securities Act and the Rules and Regulations; and the
documents incorporated by
Underwriting Agreement - Page 14
reference in the Prospectus and any further amendment or
supplement to any such incorporated document made by the
Company prior to the Closing Date (other than the financial
statements and related schedules therein, as to which such
counsel need express no opinion), when they became effective
or were filed with the Commission, as the case may be,
complied as to form in all material respects with the
requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder.
(xii) To such counsel's knowledge, no person or entity has the
right to require registration of shares of Common Stock or
other securities of the Company because of the filing or
effectiveness of the Registration Statements, except for
persons and entities who have expressly waived such right or
who have been given proper notice and have failed to
exercise such right within the time or times required under
the terms and conditions of such right.
(xiii) The Company is not an "investment company" within the
meaning of the Investment Company Act and the rules and
regulations of the Commission thereunder.
Such counsel shall also state, without passing upon or
assuming any responsibility for the accuracy or completeness of the
statements contained in any of the following documents that nothing has
come to their attention that has led them to believe (a) that, as of
the effective date of the Registration Statement, the Registration
Statement (or as of its date, any amendment or supplement thereto
(other than the Prior Prospectuses) made by the Company prior to the
date of such opinion) contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or (b) that, as
of its date, the Prospectus as amended or supplemented (other than the
Prior Prospectuses) or any further amendment or supplement thereto made
by the Company prior to the Closing Date contained any untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading or (c) that, as of the Closing Date, the Registration
Statement as amended contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (d) that,
as of the Closing Date, the Prospectus as amended or supplemented
(other than the Prior Prospectuses) contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
Notwithstanding the foregoing, such counsel need express no belief as
to (a) the financial statements, including the notes and schedules
thereto, or any financial data set forth or referred to in the
Registration Statement or the Prospectus as amended or supplemented
(other than the Prior Prospectuses), (b) any matters arising under the
published rules, regulations and policies of the FDA or any other
federal statute or regulation governing the provision of drug
administration, and (c) any matters arising under state statues and
regulations governing the provision of drug administration. Such
counsel may note that, with respect to the foregoing statement, such
counsel does not serve as the Company's patent or regulatory counsel.
(e) Intellectual property counsel and regulatory counsel shall have
furnished to the Representatives such counsels' written opinions, as
counsels to the Company, addressed to the Underwriters and dated the
Closing Date, in form and substance reasonably satisfactory to the
Representatives, to such effect as the Underwriters have previously
specified to the Company
Underwriting Agreement - Page 15
(f) The Representatives shall have received from Xxxxx, Xxxxxxx &
Xxxxxxxxx, LLP, counsel for the Underwriters, such opinion or opinions,
dated the Closing Date, with respect to such matters as the
Underwriters may reasonably require, and the Company shall have
furnished to such counsel such documents as they request for enabling
them to pass upon such matters.
(g) At the time of the execution of this Agreement, the Representatives
shall have received from Ernst & Young LLP a letter, addressed to the
Underwriters and dated such date, in form and substance satisfactory to
the Representatives (i) confirming that they are independent certified
public accountants with respect to the Company and its subsidiaries
within the meaning of the Securities Act and the Rules and Regulations
and (ii) stating the conclusions and findings of such firm with respect
to the financial statements and certain financial information contained
or incorporated by reference in the Prospectus.
(h) On the Closing Date, the Representatives shall have received a
letter (the "bring-down letter") from Ernst & Young LLP addressed to
the Underwriters and dated the Closing Date confirming, as of the date
of the bring-down letter (or, with respect to matters involving changes
or developments since the respective dates as of which specified
financial information is given in the Prospectus as of a date not more
than three business days prior to the date of the bring-down letter),
the conclusions and findings of such firm with respect to the financial
information and other matters covered by its letter delivered to the
Representatives concurrently with the execution of this Agreement
pursuant to Section 6(g).
(i) The Company shall have furnished to the Representatives a
certificate, dated the Closing Date, of its chief financial officer
stating that he has carefully examined the Registration Statement and
certifying on behalf of the Company that (i) the Registration
Statements as of their respective effective dates and the Prospectus,
as of each date thereof, did not include any untrue statement of a
material fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, (ii) since the effective date of the Initial Registration
Statement no event has occurred which should have been set forth in a
supplement or amendment to the Registration Statements or the
Prospectus but was not so stated, (iii) as of the Closing Date, the
representations and warranties of the Company in this Agreement are
true and correct and the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date, and (iv) subsequent to the
date of the most recent financial statements included or incorporated
by reference in the Prospectus, there has been no material adverse
change in the financial position or results of operations of the
Company and its subsidiaries, or any change, or any development
including a prospective change, in or affecting the condition
(financial or otherwise), results of operations, business or prospects
of the Company and its subsidiaries taken as a whole, except as set
forth in the Prospectus.
(j) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and (ii) since
such date there shall not have been any change in the capital stock
(other than stock option grants and any exercises of stock options) or
long-term debt of the Company or any of its subsidiaries or any change,
or any development involving a prospective change, in or affecting the
business, general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of
Underwriting Agreement - Page 16
which, in any such case described in clause (i) or (ii), is, in the
judgment of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the sale or delivery of
the Stock on the terms and in the manner contemplated in the
Prospectus.
(k) No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any governmental
agency or body which would, as of the Closing Date, prevent the
issuance or sale of the Stock; and no injunction, restraining order or
order of any other nature by any federal or state court of competent
jurisdiction shall have been issued as of the Closing Date which would
prevent the issuance or sale of the Stock.
(l) Subsequent to the execution and delivery of this Agreement (i) no
downgrading shall have occurred in the rating accorded the Company's
debt securities by any "nationally recognized statistical rating
organization," as that term is defined by the Commission for purposes
of Rule 436(g)(2) of the Rules and Regulations and (ii) no such
organization shall have publicly announced that it has under
surveillance or review (other than an announcement with positive
implications of a possible upgrading), its rating of any of the
Company's debt securities.
(m) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange
or in the over-the-counter market, or trading in any securities of the
Company on any exchange or in the over-the-counter market, shall have
been suspended or minimum prices shall have been established on any
such exchange or such market by the Commission, by such exchange or by
any other regulatory body or governmental authority having
jurisdiction, (ii) a banking moratorium shall have been declared by
Federal or state authorities, (iii) the United States shall have become
engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of the Representatives,
impracticable or inadvisable to proceed with the sale or delivery of
the Stock on the terms and in the manner contemplated in the
Prospectus.
(n) The National Market System shall have approved the Stock for
quotation, subject only to official notice of issuance.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Underwriter, its
officers, employees, representative and agents and each person, if any,
who controls any Underwriter within the meaning of the Securities Act
(collectively the "Underwriter Indemnified Parties" and , each an
"Underwriter Indemnified Party") against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which
that Underwriter Indemnified Party may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in
the Preliminary Prospectus, either of the Registration Statements or
the Prospectus or in any amendment or supplement thereto (other than
the Prior Prospectuses) or (ii) the omission or alleged omission to
state in any Preliminary Prospectus, either of the Registration
Statements or the
Underwriting Agreement - Page 17
Prospectus or in any amendment or supplement thereto (other than the
Prior Prospectuses) a material fact required to be stated therein or
necessary to make the statements therein not misleading and shall
reimburse each Underwriter Indemnified Party promptly upon demand for
any legal or other expenses reasonably incurred by that Underwriter
Indemnified Party in connection with investigating or preparing to
defend or defending against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged
omission from the Preliminary Prospectus, either of the Registration
Statements or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to
the Company through the Representatives by or on behalf of any
Underwriter specifically for use therein, which information the parties
hereto agree is limited to the Underwriter's Information (as defined in
Section 16). This indemnity agreement is not exclusive and will be in
addition to any liability which the Company might otherwise have and
shall not limit any rights or remedies which may otherwise be available
at law or in equity to each Underwriter Indemnified Party.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company its officers, employees, representative and
agents, each of its directors and each person, if any, who controls the
Company within the meaning of the Securities Act (collectively the
"Company Indemnified Parties" and each a "Company Indemnified Party")
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company Indemnified Parties may
become subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage, liability or action arises out of or is based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Preliminary Prospectus, either of the Registration
Statements or the Prospectus or in any amendment or supplement thereto
(other than the Prior Prospectuses) or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, but in each
case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company through
the Representatives by or on behalf of that Underwriter specifically
for use therein, and shall reimburse the Company Indemnified Parties
for any legal or other expenses reasonably incurred by such parties in
connection with investigating or preparing to defend or defending
against or appearing as third party witness in connection with any such
loss, claim, damage, liability or action as such expenses are incurred;
provided that the parties hereto hereby agree that such written
information provided by the Underwriters consists solely of the
Underwriter's Information. This indemnity agreement is not exclusive
and will be in addition to any liability which the Underwriters might
otherwise have and shall not limit any rights or remedies which may
otherwise be available at law or in equity to the Company Indemnified
Parties.
(c) Promptly after receipt by an indemnified party under this Section 7
of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 7, notify the
indemnifying party in writing of the claim or the commencement of that
action; PROVIDED, HOWEVER, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under
this Section 7 except to the extent it has been materially prejudiced
by such failure; and, PROVIDED,
Underwriting Agreement - Page 18
FURTHER, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have to an indemnified party
otherwise than under this Section 7. If any such claim or action shall
be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any
other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of
its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under
this Section 7 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; PROVIDED, HOWEVER, that any
indemnified party shall have the right to employ separate counsel in
any such action and to participate in the defense thereof but the fees
and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the employment thereof has been
specifically authorized by the indemnifying party in writing, (ii) such
indemnified party shall have been advised by such counsel that there
may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party and in
the reasonable judgment of such counsel it is advisable for such
indemnified party to employ separate counsel or (iii) the indemnifying
party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in
writing that it elects to employ separate counsel at the expense of the
indemnifying party, the indemnifying party shall not have the right to
assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the
same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated
in writing by XX Xxxxx, if the indemnified parties under this Section 7
consist of any Underwriter Indemnified Party, or by the Company if the
indemnified parties under this Section 7 consist of any Company
Indemnified Parties. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 7(a) and 7(b), shall use all
reasonable efforts to cooperate with the indemnifying party in the
defense of any such action or claim. Subject to the provisions of
Section 7(d) below, no indemnifying party shall be liable for any
settlement of any such action effected without its written consent
(which consent shall not be unreasonably withheld), but if settled with
its written consent or if there be a final judgment for the plaintiff
in any such action, the indemnifying party agrees to indemnify and hold
harmless any indemnified party from and against any loss or liability
by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
Section 7(a) or 7(b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the
other from the offering of the Stock or if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to
in clause (i) above but also the relative fault of the Company on the
one hand and the Underwriters on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, 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 with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the offering
Underwriting Agreement - Page 19
of the Stock purchased under this Agreement (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters with respect to the Stock
purchased under this Agreement, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault 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 on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement
or omission; provided that the parties hereto agree that the written
information furnished to the Company through the Representatives by or
on behalf of the Underwriters for use in any Preliminary Prospectus,
either of the Registration Statements or the Prospectus consists solely
of the Underwriter's Information. The Company and the Underwriters
agree that it would not be just and equitable if contributions pursuant
to this Section 7(d) were to be determined by pro rata allocation (even
if the Underwriters were treated as one entity for such purpose) or by
any other method of allocation which does not take into account the
equitable considerations referred to herein. The amount paid or payable
by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this
Section 7(d) shall be deemed to include, for purposes of this Section
7(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section
7(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public were offered to the
public less the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any 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 Underwriters' obligations to contribute as provided in this Section
7(d) are several in proportion to their respective underwriting obligations and
not joint.
8. TERMINATION. The obligations of the Underwriters hereunder may be terminated
by XX Xxxxx, in its absolute discretion by notice given to and received by the
Company prior to delivery of and payment for the Stock if, prior to that time,
any of the events described in Sections 6(i), 6(k) or 6(m) have occurred or if
the Underwriters shall decline to purchase the Stock for any reason permitted
under this Agreement.
9. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) this Agreement shall have
been terminated pursuant to Section 8 or 10, (b) the Company shall fail to
tender the Stock for delivery to the Underwriters for any reason permitted under
this Agreement, or (c) the Underwriters shall decline to purchase the Stock for
any reason permitted under this Agreement, the Company shall reimburse the
Underwriters for the fees and expenses of their counsel and for such other
out-of-pocket expenses as shall have been reasonably incurred by them in
connection with this Agreement and the proposed purchase of the Stock, and upon
demand the Company shall pay the full amount thereof to XX Xxxxx. If this
Agreement is terminated pursuant to Section 10 by reason of the default of one
or more Underwriters, the Company shall not be obligated to reimburse any
defaulting Underwriter on account of those expenses.
10. SUBSTITUTION OF UNDERWRITERS. If any Underwriter or Underwriters shall
default in its or their obligations to purchase shares of Stock hereunder and
the aggregate number of shares which such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed ten percent (10%) of the total
number of shares underwritten, the other Underwriters shall be obligated
severally, in
Underwriting Agreement - Page 20
proportion to their respective commitments hereunder, to purchase the shares
which such defaulting Underwriter or Underwriters agreed but failed to purchase.
If any Underwriter or Underwriters shall so default and the aggregate number of
shares with respect to which such default or defaults occur is more than ten
percent (10%) of the total number of shares underwritten and arrangements
satisfactory to the Representatives and the Company for the purchase of such
shares by other persons are not made within forty-eight (48) hours after such
default, this Agreement shall terminate.
If the remaining Underwriters or substituted Underwriters are required
hereby or agree to take up all or part of the shares of Stock of a defaulting
Underwriter or Underwriters as provided in this Section 10, (i) the Company
shall have the right to postpone the Closing Date for a period of not more than
five (5) full business days in order that the Company may effect whatever
changes may thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company agrees
promptly to file any amendments to the Registration Statement or supplements to
the Prospectus which may thereby be made necessary, and (ii) the respective
numbers of shares to be purchased by the remaining Underwriters or substituted
Underwriters shall be taken as the basis of their underwriting obligation for
all purposes of this Agreement. Nothing herein contained shall relieve any
defaulting Underwriter of its liability to the Company or the other Underwriters
for damages occasioned by its default hereunder. Any termination of this
Agreement pursuant to this Section 10 shall be without liability on the part of
any non-defaulting Underwriter or the Company, except expenses to be paid or
reimbursed pursuant to Sections 5 and 9 and except the provisions of Section 7
shall not terminate and shall remain in effect.
11. SUCCESSORS; PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the several Underwriters, the
Company and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person other than the
persons mentioned in the preceding sentence any legal or equitable right, remedy
or claim under or in respect of this Agreement, or any provisions herein
contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person; except that the representations, warranties,
covenants, agreements and indemnities of the Company contained in this Agreement
shall also be for the benefit of the Underwriter Indemnified Parties, and the
indemnities of the several Underwriters shall also be for the benefit of the
Company Indemnified Parties.
12. SURVIVAL OF INDEMNITIES, REPRESENTATIONS, WARRANTIES, ETC. The respective
indemnities, covenants, agreements, representations, warranties and other
statements of the Company and the several Underwriters, as set forth in this
Agreement or made by them respectively, pursuant to this Agreement, shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter, the Company or any person controlling any of them and shall
survive delivery of and payment for the Stock.
13. NOTICES. All statements, requests, notices and agreements hereunder shall
be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to XX Xxxxx Securities Corporation, 0000
Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Head of
Equity Capital Markets (fax: 000-000-0000), with a copy to the Legal
Department (fax: 000-000-0000); provided, however, that any other
notice to an Underwriter pursuant to Section 7 hereof shall be
delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party
hereto by XX Xxxxx upon request ;
Underwriting Agreement - Page 21
(b) if to the Company shall be delivered or sent by mail, telex or
facsimile transmission to Transkaryotic Therapies, Inc. Attention:
Xxxxxx X. Xxxxxxx, Chief Financial Officer.
Any such statements, requests, notices and agreements shall take effect
at the time of receipt.
14. DEFINITION OF CERTAIN TERMS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
15. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. UNDERWRITERS' INFORMATION. The parties hereto acknowledge and agree that,
for all purposes of this Agreement, the Underwriters' Information consists
solely of the following information in the Prospectus: the statements concerning
the Underwriters contained in the third paragraph under the table in the section
called "Underwriting."
17. AUTHORITY OF THE REPRESENTATIVES. In connection with this Agreement, you
will act for and on behalf of the several Underwriters, and any action taken
under this Agreement by the Representatives, will be binding on all the
Underwriters.
18. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or
enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.
19. GENERAL. This Agreement constitutes the entire agreement of the parties to
this Agreement and supersedes all prior written or oral and all contemporaneous
oral agreements, understandings and negotiations with respect to the subject
matter hereof. In this Agreement, the masculine, feminine and neuter genders and
the singular and the plural include one another. The section headings in this
Agreement are for the convenience of the parties only and will not affect the
construction or interpretation of this Agreement. This Agreement may be amended
or modified, and the observance of any term of this Agreement may be waived,
only by a writing signed by the Company and the Representatives.
20. COUNTERPARTS. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
21. CONSENT. Pursuant to Section 4(h) of the Underwriting Agreement dated
December 12, 2001 between the Company and XX Xxxxx, on behalf of itself and on
behalf of Deutsche Banc Alex. Xxxxx Inc., Pacific Growth Equities, Inc. and
Leerink Xxxxx & Co., XX Xxxxx hereby consents to the Company's issuance and sale
of the Stock pursuant to the terms hereunder.
[SIGNATURES ON NEXT PAGE.]
Signature Page to Underwriting Agreement
If the foregoing is in accordance with your understanding of the
agreement between the Company and the several Underwriters, kindly indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
TRANSKARYOTIC THERAPIES, INC.
By: /s/ Xxxxxxx X Xxxxxx
-------------------------------------
Name:
Title:
Accepted as of the date first above written:
XX XXXXX SECURITIES CORPORATION
DEUTSCHE BANC ALEX. XXXXX
PACIFIC GROWTH EQUITIES, INC.
LEERINK XXXXX & CO.
Acting on their own behalf and as the Representatives of
the several Underwriters referred to in the foregoing
Agreement
By: XX XXXXX SECURITIES CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
------------------------------
Authorized Signatory
SCHEDULE A
NUMBER OF FIRM SHARES
NAME TO BE PURCHASED
XX Xxxxx Securities Corporation 450,000
Deutsche Banc Alex. Xxxxx Inc. 350,000
Pacific Growth Equities, Inc. 150,000
Leerink Xxxxx & Co. 50,000
---------
TOTALS 1,000,000
