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THE MEDICINES COMPANY
5,000,000 Shares of Common Stock
Underwriting Agreement
[ ], 2000
X.X. Xxxxxx Securities Inc.
FleetBoston Xxxxxxxxx Xxxxxxxx Inc.
CIBC World Markets Corp.
As Representatives of the several Underwriters
listed in Schedule I hereto
c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The Medicines Company, a Delaware corporation (the "COMPANY"), proposes to
issue and sell to the several Underwriters listed in SCHEDULE I hereto (the
"UNDERWRITERS"), for whom you are acting as representatives (the
"REPRESENTATIVES"), an aggregate of 5,000,000 shares (the "UNDERWRITTEN SHARES")
of Common Stock, par value $0.001 per share, of the Company (the "COMMON
STOCK"). In addition, for the sole purpose of covering over-allotments in
connection with the sale of the Underwritten Shares, the Company proposes to
issue and sell to the Underwriters, at the option of the Underwriters, up to an
additional 750,000 shares (the "OPTION SHARES") of Common Stock. The
Underwritten Shares and the Option Shares are herein referred to as the
"SHARES."
As part of the offering contemplated by this Agreement, X.X. Xxxxxx
Securities Inc. (in such capacity, the "DESIGNATED UNDERWRITER") has agreed to
reserve out of the Underwritten Shares purchased by them under this Agreement,
up to five percent or 250,000 shares, for sale to the Company's directors,
officers, employees and other parties associated with the Company (collectively,
"PARTICIPANTS"), as set forth in the Prospectus (as defined herein) under the
heading "Underwriting" (the "DIRECTED SHARE PROGRAM"). The Underwritten Shares
to be sold by the Designated Underwriter pursuant to the Directed Share Program
(the "DIRECTED SHARES") will be sold by the Designated Underwriter at the public
offering price. Any Directed Shares not orally confirmed for purchase by a
Participant by the end of the day on which this
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Agreement is executed will be offered to the public by the Underwriters as set
forth in the Prospectus.
The Company has prepared and filed with the Securities and Exchange
Commission (the "COMMISSION"), in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "SECURITIES ACT"), a registration
statement, including a prospectus, relating to the Shares. The registration
statement as amended at the time when it became or shall become effective,
including information (if any) deemed to be part of the registration statement
at the time of effectiveness pursuant to Rule 430A under the Securities Act, is
referred to in this Agreement as the "REGISTRATION STATEMENT," and the
prospectus in the form first used to confirm sales of Shares is referred to in
this Agreement as the "PROSPECTUS." If the Company has filed an abbreviated
registration statement pursuant to Rule 462(b) under the Securities Act (the
"RULE 462 REGISTRATION STATEMENT"), then any reference herein to the term
"REGISTRATION STATEMENT" shall be deemed to include such Rule 462 Registration
Statement. The term "PRELIMINARY PROSPECTUS" means any preliminary prospectus
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.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Underwritten Shares to the
several Underwriters as hereinafter provided, and each Underwriter, upon the
basis of the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees to purchase, severally and not jointly,
from the Company at a purchase price per share of $[ ] (the "PURCHASE PRICE")
the number of Underwritten Shares to be purchased by such Underwriter as set
forth opposite the name of such Underwriter in SCHEDULE I hereto.
In addition, the Company agrees to issue and sell the Option Shares to the
several Underwriters as hereinafter provided, and each Underwriter, upon the
basis of the representations and warranties herein contained, but subject to the
conditions hereinafter stated, shall have the option to purchase, severally and
not jointly, from the Company at the Purchase Price that portion of the number
of Option Shares as to which such election shall have been exercised (to be
adjusted by you so as to eliminate fractional shares) determined by multiplying
such number of Option Shares by a fraction, the numerator of which is the
maximum number of Underwritten Shares which such Underwriter is entitled to
purchase as set forth opposite the name of such Underwriter in SCHEDULE I hereto
and the denominator of which is the maximum number of Underwritten Shares which
all of the Underwriters are entitled to purchase hereunder, for the sole purpose
of covering over-allotments (if any) in the sale of Underwritten Shares by the
several Underwriters.
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The Underwriters may exercise the option to purchase the Option Shares at
any time (but not more than once) on or before the thirtieth day following the
date of this Agreement, by written notice from the Representatives to the
Company. Such notice shall set forth the aggregate number of Option Shares as to
which the option is being exercised and the date and time when the Option Shares
are to be delivered and paid for, which may be the same date and time as the
Closing Date (as hereinafter defined) but shall not be earlier than the Closing
Date nor later than the tenth full Business Day (as hereinafter defined) after
the date of such notice (unless such time and date are postponed in accordance
with the provisions of Section 9 hereof). Any such notice shall be given at
least two Business Days prior to the date and time of delivery specified
therein.
2. The Company understands that the Underwriters intend (i) to make a
public offering of the Shares as soon after (A) the Registration Statement has
become effective and (B) the parties hereto have executed and delivered this
Agreement as in the judgment of the Representatives is advisable and (ii)
initially to offer the Shares upon the terms set forth in the Prospectus.
3. Payment for the Shares shall be made by wire transfer in immediately
available funds to the account specified by the Company to the Representatives,
in the case of the Underwritten Shares, on [ ], 2000, or at such other time on
the same or such other date, not later than the fifth Business Day thereafter,
as the Representatives and the Company may agree upon in writing, or, in the
case of the Option Shares, on the date and time specified by the Representatives
in the written notice of the Underwriters' election to purchase such Option
Shares. The time and date of such payment for the Underwritten Shares is
referred to herein as the "CLOSING DATE," and the time and date for such payment
for the Option Shares, if other than the Closing Date, is herein referred to as
the "ADDITIONAL CLOSING DATE." As used herein, the term "BUSINESS DAY" means any
day other than a day on which banks are permitted or required to be closed in
New York City.
Payment for the Shares to be purchased on the Closing Date or the
Additional Closing Date, as the case may be, shall be made against delivery to
the Representatives for the respective accounts of the several Underwriters of
the Shares to be purchased on such date registered in such names and in such
denominations as the Representatives shall request in writing not later than two
full Business Days prior to the Closing Date or the Additional Closing Date, as
the case may be, with any transfer taxes payable in connection with the transfer
to the Underwriters of the Shares duly paid by the Company. The certificates for
the Shares will be made available for inspection and packaging by the
Representatives at the office of X.X. Xxxxxx Securities Inc. set forth above not
later than 1:00 P.M., New York City time, on the Business Day prior to the
Closing Date or the Additional Closing Date, as the case may be.
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4. The Company hereby represents and warrants to each of the several
Underwriters that:
(a) no order preventing or suspending the use of any preliminary
prospectus has been issued by the Commission, and each preliminary
prospectus 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 did not contain an 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, in the light of the circumstances
under which they were made, not misleading; provided that the foregoing
representations and warranties shall not apply to any statements or
omissions made in reliance upon and in conformity with information relating
to any Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use therein;
(b) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of the Company, threatened by the
Commission; the Registration Statement and the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) comply, or will comply, as the case may be, in all
material respects with the Securities Act and do not and will not, as of
the applicable effective date as to the Registration Statement and any
amendment thereto and as of the date of the Prospectus and any amendment or
supplement thereto, 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, and the Prospectus, as amended
or supplemented, if applicable, at the Closing Date or Additional Closing
Date, as the case may be, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading, except that the foregoing representations and
warranties shall not apply to any statements or omissions in the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information relating to any Underwriter furnished to the
Company in writing by such Underwriter through the Representatives
expressly for use therein;
(c) the consolidated financial statements, and the related notes
thereto, included in the Registration Statement and the Prospectus present
fairly the consolidated financial position of the Company and its
consolidated subsidiaries as of the dates indicated and the results of
their operations and changes in their consolidated cash flows for the
periods specified; said financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis, and the supporting schedules included in the Registration
Statement present fairly the infor-
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mation required to be stated therein; and the pro forma financial
information, and the related notes thereto, included in the Registration
Statement and the Prospectus has been prepared in accordance with the
applicable requirements of the Securities Act and the Securities Exchange
Act of 1934 (the "EXCHANGE ACT"), as applicable, and is based upon good
faith estimates and assumptions believed by the Company to be reasonable;
(d) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any change in
the capital stock (except for the exercise of stock options or the issuance
of shares pursuant to the Company's employee stock plan, the payment of
accrued dividends pursuant to the outstanding shares of convertible
preferred stock or the exercise of the warrants issued in October 1999 and
March 2000, in each case as described in the Registration Statement and the
Prospectus) or long-term debt of the Company or any of its subsidiaries, or
any material adverse change, or any development that would reasonably be
expected to cause a prospective material adverse change, in or affecting
the general affairs, business, prospects, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE CHANGE"), otherwise
than as set forth or contemplated in the Registration Statement and the
Prospectus; and except as set forth or contemplated in the Registration
Statement and the Prospectus, neither the Company nor any of its
subsidiaries has entered into any transaction or agreement (whether or not
in the ordinary course of business) material to the Company and its
subsidiaries, taken as a whole;
(e) the Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties and
conduct its business as described in the Registration Statement and the
Prospectus, and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, other than where the failure
to be so qualified or in good standing would not have a material adverse
effect on the general affairs, business, prospects, management, financial
position, stockholders' equity or results of operations of the Company and
its subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT");
(f) each of the Company's subsidiaries has been duly incorporated and
is validly existing as a corporation under the laws of its jurisdiction of
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Registration
Statement and the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under
the laws of each jurisdiction in which it owns or leases properties, or
con-
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ducts any business, so as to require such qualification, other than where
the failure to be so qualified or in good standing would not have a
Material Adverse Effect; and 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, in the case of
foreign subsidiaries, for directors' qualifying shares and except as
described in the Registration Statement and the Prospectus) are owned by
the Company, directly or indirectly, free and clear of all liens,
encumbrances, security interests and claims;
(g) this Agreement has been duly authorized, executed and delivered by
the Company;
(h) the Company has an authorized capitalization as set forth in the
Registration Statement and the Prospectus and such authorized capital stock
conforms in all material respects as to legal matters to the description
thereof set forth in the Registration Statement and the Prospectus, and all
of the outstanding shares of capital stock of the Company have been duly
authorized and validly issued, are fully paid and non-assessable and are
not subject to any pre-emptive or similar rights under the Company's
certificate of incorporation or any contracts to which the Company is a
party; and, except as described in or expressly contemplated by the
Registration Statement and the Prospectus, there are no outstanding rights
(including, without limitation, pre-emptive rights), warrants or options to
acquire, or instruments convertible into or exchangeable for, any shares of
capital stock or other equity interest in the Company or any of its
subsidiaries, or any contract, commitment, agreement, understanding or
arrangement of any kind relating to the issuance of any capital stock of
the Company or any such subsidiary, any such convertible or exchangeable
securities or any such rights, warrants or options;
(i) the Shares have been duly authorized, and, when issued and
delivered to and paid for by the Underwriters in accordance with the terms
of this Agreement, will be duly issued and will be fully paid and
non-assessable and will conform in all material respects to the description
thereof set forth in the Registration Statement and the Prospectus; and the
issuance of the Shares is not subject to any preemptive or similar rights;
(j) neither the Company nor any of its subsidiaries is, or with the
giving of notice or lapse of time or both would be, in violation of or in
default under its certificate of incorporation or by-laws or 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 it or
any of them or any of their respective properties is bound, except for
violations and defaults which would not, individually or in the aggregate,
have a Material Adverse Effect; the issuance and sale of the Shares and the
performance by
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the Company of its obligations under this Agreement and the consummation of
the transactions contemplated herein and in the Registration Statement and
the Prospectus will not conflict with, result in a breach of or violate 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 to which any of
the property or assets of the Company or any of its subsidiaries is
subject, nor will any such action result in any violation of the provisions
of the certificate of incorporation or by-laws of the Company or any of its
subsidiaries or any applicable law or statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company, its subsidiaries or any of their respective properties;
and no consent, approval, authorization, order, license, registration or
qualification of or with any such court or governmental agency or body is
required for the issuance and sale of the Shares or the consummation by the
Company of the transactions contemplated by this Agreement and the
Registration Statement and the Prospectus, except such consents, approvals,
authorizations, orders, licenses, registrations or qualifications as have
been obtained or made under the Securities Act and as may be required under
state securities or blue sky laws in connection with the purchase and
distribution of the Shares by the Underwriters;
(k) other than as set forth in the Registration Statement and the
Prospectus, there are no legal or governmental investigations, actions,
suits or proceedings pending or, to the knowledge of the Company,
threatened against or affecting the Company or any of its subsidiaries or
any of their respective properties or to which the Company or any of its
subsidiaries is a party or to which any property of the Company or any of
its subsidiaries is the subject which would, individually or in the
aggregate, have, or reasonably be expected to have, a Material Adverse
Effect, and, to the Company's knowledge, no such proceedings are threatened
or contemplated by governmental authorities or threatened by others;
(l) there are no statutes, regulations, contracts or other documents
or legal or governmental investigations, actions, suits or proceedings
pending or, to the knowledge of the Company, threatened that are required
to be described in the Registration Statement or Prospectus or to be filed
as exhibits to the Registration Statement, as the case may be, that are not
described or filed as required;
(m) the Company and its subsidiaries have good and marketable title in
fee simple to all items of real property and good and marketable title to
all personal property owned by them, in each case free and clear of all
liens, encumbrances and defects except such as are described or referred to
in the Registration Statement and the Prospectus or such as do not
materially affect the value of such property and do not inter-
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fere with the use made or 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, existing and enforceable leases with such exceptions as are not
material and do not interfere with the use made or proposed to be made of
such property and buildings by the Company or its subsidiaries;
(n) no relationship, direct or indirect, exists between or among the
Company or any of its subsidiaries, on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Company or any of its
subsidiaries, on the other hand, which is required by the Securities Act to
be described in the Registration Statement and the Prospectus which is not
so described;
(o) no person has the right to require the Company to register any
securities for offering and sale under the Securities Act by reason of the
filing of the Registration Statement with the Commission or by reason of
the issuance and sale of the Shares, except for rights which have been
waived;
(p) the Company is not and, after giving effect to the offering and
the sale of the Shares, will not be an "investment company" or an entity
"controlled" by and "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY ACT");
(q) Ernst & Young LLP ("ERNST & YOUNG"), who have certified certain
financial statements of the Company and its subsidiaries, are independent
public accountants as required by the Securities Act;
(r) the Company and its subsidiaries have filed all material federal,
state, local and foreign tax returns which have been required to be filed
and have paid all taxes shown thereon and all assessments received by them
or any of them to the extent that such taxes have become due and are not
being contested in good faith; and, except as disclosed in the Registration
Statement and the Prospectus, no tax deficiency has been determined
adversely to the Company or any subsidiary which has had, nor does the
Company have any knowledge of any tax deficiencies, individually or in the
aggregate, which would reasonably be expected to have a Material Adverse
Effect;
(s) the Company has not taken nor will it take, directly or
indirectly, any action designed to, or that would be reasonably expected
to, cause or result in stabilization or manipulation of the price of the
Common Stock;
(t) the statistical and market-related data included in the
Registration Statement and the Prospectus are based on or derived from
sources which, to the best of the Company's knowledge, are reliable;
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(u) Each of the Company and its subsidiaries owns, possesses or has
obtained all licenses, permits, certificates, consents, orders, approvals
and other authorizations from, and has made all declarations and filings
with, all federal, state, local and other governmental authorities
(including foreign regulatory agencies), all self-regulatory organizations
and all courts and other tribunals, domestic or foreign, necessary to own
or lease, as the case may be, and to operate its properties and to carry on
its business as conducted as of the date hereof, except where the failure
to own, possess, obtain or make would not, individually or in the
aggregate, have a Material Adverse Effect, and neither the Company nor any
of its subsidiaries has received any actual notice of any proceeding
relating to revocation or modification of any such license, permit,
certificate, consent, order, approval or other authorization, except as
described in the Registration Statement and the Prospectus, and each of the
Company and its subsidiaries is in compliance in all material respects with
all laws and regulations relating to the conduct of its business as
conducted as of the date hereof, and all of the descriptions in the
Registration Statement and the Prospectus of the legal and governmental
proceedings and procedures by or before the United States Food and Drug
Administration (the "FDA") or any foreign, state --- or local governmental
body exercising comparable authority are accurate in all material respects;
(v) except as described in the Registration Statement and the
Prospectus, each of the Company and its subsidiaries owns, is licensed to
use or otherwise possesses adequate rights to use the patents, patent
rights, licenses, inventions, trademarks, service marks, trade names,
copyrights and know-how, including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems,
processes or procedures (collectively, the "INTELLECTUAL PROPERTY"),
reasonably necessary to carry on the business conducted by it, except to
the extent that the failure to own, be licensed to use or otherwise possess
adequate rights to use such Intellectual Property would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect; the Company has not received any notice of infringement of or
conflict with, and the Company has no knowledge of any infringement of or
conflict with, asserted rights of others with respect to its Intellectual
Property which would reasonably be expected to result in a Material Adverse
Effect; the discoveries, inventions, products or processes of the Company
referred to in the Registration Statement and the Prospectus do not, to the
knowledge of the Company, infringe or conflict with any right or patent of
any third party, or any discovery, invention, product or process which is
the subject of a patent application filed by any third party; except as set
forth in the Registration Statement and the Prospectus, the Company is not
obligated to pay a royalty, grant a license or provide other consideration
to any third party in connection with the Company's patents, patent rights,
licenses, inventions, trademarks, service marks, trade names, copyrights
and know-how; and, to the best of the Company's knowledge, no third party,
including any academic or governmental organization, pos-
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sesses rights to the Intellectual Property which, if exercised, could
enable such third party to develop products competitive with those of the
Company or its Subsidiaries or would reasonably be expected to have a
Material Adverse Effect;
(w) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, the studies, tests and
preclinical and clinical trials conducted by or on behalf of the Company
that are described in the Registration Statement and the Prospectus were
and, if still pending, are being conducted in all material respects in
accordance with experimental protocols, procedures and controls pursuant
to, where applicable, accepted professional scientific standards; the
descriptions of the results of such studies, tests and trials contained in
the Registration Statement and the Prospectus are accurate in all material
respects; and since [ ], the Company has not received any notices or
correspondence from the FDA or any foreign, state or local governmental
body exercising comparable authority requiring the termination, suspension
or material modification of any studies, tests or preclinical or clinical
trials conducted by or on behalf of the Company which termination,
suspension or material modification would reasonably be expected to have a
Material Adverse Effect;
(x) there are no existing or, to the knowledge of the Company,
threatened labor disputes with the employees of the Company which would
reasonably be expected to have a Material Adverse Effect;
(y) the Company carries, or is covered by, insurance in such amounts
and covering such risks as it believes is adequate for the conduct of its
business and the value of its properties and as is customary for companies
engaged in similar businesses in similar industries;
(z) the Company (i) is in compliance with any and all applicable
foreign, federal, state 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 (collectively,
"ENVIRONMENTAL LAWS"), (ii) has received all permits, licenses or other
approvals required of it under applicable Environmental Laws to conduct its
businesses and (iii) is 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, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect;
(aa) each employee benefit plan, within the meaning of Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
that is maintained, administered or contributed to by the Company or any of
its affiliates for
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employees or former employees of the Company and its affiliates has been
maintained in material compliance with its terms and the requirements of
any applicable statutes, orders, rules and regulations, including but not
limited to ERISA and the Internal Revenue Code of 1986, as amended
("CODE"); no prohibited transaction, within the meaning of Section 406 of
ERISA or Section 4975 of the Code, has occurred with respect to any such
plan excluding transactions effected pursuant to a statutory or
administrative exemption; for each such plan which is subject to the
funding rules of Section 412 of the Code or Section 302 of ERISA, no
"accumulated funding deficiency," as defined in Section 412 of the Code,
has been incurred, whether or not waived, and the fair market value of the
assets of each such plan (excluding for these purposes accrued but unpaid
contributions) exceed the present value of all benefits accrued under such
plan determined using reasonable actuarial assumptions;
(bb) (i) the Registration Statement, the Prospectus and any
preliminary prospectus comply, and any further amendments or supplements
thereto will comply, with any applicable laws or regulations of foreign
jurisdictions in which the Prospectus or any preliminary prospectus, as
amended or supplemented, if applicable, are distributed in connection with
the Directed Share Program, and (ii) no authorization, approval, consent,
license, order, registration or qualification of or with any government,
governmental instrumentality or court, other than such as have been
obtained, is necessary under the securities laws and regulations of foreign
jurisdictions in which the Directed Shares are offered outside the United
States; and
(cc) the Company has not offered, or caused the Underwriters to offer,
any Shares to any person pursuant to the Directed Share Program with the
specific intent to unlawfully influence (i) a customer or supplier of the
Company to alter the customer's or supplier's level or type of business
with the Company or (ii) a trade journalist or publication to write or
publish favorable information about the Company or its products.
5. The Company covenants and agrees with each of the several Underwriters
as follows:
(a) if the Registration Statement is not already effective, to use its
best efforts to cause the Registration Statement to become effective at the
earliest possible time and, if required, to file the Prospectus with the
Commission within the time periods specified by Rule 424(b) and Rule 430A
under the Securities Act and to furnish copies of the Prospectus to the
Underwriters in New York City prior to 10:00 a.m., New York City time, on
the Business Day next succeeding the date of this Agreement in such
quantities as the Representatives may reasonably request;
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(b) to deliver, at the expense of the Company, to the Representatives
five signed copies of the Registration Statement (as originally filed) and
each amendment thereto, in each case including exhibits, and to each other
Underwriter a conformed copy of the Registration Statement (as originally
filed) and each amendment thereto, in each case without exhibits and,
during the period mentioned in paragraph (e) below, to each of the
Underwriters as many copies of the Prospectus (including all amendments and
supplements thereto) as the Representatives may reasonably request;
(c) before filing any amendment or supplement to the Registration
Statement or the Prospectus, whether before or after the time the
Registration Statement becomes effective, to furnish to the Representatives
a copy of the proposed amendment or supplement for review and, except as
required by law, not to file any such proposed amendment or supplement to
which the Representatives reasonably object;
(d) to advise the Representatives promptly, and, if requested, to
confirm such advice in writing, (i) when the Registration Statement has
become effective, (ii) when any amendment to the Registration Statement has
been filed or becomes effective, (iii) when any supplement to the
Prospectus or any amended prospectus has been filed and to furnish the
Representatives with copies thereof, (iv) of any request by the Commission
for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for any additional information, (v) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or of any order preventing or suspending the
use of any preliminary prospectus or the Prospectus or the initiation or
threatening of any proceeding for that purpose, (vi) of the occurrence of
any event, during the period mentioned in paragraph (e) below, as a result
of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not
misleading, and (vii) of the receipt by the Company of any notification
with respect to any suspension of the qualification of the Shares for offer
and sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and to use its best efforts to prevent the
issuance of any such stop order, or of any order preventing or suspending
the use of any preliminary prospectus or the Prospectus, or of any order
suspending any such qualification of the Shares, or notification of any
such order thereof, and, if issued, to use its best efforts to obtain as
soon as possible the withdrawal thereof;
(e) if, during the period in which a Prospectus is required by the
Securities Act to be delivered in connection with sales by the Underwriters
or any dealer, any event shall occur as a result of which it is necessary
to amend or supplement the Prospectus in order to make the statements
therein, in light of the circumstances when the Pro-
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spectus is delivered to a purchaser, not misleading, or if it is necessary
to amend or supplement the Prospectus to comply with law, forthwith to
prepare and furnish, at the expense of the Company, 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, such
amendments or supplements to the Prospectus as may be necessary so that the
statements in the Prospectus as so amended or supplemented will not, in the
light of the circumstances when the Prospectus is delivered to a purchaser,
be misleading or so that the Prospectus will comply with law;
(f) prior to any public offering of the Shares by the Underwriters,
the Company will cooperate with the Representatives and counsel to the
Underwriters in connection with the registration and qualification of the
Shares for offer and sale under the securities or blue sky laws of such
jurisdictions as the Representatives shall reasonably request; provided
that the Company shall not be obligated to qualify to do business in any
jurisdiction in which it is not now qualified or take any action which
would subject it to general service of process in any jurisdiction where it
is not now subject;
(g) to make generally available to its security holders and to the
Representatives as soon as practicable an earnings statement covering a
period of at least twelve months beginning with the first fiscal quarter of
the Company occurring after the effective date of the Registration
Statement, which shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 of the Commission promulgated thereunder;
(h) for a period of five years from the Closing Date, to furnish to
the Representatives copies of all reports or other communications
(financial or other) furnished to holders of the Shares, and copies of any
reports and financial statements furnished to or filed with the Commission
or any national securities exchange;
(i) for a period of 180 days after the date of the initial public
offering of the Shares not to, (i) directly or indirectly, offer, pledge,
announce the intention to sell, 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 or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities of the
Company which are substantially similar to the Common Stock, including but
not limited to any securities convertible into or exercisable or
exchangeable for, or that represent the right to receive, Common Stock or
any such substantially similar securities (including, but not limited to,
any securities which may be issued upon exercise of a stock option or
warrant) or (ii) enter into any swap, option, future, forward or other
agreement that transfers, in whole or in part, any of the economic
consequences of
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ownership of the Common Stock or any such substantially similar securities,
whether any such transaction described in clause (i) or (ii) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise without the prior written consent of X.X. Xxxxxx Securities Inc.,
acting as representative of the Underwriters, other than the Shares to be
sold hereunder and any options granted or shares of Common Stock of the
Company issued upon the exercise of options granted or to be granted under
or shares of Common Stock issued pursuant to the Company's stock option
plans existing on the date of the Prospectus, shares of Common Stock
issuable upon the exercise of Warrants outstanding on the date hereof and
shares issued in connection with a joint venture, collaboration, product
acquisition or acquisitions;
(j) to use its best efforts to enforce the Section 10 of the Amended
and Restated Registration Rights Agreement, dated as of August 12, 1998, as
amended (the "Lock-up Provision"), against all security holders of the
Company party thereto and to not grant a release or waiver from the Lock-up
Provision to any such stockholder without the prior written consent of X.X.
Xxxxxx Securities Inc. acting as representative of the Underwriters;
(k) to use the net proceeds received by the Company from the sale of
the Shares pursuant to this agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(l) to file with the Commission such reports as may be required by
Rule 463 under the Securities Act;
(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
costs and expenses incident to the performance of its obligations
hereunder, including, without limiting the generality of the foregoing, all
costs and expenses (i) incident to the preparation, registration, transfer,
execution and delivery of the Shares, (ii) incident to the preparation,
printing and filing under the Securities Act of the Registration Statement,
the Prospectus and any preliminary prospectus, including in each case all
exhibits, amendments and supplements thereto, (iii) the listing fee of the
Nasdaq National Market, (iv) related to any filings required to be made
with the National Association of Securities Dealers, Inc., (v) in
connection with the printing (including word processing and duplication
costs) and delivery of this Agreement, any blue sky memoranda and the
furnishing to the Underwriters and dealers of copies of the Registration
Statement and the Prospectus as may be reasonably requested for use in
connection with the offering and sale of the Shares by the Underwriters or
by dealers to whom shares may be sold, including mailing and shipping, as
herein provided, (vi) any expenses incurred by the Company in connection
with a "road show" presentation to potential investors,
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(vii) the cost of preparing stock certificates, (viii) the cost and charges
of the Company's transfer agent and registrar, and (ix) costs and expenses
(including all filing fees) incurred in connection with the registration or
qualification of the Shares under the laws of such jurisdictions as the
Representatives may reasonably designate (including reasonable fees of
counsel for the Underwriters and its disbursements). It is understood,
however, that, except as otherwise agreed by the Company and the
Underwriters and except as provided in this Section 5, Section 7 and
Section 10 hereof, the Underwriters will pay all of their own costs and
expenses, including the fees of their counsel;
(n) in connection with the Directed Share Program, to ensure that the
Directed Shares will be restricted to the extent required by the National
Association of Securities Dealers, Inc. (the "NASD") or the NASD rules from
sale, transfer, assignment, pledge or hypothecation for a period of three
months following the date of the effectiveness of the Registration
Statement. The Designated Underwriters will notify the Company as to which
Participants will need to be so restricted. The Company will direct the
transfer agent to place stop transfer restrictions upon such securities for
such period of time; and
(o) to pay all reasonable fees and disbursements of counsel incurred
by the Underwriters in connection with the Directed Shares Program and
stamp duties, similar taxes or duties or other taxes, if any, incurred by
the Underwriters in connection with the Directed Share Program.
Furthermore, the Company covenants with the Underwriters that the
Company will comply with all applicable securities and other applicable
laws, rules and regulations in each foreign jurisdiction in which the
Directed Shares are offered in connection with the Directed Share Program.
6. The several obligations of the Underwriters hereunder to purchase the
Shares on the Closing Date or the Additional Closing Date, as the case may be,
are subject to the performance by the Company of its obligations hereunder and
to the following additional conditions:
(a) the Registration Statement shall have become effective (or if a
post-effective amendment is required to be filed under the Securities Act,
such post-effective amendment shall have become effective) not later than
5:00 p.m., New York City time, on the date hereof; and no stop order
suspending the effectiveness of the Registration Statement or any
post-effective amendment shall be in effect, and no proceedings for such
purpose shall be pending before or threatened by the Commission; the
Prospectus shall have been filed with the Commission pursuant to Rule
424(b) within the applicable time period prescribed for such filing by the
rules and regulations
16
-16-
under the Securities Act and in accordance with Section 5(a) hereof; and
all requests for additional information shall have been complied with to
the satisfaction of the Representatives;
(b) the representations and warranties of the Company contained herein
are true and correct on and as of the Closing Date or the Additional
Closing Date, as the case may be, as if made on and as of the Closing Date
or the Additional Closing Date, as the case may be, and the Company shall
have complied with all agreements and all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date or the
Additional Closing Date, as the case may be;
(c) since the respective dates as of which information is given in the
Prospectus, there shall not have been any material change in the capital
stock or long-term debt of the Company or its subsidiaries, or any Material
Adverse Change, otherwise than as set forth or contemplated in the
Prospectus, the effect of which in the reasonable judgment of the
Representatives makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares on the Closing Date or the
Additional Closing Date, as the case may be, on the terms and in the manner
contemplated in the Prospectus; and neither the Company nor any of its
subsidiaries has sustained since the date of the latest audited financial
statements included 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;
(d) the Representatives shall have received on and as of the Closing
Date or the Additional Closing Date, as the case may be, a certificate of
the Chief Executive Officer and Chief Financial Officer of the Company,
reasonably satisfactory to the Representatives, to the effect set forth in
subsections (a) through (c) (with respect to the respective
representations, warranties, agreements and conditions of the Company) of
this Section 6 and to the further effect that there has not occurred any
Material Adverse Change from that set forth or contemplated in the
Registration Statement;
(e) Xxxx and Xxxx LLP, counsel for the Company, shall have furnished
to the Representatives their written opinion (which may be in the form of
more than one opinion), dated the Closing Date or the Additional Closing
Date, as the case may be, in form and substance 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, with requisite corporate power and authority to own its
properties and conduct its business as described in the Registration
Statement and the Prospectus;
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(ii) the Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws
of each jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than
where the failure to be so qualified or in good standing would not
have a Material Adverse Effect;
(iii) to the best of such counsel's knowledge, other than as set
forth or contemplated in the Registration Statement and the
Prospectus, there are no legal or governmental investigations,
actions, suits or proceedings pending or, threatened against or
affecting the Company or any of its subsidiaries or any of their
respective properties or to which the Company or any of its
subsidiaries is or may be a party or to which any property of the
Company or its subsidiaries is or may be the subject, and, to the best
of such counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others; and
to the best of such counsel's knowledge there are no statutes,
regulations, contracts or other documents to which the Company is a
party that are required to be described in the Registration Statement
or Prospectus or to be filed as exhibits to the Registration Statement
that are not described or filed as required;
(iv) this Agreement has been duly authorized, executed and
delivered by the Company;
(v) the authorized capital stock of the Company conforms in all
material respects as to legal matters to the description thereof
contained in the Registration Statement and the Prospectus;
(vi) the issued and outstanding shares of capital stock of the
Company have been duly authorized and are validly issued, fully paid
and non-assessable;
(vii) the Shares to be issued and sold by the Company hereunder
have been duly authorized and, when delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable and the issuance of the
Shares is not subject to any preemptive or similar right under the
certificate of incorporation of the Company or the General Corporation
Law of the State of Delaware;
(viii) the information in the Prospectus under "Description of
Capital Stock," "Management -- 2000 Outside Director Stock Option
Plan," "Management--Employment Agreements," "Management--Employee
Benefit Plans," "Management -- Change in Control Arrangements," and
in the Registration State-
18
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ment in Items 14 and 15, to the extent that it constitutes matters of
law or legal conclusions has been reviewed by us and is a fair summary
of such matters and conclusions;
(ix) the Registration Statement and the Prospectus and any
supplement or amendment thereto (other than any financial statements
including the notes and related schedules and other financial and
accounting data included therein as to which such counsel need express
no opinion) as of the Effective Date complied as to form in all
material respects with the Securities Act;
(x) no consent, approval, authorization, order, license,
registration or qualification of or with any court or government
agency or body having jurisdiction over the Company or over its
properties or operations is necessary for the consummation by the
Company of the transactions contemplated by this Agreement, except
such consents, approvals, authorizations, orders, licenses,
registrations or qualifications as have been obtained under the
Securities Act, such as may be required by the National Association of
Securities Dealers, Inc. and as may be required under state securities
or blue sky laws in connection with the purchase and distribution of
the Shares by the Underwriters;
(xi) the Company is not and, after giving effect to the offering
and sale of the Shares and the application of the proceeds thereof as
described in the Prospectus, will not be required to register as an
"investment company" as such term is defined in the Investment Company
Act;
(xii) the performance by the Company of its obligations under
this Agreement and the consummation of the transactions contemplated
herein (other than performance of obligations arising under the
indemnification or contribution provisions of this Agreement, as to
which we express no opinion) will not, to our knowledge, result in a
material breach 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 filed as an exhibit to the
Registration Statement, nor will any such action result in any
violation of the provisions of the certificate of incorporation or the
by-laws of the Company, each as amended to date, or any applicable law
or statute, rule or regulation known to us or, to our knowledge, any
order specifically naming the Company of any court or governmental
agency or body having jurisdiction over the Company, its material
subsidiaries or any of their respective properties, except for such
conflicts, breaches and defaults which would not, individually or in
the aggregate, have a Material Adverse Effect;
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(xiii) each of the Company and its subsidiaries owns, possesses
or has adequate rights to use the Intellectual Property reasonably
necessary to carry on the business conducted by it as of the date
hereof except to the extent that the failure to own, possess or have
adequate rights to use such Intellectual Property would not,
individually or in the aggregate, have a Material Adverse Effect;
(xiv) other than as set forth or contemplated in the Registration
Statement and the Prospectus, the Company has not received any notice
of infringement of or conflict with, and such counsel has no knowledge
of any infringement of or conflict with, asserted rights of others
with respect to the Company's Intellectual Property which could
reasonably be expected to result in a Material Adverse Effect;
(xv) other than as set forth or contemplated in the Registration
Statement and the Prospectus, the discoveries, inventions, products or
processes of the Company referred to in the Registration Statement and
the Prospectus do not, infringe or conflict with any rights of any
third party, or any discovery, invention, product or process which is
the subject of a patent application filed by any third party which
patent application has not been published or is otherwise known to the
Company except to the extent that any such infringement, individually
or in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect;
(xvi) other than as set forth or contemplated in the Registration
Statement and the Prospectus, no third party, including any academic
or governmental organization, possesses rights to the Company's
patents, patent applications or patent rights which, if exercised,
could enable such third party to develop products competitive with
those of the Company or could reasonably be expected to have a
Material Adverse Effect; and
(xvii) In connection with the preparation of the Registration
Statement and the Prospectus, we have participated in conferences with
officers and representatives of the Company, counsel for the
Underwriters and the independent accountants of the Company, at which
conferences we made inquiries of such persons and others and discussed
the contents of the Registration Statement and the Prospectus. While
the limitations inherent in the independent verification of factual
matters and the character of determinations involved in the
registration process are such that we are not passing upon and do not
assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement or the
Prospectus, subject to the foregoing and based on such participation,
inquiries and discussions, no facts have come
20
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to our attention which have caused us to believe that the Registration
Statement, as of the Effective Date (but after giving effect to
changes incorporated pursuant to Rule 430A under the Act), contained
any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to
make the statements therein not misleading (except that we express no
such view with respect to the financial statements, including the
notes and schedules thereto, or any other financial or accounting data
included therein) or that the Prospectus, as of the date of the
Prospectus or as of the date hereof, contained or contains any untrue
statement of a material fact or omitted or omits to state any material
fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading (except
that we express no such view with respect to the financial statements,
including the notes and schedules thereto, or any other financial or
accounting data included therein).
The opinion of Xxxx and Xxxx LLP described above shall be rendered to the
Underwriters at the request of the Company and shall so state therein;
(f) [Buc & Xxxxxxxxx], special FDA counsel for the Company, shall have
furnished to the Representatives their written opinion, dated the Closing Date
or the Additional Closing Date, as the case may be, in form and substance
satisfactory to the Representatives, to the effect that:
(i) at the time the Registration Statement became effective, the
statements in the Registration Statement and the prospectus included
therein set forth under "Risk Factors-- If we fail to obtain FDA approval,
we cannot market Angiomax in the United States," "Risk Factors-- We cannot
expand the indications for Angiomax unless we receive FDA approval for each
additional indication. Failure to expand these indications will limit the
size of the commercial market for Angiomax," "Risk Factors -- If we do not
obtain FDA approvals for our products or comply with government
regulations, we may not be able to market our products and may be subject
to stringent penalties" and "Business-- Government Regulation," insofar as
such statements concern the Federal Food, Drug and Cosmetic Act, the Public
Health Services Act and the Food and Drug Administration Modernization Act
of 1997 and the regulations promulgated thereunder and any similar foreign
statutes and regulations, in each case, did not contain any untrue
21
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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, and that such statements in the captions set forth above in the
Prospectus, as amended or supplemented, if applicable, as of the Closing
Date, do not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
In rendering such opinions, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
the States of New York and Massachusetts and the General Corporation Law of the
State of Delaware, to the extent such counsel deems proper and to the extent
specified in such opinion, if at all, upon an opinion or opinions (in form and
substance reasonably satisfactory to the Underwriters' counsel) of other counsel
reasonably acceptable to the Underwriters' counsel, familiar with the applicable
laws; and (B) as to matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of the Company and certificates or other
written statements of officials of jurisdictions having custody of documents
respecting the corporate existence or good standing of the Company. The opinion
of such counsel for the Company shall state that the opinion of any such other
counsel upon which they relied is in form satisfactory to such counsel and, in
such counsel's opinion, the Underwriters and they are justified in relying
thereon. With respect to the matters to be covered in subparagraph (xi) above,
counsel may state their opinion and belief is based upon their participation in
the preparation of the Registration Statement and the Prospectus and any
amendment or supplement thereto and review and discussion of the contents
thereof but is without independent check or verification except as specified.
The opinion of [Buc & Xxxxxxxxx] described above shall be rendered to the
Underwriters at the request of the Company and shall so state therein;
(g) on the date hereof and the effective date of the most recently filed
post-effective amendment filed on or subsequent to the date hereof to the
Registration Statement and also on the Closing Date or Additional Closing Date,
as the case may
22
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be, Ernst & Young shall have furnished to you letters, dated the respective
dates of delivery thereof, in form and substance satisfactory to you,
containing statements and information of the type customarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained or
incorporated by reference in the Registration Statement and the Prospectus;
(h) the Representatives shall have received on and as of the Closing
Date or Additional Closing Date, as the case may be, an opinion of Xxxxxx
Xxxxxx & Xxxxxxx, counsel to the Underwriters, with respect to the
Registration Statement, the Prospectus and other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(i) the Shares to be delivered on the Closing Date or Additional
Closing Date, as the case may be, shall have been approved for quotation on
the Nasdaq National Market, subject to official notice of issuance;
(j) on or prior to the Closing Date or Additional Closing Date, as the
case may be, the Company shall have furnished to the Representatives such
further certificates and documents as the Representatives shall reasonably
request; and
(k) the "lock-up" agreements, each substantially in the form of
EXHIBIT A hereto, among you and the directors, officers and certain
shareholders of the Company relating to sales and certain other
dispositions of shares of Common Stock or certain other securities,
delivered to you on or before the date hereof, shall be in full force and
effect on the Closing Date or Additional Closing Date, as the case may be.
7. The Company agrees to indemnify and hold harmless each Underwriter, each
affiliate of any Underwriter which assists such Underwriter in the distribution
of Shares and 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 (the "UNDERWRITER ENTITIES"), from and against any and all losses, claims,
damages and liabilities (including, without limitation, the legal fees and other
expenses incurred in connection with any suit, action or proceeding or any claim
asserted) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or 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 untrue statement
or omission or alleged untrue statement or omission made in reliance upon and in
conformity
23
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with information relating to any Underwriter furnished to the Company in writing
by such Underwriter through the Representatives expressly for use therein.
The Company agrees to indemnify and hold harmless the Designated
Underwriter, each person, if any, who controls the Designated Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act and the Underwriter Entities (the "DESIGNATED ENTITIES") 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) (i) caused by any untrue
statement or alleged untrue statement of a material fact contained in any
material prepared by or with the consent of the Company for distribution to
Participants in connection with the Directed Share Program or 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; (ii)
caused by the failure of any Participant to pay for and accept delivery of
Directed Shares that the Participant agreed to purchase; or (iii) related to,
arising out of, or in connection with the Directed Share Program, other than
losses, claims, damages or liabilities (or expenses relating thereto) that are
finally judicially determined to have resulted from the bad faith or gross
negligence of the Designated Entities.
Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and each person who controls the Company within the meaning of Section
15 of the Securities Act and Section 20 of the Exchange Act to the same extent
as the foregoing indemnity from the Company to each 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, the Prospectus, any amendment or supplement thereto,
or any preliminary prospectus.
If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnity may be sought pursuant to the preceding paragraphs
of this Section 7, such person (the "INDEMNIFIED PERSON") shall promptly notify
the person or persons against whom such indemnity may be sought (each, an
"INDEMNIFYING PERSON") in writing. No indemnification shall be available to any
party who shall fall to give notice as provided in this section if the party to
whom notice was not given was unaware of the proceeding to which such notice
would have related and was materially prejudiced by the failure to give such
notice. Such Indemnifying Persons, upon request of the Indemnified Person, shall
retain counsel reasonably satisfactory to the Indemnified Person to represent
the Indemnified Person and any others the Indemnifying Persons may designate in
such proceeding and shall pay the fees and expenses of such counsel related to
such proceeding. In any such proceeding, any Indemnified Person shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
24
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be at the expense of such Indemnified Person and not the Indemnifying Persons
unless (i) the Indemnifying Persons and the Indemnified Person shall have
mutually agreed to the contrary, (ii) the Indemnifying Person has failed within
a reasonable time to retain counsel reasonably satisfactory to the Indemnified
Person or (iii) the named parties in any such proceeding (including any
impleaded parties) include both an Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is
understood that no Indemnifying Person shall, in connection with any proceeding
or related proceeding in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all Indemnified Persons, and that all such fees and expenses shall be reimbursed
within thirty (30) days after request for such reimbursement. Any such separate
firm for the Underwriters, each affiliate of any Underwriter which assists such
Underwriter in the distribution of the Shares and such control persons of
Underwriters shall be designated in writing by X.X. Xxxxxx Securities Inc. and
any such separate firm for the Company, its directors, its officers who sign the
Registration Statement and such control persons of the Company shall be
designated in writing by the Company. Notwithstanding anything contained herein
to the contrary, if indemnity may be sought pursuant to the second paragraph of
this Section 7 in respect of such action or proceeding, then in addition to such
separate firm for the Indemnified Persons, the Indemnifying Person shall be
liable for the reasonable fees and expenses of not more than one separate firm
(in addition to any local counsel) for the Designated Underwriters for the
defense of any losses, claims, damages and liabilities arising out of the
Directed Share Program, and all other persons, if any, who control either of the
Designated Underwriters within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act. No Indemnifying Person shall
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, each Indemnifying Person agrees to indemnify any Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. No Indemnifying Person shall, without the prior written consent of the
Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Person,
unless such settlement includes an unconditional release of such Indemnified
Person from all liability on claims that are the subject matter of such
proceeding.
If the indemnification provided for in the first four paragraphs of this
Section 7 is unavailable to an Indemnified Person or insufficient in respect of
any losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such pro-
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portion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters 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 shall be deemed to be in the same
respective proportions as the net proceeds from the offering (before deducting
expenses) received by the Company and the total underwriting discounts received
by the Underwriters, in each case as set forth in the table on the cover of the
Prospectus, bear to the aggregate public offering price of the Shares. 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 Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purposes) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall an
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Shares underwritten by it and distributed to
the public were offered to the public 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 Underwriters' obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective number of Shares set forth opposite their names in SCHEDULE I hereto,
and not joint.
The remedies provided for in this Section 7 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.
The indemnity and contribution agreements contained in this Section 7 and
the representations and warranties of the Company set forth in this Agreement
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any
26
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investigation made by or on behalf of any Underwriter or any person controlling
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 Shares.
8. Notwithstanding anything herein contained, this Agreement (or the
obligations of the several Underwriters with respect to the Option Shares) may
be terminated in the absolute discretion of the Representatives, by notice given
to the Company, if after the execution and delivery of this Agreement and prior
to the Closing Date (or, in the case of the Option Shares, prior to the
Additional Closing Date) (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the Nasdaq National Market, the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (ii) trading of any securities of or guaranteed by the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either federal or New York State authorities, or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the judgment of the
Representatives, is material and adverse and which, in the judgment of the
Representatives, makes it impracticable to market the Shares being delivered at
the Closing Date or the Additional Closing Date, as the case may be, on the
terms and in the manner contemplated in the Prospectus.
9. This Agreement shall become effective upon the later of (x) execution
and delivery hereof by the parties hereto and (y) release of notification of the
effectiveness of the Registration Statement (or, if applicable, any
post-effective amendment) by the Commission.
If on the Closing Date or the Additional Closing Date, as the case may be,
any one or more of the Underwriters shall fail or refuse to purchase Shares
which it or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of Shares to be purchased on such date, the other Underwriters
shall be obligated severally in the proportions that the number of Shares set
forth opposite their respective names in Schedule I bears to the aggregate
number of Underwritten Shares set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as the Representatives
may specify, to purchase the Shares 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 Shares that any Underwriter has agreed to
purchase pursuant to Section 1 be increased pursuant to this Section 9 by an
amount in excess of one-tenth of such number of Shares without the written
consent of such Underwriter. If on the Closing Date or the Additional Closing
Date, as the case may be, any Underwriter or Underwriters shall fail or refuse
to purchase Shares which it or they have agreed to purchase hereunder on such
date, and the aggregate number of Shares with respect to which such default
occurs is
27
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more than one-tenth of the aggregate number of Shares to be purchased on such
date, and arrangements satisfactory to the Representatives for the purchase of
such Shares are not made within 36 hours after such default, this Agreement (or
the obligations of the several Underwriters to purchase the Option Shares, as
the case may be) shall terminate without liability on the part of any
non-defaulting Underwriter. In any such case the Representatives shall have the
right to postpone the Closing Date (or, in the case of the Option Shares, the
Additional Closing Date), but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and 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.
10. 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 material 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 or any condition of the Underwriters' obligations cannot be
fulfilled, the Company agrees to reimburse the Underwriters or such Underwriters
as have so terminated this Agreement with respect to themselves, severally, for
all out-of-pocket expenses (including the fees and expenses of its counsel)
reasonably incurred by the Underwriter in connection with this Agreement or the
offering contemplated herein.
11. This Agreement shall inure to the benefit of and be binding upon the
Company, the Underwriters, any controlling persons referred to herein and their
respective successors and assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person, firm or
corporation any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision herein contained. No purchaser of Shares from
any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
12. Any action by the Underwriters hereunder may be taken by the
Representatives jointly or by X.X. Xxxxxx Securities Inc. alone on behalf of the
Underwriters, and any such action taken by the Representatives jointly or by
X.X. Xxxxxx Securities Inc. alone shall be binding upon the Underwriters. All
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be given to the
Representatives, c/o X.X. Xxxxxx Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (telefax: (212-648-5705), Attention: Syndicate Department, copy to
Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (telefax:
212-269-5420), Attention: Xxxxxx X. Xxxxxxxxx, Esq. Notices to the Company shall
be given to it at its office, Xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx
00000 (telefax: 617-225-2397), Attention: Xxxxxx Xxxxxxxx.
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Copies of notices to the Company should be given to Xxxx and Xxxx LLP, 00 Xxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (telefax: 617-526-5000), Attention: Xxxxxx
X. Xxxxxx, Esq.
13. This Agreement may be signed in counterparts, each of which shall be an
original and all of which together shall constitute one and the same instrument.
14. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF
LAWS PROVISIONS THEREOF.
29
If the foregoing is in accordance with your understanding, please sign and
return five counterparts hereof.
Very truly yours,
THE MEDICINES COMPANY
By:
----------------------------------
Name:
Title:
30
Accepted: [ ], 2000
X.X. XXXXXX SECURITIES INC.
FLEETBOSTON XXXXXXXXX XXXXXXXX INC.
CIBC WORLD MARKETS CORP.
Acting severally on behalf of themselves
and the several Underwriters listed
in Schedule I hereto.
By: X.X. XXXXXX SECURITIES INC.
By:
-------------------------------------------
Name:
Title:
31
SCHEDULE I
NUMBER OF
UNDERWRITTEN
SHARES TO BE
UNDERWRITER PURCHASED
----------- ------------
X.X. Xxxxxx Securities Inc...................................
FleetBoston Xxxxxxxxx Xxxxxxxx Inc...........................
CIBC World Markets Corp......................................
Total......................................
============
32
Exhibit A
[Form of Lock-Up Agreement]
