Exhibit 1.1
CUBIST PHARMACEUTICALS, INC.
__% CONVERTIBLE SUBORDINATED NOTES DUE 2013
----------
UNDERWRITING AGREEMENT
May __, 2006
Xxxxxxx, Xxxxx & Co.,
[Name(s) of Co Representative(s)]
[As representatives of the several Underwriters
named in Schedule I hereto,]
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
Cubist Pharmaceuticals, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") an aggregate
of $_______ principal amount of the __% Convertible Subordinated Notes Due 2013,
convertible into common stock, $.001 par value ("Stock") of the Company,
specified above (the "Firm Securities") and, at the election of the
Underwriters, up to an aggregate of $_____ additional aggregate principal amount
(the "Optional Securities") (the Firm Securities and the Optional Securities
that the Underwriters elect to purchase pursuant to Section 2 hereof are herein
collectively called the "Securities").
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) An "automatic shelf registration statement" as defined under Rule
405 under the Securities Act of 1933, as amended (the "Act"), on Form S-3
(File No. 333-_____) in respect of the Firm Securities and Optional
Securities and shares of Stock issuable upon conversion thereof has been
filed with the Securities and Exchange Commission (the "Commission") not
earlier than three years prior to the date hereof; such registration
statement, and any post-effective amendment thereto, became effective on
filing; and no stop order suspending the effectiveness of such registration
statement or any part thereof has been issued and no proceeding for that
purpose has been initiated or threatened by the
1
Commission, and no notice of objection of the Commission to the use of such
registration statement or any post-effective amendment thereto pursuant to
Rule 401(g)(2) under the Act has been received by the Company (the base
prospectus filed as part of such registration statement, in the form in
which it has most recently been filed with the Commission on or prior to
the date of this Agreement, is hereinafter called the "Basic Prospectus";
any preliminary prospectus (including any preliminary prospectus
supplement) relating to the Securities filed with the Commission pursuant
to Rule 424(b) under the Act is hereinafter called a "Preliminary
Prospectus"; the various parts of such registration statement, including
all exhibits thereto but excluding Form T-1 and including any prospectus
supplement relating to the Securities that is filed with the Commission and
deemed by virtue of Rule 430B to be part of such registration statement,
each as amended at the time such part of the registration statement became
effective, are hereinafter collectively called the "Registration
Statement"; the Basic Prospectus, as amended and supplemented immediately
prior to the Applicable Time (as defined in Section 1(c) hereof), is
hereinafter called the "Pricing Prospectus"; the form of the final
prospectus relating to the Securities filed with the Commission pursuant to
Rule 424(b) under the Act in accordance with Section 5(a) hereof is
hereinafter called the "Prospectus"; any reference herein to the Basic
Prospectus, the Pricing Prospectus, 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
Act, as of the date of such prospectus; any reference to any amendment or
supplement to the Basic Prospectus, any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any post-effective
amendment to the Registration Statement, any prospectus supplement relating
to the Securities filed with the Commission pursuant to Rule 424(b) under
the Act and any documents filed under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and incorporated therein, in each case
after the date of the Basic Prospectus, such Preliminary Prospectus, or the
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement 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 Registration Statement that is
incorporated by reference in the Registration Statement; and any "issuer
free writing prospectus" as defined in Rule 433 under the Act relating to
the Securities is hereinafter called an "Issuer Free Writing Prospectus");
(b) No order preventing or suspending the use of any Preliminary
Prospectus or any Issuer Free Writing Prospectus has been issued by the
Commission, and each Preliminary Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of
-2-
the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the rules and regulations of the Commission thereunder,
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, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by an Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein;
(c) For the purposes of this Agreement, the "Applicable Time" is
[TIME OF PRICING] (Eastern time) on the date of this Agreement; the Pricing
Prospectus as supplemented by the final term sheet prepared and filed
pursuant to Section 5(a) hereof, taken together (collectively, the "Pricing
Disclosure Package") as of the Applicable Time, did not include any 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
under which they were made, not misleading; and each Issuer Free Writing
Prospectus listed on Schedule II(a) hereto does not conflict with the
information contained in the Registration Statement, the Pricing Prospectus
or the Prospectus and each such Issuer Free Writing Prospectus, as
supplemented by and taken together with the Pricing Disclosure Package as
of the Applicable Time, did not include any 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 under which they were
made, not misleading; provided, however, that this representation and
warranty shall not apply to statements or omissions made in an Issuer Free
Writing Prospectus in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein;
(d) The documents incorporated by reference in the Pricing Prospectus
and 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 Act or the Exchange Act, as applicable, and the rules
and regulations of the Commission thereunder, and none of such documents
contained an 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; any further documents so filed and
incorporated by reference in the Prospectus or any further amendment or
supplement thereto, when such documents become effective or are filed with
the Commission, as the case may be, will conform in all material respects
to the requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the
-3-
Commission thereunder and will 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 not misleading;
provided, however, that this representation and warranty shall not apply to
any statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein; and no such documents were
filed with the Commission since the Commission's close of business on the
business day immediately prior to the date of this Agreement and prior to
the execution of this Agreement, except as set forth on Schedule II(b)
hereto;
(e) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement and the
Prospectus will conform, in all material respects to the requirements of
the Act and the Trust Indenture Act and the rules and regulations of the
Commission thereunder and do not and will not, as of the applicable
effective date as to each part of the Registration Statement and as of the
applicable filing date as to the Prospectus and any amendment or supplement
thereto, 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 not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through Xxxxxxx, Sachs & Co.
expressly for use therein;
(f) 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 Pricing 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 Pricing Prospectus; and, since the respective dates
as of which information is given in the Registration Statement and the
Pricing Prospectus, there has not been any change in the capital stock 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 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 Pricing Prospectus;
(g) The Company and its subsidiaries have good and marketable title
in fee simple to all real property and good and marketable
-4-
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 in the
Pricing Prospectus or such as do not materially affect the value of such
property and do not interfere with the use made and proposed to be made of
such property by the Company and its subsidiaries; and any real property
and buildings held under lease by the Company and its subsidiaries are held
by them under valid, subsisting and enforceable leases with such exceptions
as are not material and do not interfere with the use made and proposed to
be made of such property and buildings by the Company and its subsidiaries;
(h) 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 Pricing 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, except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole (a "Company Material Adverse
Effect"); and each subsidiary of the Company has been duly incorporated and
is validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, except to the extent that the failure to be
in good standing would not have a Company Material Adverse Effect;
(i) The Company has an authorized capitalization as set forth in the
Pricing Prospectus and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully paid
and non-assessable; the shares of Stock initially issuable upon conversion
of the Securities have been duly and validly authorized and reserved for
issuance and, when issued and delivered in accordance with the provisions
of the Securities and the Indenture referred to below, will be duly and
validly issued, fully paid and non-assessable and will conform to the
description of the Stock contained in the Pricing Disclosure Package and
the Prospectus; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable, and are owned directly or indirectly by
the Company, free and clear of all liens, encumbrances, equities or claims;
(j) The Firm Securities and Optional Securities have been duly
authorized and, when issued and delivered pursuant to this Agreement, will
have been duly executed, authenticated, issued and delivered and will
-5-
constitute valid and legally binding obligations of the Company entitled to
the benefits provided by the indenture dated as of ________ __, 2006 (the
"Indenture") between the Company and The Bank of New York as Trustee (the
"Trustee"), under which they are to be issued, which is substantially in
the form filed as an exhibit to the Registration Statement; the Indenture
has been duly authorized and duly qualified under the Trust Indenture Act
and, when executed and delivered by the Company and the Trustee, will
constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating
to or affecting creditors' rights and to general equity principles; and the
Securities and the Indenture will conform to the descriptions thereof in
the Pricing Disclosure Package and the Prospectus;
(k) (1) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities, the Indenture and
this Agreement and the consummation of the transactions herein and therein
contemplated (i) 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 to which any of
the property or assets of the Company or any of its subsidiaries is
subject, that is material to the Company and its subsidiaries, taken as a
whole, (ii) nor will such action result in any violation of the provisions
(A) of the Certificate of Incorporation or By-laws of the Company or (B)
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; and (2) no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale of
the Securities or the consummation by the Company of the transactions
contemplated by this Agreement or the Indenture except such as have been
obtained under the Act and the Trust Indenture Act, and such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters, except
with respect to clauses 1(i), 1(ii)(B) and (2) for any contraventions,
violations or consents that would not, singly or in the aggregate, have a
Company Material Adverse Effect;
(l) Neither the Company nor any of its subsidiaries is in violation
of its Certificate of Incorporation or By-laws or in default in the
performance or observance of any material obligation, covenant or condition
contained in any indenture, mortgage, deed of trust, loan
-6-
agreement, lease or other agreement or instrument to which it is a party or
by which it or any of its properties may be bound;
(m) The statements set forth in the Pricing Prospectus and the
Prospectus under the caption "Description of Notes" and "Description of
Capital Stock", insofar as they purport to constitute a summary of the
terms of the Securities and the Stock, under the caption "Certain U.S.
Federal Tax Considerations", insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate,
complete and fair;
(n) Other than as set forth in the Pricing Prospectus, there are no
legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or any
of its subsidiaries is the subject that are required to be described in the
Pricing Prospectus; and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(o) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof, will
not be an "investment company", as such term is defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(p) (A) (i) At the time of filing the Registration Statement, (ii) at
the time of the most recent amendment thereto for the purposes of complying
with Section 10(a)(3) of the Act (whether such amendment was by
post-effective amendment, incorporated report filed pursuant to Section 13
or 15(d) of the Exchange Act or form of prospectus), and (iii) at the time
the Company or any person acting on its behalf (within the meaning, for
this clause only, of Rule 163(c) under the Act) made any offer relating to
the Securities in reliance on the exemption of Rule 163 under the Act, the
Company was a "well-known seasoned issuer" as defined in Rule 405 under the
Act; and (B) at the earliest time after the filing of the Registration
Statement that the Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) under the Act) of the
Securities, the Company was not an "ineligible issuer" as defined in Rule
405 under the Act;
(q) PricewaterhouseCoopers LLP, an independent registered public
accounting firm with respect to the Company within the meaning of the Act
and the applicable rules and regulations thereunder adopted by the
Securities and Exchange Commission and the Public Company Accounting
Oversight Board, who have certified certain financial statements of the
Company and its subsidiaries, and have audited the
-7-
Company's internal control over financial reporting and management's
assessment thereof, are independent public accountants as required by the
Act and the rules and regulations of the Commission thereunder;
(r) The Company maintains a system of internal control over financial
reporting (as such term is defined in Rule 13a-15(f) under the Exchange
Act) that complies in all material respects with the requirements of the
Exchange Act and has been designed by the Company's principal executive
officer and principal financial officer, or under their supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes
in accordance with generally accepted accounting principles. The Company's
internal control over financial reporting is effective, and the Company is
not aware of any material weaknesses in its internal control over financial
reporting;
(s) Since the date of the latest audited financial statements
included or incorporated by reference in the Pricing Prospectus, there has
been no change in the Company's internal control over financial reporting
that has materially affected, or is reasonably likely to materially affect,
the Company's internal control over financial reporting;
(t) The Company maintains disclosure controls and procedures (as such
term is defined in Rule 13a-15(e) under the Exchange Act) that comply in
all material respects with the applicable requirements of the Exchange Act;
such disclosure controls and procedures have been designed to ensure that
material information relating to the Company and its subsidiaries is made
known to the Company's principal executive officer and principal financial
officer by others within those entities; and such disclosure controls and
procedures are effective;
(u) The information contained in the Pricing Prospectus concerning
the issued patents and pending patent applications, owned by or licensed to
the Company or any of its subsidiaries, which are material to the conduct
of the business of the Company and its subsidiaries, taken as a whole, in
the manner in which it has been and is contemplated to be conducted as
described in the Pricing Prospectus (the "Patent Rights"), is accurate in
all material respects. The Company and its subsidiaries own or have valid,
binding and enforceable licenses or other rights to use any patents,
trademarks, trade names, service marks, service names, copyrights,
confidential and proprietary information, including trade secrets,
know-how, inventions and technology, whether patented or not, proprietary
computer software and other intellectual property rights (collectively, the
"Intellectual Property") necessary to conduct the business of the Company
and its subsidiaries, taken as a whole, in the manner in
-8-
which it has been and is contemplated to be conducted, as described in each
of the Pricing Prospectus, and without any conflict with the rights of
others, except as described in the Pricing Prospectus and except for such
conflicts which, if determined adversely to the Company or any of its
subsidiaries, would not have, singly or in the aggregate, a Company
Material Adverse Effect. Neither the Company nor any of its subsidiaries
has knowledge that, or has received any notice from any other person
alleging that, the business of the Company or any of its subsidiaries in
the manner in which it has been and is contemplated to be conducted, as
described in each of the Pricing Prospectus, conflicts with the
Intellectual Property rights of others, except for such conflicts which, if
determined adversely to the Company or any of its subsidiaries, would not
have, singly or in the aggregate, a Company Material Adverse Effect;
(v) All patent applications in the Patent Rights have been duly and
properly filed or caused to be filed with the United States Patent and
Trademark Office (the "PTO") and, in some cases, applicable foreign and
international patent authorities, and assignments for all patents and/or
patent applications in the Patent Rights have been properly executed and
recorded for each named inventor. To the knowledge of the Company, all
printed publications and patent references material to the patentability of
the inventions claimed in the Patent Rights have been disclosed to those
patent offices so requiring. To the knowledge of the Company, each of the
Company, its assignors or its licensors, as applicable, has met its duty of
candor and good faith to the PTO for the Patent Rights. To the knowledge of
the Company, no material misrepresentation has been made to any patent
office in connection with the Patent Rights. The Company and its
subsidiaries are not aware or any facts material to a determination of
patentability regarding the Patent Rights not disclosed to the PTO or other
applicable patent office. The Company and its subsidiaries are not aware of
any facts not disclosed to the PTO or other applicable patent office that
would preclude the patentability, validity or enforceability of any patent
or patent application in the Patent Rights. The Company has no knowledge of
any facts that would preclude the Company or its licensor, as applicable,
from having clear title to the patents and patent applications in the
Patent Rights. To the Company's knowledge, the patents in the Patent Rights
are valid and enforceable, and have not been adjudged invalid or
unenforceable in whole or in part;
(w) To the knowledge of the Company, no third party is engaging in
any activity that infringes, misappropriates or otherwise violates the
Intellectual Property owned by or licensed to the Company or any of its
subsidiaries, except as described in the Pricing Prospectus or except for
such activities which, singly or in the aggregate, would not have a Company
Material Adverse Effect;
-9-
(x) With respect to each material agreement governing rights in and
to any Intellectual Property licensed by or licensed to the Company or any
of its subsidiaries, (i) such agreement is valid and binding and in full
force and effect against the Company or the subsidiary of the Company that
is party to such material agreement, and, to the knowledge of the Company,
each other party thereto; (ii) none of the Company or its subsidiaries has
received any notice of termination or cancellation under such agreement,
which notice of termination or cancellation has not been withdrawn,
received any notice of breach or default under such agreement, which breach
has not been cured, or granted to any third party any rights, adverse or
otherwise, under such agreement that would constitute a material breach of
such agreement; and (iii) none of the Company, any of its subsidiaries or,
to Company's knowledge, any other party to such agreement, is in breach or
default thereof in any material respect, and no event has occurred that,
with notice or lapse of time, would constitute such a material breach or
default or permit termination, modification or acceleration under such
agreement;
(y) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses, including without limitation all such certificates,
authorizations and permits required by the United States Food and Drug
Administration (the "FDA") or any other federal, state or foreign agencies
or bodies engaged in the regulation of pharmaceuticals or biohazardous
materials, except where the failure to so possess such certificates,
authorizations and permits, singly or in the aggregate, would not have a
Company Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such certificate, authorization or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a Company Material Adverse Effect;
(z) The studies, tests and preclinical and clinical trials, conducted
by or on behalf of the Company that are described in the Pricing Prospectus
or 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 each of the Pricing Prospectus and the Prospectus are
accurate in all material respects; and neither the Company nor any of its
subsidiaries has 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
-10-
preclinical or clinical trials conducted by or on behalf of the Company
which termination, suspension or material modification would have a Company
Material Adverse Effect; and
(aa) The statistical and market-related data contained in the Pricing
Prospectus and the Prospectus are based on or derived from sources that the
Company reasonably and in good faith believes are reliable and accurate,
and such data agree with the sources from which they are derived.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price of ____% of the principal amount thereof, the principal amount
of Securities set forth opposite the name of such Underwriter in Schedule I
hereto, and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Securities as provided below, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
the same purchase price set forth in clause (a) of this Section 2, that portion
of the aggregate principal amount of the Optional Securities as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractions of $______) determined by multiplying such aggregate principal amount
of Optional Securities by a fraction, the numerator of which is the maximum
aggregate principal amount of Optional Securities that 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 aggregate
principal amount of Optional Securities which all of the Underwriters are
entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to $_____ aggregate principal amount of Optional Securities,
at the same purchase price set forth in clause (a) of the first paragraph of
this Section 2, for the sole purpose of covering sales of securities in excess
of the aggregate principal amount of Firm Securities. Any such election to
purchase Optional Securities may be exercised by written notice from you to the
Company, given within a period of 30 calendar days after the date of this
Agreement, setting forth the aggregate principal amount of Optional Securities
to be purchased and the date on which such Optional Securities are to be
delivered, as determined by you but in no event earlier than the First Time of
Delivery (as defined in Section (4) hereof) or, unless you and the Company
otherwise agree in writing, earlier than two or later than ten business days
after the date of such notice.
-11-
3. Upon the authorization by you of the release of the Firm Securities,
the several Underwriters propose to offer the Firm Securities for sale upon the
terms and conditions set forth in the Prospectus.
4.
(a) The Securities to be purchased by each Underwriter hereunder will be
represented by one or more definitive global Securities in book-entry form which
will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The time and date of such delivery
and payment shall be, with respect to the Firm Securities, 9:30 a.m., New York
City time, on June __, 2006, or at such other time and date as you and the
Company may agree upon in writing, and, with respect to the Optional Securities,
9:30 a.m., New York City time, on the date specified by you in the written
notice given by you of the Underwriters' election to purchase the Optional
Securities, or at such other time and date as you and the Company may agree upon
in writing. Such time and date for delivery of the Firm Securities is herein
called the "First Time of Delivery", such time and date for delivery of the
Optional Securities, if not the First Time of Delivery, is herein called the
"Second Time of Delivery", and each such time and date for delivery is herein
called a "Time of Delivery". The Company will deliver the Securities to Xxxxxxx,
Xxxxx & Co., for the account of each Underwriter, against payment by or on
behalf of such Underwriter of the purchase price therefor by wire transfer of
Federal (same-day) funds to the account specified by the Company to Xxxxxxx,
Sachs & Co. at least 48 hours in advance, by causing DTC to credit the
Securities to the account of Xxxxxxx, Xxxxx & Co. at DTC. The Company will cause
the certificates representing the Securities to be made available to Xxxxxxx,
Sachs & Co. for checking at least 24 hours prior to the Time of Delivery (as
defined below) at the office of DTC or its designated custodian (the "Designated
Office").
(b) The documents to be delivered at the Time of Delivery by or on behalf
of the parties hereto pursuant to Section 8 hereof, including the cross-receipt
for the Securities and any additional documents requested by the Underwriters
pursuant to Section 8(m) hereof, will be delivered at the offices of Xxxxxxx
XxXxxxxxx LLP, Boston, Massachusetts (the "Closing Location"), and the
Securities will be delivered at the Designated Office, all at the Time of
Delivery. A meeting will be held at the Closing Location at 3:00 p.m., New York
City time, on the New York Business Day next preceding the Time of Delivery, at
which meeting the final drafts of the documents to be delivered pursuant to the
preceding sentence will be available for review by the parties hereto. For the
purposes of this Section 4, "New York Business Day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in New York City are generally authorized or obligated by law or
executive order to close.
5. The Company agrees with each of the Underwriters:
-12-
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the date of this
Agreement; to make no further amendment or any supplement to the Registration
Statement, the Basic Prospectus or the Prospectus prior to such Time of Delivery
which shall be disapproved by you promptly after reasonable notice thereof; to
advise you, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective or
any amendment or supplement to the Prospectus has been filed and to furnish you
with copies thereof; to prepare a final term sheet, containing solely a
description of the Securities, in a form approved by you and to file such term
sheet pursuant to Rule 433(d) under the Act within the time required by such
Rule; to file promptly all other material required to be filed by the Company
with the Commission pursuant to Rule 433(d) under the Act; to 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 (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is required in connection with the offering or sale of the
Securities; to advise you, 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 other prospectus in respect
of the Securities, of any notice of objection of the Commission to the use of
the Registration Statement or any post-effective amendment thereto pursuant to
Rule 401(g)(2) under the Act, of the suspension of the qualification of the
Securities or the shares of Stock issuable upon conversion of the Securities 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 Statement 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
other prospectus or suspending any such qualification, to promptly use its
commercially reasonable best efforts to obtain the withdrawal of such order; and
in the event of any such issuance of a notice of objection, promptly to take
such steps including, without limitation, amending the Registration Statement or
filing a new registration statement, at its own expense, as may be necessary to
permit offers and sales of the Securities by the Underwriters (references herein
to the Registration Statement shall include any such amendment or new
registration statement);
(b) If required by Rule 430B(h) under the Act, to prepare a form of
prospectus in a form approved by you and to file such form of prospectus
pursuant to Rule 424(b) under the Act not later than may be required by Rule
424(b) under the Act; and to make no further amendment or supplement to such
-13-
form of prospectus which shall be disapproved by you promptly after reasonable
notice thereof;
(c) Promptly from time to time to take such action as you may reasonably
request to qualify the Securities and the shares of Stock issuable upon
conversion of the Securities for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of the Securities,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(d) Prior to 10:00 a.m., New York City time, on the New York Business Day
next succeeding the date of this Agreement and from time to time, to furnish the
Underwriters with written and electronic copies of the Prospectus in New York
City in such quantities as you may reasonably request, and, if the delivery of a
prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the
Act) is required at any time prior to the expiration of nine months after the
time of issue of the Prospectus in connection with the offering or sale of the
Securities and the shares of Stock issuable upon conversion of the Securities
and if at such time any event shall have occurred 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 under which they were
made when such Prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the Exchange Act or
the Trust Indenture Act, to notify you and upon your request to file such
document and to prepare and furnish without charge to each Underwriter and to
any dealer in securities as many written and electronic copies as you may from
time to time reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance; and in case any Underwriter is required to deliver a prospectus (or
in lieu thereof, the notice referred to in Rule 173(a) under the Act) in
connection with sales of any of the Securities and the shares of Stock issuable
upon conversion of the Securities at any time nine months or more after the time
of issue of the Prospectus, upon your request, but at the expense of such
Underwriter, to prepare and deliver to such Underwriter as many written and
electronic copies as you may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act;
-14-
(e) To make generally available to its securityholders as soon as
practicable, but in any event not later than sixteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule
158);
(f) During the period beginning from the date hereof and continuing to and
including the date 90 days after the date of the Prospectus, not to offer, sell,
contract to sell, pledge, grant any option to purchase, make any short sale or
otherwise dispose, except as provided hereunder, of any securities of the
Company that are substantially similar to the Securities or the Stock, including
but not limited to any options or warrants to purchase shares of Stock or any
securities that are convertible into or exchangeable for, or that represent the
right to receive, Stock or any such substantially similar securities without the
consent of Xxxxxxx, Xxxxx & Co. (other than (1) the issuance by the Company of
shares of Stock upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof that is disclosed in the Prospectus or
of which the Underwriters have been advised in writing, (2) the grant by the
Company of options to purchase shares of Stock pursuant to the terms of a plan
in effect on the date hereof and filed as an exhibit to the Registration
Statement or any filing incorporated by reference therein, (3) the issuance by
the Company of shares of Stock pursuant to the Company's Amended and Restated
1997 Employee Stock Purcahse Plan and the Company's 401(k) Plan matching
contribution program, or (4) the issuance of up to 1,000,000 shares of Stock
pursuant to collaborative, licensing or marketing agreements; provided that,
with respect to clause (4), prior to the issuance of any such shares of Stock,
the Company shall cause the recipient of such shares to execute and deliver to
you a form of "lock-up" agreement substantially in the form of Exhibit I
attached hereto.);
(g) To pay the required Commission filing fees relating to the Securities
within the time required by Rule 456(b)(1) under the Act without regard to the
proviso therein and otherwise in accordance with Rules 456(b) and 457(r) under
the Act;
(h) To use the net proceeds received by it from the sale of the Securities
pursuant to this Agreement in the manner specified in the Pricing Prospectus
under the caption "Use of Proceeds";
(j) To reserve and keep available at all times, free of preemptive rights,
shares of Stock for the purpose of enabling the Company to satisfy any
obligation to issue shares of its Stock upon conversion of the Securities; and
(k) To use its commercially reasonable best efforts to list for quotation
the shares of Stock issuable upon conversion of the Securities on the Nasdaq
Stock Market Inc.'s National Market ("NASDAQ").
-15-
6.
(a) (i) The Company represents and agrees that, other than the final
term sheet prepared and filed pursuant to Section 5(a) hereof, without the prior
consent of Xxxxxxx, Xxxxx & Co., it has not made and will not make any offer
relating to the Securities that would constitute a "free writing prospectus" as
defined in Rule 405 under the Act;
(ii) each Underwriter represents and agrees that, without the prior
consent of the Company and Xxxxxxx, Sachs & Co., other than one or more term
sheets relating to the Securities containing customary information (which, in
their final form, will not be inconsistent with the final term sheet) and
conveyed to purchasers of Securities, it has not made and will not make any
offer relating to the Securities that would constitute a free writing
prospectus; and
(iii) any such free writing prospectus the use of which has been
consented to by the Company and Xxxxxxx, Xxxxx & Co. (including the final term
sheet prepared and filed pursuant to Section 5(a) hereof) is listed on Schedule
II(a) hereto;
(b) The Company has complied and will comply with the requirements of Rule
433 under the Act applicable to any Issuer Free Writing Prospectus, including
timely filing with the Commission or retention where required and legending; and
(c) The Company agrees that if at any time following issuance of an Issuer
Free Writing Prospectus any event occurred or occurs as a result of which such
Issuer Free Writing Prospectus would conflict with the information in the
Registration Statement, the Pricing Prospectus or the Prospectus or 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 then prevailing, not misleading, the Company will give prompt
notice thereof to Xxxxxxx, Sachs & Co. and, if requested by Xxxxxxx, Xxxxx &
Co., will prepare and furnish without charge to each Underwriter an Issuer Free
Writing Prospectus or other document which will correct such conflict, statement
or omission; provided, however, that this representation and warranty shall not
apply to any statements or omissions in an Issuer Free Writing Prospectus made
in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein.
7. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities and the shares of Stock
issuable upon conversion of the Securities under the Act and all other expenses
in
-16-
connection with the preparation, printing, reproduction and filing of the
Registration Statement, the Basic Prospectus, any Preliminary Prospectus, any
Issuer Free Writing Prospectus and the Prospectus and amendments and supplements
thereto and the mailing and delivering of copies thereof to the Underwriters and
dealers; (ii) the cost of printing or producing any Agreement among
Underwriters, this Agreement, the Indenture, the Blue Sky memorandum, closing
documents (including any compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Securities;
(iii) all expenses in connection with the qualification of the Securities and
the shares of Stock issuable upon conversion of the Securities for offering and
sale under state securities laws as provided in Section 5(c) hereof, including
the fees and disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky survey; (iv) any fees
charged by securities rating services for rating the Securities; (v) the filing
fees incident to, and the fees and disbursements of counsel for the Underwriters
in connection with, any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Securities; (vi) all
fees and expenses in connection with listing the shares of Stock issuable upon
conversion of the Securities on NASDAQ; (vii) the cost of preparing the
Securities; (viii) the fees and expenses of the Trustee and any agent of the
Trustee and the fees and disbursements of counsel for the Trustee in connection
with the Indenture and the Securities; and (ix) all other costs and expenses
incident to the performance of its obligations hereunder that are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 9 and 12 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make.
8. The obligations of the Underwriters hereunder, as to the Securities to
be delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company herein are, at and as of such Time of Delivery, true and correct,
the condition that the Company shall have performed all of its obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) under the Act within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof; the final term sheet contemplated by Section 5(a) hereof, and any
other material required to be filed by the Company pursuant to Rule 433(d) under
the Act, shall have been filed with the Commission within the applicable time
periods prescribed for such filings by Rule 433; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have
-17-
been initiated or threatened by the Commission and no notice of objection of the
Commission to the use of the Registration Statement or any post-effective
amendment thereto pursuant to Rule 401(g)(2) under the Act shall have been
received; no stop order suspending or preventing the use of the Prospectus or
any Issuer Free Writing Prospectus shall have been initiated or threatened by
the Commission; and all requests for additional information on the part of the
Commission shall have been complied with to your reasonable satisfaction;
(b) Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, counsel for the
Underwriters, shall have furnished to you their written opinion, dated such
Time of Delivery, in form and substance satisfactory to you, covering the
matters referred to in paragraphs (1), (5), (7) and (9) (but only as to the
statements in the Prospectus under ("Description of Notes," "Description of
Capital Stock" and "Underwriting"), and the final two paragraphs, of the
opinion of counsel for the Company set forth in Exhibit II(b) hereto;
(c) Xxxxxxx XxXxxxxxx LLP, counsel for the Company, shall have furnished
to you their written opinion, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect set forth in Annex II(b) attached hereto;
(d) Xxxxxxxxxxx X.X. Xxxxxxx, General Counsel of the Company, shall have
furnished to you, a written opinion, dated such Time of Delivery, in form and
substance satisfactory to you, to the effect set forth in Exhibit II(c) attached
hereto;
(e) Fish & Xxxxxxxxxx P.C., special patent counsel for the Company, shall
have furnished to you, their written opinion, dated such Time of Delivery, in
form and substance satisfactory to you, to the effect set forth in Exhibit II(d)
attached hereto;
(f) Xxxxx & Xxxxxxx L.L.P., regulatory counsel for the Company, shall have
furnished to you, their written opinion, dated such Time of Delivery, in form
and substance satisfactory to you, to the effect set forth in Exhibit II(e)
attached hereto;
(g) On the date of the Prospectus at a time prior to the execution of this
Agreement at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, PricewaterhouseCoopers
LLP shall have furnished to you a letter or letters, dated the respective dates
of delivery thereof, in form and substance satisfactory to you and
PricewaterhouseCoopers LLP, to the effect set forth in Annex I hereto (the
executed copy of the letter delivered prior to the execution of this Agreement
is attached as Annex I(a) hereto and a form of letter to be delivered on the
effective
-18-
date of any post-effective amendment to the Registration Statement, and as of
each Time of Delivery is attached as Annex I(b) hereto);
(h) (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 Pricing 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 Pricing
Prospectus, and (ii) since the respective dates as of which information is given
in the Pricing Prospectus there shall not have been any change in the capital
stock 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 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 Pricing Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in your judgment so material and adverse as
to make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities being issued at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus;
(i) On or after the Applicable Time (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) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities;
(j) On or after the Applicable Time there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in securities
generally on the NASDAQ; (ii) a suspension or material limitation in trading in
the Company's securities on NASDAQ; (iii) a general moratorium on commercial
banking activities declared by Federal authorities, State of New York
authorities, or Commonwealth of Massachusetts authorities or a material
disruption in commercial banking or securities settlement or clearance services
in the United States; (iv) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war; or (v) the occurrence of any other calamity or crisis or any
change in financial, political or economic conditions in the United States or
elsewhere, if the effect of any such event specified in clause (iv) or (v) in
your judgment makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Securities being issued at such Time of Delivery
on the terms and in the manner contemplated in the Prospectus;
-19-
(k) The Company shall have complied with the provisions of Section 5(d)
hereof with respect to the furnishing of prospectuses on the New York Business
Day next succeeding the date of this Agreement;
(l) The shares of Stock issuable upon conversion of the Securities shall
have been duly listed for quotation on NASDAQ; and
(m) The Company shall have furnished or caused to be furnished to you at
such Time of Delivery certificates of officers of the Company satisfactory to
you as to the accuracy of the representations and warranties of the Company
herein at and as of such time, as to the performance by the Company of all of
its obligations hereunder to be performed at or prior to such time, as to the
matters set forth in subsections (a) and (h) of this Section and as to such
other matters as you may reasonably request.
9. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, the Basic Prospectus, any
Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any
amendment or supplement thereto, any Issuer Free Writing Prospectus or any
"issuer information" filed or required to be filed pursuant to Rule 433(d) under
the Act, or arise out of or are based upon 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, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim 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 or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in the Registration Statement, the Basic
Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the
Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing
Prospectus, in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through Xxxxxxx, Sachs & Co.
expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, the Basic Prospectus, any Preliminary
-20-
Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or
supplement thereto, or any Issuer Free Writing Prospectus, or arise out of or
are based upon 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, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in the Registration Statement, the Basic Prospectus, any Preliminary Prospectus,
the Pricing Prospectus or the Prospectus or any such amendment or supplement
thereto, or any Issuer Free Writing Prospectus, in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through Xxxxxxx, Xxxxx & Co. expressly for use therein; and will reimburse the
Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such action or claim as such
expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
any indemnified party
(d) If the indemnification provided for in this Section 9 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b)
-21-
above in respect of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is 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 Securities. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (c) above,
then each indemnifying party shall contribute to such amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions 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 shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters, in each case as set forth in the table on the cover page of
the Prospectus. 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 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 subsection (d) were determined by pro rata allocation (even if
the Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include 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 subsection (d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which 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 Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this subsection
(d) to contribute are several in proportion to their respective underwriting
obligations and not joint.
-22-
(e) The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act and each broker-dealer affiliate of
any Underwriter; and the obligations of the Underwriters under this Section 9
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company and to each person, if any, who controls the
Company within the meaning of the Act.
10. (a) If any Underwriter shall default in its obligation to purchase
the Securities which it has agreed to purchase hereunder, you may in your
discretion arrange for you or another party or other parties to purchase such
Securities on the terms contained herein at a Time of Delivery. If within 36
hours after such default by any Underwriter, you do not arrange for the purchase
of such Securities, then the Company shall be entitled to a further period of 36
hours within which to procure another party or other parties satisfactory to you
to purchase such Securities on such terms. In the event that, within the
respective prescribed periods, you notify the Company that you have so arranged
for the purchase of such Securities, or the Company notifies you that it has so
arranged for the purchase of such Securities, you or the Company shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to 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 to file promptly any amendments or
supplements to the Registration Statement or the Prospectus which in your
opinion may thereby be made necessary. The term "Underwriter" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Securities.
(a) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate principal amount of such
Securities which remains unpurchased does not exceed one eleventh of the
aggregate principal amount of all the Securities to be purchased at such Time of
Delivery, then the Company shall have the right to require each non-defaulting
Underwriter to purchase the principal amount of Securities which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the principal amount of Securities which such Underwriter agreed
to purchase hereunder) of the Securities of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
-23-
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one eleventh of the aggregate principal amount
of all the Securities to be purchased at such Time of Delivery, or if the
Company shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Securities of a defaulting
Underwriter or Underwriters, then this Agreement (or, with respect to the Second
Time of Delivery, the obligation of the Underwriters to purchase and of the
Company to sell the Optional Securities) shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company, except
for the expenses to be borne by the Company and the Underwriters as provided in
Section 7 hereof and the indemnity and contribution agreements in Section 9
hereof; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
11. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
12. If this Agreement shall be terminated pursuant to Section 10 hereof,
the Company shall not then be under any liability to any Underwriter except as
provided in Sections 7 and 9 hereof; but, if for any other reason, any
Securities are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Underwriters through you for all out of pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Securities, but the Company shall then be
under no further liability to any Underwriter except as provided in Sections 7
and 9 hereof.
13. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Xxxxxxx, Sachs &
Co., Xxx Xxx Xxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
-24-
Registration Department; and if to the Company shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company set forth in
the Registration Statement, Attention: Secretary; provided, however, that any
notice to an Underwriter pursuant to Section 9(c) hereof shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter at its address
set forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by you upon
request. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
14. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and, to the extent provided in Sections 9 and
11 hereof, the officers and directors of the Company and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
15. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
16. The Company acknowledges and agrees that (i) the purchase and sale of
the Securities pursuant to this Agreement is an arm's-length commercial
transaction between the Company, on the one hand, and the several Underwriters,
on the other, (ii) in connection therewith and with the process leading to such
transaction each Underwriter is acting solely as a principal and not the agent
or fiduciary of the Company, (iii) no Underwriter has assumed an advisory or
fiduciary responsibility in favor of the Company with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company on other matters)
or any other obligation to the Company except the obligations expressly set
forth in this Agreement, and (iv) the Company has consulted its own legal and
financial advisors to the extent it deemed appropriate. The Company agrees that
it will not claim that the Underwriters, or any of them, has rendered advisory
services of any nature or respect, or owes a fiduciary or similar duty to the
Company, in connection with such transaction or the process leading thereto.
17. This Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Company and the Underwriters, or any of
them, with respect to the subject matter hereof.
18. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
-25-
19. The Company and each of the Underwriters hereby irrevocably waives, to
the fullest extent permitted by applicable law, any and all right to trial by
jury in any legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
20. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
21. Notwithstanding anything herein to the contrary, the Company is
authorized to disclose to any persons the U.S. federal and state income tax
treatment and tax structure of the potential transaction and all materials of
any kind (including tax opinions and other tax analyses) provided to the Company
relating to that treatment and structure, without the Underwriters, imposing any
limitation of any kind. However, any information relating to the tax treatment
and tax structure shall remain confidential (and the foregoing sentence shall
not apply) to the extent necessary to enable any person to comply with
securities laws. For this purpose, "tax structure" is limited to any facts that
may be relevant to that treatment.
-26-
If the foregoing is in accordance with your understanding, please sign and
return to us [___] counterparts hereof, and upon the acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof
shall constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on your part as to
the authority of the signers thereof.
Very truly yours,
CUBIST PHARMACEUTICALS, INC.
By:
----------------------------------
Name:
Title:
Accepted as of the date hereof:
XXXXXXX, XXXXX & CO.
[NAME(s) OF CO REPRESENTATIVE(s)]
BY:
-----------------------------------
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Underwriters
-27-
