Exhibit 1.1
4,000,000 SHARES
THE MEDICINES COMPANY
COMMON STOCK, $.001 PAR VALUE PER SHARE
UNDERWRITING AGREEMENT
______________, 2003
_______________, 2003
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
THE MEDICINES COMPANY, a Delaware corporation (the "COMPANY"), proposes to
issue and sell to the several Underwriters named in Schedule I hereto (the
"UNDERWRITERS") 4,000,000 shares of its Common Stock, $.001 par value per share
(the "FIRM SHARES"). The Company also proposes to issue and sell to the several
Underwriters not more than an additional 600,000 shares of its Common Stock,
$.001 par value per share (the "ADDITIONAL SHARES"), if and to the extent that
you, as Managers of the offering, shall have determined to exercise, on behalf
of the Underwriters, the right to purchase such shares of common stock granted
to the Underwriters in Section 2 hereof. The Firm Shares and the Additional
Shares are hereinafter collectively referred to as the "SHARES." The shares of
Common Stock, $.001 par value per share, of the Company to be outstanding after
giving effect to the sales contemplated hereby are hereinafter referred to as
the "COMMON STOCK."
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement on Form S-3 (File No. 333-103601),
including a prospectus, relating to the Shares. The registration statement as
amended at the time it becomes effective, including the information (if any)
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), is hereinafter referred to as the "REGISTRATION STATEMENT";
the prospectus in the form first used to confirm sales of Shares is hereinafter
referred to as the "PROSPECTUS." The term "PRELIMINARY PROSPECTUS" as used in
this Agreement shall mean each preliminary prospectus included in the
Registration Statement prior to the time it becomes effective. If the Company
has filed an abbreviated registration statement to register additional shares of
Common Stock 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
(including, in
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the case of all references to the Registration Statement and the Prospectus,
documents incorporated therein by reference).
1. Representations and Warranties. The Company represents and
warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement, excluding, if applicable, any
Rule 462 Registration Statement, has become effective; the Rule 462
Registration, if applicable, will become effective upon filing with the
Commission; no stop order suspending the effectiveness of the Registration
Statement is in effect, and no proceedings for such purpose are pending
before or threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant
to the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT")
and incorporated by reference in the Prospectus complied or will comply
when so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii) the
Registration Statement, when it became effective, did not contain and, any
post effective amendment to the Registration Statement on the date it
becomes effective, if applicable, will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (iii)
the Registration Statement, when it became effective, complied, and the
Prospectus, when filed with the Commission pursuant to Rule 424(b) of the
Securities Act, will comply and, at any time when any post effective
amendment to the Registration Statement is declared effective or any
amendment or supplement to the Prospectus is filed with the Commission, if
applicable, such documents will comply in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (iv) the Prospectus when filed with the Commission pursuant
to Rule 424(b) of the Securities Act, and any amendment or supplement to
the Prospectus on the date filed with the Commission, if applicable, will
not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that
the representations and warranties set forth in this paragraph do not
apply to statements or omissions in the Registration Statement or the
Prospectus based upon information relating to any Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use
therein.
(c) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State of
Delaware, has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly qualified
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to transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be
so qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole (a "Company
Material Adverse Effect").
(d) Each subsidiary of the Company has been duly incorporated,
is validly existing as a corporation in good standing (to the extent that
the concept of good standing is applicable) under the laws of the
jurisdiction of its incorporation, has the corporate power and authority
to own its property and to conduct its business as described in the
Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to
the extent that the failure to be so qualified or be in good standing
would not have a Company Material Adverse Effect, 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, to the extent that the
concept of non-assessability is applicable, non-assessable and, except for
directors' qualifying shares in the case of non-U.S. subsidiaries and
except as described in the Prospectus, are owned directly by the Company,
free and clear of all liens, encumbrances, equities or claims.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The authorized capital stock of the Company conforms in
all material respects as to legal matters to the description thereof
contained in the Prospectus.
(g) The shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly issued,
fully paid and non-assessable. No person is entitled to preemptive or
similar rights to acquire any securities of the Company. Except as set
forth in the Prospectus, there are no outstanding securities convertible
into or exchangeable for, or warrants, rights or options to purchase from
the Company, or obligations of the Company to issue, any shares of its
Common Stock or any other class of shares of capital stock of the Company.
(h) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares
will not be subject to any preemptive or similar rights.
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(i) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement will
not contravene any provision of (i) applicable law, (ii) the certificate
of incorporation or by-laws of the Company, (iii) any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or (iv)
any judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, except with
respect to clauses (i), (iii) and (iv) for any contraventions that would
not have a Company Material Adverse Effect. No consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the performance by the Company of its obligations
under this Agreement, except (i) such as have been obtained or made under
the Securities Act, (ii) such as may be required by the securities or Blue
Sky laws of the various states in connection with the offer and sale of
the Shares, or (iii) such as may be required by the National Association
of Securities Dealers, Inc. in connection with the purchase and
distribution of the Shares.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(k) There are no legal or governmental proceedings pending or,
to the knowledge of the Company, threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of the
Company or any of its subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus pursuant to the
Securities Act or the rules and regulations promulgated thereunder, and
are not so described or any statutes, regulations, contracts or other
documents that are required to be described in the Registration Statement
or the Prospectus or to be filed as exhibits to the Registration
Statement, in each case pursuant to the Securities Act or the rules and
regulations promulgated thereunder, that are not described or filed as
required.
(l) 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 the
applicable rules and regulations of the Commission thereunder.
(m) The Company is not, and after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as
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described in the Prospectus will not be, required to register as an
"investment company" as such term is defined in the Investment Company Act
of 1940, as amended.
(n) The Company and its subsidiaries (i) are 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 (including without limitation all laws and regulations
relating to biohazardous materials) ("ENVIRONMENTAL LAWS"), (ii) have
received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and
(iii) are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with Environmental
Laws, failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits, licenses
or approvals would not, singly or in the aggregate, have a Company
Material Adverse Effect.
(o) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval, any
related constraints on operating activities and any potential liabilities
to third parties) which would, singly or in the aggregate, have a Company
Material Adverse Effect.
(p) Except as described in the Prospectus, there are no
contracts, agreements or understandings between the Company and any person
granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company or to require the Company to include such
securities with the Shares registered pursuant to the Registration
Statement. All persons who possess such rights have effectively waived
them with respect to the offering of the Shares.
(q) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
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the chief executive officer and principal financial officer of the Company
have made all certifications required by the Xxxxxxxx-Xxxxx Act of 2002
(the "XXXXXXXX-XXXXX ACT") and any related rules and regulations
promulgated by the Commission, and the statements contained in any such
certification are complete and correct; the Company maintains "disclosure
controls and procedures" (as defined in Rule 13a-14(c) under the Exchange
Act); and the Company is otherwise in compliance in all material respects
with all applicable effective provisions of the Xxxxxxxx-Xxxxx Act and the
rules and regulations issued thereunder by the Commission.
(r) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, (i) the Company
and its subsidiaries, taken as a whole, have not incurred any material
liability or obligation, direct or contingent, nor entered into any
material transaction not in the ordinary course of business; (ii) the
Company and its subsidiaries have not purchased any of the Company's
outstanding capital stock, and the Company has not declared, paid or
otherwise made any dividend or distribution of any kind on its capital
stock; and (iii) there has not been any material change in the capital
stock, short-term debt or long-term debt of the Company and its
subsidiaries, taken as a whole, except in each case as reflected in the
Prospectus.
(s) The Company and its subsidiaries do not own any real
property; each of the Company and its subsidiaries has good and marketable
title to all personal property owned by such entity which is material to
the business of the Company and its subsidiaries taken as a whole, free
and clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not interfere in any material
respect with the use made and currently proposed to be made of such
property by the Company and its subsidiaries; and any real or personal
property and buildings held under lease by each of the Company and its
subsidiaries are held by such entity under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere in any material respect with the use made and currently proposed
to be made of such property and buildings by the Company and its
subsidiaries, in each case except as described in the Prospectus.
(t) The Company and its subsidiaries own or possess adequate
licenses or other rights to use the patents, patent rights and patent
applications (the "COMPANY PATENTS"), the inventions, copyrights,
trademarks, service marks, trade names and know-how (including trade
secrets and other unpatented and/or unpatentable proprietary rights, and
excluding generally commercially available "off the shelf" software
programs licensed pursuant to shrink wrap or "click and accept" licenses)
(collectively, "INTELLECTUAL PROPERTY") necessary to conduct the business
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of the Company and its subsidiaries in the manner described in the
Prospectus and the absence of which, individually or in the aggregate,
would have a Company Material Adverse Effect (collectively, the "COMPANY
INTELLECTUAL PROPERTY"). Except as disclosed in the Prospectus, neither
the Company nor any of its subsidiaries is obligated to pay a royalty,
grant a license, or provide other consideration to any third party in
connection with any Company Intellectual Property. Except as disclosed in
the Prospectus, neither the Company nor any of its subsidiaries has
received any notice of infringement of or conflict with any Intellectual
Property rights of others. Except as disclosed in the Prospectus, the
discoveries, inventions, products or processes of the Company and its
subsidiaries referred to in the Prospectus do not, to the knowledge of the
Company, infringe, interfere or conflict with any right or patent claim of
any third party, or with any earlier discovery, invention, product or
process that is the subject of a patent application filed by any third
party, known to the Company. Except as described in the Prospectus, no
third party, including any academic or governmental organization,
possesses or could obtain rights to the Company Intellectual Property
which, if exercised, would allow such party to develop products
competitive to those of the Company and its subsidiaries.
(u) All patent applications that resulted in Company Patents
or pending applications that describe inventions necessary to conduct the
business of the Company and its subsidiaries in the manner described in
the Prospectus (the "COMPANY PATENT APPLICATIONS") have been duly and
properly filed (have been accorded filing dates and serial numbers and
assignments have been recorded for each listed inventory) or caused to be
filed with the United States Patent and Trademark Office (the "PTO") and
applicable foreign and international patent authorities. In connection
with the filing of the Company Patent Applications, to the knowledge of
the Company, all printed publications and patent references relevant to
the patentability of the inventions claimed in such applications has been
disclosed to those patent offices so requiring. To the knowledge of the
Company, the Company or its licensor, as applicable, has met its duty of
candor and good faith to the PTO for the Company Patent Applications. To
the knowledge of the Company, no material misrepresentation have been made
to the PTO by or in connection with the Company Patent Applications. The
Company and its subsidiaries are not aware or any facts material to a
determination of patentability regarding the Company Patent Applications
not called to the attention of the PTO. The Company and its subsidiaries
are not aware of any facts not called to the attention of the PTO which
would preclude the grant of a patent for the Company Patent Applications.
The Company has no knowledge of any facts which would preclude the Company
or its licensor, as applicable, from having clear title to the Company
Patent Applications.
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(v) No material labor dispute with the employees of the
Company or any of its subsidiaries exists, or, to the knowledge of the
Company, is imminent; and the Company is not aware of any existing,
threatened or imminent labor disturbance by the employees of any of its or
any of its subsidiaries' principal suppliers, manufacturers or contractors
that could have a Company Material Adverse Effect
(w) The Company and its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as are adequate for the
conduct of its business and the value of its properties and as are
customary in the businesses in which the Company and its subsidiaries are
engaged; neither the Company nor any of its subsidiaries have been refused
any insurance coverage sought or applied for; and neither the Company nor
any of its subsidiaries has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not have a Company Material
Adverse Effect.
(x) Except as described in the Prospectus, 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, except
as described in the Prospectus, neither the Company nor any of its
subsidiaries have 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.
(y) 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 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
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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 Company Material Adverse Effect.
(z) Ernst & Young LLP are, and during the periods covered in
their report included in the Registration Statement and the Prospectus
were, independent accountants with respect to the Company as required by
the Securities Act.
(aa) The consolidated financial statements of the Company and
its subsidiaries (together with the related notes thereto) included in the
Registration Statement present fairly the consolidated financial position
and results of the operations of the Company and its subsidiaries as of
the respective dates indicated and for the respective periods specified,
subject in the case of interim periods to normal year-end adjustments; and
such consolidated financial statements (together with the related notes
thereto) have been prepared in conformity with generally accepted
accounting principles, consistently applied throughout the periods
presented except as otherwise stated therein.
(bb) Each material contract, agreement and license filed as an
exhibit to the Registration Statement to which the Company or any of its
subsidiaries is bound is legal, valid, binding, enforceable in accordance
with its terms and in full force and effect against the Company or such
subsidiary, and to the knowledge of the Company, each other party thereto.
Neither the Company nor any of its subsidiaries nor to the Company's
knowledge any other party is in material breach or default with respect to
any such contract, agreement and license, and, to the Company's knowledge,
no event has occurred which with notice or lapse of time would constitute
a material breach or default, or permit termination, modification, or
acceleration, under any such contract, agreement or license. No party has
repudiated any material provision of any such contract, agreement or
license.
(cc) The Company has filed a notice of listing of the Shares
on The Nasdaq National Market; the Common Stock is registered pursuant to
Section 12(g) of the Exchange Act, and the outstanding shares of Common
Stock are listed for quotation on The Nasdaq National Market, and the
Company has taken no action designed to, or likely to have the effect of,
terminating the registration of the Common Stock under the Exchange Act or
de-listing the Common Stock from The Nasdaq National Market, nor has the
Company received any notification that the Commission or The Nasdaq
National Market is contemplating terminating such registration or listing.
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(dd) The statistical and market-related data included in the
Registration Statement and the Prospectus are based on or derived from
sources which 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. Agreements to Sell and Purchase. The Company hereby agrees to
sell to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $______ a share (the "PURCHASE PRICE").
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have the
right to purchase, severally and not jointly, up to 600,000 Additional Shares at
the Purchase Price. You may exercise this right on behalf of the Underwriters in
whole or from time to time in part by giving written notice of each election to
exercise the option not later than 30 days after the date of this Agreement. Any
exercise notice shall specify the number of Additional Shares to be purchased by
the Underwriters and the date on which such shares are to be purchased. Each
purchase date must be at least one business day after the written notice is
given and may not be earlier than the closing date for the Firm Shares nor later
than ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 4 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. On each
day, if any, that Additional Shares are to be purchased (an "OPTION CLOSING
DATE"), each Underwriter agrees, severally and not jointly, to purchase the
number of Additional Shares (subject to such adjustments to eliminate fractional
shares as you may determine) that bears the same proportion to the total number
of Additional Shares to be purchased on such Option Closing Date as the number
of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Underwriters, it will not,
during the period ending 90 days after the date of the Prospectus, (i) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, 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
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cash or otherwise. The foregoing sentence shall not apply to (A) the Shares to
be sold hereunder or (B) the issuance by the Company of shares of Common Stock
pursuant to its 2000 Employee Stock Purchase Plan as in effect on the date
hereof or upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof of which the Underwriters have been
advised in writing.
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at
$_____________ a share (the "PUBLIC OFFERING PRICE") and to certain dealers
selected by you at a price that represents a concession not in excess of $______
a share under the Public Offering Price, and that any Underwriter may allow, and
such dealers may reallow, a concession, not in excess of $_____ a share, to any
Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made
to the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on [T+3], 2003, or at such other
time on the same or such other date, not later than [+5], 2003, as shall be
designated in writing by you. The Closing of the offering and sale of the Firm
Shares will be held at the offices of Ropes & Xxxx, Xxx Xxxxxxxxxxxxx Xxxxx,
Xxxxxx, XX 00000.
Payment for any Additional Shares shall be made to the Company in Federal
or other funds immediately available in New York City against delivery of such
Additional Shares for the respective accounts of the several Underwriters at
10:00 a.m., New York City time, on the date specified in the corresponding
notice described in Section 2 or at such other time on the same or on such other
date, in any event not later than [green shoe expiration + 10 days], 2003, as
shall be designated in writing by you. The time and date of such payment are
hereinafter referred to as the "OPTION CLOSING DATE." The Closing of the
offering and sale of the Additional Shares will be held at the offices of Ropes
& Xxxx, Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, XX 00000.
The Firm Shares and Additional Shares shall be registered in such names
and in such denominations as you shall request in writing not later than one
full business day prior to the Closing Date or the applicable Option Closing
Date, as the case may be. The Firm Shares and Additional Shares shall be
delivered to you on the Closing Date or an Option Closing Date, as the case may
be, for the respective accounts of the several Underwriters, with any transfer
taxes payable in connection with the transfer of the Shares to the Underwriters
duly paid, against payment of the Purchase Price therefor.
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5. Conditions to the Underwriters' Obligations. The obligations of
the Company to sell the Shares to the Underwriters and the several obligations
of the Underwriters to purchase and pay for the Shares on the Closing Date and
any Option Closing Date are subject to the condition that the Registration
Statement shall have become effective not later than [_____] (New York City
time) on the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date and any Option Closing Date, as the case may
be:
(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your
judgment, impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date
and any Option Closing Date, as the case may be, a certificate, dated such
date and signed by an executive officer of the Company, to the effect set
forth in Section 5(a)(i) above and to the effect that the representations
and warranties of the Company contained in this Agreement are true and
correct as of such date and that the Company has complied with all of the
agreements and satisfied all of the conditions on its part to be performed
or satisfied hereunder on or before such date. The officer signing and
delivering such certificate may rely upon his or her knowledge as to
proceedings threatened.
(c) The Underwriters shall have received on the Closing Date
and any Option Closing Date, as the case may be, an opinion of Xxxx and
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Xxxx XXX, xxxxxxx counsel for the Company, dated such date, to the effect
that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
State of Delaware, has the corporate power and authority to own and
lease its property and to conduct its business, each as described in
the Prospectus, and is duly qualified to transact business and in
good standing as a foreign corporation in the State of New Jersey
and the Commonwealth of Massachusetts;
(ii) The Medicines Securities Corporation has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the Commonwealth of Massachusetts;
(iii) the shares of Common Stock issued and outstanding
prior to the issuance of the Shares have been duly authorized and
are validly issued, fully paid and non-assessable;
(iv) all of the issued shares of capital stock of The
Medicines Securities Corporation have been duly and validly
authorized and issued, are fully paid and non-assessable and are
owned of record directly by the Company;
(v) the Shares to be issued at the applicable closing
date have been duly authorized and, when issued and delivered in
accordance with the terms of this Agreement, will be validly issued,
fully paid and non-assessable, and the issuance of such Shares will
not be subject to any preemptive rights under the Delaware General
Corporation Law statute, the certificate of incorporation or by-laws
of the Company, each as amended to date, or, to our knowledge,
similar rights granted pursuant to a contract which is filed as an
exhibit to the Registration Statement or any document incorporated
by reference therein;
(vi) this Agreement has been duly authorized by all
necessary corporate action on the part of the Company and has been
duly executed and delivered by the Company;
(vii) the execution and delivery of this Agreement by
the Company, the consummation by the Company of the transactions
contemplated hereby and the performance by the Company of its
obligations hereunder (other than the obligations arising under the
indemnification and contribution provisions of this Agreement, as to
which such counsel need not express any opinion) will not (a)
contravene any provision of the certificate of incorporation or
by-laws of the Company, each as amended to
13
date, (b) result in any breach or violation of any of the terms or
provisions of any agreement or other instrument to which the Company
is a party and which is filed as an exhibit to the Registration
Statement or any document incorporated by reference therein, (c)
violate any applicable United States federal or Massachusetts state
statute, rule or regulation which in the experience of such counsel
is normally applicable in transactions of the type contemplated by
the Agreement or the Delaware General Corporation Law statute, or
(d) contravene any judgment, order or decree specifically naming the
Company of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary of which such
counsel is aware; and no consent, approval, authorization or order
of, or qualification with, any governmental body or agency is
required for the performance by the Company of its obligations under
this Agreement, except such as may have been obtained or made under
the Securities Act, such as may be required by the securities or
Blue Sky laws of the various states in connection with the offer and
sale of the Shares, or such as may be required by the National
Association of Securities Dealers, Inc. in connection with the
purchase and distribution of the Shares;
(viii) the statements relating to legal matters,
documents or proceedings included under the captions "Risk Factors
-- A breach of any of the agreements under which we license
commercialization rights to products or technology from others,
could cause us to lose license rights that are important to our
business or subject us to claims by our licensors," "Risk Factors
--We may not be able to obtain or maintain patent protection for our
products, and we may infringe the patent rights of others,"
"Business - Patents, Proprietary Rights and Licenses," "Business --
License Agreements" and "Underwriters" in the Prospectus, under the
caption "Description of Capital Stock" in the Company's Registration
Statement on Form 8-A declared effective on July 28, 2000 (which
description is incorporated by reference into the Registration
Statement), and in Item 15 of the Registration Statement, in each
case insofar as such statements constitute summaries of matters of
law or legal conclusions, fairly summarize such matters and
conclusions in all material respects;
(ix) such counsel does not know of any legal or
governmental proceedings pending or threatened against the Company
that are required to be described in the Registration Statement or
the Prospectus and are not so described;
14
(x) to such counsel's knowledge, there are no
agreements, contracts, leases or documents to which the Company is a
party which are required by the Securities Act and the applicable
rules and regulations of the Commission thereunder to be filed as an
exhibit to the Registration Statement or any document incorporated
by reference therein that are not so filed;
(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 of 1940, as amended;
(xii) to the knowledge of such counsel, except as
described in the Prospectus, there are no contracts, agreements or
understandings between the Company and any person granting such
person the right to require the Company to file a registration
statement under the Securities Act with respect to any securities of
the Company or to require the Company to include such securities
with the Shares registered pursuant to the Registration Statement,
and all persons who to such counsel's knowledge possess such rights
have effectively waived them with respect to the offering of the
Shares;
(xiii) to such counsel's knowledge, the Company owns,
possesses or has adequate rights to use the Intellectual Property
reasonably necessary to carry on the business conducted by it as
described in the Prospectus, except to the extent that the failure
to own, possess or have adequate rights to use such Intellectual
Property could not, individually or in the aggregate, reasonably be
expected to have a Company Material Adverse Effect;
(xiv) other than as set forth or contemplated in the
Prospectus, to such counsel's knowledge, 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 Company
Material Adverse Effect;
(xv) other than as set forth or contemplated in the
Prospectus, to such counsel's knowledge, the discoveries,
inventions, products or processes of the Company referred to in the
Registration Statement and the Prospectus do not infringe interfere
or conflict with any rights of any third party, or with any
discovery, invention, product or process, which right, discovery,
15
invention, product or process is the subject of a patent application
filed by any third party which patent application has been published
in the United States Patent and Trademark Office or the World
Intellectual Patent Office 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
Company Material Adverse Effect;
(xvi) other than as set forth or contemplated in the
Prospectus, to the knowledge of such counsel, no third party,
including any academic or governmental organization, possesses or
could obtain rights to the patents, patent applications or patent
rights of the Company which, if exercised, would allow such third
party to develop products competitive with those of the Company
could reasonably be expected to have a Company Material Adverse
Effect;
(xvii) to the knowledge of such counsel, (A) the Company
Patents are valid and enforceable and are entitled to a statutory
presumption of validity and of ownership by the assignee, (B) there
are no asserted or unasserted claims of any persons relating to the
scope or ownership of any of the Company Patents or any of the
Company Patent Applications, and (C) there are no liens which have
been filed against any of the Company Patents or the Company Patent
Applications;
(xviii) to the knowledge of such counsel, all pertinent
references were disclosed to the PTO during the prosecution of the
Company Patents and the Company Patent Applications and no
misrepresentation was made to, or material fact withheld from, the
PTO during such prosecution;
(xix) to the knowledge of such counsel, there are no
asserted claims of any persons relating to the ownership of any of
the Company's United States trademark applications and
registrations, there are no liens recorded against any of such
applications in the United States Patent and Trademark Office and
none of such applications have been abandoned;
(xx) the trademark ANGIOMAX has been registered in the
United States, Canada and the Community Trademark Office;
(xxi) the Registration Statement and the Prospectus
(except for the financial statements, including the notes thereto,
and other financial, accounting and statistical data included
therein, as to which such counsel need not express any opinion)
comply as
16
to form in all material respects with the requirements of the
Securities Act and the applicable rules and regulations of the
Commission thereunder; and
(xxii) any document filed pursuant to the Exchange Act
and incorporated by reference in the Registration Statement or the
Prospectus, when so filed, complied as to form in all material
respects with the requirements of the Securities Act and the
applicable rules and regulations of the Commission thereunder.
In addition, such opinion shall contain a statement that in
connection with the preparation of the Registration Statement and
the Prospectus, such counsel has participated in conferences with
officers and representatives of the Company, counsel for the
Underwriters and the independent accountant of the Company, at which
conferences such counsel made inquiries of such persons and others
and discussed the contents of the Registration Statement and the
Prospectus, and that while the limitations inherent in the
independent verification of factual matters and the character of
determinations involved in the registration process are such that
such counsel is not passing upon and does not assume responsibility
for the accuracy or completeness of the statements contained in the
Registration Statement or the Prospectus, subject to the foregoing
and based upon such participation, inquiries and discussions,
nothing has come to the attention of such counsel that causes such
counsel to believe that the Registration Statement and the
prospectus included therein (except for the financial statements,
including the notes thereto, and other financial, accounting and
statistical data including therein, as to when such counsel need not
express any belief) at the time the Registration Statement was
declared effective by the Commission 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 or that the Prospectus (except for the financial
statements, including the notes thereto, and other financial,
accounting and statistical data included therein, as to which such
counsel need not express any belief), as of the date it was filed
with the Commission pursuant to Rule 424(b) of the Securities Act or
as of the applicable closing date, contained or contains an untrue
statement of a material act or omitted or omits 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;
(d) The Underwriters shall have received on the Closing Date
and any Option Closing Date, as the case may be, an opinion of Buc &
17
Xxxxxxxxx, in its capacity as special regulatory counsel to the Company,
dated such date, to the effect that nothing has come to such counsel's
attention that would lead such counsel to believe that the statements in
the Registration Statement and the Prospectus set forth under "Risk
Factors -- We cannot expand the indications for which we are marketing
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 succeed in obtaining
timely approval for a second-generation process for the production of
Angiomax bulk drug substance, we may not be able to supply our customers,"
"Risk Factors -- Clinical trials of our product candidates are expensive
and time-consuming, and the results of these trials are uncertain," "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," "Business - Angiomax -- Clinical
Trials in Coronary Angioplasty," "Business - Angiomax -- Regulatory
Status" and "Business - Manufacturing - Angiomax," insofar as such
statements concern the Federal Food, Drug and Cosmetic Act and the Public
Health Services Act and the regulations promulgated thereunder, in the
case of the Registration Statement and the prospectus included therein as
of the time the Registration Statement became effective, contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or, in the case of the Prospectus as of the date it was
filed with the Commission pursuant to Rule 424(b) of the Securities Act or
as of the applicable closing date, contained or contains an untrue
statement of a material act or omitted or omits 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.
(e) The Underwriters shall have received on the Closing Date
an opinion of Ropes & Xxxx, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in Sections 5(c)(v),
5(c)(vi) and 5(c)(viii) (but only as to the statements in the Prospectus
under "Underwriters") and in the unnumbered paragraph following Section
5(c)(xxii) above.
With respect to the unnumbered paragraph following Section
5(c)(xxii) above, Xxxx and Xxxx LLP and Ropes & Xxxx may state that
their beliefs are based upon their participation in the preparation
of the Registration Statement and Prospectus and any amendments or
supplements thereto and documents incorporated by reference and
review and discussion of the contents, thereof, and review and
discussion of the contents thereof, but are without independent
check or verification, except as specified. With respect to the
unnumbered paragraph following Section 5(c)(xxii)
18
above, Ropes & Xxxx may state that their beliefs are based upon
their participation in the preparation of the Registration Statement
and Prospectus and any amendments or supplements thereto (other than
documents incorporated by reference) and upon review and discussion
of the contents thereof (including documents incorporated by
reference), but are without independent check or verification except
as specified.
The opinion of Xxxx and Xxxx LLP described in Section 5(c) above and
the opinion of Buc & Xxxxxxxxx described in Section 5(d) above shall
be rendered to the Underwriters at the request of the Company and
shall so state therein.
(f) The Underwriters shall have received, on each of the date
hereof, the Closing Date and any Option Closing Date, a letter dated such
date, in form and substance satisfactory to the Underwriters, from Ernst &
Young LLP, independent public accountants, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in or incorporated by reference
into the Registration Statement and the Prospectus; provided that the
letter delivered on the Closing Date shall use a "cut-off date" not
earlier than the date hereof.
(g) The "lock-up" agreements, each substantially in the form
of Exhibit A hereto, between you and certain officers and directors 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 and
any Option Closing Date, as the case may be.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the applicable Option Closing
Date of such documents as you may reasonably request with respect to the good
standing of the Company, the due authorization and issuance of the Additional
Shares to be sold on such Option Closing Date and other matters related to the
issuance of such Additional Shares.
6. Covenants of the Company. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish to you, without charge, [number of managers +
1] signed copies of the Registration Statement (including exhibits thereto
and documents incorporated by reference) and for delivery to each other
Underwriter a conformed copy of the Registration Statement (without
19
exhibits thereto but including documents incorporated by reference) and to
furnish to you in New York City, without charge, prior to 10:00 a.m. New
York City time on the business day next succeeding the date of this
Agreement and during the period mentioned in Section 6(c) below, as many
copies of the Prospectus, any documents incorporated by reference, and any
supplements and amendments thereto or to the Registration Statement as you
may reasonably request. The terms "supplement" and "amendment" or "amend"
as used in this Agreement shall include all documents subsequently filed
by the Company with the Commission pursuant to Exchange Act that are
deemed to be incorporated by reference in the Prospectus.
(b) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you reasonably object, and to file with
the Commission within the applicable period specified in Rule 424(b) under
the Securities Act any prospectus required to be filed pursuant to such
Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters
the Prospectus is required by law to be delivered in connection with sales
by an Underwriter or dealer, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading, or if, in
the opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to the
Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which Shares may have been sold by you on
behalf of the Underwriters and to any other dealers upon request, either
amendments or supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(d) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request.
(e) To make generally available to the Company's security
holders and to you as soon as practicable an earning statement covering
the twelve-month period ending [March 31, 2004] that satisfies the
20
provisions of Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder.
(f) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or cause
to be paid all expenses incident to the performance of its obligations
under this Agreement, including: (i) the fees, disbursements and expenses
of the Company's counsel and the Company's accountants in connection with
the registration and delivery of the Shares under the Securities Act and
all other fees or expenses in connection with the preparation and filing
of the Registration Statement, any preliminary prospectus, the Prospectus
and amendments and supplements to any of the foregoing, including all
printing costs associated therewith, and the mailing and delivering of
copies thereof to the Underwriters and dealers, in the quantities
hereinabove specified, (ii) all costs and expenses related to the transfer
and delivery of the Shares to the Underwriters, including any transfer or
other taxes payable thereon, (iii) the cost of printing or producing any
Blue Sky or Legal Investment memorandum in connection with the offer and
sale of the Shares under state securities laws and all expenses in
connection with the qualification of the Shares for offer and sale under
state securities laws as provided in Section 6(d) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with
the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the
reasonable fees and disbursements of counsel to the Underwriters incurred
in connection with the review and qualification of the offering of the
Shares by the National Association of Securities Dealers, Inc., (v) all
costs and expenses incident to listing the Shares on the Nasdaq National
Market, (vi) the cost of printing certificates representing the Shares,
(vii) the costs and charges of any transfer agent, registrar or
depositary, (viii) the costs and expenses of the Company relating to
investor presentations on any "road show" undertaken in connection with
the marketing of the offering of the Shares, including, without
limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in connection
with the road show presentations with the prior approval of the Company,
travel and lodging expenses of the representatives and officers of the
Company and any such consultants, and the cost of any aircraft chartered
in connection with the road show, (ix) the document production charges and
expenses associated with printing this Agreement and (x) all other costs
and expenses incident to the performance of the obligations of the Company
hereunder for which provision is not otherwise made in this Section. It is
understood, however, that except as provided in this Section, Section 7
entitled "Indemnity and Contribution", and the last paragraph of Section 9
below, the Underwriters will pay all of their costs and expenses,
including fees and disbursements of their counsel, stock transfer taxes
payable on resale of any of the Shares
21
by them and any advertising expenses connected with any offers they may
make.
7. Indemnity and Contribution. (a) The Company agrees to indemnify
and hold harmless each Underwriter, each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT"), and each affiliate of any Underwriter within the meaning of Rule 405
under the Securities Act, from and against any and all losses, claims, damages
and liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), 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
such untrue statement or omission or alleged untrue statement or omission based
upon information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein.
(b) 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, if any, who controls the
Company within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the foregoing
indemnity from the Company to such Underwriter, but only with reference to
information relating to such Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 7(a) or 7(b), such
person (the "INDEMNIFIED PARTY") shall promptly notify the person against
whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually
22
agreed to the retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for the fees and expenses of more than
one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing
by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of parties indemnified
pursuant to Section 7(a), and by the Company, in the case of parties
indemnified pursuant to Section 7(b). The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment.. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section
7(a) or 7(b) is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein,
then each indemnifying party under such paragraph, in lieu of indemnifying
such indemnified party thereunder, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the 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 7(d)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause 7(d)(i) above but also the
relative fault of the Company on the one hand and of 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 in
connection with the offering of the Shares shall be deemed to be in the
same respective proportions as the net proceeds from the offering of the
Shares (before deducting expenses) received by the Company and the total
underwriting
23
discounts and commissions received by the Underwriters, in each case as
set forth in the table on the cover of the Prospectus, bear to the
aggregate 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 Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not
be just or 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 purpose) or by any other method of allocation that
does not take account of the equitable considerations referred to in
Section 7(d). The amount paid or payable by an indemnified party 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 reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 7, no Underwriter shall 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 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.
(f) The indemnity and contribution provisions contained in
this Section 7 and the representations, warranties and other statements of
the Company contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Underwriter, any person
controlling any Underwriter or any affiliate of any Underwriter or by or
on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Shares.
24
8. Termination. The Underwriters may terminate this Agreement by
notice given by you to the Company, if after the execution and delivery of this
Agreement and prior to the 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 of Options Exchange, the Chicago Mercantile Exchange or the
Chicago Board of Trade, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
material disruption in securities settlement, payment or clearance services in
the United States shall have occurred, (iv) any moratorium on commercial banking
activities shall have been declared by Federal or New York State authorities or
(v) there shall have occurred any outbreak or escalation of hostilities, or any
change in financial markets or any calamity or crisis that, in your judgment, is
material and adverse and which, singly or together with any other event
specified in this clause (v), makes it, in your judgment, impracticable or
inadvisable to proceed with the offer, sale or delivery of the Shares on the
terms and in the manner contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or an Option Closing Date, as the case may be, any
one or more of the Underwriters shall fail or refuse to purchase Shares that it
has 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 the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule I bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you 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 this Agreement be
increased pursuant to this Section 9 by an amount in excess of one-ninth of such
number of Shares without the written consent of such Underwriter. If, on the
Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Firm Shares and the aggregate number of Firm Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Firm Shares to
be purchased, and arrangements satisfactory to you and the Company for the
purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either you or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. If, on an
25
Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased on such Option Closing Date, the
non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase the Additional Shares to be sold on such Option
Closing Date or (ii) purchase not less than the number of Additional Shares that
such non-defaulting Underwriters would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of the Company to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
12. Headings. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
26
Very truly yours,
THE MEDICINES COMPANY
By:
--------------------------------
Name:
Title:
Accepted as of the date hereof
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
Acting severally on behalf of themselves
and the several Underwriters named in
Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
------------------------------
Name:
Title:
SCHEDULE I
NUMBER OF FIRM SHARES
UNDERWRITER TO BE PURCHASED
Xxxxxx Xxxxxxx & Co. Incorporated ......
Bear, Xxxxxxx & Co. Inc.................
CIBC World Markets Corp.................
---------------------
Total:............................
EXHIBIT A
[FORM OF LOCK-UP LETTER]
_____________, 2003
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("XXXXXX XXXXXXX") proposes to enter into an Underwriting Agreement (the
"UNDERWRITING AGREEMENT") with The Medicines Company, a Delaware corporation
(the "COMPANY"), providing for the public offering (the "PUBLIC OFFERING") by
the several Underwriters, including Xxxxxx Xxxxxxx (the "UNDERWRITERS"), of
shares (the "SHARES") of the Common Stock, $.001 par value per share, of the
Company (the "COMMON STOCK").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 90 days after the date of the final prospectus relating
to the Public Offering (the "PROSPECTUS"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
or (2) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or such other securities, in cash or
otherwise. The first sentence of this paragraph shall not apply to (a)
transactions relating to shares of Common Stock or other securities acquired in
open market transactions after the completion
of the Public Offering, (b) transfers of shares of Common Stock or any security
convertible into Common Stock as a bona fide gift or gifts, (c) transfers of
shares of Common Stock or any security convertible into Common Stock to any
trust for the direct or indirect benefit of the undersigned or a member of the
"immediate family" (i.e. any relationship by blood, marriage or adoption, not
more remote that first cousin) of the undersigned not involving a disposition
for value, and (d) distributions of shares of Common Stock or any security
convertible into Common Stock to limited partners or stockholders of the
undersigned; provided that in the case of any transfer or distribution pursuant
to clause (b), (c) or (d), (i) each donee, trustee or distributee shall execute
and deliver to Xxxxxx Xxxxxxx a duplicate form of this Lock-up Letter and (ii)
no filing by any party (donor, donee, trustee, beneficiary, transferor or
transferee) under Section 16(a) of the Securities Exchange Act of 1934, as
amended, shall be required or shall be made voluntarily in connection with such
transfer or distribution (other than a filing on a Form 5 made after the
expiration of the 90-day period referred to above). In addition, the undersigned
agrees that, without the prior written consent of Xxxxxx Xxxxxxx on behalf of
the Underwriters, it will not, during the period commencing on the date hereof
and ending 90 days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock. The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of the undersigned's share of Common Stock except in compliance with
the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
Public Offering. The undersigned further understands that this Lock-Up Agreement
is irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
This Lock-up Agreement shall automatically terminate upon the earliest to
occur, if any, of: (a) either Xxxxxx Xxxxxxx or the Company advising the other
party in writing, prior to the execution of the Underwriting Agreement, that it
has determined not to proceed with the Public Offering, (b) termination of the
Underwriting Agreement before the sale of any Shares to the Underwriters, or (c)
June 1, 2003, in the event that the Underwriting Agreement has not been executed
by that date.
Very truly yours,
------------------------------------
(Name)
------------------------------------
(Address)
