EXHIBIT 2
ILEX Oncology, Inc.
6,000,000 Shares
Common Stock
($0.01 Par Value)
UNDERWRITING AGREEMENT
July 30, 2003
UNDERWRITING AGREEMENT
July 30, 2003
UBS Securities LLC
Xxxxxx Brothers
CIBC World Markets Corp.
U.S. Bancorp Xxxxx Xxxxxxx Inc.
As Representative of the several Underwriters
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
ILEX Oncology, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to the Underwriters named in Schedule A annexed
hereto (the "Underwriters"), for whom you are acting as representative(s), an
aggregate of 5,500,000 shares of Common Stock, $0.01 par value per share (the
"Common Stock"), of the Company, and the Cancer Therapy and Research Center
Endowment, a non-profit Texas corporation (the "Selling Stockholder"), proposes
to sell to the several Underwriters 500,000 shares of Common Stock (said shares
to be issued and sold by the Company and to be sold by the Selling Stockholder
collectively, the "Firm Shares"). In addition, solely for the purpose of
covering over-allotments, the Company proposes to grant to the Underwriters the
option to purchase from the Company up to an additional 825,000 shares of Common
Stock, and the Selling Stockholder proposes to grant to the Underwriters the
option to purchase up to an additional 75,000 shares of Common Stock (the
900,000 shares of Common Stock subject to such options being referred to herein
as the "Additional Shares"). The Firm Shares and the Additional Shares are
hereinafter collectively sometimes referred to as the "Shares." The Shares are
described in the Prospectus which is referred to below. The Company and the
Selling Stockholder are hereinafter sometimes referred to as the "Sellers."
The Company has prepared and filed, in accordance with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations thereunder (collectively, the "Act"), with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(File No. 333-106735) under the Act (the "registration statement"). Amendments
to such registration statement, if necessary or appropriate, have been similarly
prepared and filed with the Commission. Such registration statement, as so
amended, has
been declared by the Commission to be effective under the Act. The Company has
filed with the Commission a Prepricing Prospectus (as defined and referred to
below) pursuant to Rule 424(a) under the Act, describing the Shares and the
offering thereof, in such form as has been provided to or discussed with, and
approved by, the Underwriters. The Company will next file with the Commission
pursuant to Rule 424(b) under the Act a final prospectus supplement to the basic
prospectus included within the registration statement, describing the Shares and
the offering thereof, in such form as has been provided to or discussed with,
and approved, by the Underwriters.
The term "Registration Statement" as used in this Agreement
means the registration statement, as amended at the time it became effective and
as supplemented or amended prior to the execution of this Agreement, including
(i) all financial schedules and exhibits thereto and (ii) all documents
incorporated by reference or deemed to be incorporated by reference therein. If
an abbreviated registration statement is prepared and filed with the Commission
in accordance with Rule 462(b) under the Act (an "Abbreviated Registration
Statement"), the term "Registration Statement" includes the Abbreviated
Registration Statement. The term "Basic Prospectus" as used in this Agreement
means the basic prospectus dated as of July 29, 2003 and filed with the
Commission on July 30, 2003 pursuant to Rule 424(b). The term "Prepricing
Prospectus" as used in this Agreement means any form of preliminary prospectus
used in connection with the marketing of the Shares, including the preliminary
prospectus supplement dated as of July 21, 2003 and filed with the Commission on
July 21, 2003 pursuant to Rule 424(a) under the Act and any basic prospectus
(whether or not in preliminary form) used with any such preliminary prospectus
supplement in connection with the marketing of the Shares, in each case as any
of the foregoing may be amended or supplemented by the Company. The term
"Prospectus Supplement" as used in this Agreement means any final prospectus
supplement specifically relating to the Shares, in the form filed with, or
transmitted for filing to, the Commission pursuant to Rule 424 under the Act.
The term "Prospectus" as used in this Agreement means the Basic Prospectus
together with the Prospectus Supplement, except that if such Basic Prospectus is
amended or supplemented on or prior to the date on which the Prospectus
Supplement was first filed pursuant to Rule 424, the term "Prospectus" shall
refer to the Basic Prospectus as so amended or supplemented and as supplemented
by the Prospectus Supplement. Any reference herein to the registration
statement, the Registration Statement, the Basic Prospectus, any Prepricing
Prospectus, any Prospectus Supplement or the Prospectus shall be deemed to refer
to and include (i) the documents incorporated by reference therein pursuant to
Form S-3 (the "Incorporated Documents") and (ii) the copy of the Registration
Statement, the Basic Prospectus, the Prepricing Prospectus, the Prospectus
Supplement, the Prospectus or the Incorporated Documents filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX"). Any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement, any Prepricing
Prospectus, the Prospectus Supplement or the Prospectus shall be deemed to refer
to and include the filing of any document under the Securities Exchange Act of
1934, as amended, and the rules and
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regulations thereunder (collectively, the "Exchange Act") after the effective
date of the Registration Statement, or the date of the Prospectus, as the case
may be, deemed to be incorporated therein by reference.
The Company, the Selling Stockholder and the Underwriters
agree as follows:
1. Sale and Purchase. Upon the basis of the
representations and warranties and subject to the terms and conditions herein
set forth, the Company agrees to issue and sell to the respective Underwriters,
and each of the Underwriters, severally and not jointly, agrees to purchase from
the Company, at a purchase price of $15.98 per share (the "Purchase Price Per
Share"), the number of Firm Shares which bears the same proportion to the
aggregate number of Firm Shares to be issued and sold by the Company as the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule A attached hereto (or such number of Firm Shares increased as set forth
in Section 8 hereof) bears to the aggregate number of Firm Shares to be sold by
the Sellers, subject to such adjustments as you may determine to avoid
fractional shares.
Upon the basis of the representations and warranties and
subject to the terms and conditions herein set forth, the Selling Stockholder
agrees to sell to the respective Underwriters, and each of the Underwriters,
severally and not jointly, agrees to purchase from the Selling Stockholder, at
the Purchase Price Per Share, the number of Firm Shares which bears the same
proportion to the aggregate number of Firm Shares to be sold by the Selling
Stockholder as the number of Firm Shares set forth opposite the name of such
Underwriter in Schedule A attached hereto (or such number of Firm Shares
increased as set forth in Section 8 hereof) bears to the aggregate number of
Firm Shares to be sold by the Sellers, subject to such adjustments as you may
determine to avoid fractional shares.
The Company and the Selling Stockholder are advised by you
that the Underwriters intend (i) to make a public offering of their respective
portions of the Firm Shares as soon after the effectiveness of this Agreement as
in your judgment is advisable and (ii) initially to offer the Firm Shares upon
the terms set forth in the Prospectus. You may from time to time increase or
decrease the public offering price after the initial public offering to such
extent as you may determine.
In addition, the Company and the Selling Stockholder hereby
grant to the several Underwriters the option to purchase, and upon the basis of
the representations and warranties and subject to the terms and conditions
herein set forth, the Underwriters shall have the right to purchase, severally
and not jointly, from the Company and the Selling Stockholder, all or a portion
of the Additional Shares as may be necessary to cover over-allotments made in
connection with the offering of the Firm Shares, at the Purchase Price Per
Share. This option may be exercised by UBS Securities LLC ("UBS Securities") on
behalf of the several Underwriters at any time and from time to time on or
before the thirtieth day following the date of the Prospectus, by written notice
to the Company and the Selling
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Stockholder. Such notice shall set forth the aggregate number of Additional
Shares as to which the option is being exercised, and the date and time when the
Additional Shares are to be delivered (such date and time being herein referred
to as the "additional time of purchase"); provided, however, that the additional
time of purchase shall not be earlier than the time of purchase (as defined
below) nor earlier than the second business day(1) after the date on which the
option shall have been exercised nor later than the tenth business day after the
date on which the option shall have been exercised. The maximum number of
Additional Shares subject to sale by each of the Company and the Selling
Stockholder shall be as set forth in the first paragraph of this Agreement. If
the Underwriters exercise their over-allotment option for less than the total
number of Additional Shares subject to sale thereunder, the Additional Shares
shall be sold by the Company and the Selling Stockholder pro rata in accordance
with the number of Firm Shares to be sold by each of them. Upon any exercise of
the over-allotment option, each Underwriter, severally and not jointly, agrees
to purchase (i) from the Company the number of Additional Shares which bears the
same proportion to the number of Additional Shares to be issued and sold by the
Company upon such exercise as the number of Firm Shares set forth opposite the
name of such Underwriter in Schedule A attached hereto (or such number of Firm
Shares increased as set forth in Section 8 hereof) bears to the aggregate number
of Firm Shares to be sold by the Sellers, and (ii) from the Selling Stockholder
the number of Additional Shares which bears the same proportion to the number of
Additional Shares to be sold by the Selling Stockholder upon such exercise as
the number of Firm Shares set forth opposite the name of such Underwriter in
Schedule A attached hereto (or such number of Firm Shares increased as set forth
in Section 8 hereof) bears to the aggregate number of Firm Shares to be sold by
the Sellers, subject, in the case of clauses (i) and (ii) above, to such
adjustments as you may determine to avoid fractional shares.
2. Payment and Delivery. Payment of the purchase price
for the Firm Shares shall be made to the Company and the Selling Stockholder by
Federal Funds wire transfer, against delivery of the certificates for the Firm
Shares to you through the facilities of The Depository Trust Company ("DTC") for
the respective accounts of the Underwriters. Such payment and delivery shall be
made at 10:00 A.M., New York City time, on August 4, 2003 (unless another time
shall be agreed to by you and the Company and the Selling Stockholder or unless
postponed in accordance with the provisions of Section 8 hereof). The time at
which such payment and delivery are to be made is hereinafter sometimes called
the "time of purchase." Electronic transfer of the Firm Shares shall be made to
you at the time of purchase in such names and in such denominations as you shall
specify at least one full business day prior to the time of purchase.
------------------------------
(1) As used herein "business day" shall mean any day on which the New York
Stock Exchange is open for trading.
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Payment of the purchase price for the Additional Shares shall
be made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Electronic transfer of the Additional
Shares shall be made to you at the additional time of purchase in such names and
in such denominations as you shall specify at least one full business day prior
to the time of purchase.
Deliveries of the documents described in Section 6 hereof with
respect to the purchase of the Shares shall be made at the offices of Xxxxx
Xxxxxxxxxx LLP, 1301 Avenue of the Americas, New York, New York at 9:00 A.M.,
New York City time, on the date of the closing of the purchase of the Firm
Shares or the Additional Shares, as the case may be.
3. Representations and Warranties of the Company and the
Selling Stockholder.
(i) The Company represents and warrants to and
agrees with each of the Underwriters that:
(a) the Registration Statement has been declared
effective under the Act; no stop order of the Commission preventing or
suspending the use of the Basic Prospectus, any Prepricing Prospectus,
the Prospectus Supplement or the Prospectus or the effectiveness of the
Registration Statement has been issued and no proceedings for such
purpose have been instituted or, to the Company's knowledge after
inquiry of appropriate personnel at the Commisssion, are contemplated
by the Commission; the Company is eligible to use Form S-3; such
registration statement at the date of this Agreement meets, and the
offering of the Shares complies in all material respects with, the
requirements of Rule 415 under the Act. The Registration Statement
complied when it became effective, complies and will comply, at the
time of purchase, and the Basic Prospectus, any Prepricing Prospectus,
the Prospectus Supplement and the Prospectus conformed as of its date,
conform and will conform at the time of purchase in all material
respects with the requirements of the Act (including said Rule 415);
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
have been and will be so described or filed; the conditions to the use
of Form S-3 have been satisfied; and the Registration Statement did not
at the time of effectiveness, does not and will not at the time of
purchase 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, and the Basic Prospectus,
any Prepricing Prospectus, the Prospectus Supplement and the Prospectus
did not as of its date, does not and will not at the time of purchase
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 light of the circumstances under which they were
made, not misleading; provided, however,
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that the Company makes no warranty or representation with respect to
any statement contained in the Registration Statement or the Prospectus
in reliance upon and in conformity with information concerning an
Underwriter and furnished in writing by or on behalf of such
Underwriter through you to the Company expressly for use in the
Registration Statement or the Prospectus; the documents incorporated by
reference in the Basic Prospectus, any Prepricing Prospectus, the
Prospectus Supplement, the Registration Statement and the Prospectus,
at the time they became effective or were filed with the Commission,
complied in all material respects with the requirements of the Exchange
Act and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading; and the Company has not distributed and
will not distribute any offering material in connection with the
offering or sale of the Shares other than the Registration Statement,
any Prepricing Prospectus, the then most recent Prospectus Supplement
and the Prospectus;
(b) as of the date of this Agreement, the Company has an
authorized and outstanding capitalization as set forth in the section
of the Registration Statement and the Prospectus entitled
"Capitalization" and, as of the time of purchase and the additional
time of purchase, as the case may be, the Company shall have an
authorized and outstanding capitalization as set forth in the section
of the Registration Statement and the Prospectus entitled
"Capitalization"(subject, in each case, to the issuance of shares of
Common Stock upon exercise of stock options and warrants disclosed as
outstanding in the Registration Statement and the Prospectus and grant
of options under existing stock option plans described in the
Registration Statement and the Prospectus, and subject, in the case of
additional time of purchase, to the issuance of Additional Shares); all
of the issued and outstanding shares of capital stock, including the
Common Stock, of the Company have been duly authorized and validly
issued and are fully paid and non-assessable, have been issued in
compliance with all federal and state securities laws and were not
issued in violation of any preemptive right, resale right, right of
first refusal or similar right;
(c) 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 full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement and the Prospectus, to execute and deliver this
Agreement and to issue, sell and deliver the Shares as contemplated
herein;
(d) the Company is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction where
the ownership or
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leasing of its properties or the conduct of its business requires such
qualification (such jurisdictions consisting solely of the state of
Texas), except where the failure to be so qualified and in good
standing could not reasonably be expected, individually or in the
aggregate, to have a material adverse effect on the business,
properties, financial condition, results of operation or prospects of
the Company and the Subsidiaries (as hereinafter defined) taken as a
whole ("Material Adverse Effect");
(e) the Company has no subsidiaries (as defined in the
Act) other than those listed on Schedule B (collectively, the
"Subsidiaries"); the Company owns, directly or indirectly, all of the
issued and outstanding capital stock or other equity interests of each
of the Subsidiaries; other than the capital stock or other equity
interests of the Subsidiaries, the Company does not own, directly or
indirectly, any shares of stock or any other equity or long-term debt
securities (except for corporate bonds held for investment purposes
which are reflected specifically or generally as an asset on the
Company's financial statements) of any corporation or have any equity
interest in any firm, partnership, joint venture, association or other
entity; complete and correct copies of the certificates of
incorporation and the by-laws of the Company and the Subsidiaries and
all amendments thereto have been delivered or made available to you,
and except as set forth in the exhibits to the Registration Statement
no changes therein will be made subsequent to the date hereof and prior
to the time of purchase or, if later, the additional time of purchase;
each Subsidiary has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, with full corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Registration Statement and the Prospectus; each Subsidiary is duly
qualified to do business as a foreign corporation and is in good
standing in each jurisdiction where the ownership or leasing of its
properties or the conduct of its business requires such qualification
(such jurisdictions consisting solely of those set forth adjacent to
the respective Subsidiaries' names on Schedule B), except where the
failure to be so qualified and in good standing could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect; all of the outstanding shares of capital stock and other equity
interests of each of the Subsidiaries have been duly authorized and
validly issued, are fully paid and non-assessable and, except as set
forth in the Registration Statement and the Prospectus, are owned by
the Company subject to no security interest, other encumbrance or
adverse claims; and no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligation into shares of capital stock or ownership interests in the
Subsidiaries are outstanding;
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(f) the Shares have been duly and validly authorized and,
when issued and delivered against payment therefor as provided herein,
will be duly and validly issued, fully paid and non-assessable and free
of statutory and contractual preemptive rights, resale rights, rights
of first refusal and similar rights;
(g) the capital stock of the Company, including the
Shares, conforms in all material respects to the description thereof
incorporated by reference in the Registration Statement and the
Prospectus, and the certificates for the Shares are in due and proper
form and the holders of the Shares will not be subject to personal
liability by reason of being such holders;
(h) this Agreement has been duly authorized, executed and
delivered by the Company;
(i) except with respect to breaches, violations or
defaults that could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect, neither the Company nor
any of the Subsidiaries is in breach or violation of or in default
under (nor has any event occurred which with notice, lapse of time or
both would result in any breach or violation of, constitute a default
under or give the holder of any indebtedness (or a person acting on
such holder's behalf) the right to require the repurchase, redemption
or repayment of all or a part of such indebtedness under) its
respective charter or by-laws, or any indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness,
or any license, lease, contract or other agreement or instrument to
which the Company or any of the Subsidiaries is a party or by which any
of them or any of their properties may be bound or affected, and the
execution, delivery and performance of this Agreement, the issuance and
sale of the Shares and the consummation of the transactions
contemplated hereby will not conflict with, result in any breach or
violation of or constitute a default under (nor constitute any event
which with notice, lapse of time or both would result in any breach or
violation of or constitute a default under) the charter or by-laws of
the Company or any of the Subsidiaries, or any indenture, mortgage,
deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or any license, lease, contract or other agreement or
instrument to which the Company or any of the Subsidiaries is a party
or by which any of them or any of their respective properties may be
bound or affected, or any federal, state, local or foreign law,
regulation or rule or any decree, judgment or order applicable to the
Company or any of the Subsidiaries;
(j) no approval, authorization, consent or order of or
filing with any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency is required in
connection with the issuance and sale of the Shares or the consummation
by the Company of the transactions contemplated hereby other than
registration of the Shares under the Act, which has been or will
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be effected, any necessary qualification under the securities or blue
sky laws of the various jurisdictions in which the Shares are being
offered by the Underwriters or under the rules and regulations of the
NASD, or those that if not obtained, made or waived could not
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect;
(k) except as set forth in the Registration Statement and
the Prospectus, (i) no person has the right, contractual or otherwise,
to cause the Company to issue or sell to it any shares of Common Stock
or shares of any other capital stock or other equity interests of the
Company, (ii) no person has any preemptive rights, resale rights,
rights of first refusal or other rights to purchase any shares of
Common Stock or shares of any other capital stock or other equity
interests of the Company, and (iii) no person has the right to act as
an underwriter or as a financial advisor to the Company in connection
with the offer and sale of the Shares, in the case of each of the
foregoing clauses (i), (ii) and (iii), whether as a result of the
filing or effectiveness of the Registration Statement or the sale of
the Shares as contemplated thereby or otherwise; no person has the
right, contractual or otherwise, to cause the Company to register under
the Act any shares of Common Stock or shares of any other capital stock
or other equity interests of the Company, or to include any such shares
or interests in the Registration Statement or the offering contemplated
thereby, whether as a result of the filing or effectiveness of the
Registration Statement or the sale of the Shares as contemplated
thereby or otherwise, the breach of which could reasonably be expected
to have a Material Adverse Effect or to interfere in any material
respect with the completion of the offering and sale of the Shares;
(l) each of the Company and the Subsidiaries has all
necessary licenses, authorizations, consents and approvals and has made
all necessary filings required under any federal, state, local or
foreign law, regulation or rule, and has obtained all necessary
authorizations, consents and approvals from other persons, in order to
conduct its respective business, other than such licenses,
authorizations, consents and approvals the failure of which to obtain
would not, individually or in the aggregate, have a Material Adverse
Effect; neither the Company nor any of the Subsidiaries is in violation
of, or in default under, or has received notice of any proceedings
relating to revocation or modification of, any such license,
authorization, consent or approval or any federal, state, local or
foreign law, regulation or rule or any decree, order or judgment
applicable to the Company or any of the Subsidiaries, except where such
violation, default, revocation or modification would not, individually
or in the aggregate, have a Material Adverse Effect;
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(m) all legal or governmental proceedings, affiliate
transactions, off-balance sheet transactions, contracts, licenses,
agreements, leases or documents of a character required to be described
in the Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement have been so described or filed
as required;
(n) except as disclosed in the Registration Statement and
the Prospectus, there are no pending or, to the Company's knowledge,
threatened actions, suits, proceedings or, to the Company's knowledge,
claims or investigations to which the Company or any of the
Subsidiaries or any of their respective directors or officers is or
would be a party or of which any of their respective properties is or
would be subject at law or in equity, before or by any federal, state,
local or foreign governmental or regulatory commission, board, body,
authority or agency, except any such action, suit, claim, investigation
or proceeding which would not result in a judgment, decree or order
having, individually or in the aggregate, a Material Adverse Effect or
preventing consummation of the transactions contemplated hereby;
(o) Ernst & Young LLP, whose report on the consolidated
financial statements of the Company and the Subsidiaries is filed with
the Commission as part of the Registration Statement and the
Prospectus, are independent public accountants as required by the Act;
(p) the audited financial statements included in the
Registration Statement and the Prospectus, together with the related
notes and schedules, present fairly, in all material respects, the
consolidated financial position of the Company and the Subsidiaries as
of the dates indicated and the consolidated results of operations and
cash flows of the Company and the Subsidiaries for the periods
specified and have been prepared, in all material respects, in
compliance with the requirements of the Act and in conformity with
generally accepted accounting principles applied on a consistent basis
during the periods involved; any pro forma financial statements or data
included in the Registration Statement and the Prospectus comply, in
all material respects, with the requirements of Regulation S-X of the
Act and the assumptions used in the preparation of such pro forma
financial statements and data are reasonable, the pro forma adjustments
used therein are appropriate to give effect to the transactions or
circumstances described therein and the pro forma adjustments have been
properly applied to the historical amounts in the compilation of those
statements and data; the other financial and statistical data set forth
in the Registration Statement and the Prospectus are accurately
presented, in all material respects, and prepared on a basis
consistent, in all material respects, with the financial statements and
books and records of the Company; there are no financial statements
(historical or pro forma) that are required to be included
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in the Registration Statement and the Prospectus that are not included
as required; and the Company and the Subsidiaries do not have any
material liabilities or obligations, direct or contingent (including
any off-balance sheet obligations), not disclosed in the Registration
Statement and the Prospectus;
(q) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
there has not been (i) any material adverse change, or any development
which could reasonably be expected to cause a material adverse change,
in the business, properties, management, financial condition or results
of operations of the Company and the Subsidiaries taken as a whole,
(ii) any transaction which is material to the Company and the
Subsidiaries taken as a whole, (iii) any obligation, direct or
contingent (including any off-balance sheet obligations), incurred by
the Company or the Subsidiaries, which is material to the Company and
the Subsidiaries taken as a whole, (iv) any material change in the
capital stock or outstanding indebtedness of the Company or the
Subsidiaries or (v) any dividend or distribution of any kind declared,
paid or made on the capital stock of the Company;
(r) the Company has obtained for the benefit of the
Underwriters the agreement (a "Lock-Up Agreement"), in the form set
forth as Exhibit A hereto, of each of its directors and executive
officers;
(s) neither the Company nor any of the Subsidiaries is
and, after giving effect to the offering and sale of the Shares, will
not be an "investment company" or an entity "controlled" by an
"investment company," as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(t) the Company and each of the Subsidiaries has good and
indefeasible title to all property (real and personal) described in the
Registration Statement and in the Prospectus as being owned by each of
them, free and clear of all liens, claims, security interests or other
encumbrances, except such as could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect;
all the property described in the Registration Statement and the
Prospectus as being held under lease by the Company or a Subsidiary is
held thereby 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
or any of the Subsidiaries, as the case may be;
(u) the Company or the Subsidiaries own, or have obtained
valid and enforceable licenses for, or other rights to use, the
inventions, patent applications, patents, trademarks (both registered
and unregistered), tradenames, copyrights,
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trade secrets and other proprietary information described in the
Registration Statement and the Prospectus as being owned or licensed by
them or which are necessary for the conduct of their respective
businesses and the commercialization of the products and product
candidates described in the Registration Statement and the Prospectus,
except where the failure to own, license or have such rights would not,
individually or in the aggregate, have a Material Adverse Effect
(collectively, "Intellectual Property"); except as described in the
Registration Statement and the Prospectus or as would not have a
Material Adverse Effect, (i) to the Company's knowledge, there are no
third parties who have or will be able to establish rights to any
Intellectual Property, except for the ownership rights of the owners of
the Intellectual Property which is licensed or otherwise contractually
available to the Company; (ii) to the Company's knowledge, there is no
infringement by third parties of any Intellectual Property; (iii) there
is no pending or, to the Company's knowledge, threatened action, suit,
proceeding or , to the Company's knowledge, claim by others challenging
the Company's rights in or to any Intellectual Property; (iv) there is
no pending or, to the Company's knowledge, threatened action, suit,
proceeding or, to the Company's knowledge, claim by others challenging
the validity or scope of any Intellectual Property, and the Company is
unaware of any facts which could form a reasonable basis for any such
claim; (v) there is no pending or, to the Company's knowledge,
threatened action, suit, proceeding or, to the Company's knowledge,
claim by others that the Company infringes or otherwise violates (or
would infringe or violate, upon commercialization of the products and
product candidates described in the Registration Statement and
Prospectus) any patent, trademark, copyright, trade secret or other
proprietary rights of others, and the Company is unaware of any facts
which could form a reasonable basis for any such claim; (vi) to the
Company's knowledge, there is no patent or patent application that
contains claims that interfere with the issued or pending claims of any
of the Intellectual Property; and (vii) to the Company's knowledge,
there is no prior art that may render any patent application owned by
the Company of the Intellectual Property unpatentable that has not been
disclosed to the U.S. Patent and Trademark Office;
(v) neither the Company nor any of the Subsidiaries is
engaged in any unfair labor practice; except for matters which would
not, individually or in the aggregate, have a Material Adverse Effect,
(i) there is (A) no unfair labor practice complaint pending or, to the
Company's knowledge after due inquiry, threatened against the Company
or any of the Subsidiaries before the National Labor Relations Board,
and no grievance or arbitration proceeding arising out of or under
collective bargaining agreements is pending or threatened, (B) no
strike, labor dispute, slowdown or stoppage pending or, to the
Company's knowledge after due inquiry, threatened against the Company
or any of the Subsidiaries and (C) no union representation dispute
currently existing concerning the employees of the Company
12
or any of the Subsidiaries, and (ii) to the Company's knowledge after
due inquiry, (A) no union organizing activities are currently taking
place concerning the employees of the Company or any of the
Subsidiaries and (B) there has been no violation of any federal, state,
local or foreign law relating to discrimination in the hiring,
promotion or pay of employees, any applicable wage or hour laws or any
provision of the Employee Retirement Income Security Act of 1974
("ERISA") or the rules and regulations promulgated thereunder
concerning the employees of the Company or any of the Subsidiaries;
(w) the Company and the Subsidiaries and their
properties, assets and operations are in compliance with, and hold all
permits, authorizations and approvals required under, Environmental
Laws (as defined below), except to the extent that failure to so comply
or to hold such permits, authorizations or approvals would not,
individually or in the aggregate, have a Material Adverse Effect; to
the Company's knowledge, there exist no conditions, circumstances,
activities, practices, actions, omissions or plans that could
reasonably be expected to give rise to any material costs or
liabilities to the Company or the Subsidiaries under, or to interfere
with or prevent compliance by the Company or the Subsidiaries with,
Environmental Laws; except as would not, individually or in the
aggregate, have a Material Adverse Effect, neither the Company nor any
of the Subsidiaries (i) to the Company's knowledge, is the subject of
any investigation, (ii) has received any notice or claim, (iii) is a
party to or, to the Company's knowledge, affected by any pending or, to
the Company's knowledge, threatened action, suit or proceeding, (iv) is
bound by any judgment, decree or order or (v) has entered into any
agreement, in each case relating to any alleged violation of any
Environmental Law or any actual or alleged release or threatened
release or cleanup at any location of any Hazardous Materials (as
defined below) (as used herein, "Environmental Law" means any federal,
state, local or foreign law, statute, ordinance, rule, regulation,
order, decree, judgment, injunction, permit, license, authorization or
other binding requirement, or common law, relating to health, safety or
the protection, cleanup or restoration of the environment or natural
resources, including those relating to the distribution, processing,
generation, treatment, storage, disposal, transportation, other
handling or release or threatened release of Hazardous Materials, and
"Hazardous Materials" means any material (including, without
limitation, pollutants, contaminants, hazardous or toxic substances or
wastes) that is regulated by or may give rise to liability under any
Environmental Law);
(x) in the ordinary course of its business, the Company
and each of the Subsidiaries conducts a periodic review of the effect
of the Environmental Laws on its business, operations and properties,
in the course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for cleanup, closure of properties or compliance
13
with the Environmental Laws or any permit, license or approval, any
related constraints on operating activities and any potential
liabilities to third parties);
(y) all tax returns required to be filed by the Company
and each of the Subsidiaries have been filed, and all taxes and other
assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties
applicable thereto due or claimed to be due from such entities have
been paid to the extent the same have become due, other than those
being contested in good faith and for which adequate reserves have been
provided;
(z) the Company and each of the Subsidiaries maintains
insurance covering its properties, operations, personnel and businesses
as the Company deems adequate in its reasonable business judgment; such
insurance insures against such losses and risks to an extent which is
adequate in accordance with customary industry practice in the business
that they are engaged to protect the Company and the Subsidiaries and
their businesses; all such insurance is fully in force on the date
hereof and will be fully in force at the time of purchase and any
additional time of purchase;
(aa) neither the Company nor any of the Subsidiaries has
sustained since the date of the last audited financial statements
included in the Registration Statement and the Prospectus any material
loss or interference with its respective 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;
(bb) the Company has not sent or received any
communication regarding termination of, or intent not to renew, any of
the contracts or agreements referred to or described in, or filed as an
exhibit to, the Registration Statement, and no such termination or
non-renewal has been threatened by the Company or, to the Company's
knowledge after due inquiry, any other party to any such contract or
agreement;
(cc) the Company and each of the Subsidiaries maintains a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (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
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences;
14
(dd) the Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 and
15d-14 under the Exchange Act); such disclosure controls and procedures
are designed to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to the
Company's Chief Executive Officer and its Chief Financial Officer by
others within those entities, and such disclosure controls and
procedures are effective to perform the functions for which they were
established and were found to be effective during the review most
recently conducted; the Company's auditors and the Audit Committee of
the Board of Directors have been advised of: (i) any significant
deficiencies in the design or operation of internal controls which
could adversely affect the Company's ability to record, process,
summarize, and report financial data; and (ii) any fraud, whether or
not material, that involves management or other employees who have a
role in the Company's internal controls; any material weaknesses in
internal controls have been identified for the Company's auditors; and
since the date of the most recent evaluation of such disclosure
controls and procedures, there have been no significant changes in
internal controls or in other factors that could significantly affect
internal controls, including any corrective actions with regard to
significant deficiencies and material weaknesses;
(ee) except as permitted by applicable securities laws,
since July 30, 2002, the Company has not, directly or indirectly,
including through any Subsidiary: (i) extended credit, arranged to
extend credit, or renewed any extension of credit, in the form of a
personal loan, to or for any director or executive officer of the
Company, or to or for any family member or affiliate of any director or
executive officer of the Company; or (ii) made any material
modification, including any renewal thereof, to any term of any
personal loan to any director or executive officer of the Company, or
any family member or affiliate of any director or executive officer,
which loan was outstanding on July 30, 2002;
(ff) any statistical and market-related data included in
the Registration Statement and the Prospectus are based on or derived
from sources that the Company believes to be reliable and accurate in
all material respects, and the Company has obtained the written consent
to the use of such data from such sources to the extent required;
(gg) neither the Company nor any of the Subsidiaries nor,
to the Company's knowledge after due inquiry, any employee or agent of
the Company or the Subsidiaries has made any payment of funds of the
Company or the Subsidiaries or received or retained any funds in
violation of any law, rule or regulation, which payment, receipt or
retention of funds is of a character required to be disclosed in the
Registration Statement or the Prospectus;
15
(hh) neither the Company nor any of the Subsidiaries nor
any of their respective directors, officers, affiliates or controlling
persons has taken, directly or indirectly, any action designed, or
which has constituted or might reasonably be expected to cause or
result in, under the Exchange Act or otherwise, the stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares;
(ii) to the Company's knowledge, there are no affiliations
or associations between any member of the NASD and any of the Company's
officers, directors or 5% or greater security holders, except as set
forth in the Registration Statement and the Prospectus; and
(jj) except to the extent disclosed in the Registration
Statement and the Prospectus and except as would not be expected to
have a Material Adverse Effect, the Company has operated and currently
is in compliance in all material respects with all applicable rules,
regulations and policies of the U.S. Food and Drug Administration and
comparable drug regulatory agencies outside of the United States
(collectively, the "Regulatory Authorities"); and except to the extent
disclosed in the Registration Statement and the Prospectus, the Company
has not received any notices or other correspondence from the
Regulatory Authorities or any other governmental agency requiring the
termination, suspension or modification of any clinical or pre-clinical
studies or tests that are described in the Prospectus or the results of
which are referred to in the Prospectus.
In addition, any certificate signed by any officer of the
Company or any of the Subsidiaries and delivered to the Underwriters or counsel
for the Underwriters in connection with the offering of the Shares shall be
deemed to be a representation and warranty by the Company or Subsidiary, as the
case may be, as to matters covered thereby, to each Underwriter.
(ii) The Selling Stockholder represents and
warrants to and agrees with each of the Underwriters that:
(a) the Selling Stockholder now is and at the time of
delivery of such Shares (whether the time of purchase or additional
time of purchase, as the case may be) will be, the lawful owner of the
number of Shares to be sold by the Selling Stockholder pursuant to this
Agreement and has and, at the time of delivery thereof, will have valid
and indefeasible title to such Shares, and upon delivery of and payment
for such Shares (whether at the time of purchase or the additional time
of purchase, as the case may be), the Underwriters will acquire valid
and indefeasible title to such Shares free and clear of any claim,
lien, encumbrance, security interest, community property right,
restriction on transfer or other defect in title;
16
(b) the Selling Stockholder has and at the time of
delivery of such Shares (whether the time of purchase or additional
time of purchase, as the case may be) will have, full legal right,
power and capacity, and any approval required by law (other than those
imposed by the Act and the securities or blue sky laws of certain
jurisdictions), to sell, assign, transfer and deliver such Shares in
the manner provided in this Agreement;
(c) this Agreement has been duly executed and delivered
by the Selling Stockholder and is a legal, valid and binding agreement
of the Selling Stockholder enforceable in accordance with its terms
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or
affecting creditor's rights generally, or by general equitable
principles (regardless of whether such enforceability is considered in
a proceeding at law or in equity);
(d) when the Registration Statement becomes effective and
at all times subsequent thereto through the latest of the time of
purchase, additional time of purchase or the termination of the
offering of the Shares, the Registration Statement and Prospectus, and
any supplements or amendments thereto, as the same relate to the
Selling Stockholder, 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 (i) in the case of the Registration
Statement, not misleading, and (ii) in the case of the Prospectus, in
light of the circumstances upon which they were made, not misleading.
In addition, to the Selling Stockholder's knowledge, when the
Registration Statement becomes effective and at all times subsequent
thereto through the latest of the time of purchase, additional time of
purchase or the termination of the offering of the Shares, the
Registration Statement and Prospectus, and any supplements or
amendments thereto, 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 (i) in the case of the Registration
Statement, not misleading, and (ii) in the case of the Prospectus, in
light of the circumstances upon which they were made, not misleading;
and
(e) the sale of the Selling Stockholder's Shares pursuant
to this Agreement is not prompted by any information concerning the
Company which is not set forth in the Prospectus.
4. Certain Covenants of the Company and the
Selling Stockholder.
(i) The Company hereby agrees (and with respect to
Section 4(i)(n)(x), the Selling Stockholder hereby agrees):
(a) to furnish such information as may be required and
otherwise to cooperate in qualifying the Shares for offering and sale
under the securities or blue
17
sky laws of such states or other jurisdictions as you may designate and
to maintain such qualifications in effect so long as you may request
for the distribution of the Shares; provided that the Company shall not
be required to qualify as a foreign corporation or to consent to the
service of process under the laws of any such jurisdiction (except
service of process with respect to the offering and sale of the
Shares); and to promptly advise you of the receipt by the Company of
any notification with respect to the suspension of the qualification of
the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York
City, as soon as practicable after this Agreement becomes effective,
and thereafter from time to time to furnish to the Underwriters, as
many copies of the Prospectus (or of the Prospectus as amended or
supplemented if the Company shall have made any amendments or
supplements thereto after the effective date of the Registration
Statement) as the Underwriters may request for the purposes
contemplated by the Act; in case any Underwriter is required to deliver
a prospectus after the nine-month period referred to in Section
10(a)(3) of the Act in connection with the sale of the Shares, the
Company will prepare, at its expense, promptly upon request such
amendment or amendments to the Registration Statement and the
Prospectus as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the Act;
(c) if, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a post
effective amendment thereto be declared effective before the Shares
maybe sold, the Company will endeavor to cause the Registration
Statement or such post effective amendment to become effective as soon
as possible and the Company will advise you promptly and, if requested
by you, will confirm such advice in writing, (i) when the Registration
Statement and any post-effective amendment thereto has become
effective, and (ii) if Rule 430A under the Act is used, when the
Prospectus is filed with the Commission pursuant to Rule 424(b) under
the Act (which the Company agrees to file in a timely manner under such
Rule);
(d) to advise you promptly, confirming such advice in
writing, of any request by the Commission for amendments or supplements
to the Registration Statement or the Prospectus or for additional
information with respect thereto, or of notice of institution of
proceedings for, or the entry of a stop order, suspending the
effectiveness of the Registration Statement and, if the Commission
should enter a stop order suspending the effectiveness of the
Registration Statement, to use its best efforts to obtain the lifting
or removal of such order as soon as possible; to advise you promptly of
any proposal to amend or supplement the Registration Statement
18
or the Prospectus, including by filing any documents that would be
incorporated therein by reference, and to provide you and Underwriters'
counsel copies of any such documents for review and comment a
reasonable amount of time prior to any proposed filing and to file no
such amendment or supplement to which you shall object in writing;
(e) subject to Section 4(d) hereof, to file promptly all
reports and any definitive proxy or information statement required to
be filed by the Company with the Commission in order to comply with the
Exchange Act subsequent to the date of the Prospectus and for so long
as the delivery of a prospectus is required in connection with the
offering or sale of the Shares; and to provide you with a copy of such
reports and statements and other documents to be filed by the Company
pursuant to Section 13, 14 or 15(d) of the Exchange Act during such
period a reasonable amount of time prior to any proposed filing, and to
promptly notify you of such filing;
(f) if necessary or appropriate, to file a registration
statement pursuant to Rule 462(b) under the Act;
(g) to advise the Underwriters promptly of the happening
of any event known to the Company within the time during which a
prospectus relating to the Shares is required to be delivered under the
Act which could require the making of any change in the Prospectus then
being used so that the Prospectus would not include an untrue statement
of material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
are made, not misleading, and, during such time, subject to Section
4(d) hereof, to prepare and furnish, at the Company's expense, to the
Underwriters promptly such amendments or supplements to such Prospectus
as may be necessary to reflect any such change;
(h) to make generally available to its security holders,
and to deliver to you an earnings statement of the Company (which will
satisfy the provisions of Section 11(a) of the Act and, in the case of
quarterly financial statements, need not be audited) covering a period
of twelve months beginning after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Act) as soon as is
reasonably practicable after the termination of such twelve-month
period but not later than November 14, 2004;
(i) to furnish to its shareholders as soon as practicable
after the end of each fiscal year an annual report (including a
consolidated balance sheet and statements of income, shareholders'
equity and cash flow of the Company and the Subsidiaries for such
fiscal year, accompanied by a copy of the certificate or report thereon
of nationally recognized independent certified public accountants);
19
(j) to furnish to you 5 copies of the Registration
Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto and documents
incorporated by reference therein) and sufficient copies of the
foregoing (other than exhibits) for distribution of a copy to each of
the other Underwriters;
(k) to furnish to you promptly and, upon request, to each
of the other Underwriters for a period of five years from the date of
this Agreement (i) copies of any reports, proxy statements, or other
communications which the Company shall send to its stockholders or
shall from time to time publish or publicly disseminate, (ii) copies of
all annual, quarterly and current reports filed with the Commission on
Forms 10-K, 10-Q and 8-K, or such other similar forms as may be
designated by the Commission, (iii) copies of documents or reports
filed with any national securities exchange on which any class of
securities of the Company is listed, and (iv) such other information as
you may reasonably request regarding the Company or the Subsidiaries;
(l) to furnish to you as early as practicable prior to
the time of purchase and any additional time of purchase, as the case
may be, but not later than two business days prior thereto, a copy of
the latest available unaudited monthly consolidated financial
statements, if any, of the Company and the Subsidiaries which have been
read by the Company's independent certified public accountants, as
stated in their letter to be furnished pursuant to Section 6(d) hereof;
(m) to apply the net proceeds from the sale of the Shares
in the manner set forth under the caption "Use of Proceeds" in the
Prospectus;
(n) to pay or cause to be paid all costs, expenses, fees
and taxes in connection with (i) the preparation and filing of the
Registration Statement, the Basic Prospectus, each Prepricing
Prospectus, each Prospectus Supplement, the Prospectus, and any
amendments or supplements thereto, and the printing and furnishing of
copies of each thereof to the Underwriters and to dealers (including
costs of mailing and shipment); (ii) the registration, issue, sale and
delivery of the Shares including any stock or transfer taxes and stamp
or similar duties payable upon the sale, issuance or delivery of the
Shares to the Underwriters, (iii) the producing, word processing and/or
printing of this Agreement, any Agreement Among Underwriters, any
dealer agreements and any closing documents (including compilations
thereof) and the reproduction and/or printing and furnishing of copies
of each thereof to the Underwriters and (except closing documents) to
dealers (including costs of mailing and shipment); (iv) the
qualification of the Shares for offering and sale under state or
foreign laws and the determination of their eligibility for investment
under state or foreign law as aforesaid (including the legal fees and
filing fees and other disbursements of counsel for the Underwriters)
and
20
the printing and furnishing of copies of any blue sky surveys or legal
investment surveys to the Underwriters and to dealers; (v) any listing
of the Shares on any securities exchange or qualification of the Shares
for quotation on NASDAQ and any registration thereof under the Exchange
Act; (vi) any filing for review of the public offering of the Shares by
the NASD, including the legal fees and filing fees and other
disbursements of counsel to the Underwriters; (vii) the fees and
disbursements of any transfer agent or registrar for the Shares; (viii)
the costs and expenses of the Company relating to presentations or
meetings undertaken in connection with the marketing of the offering
and sale of the Shares to prospective investors and the Underwriters'
sales forces, 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,
travel, lodging and other expenses incurred by the officers of the
Company and any such consultants, and the cost of any aircraft
chartered in connection with the road show in excess of $30,000; (ix)
the performance of the Company's other obligations hereunder, including
without limitation, all expenses and taxes incident to the sale and
delivery of the Shares to the Underwriters hereunder; and (x) any fees
and expenses of counsel for the Selling Stockholder (to be paid by the
Selling Stockholder);
(o) not to sell, offer to sell, contract or agree to
sell, hypothecate, pledge, grant any option to purchase or otherwise
dispose of or agree to dispose of, directly or indirectly, any Common
Stock or securities convertible into or exchangeable or exercisable for
Common Stock or warrants or other rights to purchase Common Stock or
any other securities of the Company that are substantially similar to
Common Stock, or file or cause to be declared effective a registration
statement under the Act relating to the offer and sale of any shares of
Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock or other rights to purchase Common Stock
or any other securities of the Company that are substantially similar
to Common Stock for a period of 90 days after the date hereof (the
"Lock-Up Period"), without the prior written consent of UBS Securities,
except for (i) the registration of the Shares and the sales to the
Underwriters pursuant to this Agreement, (ii) issuances of Common Stock
upon the exercise of options or warrants disclosed as outstanding in
the Registration Statement and the Prospectus, (iii) the issuance of
employee stock options not exercisable during the Lock-Up Period
pursuant to stock option plans described in the Registration Statement
and the Prospectus; and (iv) the issuance of shares of Common Stock to
Millennium Pharmaceuticals, Inc. on the terms described in the
Prospectus;
(p) to use its best efforts to cause the Common Stock to
be listed for quotation on the National Association of Securities
Dealers Automated Quotation National Market System ("NASDAQ"); and
21
(q) to maintain a transfer agent and, if necessary under
the jurisdiction of incorporation of the Company, a registrar for the
Common Stock.
(ii) The Selling Stockholder hereby agrees:
(a) to advise the Underwriters promptly of the happening
of any event within the time during which a prospectus relating to the
Shares is required to be delivered under the Act that is known to the
Selling Stockholder, which, to the knowledge of the Selling Stockholder
after consultation with counsel, would require the making of any change
in the Prospectus then being used, or in the information incorporated
by reference, so that the Prospectus would not include an untrue
statement of material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they are made, not misleading; and
(b) not to sell, offer or agree to sell, contract to
sell, hypothecate, pledge grant any option to sell or otherwise dispose
of, directly or indirectly, any shares of Common Stock or securities
convertible into or exchangeable or exercisable for Common Stock or
warrants or other rights to purchase Common Stock or any such
securities or any other securities of the Company that are
substantially similar to Common Stock, or request or demand the
registration under the Act of any shares of Common Stock or securities
convertible into or exercisable or exchangeable for Common Stock or
other rights to purchase Common Stock or any other securities of the
Company that are substantially similar to Common Stock, during the
Lock-up Period without the prior written consent of UBS Securities LLC,
except the registration of the Shares and the sales to the Underwriters
pursuant to this Agreement.
5. Reimbursement of Underwriters' Expenses. If the
Shares are not delivered for any reason other than the termination of this
Agreement pursuant to clause (y) of the second paragraph of Section 7 hereof or
the fifth paragraph of Section 8 hereof or the default by one or more of the
Underwriters in its or their respective obligations hereunder, the Company
shall, in addition to paying the amounts described in Section 4(i)(n) hereof,
reimburse the Underwriters for all of their reasonable out-of-pocket expenses,
including the reasonable fees and disbursements of their counsel.
6. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties on the part of each of the Company and the
Selling Stockholder on the date hereof, at the time of purchase and, if
applicable, at the additional time of purchase, the performance by each of the
Company and the Selling Stockholder of its obligations hereunder and to the
following additional conditions precedent:
22
(a) The Company shall furnish to you at the time of
purchase and, if applicable, at the additional time of purchase, an
opinion of Fulbright & Xxxxxxxx L.L.P., counsel for the Company,
addressed to the Underwriters, and dated the time of purchase or the
additional time of purchase, as the case may be, with reproduced copies
for each of the other Underwriters and in form and substance
satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters,
stating that:
(i) the Company has been duly incorporated and
is validly existing as a corporation in good standing under
the laws of the State of Delaware, with the requisite
corporate power and authority to own or lease its properties
and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly qualified to do
business as a foreign corporation in the State of Texas;
(ii) Each of ILEX Oncology Services, Inc., ILEX
Products, Inc., ILEX Acquisitions, Inc., ILEX Pharmaceuticals,
L.P. and ILEX Pharmaceuticals, L.L.C. (the "Domestic
Subsidiaries") has been duly organized and is validly existing
and in good standing under the laws of the jurisdiction of
formation with the requisite corporate power and authority to
own or lease its properties and to conduct its business as
described in the Registration Statement and the Prospectus.
ILEX Products, Inc. and ILEX Oncology Services, Inc. are duly
qualified to do business as a foreign corporation in the State
of Texas, ILEX Pharmaceuticals, L.P. is duly qualified to do
business as a foreign limited partnership in the State of
Texas, ILEX Pharmaceuticals, L.L.C. is duly qualified to do
business as a limited liability company in Texas and ILEX
Products, Inc. is duly qualified to do business as a foreign
corporation in the Commonwealth of Massachusetts;
(iii) the Company has authorized and outstanding
capital stock as set forth in the Registration Statement and
the Prospectus under the heading "Capitalization" as of the
date set forth therein. The capital stock of the Company,
including the Shares, conforms as to legal matters in all
material respects to the description thereof contained in the
Registration Statement and the Prospectus. The issued and
outstanding shares of Common Stock have been duly authorized
and validly issued and are fully paid and nonassessable and
none of such securities were issued in violation of any
statutory preemptive rights or, to our knowledge, contractual
rights of first refusal or similar rights to purchase the
Company's securities. The Shares, when issued and delivered to
and paid for by the Underwriters pursuant to the Agreement,
will be validly issued, fully paid and nonassessable. The
certificates evidencing the Shares are in due and proper legal
form and have been duly authorized for issuance by the
Company. Except as described or incorporated by reference in
the Prospectus, to such counsel's knowledge, there is no
23
outstanding option, warrant or other right calling for the
issuance of, and no commitment, plan or arrangement to issue,
any share of capital stock or other equity interest of each of
the Subsidiaries or any security convertible into, exercisable
for, or exchangeable for capital stock or other equity
interest of each of the Subsidiaries. The issued and
outstanding shares of capital stock or other equity interest
of each of the Domestic Subsidiaries have been duly authorized
and validly issued, are fully paid and nonassessable and are
to such counsel's knowledge owned by the Company or a wholly
owned Subsidiary of the Company free and clear of any security
interests, liens, encumbrances, equities or claims, other than
those described or incorporated by reference in the
Registration Statement, the Preliminary Prospectus and the
Prospectus;
(iv) to such counsel's knowledge, there is no
litigation or governmental proceeding or investigation before
any court or before or by any public body or board, pending or
threatened against, or involving the Company or any of the
Subsidiaries, or to which any of their respective properties
are subject, or any of the respective directors (in their
capacity as such) or officers (in their capacity as such) of
the Company or the Subsidiaries, which is not disclosed in the
Registration Statement or the Prospectus and is required to be
described therein;
(v) the Registration Statement has become
effective under the Securities Act. Any required filing of the
Prospectus, and any supplements thereto, pursuant to Rule 424
(b) promulgated under the Securities Act has been made in the
manner and within the time period required by Rule 424 (b). To
such counsel's knowledge, (i) no stop order suspending the
effectiveness of the Registration Statement has been issued,
and (ii) no proceedings for that purpose have been instituted
or are pending or threatened. The Registration Statement, the
Prospectus (other than the financial statements and schedules
and other financial and statistical information derived
therefrom contained, included or incorporated by reference
therein, as to which we express no opinion) appear on their
face to comply as to form in all material respects with the
applicable requirements of the Securities Act and the rules
promulgated thereunder. The Incorporated Documents (other than
the financial statements and the schedules and other financial
and statistical information derived therefrom included or
incorporated by reference therein, as to which such counsel
expresses no opinion), at the time they were filed, appear on
their face to have complied as to form in all material
respects with the requirements of the Exchange Act;
(vi) the Company has the requisite corporate
power and authority to enter into, deliver and to perform its
obligations under the Agreement, including, without
limitation, the issuance and sale by the Company of the
Shares. The
24
execution, delivery and performance of the Agreement by the
Company has been duly authorized by all necessary corporate
action by the Company;
(vii) neither the Company nor any of the
Subsidiaries is, nor, after giving effect to the offering and
sale of the shares and the application of the net proceeds
thereof as described in the Prospectus, will not be, an
"investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the
Investment Company Act of 1940, as amended, and the rules and
regulations thereunder;
(viii) neither the execution and delivery of the
Agreement by the Company nor the consummation by the Company
of the transactions contemplated by the Agreement, including,
without limitation, the issuance and sale by the Company of
the Shares, will result in the breach or violation of any term
or provision of, or constitute a default under (or any event
which with notice or lapse of time, or both, would constitute
a default under), the terms of (a) any indenture, mortgage,
deed of trust, note, franchise, license, lease, contract or
other agreement or instrument or permit to which the Company
or any of the Subsidiaries is a party or by which the Company
or its properties or assets are bound and in each case which
is filed as an exhibit to the documents incorporated by
reference into the Registration Statement except for breaches
or violations that would not have a Material Adverse Effect;
(b) any decree, order, statute, rule or regulation known to us
to be applicable to the Company or the Subsidiaries or any of
their respective properties; or (c) any provision of the
charter or bylaws of the Company or any of the Domestic
Subsidiaries;
(ix) no consent, approval, authorization or order
of any court or governmental agency or regulatory body is
required for the execution and delivery of the Agreement by
the Company or the consummation or the transactions
contemplated by the Agreement, except (a) such as have been
obtained under the Securities Act, (b) such as may be required
under the "Blue Sky" and state securities laws of any
jurisdiction in connection with the purchase and distribution
of the Shares by the Underwriters in the manner contemplated
in the Agreement and in the Prospectus (as to which such
counsel expresses no opinion), (c) such as may be required for
the clearance of the underwriting arrangements relating to
such offering with the NASD (as to which we express no
opinion), and (d) such other approvals as have been obtained;
(x) to such counsel's knowledge, the Company is
eligible to use a Registration Statement on Form S-3 to
register the Shares;
(xi) the statements (i) in the Prospectus under
"Risk Factors- "We have adopted a shareholder rights plan,
which could discourage or prevent stockholders from selling
their shares at a premium."; (ii) in the Company's
25
Definitive Proxy Statement for the period ended May 22, 2003
under "Employment Agreements and Change-of-Control
Arrangements"; (iii) the Company's Definitive Proxy Statement
for the period ended May 22, 2003 under "Certain
Transactions," and (iv) on the Company's Form 8-A under the
"Description of Capital Stock" have been reviewed by us, and
insofar as such statements constitute summaries of contracts,
agreements or other legal documents, or refer to statements of
law or legal conclusions, to our knowledge, are accurate in
all material respects and present fairly the matters referred
to therein; and
(xii) there are no contracts, agreements or
understandings between the Company and any person or entity,
which are on file as an exhibit to the Registration Statement
or any document incorporated by reference therein, or, to such
counsel's knowledge, otherwise granting such person or entity
the right to require the Company to file a registration
statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person
or entity or to require the Company to include such securities
in the Registration Statements or in any other registration
statement filed by the Company under the Securities Act other
than any such contract, agreement or understanding as to which
a breach or violation could not reasonably be expected to
result in a Material Adverse Effect or to interfere in any
material respect with the completion of the offering and the
sale of the Shares.
In addition, such counsel shall state that such
counsel has participated in conferences with officers and other
representatives of the Company, representatives of the independent
public accountants of the Company and representatives of the
Underwriters at which the contents of the Registration Statement and
Prospectus were discussed and, although such counsel is not passing
upon and does not assume responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement
or Prospectus (except as and to the extent stated in subparagraphs
(ii), (iii) and (xi) above), on the basis of the foregoing nothing has
come to the attention of such counsel that causes them to believe that
the Registration Statement or any amendment thereto at the time such
Registration Statement or amendment became effective 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 or any supplement
thereto at the date of such Prospectus or such supplement, and at the
time of purchase or additional time of purchase, as the case may be,
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, in light of the circumstances under which they were
made, not misleading (it being understood that such counsel need
express no opinion with respect to the financial statements and
schedules and other financial data included in the Registration
Statement or the Prospectus).
26
(b) The Selling Stockholder shall furnish to you at the
time of purchase and at the additional time of purchase, as the case
may be, an opinion of Xxx & Xxxxx Incorporated, counsel for the Selling
Stockholder, addressed to the Underwriters, and dated the time of
purchase or the additional time of purchase, as the case may be, with
reproduced copies for each of the other Underwriters, and in form and
substance satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the
Underwriters, stating that:
(i) this Agreement has been duly executed and
delivered by or on behalf of the Selling Stockholder;
(ii) the Selling Stockholder has requisite
corporate power and authority, and has obtained any
authorization or approval required by law (other than those
imposed by the Act and the securities or blue sky laws of
certain jurisdictions), to sell, assign, transfer and deliver
the Shares to be sold by the Selling Stockholder in the manner
provided in this Agreement; and
(iii) at the time of purchase and any additional
time of purchase, as the case may be, assuming that the
Underwriters purchase the Shares sold by the Selling
Stockholder for value and without notice of any "adverse
claim" (as defined in Section 8-102(a)(1) of the Uniform
Commercial Code as in effect on the date hereof in the State
of New York ("NYUCC")) with respect to such Shares, upon
delivery of the certificates to the Underwriters representing
such Shares, either registered in the name of the Underwriters
or effectively indorsed to the Underwriters or in blank, the
Underwriters will be a "protected purchaser" (as defined in
Section 8-303 of the NYUCC) with respect to such Shares and
the Underwriters will acquire such Shares free of any "adverse
claim" (within the meaning of Section 8-102(a)(1) of the
NYUCC).
To the extent deemed advisable by such counsel, such
counsel may rely as to matters of fact on certificates of the Selling
Stockholder, certificates issued by government agencies and on the
opinions of other counsel as to matters which are governed by laws
other than the laws of the State of Texas.
In addition, such counsel shall state that such
counsel has participated in conferences with officers of the Selling
Stockholder at which the statements concerning the Selling Stockholder
set forth in the Prospectus under the caption "Selling Stockholder"
(the "Covered Statements") were discussed and, although such counsel is
not passing upon and does not assume responsibility for the accuracy,
completeness or fairness of such Covered Statements or any other
statements contained in the Registration Statement or Prospectus, and
has not made any independent verification thereof, on the basis of the
foregoing such counsel has no knowledge that any of the Covered
Statements are inaccurate in any material respect.
27
(c) You shall have received at the time of purchase and,
if applicable, at the additional time of purchase, the opinion of Xx.
Xx Xxxxxxxx, Esq., patent counsel for the Company, dated the time of
purchase or the additional time of purchase, as the case may be, with
reproduced copies for each of the other Underwriters and in form and
substance satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the
Underwriters, stating that:
(i) to such counsel's knowledge, the statements
(i) in the Registration Statement and the Prospectus under the
captions "Risk factors" - "If any of our license agreements
for intellectual property underlying a product candidate are
terminated, we may lose our rights to develop or market that
product", "We have limited marketing capabilities and we are
currently dependent upon third parties to sell and market
CAMPATH(R). We will be required to incur significant expense
to develop our own marketing capabilities" and "We may not be
able to obtain or maintain effective patents to protect our
technologies from use by other companies, and patents of other
companies could prevent us from developing or marketing our
other product candidates"; (ii) in the Company's Annual Report
on Form 10-K for the year ended December 31, 2002 in the first
paragraph under the caption "Recent Developments", in the
second paragraph under the caption "Strategic Alliances" and
under the caption "Intellectual Property, Patents and
Trademarks"; and (iii) in the Company's Quarterly Report on
Form 10-Q for the period ending March 31, 2003 under the
caption "Development and Distribution Agreement", are accurate
and complete statements or summaries of the matters therein
set forth. Nothing has come to such counsel's attention that
causes them to believe that the above-described portions of
the Registration Statement at the time such Registration
Statement became effective 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 or any supplement
thereto, at the date of such Prospectus or such supplement and
at the time of purchase or the additional time of purchase, as
the case may be, contained an untrue statement of material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not
misleading;
(ii) to such counsel's knowledge, (a) other than
normal patent and trademark prosecution matters, there are no
legal or governmental proceedings pending relating to patent
rights, trade secrets, trademarks, service marks or other
proprietary information or materials of the Company, and (b)
no such proceedings are threatened or contemplated by
governmental authorities or others;
28
(iii) such counsel does not know of any contracts
or other documents, relating to the Company's patents, trade
secrets, trademarks, service marks or other proprietary
information or materials, of a character required to be
described in the Registration Statement or the Prospectus or
to be filed as an exhibit to the Registration Statement which
have not been so described or filed required;
(iv) to such counsel's knowledge, (a) the Company
is not infringing or otherwise violating any patents, trade
secrets, trademarks, service marks or other proprietary
information or materials of others, and (b) there are no
infringements by others of any of the Company's patents, trade
secrets, trademarks, service marks or other proprietary
information or materials which in such counsel's judgment
could affect materially the use thereof by the Company;
(v) such counsel has no knowledge of any facts
which would preclude the Company from having valid license
rights or clear title to the patents referenced in the
Registration Statement and the Prospectus. Such counsel has no
knowledge that the Company lacks or will be unable to obtain
any rights or licenses to use all patents and other material
intangible property and assets necessary to conduct the
business now conducted or proposed to be conducted by the
Company as described in the Registration Statement and the
Prospectus, except as described in the Registration Statement
and the Prospectus. Counsel is unaware of any facts which form
a basis for a finding of unenforceability or invalidity of any
of the Company's patents and other material intellectual
property and assets; and
(vi) such counsel is not aware of any material
fact with respect to the patent applications of the Company
presently on file that (a) would preclude the issuance of
patents with respect to such applications, or (b) would lead
such counsel to conclude that such patents, when issued, would
not be valid and enforceable in accordance with applicable
regulations.
(d) You shall have received at the time of purchase and,
if applicable, at the additional time of purchase, the opinion of Ropes
& Xxxx LLP, regulatory counsel for the Company, dated the time of
purchase or the additional time of purchase, as the case may be, with
reproduced copies for each of the other Underwriters and in form and
substance satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the
Underwriters, stating that:
(i) such counsel is not aware of any lawsuit or
regulatory proceeding, pending or threatened, by the Food and
Drug Administration or other regulatory entities within the
Department of Health and Human Services
29
against the company or any subsidiary or affiliated
organization. Nor is such counsel aware of any misstatement or
omission of a material fact within the description of
regulatory matters in the registration statement, though such
counsel's assessment is necessarily limited by the scope of
such counsel's engagement; and
(ii) as to matters within the scope of such
counsel's engagement, such counsel believes, to the best of
its knowledge and information, that the registration statement
accurately reflects in all material respects the circumstances
and relevant risk factors related to those products and
activities.
(e) You shall have received from Ernst & Young LLP
letters dated, respectively, the date of this Agreement, the time of
purchase and, if applicable, the additional time of purchase, and
addressed to the Underwriters (with reproduced copies for each of the
Underwriters) in the forms heretofore approved by UBS Securities.
(f) You shall have received at the time of purchase and,
if applicable, at the additional time of purchase, the favorable
opinion of Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters, dated
the time of purchase or the additional time of purchase, as the case
may be, as to the matters referred to in subparagraph (i) (as to the
jurisdiction of incorporation only), the second sentence (as to the
Shares only) and the third sentence of subparagraph (iii), first,
second and third sentences of subparagraph (v), the last sentence of
subparagraph (vi), and the last subparagraph of Section 6(a).
(g) No Prospectus or amendment or supplement to the
Registration Statement or the Prospectus, including documents deemed to
be incorporated by reference therein, shall have been filed to which
you object in writing.
(h) The Prospectus Supplement shall have been filed with
the Commission pursuant to Rule 424(b) under the Act at or before 5:30
P.M. New York City time on the second full business day after the date
of this Agreement.
(i) Prior to the time of purchase, and, if applicable,
the additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued
under the Act or proceedings initiated under Section 8(d) or 8(e) of
the Act; (ii) the Registration Statement and all amendments thereto
shall 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; and (iii) the Prospectus
and all amendments or supplements thereto shall 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 are made, not
misleading.
30
(j) Between the time of execution of this Agreement and
the time of purchase or the additional time of purchase, as the case
may be, no material adverse change or any development involving a
prospective material adverse change in the business, properties,
management, financial condition or results of operations of the Company
and the Subsidiaries taken as a whole shall occur or become known.
(k) The Company will, at the time of purchase and, if
applicable, at the additional time of purchase, deliver to you a
certificate of its Chief Executive Officer and its Chief Financial
Officer in the form attached as Exhibit B hereto.
(l) The Selling Stockholder will, at the time of purchase
and the additional time of purchase, as the case may be, deliver to you
a certificate of the Selling Stockholder to the effect that the
representations and the warranties of the Selling Stockholder as set
forth in this Agreement are true and correct as of each such date.
(m) You shall have received signed Lock-up Agreements
referred to in Section 3(r) hereof.
(n) The Company and the Selling Stockholder shall have
furnished to you such other documents and certificates as to the
accuracy and completeness of any statement in the Registration
Statement and the Prospectus as of the time of purchase and, if
applicable, the additional time of purchase, as you may reasonably
request.
(o) The Shares shall have been approved for quotation on
NASDAQ, subject only to notice of issuance at or prior to the time of
purchase or the additional time of purchase, as the case may be.
7. Effective Date of Agreement; Termination. This
Agreement shall become effective when the parties hereto have executed and
delivered this Agreement.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of UBS Securities or any group
of Underwriters (which may include UBS Securities) which has agreed to purchase
in the aggregate at least 50% of the Firm Shares, if (x) since the time of
execution of this Agreement or the earlier respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
been any material adverse change or any development involving a prospective
material adverse change in the business, properties, management, financial
condition or results of operations of the Company and the Subsidiaries taken as
a whole, which would, in UBS Securities' judgment or in the judgment of such
group of Underwriters, make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares on the terms and in the manner
contemplated in the Registration Statement and the Prospectus, or (y) since the
execution of this Agreement, there shall have occurred: (i) a suspension or
material limitation in trading in securities generally on the New York Stock
Exchange, the American
31
Stock Exchange or the NASDAQ; (ii) a suspension or material limitation in
trading in the Company's securities on the NASDAQ national market; (iii) a
general moratorium on commercial banking activities declared by either federal
or New York State authorities or a material disruption in commercial banking or
securities settlement or clearance services in the United States; (iv) an
outbreak or escalation of hostilities or acts of terrorism involving the United
States or a declaration by the United States of a national emergency or war; or
(v) 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 UBS Securities' judgment or in the
judgment of such group of Underwriters makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares on the terms and
in the manner contemplated in the Registration Statement and the Prospectus, or
(z) since the time of execution of this Agreement, there shall have occurred any
downgrading, or any notice or announcement shall have been given or made of (i)
any intended or potential downgrading or (ii) any watch, review or possible
change that does not indicate an affirmation or improvement in the rating
accorded any securities of or guaranteed by the Company or any Subsidiary by any
"nationally recognized statistical rating organization," as that term is defined
in Rule 436(g)(2) under the Act.
If UBS Securities or any group of Underwriters elects to
terminate this Agreement as provided in this Section 7, the Company and the
Selling Stockholder and each other Underwriter shall be notified promptly in
writing.
If the sale to the Underwriters of the Shares, as contemplated
by this Agreement, is not carried out by the Underwriters for any reason
permitted under this Agreement or if such sale is not carried out because the
Company and/or the Selling Stockholder shall be unable to comply with any of the
terms of this Agreement, neither the Company nor the Selling Stockholder shall
be under any obligation or liability under this Agreement (except to the extent
provided in Sections 4(i)(n), 5 and 9 hereof), and the Underwriters shall be
under no obligation or liability to the Company or the Selling Stockholder under
this Agreement (except to the extent provided in Section 9 hereof) or to one
another hereunder.
8. Increase in Underwriters' Commitments. Subject to
Sections 6 and 7 hereof, if any Underwriter shall default in its obligation to
take up and pay for the Firm Shares to be purchased by it hereunder (otherwise
than for a failure of a condition set forth in Section 6 hereof or a reason
sufficient to justify the termination of this Agreement under the provisions of
Section 7 hereof) and if the number of Firm Shares which all Underwriters so
defaulting shall have agreed but failed to take up and pay for does not exceed
10% of the total number of Firm Shares, the non-defaulting Underwriters shall
take up and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such
32
non-defaulting Underwriters in such amount or amounts as you may designate with
the consent of each Underwriter so designated or, in the event no such
designation is made, such Shares shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the aggregate number of
Firm Shares set opposite the names of such non-defaulting Underwriters in
Schedule A.
Without relieving any defaulting Underwriter from its
obligations hereunder, the Company and the Selling Stockholder agree with the
non-defaulting Underwriters that it will not sell any Firm Shares hereunder
unless all of the Firm Shares are purchased by the Underwriters (or by
substituted Underwriters selected by you with the approval of the Company or
selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to
and include any Underwriter substituted under this Section 8 with like effect as
if such substituted Underwriter had originally been named in Schedule A.
If the aggregate number of Firm Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Firm Shares which all Underwriters agreed to purchase hereunder, and if
neither the non-defaulting Underwriters nor the Company shall make arrangements
within the five business day period stated above for the purchase of all the
Firm Shares which the defaulting Underwriter or Underwriters agreed to purchase
hereunder, this Agreement shall terminate without further act or deed and
without any liability on the part of the Company or the Selling Stockholder to
any Underwriter and without any liability on the part of any non-defaulting
Underwriter to the Company or the Selling Stockholder. Nothing in this
paragraph, and no action taken hereunder, shall relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
9. Indemnity and Contribution.
(a) The Company agrees to indemnify, defend and hold
harmless each Underwriter, its partners, directors and officers, and any person
who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of the
foregoing persons, from and against any loss, damage, expense, liability or
claim (including the reasonable cost of investigation) which, jointly or
severally, any such Underwriter or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim
33
arises out of or is based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof by the
Company) or in a Prospectus (the term Prospectus for the purpose of this Section
9 being deemed to include the Basic Prospectus, any Prepricing Prospectus, any
Prospectus Supplement or the Prospectus, as any of the foregoing may be amended
or supplemented by the Company), or arises out of or is based upon any omission
or alleged omission to state a material fact required to be stated in either
such Registration Statement or such Prospectus or necessary to make the
statements made therein not misleading, except insofar as any such loss, damage,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in conformity
with information concerning such Underwriter furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in such
Registration Statement or such Prospectus or arises out of or is based upon any
omission or alleged omission to state a material fact in connection with such
information required to be stated in such Registration Statement or such
Prospectus or necessary to make such information not misleading, (ii) any untrue
statement or alleged untrue statement made by the Company in Section 3 hereof or
the failure by the Company to perform when and as required any agreement or
covenant contained herein, or (iii) any untrue statement or alleged untrue
statement of any material fact contained in any audio or visual materials
provided by the Company or utilizing specific written information furnished by
or on behalf of the Company including, without limitation, slides, videos, films
or tape recordings used in connection with the marketing of the Shares;
provided, however, that the indemnity agreement contained in this subsection (a)
as it may relate to any untrue statement in or omission from a Prepricing
Prospectus shall not inure to the benefit of any Underwriter (or to the benefit
of any partner, director or officer of any Underwriter or person controlling
such) from whom the person asserting any such loss, damage, expense, liability
or claim purchased the Shares which is the subject thereof if the Prospectus
corrected such alleged untrue statement or omission and if such Underwriter
failed to send or give a copy of the Prospectus to such person at or prior to
the written confirmation of the sale of such Shares to such person, unless the
failure is the result of noncompliance by the Company with Section 4(i)(b)
hereof.
(b) The Selling Stockholder agrees to indemnify, defend
and hold harmless each Underwriter, its partners, directors and officers, and
any person who controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons, from and against any loss, damage, expense, liability or
claim (including the reasonable cost of investigation) which, jointly or
severally, any such Underwriter or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Company) or in a Prospectus (the term
Prospectus for the purpose of this Section 9 being deemed to include the Basic
34
Prospectus, any Prepricing Prospectus, any Prospectus Supplement or the
Prospectus, as any of the foregoing may be amended or supplemented by the
Company), or arises out of or is based upon any omission or alleged omission to
state a material fact required to be stated in either such Registration
Statement or such Prospectus or necessary to make the statements made therein
not misleading, but only to the extent that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance on and in
conformity with information furnished to the Company by the Selling Stockholder
expressly for use in the Registration Statement or Prospectus (such information
in the Registration Statement and Prospectus under the captions "Selling
Stockholder" is the only information provided by the Selling Stockholder
expressly for use therein); or (ii) any untrue statement or alleged untrue
statement made by the Selling Stockholder in Section 3 hereof or the failure by
the Selling Stockholder to perform when and as required any agreement or
covenant contained herein; provided, however, that the indemnity agreement
contained in this subsection (b) as it may relate to any untrue statement in or
omission from a Prepricing Prospectus shall not inure to the benefit of any
Underwriter (or to the benefit of any partner, director or officer of any
Underwriter or person controlling such) from whom the person asserting any such
loss, damage, expense, liability or claim purchased the Shares which is the
subject thereof if the Prospectus corrected such alleged untrue statement or
omission and if such Underwriter failed to send or give a copy of the Prospectus
to such person at or prior to the written confirmation of the sale of such
Shares to such person, unless the failure is the result of noncompliance by the
Company with Section 4(i)(b) hereof; provided, further, that the Selling
Stockholder shall not be responsible, either pursuant to this indemnity or as a
result of any breach of this Agreement, for losses, expenses, liability or
claims for an amount in excess of the net proceeds to be received by the Selling
Stockholder (before deducting expenses) from the sale of Shares hereunder.
(c) Each Underwriter severally agrees to indemnify,
defend and hold harmless the Company, its directors and officers, and any person
who controls the Company within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, and the Selling Stockholder and any person who controls
the Selling Stockholder within the meaning of Section 15 of the Act of Section
20 and the successors and assigns of all of the foregoing persons, from and
against any loss, damage, expense, liability or claim (including the reasonable
cost of investigation) which, jointly or severally, the Company, the Selling
Stockholder or any such person may incur under the Act, the Exchange Act, the
common law or otherwise, insofar as such loss, damage, expense, liability or
claim arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with information
concerning such Underwriter furnished in writing by or on behalf of such
Underwriter through you to the Company expressly for use in the Registration
Statement (or in the Registration Statement as amended by any post-effective
amendment thereof by the Company) or in a Prospectus, or arises out of or is
based upon any omission or alleged omission to state a material fact in
connection with such information required to be
35
stated in such Registration Statement or such Prospectus or necessary to make
such information not misleading.
(d) If any action, suit or proceeding (each, a
"Proceeding") is brought against any person in respect of which indemnity may be
sought pursuant to the foregoing paragraphs (a), (b) or (c) of this Section 9,
such person (the "indemnified party") shall promptly notify the person against
whom such indemnity may be sought (the "indemnifying party") in writing of the
institution of such Proceeding and such indemnifying party shall assume the
defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party) and payment of all fees and expenses;
provided, however, that the omission to so notify such indemnifying party shall
not relieve such indemnifying party from any liability which it may have to such
indemnified party or otherwise. Such indemnified party shall have the right to
employ its own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless the employment
of such counsel shall have been authorized in writing by such indemnifying party
in connection with the defense of such Proceeding or such indemnifying party
shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to defend such Proceeding or such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to or in conflict
with those available to such indemnifying party (in which case such indemnifying
party shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but such indemnifying party may
employ counsel and participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnifying party), in any of
which events such fees and expenses shall be borne by such indemnifying party
and paid as incurred (it being understood, however, that such indemnifying party
shall not be liable for the expenses of more than one separate counsel (in
addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the indemnified parties who
are parties to such Proceeding). No indemnifying party shall be liable for any
settlement of any such Proceeding effected without the written consent of such
indemnifying party but if settled with the written consent of such indemnifying
party, such indemnifying party agrees to indemnify and hold harmless the
indemnified party from and against any loss or liability by reason of such
settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
sentence of this paragraph, then the indemnifying party agrees that it shall be
liable for any settlement of any Proceeding effected without its written consent
if (i) such settlement is entered into more than 60 business days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement and (iii) such indemnified party
shall have given the indemnifying party at least 30 days' prior notice of its
intention to settle. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any
36
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 and does not include an admission of fault, liability or
failure to act, by or on behalf of such indemnified party.
(e) If the indemnification provided for in this Section 9
is unavailable to an indemnified party under subsections (a), (b) or (c) of this
Section 9 or insufficient to hold an indemnified party harmless in respect of
any losses, damages, expenses, liabilities or claims referred to therein, then
each applicable indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholder on the one
hand and the Underwriters on the other hand from the offering of the Shares or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Selling Stockholder on the one hand and of the Underwriters
on the other in connection with the statements or omissions which resulted in
such losses, damages, expenses, liabilities or claims, as well as any other
relevant equitable considerations. The relative benefits received by the Company
and the Selling Stockholder on the one hand and the Underwriters on the other
shall be deemed to be in the same respective proportions as the total proceeds
from the offering (net of underwriting discounts and commissions but before
deducting expenses) received by the Company and the Selling Stockholder and the
total underwriting discounts and commissions received by the Underwriters, bear
to the aggregate public offering price of the Shares. The relative fault of the
Company and the Selling Stockholder on the one hand and of the Underwriters on
the other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or the Selling
Stockholder on the one hand or by 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 amount paid or payable by a party as a
result of the losses, damages, expenses, liabilities and claims referred to in
this subsection shall be deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with investigating, preparing to
defend or defending any Proceeding.
(f) The Company, the Selling Stockholder and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 9 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 subsection (e) above. Notwithstanding the provisions of this
Section 9, 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 such
Underwriter and distributed to the public
37
were offered to the public exceeds the amount of any damage which such
Underwriter has otherwise been required to pay by reason of such untrue
statement 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 to contribute
pursuant to this Section 9 are several in proportion to their respective
underwriting commitments and not joint.
(g) The indemnity and contribution agreements contained
in this Section 9 and the covenants, warranties and representations of the
Company and the Selling Stockholder contained in this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter, its partners, directors or officers or any person (including
each partner, officer or director of such person) who controls any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
or by or on behalf of the Company, its directors or officers or any person who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, or by or on behalf of the Selling Stockholder, its
respective directors or officers or any person who controls any of the foregoing
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
and shall survive any termination of this Agreement or the delivery of the
Shares. The Company, the Selling Stockholder and each Underwriter agree promptly
to notify each other of the commencement of any Proceeding against the Company
and any of its officers or directors and against the Selling Stockholder and any
of its officers or directors in connection with the issuance and sale of the
Shares, or in connection with the Registration Statement or the Prospectus.
10. Information Furnished by the Underwriters. The
statements set forth in the last paragraph on the cover page of the Prospectus
Supplement and the statements set forth in the fifth, sixth, eighth, ninth,
tenth and eleventh paragraphs under the caption "Underwriting" in the Prospectus
Supplement constitute the only information furnished by or on behalf of the
Underwriters as such information is referred to in Sections 3 and 9 hereof.
11. Notices. Except as otherwise herein provided, all
statements, requests, notices and agreements shall be in writing or by telegram
and, if to the Underwriters, shall be sufficient in all respects if delivered or
sent to UBS Securities LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 00000-0000,
Attention: Syndicate Department and, if to the Company, shall be sufficient in
all respects if delivered or sent to the Company at the offices of the Company
at 0000 Xxxxxxx Xxxx Xxxxxxxxx, Xxx Xxxxxxx, Xxxxx 00000, Attention: General
Counsel; and if to the Selling Stockholder, shall be sufficient in all respects
if delivered or sent to the Selling Stockholder at 7979 Wurzbach Road, Xxxxxxx
Building, Sixth Floor, San Antonio, Texas 78229, Attention: President.
12. Governing Law; Construction. This Agreement and any
claim, counterclaim or dispute of any kind or nature whatsoever arising out of
or in any way relating
38
to this Agreement ("Claim"), directly or indirectly, shall be governed by, and
construed in accordance with, the laws of the State of New York. The Section
headings in this Agreement have been inserted as a matter of convenience of
reference and are not a part of this Agreement.
13. Submission to Jurisdiction. Except as set forth
below, no Claim may be commenced, prosecuted or continued in any court other
than the courts of the State of New York located in the City and County of New
York or in the United States District Court for the Southern District of New
York, which courts shall have jurisdiction over the adjudication of such
matters, and the Company and Selling Stockholder consent to the jurisdiction of
such courts and personal service with respect thereto. Each of the Company and
the Selling Stockholder hereby consents to personal jurisdiction, service and
venue in any court in which any Claim arising out of or in any way relating to
this Agreement is brought by any third party against UBS Securities or any
indemnified party. Each of UBS Securities, the Company (on its behalf and, to
the extent permitted by applicable law, on behalf of its stockholders and
affiliates) and the Selling Stockholder waives all right to trial by jury in any
action, proceeding or counterclaim (whether based upon contract, tort or
otherwise) in any way arising out of or relating to this Agreement. Each of the
Company and the Selling Stockholder agrees that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding thereupon and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
14. Parties at Interest. The Agreement herein set forth
has been and is made solely for the benefit of the Underwriters, the Company and
the Selling Stockholder and to the extent provided in Section 9 hereof the
controlling persons, partners, directors and officers referred to in such
section, and their respective successors, assigns, heirs, personal
representatives and executors and administrators. No other person, partnership,
association or corporation (including a purchaser, as such purchaser, from any
of the Underwriters) shall acquire or have any right under or by virtue of this
Agreement.
15. Counterparts. This Agreement may be signed by the
parties in one or more counterparts which together shall constitute one and the
same agreement among the parties.
16. Successors and Assigns. This Agreement shall be
binding upon the Underwriters, the Company and the Selling Stockholder and their
successors and assigns and any successor or assign of any substantial portion of
the Company's, the Selling Stockholder's and any of the Underwriters' respective
businesses and/or assets.
17. Miscellaneous. UBS Securities, an indirect, wholly
owned subsidiary of UBS AG, is not a bank and is separate from any affiliated
bank, including any U.S. branch or agency of UBS AG. Because UBS Securities is a
separately incorporated entity, it is solely
39
responsible for its own contractual obligations and commitments, including
obligations with respect to sales and purchases of securities. Securities sold,
offered or recommended by UBS Securities are not deposits, are not insured by
the Federal Deposit Insurance Corporation, are not guaranteed by a branch or
agency, and are not otherwise an obligation or responsibility of a branch or
agency.
40
If the foregoing correctly sets forth the understanding among
the Company, the Selling Stockholder and the several Underwriters, please so
indicate in the space provided below for that purpose, whereupon this agreement
and your acceptance shall constitute a binding agreement among the Company, the
Selling Stockholder and the Underwriters, severally.
Very truly yours,
ILEX Oncology, Inc.
By: /s/ Xxxx X. Xxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President and Chief
Financial Officer
Cancer Therapy and Research Center Endowment
By: /s/Xxxxxx X. Xxxx
----------------------------------------
Name: Xxxxxx X. Xxxx
Title: President
Accepted and agreed to as of the
date first above written, on
behalf of itself and the
other several Underwriters
named in Schedule A
UBS SECURITIES LLC
Xxxxxx Brothers
CIBC World Markets Corp.
U.S. Bancorp Xxxxx Xxxxxxx Inc.
As Representative of the several Underwriters
By: UBS SECURITIES LLC
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------
Name:
Title:
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name:
Title:
SCHEDULE A
UNDERWRITER NUMBER OF FIRM SHARES
----------- ---------------------
UBS Securities LLC ............................... 3,000,000
Xxxxxx Brothers .................................. 1,500,000
CIBC World Markets Corp. ......................... 750,000
U.S. Bancorp Xxxxx Xxxxxxx Inc. .................. 750,000
---------
Total ..................................... 6,000,000
=========
1
SCHEDULE B
SUBSIDIARY JURISIDCTION OF INCORPORATION REQUIRED FOREIGN QUALIFICATIONS
---------- ----------------------------- -------------------------------
ILEX Oncology Services, Inc. Delaware Texas
ILEX Products, Inc. Delaware Texas and Massachusetts
ILEX Services Limited United Kingdom
ILEX Acquisitions, Inc. Delaware
ILEX Pharmaceuticals, L.P. Delaware Texas
ILEX Pharmaceuticals, L.L.C. Delaware Texas
ILEX Oncology Research, Sarl Geneva, Switzerland
ILEX Pharmaceuticals, Ltd. United Kingdom
2
EXHIBIT A
ILEX Oncology, Inc.
Common Stock
($0.01 par value)
July ___, 2003
UBS Securities LLC
[Co-Managers]
As Representative of the several Underwriters
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This Lock-Up Letter Agreement is being delivered to you in
connection with the proposed Underwriting Agreement (the "Underwriting
Agreement") to be entered into by ILEX Oncology, Inc. (the "Company") and you,
as Representative of the several Underwriters named therein, with respect to the
public offering (the "Offering") of common stock, par value $0.01 per share, of
the Company (the "Common Stock").
In order to induce you to enter into the Underwriting
Agreement, the undersigned agrees that for a period from the date hereof until
the end of 90 days after the date of the final prospectus supplement relating to
the Offering, the undersigned will not, without the prior written consent of UBS
Securities LLC, (i) sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase or otherwise dispose of or agree to dispose
of, directly or indirectly, or file (or participate in the filing of) a
registration statement with the Securities and Exchange Commission (the
"Commission") in respect of, or establish or increase a put equivalent position
or liquidate or decrease a call equivalent position within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder with respect to, any Common
Stock of the Company or any securities convertible into or
A-1
exercisable or exchangeable for Common Stock, or warrants or other rights to
purchase Common Stock, (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 Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock, or warrants or other rights to purchase Common
Stock, whether any such transaction is to be settled by delivery of Common Stock
or such other securities, in cash or otherwise, or (iii) publicly announce an
intention to effect any transaction specified in clause (i) or (ii). The
foregoing sentence shall not apply to (a) the registration of or sale to the
Underwriters of any Common Stock pursuant to the Offering and the Underwriting
Agreement, (b) bona fide gifts, provided the recipient thereof agrees in writing
with the Underwriters to be bound by the terms of this Lock-Up Letter Agreement
or (c) dispositions to any trust for the direct or indirect benefit of the
undersigned and/or the immediate family of the undersigned, provided that such
trust agrees in writing with the Underwriters to be bound by the terms of this
Lock-Up Letter Agreement.
In addition, the undersigned hereby waives any rights the
undersigned may have to require registration of Common Stock in connection with
the filing of a registration statement relating to the Offering. The undersigned
further agrees that, for a period from the date hereof until the end of 90 days
after the date of the final prospectus supplement relating to the Offering, the
undersigned will not, without the prior written consent of UBS Securities LLC,
make any demand for, or exercise any right with respect to, the registration of
Common Stock of the Company or any securities convertible into or exercisable or
exchangeable for Common Stock, or warrants or other rights to purchase Common
Stock.
If (i) the Company notifies you in writing that it does not
intend to proceed with the Offering, (ii) the registration statement filed with
the Securities and Exchange Commission with respect to the Offering is withdrawn
or (iii) for any reason the Underwriting Agreement shall be terminated prior to
the time of purchase (as defined in the Underwriting Agreement), this Lock-Up
Letter Agreement shall be terminated and the undersigned shall be released from
its obligations hereunder.
Yours very truly,
____________________________________
Name:
A-2
Exhibit B
FORM OF
OFFICERS' CERTIFICATE
The undersigned, [ ], President and Chief Executive Officer of
ILEX Oncology, Inc., a Delaware corporation (the "Company"), and[ ], Senior Vice
President and Chief Financial Officer of the Company, in such capacity on behalf
of the Company (and not individually), do hereby certify pursuant to Section 6(
) of that certain Underwriting Agreement dated July [ ], 2003 (the "Underwriting
Agreement") among the Company, the Selling Stockholder, UBS Securities LLC,
Xxxxxx Brothers Inc., CIBC World Markets Corp., and U.S. Bancorp Xxxxx Xxxxxxx
Inc. that as of [ ]:
(i) No stop order with respect to the effectiveness of
either of the Registration Statements has been issued under the Act and no
proceedings have been initiated under Section 8(d) or 8(e) of the Act for that
purpose;
(ii) The Registration Statement has been declared
effective by the SEC;
(iii) To the best of my knowledge, the Registration
Statements and all amendments thereto, or modifications thereof, and the
Prospectus and all amendments and supplements thereto, or modifications thereof,
do 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 case of the Prospectus, in light of the circumstances under
which they are made) not misleading;
(iv) To the best of my knowledge, between the time of
execution of the Underwriting Agreement and the date hereof, (A) no Material
Adverse Effect, or any development involving a prospective Material Adverse
Effect, has occurred or become known and (B) no transaction which is material
and adverse to the Company has been entered into by the Company or any of the
Subsidiaries;
(v) To the best of my knowledge, the representations and
warranties of the Company as set forth in the Underwriting Agreement are true
and correct as of the date hereof or, if such representations and warranties
speak as of a specific date, as of such date; and
(vi) The Company has performed all of its obligations
under the Underwriting Agreement that are to be performed at or before the date
hereof.
Capitalized terms used herein without definition
shall have the respective meanings ascribed to them in the Underwriting
Agreement.
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