Exhibit 1
5,000,000 SHARES
VARIAGENICS, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
CREDIT SUISSE FIRST BOSTON CORPORATION
CHASE SECURITIES INC.
XX XXXXX SECURITIES CORPORATION
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. INTRODUCTORY. Variagenics, Inc., a Delaware corporation ("COMPANY"),
proposes to issue and sell 5,000,000 shares ("FIRM SECURITIES") of its common
stock par value $0.01 per share ("SECURITIES") and also proposes to issue and
sell to the Underwriters, at the option of the Underwriters, an aggregate of not
more than 750,000 additional shares ("OPTIONAL SECURITIES") of its Securities as
set forth below. The Firm Securities and the Optional Securities are herein
collectively called the "OFFERED SECURITIES". As part of the offering
contemplated by this Agreement, Credit Suisse First Boston Corporation (the
"DESIGNATED UNDERWRITER") has agreed to reserve out of the Firm Securities
purchased by it under this Agreement, up to 250,000 shares, for sale to the
Company's directors, officers, employees and other parties associated with the
Company (collectively, "PARTICIPANTS"), as set forth in the Prospectus (as
defined herein) under the heading "Underwriting" (the "DIRECTED SHARE PROGRAM").
The Firm Securities to be sold by the Designated Underwriter pursuant to the
Directed Share Program (the "DIRECTED SHARES") will be sold by the Designated
Underwriter pursuant to this Agreement at the public offering price. Any
Directed Shares not orally confirmed for purchase by a Participant by the end of
the business day on which this Agreement is executed will be offered to the
public by the Underwriters as set forth in the Prospectus. The Company hereby
agrees with the several Underwriters named in Schedule A hereto ("UNDERWRITERS")
as follows:
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-33558) relating to the Offered
Securities, including a form of prospectus, has been filed with the
Securities and Exchange Commission ("COMMISSION") and either (i) has been
declared effective under the Securities Act of 1933 ("ACT") and is not
proposed to be amended or (ii) is proposed to be amended by amendment or
post-effective amendment. If such registration statement ("INITIAL
REGISTRATION STATEMENT") has been declared effective, either (i) an
additional registration statement ("ADDITIONAL REGISTRATION STATEMENT")
relating to the Offered Securities may have been filed with the Commission
pursuant to Rule 462(b) ("RULE 462(b)") under the Act and, if so filed, has
become effective upon filing pursuant to such Rule and the Offered
Securities all have been duly registered under the Act pursuant to the
initial registration statement and, if applicable, the additional
registration statement or (ii) such an additional registration statement is
proposed to be filed with the Commission pursuant to Rule 462(b) and will
become effective upon filing pursuant to such Rule and upon
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such filing the Offered Securities will all have been duly registered under
the Act pursuant to the initial registration statement and such additional
registration statement. If the Company does not propose to amend the
initial registration statement or if an additional registration statement
has been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has been
filed with the Commission prior to the execution and delivery of this
Agreement, the most recent amendment (if any) to each such registration
statement has been declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c) ("RULE 462(c)") under the Act
or, in the case of the additional registration statement, Rule 462(b). For
purposes of this Agreement, "EFFECTIVE TIME" with respect to the initial
registration statement or, if filed prior to the execution and delivery of
this Agreement, the additional registration statement means (i) if the
Company has advised the Representatives that it does not propose to amend
such registration statement, the date and time as of which such
registration statement, or the most recent post-effective amendment thereto
(if any) filed prior to the execution and delivery of this Agreement, was
declared effective by the Commission or has become effective upon filing
pursuant to Rule 462(c), or (ii) if the Company has advised the
Representatives that it proposes to file an amendment or post-effective
amendment to such registration statement, the date and time as of which
such registration statement, as amended by such amendment or post-effective
amendment, as the case may be, is declared effective by the Commission. If
an additional registration statement has not been filed prior to the
execution and delivery of this Agreement but the Company has advised the
Representatives that it proposes to file one, "EFFECTIVE TIME" with respect
to such additional registration statement means the date and time as of
which such registration statement is filed and becomes effective pursuant
to Rule 462(b). "EFFECTIVE DATE" with respect to the initial registration
statement or the additional registration statement (if any) means the date
of the Effective Time thereof. The initial registration statement, as
amended at its Effective Time, including all information contained in the
additional registration statement (if any) and deemed to be a part of the
initial registration statement as of the Effective Time of the additional
registration statement pursuant to the General Instructions of the Form on
which it is filed and including all information (if any) deemed to be a
part of the initial registration statement as of its Effective Time
pursuant to Rule 430A(b) ("RULE 430A(b)") under the Act, is hereinafter
referred to as the "INITIAL REGISTRATION STATEMENT". The additional
registration statement, as amended at its Effective Time, including the
contents of the initial registration statement incorporated by reference
therein and including all information (if any) deemed to be a part of the
additional registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "ADDITIONAL REGISTRATION
STATEMENT". The Initial Registration Statement and the Additional
Registration Statement are herein referred to collectively as the
"REGISTRATION STATEMENTS" and individually as a "REGISTRATION STATEMENT".
The form of prospectus relating to the Offered Securities, as first filed
with the Commission pursuant to and in accordance with Rule 424(b) ("RULE
424(b)") under the Act or (if no such filing is required) as included in a
Registration Statement, is hereinafter referred to as the "PROSPECTUS". No
document has been or will be prepared or distributed in reliance on Rule
434 under the Act.
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (i) on the Effective
Date of the Initial Registration Statement, the Initial Registration
Statement conformed in all material respects to the requirements of the Act
and the rules and regulations of the Commission ("RULES AND REGULATIONS")
and did not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading, (ii) on the Effective Date of the
Additional Registration Statement (if any), each Registration Statement
conformed, or will conform, in all material respects to the requirements of
the Act and the Rules and Regulations and did not include, or will not
include, any untrue statement of a material fact and did not omit, or will
not omit, to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) on the
date of this Agreement, the Initial Registration
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Statement and, if the Effective Time of the Additional Registration
Statement is prior to the execution and delivery of this Agreement, the
Additional Registration Statement each conforms, and at the time of filing
of the Prospectus pursuant to Rule 424(b) or (if no such filing is
required) at the Effective Date of the Additional Registration Statement in
which the Prospectus is included, each Registration Statement and the
Prospectus will conform, in all material respects to the requirements of
the Act and the Rules and Regulations, and (a) each Registration Statement
does not include, or will not include, any untrue statement of a material
fact or does not omit, or will not omit, to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and (b) the Prospectus does not include, or will not
include, any untrue statement of a material fact or does not omit, or will
not omit, to state any 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. If the Effective Time of the
Initial Registration Statement is subsequent to the execution and delivery
of this Agreement: on the Effective Date of the Initial Registration
Statement, (a) the Initial Registration Statement and the Prospectus will
conform in all material respects to the requirements of the Act and the
Rules and Regulations, (b) the Initial Registration Statement will not
include any untrue statement of a material fact or will not omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading, (c) the Prospectus will not include any
untrue statement of a material fact or will not omit to state any 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 (d) no Additional Registration Statement has been or will
be filed. The two preceding sentences do not apply to statements in or
omissions from a Registration Statement or the Prospectus based upon
written information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and
agreed that the only such information is that described as such in Section
7(b) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus; and the Company is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except to the extent
that the failure to be so qualified or be in good standing, individually or
in the aggregate, would not have a material adverse effect on the condition
(financial or other), business, properties or results of operations of the
Company (a "Material Adverse Effect").
(d) The information as set forth under the caption "Capitalization" in
the Prospectus is true and correct in all material respects; the
outstanding shares of capital stock of the Company have been duly
authorized; all outstanding shares of capital stock of the Company are,
and, when the Offered Securities have been issued, delivered and paid for
in accordance with this Agreement on each Closing Date (as defined below)
such Offered Securities will have been, validly issued, fully paid and
nonassessable and will conform to the description thereof contained under
the caption "Description of Capital Stock" in the Prospectus; the shares of
Common Stock of the Company to be issued upon conversion of the Preferred
Stock upon the Closing of the offering have been duly authorized and when
issued will be fully paid and nonassessable; and the stockholders of the
Company have no preemptive rights with respect to the Offered Securities.
(e) Except for compensation payable by the Company to CSFBC as
disclosed in the Prospectus, there are no contracts, agreements or
understandings between the Company and any person that would give rise to a
valid claim against the Company or any Underwriter for a brokerage
commission, finder's fee or other like payment in connection with this
offering of the Offered Securities.
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(f) Except as described in the Prospectus, and except for rights with
respect to this offering of the Offered Securities which have been validly
waived, there are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the
Company to file a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person or to require
the Company to include such securities in the Securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(g) The Offered Securities have been approved for listing on The
Nasdaq Stock Market's National Market subject to notice of issuance.
(h) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance and sale of the Offered Securities by the
Company, except (i) such as have been obtained and made under the Act, (ii)
such consents, approvals or filings with the National Association of
Securities Dealers, Inc. (the "NASD") and (iii) such as may be required
under state or foreign securities laws.
(i) The execution, delivery and performance of this Agreement, and the
issuance and sale of the Offered Securities will not result in a breach or
violation of (A) any of the terms and provisions of, or constitute a
default under, any statute, any rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any of its properties, or any agreement or
instrument to which the Company is a party or by which the Company is bound
or to which any of the properties of the Company is subject, or (B) the
charter or by-laws of the Company, except in the case of (A) for such
violations that would not have, individually or in the aggregate, a
Material Adverse Effect; and the Company has full power and authority to
authorize, issue and sell the Offered Securities as contemplated by this
Agreement.
(j) This Agreement has been duly authorized, executed and delivered by
the Company.
(k) Except as disclosed in the Prospectus, the Company has good and
marketable title to all real properties and all other properties and assets
owned by it, in each case free from liens, encumbrances and defects that
would materially affect the value thereof or materially interfere with the
use made or to be made thereof by it; and except for liens in favor of
Imperial Bank and its assignees, the Company holds any leased real or
personal property under valid and enforceable leases with no exceptions
that would materially interfere with the use made or to be made thereof by
it.
(l) The Company possesses adequate certificates, authorities or
permits issued by appropriate governmental agencies or bodies necessary to
conduct the business now operated by it, as described in the Prospectus,
and has not received any notice of proceedings relating to the revocation
or modification of any such certificate, authority or permit that, if
determined adversely to the Company, would individually or in the aggregate
have a Material Adverse Effect.
(m) No labor dispute with the employees of the Company exists or, to
the knowledge of the Company, is imminent which if adversely determined
would, individually or in the aggregate, have a Material Adverse Effect.
(n) The Company owns, or is licensed to use, all patents, patent
applications, inventions, trademarks, service marks, trade names,
applications for registration of trademarks and service marks, copyrights,
know-how, manufacturing processes, formulae, trade secrets, licenses and
rights in any thereof and any other intangible property and assets
(collectively, "INTELLECTUAL
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PROPERTY RIGHTS") necessary to conduct its business as described in the
Prospectus. The description of the intellectual property rights in the
Prospectus fairly summarizes and correctly describes the Company's rights
with respect thereto in all material respects. The Company does not have
any knowledge of, and the Company has not given or received any notice of,
any conflicts with or infringement of the asserted rights of others with
respect to any intellectual property rights that, if determined adversely
to the Company, would individually or in the aggregate have a Material
Adverse Effect. No action, suit, arbitration, or legal, administrative or
other proceeding, or investigation is pending, or, to the best knowledge of
the Company, threatened, which involves any intellectual property rights
which if adversely determined would, individually or in the aggregate, have
a Material Adverse Effect. The Company is not subject to any judgment,
order, writ, injunction or decree of any court or any Federal, state,
local, foreign or other governmental department, commission, board, bureau,
agency or instrumentality, or any arbitrator, and has not entered into and
is not a party to any agreement, which restricts or impairs the use of any
intellectual property rights in a manner which would individually or in the
aggregate have a Material Adverse Effect. No intellectual property rights
and no services or products sold, licensed or performed by the Company
conflict with or infringe upon any proprietary rights of any third party in
a manner that would, individually or in the aggregate, have a Material
Adverse Effect. No claims have been asserted by any person or entity with
respect to the validity of the Company's ownership or right to use the
intellectual property rights and, to the best knowledge of the Company,
there is no reasonable basis for any such claim to be successful. The
intellectual property rights are valid and enforceable, except as may be
limited by applicable insolvency, reorganization, moratorium or similar
rights relating to or affecting creditor's rights generally or by law, and
except to the extent that any invalidity or unenforceability would not have
a Material Adverse Effect and the expected expiration of any such
intellectual property rights would not result in a Material Adverse Effect.
The Company has complied, in all material respects, with its contractual
obligations relating to the protection of the intellectual property rights
used pursuant to licenses. To the knowledge of the Company, no person or
entity is infringing on or violating the intellectual property rights in a
manner that does or would have a Material Adverse Effect.
(o) Except as disclosed in the Prospectus, the Company is not in
violation of any applicable statute, any rule, regulation, decision or
order of any governmental agency or body or any court, domestic or foreign,
relating to the use, disposal or release of hazardous or toxic substances
or relating to the protection or restoration of the environment or human
exposure to hazardous or toxic substances (collectively, "ENVIRONMENTAL
LAWS"), does not own or operate any real property contaminated with any
substance that is subject to any environmental laws, or, to the knowledge
of the Company, is liable for any off-site disposal or contamination
pursuant to any environmental laws, or is subject to any claim relating to
any environmental laws, which violation, contamination, liability or claim
would individually or in the aggregate have a Material Adverse Effect; and
the Company is not aware of any pending investigation which might lead to
such a claim.
(p) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company or any of
its properties that, if determined adversely to the Company, would
individually or in the aggregate have a Material Adverse Effect, or would
materially and adversely affect the ability of the Company to perform its
obligations under this Agreement, or which are otherwise material in the
context of the sale of the Offered Securities; and no such actions, suits
or proceedings are, to the Company's knowledge, threatened or contemplated.
(q) There are no contracts or documents to which the Company is a
party which are of a character required to be filed as exhibits to the
Registration Statement which are not filed as required.
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(r) The financial statements included in each Registration Statement
and the Prospectus (taken together with the related notes and schedules
thereto) present fairly in all material respects the financial position of
the Company as of the dates shown and their results of operations and cash
flows for the periods shown, and such financial statements have been
prepared in conformity with the generally accepted accounting principles in
the United States ("GAAP") applied on a consistent basis, except that the
interim financial statements do not contain all of the notes that would be
required by GAAP if such statements were audited and are subject to normal
year-end adjustments, which are not expected to be material; and the
assumptions used in preparing the pro forma financial statements included
in each Registration Statement and the Prospectus provide a reasonable
basis for presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma columns
therein reflect the proper application of those adjustments to the
corresponding historical financial statement amounts.
(s) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there has
been no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company, and, except
as disclosed in or contemplated by the Prospectus, there has been no
dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.
(t) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940.
(u) The Company has not offered, or caused the Underwriters to offer
any Offered Securities pursuant to the Directed Share Program to any person
in any jurisdiction outside the United States.
(v) The Company has not offered, or caused the Underwriters to offer,
any Offered Securities to any person pursuant to the Directed Share Program
with the specific intent to unlawfully influence (i) a customer or supplier
of the Company to alter the customer's or supplier's level or type of
business with the Company or (ii) a trade journalist or publication to
write or publish favorable information about the Company or its products.
(w) The Company has delivered to the Underwriters a letter and
schedule dated July [ ], 2000 which lists all of the patents, patent
applications, registered trademarks and service marks and trademark and
service xxxx applications owned or used by the Company in the conduct of
the business now operated by them or presently employed by them. The letter
and the schedule constitute a complete and accurate list, in all material
respects, of all such patents, patent applications, registered trademarks
and service marks and trademark and service xxxx applications, and the
information set forth in the letter and the schedule is complete and
accurate in all material respects as of the date hereof.
3. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $ per share, the respective numbers
of shares of Firm Securities set forth opposite the names of the Underwriters
in Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives for the
accounts of the Underwriters through the facilities of the Depository Trust
Company, against payment of the purchase price in Federal (same day) funds by
official bank check or checks drawn to the order of the Company or
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wire transfer to an account designated by the Company at a bank acceptable to
Credit Suisse First Boston Corporation ("CSFBC"). The Closing of the sale of the
Firm Securities will take place at the offices of Xxxxx Xxxxxxx Xxxxxxx & Xxxxx
LLP, 0000 Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, at 10:00 A.M., New York time,
on _________, 2000, or at such other time not later than seven full business
days thereafter as CSFBC and the Company determine, such time being herein
referred to as the "FIRST CLOSING DATE". For purposes of Rule 15c6-1 under the
Securities Exchange Act of 1934, the First Closing Date (if later than the
otherwise applicable settlement date) shall be the settlement date for payment
of funds and delivery of securities for all the Offered Securities sold pursuant
to the offering. The certificates for the Firm Securities so to be delivered
will be in definitive form, in such denominations and registered in such names
as CSFBC requests and will be made available for inspection by the
Representatives at least 24 hours prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the Company from time
to time not more than 30 days subsequent to the date of the Prospectus, the
Underwriters may purchase all or less than all of the Optional Securities at the
purchase price per Security to be paid for the Firm Securities. The Company
agrees to sell to the Underwriters the number of shares of Optional Securities
specified in such notice and the Underwriters agree, severally and not jointly,
to purchase such Optional Securities. Such Optional Securities shall be
purchased for the account of each Underwriter in the same proportion as the
number of shares of Firm Securities set forth opposite such Underwriter's name
bears to the total number of shares of Firm Securities (subject to adjustment by
CSFBC to eliminate fractions) and may be purchased by the Underwriters only for
the purpose of covering over-allotments made in connection with the sale of the
Firm Securities. No Optional Securities shall be sold or delivered unless the
Firm Securities previously have been, or simultaneously are, sold and delivered.
The right to purchase the Optional Securities or any portion thereof may be
exercised from time to time and to the extent not previously exercised may be
surrendered and terminated at any time upon notice by CSFBC to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING DATE", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by CSFBC
but shall be not later than five full business days after written notice of
election to purchase Optional Securities is given. The Company will deliver the
Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters through the
facilities of the Depository Trust Company, against payment of the purchase
price therefor in Federal (same day) funds by official bank check or checks
drawn to the order of the Company or wire transfer to an account designated by
the Company at a bank acceptable to CSFBC. Each closing for the sale of Optional
Securities will take place at the offices of Xxxxx Xxxxxxx Xxxxxxx & Xxxxx. The
certificates for the Optional Securities being purchased on each Optional
Closing Date will be in definitive form, in such denominations and registered in
such names as CSFBC requests upon reasonable notice prior to such Optional
Closing Date and will be made available for inspection by the Representatives at
a reasonable time in advance of such Optional Closing Date.
4. OFFERING BY UNDERWRITERS. It is understood that the several Underwriters
propose to offer the Offered Securities for sale to the public as set forth in
the Prospectus.
5. CERTAIN AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance with
Subparagraph (1) (or, if applicable and if consented to by CSFBC,
subparagraph (4)) of Rule 424(b) not later than the earlier of (A) the
second business day following the execution and delivery of this Agreement
or (B) the fifteenth business day after the Effective Date of the Initial
Registration Statement.
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The Company will advise CSFBC promptly of any such filing pursuant to
Rule 424(b). If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement and an additional
registration statement is necessary to register a portion of the Offered
Securities under the Act but the Effective Time thereof has not occurred as
of such execution and delivery, the Company will file the additional
registration statement or, if filed, will file a post-effective amendment
thereto with the Commission pursuant to and in accordance with Rule 462(b)
on or prior to 10:00 P.M., New York time, on the date of this Agreement or,
if earlier, on or prior to the time the Prospectus is printed and
distributed to any Underwriter, or will make such filing at such later date
as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to amend or
supplement the initial or any additional registration statement as filed or
the related prospectus or the Initial Registration Statement, the
Additional Registration Statement (if any) or the Prospectus and will not
effect such amendment or supplementation without CSFBC's consent; and the
Company will also advise CSFBC promptly of the effectiveness of each
Registration Statement (if its Effective Time is subsequent to the
execution and delivery of this Agreement) and of any amendment or
supplementation of a Registration Statement or the Prospectus and of the
institution by the Commission of any stop order proceedings in respect of a
Registration Statement and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of which,
in the judgment of the Company or in the reasonable opinion of the
Underwriters, the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it is necessary at any
time to amend the Prospectus to comply with the Act, the Company will
promptly notify CSFBC of such event and will promptly prepare and file with
the Commission, at its own expense, an amendment or supplement to the
Prospectus which will correct such statement or omission or an amendment
which will effect such compliance. Neither CSFBC's consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional Registration
Statement) which will satisfy the provisions of Section 11(a) of the Act.
For the purpose of the preceding sentence, "AVAILABILITY DATE" means the
45th day after the end of the fourth fiscal quarter following the fiscal
quarter that includes such Effective Date, except that, if such fourth
fiscal quarter is the last quarter of the Company's fiscal year,
"AVAILABILITY DATE" means the 90th day after the end of such fourth fiscal
quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement (four of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a
prospectus relating to the Offered Securities is required to be delivered
under the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in each
case in such quantities as CSFBC may reasonably request. The Company will
use its reasonable best efforts to cause the Prospectus to be so furnished
on or prior to 3:00 P.M., New York time, on the business day following the
later of the execution and delivery of this Agreement or the Effective Time
of the Initial Registration Statement. All other documents shall be so
furnished as soon as available. The Company will pay the expenses of
printing and distributing to the Underwriters all such documents.
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(f) The Company will arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC
designates and will continue such qualifications in effect so long as
required for the distribution.
(g) During the period of three (3) years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a
copy of its annual report to stockholders for such year; and the Company
will furnish to the Representatives (i) as soon as available, a copy of
each report and any definitive proxy statement of the Company filed with
the Commission under the Securities Exchange Act of 1934 or mailed to
stockholders, and (ii) from time to time, such other information concerning
the Company as CSFBC may reasonably request.
(h) The Company will pay all expenses incident to the performance of
its obligations under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) incurred in
connection with qualification of the Offered Securities for sale under the
laws of such jurisdictions as CSFBC designates and the printing of
memoranda relating thereto for the filing fee incident to, and the
reasonable fees and disbursements of counsel to the Underwriters in
connection with, the review by the NASD of the Offered Securities, for any
travel expenses of the Company's officers and employees and any other
expenses of the Company in connection with attending or hosting meetings
with prospective purchasers of the Offered Securities and for expenses
incurred in distributing preliminary prospectuses and the Prospectus
(including any amendments and supplements thereto) to the Underwriters.
(i) For a period of 180 days after the date of the initial public
offering of the Offered Securities, the Company will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or indirectly,
or file with the Commission a registration statement under the Act relating
to, any additional shares of its Securities or securities convertible into
or exchangeable or exercisable for any shares of its Securities, or
publicly disclose the intention to make any such offer, sale, pledge,
disposition or filing, without the prior written consent of CSFBC, except
(i) issuances of Securities pursuant to the conversion or exchange of
convertible or exchangeable securities or the exercise of warrants or
options, in each case outstanding on the date hereof, (ii) grants of stock
options to the Company's employees, directors, consultants and advisors
pursuant to the terms of a plan in effect on the date hereof, (iii)
issuances of Securities pursuant to the exercise of such options; (iv) as
disclosed in the Prospectus, the issuance of Securities, a warrant to
purchase Securities, and issuance of Securities upon exercise of the
warrant issued to Waters Investments Limited expected to close
contemporaneously with the closing of the Offering on the First Closing
Date or as soon as practicable thereafter following receipt of regulatory
approvals under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976;
and (v) the filing by the Company with the Commission of a registration
statement or statements on Form S-8 with respect to options issued, and
issuances of Securities pursuant to the exercise of such options, pursuant
to the Company's 1997 Employee, Director and Consultant Stock Option Plan
and 2000 Employee Stock Purchase Plan.
(j) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required
by the NASD from sale, transfer, assignment, pledge or hypothecation for a
period of three months following the date of the effectiveness of the
Registration Statement. The Designated Underwriter will notify the Company
as to which Participants will need to be so restricted. The Company will
direct the transfer agent to place stop transfer restrictions upon such
securities for such period of time.
9
(k) The Company will pay all reasonable fees and disbursements of
counsel incurred by the Underwriters in connection with the Directed Shares
Program and stamp duties, similar taxes or duties or other taxes, if any,
incurred by the underwriters in connection with the Directed Share Program.
Furthermore, the Company covenants with the Underwriters that it will
not offer or sell, or cause the Underwriters to offer or sell, any
Securities pursuant to the Directed Share Program to any person in any
jurisdiction outside of the United States.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of
the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time), of PriceWaterhouseCoopers
LLP confirming that they are independent public accountants within the
meaning of the Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial statements and schedules
examined by them and included in the Registration Statements comply as
to form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations;
(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing Standards
No. 71, Interim Financial Information, on the unaudited financial
statements included in the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements
of the Company, inquiries of officials of the Company who have
responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that caused them
to believe that:
(A) the unaudited financial statements included in the
Registration Statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act
and the related published Rules and Regulations or any material
modifications should be made to such unaudited financial
statements for them to be in conformity with generally accepted
accounting principles;
(B) the unaudited consolidated net revenue, net loss from
operations, net loss and net loss per share amounts for the three
month periods ended March 31, 2000 included in the Prospectus do
not agree with the amounts set forth in the unaudited
consolidated financial statements for those same periods or were
10
not determined on a basis substantially consistent with that of
the corresponding amounts in the audited statements of income;
(C) at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not more
than three business days prior to the date of such letter, there
was any change in the capital stock or any increase in short-term
indebtedness or long-term debt of the Company or, at the date of
the latest available balance sheet read by such accountants,
there was any decrease in consolidated net assets, as compared
with amounts shown on the latest balance sheet included in the
Prospectus; or
(D) for the period from the closing date of the latest
income statement included in the Prospectus to the closing date
of the latest available income statement read by such accountants
there were any decreases, as compared with the corresponding
period of the previous year and with the period of corresponding
length ended the date of the latest income statement included in
the Prospectus, in consolidated net sales in the total or per
share amounts of consolidated net income,
except in all cases set forth in clauses C and D above for changes,
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Registration Statements (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company subject
to the internal controls of the Company's accounting system or are
derived directly from such records by analysis or computation) with
the results obtained from inquiries, a reading of such general
accounting records and other procedures specified in such letter and
have found such dollar amounts, percentages and other financial
information to be in agreement with such results, except as otherwise
specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "REGISTRATION STATEMENTS" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective
amendment to be filed shortly prior to its Effective Time, (ii) if the
Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement but the Effective Time of the
Additional Registration is subsequent to such execution and delivery,
"REGISTRATION STATEMENTS" shall mean the Initial Registration Statement and
the additional registration statement as proposed to be filed or as
proposed to be amended by the post-effective amendment to be filed shortly
prior to its Effective Time, and (iii) "PROSPECTUS" shall mean the
prospectus included in the Registration Statements.
(b) If the Effective Time of the Initial Registration Statement is not
prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date
of this Agreement or such later date as shall have been consented to by
CSFBC. If the Effective Time of the Additional Registration Statement (if
any) is not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New York
time, on the date of this Agreement or, if earlier, the time the Prospectus
is printed and distributed to any Underwriter, or shall have occurred at
such later date as shall have been consented to by CSFBC. If the Effective
Time of the Initial Registration Statement is prior to the execution and
delivery of this Agreement, the Prospectus shall have been
11
filed with the Commission in accordance with the Rules and Regulations and
Section 5(a) of this Agreement. Prior to such Closing Date, no stop order
suspending the effectiveness of a Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or,
to the knowledge of the Company or the Representatives, shall be
contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company which, in the
judgment of a majority in interest of the Underwriters including the
Representatives, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the sale
of and payment for the Offered Securities; (ii) any downgrading in the
rating of any debt securities or preferred stock of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities or preferred stock of the Company (other than an announcement
with positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (iii) any material suspension or
material limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company on
any exchange or in the over-the-counter market; (iv) any banking moratorium
declared by U.S. Federal or New York authorities; or (v) any outbreak or
escalation of major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national or
international calamity or emergency if, in the judgment of a majority in
interest of the Underwriters including the Representatives, the effect of
any such outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.,
counsel for the Company, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own or lease its
properties and conduct its business as described in the Prospectus;
and the Company is duly qualified to do business as a foreign
corporation in good standing in the Commonwealth of Massachusetts,
which is the only jurisdiction in which the Company maintains an
office or leases property;
(ii) The Offered Securities delivered on such Closing Date have
been duly authorized and will be validly issued, fully paid and
nonassessable when issued and paid for as contemplated by this
Agreement and all other outstanding shares of the capital stock of the
Company outstanding prior to the issuance of the Offered Securities
have been duly authorized and validly issued, and to such counsel's
knowledge, are fully paid and nonassessable and the description
thereof contained in the Prospectus under the caption "Description of
Capital Stock" fairly summarizes the information called for with
respect thereto and to the extent required under the Act and the Rules
and Regulations thereunder; the shares of Common Stock of the Company
to be issued upon conversion of the Preferred Stock upon the Closing
of the offering have been duly authorized and, when issued, will be,
to such counsel's knowledge, fully paid and nonassessable; and the
stockholders of the Company have no preemptive rights with respect to
the Offered Securities under Delaware General Corporation Law, the
Company's Certificate of Incorporation or By-laws or, to the best of
such counsel's knowledge, any other agreement or instrument to which
the Company is a party or by which the Company is bound;
12
(iii) And except for rights with respect to this offering which
have been validly waived as described in the Prospectus, to the best
of such counsel's knowledge, there are no contracts, agreements or
understandings between the Company and any person granting such person
the right to require the Company to file a registration statement
under the Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or, except as described in the Prospectus, in any securities
being registered pursuant to any other registration statement filed by
the Company under the Act;
(iv) The Company is not and, after giving effect to the issuance
and sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940.
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance or sale of the Offered Securities by the
Company, except (i) such as have been obtained and made under the Act,
(ii) such consents, approvals or filings as may be required by or with
the NASD and (iii) such as may be required under state or foreign
securities laws (with respect to which such counsel expresses no
opinion);
(vi) The execution, delivery and performance of this Agreement by
the Company and the issuance and sale of the Offered Securities by the
Company will not result in a breach or violation of any of the terms
and provisions of, or constitute a default under (a) the Certificate
of Incorporation or By-laws of the Company, (b) any existing
applicable statute, rule, or regulation (other than applicable state
securities or blue sky laws governing the purchase and distribution of
the Offered Securities, as to which such counsel expresses no
opinion), (c) to such counsel's knowledge, any order of any
governmental agency or body or any court having jurisdiction over the
Company or any of its properties, resulting, individually or in the
aggregate, in a Material Adverse Effect or (d) any agreement filed as
an exhibit to the Registration Statement, and the Company has full
power and authority to authorize, issue and sell the Offered
Securities as contemplated by this Agreement;
(vii) The Initial Registration Statement was declared effective
under the Act as of the date and time specified in such opinion, the
Additional Registration Statement (if any) was filed and became
effective under the Act as of the date and time (if determinable)
specified in such opinion, the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified in
such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be), and, to the best of the knowledge of
such counsel, no stop order suspending the effectiveness of a
Registration Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are pending or
threatened by the Commission;
(viii) Each Registration Statement and the Prospectus (except as
to the financial statements and schedules and other financial data and
statistical data derived therefrom as to which such counsel need
express no opinion), and each amendment or supplement
13
thereto, as of their respective effective or issue dates, complied as
to form in all material respects with the requirements of the Act and
the Rules and Regulations;
(ix) To the knowledge of such counsel, but without inquiring into
the dockets of any court, commission, administrative agency or other
governmental body, there are no legal or governmental proceedings
pending or threatened against the Company which are required to be
disclosed in the Registration Statement which are not disclosed as
required, nor to such counsel's knowledge are there contracts or
documents to which the Company is a party which are required to be
filed as exhibits to the Registration Statement which are not filed as
required;
(x) The statements set forth under the captions "Business -
Commercial Collaborations," "Business - Government Regulation,"
"Management - 1997 Employee, Director and Consultant Stock Option
Plan," "Management - 2000 Employee Stock Purchase Plan," "Transactions
with Executive Officers, Directors and Five Percent Stockholders,"
"Description of Capital Stock," and "Shares Eligible for Future Sale"
in the Prospectus insofar as such statements purport to summarize
legal matters, documents or proceedings referred to therein, fairly
summarize in all material respects such legal matters, documents or
proceedings to the extent required under the Act and the Rules and
Regulations thereunder;
(xi) This Agreement has been duly authorized, executed and
delivered by the Company; and
(xii) In addition to the matters set forth above, counsel
rendering the foregoing opinion shall also include a statement to the
effect that while such counsel have not independently examined and
verified and accordingly are not passing upon and do not assume
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statements (it being
understood that while such counsel represents the Company with respect
to the offering of the Offered Securities and other matters, including
certain limited matters related to intellectual property, other
counsel generally represents the Company with respect to patent
matters), based upon its participation in conferences with officers
and representatives of the Company, counsel for the underwriters and
the independent accountants of the Company, nothing has come to such
counsel's attention which has caused such counsel to believe that any
part of the Registration Statement or any amendment thereto (except as
to the financial statements and schedules and other financial data and
statistical data derived therefrom as to which such counsel need
express no opinion) on the date it became effective under the Act or
as of such Closing Date, contained any untrue statement of a material
fact or omitted to state any material fact required to be stated
therein or necessary to make the statement therein not misleading, or
that the Prospectus or any amendment or supplement thereto (except as
to the financial statements and schedules and other financial data and
statistical data derived therefrom as to which such counsel need
express no opinion), as of its issue date or as of such Closing Date
contained any untrue statement of a material fact or omitted or omits
to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(e) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, intellectual property
counsel for the Company, in a form and satisfactory to Xxxxx Xxxxxxx
Xxxxxxx & Xxxxx LLP, counsel for the Underwriters, to the effect that:
14
(i) Based upon such counsel's interaction with scientists and
management at the Company, as well as knowledge obtained preparing and
prosecuting the noted domestic patent applications, and directing the
prosecution of foreign patent applications for the Company, the
statements set forth under the captions "Table of Contents," "Risk
Factors," "Business-Intellectual Property," and "Business-Legal
Proceedings" of the Registration Statement, to the extent that those
sections concern patents and patent applications handled by such
counsel on behalf of the Company, no facts which have come to such
counsel's attention in the normal course of such counsel's
representation indicate that language relating to such matters,
including allele specific targeting of inhibitors and pharmacogenetic
uses of gene variances, is inaccurate.
(f) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxx & Xxxxxx LLP, patent counsel for the Company, in a
form and satisfactory to Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, counsel for the
Underwriters, to the effect that:
(i) With respect to patent matters handled by such counsel on
behalf of the Company and except as described in the Prospectus under
the captions "Table of Contents," "Risk Factors,"
"Business-Intellectual Property," and "Business-Legal Proceedings," to
the best of such counsel's knowledge, there is no pending or
threatened action, suit, proceeding, or claim by others that the
Company is infringing any patent which could result in any material
adverse effect on the Company;
(ii) With respect to patent matters handled by such counsel on
behalf of the Company and except as described in the Prospectus
relating to patent matters under the captions "Table of Contents,"
"Risk Factors," "Business-Intellectual Property," and "Business-Legal
Proceedings," such counsel is not aware of any facts that would form a
basis for the belief that the Company lacks any rights or licenses to
use all patents necessary to conduct the business by the Company as
described in the Prospectus;
(iii) With respect to patent matters handled by such counsel on
behalf of the Company, no facts have come to such counsel's attention
which cause such counsel to believe that the statements in the
Prospectus relating to patent matters under the captions "Table of
Contents," "Risk Factors," Business-Intellectual Property," and
"Business-Legal Proceedings," contain an untrue or misleading
statement of material fact, or omit a material fact necessary to make
the statements therein not misleading; and
(iv) With respect to patent matters handled by such counsel on
behalf of the Company and based upon counsel's (a) inquiry of the
Company's representatives responsible for patent matters, (b)
counsel's review of the chain of title records obtained from the
United States Patent and Trademark Office for the Company's United
States Patents, and (c) instructions to foreign associates to file any
Notice of Entitlement or any assignment to the Company in a foreign
jurisdiction as required by that jurisdiction, with regard to the
Company's foreign Patents:
(A) the Patents have been validly assigned or exclusively
licensed to the Company; and
(B) other than as previously disclosed to the
Representatives in writing, such counsel knows of no claim of a
third party to any ownership interest in, or to any lien with
respect to, any of the Patents, and knows of no nonjoined
inventorship interest in any of the Patents. Other than
obligations to the parties previously disclosed to the
Representatives in writing, such counsel has no knowledge of any
facts that would preclude the Company from having clear title and
unencumbered right to the Patents; and
(C) none of the Patents has been abandoned.
15
(g) The Representatives shall have received an opinion, dated such
Closing Date, of Fish & Xxxxxxxxxx P.C., patent counsel for the Company, in
a form and satisfactory to Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, counsel for
the Underwriters, to the effect that:
(i) To the best of such counsel's knowledge, the statements in
the Prospectus relating to the patent matters handled by such counsel
on behalf of the Company under the captions "Table of Contents," "Risk
Factors," "Business-Intellectual Property," and "Business-Legal
Proceedings," insofar as such statements constitute a summary of legal
matters, documents, or proceedings, are accurate in all material
respects and present fairly the matters set forth therein;
(ii) With respect to the patent matters handled by such counsel
on behalf of the Company and except as described in the Prospectus
under the captions "Table of Contents," "Risk Factors,"
"Business-Intellectual Property," and "Business-Legal Proceedings," to
the best of such counsel's knowledge, there is no pending or
threatened action, suit, proceeding or claim by others that the
Company is infringing any patent which could result in any material
adverse effect on the Company;
(iii) With respect to the patent matters handled by such counsel
on behalf of the Company and except as described in the Prospectus
relating to patent and trademark matters under the captions "Table of
Contents," "Risk Factors," "Business-Intellectual Property," and
"Business-Legal Proceedings," such counsel is not aware of any facts
that would form a basis for the belief that the Company lacks any
rights or licenses to use all patents, trademarks, copyrights,
know-how and other intellectual property necessary to conduct the
business now conducted or proposed to be conducted by the Company as
described in the Prospectus;
(iv) With respect to the patent matters handled by such counsel
on behalf of the Company and based upon such counsel's inquiry of the
Company's representative responsible for patent matters, such counsel
knows of no claim of a third party to any ownership interest in, or to
any lien with respect to the patent. Such counsel does not know of any
facts that would preclude the Company from having clear title and
unencumbered right the patent application. The patent application
handled by such counsel on behalf of the Company is pending and has
been validly assigned; and
(v) In addition, based solely upon such counsel's activity with
respect to the patent matters handled by such counsel on behalf of the
Company, no facts have come to such counsel's attention which cause
such counsel to believe that the statements in the Prospectus relating
to patent and trademark matters under the captions "Table of
Contents," "Risk Factors," and "Business," contain an untrue or
misleading statement of material fact, or omit a material fact
necessary to make the statements therein not misleading.
(h) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxx and Xxxx LLP, trademark counsel for the Company, in a
form and satisfactory to Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, counsel for the
Underwriters to the effect that:
(i) To the best of such counsel's knowledge, the statements in
the Prospectus relating to the Trademarks under the captions
"Trademarks," "Risk Factors," and "Business," insofar as such
statements constitute a summary of legal matters, documents, or
proceedings, are accurate in all material respects and present fairly
the matters set forth therein;
16
(ii) Except as described in the Prospectus relating to the
Trademarks under the captions "Trademarks," "Risk Factors," and
"Business," to the best of such counsel's knowledge, there is no
pending or threatened action, suit, proceeding or claim by others that
the Company is infringing any Trademarks which could result in any
material adverse effect on the Company;
(iii) Except as described in the Prospectus relating to the
Trademarks under the captions "Trademarks," "Risk Factors," and
"Business," such counsel is not aware of any facts that would form a
basis for the belief that the Company lacks any rights or licenses to
use the Trademarks necessary to conduct the business now conducted by
the Company as described in the Prospectus. No facts have come to such
counsel's attention which cause such counsel to believe that the
statements in the Prospectus relating to the Trademarks under the
captions "Trademarks," "Risk Factors," and "Business," contain an
untrue or misleading statement of material fact, or omit a material
fact necessary to make the statements therein not misleading; and
(iv) Based upon such counsel's (a) inquiry of the Company's
representatives responsible for trademark matters, (b) such counsel's
review of the applications for Trademarks as filed with the United
States Patent and Trademark Office, and (c) instructions to foreign
associates to file applications for Trademarks on behalf of the
Company:
(A) the Company is listed as the sole holder of record of
each of the Trademarks. Such counsel knows of no claim of a third
party to any ownership interest in, or to any lien with respect
to any of the Trademarks. Such counsel has no knowledge of any
facts that would preclude the Company from having clear title and
unencumbered right to the Trademarks; and
(B) None of the Trademarks has been abandoned.
(i) The Representatives shall have received an opinion, dated such
Closing Date, of Lyon & Lyon LLP, intellectual property counsel for the
Company, in a form and satisfactory to Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP,
counsel for the Underwriters, to the effect that:
(i) To such counsel's knowledge, the Company is listed in the
records of the United States Patent and Trademark Office (the USPTO)
under the name "Variagenics, Inc." as the holder of record of the
above-identified U.S. Applications. Such counsel is not presently
aware of any claims, which are not disclosed in the Prospectus, of
third parties to any ownership interest or lien with respect to any of
the U.S. Applications. Such counsel is presently unaware of any
non-joined inventorship interest. Such counsel is not presently aware
of any material defect in form in the preparation or filing of the
U.S. Applications on behalf of the Company. In particular, to the best
of such counsel's knowledge, all prior art references pertinent to the
applications identified herein have been disclosed to the USPTO and,
likewise to the best of such counsel's knowledge, neither such counsel
nor the Company have made any misrepresentations to or concealed any
material fact from the USPTO. To such counsel's knowledge, the Company
owns, as its sole property, the U.S. Applications. Such counsel is not
aware of any facts that would preclude the Company from having clear
title and unencumbered right to the U.S. Applications. To such
counsel's knowledge, the U.S. Applications are pending and in
prosecution before the USPTO; and
17
(ii) With respect to the PCT Patent Application Serial No.
PCT/US99/22988, filed September 30, 1999, and entitled "A Method for
Analyzing Polynucleotides," Lyon & Lyon Docket No. 245/287WO (the
"Application"):
(A) The Company is identified as the sole owner and
applicant of the Application. Such counsel is not presently aware
of any claims, not disclosed in the Prospectus, of third parties
to any ownership interest or lien with respect to the
Application. Such counsel is unaware of any non-joined
inventorship interest in the Application. Such counsel is not
presently aware of any material defect in form in the preparation
or filing of the Application on behalf of the Company. To such
counsel's knowledge, the Application is presently pending and in
prosecution. To such counsel's knowledge, the Company owns as its
sole property the pending Application. Such counsel is not aware
of any facts that would preclude the Company from having clear
title and unencumbered right to the Application. The election to
Proceed Under Chapter 11 of the PCT has been timely filed with
respect to the Application;
(B) Statements in the Prospectus under the captions "Risk
Factors" and "Business," as such statements relate to the
Application and insofar as such statements constitute a summary
of legal matters, documents or proceedings, are, to the best of
such counsel's knowledge, accurate in all material respects and
present fairly the matters set forth therein;
(C) Except as described in the Prospectus under the captions
"Risk Factors" and "Business," to the best of such counsel's
knowledge, there is no pending or threatened action, suit,
proceeding or claim by others that the Company is infringing any
patent which could result in any material adverse effect on the
Company with regard to the subject matter of any of the
above-identified patent applications;
(D) Except as described in the Prospectus under the captions
"Risk Factors" and "Business," to the best of such counsel's
knowledge there are no facts of which such counsel is aware that
would form the basis for any belief that the Company lacks any
rights or licenses to the above-identified patent applications or
the subject matter thereof necessary to conduct the business now
being conducted by the Company or business which the Company
proposes to conduct as described in the Prospectus; and
(E) No facts have come to such counsel's attention which
cause such counsel to believe, in the Prospectus under the
captions "Risk Factors" and "Business," that, with respect to the
Application, there are any untrue or misleading statements of
material fact or omissions of material fact necessary to make the
statements therein not misleading.
18
(j) The Representatives shall have received an opinion, dated such
Closing Date, of Swabey Xxxxxx Xxxxxxx, intellectual property counsel for
the Company, in a form and satisfactory to Xxxxx Xxxxxxx Xxxxxxx & Xxxxx
LLP, counsel for the Underwriters, to the effect that:
(i) To such counsel's knowledge, all actions necessary to be
taken to pursue patent protection in Europe and Canada, which country
or region was designated in the patent application handled by such
counsel on behalf of the Company, have been taken, and neither the
European nor the Canadian pending application has been allowed to
lapse or otherwise been abandoned, such that applicant's right for
protection in Europe and Canada have either been perfected or remain
pending; and
(ii) To such counsel's knowledge, there are no claims to any
ownership interests or lien on any of the applications handled by such
counsel on behalf of the Company, by any party other than the
Assignee, whenever recorded. To such counsel's knowledge, each of the
applications handled by such counsel on behalf of the Company was
properly filed in conformance with the National Rules applicable.
(k) The Representatives shall have received from Xxxxx Xxxxxxx Xxxxxxx
& Xxxxx LLP, counsel for the Underwriters, such opinion or opinions, dated
such Closing Date, with respect to the incorporation of the Company, the
validity of the Offered Securities delivered on such Closing Date, the
Registration Statements, the Prospectus and other related matters as the
Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to
pass upon such matters. In rendering such opinion, Xxxxx Xxxxxxx Xxxxxxx &
Xxxxx LLP may rely as to the incorporation of the Company and all other
matters governed by Delaware law upon the opinion of Mintz, Levin, Cohn,
Ferris, Glovsky and Popeo, P.C. referred to above.
(l) The Representatives shall have received a certificate, dated such
Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall state
that: the representations and warranties of the Company in this Agreement
are true and correct; the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied hereunder
at or prior to such Closing Date; no stop order suspending the
effectiveness of any Registration Statement has been issued and no
proceedings for that purpose have been instituted or, to their knowledge,
are contemplated by the Commission; the Additional Registration Statement
(if any) satisfying the requirements of subparagraphs (1) and (3) of Rule
462(b) was filed pursuant to Rule 462(b), including payment of the
applicable filing fee in accordance with Rule 111(a) or (b) under the Act,
prior to the time the Prospectus was printed and distributed to any
Underwriter; and, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties or
results of operations of the Company except as set forth in or contemplated
by the Prospectus or as described in such certificate.
(m) The Representatives shall have received a letter, dated such
Closing Date, of PricewaterhouseCoopers LLP which meets the requirements of
subsection (a) of this Section, except that the specified date referred to
in such subsection will be a date not more than three days prior to such
Closing Date for the purposes of this subsection.
(n) On or prior to the date of this Agreement, the Representatives
shall have received lockup letters from each of the executive officers and
directors of the Company and substantially all stockholders of the
Company's outstanding Common Stock, on an as-converted or as-exercised
basis in the case of holders of securities convertible into, or exercisable
for, Common Stock.
19
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CSFBC may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder,
whether in respect of an Optional Closing Date or otherwise.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company will indemnify and
hold harmless each Underwriter, its partners, directors and officers and each
person, if any, who controls such Underwriter within the meaning of Section
15 of the Act, against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement in or
omission or alleged omission from any of such documents in reliance upon and
in conformity with written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein, it
being understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in subsection (b)
below; and provided, further, that with respect to any untrue statement or
alleged untrue statement in or omission or alleged omission from any
preliminary prospectus the indemnity agreement contained in this subsection
(a) shall not inure to the benefit of any Underwriter from whom the person
asserting any such losses, claims, damages or liabilities purchased the
Offered Securities concerned, to the extent that a prospectus relating to
such Offered Securities was required to be delivered by such Underwriter
under the Act in connection with such purchase and any such loss, claim,
damage or liability of such Underwriter results from the fact that there was
not sent or given to such person at or prior to the written confirmation of
the sale of such Offered Securities to such person, a copy of the Prospectus
if the Company had previously furnished copies thereof to such Underwriter.
The Company agrees to indemnify and hold harmless the Designated
Underwriter and each person, if any, who controls the Designated Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act (the "DESIGNATED ENTITIES"), from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) (i) caused by any untrue statement or
alleged untrue statement of a material fact contained in any material prepared
by or with the consent of the Company for distribution to Participants in
connection with the Directed Share Program or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; (ii) caused by the
failure of any Participant to pay for and accept delivery of Directed Shares
that the Participant agreed to purchase; or (iii) related to, arising out of, or
in connection with the Directed Share Program, other than losses, claims,
damages or liabilities (or expenses relating thereto) that are finally
judicially determined to have resulted from the bad faith or gross negligence of
the Designated Entities.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any
who controls the Company within the meaning of Section 15 of the Act,
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any
20
related preliminary prospectus, or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives specifically for use therein, and will reimburse any legal
or other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed that
the only such information furnished by any Underwriter consists of (i) the
following information in the Prospectus furnished on behalf of each
Underwriter: (i) the concession and reallowance figures appearing in the
fourth paragraph under the caption "Underwriting"; (ii) the information
concerning discretionary sales contained in the sixth paragraph under the
caption "Underwriting"; and (iii) the information concerning Regulation M
contained in the fifteenth paragraph under the caption "Underwriting".
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to any indemnified
party otherwise than under subsection (a) or (b) above. In case any such
action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to
the indemnifying party), and after notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof,
the indemnifying party will not be liable to such indemnified party under
this Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than
reasonable costs of investigation. Notwithstanding anything contained
herein to the contrary, if indemnity may be sought pursuant to the last
paragraph in Section 7 (a) hereof in respect of such action or proceeding,
then in addition to such separate firm for the indemnified parties, the
indemnifying party shall be liable for the reasonable fees and expenses of
not more than one separate firm (in addition to any local counsel) for the
Designated Underwriter for the defense of any losses, claims, damages and
liabilities arising out of the Directed Share Program, and all persons, if
any, who control the Designated Underwriter within the meaning of either
Section 15 of the Act of Section 20 of the Exchange Act. No indemnifying
party shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened action 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 (i) includes an unconditional release of such indemnified party
from all liability on any claims that are the subject matter of such action
and (ii) does not include a statement as to, or an admission of, fault,
culpability or a failure to act by or on behalf of an indemnified party.
(d) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a)
or (b) above, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other
from the offering of the Securities or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company on the one hand
and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other
shall be deemed to be in the same proportion as the total net proceeds from
the offering (before deducting expenses) received by the Company bear to
21
the total underwriting discounts and commissions received by the
Underwriters. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim
which is the subject of this subsection (d). Notwithstanding the provisions
of this subsection (d), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each director of the
Company, to each officer of the Company who has signed a Registration
Statement and to each person, if any, who controls the Company within the
meaning of the Act.
8. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date, the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the Offered Securities that such defaulting Underwriters
agreed but failed to purchase on such Closing Date. If any Underwriter or
Underwriters so default and the aggregate number of shares of Offered Securities
with respect to which such default or defaults occur exceeds 10% of the total
number of shares of Offered Securities that the Underwriters are obligated to
purchase on such Closing Date and arrangements satisfactory to CSFBC and the
Company for the purchase of such Offered Securities by other persons are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company, except
as provided in Section 9 (provided that if such default occurs with respect to
Optional Securities after the First Closing Date, this Agreement will not
terminate as to the Firm Securities or any Optional Securities purchased prior
to such termination). As used in this Agreement, the term "Underwriter" includes
any person substituted for an Underwriter under this Section. Nothing herein
will relieve a defaulting Underwriter from liability for its default.
9. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it
22
pursuant to Section 5 and the respective obligations of the Company and the
Underwriters pursuant to Section 7 shall remain in effect, and if any Offered
Securities have been purchased hereunder the representations and warranties in
Section 2 and all obligations under Section 5 shall also remain in effect. If
the purchase of the Offered Securities by the Underwriters is not consummated
for any reason other than solely because of the termination of this Agreement
pursuant to Section 8 or the occurrence of any event specified in clause (iii),
(iv) or (v) of Section 6(c), the Company will reimburse the Underwriters for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.
10. NOTICES. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
the Representatives, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking
Department--Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at 00 Xxxxxxxxx Xxxxxx,
Xxxxxxxxx, XX 00000, Attention: Xxxxxx X. Xxxxxx; provided, however, that any
notice to an Underwriter pursuant to Section 7 will be mailed, delivered or
telegraphed and confirmed to such Underwriter.
11. SUCCESSORS. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 7, and no other person
will have any right or obligation hereunder.
12. REPRESENTATION OF UNDERWRITERS. The Representatives will act for the
several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFBC will be binding
upon all the Underwriters.
13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
23
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.
Very truly yours,
VARIAGENICS, INC.
By.....................................
Xxxxxx X. Xxxxxx
President and Chief Executive Officer
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
CHASE SECURITIES INC.
XX XXXXX SECURITIES CORPORATION
Acting on behalf of themselves and as the Representatives of the several
Underwriters
By CREDIT SUISSE FIRST BOSTON CORPORATION
By.......................................................
Name:
Title:
24
SCHEDULE A
UNDERWRITER NUMBER OF
FIRM SECURITIES
Credit Suisse First Boston Corporation........................
Chase Securities Inc..........................................
XX Xxxxx Securities Corporation...............................
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Total......................................................... 5,000,000
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