<PAGE> 1
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------
FORM 10-Q
-----------
(Mark One)
X Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
- - Act of 1934
FOR THE PERIOD ENDED MARCH 31, 1996
OR
__ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
COMMISSION FILE NUMBER: 0-28324
BIOTRANSPLANT INCORPORATED
(Exact name of registrant as specified in its charter)
DELAWARE 04-3119555
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
CHARLESTOWN NAVY YARD, BUILDING 75 THIRD AVENUE
CHARLESTOWN, MASSACHUSETTS 02129
(Address of principal executive offices)
(617) 241-5200
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days:
Yes No X *
--- ---
* All forms have been filed as required; the registrant has not been subject to
such filing requirements for the past 90 days.
As of June 12, 1996, there were 8,548,748 shares of the Registrant's Common
Stock outstanding.
================================================================================
<PAGE> 2
BIOTRANSPLANT INCORPORATED
FORM 10-Q
INDEX
<TABLE>
PART I. FINANCIAL INFORMATION
<CAPTION>
Page No.
--------
<S> <C> <C>
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
Condensed Consolidated Balance Sheets as of December 31, 1995,
March 31, 1996 and Pro Forma as of March 31, 1996...................... 3
Condensed Consolidated Statement of Operations for three months
ended March 31, 1995 and 1996, and for the period from
inception (March 20, 1990) to March 31, 1996 .......................... 4
Condensed Consolidated Statement of Cash Flows for three months
ended March 31, 1995 and 1996, and for the period from
inception (March 20, 1990) to March 31, 1996 .......................... 5
Notes to Condensed Consolidated Financial Statements................... 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS............................................. 8
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K...................................... 12
SIGNATURES............................................................ 12
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
BIOTRANSPLANT INCORPORATED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
<TABLE>
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<CAPTION>
Pro Forma
December 31, March 31, March 31,
1995 1996 1996
------------ ------------ ------------
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 2,848,549 $ 6,167,920 $ 34,166,620
Accounts receivable 250,000 24,168 24,168
Deposits and other prepaid expenses 343,303 373,521 373,521
------------ ------------ ------------
Total current assets 3,441,852 6,565,609 34,564,309
Property and equipment - net 1,830,219 1,684,299 1,684,299
Other assets 99,563 157,476 157,476
------------ ------------ ------------
TOTAL ASSETS $ 5,371,634 $ 8,407,384 $ 36,406,084
============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current obligation under capital leases $ 450,768 $ 435,109 $ 435,109
Accounts payable 187,225 189,410 189,410
Accrued expenses 967,430 917,745 917,745
Deferred revenue 1,750,000 -- --
------------ ------------ ------------
Total current liabilities 3,355,423 1,542,264 1,542,264
------------ ------------ ------------
Long-term obligation under capital lease 614,939 506,449 506,449
------------ ------------ ------------
Convertible notes payable to stockholders 1,000,000 -- --
------------ ------------ ------------
Redeemable convertible preferred stock, $.01 par value,
authorized 19,110,521 shares, issued and
outstanding 15,586,345 and 19,081,754 shares
at December 31, 1995 and March 31, 1996,
respectively, and no shares pro forma 29,241,474 36,186,820 --
------------ ------------ ------------
Stockholders' equity (deficit):
Preferred stock, $.01 par value, authorized 2,000,000
shares, issued and outstanding - no shares -- -- --
Common stock, $.01 par value, authorized 25,000,000
shares, issued and outstanding 126,594 shares
at December 31, 1995 and March 31, 1996, and
8,548,748 shares pro forma 1,266 1,266 85,487
Additional paid-in capital 1,230,343 1,230,343 65,331,642
Accumulated deficit (30,071,811) (31,059,758) (31,059,758)
------------ ------------ ------------
Total stockholders equity (deficit) (28,840,202) (29,828,149) 34,357,371
------------ ------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 5,371,634 $ 8,407,384 $ 36,406,084
============ ============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
3
<PAGE> 4
BIOTRANSPLANT INCORPORATED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
<TABLE>
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<CAPTION>
Three Months Ended March 31,
---------------------------- Cumulative Since
1995 1996 Inception
----------- ---------- ------------
<S> <C> <C> <C>
Revenues:
License fees $ -- $ -- $ 7,000,000
Research and development 375,000 2,000,000 10,500,000
Interest income 59,309 75,697 601,174
----------- ---------- ------------
Total revenues 434,309 2,075,697 18,101,174
----------- ---------- ------------
Expenses:
Research and development 2,530,036 2,555,630 38,830,837
General and administrative 430,616 456,806 8,722,405
Interest 193,091 51,208 1,607,690
----------- ---------- ------------
Total expenses 3,153,743 3,063,644 49,160,932
----------- ---------- ------------
Net loss $(2,719,434) $ (987,947) $(31,059,758)
=========== ========== ============
Pro forma net loss per common share $ (0.68) $ (0.19)
=========== ==========
Shares used in computing pro forma net
loss per common share 4,008,979 5,131,246
=========== ==========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
4
<PAGE> 5
BIOTRANSPLANT INCORPORATED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
<TABLE>
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
Three Months Ended March 31,
---------------------------- Cumulative Since
1995 1996 Inception
----------- ----------- -------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $(2,719,434) $ (987,947) $(31,059,758)
Adjustments to reconcile net loss to net cash
provided by (used) in operating activities:
Depreciation and amortization 204,162 175,050 2,051,817
Noncash interest expense -- 15,583 505,710
Noncash expenses related to options
and warrants 42,556 -- 1,085,683
Changes in current assets and liabilities:
Accounts receivable (8,339) 225,832 (24,168)
Deposits and prepaid expenses 61,061 (30,218) (373,521)
Accounts payable (273,308) 2,185 189,410
Accrued expenses 431,370 (9,452) 917,745
Deferred revenue 3,625,000 (1,750,000) --
----------- ----------- ------------
Net cash provided by (used in) operating activities 1,363,068 (2,358,967) (26,707,082)
----------- ----------- ------------
Cash flows from investing activities:
Purchases of property and equipment (58,826) (29,130) (3,111,383)
Disposal of property and equipment, net -- -- 28,040
Increase in other assets -- (57,913) (57,913)
----------- ----------- ------------
Net cash used in investing activities (58,826) (87,043) (3,141,256)
----------- ----------- ------------
Cash flows from financing activities:
Proceeds from convertible notes payable to stockholders -- -- 9,400,000
Payments of obligations under capital leases (138,128) (124,149) (1,252,651)
Proceeds from sale/leaseback of equipment -- -- 771,968
Net proceeds from equipment leases -- -- 1,422,240
Net proceeds from sale of redeemable convertible preferred stock -- 5,889,530 25,661,526
Proceeds from sale of common stock 183 -- 13,175
----------- ----------- ------------
Net cash provided by (used for) financing activities (137,945) 5,765,381 36,016,258
----------- ----------- ------------
Net increase in cash and cash equivalents 1,166,297 3,319,371 6,167,920
Cash and cash equivalents, beginning of period 2,343,126 2,848,549 --
----------- ----------- ------------
Cash and cash equivalents, end of period $ 3,509,423 $ 6,167,920 $ 6,167,920
=========== =========== ============
Supplemental disclosures and noncash transactions:
Increase in equipment under capital leases $ -- $ -- $ (2,210,270)
=========== =========== ============
Conversion of convertible notes payable to stockholders and
accrued interest into redeemable convertible preferred stock $ -- $ 1,055,816 $ 9,905,710
=========== =========== ============
Issuance of warrants $ -- $ -- $ 741,737
=========== =========== ============
Interest paid during the period $ 84,598 $ 35,611 $ 1,250,540
=========== =========== ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
5
<PAGE> 6
BIOTRANSPLANT INCORPORATED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. OPERATIONS AND BASIS OF PRESENTATION
BioTransplant Incorporated (the "Company") was incorporated on March 20, 1990.
The Company is developing proprietary anti-rejection pharmaceuticals and organ
transplantation systems which represent a comprehensive approach to inducing
long-term specific transplantation tolerance in humans.
The Company is in the development stage and is devoting substantially all of
its efforts toward product research and development and raising capital. The
Company is subject to a number of risks similar to those of other development
stage companies, including dependence on key individuals, competition from
substitute products and larger companies, the development of commercially usable
products, obtaining regulatory approval for products under development, the
development and marketing of commercial products, and the need to obtain
adequate additional financing necessary to fund the development of its products.
During May 1996, the Company completed an initial public offering of 3,220,000
of common stock resulting in net proceeds of approximately $28.0 million (see
Note 6).
The financial statements herein have been prepared by the Company, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission ("SEC") and include, in the opinion of management, all adjustments,
consisting of normal, recurring adjustments, necessary for a fair representation
of interim period results. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. The results for the interim periods presented are not necessarily
indicative of results to be expected for the fiscal year or any future period.
It is suggested that these condensed consolidated financial statements be read
in conjunction with the audited consolidated financial statements and the notes
thereto included in the Company's initial public offering Prospectus dated May
8, 1996, which is part of the Company's Registration Statement on Form S-1, as
amended and filed with the SEC (Reg. No. 333-2144).
2. CASH AND CASH EQUIVALENTS
Cash and cash equivalents are stated at cost, which approximates market value,
and include short-term, highly liquid investments with original maturities of
less than three months from the date of purchase.
6
<PAGE> 7
3. PRO FORMA NET LOSS PER COMMON SHARE
Pro forma net loss per common share is based on the pro forma weighted average
number of common shares outstanding during the periods presented, assuming the
automatic conversion of all shares of Series A, B, D and E redeemable
convertible preferred stock then outstanding into 3,212,896 and 3,896,580 shares
of common stock at March 31, 1995 and 1996, respectively. Pursuant to the
requirements of the SEC , common stock and preferred stock issued during the 12
months immediately preceding the initial public offering, plus shares of common
stock that became issuable during the same period pursuant to the grant of
common stock options and warrants, have been included in the calculation of pro
forma weighted average number of common shares outstanding for the entire period
using the treasury stock method. Historical net loss per share has not been
presented as such information is not considered to be relevant or meaningful.
4. CONVERSION OF NOTES PAYABLE TO STOCKHOLDERS
During February 1996, the Company converted the $1,000,000 note payable to
stockholders and $55,816 of accrued interest into 527,909 shares of Series D
redeemable convertible preferred stock, which automatically converted into
131,975 shares of common stock upon the closing of the initial public offering
discussed in Note 6.
5. SALE OF SERIES D PREFERRED STOCK
During January and February 1996, the Company sold an aggregate of 2,967,500
shares of Series D redeemable convertible preferred stock for net proceeds of
approximately $5,890,000. These preferred shares automatically converted
into 741,875 shares of common stock upon the closing of the initial public
offering discussed in Note 6.
6. INITIAL PUBLIC OFFERING
In May 1996, the Company completed an initial public offering of 3,220,000
shares of common stock for $9.50 per share, resulting in net proceeds of
approximately $28.0 million. In addition, all outstanding shares of Series A, B,
D and E redeemable convertible preferred stock were automatically converted into
5,202,154 shares of common stock upon the closing of the initial public
offering.
The pro forma balance sheet as of March 31, 1996 reflects the effect of the
initial public offering, including the automatic conversion of all outstanding
redeemable convertible preferred stock into common stock and the receipt of the
net proceeds therefrom, as if it had occurred on March 31, 1996.
7
<PAGE> 8
BIOTRANSPLANT INCORPORATED
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion of the financial condition and results of operations of
the Company for the three months ended March 31, 1995 and 1996 should be read in
conjunction with the accompanying unaudited condensed consolidated financial
statements and the related notes thereto.
This report may contain certain forward looking statements which involve risks
and uncertainties. Such statements are subject to certain factors which may
cause the Company's plans and results to differ significantly from the plans and
results discussed in forward looking statements. Factors that may cause such
differences include, but are not limited to, the progress of the Company's
research and development programs, the Company's ability to compete
successfully, the Company's ability to attract and retain qualified personnel,
the Company's ability to enter into and maintain collaborations with third
parties, the Company's ability to enter into and progress in clinical trials,
the time and costs involved in obtaining regulatory approvals, the costs
involved in obtaining and enforcing patents, proprietary rights and any
necessary licenses, the ability of the Company to establish development and
commercialization capacities or relationships, the costs of manufacturing, the
Company's ability to obtain additional funds, and those other risks discussed
under the heading "Risk Factors" in the Prospectus dated May 8, 1996 included in
the Company's Registration Statement on Form S-1, as amended (Reg. No.
333-2144).
OVERVIEW
Since commencement of operations in 1990, the Company has been a development
stage company engaged primarily in the research and development of proprietary
anti-rejection pharmaceuticals and organ transplantation systems which
represent a comprehensive approach to inducing long-term specific
transplantation tolerance in humans. The major sources of the Company's working
capital have been the proceeds of equity placements, sponsored research funding
and license fees and capital lease financings. The Company has not generated
any revenues from the sales of products to date, and does not expect to receive
any product revenues for several years. The Company will be required to conduct
significant research, development, testing and regulatory compliance activities
that, together with general and administrative expenses, are expected to result
in significant and increasing operating losses for at least the next several
years.
In 1993, and as amended and restated in September 1995, the Company and Sandoz
entered into a collaboration agreement for the development and
commercialization of xenotransplantation products utilizing gene transduction.
Under the agreement, Sandoz has committed research funding through March 1998
of $20.0 million, of which $10.0 million had been received as of March 31,
1996, and agreed to pay license fees of $10.0 million, of which $5.0 million
had been received as of March 31, 1996. Sandoz has also agreed to fund certain
development and premarketing costs of such products, portions of which,
8
<PAGE> 9
under certain circumstances, may be repayable from the Company's operating
profits from sales of such products.
In October 1995, the Company and MedImmune formed a collaborative research
agreement for the development of products to treat and prevent organ rejection.
MedImmune paid the Company a $2.0 million license fee at the time of execution
of the agreement, and agreed to fund and assume responsibility for clinical
testing and commercialization of BTI-322 and other related products. MedImmune
has agreed to provide research support and make milestone payments which could
total up to an additional $14.0 million, of which $500,000 had been received as
of March 31, 1996.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
Revenues increased to $2.1 million for the three months ended March 31, 1996
from $434,000 for the three months ended March 31, 1995. The increase in
revenues was due to increased research and development revenues which consisted
of increased funding from Sandoz of $1.4 million for the three months ended
March 31, 1996 as a result of the amendment and restatement of the collaboration
agreement and $250,000 in research support revenue recognized in connection with
the collaboration formed with MedImmune.
Research and development expenses increased to $2.6 million for the three months
ended March 31, 1996 from $2.5 million for the three months ended March 31,
1995. This increase was primarily due to increases in research and development
staff together with the associated increases in supplies and support services,
partially offset by decreased expenditures related to the human clinical safety
trials for BTI-322.
General and administrative expenses increased to $457,000 for the three months
ended March 31, 1996 from $431,000 for the three months ended March 31, 1995.
This increase was primarily due to increases in outside professional services in
connection with market research and business development in part offset by
decreased salary and related expenses for general and administrative personnel.
Interest income increased to $76,000 for the three months ended March 31, 1996
from $59,000 for the three months ended March 31, 1995. The increase was due
primarily to higher cash balances available for investment.
Interest expense decreased to $51,000 for the three months ended March 31, 1996
from $193,000 for the three months ended March 31, 1995. The decrease was
primarily due to the conversion of $4.4 million and $1.0 million of convertible
notes payable, and the accrued interest thereon, to stockholders into redeemable
convertible preferred stock in October 1995 and February 1996, respectively. The
redeemable convertible preferred stock was then automatically converted into
738,208 shares of common stock upon the closing of the Company's initial public
9
<PAGE> 10
offering. In addition, the decrease was in part attributable to decreasing
balances on existing obligations under capital leases
Net loss for the three months ended March 31, 1996 was $988,000, or $0.19 per
share, compared to a net loss of $2.7 million, or $0.68 per share for the three
months ended March 31, 1995.
LIQUIDITY AND CAPITAL RESOURCES
On May 8, 1996, the Company completed an initial public offering of 2,800,000
shares of common stock at a price of $9.50 per share, and received net proceeds
of approximately $24.3 million. In addition, all outstanding shares of Series A,
B, D and E redeemable convertible preferred stock were automatically converted
into 5,202,154 shares of common stock upon the closing of the initial public
offering. On May 18, 1996, the underwriters of the offering exercised their
over-allotment option to purchase an additional 420,000 shares of common stock
resulting in additional net proceeds of approximately $3.7 million to the
Company.
Since its inception and prior to the completion of the Company's initial public
offering, the Company's operations have been funded principally through the net
proceeds of an aggregate of $36.2 million from private placements of equity
securities. The Company has also received $15.0 million from a research and
development and collaboration agreement with Sandoz, $2.5 million from an
alliance agreement with MedImmune and $2.2 million in equipment lease
financing. The proceeds of the private placements, notes payable and capital
leases and cash generated from the corporate collaborations with Sandoz and
MedImmune have been used to fund operating losses of approximately $31.1
million and the investment of approximately $3.7 million in equipment and
leasehold improvements through March 31, 1996. The Company had no significant
commitments as of March 31, 1996 for capital expenditures.
During the three months ended March 31, 1996, the Company paid Stem Cell
Sciences $250,000 of a $500,000 commitment for research support and to maintain
its pro rata equity interest in Stem Cell Sciences. In addition, the Company has
an option to purchase additional shares of Stem Cell Sciences prior to July
1996, to maintain its pro rata equity interest and provide research support. If
the Company does not make such further investment, its rights to certain
technologies become nonexclusive.
The Company had cash and cash equivalents and working capital of $34.2 and $33.0
million, respectively, on a pro forma basis as of March 31, 1996, reflecting the
net proceeds of $28.0 million from the initial public offering as described
above.
The Company has entered into sponsored research and consulting agreements with
certain hospitals, academic institutions and consultants, requiring periodic
payments by the Company. Aggregate minimum funding obligations under these
agreements, which include certain cancellation provisions, total approximately
$5.0 million, which includes approximately $2.4 million and $776,000 in 1996 and
1997, respectively.
10
<PAGE> 11
The Company anticipates that its existing funds, together with the proceeds from
its initial public offering and the exercise of the over-allotment option, and
interest earned thereon should be sufficient to fund its operating and capital
requirements as currently planned through the end of 1997. However, the
Company's cash requirements may vary materially from those now planned, due to
many factors, including, but not limited to, the progress of the Company's
research and development programs, the scope and results of preclinical and
clinical testing, changes in existing and potential relationships with corporate
collaborators, the time and cost in obtaining regulatory approvals, the costs
involved in obtaining and enforcing patents, proprietary rights and any
necessary licenses, the ability of the Company to establish development and
commercialization capacities or relationships, the costs of manufacturing and
other factors.
The Company expects to incur substantial additional costs, including costs
related to research and development activities, preclinical studies, clinical
trials, obtaining regulatory approvals, manufacturing and the expansion of its
facilities. The Company will need to raise substantial additional funds, through
additional financings including public or private equity offerings and
collaborative arrangements with corporate partners. There can be no assurance
that funds will be available on terms acceptable to the Company, if at all. If
adequate funds are not available, the Company may be required to delay, scale
back or eliminate certain of its product development programs or to license to
others the right to commercialize products or technologies that the Company
would otherwise seek to develop and commercialize itself, any of which would
have a material and adverse effect on the Company.
11
<PAGE> 12
BIOTRANSPLANT INCORPORATED
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits
4.1 Restated Certificate of Incorporation, as amended to date.
4.2 By-laws, as amended to date.
11.1 Statement: Computation of Pro Forma Net Loss Per Common Share
27 Financial Data Schedule.
b) Reports on Form 8-K
None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BioTransplant Incorporated
(Registrant)
Date: June 20, 1996 /s/ Elliot Lebowitz
---------------------------
Elliot Lebowitz
President and Chief
Executive Officer
/s/ Richard V. Capasso
---------------------------
Richard V. Capasso
Director of Finance
<PAGE> 1
EXHIBIT 4.1
RESTATED CERTIFICATE OF INCORPORATION
OF
BIOTRANSPLANT INCORPORATED
(originally Bio-Transplant, Inc. and BioTransplant, Inc.)
(Incorporated March 20, 1990)
Pursuant to Section 242 and 245
of the General Corporation Law
of the State of Delaware
BIOTRANSPLANT INCORPORATED (the "Corporation"), a corporation
organized and existing under and by virtue of the General Corporation
Law of the State of Delaware (the "General Corporation Law"), hereby
certifies as follows:
FIRST: The name of the Corporation is BioTransplant Incorporated.
A Certificate of Incorporation of the Corporation originally was filed
by the Corporation with the Secretary of State of Delaware on March 20,
1990. A Restated Certificate of Incorporation was filed on October 4,
1991 and was amended on December 12, 1991 and December 20, 1991. A
Second Amended and Restated Certificate of Incorporation was filed on
May 15, 1992. A Third Amended and Restated Certificate of Incorporation
was filed on October 29, 1993. A Fourth Amended and Restated
Certificate of Incorporation was filed on March 3, 1994. A Fifth
Amended and Restated Certificate of Incorporation was filed on August
24, 1994 and was amended on August 18, 1995. A Sixth Amended and
Restated Certificate of Incorporation was filed on October 31, 1995 and
was amended on January 23 and May 6, 1996.
SECOND: This Restated Certificate of Incorporation which restates
and integrates and further amends the Certificate of Incorporation of
the Corporation, as amended, was duly adopted in accordance with the
provisions of Section 242 and 245 of the General Corporation Law, and
was approved by written consent of the stockholders of the Corporation
given in accordance with the provisions of Section 228 of the General
Corporation Law (prompt notice of such action having been given to
those stockholders who did not consent in writing).
THIRD: The text of the Certificate of Incorporation, as
amended, is hereby restated and amended to read in its entirety as
follows:
ARTICLE I
Name
The name of the corporation is BioTransplant Incorporated.
<PAGE> 2
ARTICLE II
Purpose
The Corporation is organized to engage in any lawful act or
activity for which a corporation may be organized under the General
Corporation Law of the State of Delaware.
ARTICLE III
Capital Stock
(a) Authorization. The total number of shares of all classes of
stock which the Corporation shall have authority to issue is 27,000,000
shares, consisting of 25,000,000 shares of Common Stock, $.01 par value
per share ("Common Stock"), and 2,000,000 shares of Preferred Stock,
$.01 par value per share ("Preferred Stock").
PART A. Common Stock
A.1 General. The voting, dividend and liquidation rights of the
holders of the Common Stock are subject to and qualified by the rights
of the holders of Preferred Stock of any Series as may be designated by
the Board of Directors upon any issuance of the Preferred Stock of any
Series.
A.2 Voting. The holders of the Common Stock are entitled to one
vote for each share held at all meetings of stockholders (and written
actions in lieu of meetings). There shall be no cumulative voting.
The number of authorized shares of Common Stock may be increased
or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of
the stock of the Corporation entitled to vote, irrespective of the
provisions of Section 242(b)(2) of the General Corporation Law of
Delaware.
A.3 Dividends. Dividends may be declared and paid on the Common
Stock from funds lawfully available therefor as and when determined by
the Board of Directors and subject to any preferential dividend rights
of any then outstanding Preferred Stock.
A.4 Liquidation. Upon the dissolution or liquidation of the
Corporation, whether voluntary or involuntary, holders of Common Stock
will be entitled to receive all assets of the Corporation available for
distribution to its stockholders, subject to any preferential rights of
any then outstanding Preferred Stock.
-2-
<PAGE> 3
PART B. PREFERRED STOCK
Preferred Stock may be issued from time to time in one or more
series, each of such series to have such terms as stated or expressed
herein and in the resolution or resolutions providing for the issue of
such series adopted by the Board of Directors of the Corporation as
hereinafter provided. Any shares of Preferred Stock which may be
redeemed, purchased or acquired by the Corporation may be reissued
except as otherwise provided by law. Different series of Preferred
Stock shall not be construed to constitute different classes of shares
for the purposes of voting by classes unless expressly provided.
Authority is hereby expressly granted to the Board of Directors
from time to time to issue the Preferred Stock in one or more series,
and in connection with the creation of any such series, by resolution
or resolutions providing for the issue of the shares thereof, to
determine and fix such voting powers, full or limited, or no voting
powers, and such designations, preferences and relative participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof, including without limitation thereof, dividend
rights, conversion rights, redemption privileges and liquidation
preferences, as shall be stated and expressed in such resolutions, all
to the full extent now or hereafter permitted by the General
Corporation Law of Delaware. Without limiting the generality of the
foregoing, the resolutions providing for issuance of any series of
Preferred Stock may provide that such series shall be superior or rank
equally or be junior to the Preferred Stock of any other series to the
extent permitted by law. Except as otherwise provided in this
Certificate of Incorporation, no vote of the holders of the Preferred
Stock or Common Stock shall be a prerequisite to the designation or
issuance of any shares of any series of the Preferred Stock authorized
by and complying with the conditions of this Certificate of
Incorporation, the right to have such vote being expressly waived by
all present and future holders of the capital stock of the Corporation.
ARTICLE IV
Registered Agent
The address of the registered office of the Corporation in the
State of Delaware is Corporation Trust Center, 1209 Orange Street,
Wilmington, Delaware 19801. The name of the registered agent of the
Corporation at such address is The Corporation Trust
Company.
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ARTICLE V
By-laws
In furtherance and not in limitation of the powers conferred by
the laws of the State of Delaware, the Board of Directors is expressly
authorized to adopt, amend or repeal the By-laws of the Corporation.
ARTICLE VI
Perpetual Existence
The Corporation is to have perpetual existence.
ARTICLE VII
Amendments and Repeal
Except as otherwise specifically provided in this Restated
Certificate of Incorporation, the Corporation reserves the right at any
time, and from time to time, to amend, alter, change or repeal any
provision contained in this Restated Certificate of Incorporation, and
other provisions authorized by the laws of the State of Delaware at the
time in force may be added or inserted, in the manner now or hereafter
prescribed by law; and all rights, preferences and privileges of
whatsoever nature conferred upon stockholders, directors or any other
persons whomsoever by and pursuant to this Restated Certificate of
Incorporation in its present form or as hereafter amended are granted
subject to the rights reserved in this Article VII.
ARTICLE VIII
Compromises and Arrangements
Whenever a compromise or arrangement is proposed between the
Corporation and its creditors or any class of them and/or between the
Corporation and its stockholders or any class of them, any court of
equitable jurisdiction within the State of Delaware may, on the
application in a summary way of the Corporation or of any creditor or
stockholder thereof or on the application of any receiver or receivers
appointed for the Corporation under Section 291 of the Delaware General
Corporation Law or on the application of trustees in dissolution or of
any receiver or receivers appointed for the Corporation under Section
279 of the Delaware General Corporation Law, order a meeting of the
creditors or class or creditors, and/or of the stockholders or class of
stockholders of the Corporation, as the case may be, to be summoned in
such manner as such court directs. If a majority in number representing
three-fourths in value of the creditors or class of creditors, and/or
of the stockholders or class of stockholders of the Corporation, as the
case may be, agree to any compromise or arrangement and to any
reorganization of the
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Corporation as a consequence of such compromise or arrangement, then
such compromise or arrangement and such reorganization shall, if
sanctioned by the court to which such application has been made, be
binding on all the creditors or class of creditors, and/ or on all of
the stockholders or class of stockholders of the Corporation, as the
case may be, and also on the Corporation.
ARTICLE IX
Limitation of Liability
No director of the Corporation shall be liable to the Corporation
or its stockholders for monetary damages for breach of his or her
fiduciary duty as director; provided, however, that nothing contained
in this Article shall eliminate or limit the liability of a director:
(a) for any breach of the director's duty of loyalty to
the Corporation or its stockholders;
(b) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of the law;
(c) under Section 174 of the General Corporation Law of
the State of Delaware; or
(d) for any transaction from which the director derived
improper personal benefit.
No amendment to or repeal of this Article IX shall apply to or
have any effect on the liability or alleged liability of any director
of the Corporation for or with respect to any acts or omissions of such
director occurring prior to such amendment or repeal.
ARTICLE X
Indemnification
A. Actions, Suits and Proceedings Other than by or in the Right of
the Corporation. The Corporation shall indemnify each person who was or
is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or
in the right of the Corporation), by reason of the fact that such
person is or was, or has agreed to become, a director or officer of the
Corporation, or is or was serving, or has agreed to serve, at the
request of the Corporation, as a director, officer or trustee of, or in
a similar capacity with, another corporation, partnership, joint
venture, trust or other enterprise (including any employee benefit
plan) (all such persons being referred to hereafter as an
"Indemnitee"),
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or by reason of any action alleged to have been taken or omitted in
such capacity, against all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person or on such person's behalf in connection with
such action, suit or proceeding and any appeal therefrom, if such
person acted in good faith and in a manner such person reasonably
believed to be in, or not opposed to, the best interests of the
Corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe such person's conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person
did not act in good faith and in a manner which such person reasonably
believed to be in, or not opposed to, the best interests of the
Corporation, and, with respect to any criminal action or proceeding,
had reasonable cause to believe that such person's conduct was
unlawful. Notwithstanding anything to the contrary in this Article,
except as set forth in paragraph (G) below, the Corporation shall not
indemnify an Indemnitee seeking indemnification in connection with a
proceeding (or part thereof) initiated by the Indemnitee unless the
initiation thereof was approved by the Board of Directors of the
Corporation.
B. Actions or Suits by or in the Right of the Corporation. The
Corporation shall indemnify any Indemnitee who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that such person is or was,
or has agreed to become, a director or officer of the Corporation, or
is or was serving, or has agreed to serve, at the request of the
Corporation, as a director, officer or trustee of, or in a similar
capacity with, another corporation, partnership, joint venture, trust
or other enterprise (including any employee benefit plan), or by reason
of any action alleged to have been taken or omitted in such capacity,
against all expenses (including attorneys' fees) and amounts paid in
settlement actually and reasonably incurred by such person or on such
person's behalf in connection with such action, suit or proceeding and
any appeal therefrom, if such person acted in good faith and in a
manner such person reasonably believed to be in, or not opposed to, the
best interests of the Corporation, except that no indemnification shall
be made in respect of any claim, issue or matter as to which such
person shall have been adjudged to be liable to the Corporation unless
and only to the extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall determine upon
application that, despite the adjudication of such liability but in
view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses (including
attorneys' fees) which the Court of Chancery of Delaware or such other
court shall deem proper.
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C. Indemnification for Expenses of Successful Party.
Notwithstanding the other provisions of this Article, to the extent
that an Indemnitee has been successful, on the merits or otherwise, in
defense of any action, suit or proceeding referred to in paragraphs (A)
and (B) of this Article, or in defense of any claim, issue or matter
therein, or on appeal from any such action, suit or proceeding, the
Indemnitee shall be indemnified against all expenses (including
attorneys' fees) actually and reasonably incurred by such person or on
such person's behalf in connection therewith. Without limiting the
foregoing, if any action, suit or proceeding is disposed of, on the
merits or otherwise (including a disposition without prejudice),
without (i) the disposition being adverse to the Indemnitee, (ii) an
adjudication that the Indemnitee was liable to the Corporation, (iii) a
plea of guilty or nolo contendere by the Indemnitee, (iv) an
adjudication that the Indemnitee did not act in good faith and in a
manner reasonably believed to be in or not opposed to the best
interests of the Corporation, and (v) with respect to any criminal
proceeding, an adjudication that the Indemnitee had reasonable cause to
believe such person's conduct was unlawful, the Indemnitee shall be
considered for the purposes hereof to have been wholly successful with
respect thereto.
D. Notification and Defense of Claim. As a condition precedent to
the right to be indemnified, the Indemnitee must notify the Corporation
in writing as soon as practicable of any action, suit, proceeding or
investigation involving the Indemnitee for which indemnity will or
could be sought. With respect to any action, suit, proceeding or
investigation of which the Corporation is so notified, the Corporation
will be entitled to participate therein at its own expense and/or to
assume the defense thereof at its own expense, with legal counsel
reasonably acceptable to the Indemnitee. After notice from the
Corporation to the Indemnitee of its election so to assume such
defense, the Corporation shall not be liable to the Indemnitee for any
legal or other expenses subsequently incurred by the Indemnitee in
connection with such claim, other than as provided below in this
paragraph (D). The Indemnitee shall have the right to employ the
Indemnitee's own counsel in connection with such claim, but the fees
and expenses of such counsel incurred after notice from the Corporation
of its assumption of the defense thereof shall be at the expense of the
Indemnitee unless (i) the employment of counsel by the Indemnitee has
been authorized by the Corporation, (ii) counsel to the Indemnitee
shall have reasonably concluded that there may be a conflict of
interest or position on any significant issue between the Corporation
and the Indemnitee in the conduct of the defense of such action or
(iii) the Corporation shall not in fact have employed counsel to assume
the defense of such action, in each of which cases the fees and
expenses of counsel for the Indemnitee
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shall be at the expense of the Corporation, except as otherwise
expressly provided by this Article. The Corporation shall not be
entitled, without the consent of the Indemnitee, to assume the defense
of any claim brought by or in the right of the Corporation or as to
which counsel for the Indemnitee shall have reasonably made the
conclusion provided for in clause (ii) above.
E. Advance of Expenses. Subject to the provisions of paragraph (F)
below, in the event that the Corporation does not assume the defense
pursuant to paragraph (D) of this Article of any action, suit,
proceeding or investigation of which the Corporation receives notice
under this Article, any expenses (including attorneys' fees) incurred
by an Indemnitee in defending a civil or criminal action, suit,
proceeding or investigation or any appeal therefrom shall be paid by
the Corporation in advance of the final disposition of such matter,
provided, however, that the payment of such expenses incurred by an
Indemnitee in advance of the final disposition of such matter shall be
made only upon receipt of an undertaking by or on behalf of the
Indemnitee to repay all amounts so advanced in the event that it shall
ultimately be determined that the Indemnitee is not entitled to be
indemnified by the Corporation as authorized in this Article. Such
undertaking may be accepted without reference to the financial ability
of such person to make such repayment.
F. Procedure for Indemnification. In order to obtain
indemnification or advancement of expenses pursuant to paragraphs (A),
(B), (C) or (E) of this Article, the Indemnitee shall submit to the
Corporation a written request, including in such request such
documentation and information as is reasonably available to the
Indemnitee and is reasonably necessary to determine whether and to what
extent the Indemnitee is entitled to indemnification or advancement of
expenses. Any such indemnification or advancement of expenses shall be
made promptly, and in any event within 60 days after receipt by the
Corporation of the written request of the Indemnitee, unless with
respect to requests under paragraphs (A), (B) or (E) the Corporation
determines within such 60-day period that the Indemnitee did not meet
the applicable standard of conduct set forth in paragraphs (A) or (B),
as the case may be. Such determination shall be made in each instance
by (i) a majority vote of a quorum of the directors of the Corporation
consisting of persons who are not at that time parties to the action,
suit or proceeding in question ("disinterested directors"), (ii) if no
such quorum is obtainable, a majority vote of a committee of two or
more disinterested directors, (iii) a majority vote of a quorum of the
outstanding shares of stock of all classes entitled to vote for
directors, voting as a single class, which quorum shall consist of
stockholders who are not at that time parties to the action, suit or
proceeding in question, (iv) independent legal counsel (who may be
regular legal counsel to the Corporation), or (v) a court of competent
jurisdiction.
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G. Remedies. The right to indemnification or advances as granted
by this Article shall be enforceable by the Indemnitee in any court of
competent jurisdiction if the Corporation denies such request, in whole
or in part, or if no disposition thereof is made within the 60-day
period referred to above in paragraph (F). Unless otherwise required by
law, the burden of proving that the Indemnitee is not entitled to
indemnification or advancement of expenses under this Article shall be
on the Corporation. Neither the failure of the Corporation to have made
a determination prior to the commencement of such action that
indemnification is proper in the circumstances because the Indemnitee
has met the applicable standard of conduct, nor an actual determination
by the Corporation pursuant to paragraph (F) that the Indemnitee has
not met such applicable standard of conduct, shall be a defense to the
action or create a presumption that the Indemnitee has not met the
applicable standard of conduct. The Indemnitee's expenses (including
attorneys' fees) incurred in connection with successfully establishing
the Indemnitee's right to indemnification, in whole or in part, in any
such proceeding shall also be indemnified by the Corporation.
H. Subsequent Amendment. No amendment, termination or repeal of
this Article or of the relevant provisions of the General Corporation
Law of Delaware or any other applicable laws shall affect or diminish
in any way the rights of any Indemnitee to indemnification under the
provisions hereof with respect to any action, suit, proceeding or
investigation arising out of or relating to any actions, transactions
or facts occurring prior to the final adoption of such amendment,
termination or repeal.
I. Other Rights. The indemnification and advancement of expenses
provided by this Article shall not be deemed exclusive of any other
rights to which an Indemnitee seeking indemnification or advancement of
expenses may be entitled under any law (common or statutory), agreement
or vote of stockholders or disinterested directors or otherwise, both
as to action in such Indemnitee's official capacity and as to action in
any other capacity while holding office for the Corporation, and shall
continue as to an Indemnitee who has ceased to be a director or
officer, and shall inure to the benefit of the estate, heirs, executors
and administrators of the Indemnitee. Nothing contained in this Article
shall be deemed to prohibit, and the Corporation is specifically
authorized to enter into, agreements with officers and directors
providing indemnification rights and procedures different from those
set forth in this Article. In addition, the Corporation may, to the
extent authorized from time to time by its Board of Directors, grant
indemnification rights to other employees or agents of the Corporation
or other persons serving the Corporation and such rights may be
equivalent to, or greater or less than, those set forth in this
Article.
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J. Partial Indemnification. If an Indemnitee is entitled under any
provision of this Article to indemnification by the Corporation for
some or a portion of the expenses (including attorneys' fees),
judgments, fines or amounts paid in settlement actually and reasonably
incurred by such Indemnitee or on such Indemnitee's behalf in
connection with any action, suit, proceeding or investigation and any
appeal therefrom but not, however, for the total amount thereof, the
Corporation shall nevertheless indemnify the Indemnitee for the portion
of such expenses (including attorneys' fees), judgments, fines or
amounts paid in settlement to which the Indemnitee is entitled.
K. Insurance. The Corporation may purchase and maintain
insurance, at its expense, to protect itself and any director,
officer, employee or agent of the Corporation or another corpora-
tion, partnership, joint venture, trust or other enterprise
(including any employee benefit plan) against any expense,
liability or loss incurred by the Indemnitee in any such capacity,
or arising out of the Indemnitee's status as such, whether or not
the Corporation would have the power to indemnify such person
against such expense, liability or loss under the General
Corporation Law of Delaware.
L. Merger or Consolidation. If the Corporation is merged into or
consolidated with another corporation and the Corporation is not the
surviving corporation, the surviving corporation shall assume the
obligations of the Corporation under this Article with respect to any
action, suit, proceeding or investigation arising out of or relating to
any actions, transactions or facts occurring prior to the date of such
merger or consolidation.
M. Savings Clause. If this Article or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then
the Corporation shall nevertheless indemnify each Indemnitee as to any
expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement in connection with any action, suit, proceeding or
investigation, whether civil, criminal or administrative, including an
action by or in the right of the Corporation, to the fullest extent
permitted by any applicable portion of this Article that shall not have
been invalidated and to the fullest extent permitted by applicable law.
N. Definitions. Terms used herein and defined in
Section 145(h) and Section 145(i) of the General Corporation Law
of Delaware shall have the respective meanings assigned to such
terms in such Section 145(h) and Section 145(i).
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O. Subsequent Legislation. If the General Corporation Law of
Delaware is amended after adoption of this Article to expand further
the indemnification permitted to Indemnitees, then the Corporation
shall indemnify such persons to the fullest extent permitted by the
General Corporation Law of Delaware, as so amended.
ARTICLE XI
Special Meetings
A special meeting of the stockholders for any purpose may be
called by the Board, the Chairman of the Board, if any, the President,
the Secretary or the recordholders of at least 20% of the shares of
stock of the Corporation issued and outstanding entitled to vote at
such meeting, to be held at such place, date and hour as shall be
designated in the notice or waiver of notice thereof.
ARTICLE XII
Anti-Takeover Statute
Section 203 of the General Corporation Law of Delaware, as it may
be amended from time to time, shall apply to the Corporation.
IN WITNESS WHEREOF, the undersigned has caused this Restated
Certificate of Incorporation to be duly executed on its behalf as of
May 13, 1996.
BIOTRANSPLANT INCORPORATED
By: /s/ Elliot Lebowitz
-------------------------------
Elliot Lebowitz
President and Chief Executive
Officer
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EXHIBIT 4.2
BIO-TRANSPLANT, INC.
Incorporated under the laws
of the State of Delaware
BY-LAWS
As adopted on March 23, 1990
<PAGE> 2
BIO-TRANSPLANT, INC.
BY-LAWS
INDEX
PAGE
I. Offices
1. Registered Office
2. Other Offices
II. Meeting of Stockholders; Stockholders'
Consent in Lieu of Meeting
1. Annual Meetings
2. Special Meetings
3. Notice of Meetings
4. Quorum
5. Organization
6. Order of Business
7. Voting
8. Inspection
9. List of Stockholders
10. Stockholder's Consent in Lieu
of Meeting
III. Board of Directors
1. General Powers
2. Number and Term of Office
3. Election of Directors
4. Resignation, Removal and Vacancies
5. Meetings
(a) Annual Meetings
(b) Other Meetings
(c) Notice of Meetings
(d) Place of Meetings
(e) Quorum and Manner of Acting
(f) Organization
6. Directors' Consent in Lieu of Meeting
7. Action by Means of Conference Telephone
or Similar Communications Equipment
8. Committees
<PAGE> 3
IV. Officers
1. Executive Officers
2. Authority and Duties
3. Other Officers
4. Term of Office, Resignation and Removal
5. Vacancies
6. The Chairman of the Board
7. The President
8. The Treasurer
9. The Secretary
V. Contracts, Checks, Drafts, Bank Accounts, Etc.
1. Execution of Documents
2. Deposits
3. Proxies in Respect of Stock or Other
Securities of Other Corporations
VI. Shares and Their Transfer; Fixing Record Date
1. Certificates for Shares
2. Record
3. Transfer and Registration of Stock
4. Addresses of Stockholders
5. Lost, Destroyed and Mutilated
Certificates
6. Regulations
7. Fixing Date for Determination of
Stockholders of Record
VII. Seal
VIII. Fiscal Year
IX. Indemnification and Insurance
1. Indemnification
2. Insurance
X. Amendments
<PAGE> 4
BIO-TRANSPLANT, INC.
ARTICLE I
OFFICES
SECTION 1. Registered Office. The registered office of BIO-
TRANSPLANT, INC. (the "Corporation") in the State of Delaware
shall be at 1209 Orange Street, City of Wilmington, County of New
Castle, and the registered agent in charge thereof shall be
Corporation Trust Company.
SECTION 2. Other Offices. The Corporation may also have an
office or offices at other place or places within or without the
State of Delaware.
ARTICLE II
Meetings of Stockholders; Stockholders'
Consent in Lieu of Meeting
SECTION 1. Annual Meetings. The annual meeting of the stockholders
for the election of directors, and for the transaction of such other
business as may properly come before the meeting, shall be held at such
place, date and hour as shall be fixed by the Board of Directors (the
"Board") and designated in the notice or waiver of notice thereof;
except that no annual meeting need be held if all actions, including
the election of directors, required by the General Corporation Law of
the State of Delaware, as may be amended from time to time (the
"Delaware Statute"), to be taken at a stockholders' annual meeting are
taken by written consent in lieu of meeting pursuant to Section 10 of
this Article II.
SECTION 2. Special Meetings. A special meeting of the stockholders
for any purpose may be called by the Board, the Chairman of the Board,
if any, the President, the Secretary or the recordholders of at least a
majority of the shares of stock of the Corporation issued and
outstanding entitled to vote at such meeting, to be held at such place,
date and hour as shall be designated in the notice or waiver of notice
thereof.
SECTION 3. Notice of Meetings. Except as otherwise required by
statute or by the Certificate of Incorporation, as amended or restated
from time to time (the "Certificate of Incorporation"), or these
By-laws, notice of each annual or special meeting of the stockholders
shall be given to each stockholder of record entitled to vote at such
meeting not less than 10 or more than 60 days before the day on which
the meeting is to be held, by delivering written notice thereof to him
personally, or by mailing a copy of
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such notice, postage prepaid, directly to him at his address as it
appears in the records of the Corporation, or by transmitting such
notice to him at such address by telegraph, cable or other telephonic
transmission. Every such notice shall state the place and the date and
hour of the meeting, and, in case of a special meeting, the purposes
for which the meeting is called. Notice of any meeting of stockholders
shall not be required to be given to any stockholder who shall attend
such meeting in person or by proxy, or who shall, in person or by
attorney thereunto authorized, waive such notice in writing, either
before or after such meeting. Except as otherwise required by the
Delaware Statute or these By-laws, neither the business to be
transacted at, nor the purpose of, any meeting of the stockholders need
be specified in any such waiver of notice. Notice of any adjourned
meeting of stockholders shall not be required to be given, except when
expressly required by law.
SECTION 4. Quorum. At each meeting of the stockholders, except
where otherwise provided by the Certificate of Incorporation or these
By-laws, the holders of a majority of the issued and outstanding shares
of stock of the Corporation entitled to vote at such meeting, present
in person or represented by proxy, shall constitute a quorum for the
transaction of business. In the absence of a quorum a majority in
interest of the stockholders present in person or represented by proxy
and entitled to vote, or, in the absence of all the stockholders
entitled to vote, any officer entitled to preside at, or act as
secretary of, such meeting, shall have the power to adjourn the meeting
from time to time, until stockholders holding the requisite amount of
stock shall be present or represented. At any such adjourned meeting at
which a quorum shall be present, any business may be transacted which
might have been transacted at the meeting as originally called.
SECTION 5. Organization. At each meeting of the
stockholders, one of the following shall act as chairman of the
meeting and preside thereat, in the following order of precedence:
(a) the Chairman of the Board, if any;
(b) the President;
(c) any other officer of the Corporation designated by the
Board to act as chairman of such meeting and to preside
thereat if the Chairman of the Board, if any, or the
President shall be absent from such meeting; or
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(d) a stockholder of record who shall be chosen chairman of
such meeting by a majority in voting interest of the
stockholders present in person or by proxy and entitled
to vote thereat.
The Secretary, or if he shall be presiding over such meeting in
accordance with the provisions of this Section 5 or absent from such
meeting, the person (who shall be an Assistant Secretary, if an
Assistant Secretary has been appointed and is present) whom the
chairman of such meeting shall appoint, shall act as secretary of such
meeting and keep the minutes thereof.
SECTION 6. Order of Business. The order of business at each
meeting of the stockholders shall be determined by the chairman of such
meeting, but such order of business may be changed by a majority in
voting interest of those present in person or by proxy at such meeting
and entitled to vote thereat.
SECTION 7. Voting. Except as otherwise provided by law or by the
Certificate of Incorporation or these By-laws, at each meeting of the
stockholders, every stockholder of the Corporation shall be entitled to
one vote in person or by proxy for each share of stock of the
Corporation held by him and registered in his name on the books of the
Corporation on the date fixed pursuant to Section 7 of Article VI as
the record date for the determination of stockholders entitled to vote
at such meeting. Persons holding stock in a fiduciary capacity shall be
entitled to vote the shares so held. Persons whose stock is pledged
shall be entitled to vote, unless in the transfer by the pledgor on the
books of the Corporation, he has expressly empowered the pledgee to
vote thereon, in which case only the pledgee or his proxy may represent
such stock and vote thereon. If shares or other securities having
voting power stand in the record of two or more persons, whether
fiduciaries, members of a partnership, joint tenants, tenants in
common, tenants by the entirety or otherwise, or if two or more persons
have the same fiduciary relationship respecting the same shares, unless
the Secretary shall be given written notice to the contrary and shall
be furnished with a copy of the instrument or order appointing them or
creating the relationship wherein it is so provided, their acts with
respect to voting shall have the following effect:
(a) if only one votes, his act binds all;
(b) if more than one votes, the act of the majority so
voting binds all; and
(c) if more than one votes, but the vote is evenly split on
any particular matter, such shares shall be voted in the
manner provided by law.
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If the instrument so filed shows that any such tenancy is held in
unequal interests, a majority or even-split for the purposes of this
Section 7 shall be a majority or even-split in interest. The
Corporation shall not vote directly or indirectly any share of its own
capital stock. Any vote of stock may be given by the stockholder
entitled thereto in person or by his proxy appointed by an instrument
in writing, subscribed by such stockholder or by his attorney thereunto
authorized, delivered to the secretary of the meeting; provided,
however, that no proxy shall be voted after three years from its date,
unless said proxy provides for a longer period. At all meetings of the
stockholders at which a quorum shall be present, all matters (except
where other provision is made by law, the Certificate of Incorporation
or these By-laws) shall be decided by the vote of a majority in
interest of the stockholders present in person or by proxy at such
meeting and entitled to vote thereon. Unless demanded by a stockholder
present in person or by proxy at any meeting and entitled to vote
thereon, the vote on any question need not be by ballot. Upon a demand
by any such stockholder for a vote by ballot upon any question, such
vote by ballot shall be taken. On a vote by ballot, each ballot shall
be signed by the stockholder voting, or by his proxy, if there be such
proxy, and shall state the number of shares voted.
SECTION 8. Inspection. The chairman of the meeting may at any time
appoint two or more inspectors to serve at any meeting of the
stockholders. Any inspector may be removed, and a new inspector or
inspectors appointed, by the Board at any time. Such inspectors shall
decide upon the qualifications of voters, accept and count the votes
for and against the question, respectively, declare the results of such
vote, and subscribe and deliver to the secretary of the meeting a
certificate stating the number of shares of stock issued and
outstanding and entitled to vote thereon and the number of shares voted
for and against the question, respectively. The inspectors need not be
stockholders of the Corporation, and any director or officer of the
Corporation may be an inspector on any question other than a vote for
or against his election to any position with the Corporation or on any
other question in which he may be directly interested. Before acting as
herein provided, each inspector shall subscribe an oath faithfully to
execute the duties of an inspector with strict impartiality and
according to the best of his ability.
SECTION 9. List of Stockholders. It shall be the duty of the
Secretary or other officer of the Corporation who shall have charge of
its stock ledger to prepare and make, at least 10 days before every
meeting of the stockholders, a complete list of the stockholders
entitled to vote thereat, arranged in alphabetical order, and showing
the address of each stockholder and the number of shares registered in
the name of each stockholder. Such list
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shall be open to the examination of any stockholder, for any purpose
germane to any such meeting, during ordinary business hours, for a
period of at least 10 days prior to such meeting, either at a place
within the city where such meeting is to be held, which place shall be
specified in the notice of the meeting or, if not so specified, at the
place where the meeting is to be held. Such list shall also be produced
and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present.
SECTION 10. Stockholders' Consent In Lieu of Meeting. Any action
required by the Delaware Statute to be taken at any annual or special
meeting of such stockholders, may be taken without a meeting, without
prior notice and without a vote, by a consent in writing, as permitted
by the Delaware Statute.
ARTICLE III
Board of Directors
SECTION 1. General Powers. The business, property and affairs of
the Corporation shall be managed by or under the direction of the
Board, which may exercise all such powers of the Corporation and do all
such lawful acts and things as are not by law or by the Certificate of
Incorporation directed or required to be exercised or done by the
stockholders.
SECTION 2. Number and Term of Office. Except as may be otherwise
expressly provided by the Certificate of Incorporation, the number of
directors shall be three or such other number as shall be fixed from
time to time by the Board. Directors need not be stockholders. Each
director shall hold office until his successor is elected and
qualified, or until his earlier death or resignation or removal in the
manner hereinafter provided.
SECTION 3. Election of Directors. At each meeting of the
stockholders for the election of directors at which a quorum is
present, the persons receiving the greatest number of votes, up to the
number of directors to be elected, of the stockholders present in
person or by proxy and entitled to vote thereon shall be the directors;
provided, that no stockholder shall be allowed to cumulate his votes.
Unless an election by ballot shall be demanded as provided in Section 7
of Article II, election of directors may be conducted in any manner
approved at such meeting.
SECTION 4. Resignation, Removal and Vacancies. Any director may
resign at any time by giving written notice to the Board, the Chairman
of the Board, if any, the President or the Secretary. Such resignation
shall take effect at the time specified therein or, if the time be not
specified, upon receipt thereof; and,
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unless otherwise specified therein, the acceptance of such resignation
shall not be necessary to make it effective.
Any director or the entire Board may be removed, with or without
cause, at any time by vote of the holders of a majority of the shares
then entitled to vote at an election of directors, or by written
consent of the stockholders pursuant to Section 10 of Article II.
Vacancies occurring in the Board for any reason may be filled by
vote of the stockholders or by their written consent pursuant to
Section 10 of Article II or by vote of the Board or by the directors'
written consent pursuant to Section 6 of this Article III. Such
vacancies may be filled by vote of a majority of the directors then in
office, whether or not less than a quorum.
SECTION 5. Meetings.
(a) Annual Meetings. As soon as practicable after each annual
election of directors, the Board shall meet for the purpose of
organization and the transaction of other business, unless it shall
have transacted all such business by written consent pursuant to
Section 6 of this Article III.
(b) Other Meetings. Other meetings of the Board shall be held
at such times and places as the Board, the Chairman of the Board, if
any, the President or any two directors shall from time to time
determine.
(c) Notice of Meetings. The Secretary shall give notice to
each director of each meeting, including the time, place and purpose of
such meeting. Notice of each such meeting shall be mailed to each
director, addressed to him at his residence or usual place of business,
at least three business days before the day on which such meeting is to
be held, or shall be sent to him at such place by telegraph, cable,
wireless or other form of recorded communication, or delivered
personally or by telephone not later than 24 hours before the time at
which such meeting is to be held, but notice need not be given to any
director who shall attend such meeting. A written waiver of notice,
signed by the person entitled thereto, whether before or after the time
of the meeting stated therein, shall be deemed equivalent to notice.
(d) Place of Meetings. The Board may hold its meetings at
such place or places within or without the State of Delaware as the
Board may from time to time determine, or as shall be designated in the
respective notices or waivers of notice thereof.
(e) Quorum and Manner of Acting. A majority of the
total number of directors shall be present in person at any
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meeting of the Board in order to constitute a quorum for the
transaction of business at such meeting, and the vote of a majority of
those directors present at any such meeting at which a quorum is
present shall be necessary for the passage of any resolution or act of
the Board, except as otherwise expressly required by law, the
Certificate of Incorporation or these By-laws. In the absence of a
quorum for any such meeting, a majority of the directors present
thereat may adjourn such meeting from time to time until a quorum shall
be present.
(f) Organization. At each meeting of the Board, one of
the following shall act as chairman of the meeting and preside, in
the following order of precedence:
(i) the Chairman of the Board, if any;
(ii) the President (if a director); or
(iii) any director chosen by a majority of the
directors present.
The Secretary or, in the case of his absence, any person (who shall be
an Assistant Secretary, if an Assistant Secretary has been appointed
and is present) whom the chairman of the meeting shall appoint shall
act as secretary of such meeting and keep the minutes thereof.
SECTION 6. Directors' Consent In Lieu of Meeting. Any action
required or permitted to be taken at any meeting of the Board may be
taken without a meeting, without prior notice and without a vote, if a
consent in writing, setting forth the action so taken, shall be signed
by all the directors and such consent is filed with the minutes of the
proceedings of the Board.
SECTION 7. Action by Means of Conference Telephone or Similar
Communications Equipment. Any one or more members of the Board may
participate in a meeting of the Board by means of conference telephone
or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and participation in
a meeting by such means shall constitute presence in person at such
meeting.
SECTION 8. Committees. The Board may designate one or more
committees, each consisting of at least one director of the
Corporation, which to the extent provided in such resolution, except as
otherwise provided by the Delaware Statute, shall have and may exercise
the powers of the Board in the management of the business and affairs
of the Corporation and may authorize the seal of the Corporation to be
affixed to all papers which may require it, such committee or
committees to have such name or names as may
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be determined from time to time by resolution adopted by the Board. A
majority of all the members of any such committee may determine its
action and fix the time and place of its meetings, unless the Board
shall otherwise provide. The Board shall have the power to change the
members of any such committee at any time, either with or without
cause, to fill vacancies and to discharge any such committee, either
with or without cause, at any time.
ARTICLE IV
Officers
SECTION 1. Executive Officers. The executive officers of the
Corporation shall be a President, a Treasurer and a Secretary and may
include a Chairman of the Board and such other officers as the Board
may appoint pursuant to Section 3 of this Article IV specifically
designated as executive officers of the Corporation. Any two or more
offices may be held by the same person.
SECTION 2. Authority and Duties. All offices, as between
themselves and the Corporation, shall have such authority and perform
such duties in the management of the Corporation as may be provided in
these By-laws or, to the extent so provided, by the Board.
SECTION 3. Other Officers. The Corporation may have such other
officers, employees and agents as the Board may deem necessary,
including one or more Vice Presidents, one or more Assistant
Secretaries and one or more Assistant Treasurers, each of whom shall
hold office for such period, have such authority, and perform such
duties as the Board, the Chairman of the Board, if any, or the
President may from time to time determine. The Board may delegate to
any executive officer the power to appoint or remove any such officers,
employees and agents.
SECTION 4. Term of Office, Resignation and Removal. Subject to the
provisions of Section 3 of this Article IV, all officers shall be
elected or appointed by the Board and shall hold office for such term
as may be prescribed by the Board. Each officer shall hold office until
his successor has been elected or appointed and qualified or until his
earlier death or resignation or removal in the manner hereinafter
provided. The Board may require any officer to give security for the
faithful performance of his duties.
Any officer may resign at any time by giving written notice to the
Board, the Chairman of the Board, if any, the President or the
Secretary. Such resignation shall take effect at the time specified
therein or, if the time be not specified, at the time it is accepted by
action of the Board. Except as aforesaid, the
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acceptance of such resignation shall not be necessary to make it
effective.
Each officer, employee and agent shall be subject to removal at
any time by the Board or by the stockholders of the Corporation, or by
any executive officer to whom the Board has delegated the power to
remove such officer, employee or agent, with or without cause.
SECTION 5. Vacancies. If the office of President, Treasurer or
Secretary becomes vacant for any reason, the Board shall fill such
vacancy, and if any other office becomes vacant, the Board or any
executive officer to whom the Board has delegated such power may fill
such vacancy. Any officer appointed or elected to fill any vacancy
shall serve only until such time as the unexpired term of his
predecessor shall have expired unless otherwise provided upon such
appointment or election or unless reappointed or reelected.
SECTION 6. The Chairman of the Board. If there shall be a Chairman
of the Board, he shall preside at meetings of the Board and of the
stockholders at which he is present, and shall give counsel and advice
to the Board and the officers of the Corporation on all subjects
concerning the welfare of the Corporation and the conduct of its
business. He shall perform such other duties as the Board may from time
to time determine.
SECTION 7. The President. The President shall be the chief
executive officer of the Corporation, and unless a Chairman of the
Board shall be appointed and present, the president shall preside at
all meetings of the Board (if he is a director) and of the stockholders
at which he is present. The President shall have general and active
management and control of the business and affairs of the Corporation
subject to the control of the Board, and shall see that all orders and
resolutions of the Board are carried into effect.
SECTION 8. The Treasurer. The Treasurer shall have the care and
custody of the corporate funds and other valuable effects, including
securities, and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation, and shall deposit
all moneys and other valuable effects in the name and to the credit of
the Corporation in such depositories as may be designated by the Board.
The Treasurer shall disburse the funds of the Corporation as may be
ordered by the Board, taking proper vouchers for such disbursements,
and shall render to the Chairman of the Board, if any, the President
and the directors, at regular meetings of the Board, or whenever they
may require it, an account of all his transactions as Treasurer and of
the financial condition of the Corporation, and shall perform all other
duties
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incident to the office of Treasurer and such other duties as from time
to time may be assigned to him by the Chairman of the Board, if any,
the President or the Board.
SECTION 9. The Secretary. The Secretary shall, to the extent
practicable, attend all meetings of the Board and all meetings of the
stockholders and shall record all votes and the minutes of all
proceedings in a book to be kept for that purpose. He shall give, or
cause to be given, notice of all meetings of the stockholders and of
the Board. He shall keep in safe custody the seal of the Corporation
and affix the same to any duly authorized instrument requiring it and,
when so affixed, it shall be attested by his signature or by the
signature of the Treasurer, an Assistant Treasurer or an Assistant
Secretary. He shall keep in safe custody the certificate books and
stockholder records and such other books and records as the Board may
direct and shall perform all other duties incident to the office of
Secretary and such other duties as from time to time may be assigned to
him by the Chairman of the Board, if any, the President or the Board.
ARTICLE V
Contracts, Checks, Drafts, Bank Accounts, Etc.
SECTION 1. Execution of Documents. The Board shall designate the
officers, employees and agents of the Corporation who shall have power
to execute and deliver deeds, contracts, mortgages, bonds, debentures,
checks, drafts and other orders for the payment of money and other
documents for and in the name of the Corporation (including the power
to affix the seal of the Corporation and to attest thereto), and may
authorize such officers, employees and agents to delegate such power
(including authority to redelegate) by written instrument to other
officers, employees or agents of the Corporation; and, unless so
designated or expressly authorized by these By-laws, no officer,
employee or agent shall have any power or authority to bind the
Corporation by any contract or engagement, to pledge its credit or to
render it liable pecuniarily for any purpose or to any amount.
SECTION 2. Deposits. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the
Corporation or otherwise as the Board, the Treasurer or any other
officer of the Corporation to whom power in this respect shall have
been given by the Board, shall select.
SECTION 3. Proxies in Respect of Stock or Other Securities of
Other Corporations. The Board shall designate the officers of the
Corporation who shall have authority from time to time to appoint an
agent or agents of the Corporation to exercise in the name and on
behalf of the Corporation the powers and rights which
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the Corporation may have as the holder of stock or other securities in
any other corporation, and to vote or consent in respect of such stock
or securities. Such designated officers may instruct the person or
persons so appointed as to the manner of exercising such powers and
rights, and such designated officers may execute or cause to be
executed in the name and on behalf of the Corporation and under its
corporate seal or otherwise, such written proxies, powers of attorney
or other instruments as they may deem necessary or proper in order that
the Corporation may exercise its powers and rights.
ARTICLE VI
Shares and Their Transfer; Fixing Record Date
SECTION 1. Certificates for Shares. Every owner of stock of the
Corporation shall be entitled to have a certificate certifying the
number and class or series of shares owned by him in the Corporation,
which shall be in such form as shall be prescribed by the Board.
Certificates shall be numbered and issued in consecutive order and
shall be signed by, or in the name of, the Corporation by the Chairman
of the Board, if any, the President or any Vice President and by the
Treasurer (or an Assistant Treasurer) or the Secretary (or an Assistant
Secretary). In case any officer or officers who shall have signed any
such certificate or certificates shall cease to be such officer or
officers of the Corporation, whether because of death, resignation or
otherwise, before such certificate or certificates shall have been
delivered by the Corporation, such certificate or certificates may
nevertheless be adopted by the Corporation and be issued and delivered
as though the person or persons who signed such certificate had not
ceased to be such officer or officers of the Corporation.
SECTION 2. Record. A record in one or more counterparts shall be
kept of the name of the person, firm or corporation owning the shares
represented by each certificate for stock of the Corporation issued,
the number of shares represented by each such certificate, the date
thereof and, in the case of cancellation, the date of cancellation.
Except as otherwise expressly required by law, the person in whose name
shares of stock stand on the stock record of the Corporation shall be
deemed the owner thereof for all purposes as regards the Corporation.
SECTION 3. Transfer and Registration of Stock.
(a) The transfer of stock and certificates of stock which
represent the stock of the Corporation shall be governed by Article 8
of Subtitle 1 of Title 6 of the Delaware Code (the Uniform Commercial
Code), as amended from time to time.
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(b) Registration of transfers of shares of the Corporation
shall be made only on the books of the Corporation upon request of the
registered holder thereof, or of his attorney thereunto authorized by
power of attorney duly executed and filed with the Secretary of the
Corporation, and upon the surrender of the certificate or certificates
for such shares properly endorsed or accompanied by a stock power duly
executed.
SECTION 4. Addresses of Stockholders. Each stockholder shall
designate to the Secretary an address at which notices of meetings and
all other corporate notices may be served or mailed to him, and, if any
stockholder shall fail to designate such address, corporate notices may
be served upon him by mail directed to him at his post office address,
if any, as the same appears on the share record books of the
Corporation or at his last known post office address.
SECTION 5. Lost, Destroyed and Mutilated Certificates. The holder
of any shares of the Corporation shall immediately notify the
Corporation of any loss, destruction or mutilation of the certificate
therefor, and the Board may, in its discretion, cause to be issued to
him a new certificate or certificates for shares, upon the surrender of
the mutilated certificates or, in the case of loss or destruction of
the certificate, upon satisfactory proof of such loss or destruction,
and the Board may, in its discretion, require the owner of the lost or
destroyed certificate or his legal representative to give the
Corporation a bond in such sum and with such surety or sureties as it
may direct to indemnify the Corporation against any claim that may be
made against it on account of the alleged loss or destruction of any
such certificate.
SECTION 6. Regulations. The Board may make such rules and
regulations as it may deem expedient, not inconsistent with these
By-laws, concerning the issue, transfer and registration of
certificates for stock of the Corporation.
SECTION 7. Fixing Date for Determination of Stockholders of
Record.
(a) In order that the Corporation may determine the
stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, the Board may fix a record
date, which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board, and which
record date shall be not more than 60 nor less than 10 days before the
date of such meeting. If no record date is fixed by the Board, the
record date for determining stockholders entitled to notice of or to
vote at a meeting of stockholders shall be at the close of business on
the day next
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preceding the day on which notice is given, or, if notice is waived, at
the close of business on the day next preceding the day on which the
meeting is held. A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall apply to any
adjournment of the meeting; provided, however, the Board may fix a new
record date for the adjourned meeting.
(b) In order that the Corporation may determine the
stockholders entitled to consent to corporate action in writing without
a meeting, the Board may fix a record date, which record date shall not
precede the date upon which the resolution fixing the record date is
adopted by the Board, and which date shall be not more than 10 days
after the date upon which the resolution fixing the record date is
adopted by the Board. If no record date has been fixed by the Board,
the record date for determining stockholders entitled to consent to
corporate action in writing without a meeting, when no prior action by
the Board is required by the Delaware Statute, shall be the first date
on which a signed written consent setting forth the action taken or
proposed to be taken is delivered to the Corporation by delivery to its
registered office in this State, its principal place of business, or an
officer or agent of the Corporation having custody of the book in which
proceedings of meetings of stockholders are recorded. Delivery made to
the Corporation's registered office shall be by hand or by certified or
registered mail, return receipt requested. If no record date has been
fixed by the Board and prior action by the Board is required by the
Delaware Statute, the record date for determining stockholders entitled
to consent to corporate action in writing without a meeting shall be at
the close of business on the day on which the Board adopts the
resolution taking such prior action.
(c) In order that the Corporation may determine the
stockholders entitled to receive payment of any dividend or other
distribution or allotment of any rights or the stockholders entitled to
exercise any rights in respect of any change, conversion or exchange of
stock, or for the purpose of any other lawful action, the Board may fix
a record date, which record date shall not precede the date upon which
the resolution fixing the record date is adopted, and which record date
shall be not more than 60 days prior to such action. If no record date
is fixed, the record date for determining stockholders for any such
purpose shall be at the close of business on the day on which the Board
adopts the resolution relating thereto.
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ARTICLE VII
Seal
The Board may provide a corporate seal, which shall be in the form
of a circle and shall bear the full name of the Corporation and the
words and figures "Corporate Seal, -- 1990 Delaware."
ARTICLE VII
Fiscal Year
The fiscal year of the Corporation shall be the calendar year
unless otherwise determined by the Board.
ARTICLE IX
Indemnification and Insurance
SECTION 1. Indemnification.
(a) As provided in the Certificate of Incorporation, to the
fullest extent permitted by the Delaware Statute, a director of this
Corporation shall not be liable to the Corporation or its stockholders
for breach of fiduciary duty as a director.
(b) Without limitation of any provision eliminating or
limiting the liability of a director pursuant to the Delaware Statute,
any person who was or is made a party or is threatened to be made a
party to or is otherwise involved in any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (hereinafter a "proceeding"), by reason
of the fact that he or she is or was a director, officer, employee or
agent of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan
(hereinafter an "indemnitee"), whether the basis of such proceeding is
alleged action in an official or in any other capacity while holding
such office, shall be indemnified and held harmless by the Corporation
to the fullest extent authorized by the Delaware Statute, as the same
exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the
Corporation to provide broader indemnification rights than permitted
prior thereto), against all expense, liability and loss (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and
amounts paid in settlement) actually and reasonably incurred or
suffered by such indemnitee in connection therewith, and such
indemnification shall continue as to an
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indemnitee who has ceased to be a director or designated officer and
shall inure to the benefit of the indemnitee's heirs, executors and
administrators; provided, however, that, except as provided in Section
1(c) of this Article IX with respect to proceedings to enforce rights
to indemnification, the Corporation shall indemnify any such indemnitee
in connection with a proceeding initiated by such indemnitee only if
such proceeding initiated by such indemnitee was authorized by the
Board. The right to indemnification cornered in this Article IX shall
be a contract right and shall include the right to be paid by the
Corporation the expenses incurred in defending any such proceeding in
advance of its final disposition (hereinafter an "advancement of
expenses"); only upon delivery to the Corporation of an undertaking
(hereinafter an "undertaking"), by or on behalf of such indemnitee, to
repay all amounts so advanced if it shall ultimately be determined by
final judicial decision from which there is no further right to appeal
(hereinafter a "final adjudication") that such indemnitee is not
entitled to be indemnified for such expenses under this Section or
otherwise.
(c) If a claim under Section 1(b) of this Article IX is not
paid in full by the Corporation within 60 days after a written claim
has been received by the Corporation, except in the case of a claim for
an advancement of expenses, in which case the applicable period shall
be 20 days, the indemnitee may at any time thereafter bring suit
against the Corporation to recover the unpaid amount of the claim. If
successful in whole or in part in any such suit, or in a suit brought
by the Corporation to recover an advancement of expenses pursuant to
the terms of any undertaking, the indemnitee shall be entitled to be
paid also the expenses of prosecuting or defending such suit. In (i)
any suit brought by the indemnitee to enforce a right to
indemnification hereunder (but not in a suit brought by the indemnitee
to enforce a right to an advancement of expenses) it shall be a defense
that, and (ii) any suit by the Corporation to recover an advancement of
expenses pursuant to the terms of an undertaking the Corporation shall
be entitled to recover such expenses upon a final adjudication that,
the indemnitee has not met the applicable standard of conduct set forth
in the Delaware Statute. Neither the failure of the Corporation
(including the Board, independent legal counsel or stockholders) to
have made a determination prior to the commencement of such suit that
indemnification of the indemnitee is proper in the circumstances
because the indemnitee has met the applicable standard of conduct set
forth in the Delaware Statute, nor an actual determination by the
Corporation (including the Board, independent legal counsel or
stockholders) that the indemnitee has not met such applicable standard
of conduct, shall create a presumption that the indemnitee has not met
the applicable standard of conduct or, in the case of such a suit
brought by the indemnitee, be a defense to such suit. In any
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suit brought by the indemnitee to enforce a right to indemnification or
to an advancement of expenses hereunder, or by the Corporation to
recover an advancement of expenses pursuant to the terms of an
undertaking, the burden of proving that the indemnitee is not entitled
to be indemnified, or to such advancement of expenses, under this
Section or otherwise shall be on the Corporation.
(d) The rights to indemnification and the advancement of
expenses conferred in this Article IX shall not be exclusive of any
other rights which any person may have or hereafter acquire pursuant to
any statute, the Certificate of Incorporation, agreement, vote of
stockholders or disinterested directors or otherwise.
SECTION 2. Insurance. The Corporation may purchase and maintain
insurance, at its expense, on behalf of any person who is or was a
director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a director, officer,
employee or agent of another Corporation, partnership, joint venture,
trust or other enterprise, against any expense, liability or loss,
whether or not the Corporation would have the power to indemnify such
person against such expense, liability or loss under this Article IX or
the Delaware Statute.
ARTICLE X
Amendments
Any by-law (including these By-laws) may be adopted, amended or
repealed by the vote of the holders of a majority of the shares then
entitled to vote at an election of directors or by consent of such
stockholders pursuant to Section 10 of Article II, or by vote of the
Board or by the directors' written consent pursuant to Section 6 of
Article III.
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AMENDMENT TO BYLAWS
The Bylaws of BioTransplant, Inc. be and hereby are amended
as follows:
1. Article II, Section 2 of the Bylaws is hereby deleted in its
entirety and a new Section 2 inserted in lieu thereof which shall read
as follows:
"SECTION 2. Special Meetings. A special meeting of the
stockholders for any purpose may be called by the Board, the
Chairman of the Board, if any, the President, the Secretrary
or the recordholders of at least 20% of the shares of stock
of the Corporation issued and outstanding entitled to vote at
such meeting, to be held at such place, date and hour as
shall be designated in the notice or waiver of notice
thereof."
2. New Sections 11 and 12 will be added to Article II which shall
read in their entirety as follows:
"SECTION 11. Nomination of Directors. Only persons who are
nominated in accordance with the following procedures shall
be eligible for election as directors. Nomination for
election to the Board of Directors of the corporation at a
meeting of stockholders may be made by the Board of Directors
or by any stockholder of the corporation entitled to vote for
the election of directors at such meeting who complies with
the notice procedures set forth in this Section 11. Such
nominations, other than those made by or on behalf of the
Board of Directors or by a stockholder owning more than 5% of
the outstanding capital stock of the Corporation, shall be
made by notice in writing delivered or mailed by first class
United States mail, postage prepaid, to the Secretary, and
received not less than 60 days nor more than 90 days prior to
such meeting; provided, however, that if less than 70 days'
notice or prior public disclosure of the date of the meeting
is given to stockholders, such nomination shall have been
mailed or delivered to the Secretary not later than the close
of business on the 10th day following the date on which the
notice of the meeting was mailed or such public disclosure
was made, whichever occurs first. Such notice shall set forth
(a) as to each proposed nominee (i) the name, age, business
<PAGE> 21
address and, if known, residence address of each such
nominee, (ii) the principal occupation or employment of each
such nominee, (iii) the number of shares of stock of the
corporation which are beneficially owned by each such
nominee, and (iv) any other information concerning the
nominee that must be disclosed as to nominees in proxy
solicitations pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (including such person's
written consent to be named as a nominee and to serve as a
director if elected); and (b) as to the stockholder giving
the notice (i) the name and address, as they appear on the
corporation's books, of such stockholder and (ii) the class
and number of shares of the corporation which are
beneficially owned by such stockholder. The corporation may
require any proposed nominee to furnish such other
information as may reasonably be required by the corporation
to determine the eligibility of such proposed nominee to
serve as a director of the corporation.
The chairman of the meeting may, if the facts warrant,
determine and declare to the meeting that a nomination was
not made in accordance with the foregoing procedure, and if
he should so determine, he shall so declare to the meeting
and the defective nomination shall be disregarded."
"SECTION 12. Notice of Business at Annual Meetings. At an
annual meeting of the stockholders, only such business shall
be conducted as shall have been properly brought before the
meeting. To be properly brought before an annual meeting,
business must be (a) specified in the notice of meeting (or
any supplement thereto) given by or at the direction of the
Board of Directors, (b) otherwise properly brought before the
meeting by or at the direction of the Board of Directors, or
(c) otherwise properly brought before an annual meeting by a
stockholder. For business to be properly brought before an
annual meeting by a stockholder, owning less than 5% of the
outstanding capital stock of the Corporation, the stockholder
must have given timely notice thereof in writing to the
Secretary. To be timely, a stockholder's notice must be
delivered to or mailed and received at the principal
executive offices of the corporation not less than 60 days
nor more than 90 days prior to the meeting; provided,
however, that in the event that less than 70 days' notice or
<PAGE> 22
prior public disclosure of the date of the meeting is given
or made to stockholders, notice by the stockholder to be
timely must be so received not later than the close of
business on the 10th day following the date on which such
notice of the date of the meeting was mailed or such public
disclosure was made, whichever occurs first. A stockholder's
notice to the Secretary shall set forth as to each matter the
stockholder proposes to bring before the annual meeting (a) a
brief description of the business desired to be brought
before the annual meeting and the reasons for conducting such
business at the annual meeting, (b) the name and address, as
they appear on the corporation's books, of the stockholder
proposing such business, (c) the class and number of shares
of the corporation which are beneficially owned by the
stockholder, and (d) any material interest of the stockholder
in such business. Notwithstanding anything in these By-Laws
to the contrary, no business shall be conducted at any annual
meeting except in accordance with the procedures set forth in
this Section 1.11 and except that any stockholder proposal
which complies with Rule 14a-8 of the proxy rules (or any
successor provision) promulgated under the Securities
Exchange Act of 1934, as amended, and is to be included in
the corporation's proxy statement for an annual meeting of
stockholders shall be deemed to comply with the requirements
of this Section 1.11.
The chairman of the meeting shall, if the facts warrant,
determine and declare to the meeting that business was not
properly brought before the meeting in accordance with the
provisions of this Section 1.11, and if he should so
determine, the chairman shall so declare to the meeting that
any such business not properly brought before the meeting
shall not be transacted."
ADOPTED BY THE BOARD OF DIRECTORS ON MARCH 1, 1996.
<PAGE> 1
EXHIBIT 11.1
BIOTRANSPLANT INCORPORATED
<TABLE>
COMPUTATION OF PRO FORMA NET LOSS PER COMMON SHARE (1)
<CAPTION>
THREE MONTHS ENDED MARCH 31,
1995 1996
------------- -----------
<S> <C> <C>
Net Loss................................................................ $(2,719,434) $ (987,947)
=========== ==========
Shares Used in Computing Pro Forma Net Loss Per Common Share:
Weighted Average Common Stock Outstanding During the Period........ 120,035 126,594
Conversion of Redeemable Convertible Preferred Stock(2)............ 3,212,896 4,328,704
Dilutive Effect of Common Equivalent Shares Issued Subsequent to
March 1, 1995(3)................................................. 676,048 676,048
----------- ----------
4,008,979 5,131,346
=========== ==========
Pro Forma Net Loss Per Common Share..................................... $ (.68) $ (.19)
=========== ==========
<FN>
- ---------------
(1) Historical net loss per common share has not been separately presented, as the amounts would not be
meaningful.
(2) Effective with the closing of the Company's initial public offering of common stock, all shares of
redeemable convertible preferred stock automatically converted into shares of common stock.
Accordingly the equivalent number of weighted average common shares that would have been outstanding
during each period presented have been included as outstanding.
(3) Pursuant to Securities and Exchange Commission Staff Accounting Bulletin No. 83, common stock,
preferred stock, stock options and warrants issued at prices below the initial public offering price
per share ("cheap stock") during the twelve month period immediately preceding the filing date of the
Company's Registration Statement for its initial public offering have been included as outstanding for
all periods presented. The dilutive effect of the common and common stock equivalents was computed in
accordance with the treasury stock method.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET @ MARCH 31, 1996 AND THE CONSOLIDATED STATEMENT
OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH CONSOLIDATED FINANCIAL STATEMENTS
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 6,167,920
<SECURITIES> 0
<RECEIVABLES> 24,168
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 6,565,609
<PP&E> 3,670,891
<DEPRECIATION> 1,986,592
<TOTAL-ASSETS> 8,407,384
<CURRENT-LIABILITIES> 1,542,264
<BONDS> 0
<COMMON> 1,266
36,186,820
0
<OTHER-SE> (29,829,415)
<TOTAL-LIABILITY-AND-EQUITY> 8,407,384
<SALES> 0
<TOTAL-REVENUES> 2,075,697
<CGS> 0
<TOTAL-COSTS> 3,012,436
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 51,208
<INCOME-PRETAX> (987,947)
<INCOME-TAX> 0
<INCOME-CONTINUING> (987,947)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (987,947)
<EPS-PRIMARY> (.19)
<EPS-DILUTED> (.19)
</TABLE>
