EXECUTION COPY
5,263,902 American Depositary Shares
(Representing 15,791,706 Ordinary Shares)
Shire Pharmaceuticals Group plc
UNDERWRITING AGREEMENT
September 25, 2000
BEAR, STEARNS & CO. INC.
245 Park Avenue
New York, NY 10167
Ladies and Gentlemen:
The shareholder named in Schedule I hereto (the "Selling Shareholder")
proposes, subject to the terms and conditions stated herein, to sell to Bear,
Stearns & Co. Inc. (the "Underwriter") 5,263,902 American Depositary Shares (the
"ADSs"), each representing the right to receive three ordinary shares, nominal
value 5p per ordinary share (each, an "ordinary share"), of Shire
Pharmaceuticals Group plc, a public limited liability company organized under
the laws of England and Wales (the "Company"). The ADSs and the ordinary shares
are more fully described in the Registration Statement referred to below.
1. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the Underwriter that:
(a) The Company has filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended (the "Act"), and the rules and regulations of the Commission
thereunder (the "Regulations") a registration statement and one or more
amendments thereto, on Form S-3 (No. 333-39702), for the registration under the
Act of certain ordinary shares, including all of the ordinary shares underlying
the ADSs (such ordinary shares underlying the ADSs covered by the Registration
Statement hereinafter being referred to as the "Registered Shares"). The Company
meets the requirements for use of Form S-3 for registering the Registered
Shares. The Registration Statement has been declared effective under the Act.
Such registration statement, including the prospectus, financial statements and
schedules, exhibits and all other documents filed as a part thereof, as amended
to the date of this Agreement, including any information deemed to be a part
thereof as of the date hereof pursuant to paragraph (b) of Rule 430A of the
Regulations, is herein called the "Registration Statement" and the related
prospectus covering the Registered Shares as supplemented by any specifically
applicable supplement relating to the sale of the ADSs, in the form first used
to confirm sales of the ADSs, is herein called the "Prospectus". Any
registration
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statement filed pursuant to Rule 462(b) of the Regulations is herein called the
"Rule 462(b) Registration Statement", and after such filing any reference herein
to the term "Registration Statement" shall include such Rule 462(b) Registration
Statement. Any reference herein to the Registration Statement or the Prospectus
shall be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), on or before the date of
this Agreement, or the date of the Prospectus, as the case may be, and any
reference herein to the terms "amend," "amendment" or "supplement" with respect
to the Registration Statement or the Prospectus shall be deemed to refer to and
include (A) the filing of any document under the Exchange Act after the date of
this Agreement or the date of the Prospectus, as the case may be, which is
incorporated therein by reference and (B) any such document as filed. All of the
Registered Shares have been duly registered under the Act pursuant to the
Registration Statement or, if any Rule 462(b) Registration Statement is filed,
have been or will be duly registered under the Act with the filing of such Rule
462(b) Registration Statement. Neither the Commission nor the Blue Sky or
securities authority of any jurisdiction has issued a stop order suspending the
effectiveness of the Registration Statement, preventing or suspending the use of
the Prospectus, the Registration Statement or any amendment or supplement
thereto, refusing to permit the effectiveness of the Registration Statement or
suspending the registration or qualification of the Registered Shares, nor has
any of such authorities instituted, or, to the Company's knowledge, threatened
to institute any proceedings with respect to a stop order.
(b) At the time of the effectiveness of the Registration Statement or any
Rule 462(b) Registration Statement or the effectiveness of any post-effective
amendment to the Registration Statement, when the Prospectus or any supplement
to or amendment of the Prospectus is filed with the Commission and at the
Closing Date (as hereinafter defined), the Registration Statement and the
Prospectus and any amendments thereof and supplements thereto complied or will
comply in all material respects with the applicable provisions of the Act and
the Regulations and does not or will not contain an untrue statement of a
material fact and does not or will not omit to state any material fact required
to be stated therein or necessary in order to make the statements therein (i) in
the case of the Registration Statement, not misleading and (ii) in the case of
the Prospectus, in light of the circumstances under which they were made, not
misleading. No representation and warranty is made in this subsection (b),
however, with respect to any information contained in or omitted from the
Registration Statement or the Prospectus or any related preliminary prospectus
or any amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by you or by the
Selling Shareholder, in each case expressly for use in connection with the
preparation thereof. Each contract, agreement, instrument, lease, license or
other item required to be described in the Registration Statement or the
Prospectus or filed as an exhibit to the Registration Statement has been so
described or filed.
(c) The reports and other documents incorporated by reference in the
Registration Statement and the Prospectus, as of the date hereof or the date of
the Prospectus, as the case may be, complied in all material respects to the
requirements of the Act and the Regulations, and none of such documents
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
and any
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further reports or documents so filed and incorporated by reference in the
Registration Statement and the Prospectus or any further amendment or supplement
thereto, when such documents become effective or are filed with the Commission,
as the case may be, will comply in all material respects to the requirements of
the Act and the Regulations or the Exchange Act and the rules and regulations of
the Commission promulgated thereunder, as applicable, and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(d) A registration statement on Form F-6 (File No. 333-8414) in respect of
the ADSs has been filed with the Commission; such registration statement has
been declared effective by the Commission; no stop order suspending the
effectiveness of such registration statement has been issued and no proceeding
for that purpose has been initiated or, to the Company's knowledge, threatened
by the Commission or the Blue Sky or securities authority of any jurisdiction
(such registration statement, as amended at the time such registration statement
became effective, is herein called the "F-6 Registration Statement"); and the
F-6 Registration Statement when it became effective conformed, and any further
amendments thereto will conform, in all material respects, with the requirements
of the Act, and did not and will not, as of the applicable effective date,
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading.
(e) The Deposit Agreement among the Company, Morgan Guaranty Trust Company
of New York, as depositary (the "Depositary"), and the holders and beneficial
owners from time to time of ADSs issued thereunder (the "Deposit Agreement"),
and the transactions contemplated therein, have been duly and validly authorized
by the Company; and the Deposit Agreement has been duly and validly executed and
delivered by the Company and is enforceable against the Company in accordance
with its terms, except as enforcement (i) may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the enforcement of creditors' rights generally and (ii) is subject to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or law). The Company has validly deposited
the Registered Shares with the Depositary against the issuance, by the
Depositary, of certificates for ADSs representing the Registered Shares in
accordance with the Deposit Agreement.
(f) Arthur Andersen Chartered Accountants, who have certified the financial
statements and supporting schedules of the Company included in the Registration
Statement, are independent public accountants in respect of the Company as
required by the Act and the Regulations. Ernst & Young LLP and
PricewaterhouseCoopers LLP, who have certified (each as of certain dates and
with respect to certain periods) the financial statements and supporting
schedules of Roberts Pharmaceutical Corporation ("Roberts Pharmaceutical"), are
independent public accountants in respect of Roberts Pharmaceutical as required
by the Act and the Regulations.
(g) The Company does not have any subsidiaries other than those listed on
Schedule II and does not own or control, directly or indirectly, any interest in
any other
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corporation, association or other business entity. All the issued and
outstanding shares of capital stock of each subsidiary of the Company have been
duly and validly issued and are fully paid and nonassessable, were not issued in
violation of preemptive or similar rights (unless such rights have been duly
waived by the holders of such rights) and are owned directly or indirectly by
the Company, free and clear (other than (i) as set forth in that certain Amended
and Restated Credit Agreement among the Company, its subsidiaries, certain
financial institutions and DLJ Capital Fund Inc. as administrative agent dated
November 19, 1999 and (ii) directors' qualifying shares) of any lien,
encumbrance, claim, security interest, restriction on transfer, shareholders'
agreement, voting trust or other defect of title whatsoever.
(h) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as set forth in the
Registration Statement and the Prospectus, there has been no material adverse
change in the business, prospects, properties, operations, condition (financial
or other) or results of operations of the Company and its subsidiaries, taken as
a whole ("Material Adverse Change"), whether or not arising from transactions in
the ordinary course of business, and since the date of the latest balance sheet
of the Company presented in the Registration Statement and the Prospectus, (i)
neither the Company nor any of its subsidiaries has (A) incurred or undertaken
any liabilities or obligations, direct or contingent, which are material to the
Company and its subsidiaries, taken as a whole, except for liabilities or
obligations which are reflected in the Registration Statement and the
Prospectus, or (B) entered into any transaction not in the ordinary course of
business that is material to the Company and its subsidiaries taken as a whole,
except for transactions which are reflected in the Registration Statement and
the Prospectus; and (ii) the Company has not declared or paid any dividend on or
made any distributions of or with respect to any shares of its capital stock or
redeemed, purchased or otherwise acquired or agreed to redeem, purchase or
otherwise acquire any shares of its or its subsidiaries' capital stock.
(i) This Agreement and the transactions contemplated herein have been duly
and validly authorized by the Company, and this Agreement has been duly and
validly executed and delivered by the Company and is enforceable against the
Company in accordance with its terms, except as enforcement (i) may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors' rights and remedies generally and (ii) is
subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or law).
(j) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby do not and will not (i)
conflict with or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or both,
would constitute a default) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, any contract, agreement, instrument,
understanding, franchise, license or permit to which the Company or any of its
subsidiaries is a party or by which any of such companies or any of their
respective properties or assets may be bound, except where such conflict,
breach, default, lien, charge or encumbrance would not have a material adverse
effect (considered individually or when aggregated with other such instances) on
the business, prospects, properties, operations, condition (financial or other)
or results of operations of the
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Company and its subsidiaries, taken as a whole (a "Material Adverse Effect"), or
(ii) violate or conflict with any provision of the memorandum and articles of
association or by-laws or equivalent constitutive documents of the Company or
any of its subsidiaries or any judgment, decree, order, statute, rule or
regulation of any court or any public, governmental or regulatory agency or body
having jurisdiction over the Company or any of its subsidiaries or any of their
respective properties or assets, except where such violation or conflict would
not have a Material Adverse Effect. No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any court or
any public, governmental or regulatory agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their respective properties or
assets is required for the execution, delivery or performance of this Agreement
or the consummation of the transactions contemplated hereby, including the sale
and delivery of the ADSs, except the registration under the Act of the
Registered Shares (which has become effective) and such consents, approvals,
authorizations, orders, registrations, filings, qualifications, licenses and
permits as may be required under state securities or Blue Sky laws or foreign
equivalents of such regulations or statutes, where applicable, in connection
with the purchase and distribution of the ADSs by the Underwriter.
(k) The Company had, at June 30, 2000, an authorized and outstanding
capitalization as set forth in the Registration Statement and the Prospectus.
Schedule III hereto sets forth the outstanding number of shares of each class of
capital stock of the Company as of the close of business the day before the date
of this Agreement. All of the outstanding shares of capital stock of the
Company, including the Registered Shares, are duly and validly authorized,
allotted and issued as fully paid, and none of such shares was issued in
violation of or is subject to any preemptive or similar rights. The authorized
capital stock of the Company, including the Registered Shares, conforms to the
description thereof contained in the Registration Statement and the Prospectus.
Each ADS represents the right to receive three ordinary shares pursuant to the
procedures set forth in the Deposit Agreement. The ADSs conform to the
description thereof contained in the Registration Statement and the Prospectus.
Except as disclosed in the Registration Statement and the Prospectus or in
Schedule III hereto, there are no outstanding options (as of August 31, 2000),
warrants or other rights calling for the issuance of, and no commitments,
obligations, plans or arrangements to issue, any shares of capital stock of the
Company or any security convertible into or exchangeable for capital stock of
the Company.
(l) The execution, delivery and performance of the Deposit Agreement and
the consummation of the transactions contemplated thereby did not and will not
(i) conflict with or result in a breach of any of the terms and provisions of,
or constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, any contract, agreement, instrument,
understanding, franchise, license or permit to which the Company or any of its
subsidiaries is a party or by which any of such companies or any of their
respective properties or assets may be bound, except where such conflict,
breach, default, lien or encumbrance would not have a Material Adverse Effect,
or (ii) violate or conflict with any provision of the memorandum and articles of
association or by-laws or equivalent constitutive documents of the Company or
any of its subsidiaries or any judgment, decree, order, statute, rule or
regulation of any court or any public, governmental or regulatory agency or body
having jurisdiction over the Company or any
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of its subsidiaries or any of their respective properties or assets, except
where such violation or conflict would not have a Material Adverse Effect. No
consent, approval, authorization, order, registration, filing, qualification,
license or permit of or with any court or any public, governmental or regulatory
agency or body having jurisdiction over the Company or any of its subsidiaries
or any of their respective properties or assets was or is required for the
execution, delivery or performance of the Deposit Agreement or the consummation
of the transactions contemplated thereby, including the deposit of ordinary
shares with the Depositary against the issuance by the Depositary of
certificates for ADSs representing such ordinary shares, except the registration
under the Act of the ADSs and the ordinary shares represented by the ADSs and
such consents, approvals, authorizations, orders, registrations, filings,
qualifications, licenses and permits as may be required under state securities
or Blue Sky laws or foreign equivalents of such regulations or statutes, where
applicable.
(m) The Company has been duly incorporated and is validly existing as a
public limited company under the laws of England and Wales. Each of the
subsidiaries of the Company has been duly organized and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation. Each of the Company and its subsidiaries is duly qualified to
transact business and is in good standing as a foreign corporation in each
jurisdiction in which the character and location of its properties (owned,
leased or licensed) or nature or conduct of its business makes such
qualification necessary, except where the failure to so qualify would not have a
Material Adverse Effect. Each of the Company and its subsidiaries has all
requisite power and authority and all necessary consents, approvals,
authorizations, orders, registrations, qualifications, licenses and permits
(collectively, "Governmental Licenses") of and from all public, regulatory or
governmental agencies and bodies to own, lease and operate its respective
properties and conduct its business as now being conducted and as described in
the Registration Statement and the Prospectus, and each such Governmental
License is valid and in full force and effect, except where the failure to have
such Governmental License, valid and in full force and effect, would not have a
Material Adverse Effect.
(n) Neither the Company nor any of its subsidiaries is in violation of any
provision of its memorandum and articles of association or by-laws or equivalent
constitutive documents or in breach of, or in default under (nor has any event
occurred that with notice, lapse of time, or both, would constitute a breach of,
or default under), except where such breach or default would not have a Material
Adverse Effect, any provision of any agreement, instrument, franchise, lease,
license or permit to which the Company or any of its subsidiaries is a party or
by which any of their respective properties or assets may be bound or affected
or any judgment, decree, order, statute, rule or regulation of any court or any
public, governmental or regulatory agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their respective properties or
assets.
(o) Except as described in the Registration Statement and the Prospectus,
there is no litigation, arbitration, proceeding, investigation or claim to which
the Company or any of its subsidiaries is a party or to which any property or
assets of the Company or any of its subsidiaries are subject which is pending
or, to the knowledge of the Company, threatened or contemplated against the
Company or any of its subsidiaries which might result in any Material
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Adverse Effect or any development involving a Material Adverse Effect or which
is required to be disclosed in the Registration Statement and the Prospectus.
(p) Neither the Company nor any of its directors, officers or affiliates
(as defined in the Regulations) has taken or will take, directly or indirectly,
any action designed to cause or result in, or which constitutes or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
ADSs or a violation of Regulation M under the Exchange Act.
(q) The consolidated financial statements, including the notes thereto, and
supporting schedules, if any, of the Company included in the Registration
Statement and the Prospectus present fairly the consolidated financial position
of the Company and its subsidiaries as of the dates indicated and the results of
their operations and their consolidated cash flows for the periods specified;
said financial statements have been prepared in conformity with U.S. generally
accepted accounting principles applied on a consistent basis; the supporting
schedules, if any, included in the Registration Statement or the Prospectus
present fairly the information required to be stated therein; and the selected
financial data and the summary financial information of the Company included in
the Registration Statement and the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that of the
financial statements of the Company included in the Registration Statement and
the Prospectus. No other financial statements are required by Form S-3 or
otherwise to be included in the Registration Statement or the Prospectus other
than those included therein.
(r) Except as described in the Registration Statement and the Prospectus
and except for rights that have been effectively waived in writing (complete and
accurate copies of which have been provided to the Underwriter prior to the date
of this Agreement), which waivers are in full force and effect, no holder of
securities of the Company has any rights to cause the Company to issue to it, or
register pursuant to the Act, any securities of the Company because of the
filing of the Registration Statement or otherwise in connection with the sale of
the ADSs contemplated hereby or otherwise. No holder of securities of the
Company has any preemptive or similar rights or other rights to purchase any of
the ADSs or the ordinary shares underlying the ADSs.
(s) The Company is not, and upon consummation of the transactions
contemplated hereby will not be, an "investment company" or a person
"controlled" by an "investment company" under the Investment Company Act of
1940.
(t) The ADSs of the Company, including the ADSs representing the Registered
Shares, are quoted on the National Association of Securities Dealers Automated
Quotation National Market System.
(u) The Company, directly or though one or more of its subsidiaries, owns
or possesses valid and enforceable licenses or other rights to use all
inventions, patents, patent applications, trademarks, service marks, trade
names, copyrights, technology, software, databases, Internet domain names,
know-how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures), proprietary
techniques (including processes and substances) and other intellectual property
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rights used in, or necessary to conduct, the business now conducted or presently
contemplated to be conducted by the Company and its subsidiaries, as described
in the Registration Statement and the Prospectus (collectively, "Intellectual
Property") free and clear of all liens, claims and encumbrances, except where
the failure to own or possess such rights would not reasonably be expected to
have a Material Adverse Effect; other than as described in the Registration
Statement and the Prospectus or which would not have a Material Adverse Effect:
(i) there are no third parties who have any rights in the Intellectual Property
that could preclude the Company or any of its subsidiaries from conducting their
respective businesses as currently conducted or as presently contemplated to be
conducted as described in the Registration Statement and the Prospectus; (ii)
there are no pending or, to the knowledge of the Company, threatened actions,
suits, proceedings, investigations or claims by others challenging the rights of
the Company or any of its subsidiaries or (if the Intellectual Property is
licensed) the licensor thereof in any Intellectual Property owned by or licensed
to the Company or any of its subsidiaries; (iii) neither the Company or any of
its subsidiaries nor (if the Intellectual Property is licensed) the licensor
thereof has infringed, or received any notice of infringement of or conflict
with, any rights of others with respect to the Intellectual Property; and (iv)
there is no dispute between the Company or any of its subsidiaries and any
licensor with respect to any Intellectual Property. The Company and its
subsidiaries have taken all reasonable steps to protect, maintain and safeguard
the Intellectual Property for which improper or unauthorized disclosure would
impair its value or validity and have entered into appropriate nondisclosure and
confidentiality agreements and made appropriate filings and registrations in
connection with the foregoing.
(v) The Company and its subsidiaries have timely filed all federal, state,
local and United Kingdom and other non-U.S. income and franchise tax returns and
reports required to be filed and have paid all taxes shown thereon and all
assessments received by them to the extent that such taxes have become due and
are not being contested in good faith, and there is no tax deficiency that has
been or, to the Company's knowledge, might be asserted or threatened against the
Company or any of its subsidiaries that might have a Material Adverse Effect;
and all tax liabilities are adequately provided for on the books of the Company.
(w) The Company and its subsidiaries maintain insurance with insurers of
recognized financial responsibility of the types and in the amounts (i)
generally deemed adequate for their businesses and consistent with insurance
coverage maintained by similar companies in similar businesses and (ii) required
under any of the Company's or any of its subsidiaries' agreements, licenses or
other contracts, all of which insurance is in full force and effect; the Company
has no reason to believe that it or any of its subsidiaries will not be able to
renew its existing insurance as and when such coverage expires or to obtain
similar insurance with similar insurers at a cost that would not have a Material
Adverse Effect.
(x) Each of the Company and its subsidiaries is in compliance with all
applicable federal, state, local or United Kingdom and other non-U.S. laws,
regulations, rules, ordinances, orders or directives relating to pollution or
(in connection therewith) protection of human health and safety, the environment
(including, without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without limitation, laws
and regulations relating to the release or threatened release of chemicals,
pollutants,
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contaminants, wastes, toxic substances, hazardous substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials (collectively, "Environmental Laws"), except
where failure to comply would not have a Material Adverse Effect; to the
Company's knowledge, no material expenditures are or will be required to comply
with the Environmental Laws; each of the Company and its subsidiaries holds all
permits, licenses and approvals required to conduct its business thereunder and
is in compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance or failure to comply with the terms
and conditions of, or failure to receive, such permits, licenses or approvals
will not singly or in the aggregate have a Material Adverse Effect.
(y) Except as disclosed in the Registration Statement and the Prospectus,
and except as set forth in the Credit Agreement, each of the Company and its
subsidiaries has good and marketable title to all properties (real and personal)
owned by the Company or any of its subsidiaries, free and clear of all
mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind except such as do not, singly or in the aggregate,
materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company or any
of its subsidiaries; and all properties held under lease or license by the
Company or any of its subsidiaries are held under valid, existing and
enforceable leases or licenses.
(z) Each of the Company and its subsidiaries maintains a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general and specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
the respective assets of the Company and each such subsidiary, as the case may
be, is permitted only in accordance with management's general or specific
authorizations, and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(aa) No labor dispute with the employees of the Company or any of its
subsidiaries is pending or, to the Company's knowledge, is imminent; and the
Company is not aware of any existing threatened or imminent labor disturbance by
the employees of any of its or any of its subsidiaries, principal suppliers,
collaborative or strategic partners, manufacturers or contractors that could
result in any Material Adverse Effect.
(bb) Neither the Company nor any subsidiary has any agreement, arrangement
or understanding for a fee, commission or other compensation on account of the
employment of a broker or finder in connection with the transactions
contemplated by this Agreement.
(cc) Under the laws of England and Wales, the irrevocable submission by the
Company to the jurisdiction of the United States federal or state court sitting
in the State of New York and the designation of the laws of the State of New
York to apply to this Agreement will be binding upon the Company, and, if
properly brought to the attention of the court or administrative body in
accordance with the laws of the United Kingdom, a judgment by such
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court would be enforceable in any judicial or administrative proceeding in the
United Kingdom (subject to any applicable exceptions to the recognition or
enforcement of foreign judgments in the United Kingdom). The Company has validly
and irrevocably waived, to the fullest extent permitted by law, the defense of
an inconvenient forum to the maintenance in any such court of any action or
proceeding arising out of or relating to this Agreement or any other document
delivered hereunder. The Company has validly appointed William A. Nuerge as its
authorized agent for service of process pursuant to this Agreement and the
Company has the legal capacity to sue and to be sued in its own name.
(dd) No stamp, transfer or other taxes or duties are payable to the United
Kingdom or any political subdivision or taxing authority thereof or therein in
connection with the transactions contemplated by this Agreement.
(ee) Based upon the nature of the Company's business and the ownership of
the Company and taking into account the transactions contemplated hereby, the
Company does not qualify as a passive foreign investment company as defined in
Section 1296(a) of the Code ("PFIC") or as a "foreign personal holding company"
as defined in Section 552 of the Code ("FPHC") or expect to so qualify for
future taxable years.
2. Representations, Warranties and Agreements of the Selling Shareholder.
The Selling Shareholder represents and warrants to, and agrees with, the
Underwriter that:
(a) The Selling Shareholder has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Delaware. The
Selling Shareholder has full right, power and authority to enter into this
Agreement and to sell, assign, transfer and deliver the ADSs to be sold by the
Selling Shareholder hereunder. This Agreement and the transactions contemplated
herein have been duly and validly authorized by all necessary corporate action
on the part of the Selling Shareholder, and this Agreement has been duly and
validly executed and delivered by the Selling Shareholder and is enforceable
against the Selling Shareholder in accordance with its terms, except as
enforcement (i) may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights and
remedies generally and (ii) is subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or law).
(b) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby do not and will not (i)
conflict with or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or both,
would constitute a default) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Selling
Shareholder pursuant to, any contract, agreement, instrument, understanding,
franchise, license or permit to which the Selling Shareholder is a party or by
which it or any of its properties or assets may be bound or (ii) violate or
conflict with any provision of the constitutive documents of the Selling
Shareholder or any judgment, decree, order, statute, rule or regulation of any
court or any public,
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governmental or regulatory agency or body having jurisdiction over the Selling
Shareholder or any of its properties or assets. No consent, approval,
authorization, order, registration, filing, qualification, license or permit of
or with any court or any public, governmental or regulatory agency or body
having jurisdiction over the Selling Shareholder or any of its properties or
assets is required for the execution, delivery or performance of this Agreement
or the consummation of the transactions contemplated hereby, including the sale
and delivery of the ADSs, except the registration under the Act of the
Registered Shares and such consents, approvals, authorizations, orders,
registrations, filings, qualifications, licenses and permits as may be required
under state securities or Blue Sky laws or foreign equivalents of such
regulations or statutes, where applicable, in connection with the purchase and
distribution of the ADSs by the Underwriter.
(c) The Selling Shareholder is the lawful owner of the ADSs and has, and on
the Closing Date will have, good and clear title to the ADSs, free and clear of
all liens, encumbrances, equities or claims, and upon sale and delivery of the
ADSs and payment therefor pursuant hereto, the Underwriter will have good and
clear title to the ADSs, free and clear of all liens, encumbrances, equities or
claims.
(d) Neither the Selling Shareholder nor any of its directors, officers or
affiliates has taken or will take, directly or indirectly, any action designed
to cause or result in, or which constitutes or which might reasonably be
expected to constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the ADSs or a
violation of Regulation M under the Exchange Act.
(e) The Selling Shareholder does not have any agreement, arrangement or
understanding for a fee, commission or other compensation on account of the
employment of a broker or finder in connection with the transactions
contemplated by this Agreement.
(f) At the time of the effectiveness of the Registration Statement or any
Rule 462(b) Registration Statement or the effectiveness of any post-effective
amendment to the Registration Statement, when the Prospectus is first filed with
the Commission pursuant to Rule 424(b) or Rule 434 of the Regulations, when any
supplement to or amendment of the Prospectus is filed with the Commission and at
the Closing Date, the Registration Statement and the Prospectus and any
amendments thereof and supplements thereto complied or will comply in all
material respects with the applicable provisions of the Act and the Regulations
and does not or will not contain an untrue statement of a material fact and does
not or will not omit to state any material fact required to be stated therein or
necessary in order to make the statements therein (i) in the case of the
Registration Statement, not misleading and (ii) in the case of the Prospectus,
in light of the circumstances under which they were made, not misleading. When
any related preliminary prospectus was first filed with the Commission (whether
filed as part of the registration statement for the registration of the
Registered Shares or any amendment thereto or pursuant to Rule 424(a) of the
Regulations) and when any amendment thereof or supplement thereto was first
filed with the Commission, such preliminary prospectus and any amendments
thereof and supplements thereto complied in all material respects with the
applicable provisions of the Act and the Regulations and did not contain an
untrue statement of a material fact and did not omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The representations and warranties made in this subsection (f),
however, shall relate only to information contained in the Registration
Statement or the Prospectus or any related preliminary
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prospectus or any amendment thereof or supplement thereto in reliance upon and
in conformity with information furnished in writing to the Company by the
Selling Shareholder for use in connection with the preparation thereof. (g)
During the period commencing on the date hereof and ending 60 days after the
date of the Prospectus, the Selling Shareholder agrees not to, directly or
indirectly, without the prior written consent of Bear, Stearns & Co. Inc. as the
Underwriter, (1) sell, offer or agree to sell, grant any option, warrant or
other right to purchase or otherwise sell or dispose of (or announce any offer
of sale, contract of sale, sale, grant of any option, warrant or other right to
purchase or other sale or disposition of), pledge, make any short sale or
maintain any short position, establish or maintain a "put equivalent position"
(within the meaning of Rule 16a-1(h) under the Exchange Act), enter into any
swap, derivative transaction or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of ordinary
shares (whether any such transaction is to be settled by delivery of ordinary
shares, ADSs representing ordinary shares, other securities, cash or other
consideration) or otherwise dispose of any ordinary shares (or any securities
convertible into, exercisable for or exchangeable for ordinary shares) or
interest therein of the Company or (2) except pursuant to this Agreement, make
any demand for, or exercise its rights, if any, to require the Company to
register its ordinary shares and to receive notice thereof.
(h) The Selling Shareholder will deliver to you prior to or at the Closing
Date a properly completed and executed United States Treasury Department Form
W-9 (or other applicable form or statement specified by Treasury Department
regulations in lieu thereof).
3. Purchase, Sale and Delivery of the ADSs.
(a) On the basis of the representations, warranties, covenants and
agreements herein contained, but subject to the terms and conditions herein set
forth, the Selling Shareholder agrees to sell the ADSs to the Underwriter and
the Underwriter agrees to purchase the ADSs from the Selling Shareholder, at a
purchase price per ADS of $48.375.
(b) Payment of the purchase price for, and delivery of certificates for,
the ADSs shall be made at the offices of Coudert Brothers, 1114 Avenue of the
Americas, New York, New York, 10036, or at such other place as shall be agreed
upon by you and the Selling Shareholder, at 10 A.M. on September 29, 2000, or
such other time as shall be agreed upon by you and the Selling Shareholder (such
time and date of payment and delivery being herein called the "Closing Date").
Payment shall be made to the Selling Shareholder by wire transfer of immediately
available funds to a bank account designated by the Selling Shareholder not less
than two business days prior to the Closing Date, against delivery by the
Selling Shareholder to you of the ADSs, duly indorsed for transfer with
indorsement guaranteed, and with such other documentation as shall be required
by the Depositary in connection with the transfer of the ADSs to you.
(c) The Selling Shareholder agrees that it shall not, for a period of 60
days following the Closing Date, declare or pay any dividends on, or make any
distribution however characterized in respect of, shares of its capital stock;
that it shall not, during such 60-day period,
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repay any indebtedness to any affiliate (as defined in the Act); that the
proceeds of the sale of the ADSs shall remain within the United States during
such 60-day period, and shall be used during such 60-day period (except for the
payment of United States or state taxes due and payable in respect of the sale
of the ADSs) solely in connection with the ordinary course of the Selling
Shareholder's U.S. business consistent with past practice.
4. Offering. Upon your authorization of the release of the ADSs, the
Underwriter proposes to offer the ADSs for sale to the public as set forth in
the Prospectus under the caption "Underwriting".
5. Covenants of the Company. The Company covenants and agrees with the
Underwriter that:
(a) The Company will file the Prospectus (properly completed if Rule 430A
has been used) pursuant to Rule 424(b) within the prescribed time period and
will provide evidence satisfactory to you of such timely filing.
The Company will notify you immediately (and, if requested by you, will
confirm such notice in writing) (i) when any amendments to the Registration
Statement become effective, (ii) of any request by the Commission for any
amendment of or supplement to the Registration Statement or the Prospectus or
for any additional information, (iii) of the mailing or the delivery to the
Commission for filing of any amendment of or supplement to the Registration
Statement or the Prospectus, (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or of the initiation, or the threatening, of
any proceedings therefor and (v) of the receipt of any comments from the
Commission. If the Commission shall propose or enter a stop order at any time,
the Company will make every reasonable effort to prevent the issuance of any
such stop order and, if issued, to obtain the lifting of such order as soon as
possible. The Company will not file any amendment to the Registration Statement,
make any filing under Rule 462(b) of the Regulations or file any amendment of or
supplement to the Prospectus (including the prospectus required to be filed
pursuant to Rule 424(b)) that differs from the prospectus on file on the date
hereof to which you shall reasonably object in writing after being timely
furnished in advance a copy thereof.
(b) The Company will comply with the Act and the Regulations so as to
permit the completion of the distribution of the ADSs as contemplated in this
Agreement and the Prospectus. If, at any time when a prospectus relating to the
Registered Shares and the ADSs is required to be delivered under the Act, any
event shall have occurred as a result of which the Prospectus as then amended or
supplemented would, in the judgment of the Underwriter or the Company, include
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading, or if
it shall be necessary at any time to amend or supplement the Prospectus or
Registration Statement to comply with the Act or the Regulations, or to file
under the Exchange Act, so as to comply therewith, any document incorporated by
reference in the Registration Statement or the Prospectus or in any amendment
thereof or supplement thereto, the Company will notify you promptly and prepare
and file with
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the Commission an appropriate amendment or supplement (in form and substance
reasonably satisfactory to you) which will correct such statement or omission or
which will effect such compliance and will use its best efforts to have any
amendment to the Registration Statement declared effective as soon as possible.
(c) The Company will promptly deliver to you one signed copy of the
Registration Statement and all amendments thereto (including exhibits), and of
all documents incorporated by reference in the Registration Statement and
Prospectus or any amendment or supplement thereto, and will maintain in the
Company's files manually signed copies of such documents for at least five years
from the date of filing. The Company will promptly deliver to the Underwriter
such number of copies of any preliminary prospectus, the Prospectus, the
Registration Statement, and all amendments of and supplements to such documents,
if any, and all documents incorporated by reference in the Registration
Statement and Prospectus or any amendment or supplement thereto as you may
reasonably request, and the Company hereby consents to the use of such copies
for purposes permitted by the Act.
(d) The Company will endeavor in good faith, in cooperation with you,
promptly from time to time, to qualify the Registered Shares and ADSs for
offering and sale under the securities laws of such jurisdictions in the United
States as you may designate and to maintain such qualification in effect for so
long as required for the distribution thereof; except that in no event shall the
Company be obligated in connection therewith to qualify as a foreign corporation
or to execute a general consent to service of process. The Company will promptly
advise you of the receipt by the Company of any notification with respect to
suspension of the qualification of the Registered Shares or ADSs for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose
and will use every reasonable effort to obtain the withdrawal of any order of
suspension as soon as possible.
(e) The Company will make generally available (within the meaning of
Section 11(a) of the Act) to its security holders and to you as soon as
practicable, but not later than 45 days after the end of its fiscal quarter in
which the first anniversary date of the effective date of the Registration
Statement occurs, an earnings statement (in form complying with the provisions
of Rule 158 of the Regulations) covering a period of at least twelve consecutive
months beginning after the effective date of the Registration Statement.
(f) During the period of 60 days from the date of the Prospectus, (i) the
Company will not, without the prior written consent of Bear, Stearns & Co. Inc.
as the Underwriter, directly or indirectly, issue, sell, offer or agree to sell,
grant any option, warrant or other right to purchase or otherwise sell or
dispose of (or, unless required by applicable law or the rules or regulations of
the London Stock Exchange or Nasdaq, announce any offer of sale, contract of
sale, sale, grant of any option, warrant or other right to purchase or other
sale or disposition of), pledge, make any short sale or maintain any short
position, establish or maintain a "put equivalent position" (within the meaning
of Rule 16a-1(h) under the Exchange Act), enter into any swap, derivative
transaction or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership of ADSs or ordinary shares
(whether any such transaction is to be settled by delivery of ordinary shares,
ADSs representing ordinary shares, other securities, cash or other
consideration) or otherwise dispose of, any ADSs or
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ordinary shares (or any securities convertible into, exercisable for or
exchangeable for ADSs or ordinary shares) or interest therein of the Company,
except for (A) the issuance by the Company of ordinary shares pursuant to the
exercise of options outstanding under the Company's employee benefit plans on
the date hereof and disclosed in the Registration Statement and the Prospectus
and (B) the issuance of ordinary shares pursuant to the conversion of the loan
note held by Arenol Corporation having a principal amount of $2,800,000 and (ii)
the Company will not permit any of the officers and directors of the Company, as
of the time of the closing of the sale of the ADSs hereunder on the Closing
Date, to engage in any of the aforementioned transactions on their own behalf,
provided, however, that Mr. John Spitznagel shall be permitted to sell up to an
aggregate of 255,490 ordinary shares (or ADSs representing such number of
ordinary shares) during the two-day period from September 28, 2000 to September
29, 2000.
(g) During a period of three years from the date of the Prospectus, the
Company will furnish to you (i) copies of any reports or other communications
that the Company shall send to its stockholders or shall from time to time
publish or publicly disseminate and (ii) copies of all reports, financial
statements and proxy or information statements filed by the Company with the
Commission or any national securities exchange or automated quotation system.
(h) The Company, during the period when the Prospectus is required to be
delivered under the Act or the Exchange Act, will file all documents required to
be filed with the Commission pursuant to Section 13, 14 or 15 of the Exchange
Act within the time periods required by the Exchange Act and the rules and
regulations thereunder.
(i) The Company will use its commercially reasonable best efforts to
satisfy all conditions precedent to the transactions contemplated by this
Agreement.
6. Payment of Expenses. Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated, the Company
hereby agrees to pay all costs and expenses incident to the performance of the
obligations of the Company hereunder, including those in connection with (i)
preparing, printing, duplicating, filing and distributing the Registration
Statement, as originally filed, and all amendments thereof (including all
exhibits thereto), the Prospectus and any amendments or supplements thereto
(including, without limitation, fees and expenses of the Company's accountants
and counsel), this Agreement and all other documents related to the transactions
contemplated hereby, (ii) the qualification of the Registered Shares or ADSs
under state or foreign securities or Blue Sky laws or regulations, including the
costs of printing and mailing a preliminary and final "Blue Sky Survey" and the
fees of counsel for the Underwriter and such counsel's disbursements in relation
thereto, (iii) quotation of the ADSs on the National Association of Securities
Dealers Automated Quotation National Market System, (iv) filing fees of the
Commission, (v) the fees and charges of the Depositary, and (vi) the cost and
charges of the agent for service of the Company. Notwithstanding the foregoing,
the Selling Shareholder shall reimburse the Company for the Company's
out-of-pocket expenses to its counsel and its accountants and to the Depositary
incurred in connection with the transactions contemplated hereby, up to a
maximum total amount of US$100,000. The Selling Shareholder will pay or cause to
be paid (I) all costs and expenses incident to the Selling Shareholder's
performance of its obligations hereunder which are not
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otherwise specifically provided for in this Section, including (i) any fees and
expenses of counsel of the Selling Shareholder, (ii) all expenses, taxes and
duties incident in the sale and delivery of the ADSs to be sold hereunder and
(iii) the costs and charges of the agent for service of the Selling Shareholder
and (II) all filing fees of the National Association of Securities Dealers, Inc.
with respect to the transactions contemplated hereby.
7. Conditions of Underwriter's Obligations. The obligations of the
Underwriter to purchase and pay for the ADSs, as provided herein, shall be
subject to the accuracy of the representations and warranties of the Company and
the Selling Shareholder herein contained, as of the date hereof and as of the
Closing Date, to the absence from any certificates, opinions, written statements
or letters furnished to you or to Coudert Brothers ("Underwriter's Counsel")
pursuant to this Section 7, of any misstatement or omission, to the performance
by the Company and the Selling Shareholder of their respective obligations
hereunder, and to the following additional conditions:
(a) The Prospectus shall have been filed with the Commission in a timely
fashion in accordance with Section 5(a) hereof; and, at or prior to the Closing
Date, no stop order suspending the effectiveness of the Registration Statement
or any post-effective amendment thereof shall have been issued and no
proceedings therefor shall have been initiated or threatened by the Commission.
(b) At the Closing Date you shall have received the opinion of Slaughter
and May, U.K., counsel for the Company, dated the Closing Date, addressed to the
Underwriter and in form and substance satisfactory to Underwriter's Counsel, to
the effect that:
(i) The Company has been duly incorporated and is validly existing as
a public limited company under the laws of England and Wales.
(ii) The Company has the requisite corporate power and authority to
execute, deliver and perform this Agreement and the Deposit Agreement, and
to consummate the transactions contemplated hereby and thereby.
(iii) This Agreement has been duly and validly authorized, executed
and delivered by the Company and, assuming that this Agreement creates
valid and binding obligations of the parties under New York law, is
enforceable against the Company in accordance with its terms, except as
enforcement (i) may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the enforcement
of creditors' rights generally and (ii) is subject to general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or law).
(iv) The Deposit Agreement and the transactions contemplated therein
have been duly and validly authorized by the Company; the Deposit Agreement
has been duly and validly executed and delivered by the Company and,
assuming the Deposit Agreement creates valid and binding obligations of the
parties under New York law, is enforceable against the Company in
accordance with its terms, except as enforcement (i) may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
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laws relating to or affecting the enforcement of creditors' rights
generally and (ii) is subject to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
law).
(v) The execution, delivery and performance of this Agreement by the
Company and the consummation by the Company of the transactions
contemplated hereby did not and will not violate or conflict with any
provision of the memorandum and articles of association or by-laws or
equivalent constitutive documents of the Company or law or regulation of
England and Wales. No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any
public, governmental, or regulatory agency or body having jurisdiction over
the Company or any of its properties or assets is required for the
execution, delivery and performance of this Agreement or the consummation
of the transactions contemplated hereby, including the sale and delivery of
the ADSs.
(vi) The execution, delivery and performance of the Deposit Agreement
and the consummation of the transactions contemplated thereby did not and
will not violate or conflict with any provision of the memorandum and
articles of association or by-laws or equivalent constitutive documents of
the Company or any law or regulation of England and Wales. No consent,
approval, authorization, order, registration, filing, qualification,
license or permit of or with any public, governmental or regulatory agency
or body having jurisdiction over the Company or any of its properties or
assets was or is required for the execution, delivery or performance of the
Deposit Agreement or the consummation of the transactions contemplated
thereby, including the deposit with the Depositary of ordinary shares
against the issuance by the Depositary of certificates for ADSs
representing such ordinary shares.
(vii) The statements in the Registration Statement and the Prospectus
under the caption "Description of Share Capital", insofar as such
statements relate to matters of the laws of England and Wales or
regulations are true and accurate in all material respects, and nothing has
been omitted from such statements which would make them misleading in any
material respect.
(viii) Under the laws of England and Wales, the irrevocable submission
by the Company to the jurisdiction of the United States federal or state
courts sitting in the State of New York and the designation of the laws of
the State of New York to apply to this Agreement will be binding upon the
Company, and, if properly brought to the attention of the court or
administrative body in accordance with the laws of the United Kingdom, a
judgment by such court would be enforceable in any judicial or
administrative proceeding in England and Wales (subject to any applicable
exceptions to the recognition or enforcement of foreign judgments in
England and Wales as specifically noted by such counsel). The Company has
validly and irrevocably waived, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance in any such court of
any action or proceeding arising out of or relating to this Agreement or
any other document delivered hereunder. The Company has validly and
irrevocably appointed William A. Nuerge as its authorized agent for service
of process pursuant to
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this Agreement and the Company has the legal capacity to sue and to be sued
in its own name.
(ix) A final and conclusive judgment for a definite sum of money
entered by a state or federal court in the United States of America in any
action, suit or proceeding arising out of or in connection with the
obligations of the Company under the Agreement would be recognized for the
purpose of enforcement proceedings, without re-examination or re-litigation
of the matters adjudicated upon, by an English court (although this would
be a matter within such court's discretion), provided that:
(a) the judgment was not obtained by fraud;
(b) the enforcement of the judgment would not be contrary to
English public policy;
(c) the judgment was not given in a manner contrary to the
principles of natural justice (as applied by English courts);
(d) the judgment was not inconsistent with an English judgment in
respect of the same matter or, in some circumstances, with an earlier
foreign judgment which satisfied the same criteria and was enforceable
in England;
(e) the judgment was not for multiple damages (as defined by the
Protection of Trading Interests Act 1980);
(f) the proceedings before the court of the United States of
America were not of a penal or revenue nature; and
(g) the enforcement proceedings were instituted within six years
after the date of the judgment.
(x) It is not necessary that, prior to seeking enforcement of this
Agreement or the Deposit Agreement in England and Wales, this Agreement,
the Deposit Agreement or any other document be filed or recorded with any
court or other authority in England and Wales or that any British stamp or
similar tax be paid.
(xi) None of the Company or any of its properties or assets has any
immunity from jurisdiction of any competent court or from any legal process
(whether through service or notice, attachment prior to judgment,
attachment in aid of judgment or otherwise) under the laws of England and
Wales.
(xii) No stamp, transfer or other taxes or duties are payable to the
United Kingdom or any political subdivision or taxing authority thereof or
therein in connection with the transactions contemplated by this Agreement.
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In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of England and Wales and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to Underwriter's
Counsel) of other counsel, reasonably acceptable to Underwriter's Counsel,
familiar with the applicable laws; and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Company and
certificates or other written statements of officers of departments of various
jurisdictions having custody of documents respecting the corporate existence or
good standing of the Company and its subsidiaries, provided that copies of any
such statements or certificates shall be delivered to Underwriter's Counsel. The
opinion of such counsel for the Company shall state that the opinion of any such
other counsel is in form satisfactory to such counsel and, in their opinion, you
and they are justified in relying thereon.
(c) At the Closing Date you shall have received the opinion of Neil Harris,
Head of Legal Affairs of the Company, dated the Closing Date, addressed to the
Underwriter and in form and substance satisfactory to Underwriter's Counsel, to
the effect that:
(i) The Company has been duly incorporated and is validly existing as
a public limited company under the laws of England and Wales. Each of the
Company and its subsidiaries has all requisite corporate authority to own,
lease and license its respective properties and conduct its business as now
being conducted and as described in the Registration Statement and the
Prospectus, except where the absence of such authority would not have a
Material Adverse Effect. All the issued and outstanding capital stock of
each subsidiary of the Company has been duly and validly issued and is
fully paid and nonassessable, was not issued in violation of preemptive or
similar rights (unless such rights have been duly waived by the holders of
such rights) and is owned directly or indirectly by the Company, free and
clear (other than (i) as set forth in that certain Amended and Restated
Credit Agreement among the Company, its subsidiaries, certain financial
institutions and DLJ Capital Fund Inc. as administrative agent dated
November 19, 1999 and (ii) directors' qualifying shares) of any lien,
encumbrance, claim, security interest, restriction on transfer,
shareholders' agreement, voting trust or other defect of title whatsoever.
(ii) The Company had, at June 30, 2000, an authorized and outstanding
capitalization as set forth in the Registration Statement and the
Prospectus. All of the outstanding shares of capital stock of the Company,
including the Registered Shares, are duly and validly authorized, allotted
and issued as fully paid, and none of such shares were issued in violation
of or subject to any preemptive or similar rights. To the best of such
counsel's knowledge, except as disclosed in the Registration Statement and
Prospectus or in Schedule III hereto, there are no outstanding options,
warrants or other rights calling for the issuance of, and no commitments,
obligations, plans or arrangements to issue, any shares of capital stock of
the Company or any security convertible into or exchangeable for capital
stock of the Company.
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(iii) The Company has validly deposited the Registered Shares with the
Depositary against the issuance, by the Depositary, of certificates for
ADSs representing the Registered Shares in accordance with the Deposit
Agreement.
(iv) To the best of such counsel's knowledge, there is no litigation,
arbitration, proceeding, investigation or claim to which the Company or any
of its subsidiaries is a party or to which any property or assets of the
Company or any of its subsidiaries are subject which is pending or
threatened against the Company or any of its subsidiaries and which is of a
character required to be disclosed in the Registration Statement and the
Prospectus which has not been properly disclosed therein or any statute or
regulation that is required to be described in the Registration Statement
and the Prospectus which has not been described therein as required.
(v) The execution, delivery and performance of this Agreement by the
Company and the consummation by the Company of the transactions
contemplated hereby did not and will not (A) conflict with or result in a
breach of any of the terms and provisions of, or constitute a default (or
an event which with notice or lapse of time, or both, would constitute a
default) under, or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any contract, agreement, instrument,
understanding, franchise, lease, license or permit known to such counsel to
which the Company or any of its subsidiaries is a party or by which any of
such companies or their respective properties or assets may be bound or (B)
violate or conflict with, to the best of such counsel's knowledge, any
judgment, decree or order, or any statute, rule or regulation of any court
or any public, governmental or regulatory agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
respective properties or assets.
(vi) The execution, delivery and performance of the Deposit Agreement
and the consummation of the transactions contemplated thereby did not and
will not (i) conflict with or result in a breach of any of the terms and
provisions of, or constitute a default (or an event which with notice or
lapse of time, or both, would constitute a default) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company or any of its subsidiaries pursuant to, any
contract, agreement, instrument, understanding, franchise, license or
permit known to such counsel to which the Company or any of its
subsidiaries is a party or by which any of such companies or any of their
respective properties or assets may be bound or (ii) violate or conflict
with, to such counsel's knowledge, any judgment, order or decree of any
court or any public, governmental or regulatory agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
respective properties or assets.
(vii) To the best of such counsel's knowledge, there are no contracts,
agreements, instruments, leases, licenses or other documents or items
required to be described or referred to in the Registration Statement and
the Prospectus or to be filed as exhibits to the Registration Statement
other than those described or referred to therein or filed as exhibits
thereto as required; and the descriptions thereof and the references
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thereto in the Registration Statement and Prospectus are accurate in all
material respects and provide a fair summary thereof.
In addition, such opinion shall also contain a statement that such counsel
has participated in conferences with certain officers and representatives of the
Company, the Underwriter and the Underwriter's counsel at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and no facts have come to the attention of such counsel which would lead such
counsel to believe that either the Registration Statement at the time it became
effective (including the information deemed to be part of the Registration
Statement at the time of effectiveness pursuant to Rule 430A(b) or Rule 434, if
applicable), or any amendment thereof made prior to the Closing Date as of the
date of such amendment, contained an untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus as of its
date (or any amendment thereof or supplement thereto made prior to the Closing
Date as of the date of such amendment or supplement) and as of the Closing Date
contained or contains an untrue statement of a material fact or omitted or omits
to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
belief or opinion with respect to the financial statements, including the notes
and schedules thereto and other financial data derived therefrom, or to
statistical data contained therein).
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of England and Wales and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to Underwriter's
Counsel) of other counsel, reasonably acceptable to Underwriter's Counsel,
familiar with the applicable laws; and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Company and
certificates or other written statements of officers of departments of various
jurisdictions having custody of documents respecting the corporate existence or
good standing of the Company and its subsidiaries, provided that copies of any
such statements or certificates shall be delivered to Underwriter's Counsel. The
opinion of such counsel for the Company shall state that the opinion of any such
other counsel is in form satisfactory to such counsel and, in their opinion, you
and they are justified in relying thereon.
(d) At the Closing Date you shall have received the opinion of Cahill
Gordon & Reindel, U.S. counsel for the Company, dated the Closing Date,
addressed to the Underwriter and in form and substance satisfactory to
Underwriter's Counsel, to the effect that:
(i) Assuming due authorization, execution and delivery by the Company
under the laws of England and Wales, this Agreement has been duly and
validly executed and delivered by the Company under the laws of the State
of New York.
(ii) Assuming due authorization, execution and delivery by the Company
under the laws of England and Wales, the Deposit Agreement has been duly
and validly executed and delivered by the Company under the laws of the
State of New York and, assuming due authorization, execution and delivery
by the Depositary, is enforceable
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against the Company in accordance with its terms, except as enforcement (i)
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the enforcement of creditors'
rights generally and (ii) is subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or law).
(iii) The execution, delivery and performance of this Agreement by the
Company and the consummation by the Company of the transactions
contemplated hereby did not and will not violate or conflict with, to the
best of such counsel's knowledge, any judgment, decree or order, or any
statute, rule or regulation of any court or any public, governmental or
regulatory agency or body having jurisdiction over the Company or any of
its properties or assets. No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any court
or any public, governmental, or regulatory agency or body having
jurisdiction over the Company or any of its properties or assets is
required for the execution, delivery and performance of this Agreement or
the Deposit Agreement or the consummation of the transactions contemplated
hereby or thereby, including the sale and delivery of the ADSs, except for
(1) such as may be required under state securities or Blue Sky laws or
regulations (or foreign securities laws or regulations, if applicable) in
connection with the purchase and distribution of the ADSs by the
Underwriter (as to which such counsel need express no opinion) and (2) such
as have been made or obtained under the Act.
(iv) The execution, delivery and performance of the Deposit Agreement
and the consummation of the transactions contemplated thereby did not and
will not violate or conflict with, to such counsel's knowledge, any
judgment, order or decree of any court or any public, governmental or
regulatory agency or body having jurisdiction over the Company or any of
its properties or assets. No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any court
or any public, governmental or regulatory agency or body having
jurisdiction over the Company or any of its properties or assets was or is
required for the execution, delivery or performance of the Deposit
Agreement or the consummation of the transactions contemplated thereby,
including the deposit with the Depositary of ordinary shares against the
issuance by the Depositary of certificates for ADSs representing such
ordinary shares.
(v) The Registration Statement and the Prospectus and any amendments
thereof or supplements thereto (other than the financial statements and
notes and schedules thereto and other financial data derived therefrom, as
to which no opinion need be rendered) comply as to form in all material
respects with the requirements of the Act and the Regulations. The reports
and other documents incorporated by reference in the Registration Statement
and the Prospectus, when they became effective or were filed with the
Commission, as the case may be, complied in all material respects to the
requirements of the Act and the Regulations.
(vi) The Company is not, and upon consummation of the transactions
contemplated hereby will not be, an "investment company" or a person
"controlled" by an
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"investment company" within the meaning of the Investment Company Act of
1940, as amended.
(vii) Under the laws of the State of New York the irrevocable
submission by the Company to the jurisdiction of the United States federal
or state courts sitting in the State of New York and the designation of the
laws of the State of New York to apply to this Agreement will be binding
upon the Company. The Company has validly and irrevocably waived, to the
fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance in any such court of any action or proceeding arising out
of or relating to this Agreement or any other document delivered hereunder.
The Company has validly and irrevocably appointed William A. Nuerge as its
authorized agent for service of process pursuant to this Agreement.
(viii) The Registered Shares have been registered under the Act.
(ix) The Registration Statement is effective under the Act, and, to
the best of such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement or any post-effective amendment
thereof has been issued and no proceedings therefor have been initiated or
threatened by the Commission. All filings required by Rule 424(a) and Rule
424(b) of the Regulations have been made.
(x) The ADS Registration Statement is effective under the Act, and, to
the best of such counsel's knowledge, no stop order suspending the
effectiveness of the ADS Registration Statement or any post-effective
amendment thereof has been issued and no proceedings therefor have been
initiated or threatened by the Commission.
(xi) The ADS Registration Statement when it became effective, and any
post-effectiveness amendments thereto, as of their respective effective
dates, conformed, in all material respects, with the requirements of the
Act.
In addition, such opinion shall also contain a statement that such counsel
has participated in conferences with certain officers and representatives of the
Company, the independent public accountants for the Company, the Underwriter and
the Underwriter's counsel at which the contents of the Registration Statement
and the Prospectus and related matters were discussed and no facts have come to
the attention of such counsel which would lead such counsel to believe that
either the Registration Statement at the time it became effective (including the
information deemed to be part of the Registration Statement at the time of
effectiveness pursuant to Rule 430A(b) or Rule 434, if applicable), or any
amendment thereof made prior to the Closing Date as of the date of such
amendment, contained an untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus as of its date (or any
amendment thereof or supplement thereto made prior to the Closing Date as of the
date of such amendment or supplement) and as of the Closing Date contained or
contains an untrue statement of a material fact or omitted or omits to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no belief or
opinion with respect
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to the financial statements, including the notes and schedules thereto and other
financial data derived therefrom, or to statistical data contained therein).
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to Underwriter's
Counsel) of other counsel, reasonably acceptable to Underwriter's Counsel,
familiar with the applicable laws; and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Company and
certificates or other written statements of officers of departments of various
jurisdictions having custody of documents respecting the corporate existence or
good standing of the Company and its subsidiaries, provided that copies of any
such statements or certificates shall be delivered to Underwriter's Counsel. The
opinion of such counsel for the Company shall state that the opinion of any such
other counsel is in form satisfactory to such counsel and, in their opinion, you
and they are justified in relying thereon.
(e) At the Closing Date, you shall have received the opinion of Howard,
Rice, Nemerovski, Canady, Falk & Rabkin, counsel for the Selling Shareholder,
dated the Closing Date, addressed to the Underwriter and in form and substance
satisfactory to the Underwriter's Counsel, to the effect that:
(i) The Selling Shareholder has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Delaware. The
Selling Shareholder has requisite power and authority to enter into this
Agreement and to sell, assign, transfer and deliver the ADSs to be sold by
the Selling Shareholder hereunder. This Agreement and the transactions
contemplated herein have been duly and validly authorized by all necessary
corporate action on the part of the Selling Shareholder, and this Agreement
has been duly and validly executed and delivered by the Selling Shareholder
and is enforceable against the Selling Shareholder in accordance with its
terms, except as enforcement (i) may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
creditors' rights and remedies generally and (ii) is subject to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or law).
(ii) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby by the Selling
Shareholder do not and will not (A) conflict with or result in a breach of
any of the terms and provisions of, or constitute a default (or an event
which with notice or lapse of time, or both, would constitute a default)
under, or result in the creation or imposition of any lien, charge or
encumbrance upon the ADSs pursuant to, any contract, agreement or other
instrument known to such counsel to which the Selling Shareholder is a
party or by which it or any of its properties or assets may be bound or (B)
contravene any provision of applicable law, violate or conflict with any
provision of the Certificate of Incorporation or By-laws of the Selling
Shareholder or, to the best of such counsel's knowledge, any judgment,
decree, order, statute, rule or regulation of any court or any public,
governmental or regulatory agency or body having jurisdiction over the
Selling Shareholder or the ADSs or the
24
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Registered Shares. No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any court
or any public, governmental or regulatory agency or body having
jurisdiction over the Selling Shareholder or the ADSs or the Registered
Shares is required for the execution, delivery or performance of this
Agreement or the consummation of the transactions contemplated hereby,
including the sale and delivery of the ADSs, except for (1) such as may be
required under state securities or Blue Sky laws or regulations (or foreign
securities laws or regulations, if applicable) in connection with the
purchase and distribution of the ADSs by the Underwriter (as to which such
counsel needs express no opinion) and (2) such as have been made or
obtained under the Act.
(iii) Upon payment for and delivery of the ADSs in accordance with the
terms of this Agreement, and assuming the Underwriter is acquiring the ADSs
without notice of any adverse claim, the Underwriter will be the owner of
the ADSs, free of any adverse claim.
In addition, such counsel shall confirm that (i) it received directly from
the Depositary, on behalf of the Selling Shareholder, the certificates
representing the ADSs, in exchange for delivery by the Selling Shareholder to
the Company of 5,048,500 shares of common stock of Roberts Pharmaceuticals held
by the Selling Shareholder prior to the merger of Roberts Pharmaceuticals and a
subsidiary of the Company on December 23, 1999, and it maintained possession of
such certificates representing the ADSs continually from such time until it
delivered such certificates together with executed stock powers (signature
guaranteed), on behalf of the Selling Shareholder, to the Depositary for
delivery to Bear Stearns pursuant to its instructions and (ii) it has no
knowledge of any adverse claim with respect to the ADSs. Such counsel may
indicate, in making the statement set forth in clause (ii) of the preceding
sentence, that it has not made any independent inquiry with respect to such
statement.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to Underwriter's
Counsel) of other counsel, reasonably acceptable to Underwriter's Counsel,
familiar with the applicable laws; and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Selling
Shareholder and certificates or other written statements of officers of
departments of various jurisdictions having custody of documents respecting the
corporate existence or good standing of the Selling Shareholder, provided that
copies of any such statements or certificates shall be delivered to
Underwriter's Counsel. The opinion of such counsel for the Selling Shareholder
shall state that the opinion of any such other counsel is in form satisfactory
to such counsel and, in their opinion, you and they are justified in relying
thereon.
(f) At the Closing Date, you shall have received the opinion of Ziegler,
Ziegler & Altman, counsel to the Depositary, dated the Closing Date, addressed
to the Underwriter and in the form and substance satisfactory to the
Underwriter's Counsel, to the effect that:
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(i) The Deposit Agreement has been duly and validly authorized,
executed and delivered by the Depositary and is enforceable against the
Depositary in accordance with its terms, except as enforcement (i) may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the enforcement of creditors' rights
generally and (ii) general principals of equity (regardless of whether such
enforceability is considered in a proceeding in equity or law).
(ii) The ADSs (when issued in accordance with the Deposit Agreement
against the deposit of ordinary shares of the Company) are duly and validly
issued in accordance with the terms of the Deposit Agreement and entitle
the holders thereof to the right to receive three ordinary shares of the
Company and to the other rights specified therein and in the Deposit
Agreement.
(g) All proceedings taken in connection with the sale of the ADSs as herein
contemplated shall be satisfactory in form and substance to you and to
Underwriter's Counsel, and the Underwriter shall have received from said
Underwriter's Counsel a favorable opinion, dated as of the Closing Date, with
respect to the sale of the ADSs, the Registration Statement and the Prospectus
and such other related matters as you may reasonably require, and the Company
and the Selling Shareholder shall have furnished to Underwriter's Counsel such
documents as they may reasonably request for the purpose of enabling them to
pass upon such matters.
(h) At the Closing Date, you shall have received a certificate of the Chief
Executive Officer and Chief Financial Officer of the Company, dated the Closing
Date, to the effect that (i) the condition set forth in subsection (a) of this
Section 7 has been satisfied, (ii) as of the date hereof and as of the Closing
Date the representations and warranties of the Company set forth in Section 1
hereof are true and correct, (iii) as of the Closing Date the obligations of the
Company to be performed hereunder on or prior thereto have been duly performed
and (iv) subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, the Company and its subsidiaries
have not sustained any loss or interference with their businesses or properties
from fire, flood, hurricane, accident or other calamity, whether or not covered
by insurance, or from any labor dispute or any legal or governmental proceeding,
and there has not been any Material Adverse Change or any development involving
a Material Adverse Effect, except in each case as described in or contemplated
by the Prospectus.
(i) At the Closing Date, you shall have received a certificate of the Chief
Executive Officer and Chief Financial Officer of the Selling Shareholder, dated
the Closing Date, to the effect that (i) as of the date hereof and as of the
Closing Date the representations and warranties of the Selling Shareholder set
forth in Section 2 hereof are true and correct and (ii) as of the Closing Date
the obligations of the Selling Shareholder to be performed hereunder on or prior
thereto have been duly performed. In addition, at the Closing Date you shall
have received a letter from Yamanouchi Pharmaceutical Co. Ltd. in the form
previously agreed with the Underwriter.
(j) At the time this Agreement is executed and at the Closing Date, you
shall have received a letter from Arthur Andersen, independent public
accountants for the Company,
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dated, respectively, as of the date of this Agreement and as of the Closing
Date, addressed to you and in form and substance satisfactory to you, stating
that: (i) they are independent certified public accountants with respect to the
Company within the meaning of the Act and the Regulations; (ii) in their
opinion, the financial statements and schedules of the Company included in the
Registration Statement and the Prospectus and covered by their opinion therein
comply as to form in all material respects with the applicable accounting
requirements of the Act and the applicable published rules and regulations of
the Commission thereunder; (iii) on the basis of procedures consisting of a
reading of the latest available unaudited interim financial statements of the
Company and of the latest available unaudited monthly financial statements of
the Company (which, in the case of the letter delivered on the Closing Date,
shall be at least as of August 31, 2000), a reading of the minutes of meetings
and consents of the stockholders and board of directors of the Company and the
committees of such board subsequent to December 31, 1999, inquiries of officers
and other employees of the Company who have responsibility for financial and
accounting matters of the Company with respect to transactions and events
subsequent to December 31, 1999 and other specified procedures and inquiries to
a date not more than five days prior to the date of such letter (provided that
the letter delivered on the Closing Date shall use a "cut-off" date not earlier
than the date hereof), nothing has come to their attention that would cause them
to believe that: (A) the unaudited financial statements and schedules of the
Company presented in the Registration Statement and the Prospectus do not comply
as to form in all material respects with the applicable accounting requirements
of the Act and the applicable published rules and regulations of the Commission
thereunder or that such unaudited financial statements are not in conformity
with generally accepted accounting principles applied on a basis substantially
consistent with that of the audited financial statements included in the
Registration Statement and the Prospectus; (B) with respect to the period
subsequent to June 30, 2000 there were, as of the date of the most recent
available monthly financial statements of the Company, if any, and as of a
specified date not more than five days prior to the date of such letter
(provided that the letter delivered on the Closing Date shall use a "cut-off"
date not earlier than the date hereof), any changes in the capital stock or
long-term liabilities of the Company or any decrease in the current assets or
shareholders' equity of the Company, in each case as compared with the amounts
shown in the most recent balance sheet of the Company presented in the
Registration Statement and the Prospectus, except for changes or decreases which
the Registration Statement and the Prospectus disclose have occurred or may
occur or which are set forth in such letter; or (C) that during the period from
July 1, 2000 to the date of the most recent available monthly financial
statements of the Company, if any, and to a specified date not more than five
days prior to the date of such letter (provided that the letter delivered on the
Closing Date shall use a "cut-off" date not earlier than the date hereof), there
was any decrease, as compared with the corresponding period in the prior fiscal
year, in revenues, or increase in net loss, except for decreases or increases,
as the case may be, which the Registration Statement and the Prospectus disclose
have occurred or may occur or which are set forth in such letter; and (iv)
stating that they have compared specific dollar amounts, numbers of shares,
percentages of revenues and earnings and other financial information pertaining
to the Company set forth in the Registration Statement and the Prospectus, which
have been specified by you prior to the date of this Agreement, to the extent
that such amounts, numbers, percentages and information may be derived from the
general accounting and financial records of the Company or from schedules
furnished by the Company, and excluding any questions requiring an
27
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interpretation by legal counsel, with the results obtained from the application
of specified readings, inquiries and other appropriate procedures specified by
you set forth in such letter, and found them to be in agreement.
(k) Prior to the Closing Date, the Company and the Selling Shareholder
shall have furnished to you such further information, certificates and documents
as you may reasonably request.
(l) At the Closing Date, the ADSs, including the ADSs representing the
Registered Shares, continue to be quoted on the National Association of
Securities Dealers Automated Quotation National Market System.
If any of the conditions specified in this Section 7 shall not have been
fulfilled when and as required by this Agreement, or if any of the certificates,
opinions, written statements or letters furnished to you or to Underwriter's
Counsel pursuant to this Section 7 shall not be in all material respects
reasonably satisfactory in form and substance to you and to Underwriter's
Counsel, all of your obligations hereunder may be cancelled by you at, or at any
time prior to, the Closing Date. Notice of such cancellation shall be given to
the Company and the Selling Shareholder in writing, or by telephone, facsimile,
telex or telegraph, confirmed in writing.
8. Indemnification.
(a) The Company agrees to indemnify and hold harmless each of (i) the
Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act and (ii)
the Selling Shareholder and each person, if any, who controls the Selling
Shareholder within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act against any and all losses, liabilities, claims, damages and
expenses whatsoever as incurred (including but not limited to attorneys' fees
and any and all expenses whatsoever incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which it may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
registration statement for the registration of the Registered Shares, as
originally filed, or any amendment thereof, or the Prospectus, or in any
supplement thereto or amendment thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that with respect to any untrue statement in or omission from
any preliminary prospectus, the indemnity provided for in this Section 8 shall
not inure to the benefit of the Underwriter or the Selling Shareholder or any
person controlling the Underwriter or the Selling Shareholder to the extent that
any such losses, liabilities, claims, damages or expenses arise because (i) a
copy of the Prospectus was not delivered at or prior to the written confirmation
of the sale of ADSs and (ii) the untrue statement in or omission from the
preliminary prospectus was corrected in the Prospectus; provided, further,
however, that the Company will not be liable in any such case to the extent but
only to the extent that any such loss, liability, claim, damage or expense
arises out of or is based upon
28
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any such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by you or the Selling Shareholder expressly
for use therein; and provided, further, however, that such indemnity agreement
shall only have effect insofar as any such loss, liability, claim, damage or
expense (i) arises as a result of the neglect or default of the Company to
comply with its obligations under the Securities Act, the Exchange Act, the
Financial Services Act 1986 and other applicable law or (ii) otherwise to the
extent permitted by English Law. This indemnity agreement will be in addition to
any liability which the Company may otherwise have including under this
Agreement.
(b) The Selling Shareholder agrees to indemnify and hold harmless each of
(i) the Company, each of the directors of the Company, each of the officers of
the Company who shall have signed the Registration Statement and each other
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act and (ii) the Underwriter and each
person, if any, who controls the Underwriter within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act against any and all losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, to which it may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the registration of
the Registered Shares, as originally filed, or any amendment thereof, or the
Prospectus, or in any supplement thereto or amendment thereof, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, in each case to the extent, but only to the extent, that any
such loss, liability, claim, damage or expense arises out of or is based upon
any such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by the Selling Shareholder expressly for
use therein. This indemnity agreement will be in addition to any liability which
the Selling Shareholder may otherwise have including under this Agreement.
(c) The Underwriter agrees to indemnify and hold harmless each of (i) the
Company, each of the directors of the Company, each of the officers of the
Company who shall have signed the Registration Statement and each other person,
if any, who controls the Company within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and (ii) the Selling Shareholder and each
person, if any, who controls the Selling Shareholder within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act against any losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or otherwise, insofar as such
losses, liabilities, claims, damages or expenses (or actions in respect thereof)
arise out of or are based
29
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upon any untrue statement or alleged untrue statement of a material fact
contained in the registration statement for the registration of the Registered
Shares, as originally filed, or any filed amendment thereof, or the Prospectus,
or any amendment thereof or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that any such loss,
liability, claim, damage or expense arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company by you expressly for use therein; provided, however,
that in no case shall the Underwriter be liable or responsible for any amount in
excess of the underwriting discount and commission applicable to the ADSs
purchased by the Underwriter hereunder. This indemnity will be in addition to
any liability which the Underwriter may otherwise have including under this
Agreement. The Company and the Selling Shareholder acknowledge that the
statements set forth in the third paragraph and the last sentence of the ninth
paragraph in the section of the Prospectus entitled "Underwriting" constitute
the only information furnished in writing by the Underwriter expressly for use
in the registration statement for the registration of the Registered Shares, as
originally filed, or any filed amendment thereof, or any related preliminary
prospectus or the Prospectus, or any amendment thereof or supplement thereto, as
the case may be.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 8). In case any such action is
brought against any indemnified party, and it notifies an indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel satisfactory to
such indemnified party. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any such
case, but the fees and expenses of such counsel shall be at the expense of such
indemnified party or parties unless (i) the employment of such counsel shall
have been authorized in writing by one of the indemnifying parties in connection
with the defense of such action, (ii) the indemnifying parties shall not have
employed counsel to have charge of the defense of such action within a
reasonable time after notice of commencement of the action, or (iii) such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to one or all of the indemnifying parties (in which case the
indemnifying parties shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses shall be borne by the indemnifying parties. Anything in
this subsection to the contrary notwithstanding, an indemnifying party shall not
be liable for any settlement of any claim or action effected without its written
consent; provided, however, that such consent was not unreasonably withheld.
9. Contribution. In order to provide for contribution in circumstances in
which the indemnification provided for in Section 8 hereof is for any reason
held to be unavailable from
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any indemnifying party or is insufficient to hold harmless a party indemnified
thereunder, the Company, the Selling Shareholder and the Underwriter shall
contribute to the aggregate losses, liabilities, claims, damages and expenses of
the nature contemplated by such indemnification provision (including any
investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company, any contribution received by
the Company from persons, other than the Underwriter and the Selling
Shareholder, who may also be liable for contribution, including persons who
control the Company within the meaning of Section 15 of the Act or Section 20(a)
of the Exchange Act, officers of the Company who signed the Registration
Statement and directors of the Company) as incurred, to which the Company, the
Selling Shareholder and the Underwriter may be subject, in such proportions as
is appropriate to reflect the relative benefits received by the Selling
Shareholder and the Underwriter from the offering of the ADSs or, if such
allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 8 hereof, in such proportion as is appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Company, the Selling Shareholder and the Underwriter in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations;
provided, however, that such contribution shall only have effect insofar as any
such loss, liability, claim, damage or expense (i) arises as a result of the
neglect or default of the Company to comply with its obligations under the
Securities Act, the Exchange Act, the Financial Services Act 1986 and other
applicable law or (ii) otherwise to the extent permitted by English Law. The
relative benefits received by the Selling Shareholder on the one hand and the
Underwriter on the other hand shall be deemed to be in the same proportion as
(x) the total proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Selling Shareholder
and (y) the underwriting discounts and commissions received by the Underwriter.
The relative fault of the Company, the Selling Shareholder and the Underwriter
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company, the
Selling Shareholder or the Underwriter and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Selling Shareholder and the Underwriter
agree that it would not be just and equitable if contribution pursuant to this
Section 9 were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this Section 9, (i) in no case shall
the Underwriter be liable or responsible for any amount in excess of the
underwriting discount and commission applicable to the ADSs purchased by the
Underwriter hereunder, and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. Notwithstanding the provisions of this Section 9 and the
preceding sentence, the Underwriter shall not be required to contribute any
amount in excess of the amount by which the total price at which the ADSs
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that the Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. For purposes
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of this Section 9, each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act shall have
the same rights to contribution as the Underwriter, and each person, if any, who
controls the Company or the Selling Shareholder within the meaning of Section 15
of the Act or Section 20(a) of the Exchange Act, each officer of the Company who
shall have signed the Registration Statement and each director of the Company
shall have the same rights to contribution as the Company or the Selling
Shareholder, as the case may be, subject in each case to clause (i) and (ii) of
this Section 9. Any party entitled to contribution will, promptly after receipt
of notice of commencement of any action, suit or proceeding against such party
in respect of which a claim for contribution may be made against another party
or parties, notify each party or parties from whom contribution may be sought,
but the omission to so notify such party or parties shall not relieve the party
or parties from whom contribution may be sought from any obligation it or they
may have under this Section 9 or otherwise. No party shall be liable for
contribution with respect to any action or claim settled without its consent;
provided, however, that such consent was not unreasonably withheld.
10. Survival of Representations and Agreements. All representations and
warranties, covenants and agreements of the Underwriter, the Company and the
Selling Shareholder contained in this Agreement, including the agreements
contained in Sections 3, 5 and 6, the indemnity agreements contained in Section
8 and the contribution agreements contained in Section 9, shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of the Underwriter or any controlling person thereof, by or on behalf of
the Company, any of its officers and directors or any controlling person thereof
or by or on behalf of the Selling Shareholder or any controlling person thereof,
and shall survive delivery of and payment for the ADSs to and by the
Underwriter. The representations contained in Sections 1 and 2 and the
agreements contained in Sections 2, 5, 8, 9 and 11(c) hereof shall survive the
termination of this Agreement, including termination pursuant to Section 11
hereof.
11. Termination.
(a) You shall have the right to terminate this Agreement at any time prior
to the Closing Date if (A) any domestic or international event or act or
occurrence has materially disrupted, or in your opinion will in the immediate
future materially disrupt, the market for the Company's securities or securities
in general; or (B) if trading on the New York or American Stock Exchanges or on
NASDAQ or on the London Stock Exchange shall have been suspended, or minimum or
maximum prices for trading shall have been fixed, or maximum ranges for prices
for securities shall have been required, on the New York or American Stock
Exchanges or on NASDAQ or on the London Stock Exchange by the New York or
American Stock Exchanges or NASDAQ or the London Stock Exchange or by order of
the Commission or any other governmental authority having jurisdiction; or (C)
if a banking moratorium has been declared by a state or federal authority or
U.K. authority or if any new restriction materially adversely affecting the
distribution of the ADSs or the exchange of ADSs for ordinary shares shall have
become effective; or (D) (i) if the United States or Great Britain becomes
engaged in hostilities or there is an escalation of hostilities involving the
United States or there is a declaration of a national emergency or war by the
United States or (ii) if there shall have been such change in political,
financial or economic conditions, if the effect of any such event in (i) or (ii)
in your
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<PAGE>
judgment makes it impracticable or inadvisable to proceed with the offering,
sale and delivery of the ADSs on the terms contemplated by the Prospectus.
(b) Any notice of termination pursuant to this Section 11 shall be by
telephone, facsimile, telex, or telegraph, confirmed in writing by letter.
(c) If this Agreement is terminated or if the sale of the ADSs provided for
herein is not consummated because of any refusal, inability or failure on the
part of the Selling Shareholder to perform any agreement herein, comply with any
provision hereof or fulfill the conditions set forth in Sections 7(c) and (g) of
this Agreement, the Selling Shareholder will, subject to demand by you,
reimburse you for all out-of-pocket expenses (including the fees and expenses of
your counsel) incurred by you in connection herewith. Except as explicitly set
forth in the preceding sentence, if this Agreement shall be terminated
(otherwise than by you pursuant to this Section 11) or if the sale of the ADSs
provided for herein is not consummated because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or comply
with any provision hereof, or because any condition to your obligations set
forth herein is not satisfied, the Company will, subject to demand by you,
reimburse you for all your out-of-pocket expenses (including the fees and
expenses of your counsel) incurred by you in connection herewith.
12. Notices. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing and, if sent to the
Underwriter, shall be mailed, delivered or sent by facsimile, telex or telegraph
and confirmed in writing to Bear, Stearns & Co. Inc., 245 Park Avenue, New York,
NY 10167, Attention: Equity Syndicate; facsimile number (212) 272 - 3485; if
sent to the Company, shall be mailed, delivered or sent by facsimile, telex or
telegraph and confirmed in writing to the Company, East Anton Andover,
Hampshire, England SP10 5RG, Attention: Company Secretary; facsimile number
44-1264-332-879; and if sent to the Selling Shareholder, shall be mailed,
delivered or sent by facsimile, telex or telegraph and confirmed in writing to
(i) Yamanouchi Group Holding Inc., c/o Yamanouchi Pharmaceutical Co., Ltd., 3-11
Nihonbashi-Honcho 2-chome, Chuo-ku, Tokyo 103, Japan, Attention: Yamanouchi
Group Holding Inc.-President, facsimile number 813-3244-3245, and (ii)
Yamanouchi Group Holding Inc., 4747 Willow Road, Mail Stop: C-300, Pleasanton,
CA 94588-2740, Attention: Yamanouchi Group Holding Inc.-Treasurer, facsimile
number (925) 924-3727.
13. Parties. This Agreement shall inure solely to the benefit of, and shall
be binding upon, the Underwriter, the Company, the Selling Shareholder and the
controlling persons, directors, officers, employees and agents referred to in
Sections 8 and 9, and their respective successors and assigns, and no other
person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Agreement or any provision
herein contained. The term "successors and assigns" shall not include a
purchaser, in its capacity as such, of ADSs from the Underwriter. The
obligations of the Selling Shareholder hereunder shall not be terminated by
operation of law, whether by the dissolution of such corporation or by the
occurrence of any other event.
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<PAGE>
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, but without regard to
principles of conflicts of law.
15. Consent to Jurisdiction; Waiver of Immunities.
(a) The Company hereby (i) irrevocably submits to the jurisdiction of any
New York State or federal court sitting in the Borough of Manhattan and any
appellate court from any such court in any action or proceeding arising out of
or relating to this Agreement or any other document delivered hereunder; (ii)
irrevocably agrees that all claims in respect of any such action or proceeding
may be heard and determined in such New York State court or in such federal
court; (iii) irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding; (iv) irrevocably appoints William A. Nuerge (the "Company Process
Agent"), with an office on the date hereof at 7900 Tanner Gate Drive, Florence,
Kentucky 41042, USA, as its authorized agent to receive on its behalf and its
property service of copies of the summons and complaint and any other process
that may be made by mailing or delivering a copy of such process to the
appropriate party in care of the Company Process Agent at the Company Process
Agent's above address, represents and warrants that the Company Process Agent
has agreed to act as such, and agrees to take any and all actions, including
filing any and all documents or instruments (including for the appointment of
any successor Company Process Agent, as necessary) that may be necessary to
continue such appointment in effect; (v) authorizes and directs the Company
Process Agent to accept such service on its behalf; and (vi) agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
(b) The Selling Shareholder hereby (i) irrevocably submits to the
jurisdiction of any New York State or federal court sitting in the Borough of
Manhattan and any appellate court from any such court in any action or
proceeding arising out of or relating to this Agreement or any other document
delivered hereunder; (ii) irrevocably agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State
court or in such federal court; (iii) irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding; (iv) irrevocably appoints Tom Bishop (the "Selling
Shareholder Process Agent"), with an office on the date hereof at Yamanouchi
Group Holding Inc., 4747 Willow Road, Mail Stop: C-300, Pleasanton, CA
94588-2740 as its authorized agent to receive on its behalf and its property
service of copies of the summons and complaint and any other process that may be
made by mailing or delivering a copy of such process to the appropriate party in
care of the Selling Shareholder Process Agent at the Selling Shareholder Process
Agent's above address, represents and warrants that the Selling Shareholder
Process Agent has agreed to act as such, and agrees to take any and all actions,
including filing any and all documents or instruments (including for the
appointment of any successor Selling Shareholder Process Agent, as necessary)
that may be necessary to continue such appointment in effect; (v) authorizes and
directs the Selling Shareholder Process Agent to accept such service on its
behalf; and (vi) agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
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<PAGE>
(c) The Underwriter hereby (i) irrevocably submits to the jurisdiction of
any New York State or federal court sitting in the Borough of Manhattan and any
appellate court from any such court in any action or proceeding arising out of
or relating to this Agreement or any other document delivered hereunder; (ii)
irrevocably agrees that all claims in respect of any such action or proceeding
may be heard and determined in such New York State court or in such federal
court; (iii) irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding; and (iv) agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law
16. Counterparts. This Agreement may be signed in two or more counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
17. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
18. Severability. If any provision of this Agreement is invalid, illegal or
incapable of being enforced, the remainder of this Agreement shall not be
affected thereby and all other provisions of this Agreement shall remain in full
force and effect.
[Signature Page Follows]
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If the foregoing correctly sets forth the understanding between you, the
Company and the Selling Shareholder, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement among us.
Very truly yours,
SHIRE PHARMACEUTICALS GROUP PLC
By /s/ A C Russell
----------------------------------
Name: A C Russell
Title: Group Finance Director
YAMANOUCHI GROUP HOLDING INC.
By /s/ Kaoru Kimura
----------------------------------
Name: Kaoru Kimura
Title: President
Accepted as of the date first above written
BEAR, STEARNS & CO. INC.
By /s/ Steven R. Frank
-------------------------------------
Name: Steven R. Frank
Title: Senior Managing Director
<PAGE>
SCHEDULE I
Number of
Name of Selling Shareholder ADSs to be Sold
--------------------------- ---------------
Yamanouchi Group Holding Inc. 5,263,902
---------
Total. . . . . . . . . . . . . . . . . . . . . 5,263,902
<PAGE>
SCHEDULE II
Shire Subsidiaries Jurisdiction of Incorporation
------------------ -----------------------------
Shire Pharmaceutical Contracts Limited England and Wales
Shire Holdings Limited Bermuda
Shire Pharmaceuticals Limited England and Wales
Shire Pharmaceutical Development Limited England and Wales
Shire Holdings Europe Limited England and Wales
Rybar Laboratories Limited England and Wales
The Endocrine Centre Limited England and Wales
Sparkleflame Limited England and Wales
Shire International Licensing BV Netherlands
Shire Pharmaceuticals Quest Ltd. England and Wales
Shire France SA France
Shire Italia S.p.A Italy
Shire Deutschland GmbH & Co. KG Germany
Shire Deutschland Beteiligungs GmbH Germany
Shire Holding GmbH Germany
Shire Richwood Inc. Kentucky
Shire Laboratories Inc. Delaware
Shire Supplies U.S. LLC Delaware
Shire Holdings US Inc. Delaware
Shire US LLC Delaware
Shire Holdings AG Switzerland
Shire Pharmaceuticals Iberica SL Spain
Roberts Pharmaceutical Corporation New Jersey
Roberts Laboratories Inc. New Jersey
Monmouth Pharmaceuticals Ltd. United Kingdom
Roberts Pharma GmbH Germany
Shire Canada Inc. Canada
Roberts Investments, Inc. Delaware
Shire Pharmaceuticals, Inc. New Jersey
The following persons own qualifying shares of Shire France S.A.:
Vincent Lucet - 1 Share
Neil Harris - 1 Share
Rolf Stahel - 1 Share
Wilson Totten - 1 Share
The remainder of the shares of Shire France S.A. and the other subsidiaries
listed above are owned by Shire Pharmaceuticals Group plc and/or its
subsidiaries.
<PAGE>
SCHEDULE III
Ordinary shares as of September 22, 2000: 255,457,601
Options outstanding as of August 31, 2000: 9,096,162
