INVESTMENT AGREEMENT by and among THE PURCHASERS NAMED HEREIN and HANA BIOSCIENCES, INC. JUNE 7, 2010
EXHIBIT
10.1
Execution
Version
by
and among
THE
PURCHASERS NAMED HEREIN
and
HANA
BIOSCIENCES, INC.
JUNE
7, 2010
TABLE OF
CONTENTS
|
SECTION
1.
|
AUTHORIZATION
OF SECURITIES
|
1
|
|
|
SECTION
2.
|
PURCHASE
AND SALE OF SECURITIES
|
2
|
|
|
2.1.
|
Issuance
and Sale of First Tranche Shares
|
2
|
|
|
2.2.
|
Issuances
Subject to Stockholder Approval
|
2
|
|
|
2.3.
|
Issuances
if No Stockholder Approval by Stockholder Approval Outside
Date
|
4
|
|
|
2.4.
|
Closings
and Closing Dates.
|
5
|
|
|
2.5.
|
Closing
Adjustments.
|
8
|
|
|
2.6.
|
Deerfield
Participation Rights
|
11
|
|
|
SECTION
3.
|
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
|
13
|
|
|
3.1.
|
Corporate
Organization
|
13
|
|
|
3.2.
|
No
Subsidiaries
|
13
|
|
|
3.3.
|
Capitalization
|
14
|
|
|
3.4.
|
Authorization
|
15
|
|
|
3.5.
|
No
Conflicts
|
16
|
|
|
3.6.
|
Approvals
|
16
|
|
|
3.7.
|
Reports
and Financial Statements
|
17
|
|
|
3.8.
|
Absence
of Certain Developments
|
19
|
|
|
3.9.
|
Compliance
|
19
|
|
|
3.10.
|
Litigation
|
20
|
|
|
3.11.
|
Absence
of Undisclosed Liabilities
|
20
|
|
|
3.12.
|
Change
in Ownership
|
20
|
|
|
3.13.
|
Employment
Matters
|
20
|
|
|
3.14.
|
Tax
Matters
|
22
|
|
|
3.15.
|
Contracts
|
22
|
|
|
3.16.
|
Intellectual
Property
|
25
|
|
|
3.17.
|
Insurance
|
26
|
|
|
3.18.
|
Environmental
Liability
|
26
|
|
|
3.19.
|
Transactions
with Related Parties
|
27
|
|
|
3.20.
|
Property
|
27
|
|
|
3.21.
|
Indebtedness
|
27
|
|
|
3.22.
|
Accuracy
of Information
|
28
|
|
|
3.23.
|
Registration
Rights; Voting Rights
|
28
|
|
|
3.24.
|
Private
Offering
|
28
|
|
|
3.25.
|
Investment
Banking
|
28
|
|
|
3.26.
|
Takeover
Provision
|
28
|
|
|
3.27.
|
Miscellaneous
Securities Law Matters
|
29
|
|
|
3.28.
|
Accountants
|
29
|
|
|
3.29.
|
FDA
and Related Matters
|
29
|
(i)
|
SECTION
4.
|
REPRESENTATIONS
AND WARRANTIES OF THE PURCHASERS
|
30
|
|
|
SECTION
5.
|
ADDITIONAL
AGREEMENTS OF THE PARTIES
|
31
|
|
|
5.1.
|
Transfer
Restrictions
|
31
|
|
|
5.2.
|
Standstill
|
32
|
|
|
5.3.
|
Buyout
Transactions
|
34
|
|
|
5.4.
|
Preemptive
Rights
|
34
|
|
|
5.5.
|
Reasonable
Best Efforts; Further Assurances
|
36
|
|
|
5.6.
|
Indemnity
|
37
|
|
|
5.7.
|
Consents
and Approvals; Stockholder Approval; HSR Act
|
39
|
|
|
5.8.
|
Use
of Proceeds; Prohibition on Certain Actions
|
41
|
|
|
5.9.
|
Takeover
Provisions
|
42
|
|
|
5.10.
|
Section
16 Matters
|
42
|
|
|
5.11.
|
Registration
and Listing
|
43
|
|
|
5.12.
|
Private
Offering
|
43
|
|
|
5.13.
|
Form
D and Blue Sky
|
43
|
|
|
5.14.
|
Venture
Capital Qualifying Investment
|
44
|
|
|
5.15.
|
Tax
Treatment of Preferred Stock
|
45
|
|
|
5.16.
|
Board
Representation
|
45
|
|
|
5.17.
|
Corporate
Opportunity
|
47
|
|
|
5.18.
|
Legends
|
48
|
|
|
5.19.
|
Right
of First Offer.
|
49
|
|
|
5.20.
|
Certificate
of Elimination
|
49
|
|
|
5.21.
|
Reverse
Stock Split; Authorized Common Stock
|
49
|
|
|
5.22.
|
Proposed
Alternate Financing
|
50
|
|
|
5.23.
|
Limitation
on Conversion
|
51
|
|
|
5.24.
|
Notice
of Marketing Approval
|
52
|
|
|
SECTION
6.
|
CONDITIONS
TO THE FIRST CLOSING
|
52
|
|
|
6.1.
|
Purchasers’
Actions to be Taken at the First Closing
|
52
|
|
|
SECTION
7.
|
CONDITIONS
TO THE SECOND CLOSING
|
54
|
|
|
7.1.
|
Purchasers’
Conditions to the Second Closing
|
54
|
|
|
7.2.
|
The
Company’s Conditions to the Second Closing
|
55
|
|
|
SECTION
8.
|
CLOSING
DELIVERIES FOR ADDITIONAL PURCHASES OF SERIES A PREFERRED
|
56
|
|
|
8.1.
|
Series
A-1 Additional Investment Closing, the Series A-2 Subsequent Investment
Closing, a Series A-1 Annex I Additional Investment Closing and a Series
A-1 Annex I Subsequent Investment Closing
|
56
|
|
|
SECTION
9.
|
INTERPRETATION
OF THIS AGREEMENT
|
57
|
|
|
9.1.
|
Terms
Defined
|
57
|
|
|
9.2.
|
Accounting
Principles
|
72
|
|
|
9.3.
|
Governing
Law
|
72
|
|
|
9.4.
|
Paragraph
and Section Headings
|
72
|
(ii)
|
SECTION
10.
|
MISCELLANEOUS
|
72
|
|
|
10.1.
|
Notices
|
72
|
|
|
10.2.
|
Expenses
and Taxes
|
73
|
|
|
10.3.
|
Reproduction
of Documents
|
74
|
|
|
10.4.
|
Survival
|
74
|
|
|
10.5.
|
Successors
and Assigns
|
75
|
|
|
10.6.
|
Entire
Agreement; Amendment and Waiver
|
75
|
|
|
10.7.
|
Severability
|
75
|
|
|
10.8.
|
Limitation
on Enforcement of Remedies
|
75
|
|
|
10.9.
|
Lost
Certificates Evidencing Shares; Exchange.
|
76
|
|
|
10.10.
|
Terms
Generally
|
76
|
|
|
10.11.
|
Draftsmanship
|
76
|
|
|
10.12.
|
Counterparts
|
77
|
|
|
10.13.
|
Several
and Not Joint
|
77
|
|
|
10.14.
|
Specific
Performance
|
77
|
|
|
10.15.
|
No
Recourse
|
77
|
|
Exhibit
A
|
Series
A-1 Preferred Certificate of Designation
|
|
Exhibit
B
|
Series
A-2 Preferred Certificate of Designation
|
|
Exhibit
C
|
Opinion
of Xxxxxxxxxx & Xxxxx, P.A.
|
|
Exhibit
D
|
Registration
Rights Agreement
|
|
Exhibit
E
|
Certificate
of Conversion
|
|
Exhibit
F
|
Form
of Voting Agreement
|
|
Exhibit
G
|
Form
of Indemnification Side Letter
|
|
Exhibit
H
|
Form
of Bylaws Amendment
|
|
Exhibit
I
|
Form
of Certificate of Elimination
|
|
Exhibit
J
|
Form
of Charter Amendment
|
|
Exhibit
K
|
Form
of Indemnification
Agreement
|
(iii)
HANA
BIOSCIENCES, INC.
Dated
as of June 7, 2010
Hana
Biosciences, Inc., a Delaware corporation (the “Company”), hereby
agrees with (i) Warburg Pincus Private Equity X, L.P., a Delaware limited
partnership (together with any successor, assign or transferee, including any
transferee of the Securities (as defined herein), “WPX”), and Warburg
Pincus X Partners, L.P., a Delaware limited partnership (together with any
successor, assign or transferee, including any transferee of the Securities,
“WP Partners”,
and together with WPX, each a “WP Purchaser” and
collectively the “WP
Purchasers”), and (ii) Deerfield Private Design Fund, L.P., a Delaware
limited partnership (together with any successor, assign or transferee,
including any transferee of the Securities, “Deerfield Private
Design”), Deerfield Private Design International, L.P., a limited
partnership organized under the laws of the British Virgin Islands (together
with any successor, assign or transferee, including any transferee of the
Securities, “Deerfield
Private Design International”), Deerfield Special Situation Fund, L.P., a
Delaware limited partnership (together with any successor, assign or transferee,
including any transferee of the Securities, “Deerfield Special
Situation”), and Deerfield Special Situations Fund International Limited,
an entity organized under the laws of the British Virgin Islands (together with
any successor, assign or transferee, including any transferee of the Securities,
“Deerfield Special
Situations Fund International”, and together with Deerfield Private
Design, Deerfield Private Design International and Deerfield Special Situation,
each a “Deerfield
Purchaser” and collectively the “Deerfield
Purchasers”, and together with the WP Purchasers, each a “Purchaser” and
collectively the “Purchasers”), as
follows:
|
SECTION
1.
|
AUTHORIZATION
OF
SECURITIES
|
The
Company has duly authorized the issuance and sale of (i) 1,100,000 shares of the
Company’s Series A-1 Convertible Preferred Stock (the “Series A-1
Preferred”), which shares of Series A-1 Preferred will be, upon issuance,
convertible into authorized but unissued shares (“Series A-1 Conversion
Shares”) of common stock, par value $0.001 per share, of the Company (the
“Common
Stock”), and will have the terms set forth in the Certificate of
Designation for such Series A-1 Preferred attached hereto as Exhibit A (the “Series A-1 Certificate of
Designation”), and (ii) 400,000 shares of the Company’s Series A-2
Convertible Preferred Stock (the “Series A-2
Preferred”; the Series A-1 Preferred and the Series A-2 Preferred are
collectively referred to herein as the “Series A Preferred”),
which shares of Series A-2 Preferred will be, upon issuance, convertible into
authorized but unissued shares (“Series A-2 Conversion
Shares”) of Common Stock and will have the terms set forth in the
Certificate of Designation for such Series A-2 Preferred attached hereto as
Exhibit B (the
“Series A-2
Certificate of Designation”). References to a “Schedule” or an
“Exhibit” are, unless otherwise specified, to a Schedule or an Exhibit attached
to this Agreement, including the Transaction Documents. Capitalized terms
used herein and not otherwise defined shall have the meanings ascribed to such
terms in Section
9.1 of this Agreement.
|
SECTION
2.
|
PURCHASE AND SALE OF
SECURITIES
|
2.1.
Issuance and Sale of First
Tranche Shares. Subject to the terms and conditions set forth in
this Agreement, and in reliance upon the Company’s and each Purchaser’s
representations set forth herein, on the First Closing Date (as defined below),
the Company shall issue and sell to the Purchasers free and clear of all Liens,
and the Purchasers shall severally purchase from the Company, the number of
shares of Series A-1 Preferred set forth opposite each Purchaser’s name on Schedule 2.1
(collectively such shares are referred to as the “First Tranche
Shares”) for the aggregate cash purchase price set forth opposite each
Purchaser’s name on Schedule 2.1 for such
First Tranche Shares (such aggregate purchase price, the “First Tranche Purchase
Price”). The purchase and sale of the First Tranche Shares shall be
effected on the First Closing Date by (i) the Company executing and delivering
to the WP Purchasers, duly registered in each WP Purchaser’s name, duly executed
stock certificates evidencing the First Tranche Shares being purchased by each
WP Purchaser, and (ii) the Company executing and delivering to the Deerfield
Purchasers, duly registered in each Deerfield Purchaser’s name, duly executed
stock certificates evidencing the First Tranche Shares being purchased by each
Deerfield Purchaser, in the case of each of (i) and (ii), against delivery by
such Purchaser to the Company of the portion of First Tranche Purchase Price
payable by such Purchaser, by wire transfer of immediately available funds to
the Company’s bank account previously provided to the Purchasers by the Company
(the “Company Bank
Account”).
2.2.
Issuances Subject to
Stockholder Approval. Section 2.2 shall be
applicable solely in the event Stockholder Approval is obtained on or prior to
the Stockholder Approval Outside Date and Sections 2.2(b) and
2.2(c) shall be
subject to Section
2.6:
(a) Subject
to the terms and conditions set forth in this Agreement, and in reliance upon
the Company’s and each Purchaser’s representations set forth herein, on the
Second Closing Date (as defined below), the Company shall issue to the
Purchasers for no additional consideration and free and clear of all Liens, the
Additional Series A-1 Preferred Shares issuable to each Purchaser. As used
herein, “Additional
Series A-1 Preferred Shares” to be issued to a Purchaser shall mean the
number of shares of Series A-1 Preferred determined by dividing (A) the
aggregate accretion (determined pursuant to Annex I of the Series A-1
Certificate of Designation) accrued as of the Second Closing Date on the shares
of Series A-1 Preferred owned by such Purchaser on the Second Closing Date by
(B) $100.
- 2
-
(b) The
WP Purchasers shall have the right, but not the obligation, to purchase up to
the maximum number of shares of Series A-1 Preferred set forth on Schedule 2.2(b) (the
“Maximum Series A-1
Additional Investment Shares”), which right shall be exercisable in one
transaction or in separate transactions in accordance with Section 2.4(c) (each
such purchase, a “Series A-1 Additional
Investment Tranche”); provided that (i) for
the avoidance of doubt, the WP Purchasers may elect to purchase more than one
Series A-1 Additional Investment Tranche so long as the aggregate number of
Series A-1 Additional Investment Shares purchased under this Section 2.2(b) does
not exceed the Maximum Series A-1 Additional Investment Shares, and (ii) subject
to Section
5.22(b), in the event the WP Purchasers elect to purchase a Series A-1
Additional Investment Tranche, they shall be obligated to purchase at least the
“Minimum Number of Series A-1 Preferred” as indicated on Schedule 2.2(b) (the
“Minimum Series A-1
Additional Investment Shares”) in connection with such purchase, unless,
as a result of a previous Series A-1 Additional Investment Tranche, the
difference between (x) the Maximum Series A-1 Additional Investment Shares, and
(y) the Series A-1 Preferred purchased in such previous Series Additional
Investment Tranche, is less than the Minimum Series A-1 Additional Investment
Shares, in which case the WP Purchasers may elect to purchase such
difference. Subject to the foregoing sentence and the other terms and
conditions set forth in this Agreement, and in reliance upon the Company’s and
the WP Purchasers’ representations set forth herein, on a Series A-1 Additional
Investment Closing Date (as defined below), the Company shall issue and sell to
the WP Purchasers free and clear of all Liens, and the WP Purchasers shall
purchase from the Company, the number of shares of Series A-1 Preferred elected
to be purchased by the WP Purchasers on such Series A-1 Additional Investment
Closing Date (collectively the shares to be sold and purchased on such Series
A-1 Additional Investment Closing Date are referred to as “Series A-1 Additional
Investment Shares”) for the aggregate cash purchase equal to the product
of the price per share set forth on Schedule 2.2(b) and
the applicable number of Series A-1 Additional Investment Shares (the “Series A-1 Additional
Investment Purchase Price”), which Series A-1 Additional Investment
Shares and Series A-1 Additional Investment Purchase Price shall be allocated
between the WP Purchasers as set forth in a Series A-1 Additional Investment
Notice (as defined below). The purchase and sale of Series A-1 Additional
Investment Shares shall be effected on the applicable Series A-1 Additional
Investment Closing Date by the Company executing and delivering to the WP
Purchasers, duly registered in each WP Purchaser’s name, duly executed stock
certificates evidencing the Series A-1 Additional Investment Shares being
purchased by such WP Purchaser on such Closing Date, against delivery by such WP
Purchaser to the Company of the Series A-1 Additional Investment Purchase Price
payable by such WP Purchaser for such Shares, in each case as set forth in a
Series A-1 Additional Investment Notice, by wire transfer of immediately
available funds to the Company Bank Account.
(c) The
WP Purchasers shall have the right (the “Series A-2 Subsequent
Investment Right”), but not the obligation, to purchase up to the number
of shares of Series A-2 Preferred set forth on Schedule 2.2(c),
which right shall be exercisable as set forth in Section 2.4(d)
hereof. Subject to the foregoing sentence and the other terms and
conditions set forth in this Agreement, and in reliance upon the Company’s and
the WP Purchasers’ representations set forth herein, on the Series A-2
Subsequent Investment Closing Date (as defined below), the Company shall issue
and sell to the WP Purchasers free and clear of all Liens, and the WP Purchasers
shall purchase from the Company, the Series A-2 Subsequent Investment Shares (as
defined below) for the aggregate cash purchase price determined by multiplying a
per share purchase price of $100 for each share of Series A-2 Preferred by the
Series A-2 Subsequent Investment Shares (the “Series A-2 Subsequent
Investment Purchase Price”), which Series A-2 Subsequent Investment
Shares and Series A-2 Subsequent Investment Purchase Price shall be allocated
between the WP Purchasers as set forth in the Series A-2 Subsequent Investment
Notice (as defined below). The purchase and sale of Series A-2 Subsequent
Investment Shares shall be effected on the Series A-2 Subsequent Investment
Closing Date by the Company executing and delivering to the WP Purchasers, duly
registered in each Purchaser’s name, duly executed stock certificates evidencing
the Series A-2 Subsequent Investment Shares being purchased by such WP
Purchaser, against delivery by such WP Purchaser to the Company of the Series
A-2 Subsequent Investment Purchase Price payable by such WP Purchaser, in each
case as set forth in the Series A-2 Subsequent Investment Notice, by wire
transfer of immediately available funds to the Company Bank
Account.
- 3
-
2.3.
Issuances if No Stockholder
Approval by Stockholder Approval Outside Date. Section 2.3 shall be
applicable solely after the Stockholder Approval Outside Date in the event
Stockholder Approval is not obtained by the Stockholder Approval Outside Date
and shall be subject to Section
2.6:
(a) The
WP Purchasers shall have the right, but not the obligation, to purchase up to
the maximum number of shares of Series A-1 Preferred set forth on Schedule 2.3(a) (the
“Maximum Series A-1
Annex I Additional Investment Shares”), which right shall be exercisable
in one transaction or in a series of separate transactions in accordance with
Section 2.4(e)
(each such purchase, a “Series A-1 Annex I
Additional Investment Tranche”); provided that (i) for
the avoidance of doubt, the WP Purchasers may elect to purchase more than one
Series A-1 Annex I Additional Investment Tranche so long as the aggregate number
of Series A-1 Annex I Additional Investment Shares purchased under this Section 2.3(a) does
not exceed the Maximum Series A-1 Annex I Additional Investment Shares, and (ii)
subject to Section
5.22(b), in the event the WP Purchasers elect to purchase a Series A-1
Annex I Additional Investment Tranche, they shall be obligated to purchase at
least the “Minimum Number of Series A-1 Annex I Preferred” as indicated on Schedule 2.3(a) (the
“Minimum Series A-1
Annex I Additional Investment Shares”) in connection with such purchase,
unless, as a result of previous Series A-1 Annex I Additional Investment
Tranches, the difference between (x) the Maximum Series A-1 Annex I Additional
Investment Shares, and (y) the sum of Series A-1 Preferred purchased in previous
Series A-1 Annex I Additional Investment Tranches, is less than the Minimum
Series A-1 Annex I Additional Investment Shares, in which case the WP Purchasers
may elect to purchase such difference. Subject to the foregoing sentence
and the other terms and conditions set forth in this Agreement, and in reliance
upon the Company’s and the WP Purchasers’ representations set forth herein, on a
Series A-1 Annex I Additional Investment Closing Date (as defined below), the
Company shall issue and sell to the WP Purchasers free and clear of all Liens,
and the WP Purchasers shall purchase from the Company, the number of shares of
Series A-1 Preferred elected to be purchased by the WP Purchasers on such Series
A-1 Annex I Additional Investment Closing Date (collectively the shares to be
sold and purchased on such Series A-1 Annex I Additional Investment Closing Date
are referred to as “Series A-1 Annex I
Additional Investment Shares”) for the aggregate cash purchase equal to
the product of the price per share set forth on Schedule 2.3(a) and
the applicable number of Series A-1 Annex I Additional Investment Shares (the
“Series A-1 Annex I
Additional Investment Purchase Price”), which Series A-1 Annex I
Additional Investment Shares and Series A-1 Annex I Additional Investment
Purchase Price shall be allocated between the WP Purchasers as set forth in a
Series A-1 Annex I Additional Investment Notice (as defined below). The
purchase and sale of Series A-1 Annex I Additional Investment Shares shall be
effected on the applicable Series A-1 Annex I Additional Investment Closing Date
by the Company’s executing and delivering to the WP Purchasers, duly registered
in each WP Purchaser’s name, duly executed stock certificates evidencing the
Series A-1 Annex I Additional Investment Shares being purchased by such WP
Purchaser on such Closing Date, against delivery by such WP Purchaser to the
Company of the Series A-1 Annex I Additional Investment Purchase Price payable
by such WP Purchaser for such Shares, in each case as set forth in a Series A-1
Annex I Additional Investment Notice, by wire transfer of immediately available
funds to the Company Bank Account.
- 4
-
(b) The
WP Purchasers shall have the right, but not the obligation, to purchase up to
the maximum number of shares of Series A-1 Preferred set forth on Schedule 2.3(b) (the
“Maximum Series A-1
Annex I Subsequent Investment Shares”), which right shall be exercisable
in one transaction or in a series of separate transactions in accordance with
Section 2.4(f)
(each such purchase, a “Series A-1 Annex I
Subsequent Investment Tranche”); provided that (i) for
the avoidance of doubt, the WP Purchasers may elect to purchase more than one
Series A-1 Annex I Subsequent Investment Tranche so long as the aggregate number
of Series A-1 Annex I Subsequent Investment Shares purchased under this Section 2.3(b) does
not exceed the Maximum Series A-1 Annex I Subsequent Investment Shares, and (ii)
subject to Section
5.22(b), in the event the WP Purchasers elect to purchase a Series A-1
Annex I Subsequent Investment Tranche, they shall be obligated to purchase at
least the “Minimum Number of Series A-1 Annex I Preferred” as indicated on Schedule 2.3(b) (the
“Minimum Series A-1
Annex I Subsequent Investment Shares”) in connection with such purchase,
unless, as a result of previous Series A-1 Annex I Subsequent Investment
Tranches, the difference between (x) the Maximum Series A-1 Annex I Subsequent
Investment Shares and (y) the sum of Series A-1 Preferred purchased in previous
Series A-1 Annex I Subsequent Investment Tranches is less than the Minimum
Series A-1 Annex I Subsequent Investment Shares, in which case the WP Purchasers
may elect to purchase such difference. Subject to the foregoing sentence
and the other terms and conditions set forth in this Agreement, and in reliance
upon the Company’s and the WP Purchasers’ representations set forth herein, on a
Series A-1 Annex I Subsequent Investment Closing Date (as defined below), the
Company shall issue and sell to the WP Purchasers free and clear of all Liens,
and the WP Purchasers shall purchase from the Company, the number of shares of
Series A-1 Preferred elected to be purchased by the WP Purchasers on such Series
A-1 Annex I Subsequent Investment Closing Date (collectively the shares to be
sold and purchased on such Series A-1 Annex I Subsequent Investment Closing Date
are referred to as “Series A-1 Annex I
Subsequent Investment Shares”) for the aggregate cash purchase equal to
the product of the price per share set forth on Schedule 2.3(b) and
the applicable number of Series A-1 Annex I Subsequent Investment Shares (the
“Series A-1 Annex I
Subsequent Investment Purchase Price”), which Series A-1 Annex I
Subsequent Investment Shares and Series A-1 Annex I Subsequent Investment
Purchase Price shall be allocated between the WP Purchasers as set forth in a
Series A-1 Annex I Subsequent Investment Notice (as defined below). The
purchase and sale of Series A-1 Annex I Subsequent Investment Shares shall be
effected on the applicable Series A-1 Annex I Subsequent Investment Closing Date
by the Company’s executing and delivering to the WP Purchasers, duly registered
in each WP Purchaser’s name, duly executed stock certificates evidencing the
Series A-1 Annex I Subsequent Investment Shares being purchased by such WP
Purchaser on such Closing Date, against delivery by such WP Purchaser to the
Company of the Series A-1 Annex I Subsequent Investment Purchase Price payable
by such WP Purchaser for such Shares, in each case as set forth in a Series A-1
Annex I Subsequent Investment Notice by wire transfer of immediately available
funds to the Company Bank Account.
2.4.
Closings and Closing
Dates.
(a) The
closing of the transactions contemplated by Section 2.1 of this
Agreement (the “First
Closing”) shall take place at 10:00 a.m., New York City time, on the date
hereof immediately following the execution and delivery of this Agreement by
each of the parties hereto (the “First Closing
Date”).
- 5
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(b) The
closing of the issuances contemplated by Section 2.2(a) of
this Agreement (the “Second Closing”)
shall take place at 10:00 a.m., New York City time, on the third Business Day
immediately following the date on which each of the conditions to the Second
Closing set forth in Sections 7.1 and
7.2 hereof, as
applicable, are satisfied or waived by the applicable party in the manner
permitted by Sections
7.1 and 7.2, as applicable
(other than those conditions that by their nature are to be satisfied by actions
taken at the Second Closing, which must be satisfied or waived at the Second
Closing), or on such other date as may be mutually agreed in writing by the
Company and the WP Purchasers (the “Second Closing
Date”); provided, however, that the
Second Closing Date shall occur no later than the Stockholder Approval Outside
Date unless the prior written consent of the WP Purchasers is
obtained.
(c) Subject
to Section
2.2(b), in order to purchase a Series A-1 Additional Investment Tranche,
the WP Purchasers shall send notice of such to the Company and the Deerfield
Purchasers at any time prior to the Marketing Approval Date (a “Series A-1 Additional
Investment Notice”), which notice shall specify the number of shares of
Series A-1 Preferred the WP Purchasers elect to purchase as part of a Series A-1
Additional Investment Tranche at such time, a calculation of the Series A-1
Additional Investment Purchase Price therefor and the allocation of such among
the WP Purchasers (subject to the Maximum Series A-1 Additional Investment
Shares and, subject to Section 5.22(b), the
Minimum Series A-1 Additional Investment Shares). Subject to a Series A-1
Additional Investment Notice being given, the closing of the purchase of the
Series A-1 Additional Investment Tranche specified in such Series A-1 Additional
Investment Notice (a “Series A-1 Additional
Investment Closing”) shall take place at 10:00 a.m., New York City time,
on the seventh (7th)
Business Day immediately following the date on which such Series A-1 Additional
Investment Notice is given or on such later date as may be mutually agreed in
writing by the Company and the WP Purchasers (the “Series A-1 Additional
Investment Closing Date”); provided that,
subject to compliance with Section 8.1, in no
event shall such Series A-1 Additional Investment Closing Date take place later
than the fourteenth (14th)
Business Day after the date the applicable Series A-1 Additional Investment
Notice is given.
(d) Subject
to Section
2.2(c), in order to exercise the Series A-2 Subsequent Investment Right,
the WP Purchasers shall send notice of such to the Company and the Deerfield
Purchasers at any time following the date that is fifteen (15) days after the
Marketing Approval Date but on or prior to the date that is one hundred twenty
(120) days following the Marketing Approval Date (a “Series A-2 Subsequent
Investment Notice”), which notice shall specify the number of shares of
Series A-2 Preferred the WP Purchasers desire to purchase pursuant to such right
(the “Series A-2
Subsequent Investment Shares”), a calculation of the Series A-2
Subsequent Investment Purchase Price therefor and the allocation of such among
the WP Purchasers. Subject to the Series A-2 Subsequent Investment Notice
being given, the closing of the purchase of the Series A-2 Subsequent Investment
Shares (the “Series
A-2 Subsequent Investment Closing”) shall take place at 10:00 a.m., New
York City time, on the seventh (7th)
Business Day immediately following the date on which the Series A-2 Subsequent
Investment Notice is given or on such later date as may be mutually agreed in
writing by the Company and the WP Purchasers (the “Series A-2 Subsequent
Investment Closing Date”); provided that,
subject to compliance with Section 8.1, in no
event shall the Series A-2 Subsequent Investment Closing Date take place later
than the fourteenth (14th)
Business Day after the date the applicable Series A-2 Subsequent Investment
Notice is given.
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(e) Subject
to Section
2.3(a), in order to purchase a Series A-1 Annex I Additional Investment
Tranche, the WP Purchasers shall send notice of such to the Company and the
Deerfield Purchasers at any time prior to the Marketing Approval Date (a “Series A-1 Annex I
Additional Investment Notice”), which notice shall specify the number of
shares of Series A-1 Preferred the WP Purchasers elect to purchase as part of a
Series A-1 Annex I Additional Investment Tranche at such time, a calculation of
the Series A-1 Annex I Additional Investment Purchase Price therefor and the
allocation of such among the WP Purchasers (subject to the Maximum Series A-1
Annex I Additional Investment Shares and, subject to Section 5.22(b), the
Minimum Series A-1 Annex I Additional Investment Shares). Subject to a
Series A-1 Annex I Additional Investment Notice being given, the closing of the
purchase of the Series A-1 Annex I Additional Investment Tranche specified in
such Series A-1 Additional Investment Notice (a “Series A-1 Annex I
Additional Investment Closing”) shall take place at 10:00 a.m., New York
City time, on the seventh (7th)
Business Day immediately following the date on which such Series A-1 Annex I
Additional Investment Notice is given or on such later date as may be mutually
agreed in writing by the Company and the WP Purchasers (the “Series A-1 Annex I
Additional Investment Closing Date”); provided that,
subject to compliance with Section 8.1, in no
event shall such Series A-1 Annex I Additional Investment Closing Date take
place later than the fourteenth (14th)
Business Day after the date the applicable Series A-1 Annex I Additional
Investment Notice is given.
(f)
Subject to Section 2.3(b), in
order to purchase a Series A-1 Annex I Subsequent Investment Tranche, the WP
Purchasers shall send notice of such to the Company and the Deerfield Purchasers
at any time following the date that is fifteen (15) days after the Marketing
Approval Date but on or prior to the date that is one hundred twenty (120) days
following the Marketing Approval Date (a “Series A-1 Annex I
Subsequent Investment Notice”), which notice shall specify the number of
shares of Series A-1 Preferred the WP Purchasers elect to purchase as part of a
Series A-1 Annex I Subsequent Investment Tranche at such time, a calculation of
the Series A-1 Annex I Subsequent Investment Purchase Price therefor and the
allocation of such among the WP Purchasers (subject to the Maximum Series A-1
Annex I Subsequent Investment Shares and, subject to Section 5.22(b), the
Minimum Series A-1 Annex I Subsequent Investment Shares). Subject to a
Series A-1 Annex I Subsequent Investment Notice being given, the closing of the
purchase of the Series A-1 Annex I Subsequent Investment Tranche specified in
such Series A-1 Annex I Subsequent Investment Notice (a “Series A-1 Annex I
Subsequent Investment Closing”) shall take place at 10:00 a.m., New York
City time, on the seventh (7th)
Business Day immediately following the date on which such Series A-1 Annex I
Subsequent Investment Notice is given or on such later date as may be mutually
agreed in writing by the Company and the WP Purchasers (the “Series A-1 Annex I
Subsequent Investment Closing Date”); provided that,
subject to compliance with Section 8.1, in no
event shall such Series A-1 Annex I Subsequent Investment Closing Date take
place later than the fourteenth (14th)
Business Day after the date the applicable Series A-1 Annex I Subsequent
Investment Notice is given.
(g) Each
Closing shall take place at the offices of Xxxxxxx Xxxx & Xxxxxxxxx LLP, 787
Seventh Avenue, New York, New York, or such other location as the WP Purchasers
and the Company shall mutually select.
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(h)
Notwithstanding anything to the contrary set forth herein, unless waived
in writing by the WP Purchasers, the time periods to effect a Closing set forth
in this Section
2.4 shall be automatically extended to the extent of any Antitrust
Extension Period or Section 16(b) Extension Period.
(i)
The Company and the Deerfield Purchasers each acknowledge that the WP Purchasers
shall have no obligation whatsoever to exercise their rights to purchase Series
A-1 Additional Investment Shares, Series A-2 Subsequent Investment Shares,
Series A-1 Annex I Additional Investment Shares or Series A-1 Annex I Subsequent
Investment Shares and that the WP Purchasers have made no commitment or other
guarantee to purchase any such shares and the decision to exercise such rights
shall be solely within the control of the WP Purchasers.
(j)
Notwithstanding
anything to the contrary set forth herein, the WP Purchasers may revoke a Series
A-1 Additional Investment Notice, Series A-2 Subsequent Investment Notice,
Series A-1 Annex I Additional Investment Notice or Series A-1 Annex I Subsequent
Investment Notice at any time prior to the Closing applicable thereto by the WP
Purchasers advising the Company and the Deerfield Purchasers in writing of such
revocation. In the event a notice is so revoked, (i) the Deerfield
Purchasers shall no longer have any rights to purchase any Shares in connection
with such revoked notice, and (ii) the Purchasers shall retain the right to
purchase the Shares set forth in such notice in the future, subject to the terms
and conditions of this Agreement, by again complying with the procedures set
forth herein with respect to the purchase of such Shares.
2.5.
Closing
Adjustments.
(a) In
connection with a Closing hereunder, the Company shall, concurrently with the
issuance of the Shares being issued at such Closing, pay to the Purchaser
thereof an aggregate amount equal to the product of (i) the number of Shares
being issued to such Purchaser at such Closing, multiplied by (ii) the Dividend
Equivalent Amount reserved for such Shares under Section 3(d) of the Certificate
of Designation applicable to such Shares at the time of such Closing, if
any.
(b) Notwithstanding
anything in this Agreement to the contrary, unless waived in writing in advance
by the WP Purchasers, the Company shall not directly or indirectly effect or
cause to be effected any transaction with a Person (other than the WP Purchasers
and other than the issuance of the Securities contemplated pursuant to this
Agreement) that would reasonably be expected to result in a Change of Control
unless such Person shall have provided prior assurance in writing to the
Purchasers (in a form that is reasonably satisfactory to the WP Purchasers) that
the terms of this Agreement, including this Section 2.5, shall be
fully performed (i) by the Company or (ii) by such Person if it is the successor
of the Company or if the Company is its direct or indirect
subsidiary.
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(i)
In the event
that a Change of Control (other than an Exempt Change of Control) occurs after
the Second Closing and prior to issuance of the maximum number of shares of
Series A Preferred issuable pursuant to this Agreement, the WP Purchasers shall
have the right to elect to receive upon such Change of Control, which right
shall be exercisable by the WP Purchasers in their sole discretion, (A) the fair
market value of up to the Maximum Series A-1 Additional Investment Shares less
any Series A-1 Shares that have already been purchased in any Series A-1
Additional Investment Tranche (or such shares of stock or other securities or
property (including cash) into which such Series A-1 Additional Investment
Shares may have become exchangeable as a result of such Change of Control), net
of the applicable purchase price therefor hereunder, as if the WP Purchasers had
purchased such Series A-1 Additional Investment Shares immediately prior to such
Change of Control (which shall include for clarity acceleration of the accretion
on such Series A-1 Preferred as contemplated pursuant to the terms therein), and
(B) the fair market value of up to the Maximum Series A-2 Subsequent Investment
Shares less any Series A-2 Shares that have already been purchased in any Series
A-2 Subsequent Investment Tranche (or such shares of stock or other securities
or property (including cash) into which such Series A-2 Subsequent Investment
Shares may have become exchangeable as a result of such Change of Control), net
of the applicable purchase price therefor hereunder, as if the WP Purchasers had
purchased such Series A-2 Subsequent Investment Shares immediately prior to such
Change of Control (which shall include for clarity acceleration of the accretion
on such Series A-2 Preferred as contemplated pursuant to the terms therein);
provided that
the rights set forth in this Section 2.5(b)(i)
shall only be applicable if the consummation of such Change of Control occurs
after the Stockholder Approval Outside Date if the Stockholder Approval has been
obtained on or prior to the Stockholder Approval Outside Date. In the
event that the WP Purchasers elect to receive amounts under this Section 2.5(b)(i),
the Deerfield Purchasers shall be entitled to collectively receive the Deerfield
Pro Rata Portion of any such amounts and the amounts to be paid to the WP
Purchasers shall be proportionately reduced; provided, however, that the
Deerfield Purchasers shall have no right to receive any amount payable pursuant
to this Section
2.5(b)(i) if the Change of Control occurs after the Deerfield Termination
Date. Any amounts payable pursuant to this Section 2.5(b)(i)
shall be computed irrespective of whether there has been a Marketing Approval
Date.
(ii) In
the event that a Change of Control (other than an Exempt Change of Control)
occurs prior to issuance of the maximum number shares of Series A-1 Preferred
issuable pursuant to this Agreement, the WP Purchasers shall have the right to
elect to receive upon such Change of Control, which right shall be exercisable
by the WP Purchasers in their sole discretion, (A) the fair market value of up
to the Maximum Series A-1 Annex I Additional Investment Shares that could be
issued pursuant to this Agreement less any Series A-1 Annex I Additional
Investment Shares that have already been purchased (or such shares of stock or
other securities or property (including cash) into which such Series A-1 Annex I
Additional Investment Shares may have become exchangeable as a result of such
Change of Control), net of the applicable purchase price therefor hereunder, as
if the WP Purchasers had purchased such Series A-1 Annex I Additional Investment
Shares immediately prior to such Change of Control (which shall include for
clarity acceleration of the accretion on such Series A-1 Preferred as
contemplated pursuant to the terms therein), and (B) the fair market value of up
to the Maximum Series A-1 Annex I Subsequent Investment Shares less Series A-1
Annex I Subsequent Investment Shares that have previously been purchased (or
such shares of stock or other securities or property (including cash) into which
such Series A-1 Annex I Subsequent Investment Shares may have become
exchangeable as a result of such Change of Control), net of the applicable
purchase price therefor hereunder, as if the WP Purchasers had purchased such
Series A-1 Annex I Subsequent Investment Shares immediately prior to such Change
of Control (which shall include for clarity acceleration of the accretion on
such Series A-1 Preferred as contemplated pursuant to the terms therein); provided that the
rights set forth in this Section 2.5(b)(ii)
shall only be applicable if the consummation of such Change of Control occurs
after the Stockholder Approval Outside Date in the event the Stockholder
Approval has not been obtained by the Stockholder Approval Outside Date.
In the event that the WP Purchasers elect to receive amounts under this Section 2.5(b)(ii),
the Deerfield Purchasers shall be entitled to collectively receive the Deerfield
Pro Rata Portion of any such amounts and the amounts to be paid to the WP
Purchasers shall be proportionately reduced; provided, however, that the
Deerfield Purchasers shall have no right to receive any amount payable pursuant
to this Section
2.5(b)(ii) if the Change of Control occurs after the Deerfield
Termination Date. Any amounts payable pursuant to this Section 2.5(b)(ii)
shall be computed irrespective of whether there has been a Marketing Approval
Date.
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In the
event of a Change of Control (other than an Exempt Change of Control), the
Company shall provide notice of the expected date of consummation of such Change
of Control at least ten (10) Business Days prior to such date (or such shorter
date as may be permitted by the WP Purchasers), which notice shall specify its
calculation of fair market value of each share of Series A-1 Preferred and
Series A-2 Preferred hereunder, net of the applicable purchase price therefor,
and the expected date of consummation of such Change of Control (a “Change of Control
Notice”). Such fair market value shall be determined in good faith
by the Board of Directors of the Company (the “Board”) and shall be
paid in cash or, to the extent that Series A-1 Preferred or Series A-2
Preferred, as applicable, already outstanding at the time of the Change of
Control are exchangeable for securities or other property in connection with
such Change of Control, such securities or other property exchangeable in
respect of Series A-1 Preferred or Series A-2 Preferred, as applicable, in each
case net of the applicable purchase price therefor hereunder. The WP
Purchaser may elect (a “WP Change of Control
Election”) to receive amounts payable under this Section 2.5(b) by
sending a notice of such election, which notice shall specify the number of
Series A-1 Preferred and/or Series A-2 Preferred it elects to receive
consideration for hereunder, to the Company and the Deerfield Purchasers within
five (5) Business Days of receipt of a Change of Control Notice. In the
event the WP Purchasers send a WP Change of Control Election, and provided that
the Deerfield Termination Date has not yet occurred, the Deerfield Purchasers
may elect to collectively receive the Deerfield Pro Rata Portion of amounts to
be paid to the WP Purchasers by sending a notice of such to the WP Purchasers
and the Company within three (3) Business Days of receipt of the WP Change of
Control Election (which notice shall set forth the allocation of such Deerfield
Pro Rata Portion among the Deerfield Purchasers). All amounts payable to
the WP Purchasers and the Deerfield Purchasers under this Section 2.5(b) shall
be paid promptly upon a Change of Control and in any event within two (2)
Business Days of consummation of such Change of Control. All amounts
payable under this Section 2.5(b) shall
be paid to the WP Purchasers and, if applicable, the Deerfield Purchasers in
priority to any payments to the holders of Common Stock in connection with such
Change of Control. The determination of “fair market value” under this
Section 2.5(b)
shall be made by the Board acting in good faith.
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2.6.
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Deerfield
Participation Rights
|
(a) Subject
to Section
2.6(c), to the extent the WP Purchasers elect to purchase a Series A-1
Additional Investment Tranche, Series A-1 Annex I Additional Investment Tranche
or Series A-1 Annex I Subsequent Investment Tranche or to exercise the Series
A-2 Subsequent Investment Right (each, an “Additional or Subsequent
Issuance”), the Deerfield Purchasers shall collectively have the right,
but not the obligation (the “Deerfield Participation
Right”), to purchase the Deerfield Pro Rata Portion (no more and no less)
of the Series A-1 Additional Investment Shares, Series A-1 Annex I Additional
Investment Shares, Series A-1 Annex I Subsequent Investment Shares or Series A-2
Subsequent Investment Shares, as the case may be (“Deerfield Participation
Shares”), to be purchased by the WP Purchasers as part of such Additional
or Subsequent Issuance. Subject to Section 2.6(c), with
respect to an Additional or Subsequent Issuance, (i) the Deerfield Purchasers
shall jointly and severally be obligated to pay the Deerfield Pro Rata Portion
of the applicable Series A-1 Additional Investment Purchase Price, Series A-1
Annex I Additional Investment Purchase Price, Series A-1 Annex I Subsequent
Investment Purchase Price or Series A-2 Subsequent Investment Purchase Price
(“Deerfield
Participation Purchase Price”), and (ii) the number of Shares to be
purchased by the WP Purchasers in connection therewith and the purchase price
therefor shall be reduced by the Deerfield Participation Shares and the
Deerfield Participation Purchase Price, as the case may be (and the remaining
Shares and purchase price shall be allocated among the WP Purchasers in
accordance with the proportional allocation set forth in the notice sent by the
WP Purchasers to purchase such Shares).
(b) Until
the occurrence of a Deerfield Participation Right Termination
Event,
(i)
the Deerfield Purchasers
shall be deemed to have exercised the Deerfield Participation Right in
connection with each Additional or Subsequent Issuance, if any, without the need
to provide any notice to the Company or the WP Purchasers;
(ii) the
Company agrees to notify the Deerfield Purchasers of the applicable Closing Date
at least five (5) Business Days prior to the date thereof;
(iii) subject
to the receipt by the Deerfield Purchasers of the documents set forth in Sections 8.1 (unless
waived by the WP Purchasers, in which case the right to receive such documents
shall be waived with respect to all Purchasers, including the Deerfield
Purchasers) hereof with respect to the applicable Closing and the other terms
and conditions set forth in this Agreement, and in reliance upon the Company’s
and the Deerfield Purchasers’ representations set forth herein, on the
applicable Closing Date, the Company shall issue and sell to the Deerfield
Purchasers free and clear of all Liens, and the Deerfield Purchasers shall
purchase from the Company, the applicable Deerfield Participation Shares for the
applicable Deerfield Participation Purchase Price; and
(iv) subject
to Section
2.6(d), the purchase and sale of Deerfield Participation Shares shall be
effected on the applicable Closing Date by the Company’s executing and
delivering to the applicable Deerfield Purchasers, duly registered in the
applicable Deerfield Purchasers’ names, duly executed stock certificates
evidencing the applicable Deerfield Participation Shares being purchased
(allocated in accordance with Section 2.6(d)(iii)),
against delivery by the Deerfield Purchasers to the Company of the Deerfield
Participation Purchase Price payable by the Deerfield Purchasers, by wire
transfer of immediately available funds to the Company Bank
Account.
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(c) Notwithstanding
anything to the contrary set forth herein, upon the date of the occurrence of a
Deerfield Participation Right Termination Event (such date, the “Deerfield Termination
Date”), (A) subject to the Company’s right to specific performance under
Section 10.14,
the Deerfield Purchasers’ rights to purchase Shares hereunder and the Deerfield
Participation Right with respect to Additional and Subsequent Issuances shall
automatically terminate with respect to each Deerfield Purchaser, (B) Sections 2.5(b),
5.4 and 5.10 shall terminate
with respect to each Deerfield Purchaser, (C) subject to the limitations on
conversion applicable to the Deerfield Purchasers in Section 5.23 herein
(which, upon the occurrence of a Deerfield Participation Right Termination
Event, may be waived by the WP Purchasers in their sole discretion) Series A
Preferred actually purchased by the Deerfield Purchasers hereunder shall be
automatically converted effective as of the Deerfield Termination Date into
Common Stock at the then applicable conversion rates set forth in the Series A-1
Certificate of Designation or Series A-2 Certificate of Designation, as
applicable and (D) with respect to any shares of Series A-1 Preferred purchased
by the Deerfield Purchasers that are not automatically converted to Common Stock
pursuant to clause (C) above due to the limitations on conversion applicable in
Section 5.23,
the Company, with the prior written consent of the WP Purchasers, shall have the
right, but not the obligation, at any time within one hundred twenty (120) days
following the Deerfield Termination Date to repurchase any such shares of Series
A-1 Preferred for the lesser of (y) the stated value thereof plus accrued
dividends (if any) as determined in accordance with the applicable Certificate
of Designation, and (z) only with respect to shares of Series A-1 Preferred
having the terms set forth on Annex I of the Series A-1 Certificate of
Designation, the value of the “common stock equivalent” of such Series A-1
Preferred as determined in accordance with Section 6(a)(ii) of Annex I of the
Series A-1 Certificate of Designation. Notwithstanding anything to the
contrary set forth under the Series A-1 Certificate of Designation or Series A-2
Certificate of Designation, as applicable, the Deerfield Purchasers acknowledge
and agree that in connection with the enforcement of the Company’s rights under
this Section
2.6(c), the Company shall not be obligated to comply with any
requirements under such documents with respect to the conversion or repurchase
of Shares, as applicable, the Company shall be authorized to complete blank
information (if any) in the Certificate of Conversion (which shall be
automatically effective on the Deerfield Termination Date) and at the request of
the Company, the Deerfield Purchasers shall promptly deliver their Shares and
any other documents reasonably requested by the Company in connection with the
exercise of the Company’s rights under this Section 2.6(c).
Furthermore, in the event of a Deerfield Participation Right Termination Event,
the WP Purchasers shall have the right, but not the obligation, to purchase up
to the number of Shares the Deerfield Purchasers would have purchased at such
Closing and any future Closing.
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(d) The
Deerfield Purchasers shall be entitled to allocate the Deerfield Participation
Shares in any manner between them; provided, however,
that (i) for the avoidance of doubt, in no event shall the Deerfield
Participation Shares purchased by the Deerfield Purchasers collectively as a
group in connection with an Additional or Subsequent Issuance be more or less
than the Deerfield Pro Rata Portion of the Series A-1 Additional Investment
Shares, Series A-1 Annex I Additional Investment Shares, Series A-1 Annex I
Subsequent Investment Shares or Series A-2 Subsequent Investment Shares, as the
case may be, to be issued in connection such Additional or Subsequent Issuance,
(ii) notwithstanding the allocation of Deerfield Participation Shares among the
Deerfield Purchasers, the Deerfield Purchasers shall be jointly and severally
liable for the entire Deerfield Participation Purchase Price and all other
obligations of the Deerfield Purchasers hereunder applicable to the exercise of
the Deerfield Participation Right, and (iii) the Deerfield Purchasers shall
notify the Company of the allocation of Deerfield Participation Shares among
Deerfield Purchasers in connection with an exercise of the Deerfield
Participation Right at least three (3) Business Days prior to the Closing of the
applicable Additional or Subsequent Issuance.
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SECTION
3.
|
REPRESENTATIONS AND
WARRANTIES OF THE COMPANY
|
The
following representations and warranties by the Company to the Purchasers are
qualified in their entirety by reference to the disclosure (i) in the Reference
SEC Reports and (ii) set forth in the disclosure letter (the “Company Disclosure
Letter”) delivered by the Company to each Purchaser concurrently with the
execution of this Agreement. Each disclosure set forth in the Company
Disclosure Letter shall identify items of disclosure by reference to a
particular Section or Subsection of this Agreement; provided, however, that any
disclosure contained in any section of the Company Disclosure Letter shall
qualify or modify each of the representations and warranties set forth in this
Section 3 to the extent the applicability of the disclosure to such other
section is reasonably apparent from the text of the disclosure made.
Subject to the foregoing, the Company hereby represents and warrants to the
Purchasers that as of the date hereof and each Closing Date (except to the
extent made only as of a specified date, in which case as of such
date):
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3.1.
|
Corporate
Organization
|
(a) The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware. The Purchasers have been provided
true and complete copies of the Amended and Restated Certificate of
Incorporation of the Company and Amended and Restated Bylaws of the Company, in
each case as in effect immediately prior to the First Closing.
(b) The
Company has all requisite power and authority to own its properties and to carry
on its business as now conducted. The Company has all requisite power and
authority to execute and deliver this Agreement and the Transaction Documents
and to perform its obligations hereunder and thereunder.
(c) The
Company has filed all necessary documents to qualify to do business as a foreign
corporation in, and the Company is in good standing under, the laws of each
jurisdiction in which the conduct of the Company’s business or the nature of the
property owned requires such qualification, except where the failure to so
qualify would not have, or would not reasonably be expected to have, a Material
Adverse Effect.
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3.2.
|
No
Subsidiaries
|
The
Company does not own any stock of, or any equity participation in, any
Person. There are no Subsidiaries of the Company.
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3.3.
|
Capitalization
|
(a) On
the date hereof, the authorized capital stock of the Company consists of
200,000,000 shares of its Common Stock and 10,000,000 shares of preferred stock,
par value $0.001 per share (the “Authorized Preferred
Stock”), 1,100,000 and 400,000 of which have been designated as Series
A-1 Preferred or Series A-2 Preferred, respectively, in accordance with the
terms of the Transaction Documents. As of the close of business on the
Business Day prior to the date of this Agreement, (i) 84,844,815 shares of
Common Stock were issued and outstanding and there were no shares of Common
Stock held in the treasury of the Company, (ii) no shares of Authorized
Preferred Stock were issued and outstanding, (iii) warrants to purchase up to
8,794,374 shares of Common Stock were issued and outstanding, as described in
the Company SEC Reports filed prior to May 31, 2010 and (iv) 13,062,227 shares
of Common Stock were reserved for issuance pursuant to the Company’s option
plans and equity incentive programs as described in the Company SEC Reports
filed prior to May 31, 2010. Since the Business Day prior to the date of
this Agreement until the First Closing, except in connection with the
transactions contemplated by the Transaction Documents, the Company has not (x)
issued or authorized the issuance of any shares of Common Stock or Authorized
Preferred Stock, or any securities convertible into or exchangeable or
exercisable for shares of Common Stock or Authorized Preferred Stock, (y)
reserved for issuance any shares of Common Stock or Authorized Preferred Stock
or (z) repurchased or redeemed, or authorized the repurchase or redemption of,
any shares of Common Stock or Authorized Preferred Stock. On a pro forma
basis, as of the First Closing (assuming that the First Tranche Shares have been
issued as set forth on Schedule 2.1 hereto
and that no options have been exercised since the close of business on the
Business Day prior to the date of this Agreement), (1) 84,844,815 shares of
Common Stock will be issued and outstanding and none of which shares will be
held in the treasury of the Company, (2) 400,000 shares of Series A-1 Preferred
will be issued and outstanding, (3) 90,000,000 shares of Common Stock will be
reserved for issuance pursuant to conversion of the Series A-1 Preferred, (5)
warrants to purchase up to 8,794,374 shares of Common Stock will be issued and
outstanding, as described in the Company SEC Reports filed prior to May 31,
2010, (6) 13,062,227 shares of Common Stock will be reserved for issuance
pursuant to the Company’s option plans and equity incentive programs, as
described in the Company SEC Reports filed prior to May 31, 2010 and (7) except
as set forth in the foregoing clauses (2) and (3), no shares of Authorized
Preferred Stock will be issued and outstanding. No bonds, debentures,
notes or other indebtedness having the right to vote on any matters on which the
stockholders of the Company may vote are issued and outstanding.
(b) All
of the outstanding shares of capital stock of the Company have been duly and
validly issued and are fully paid and non-assessable, and were issued in
accordance with the registration or qualification requirements of the Securities
Act and any relevant state securities laws or pursuant to valid exemptions
therefrom. Upon issuance, sale and delivery as contemplated by this
Agreement, (i) each of the Shares and (ii) subject to the satisfaction of the
Series A-1 Conversion Conditions, upon conversion of the Series A Preferred to
Common Stock in accordance with the terms of the applicable Certificate of
Designation, each of the Conversion Shares, will, in each case, be duly
authorized, validly issued, fully paid and non-assessable, and free and clear of
any and all security interests, pledges, liens, charges, claims, options,
restrictions on transfer, preemptive or similar rights, proxies and voting or
other agreements, or other encumbrances of any nature whatsoever, except for
those provided for herein or in the Transaction Documents and other than
restrictions on transfer imposed by federal or state securities
laws.
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(c) Except
for the Series A-1 Preferred, warrants to purchase up to 8,794,374 shares of
Common Stock, as described in the Company SEC Reports filed prior to May 31,
2010, and the conversion rights which attach to the 13,062,227 shares of Common
Stock reserved for issuance pursuant to the Company’s option plans and equity
incentive programs as described in the Company SEC Reports filed prior to May
31, 2010, on the Closing Date, there will be no shares of Common Stock or any
other equity security of the Company issuable upon conversion, exchange or
exercise of any security of the Company or any of its Subsidiaries nor will
there be any rights, options, calls or warrants outstanding or other agreements
to acquire shares of Common Stock or any other equity securities of the Company
nor will the Company be contractually obligated to purchase, redeem or otherwise
acquire any of its outstanding shares. Except as contemplated by this
Agreement, (i) no stockholder of the Company is entitled to any preemptive or
similar rights to subscribe for shares of capital stock of the Company, (ii) no
stockholder of the Company has any rights, contractual or otherwise, to
designate members of the Board, other than in accordance with the DGCL, and
(iii) there are no stockholder, voting or other agreements relating to the
rights and obligations of the Company’s stockholders.
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3.4.
|
Authorization
|
The
Company has the requisite corporate power and authority to (a) execute, deliver
and perform its obligations under this Agreement and the Transaction Documents
and (b) subject to (i) the Stockholder Approval with respect to the issuance and
delivery of the Conversion Shares and (ii) the satisfaction of the Series A-1
Conversion Conditions with respect to the issuance and delivery of Series A-1
Conversion Shares, to consummate each of the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement and the
Transaction Documents by the Company and the performance by the Company of its
obligations hereunder and thereunder and the consummation of the transactions
contemplated hereby and thereby have been duly authorized by the Board. No
other corporate or stockholder action is necessary to authorize such execution,
delivery and, other than (i) the Stockholder Approval with respect to the
issuance and delivery of the Conversion Shares and (ii) satisfaction of the
Series A-1 Conversion Conditions with respect to the issuance and delivery of
Series A-1 Conversion Shares, performance of this Agreement and the Transaction
Documents. Upon execution and delivery, this Agreement and the Transaction
Documents shall constitute the valid and binding obligation of the Company,
enforceable against the Company in accordance with their respective terms,
except that such enforcement may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors’ rights and general principles of equity. The
Company has authorized the issuance and delivery of the Shares, the shares of
Common Stock issuable upon conversion of the Series A-1 Preferred in accordance
with this Agreement and no further corporate or stockholder action is required
in connection with such issuance and delivery. The only corporate or
stockholder action required to authorize the issuance and delivery of the
Conversion Shares (other than the shares of Common Stock issuable on conversion
of the First Tranche Shares, which are already authorized, but remain subject to
the satisfaction of the Series A-1 Conversion Conditions) is the Stockholder
Approval. Subject to the Stockholder Approval, the Company has authorized
the issuance and delivery of the Conversion Shares. The only corporate or
stockholder action required to authorize the issuance and delivery of Series A-1
Conversion Shares is the satisfaction of the Series A-1 Conversion
Conditions. Subject to the satisfaction of the Series A-1 Conversion
Conditions, the Company has authorized the issuance and delivery of the Series
A-1 Conversion Shares.
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3.5.
|
No
Conflicts
|
The
execution, delivery and performance by the Company of this Agreement and the
Transaction Documents, and the consummation of the transactions contemplated
hereby and thereby, including the issuance of the Securities, do not, and will
not, (a) conflict with, or result in a violation of, any provision of any
law, ordinance, permit, concession, grant, franchise, statute, rule or
regulation or any judgment, ruling, order, writ, injunction or decree applicable
to the Company or any of its Subsidiaries or any of their respective properties
or assets, (b) conflict with or result in a violation of any provision of
the Organizational Documents or the comparable organizational documents of any
of its Subsidiaries or (c) conflict with, result in a violation or breach
of, constitute (with or without due notice or lapse of time or both) a default
(or give rise to any right of termination, cancellation or acceleration) under,
or result in the creation of, any Lien on any property or asset of the Company
or its Subsidiaries or in any obligation by the Company or its Subsidiaries to
purchase or redeem, or offer to purchase or redeem, any capital stock or other
securities of the Company or its Subsidiaries, under any Contract to which the
Company or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries or any of their respective properties may be bound; except, in
each of the cases of clauses (a) or (c) where any such conflict, violation or
breach would not reasonably be expected to, individually or in the aggregate,
have a Material Adverse Effect. There are no material
consents, waivers and approvals under any Contracts required to be obtained by
the Company or any of its Subsidiaries in connection with the Company’s entering
into this Agreement or any of the Transaction Documents or the consummation of
the transactions contemplated hereby or thereby.
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3.6.
|
Approvals
|
The
execution and delivery by the Company of this Agreement and the Transaction
Documents do not, and the performance of its obligations hereunder and
thereunder and the consummation of the transactions contemplated hereby and
thereby by the Company will not, require any consent, approval, authorization or
permit of, or registration or filing with or notification to, any Governmental
Authority, except (a) the filing of the Proxy Statement with the SEC, (b) the
filing of Current Reports on Form 8-K as required by the Exchange Act, (c) the
filing of a Form D under Regulation D under the Securities Act and any filings
required under state securities laws, (f) the notification requirements of the
HSR Act (to the extent applicable) and (g) any such consent, approval,
authorization, registration, filing or notification for which the failure to
obtain or make would not reasonably be expected to have a Material Adverse
Effect.
- 16
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|
3.7.
|
Reports and Financial
Statements
|
(a) The
Company has filed with the SEC all forms, registration statements, reports,
schedules and statements and other documents (including exhibits thereto)
required to be filed by it under the Exchange Act and Securities Act, including
pursuant to Section 13(a) or 15(d) of the Exchange Act, since December 31, 2007
(such forms, reports, schedules, statements and other documents, in each case,
as amended, supplemented or superseded, being hereinafter referred to as the
“Company SEC
Reports”), and paid any fees required thereby, on a timely basis or has
received a valid extension of such time of filing and has filed such Company SEC
Reports prior to the expiration of any such extension. Each Company SEC
Report, including the documents incorporated by reference in each of them, at
the time filed (i) contained, in all material respects, all information required
to be included in it, (ii) did not contain any untrue statement of a
material fact or omit to state a 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 and (iii) complied in all
material respects with all applicable requirements of the Exchange Act and
Securities Act. No executive officer of the Company has failed in any
respect to make the certifications required of him or her under Section 302 or
906 of the Xxxxxxxx-Xxxxx Act. As of the date hereof, none of the Company
SEC Reports, nor any registration statement filed under the Securities Act, is
the subject of any ongoing SEC review, outstanding SEC comment or outstanding
SEC investigation.
(b) The
audited consolidated financial statements and unaudited interim financial
statements of the Company included in the Company SEC Reports (i) have been
prepared from, and are in accordance with, the books and records of the Company
and its Subsidiaries, (ii) complied as to form in all material respects with
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto, (iii) have been prepared in accordance with
generally accepted accounting principles in the United States of America (“GAAP”) applied on a
consistent basis during the periods involved (except as may be indicated in the
notes thereto or, in the case of unaudited interim financial statements, for
normal year-end adjustments that are not material in amount or scope to the
extent permitted by the SEC on Form 10-Q, Form 8-K or any like form under the
Exchange Act), and (iv) present fairly, in all material respects, the financial
position of the Company and its Subsidiaries as at the dates thereof and the
results of their operations and cash flow for the periods then ended subject, in
the case of the unaudited interim financial statements, to normal year-end audit
adjustments.
(c) The
records, systems, controls, data and information of the Company are recorded,
stored, maintained and operated under means (including any electronic,
mechanical or photographic process, whether computerized or not) that are under
the exclusive ownership and direct control of the Company or its Subsidiaries or
accountants (including all means of access thereto and therefrom), except for
any nonexclusive ownership and nondirect control that would not, individually or
in the aggregate, reasonably be expected to have a material adverse effect on
the system of internal accounting controls described below in Section
3.7(d).
- 17
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(d) The
Company has implemented and maintains disclosure controls and procedures (as
defined in Rule 13a-15(e) of the Exchange Act) that ensure that information
required to be disclosed by the Company in the reports that it files or submits
under the Exchange Act is accumulated and communicated to the Company’s
management, including its principal executive and principal financial officers,
or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure. The Company maintains internal
control over financial reporting (as defined in Rule 13a-15(f) of the Exchange
Act), which is sufficient to provide reasonable assurances that (a) transactions
are executed in accordance with management’s general or specific authorization;
(b) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and
maintain accountability for assets; and (c) access to assets is permitted only
in accordance with management’s general or specific authorization. The
Company’s internal control over financial reporting is effective and the Company
is not aware of any material weakness in its internal control over financial
reporting. Since December 31, 2009, there has been no change in the
Company’s internal control over financial reporting or disclosure controls and
procedures or, to the knowledge of the Company, in other factors that could
significantly affect the Company’s internal controls.
(e) The
Company has disclosed, based on its most recent evaluation prior to the date of
this Agreement, to the Company’s outside auditors and the audit committee of the
Board (x) any significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting that are reasonably
likely to adversely affect the Company’s ability to record, process, summarize
and report financial information, and (y) any fraud, whether or not material,
that involves management or other employees who have a significant role in the
Company’s internal controls over financial reporting. As of the date of
this Agreement, the Company has no knowledge of any reason that its outside
auditors and its principal executive officer and principal financial officer
will not be able to give the certifications and attestations required pursuant
to the rules and regulations adopted pursuant to Section 404 of the
Xxxxxxxx-Xxxxx Act, without qualification, when next due. Since December
31, 2007, (i) neither the Company nor any of its Subsidiaries nor, to the
knowledge of the Company, any director, officer, employee, auditor, accountant
or representative of the Company or any of its Subsidiaries has received or
otherwise had or obtained knowledge of any material complaint, allegation,
assertion or claim, whether written or oral, regarding the accounting or
auditing practices, procedures, methodologies or methods of the Company or any
of its Subsidiaries or their respective internal accounting controls, including
any material complaint, allegation, assertion or claim that the Company has
engaged in questionable accounting or auditing practices, and (ii) no attorney
representing the Company or any of its Subsidiaries, whether or not employed by
the Company or any of its Subsidiaries, has reported evidence of a material
violation of securities laws, breach of fiduciary duty or similar violation by
the Company or any of its officers, directors, employees or agents to the Board
or any committee thereof or to any director or officer of the
Company.
- 18
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3.8.
|
Absence of Certain
Developments
|
Other
than as disclosed in the Reference SEC Reports, since December 31, 2009, (a) the
Company and each of its Subsidiaries have conducted, in all material respects,
its businesses in the ordinary course, consistent with past practice, (b) there
has not been a Material Adverse Effect, and (c) there has not been (i) any
declaration, setting aside or payment of any dividend or other distribution
(whether in cash, stock or property) with respect to any of the Company’s
outstanding securities or any repurchase or redemption by the Company or its
Subsidiaries of any such securities, (ii) any change in accounting methods,
principles or practices by the Company or any of its Subsidiaries materially
affecting its assets or liabilities, except insofar as may have been required by
law or by a change in applicable GAAP, (iii) any sales, pledges, dispositions,
transfers, leases, exclusive licenses, guarantees or encumbrances of any
material property or assets of the Company or any of its Subsidiaries, (iv) any
material acquisition (including, without limitation, by merger, consolidation,
or acquisition of stock or assets or any other business combination) by the
Company or any of its Subsidiaries of any corporation, partnership, other
business organization or any division thereof, (v) to the knowledge of the
Company, any disclosure of any material trade secrets of the Company or any of
its Subsidiaries, (vi) any incurrence by the Company or any of its Subsidiaries
of indebtedness for borrowed money which, individually or together with all such
other indebtedness, exceeds $1,000,000, (vii) grants of any material security
interest in any material assets of the Company or any of its Subsidiaries,
(viii) any capital expenditure or purchase of fixed assets by the Company or any
of its Subsidiaries other than in the ordinary course of business consistent
with past practice or in accordance with the Company’s capital expenditure
budget as approved by the Board, (ix) any change by the Company or any of its
Subsidiaries of any material election in respect of taxes, any adoption or
change by the Company or any of its Subsidiaries of any material accounting
method in respect of taxes or settlement or compromise by the Company or any of
its Subsidiaries of any material claim, notice, audit report or assessment in
respect of taxes, (x) any pre-payment of any long-term debt or payment,
discharge or satisfaction of any claims, liabilities or obligations (absolute,
accrued, contingent or otherwise) by the Company or any of its Subsidiaries,
except for such payments, discharges or satisfaction of claims as were made or
effected in the ordinary course of business consistent with past practice, (xi)
any write-up, write-down or write-off of the book value of any material assets,
or a material amount of any other assets, of the Company or any of its
Subsidiaries, other than as required by GAAP or (xii) any change in the Board or
the officers of the Company.
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|
3.9.
|
Compliance
|
(a) Neither
the Company nor any of its Subsidiaries is, nor since December 31, 2007 has
been, in violation or default under its Organizational Documents.
(b) Neither
the Company nor any of its Subsidiaries is, nor since December 31, 2007 has
been, in material violation of any laws, ordinances, governmental rules or
regulations to which it is subject, including, without limitation,
laws or regulations relating to the environment or to occupational health and
safety, and no material expenditures are or will be required in order to cause
its current operations or properties to comply with any such law, ordinances,
governmental rules or regulations.
(c) The
Company and its Subsidiaries have, and since December 31, 2007 have had, all
licenses, permits, franchises or other governmental authorizations necessary for
the ownership of their property or for the conduct of their respective
businesses, which if violated or not obtained would reasonably be expected to
have a Material Adverse Effect (the “Material Licenses”);
and all such Material Licenses are in full force and effect and, to the
knowledge of the Company, no material suspension or cancellation of any of them
is threatened, and all such filings, applications and registrations with respect
to the Material Licenses are current. Neither the Company nor any of its
Subsidiaries has finally been denied any application for any such Material
Licenses.
(d) The
Company and each of its officers are, and since December 31, 2007 have been, in
compliance in all material respects with the applicable provisions of the
Xxxxxxxx-Xxxxx Act. Except as permitted by the Exchange Act, including, without limitation,
Sections 13(k)(2) and (3), since the enactment of the Xxxxxxxx-Xxxxx Act,
neither the Company nor any of its Affiliates has made, arranged or modified (in
any material way) personal loans to any executive officer or director of the
Company.
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|
3.10.
|
Litigation
|
There are
no claims, actions, suits, inquiries, judicial or administrative proceedings or
arbitrations pending or, to the knowledge of the Company, threatened against the
Company, any of its Subsidiaries or any of their respective assets by or before
any arbitrator or Governmental Authority, nor are there any reviews or
investigations relating to the Company, any of its Subsidiaries or any of their
respective assets pending, or to the knowledge of the Company, threatened by or
before any arbitrator or Governmental Authority, except in each case as would
not reasonably be expected to have a Material Adverse Effect.
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3.11.
|
Absence of Undisclosed
Liabilities
|
Neither
the Company nor any of its Subsidiaries has any debt, obligation or liability
(whether accrued, absolute, contingent, liquidated or otherwise, whether due or
to become due, whether or not known to the Company) arising out of any
transaction entered into at or prior to the Closing, or any act or omission at
or prior to the Closing, or any state of facts existing at or prior to the
Closing, including taxes with respect to or based upon the transactions or
events occurring at or prior to the Closing, and including, without limitation,
unfunded past service liabilities under any pension, profit sharing or similar
plan, except for (a) liabilities disclosed in the financial statements included
in the Reference SEC Reports, (b) liabilities incurred in the usual and ordinary
course of business consistent with past practice subsequent to March 31, 2010
and (c) liabilities that have not had and would not reasonably be expected to
have a Material Adverse Effect.
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3.12.
|
Change in
Ownership
|
(a) Except
as described on Schedule 3.12,
neither (i) the issuance of the Securities to the Purchasers nor (ii) the
consummation of the transactions contemplated by this Agreement and the
Transaction Documents will result in (A) the acceleration of the vesting of any
outstanding option, warrant, call, commitment, agreement (including employment
agreements), conversion right, preemptive right or other right to subscribe for,
purchase or otherwise acquire any of the shares of the capital stock of the
Company or any of its Subsidiaries, or debt securities, credit agreements or
other debt instruments of the Company or any of its Subsidiaries (collectively
“Commitments”,
and each individually a “Commitment”), (B) any
obligation of the Company to grant, extend or enter into any Commitment, or (C)
any right in favor of any other Person to terminate or cancel any Material
Closing Date Contract.
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3.13.
|
Employment
Matters
|
(a) The
Company and its Subsidiaries are in material compliance with all federal, state,
local and foreign laws and regulations respecting employment and employment
practices, terms and conditions of employment and wages and hours, as
applicable. The Company is not bound by or subject to (and none of its
assets or properties is bound by or subject to) any written or oral, express or
implied, Contract, commitment or arrangement with any labor union, and no labor
union has requested or, to the Company’s knowledge, has sought to represent any
of the employees, representatives or agents of the Company. There is no
strike or other labor dispute involving the Company pending, or to the Company’s
knowledge, threatened nor is the Company aware of any labor organization
activity involving its employees. The Company is not aware that any
officer or key employee, or that any group of officers or key employees, intends
to terminate their employment with the Company, nor does the Company have a
present intention to terminate the employment of any of the
foregoing.
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(b) All material employee benefit plans
covering current or former officers, directors, employees of the Company or its
Subsidiaries or current or former independent contractors or consultants of the
Company or its Subsidiaries, or under which there is a financial obligation of
the Company or any of its Subsidiaries, including, but not limited to, “employee
benefit plans” within the meaning of Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”), whether or not subject to ERISA, and
deferred compensation, stock option, stock purchase, stock appreciation rights,
other stock or stock-based, incentive and bonus, employment, retention,
consulting, change in control, salary continuation, termination or severance
plan, program, policy, practice, arrangement or agreement (the “Company
Benefits Plans”), have been
established and administered in accordance with their respective terms, and in
compliance in all material respects with the applicable provisions of ERISA, the
Code and other applicable laws. All contributions (including all employer
contributions and employee salary reduction contributions) required to have been
made under any of the Company Benefit Plans to any funds or trusts established
thereunder or in connection therewith have been made by the due date
thereof.
(c) Except
for such matters that would not, individually or in the aggregate, be reasonably
expected to have a Material Adverse Effect:
(1) neither
the Company nor any of its Subsidiaries has engaged in a transaction that,
assuming the taxable period of such transaction expired as of the date hereof,
could subject the Company or any of its Subsidiaries to a tax or penalty imposed
by either Section 4975 of the Code or Section 502(i) of ERISA or any other
similar provision of non-U.S. law;
(2) neither
the Company nor any of its Subsidiaries has or is expected to incur any
liability under Title IV of ERISA with respect to any “single-employer plan”,
within the meaning of Section 4001(a)(15) of ERISA, any Multiemployer Plan or
any “multiple employer plan”, within the meaning of Section 4063/4064 of ERISA
or Section 413(c) of the Code, in each case currently or formerly maintained or
contributed to by any of them or any other entity which is considered one
employer with the Company under Section 4001 of ERISA or Section 414 of the Code
(an “ERISA
Affiliate”); and
(3) none
of the Company, its Subsidiaries or any ERISA Affiliate have any unsatisfied
withdrawal liability with respect to a Multiemployer Plan under Subtitle E
of Title IV of ERISA.
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|
3.14.
|
Tax
Matters
|
(a) All
material tax returns required to be filed by, or with respect to, the Company or
any of its Subsidiaries have been timely filed (taking into account extensions)
and are correct and complete in all material respects. The Company and
each of its Subsidiaries has timely paid all taxes due and payable by it or for
which it may be liable (other than taxes that are being contested in good faith
and for which adequate reserves are reflected in accordance with GAAP).
The Company and each of its Subsidiaries has made adequate provision in
accordance with GAAP on the Company’s consolidated balance sheet filed with the
most recent Company SEC Reports for all taxes payable for which no tax return
has yet been filed.
(b) Since
December 31, 2007, none of the Company or any of its Subsidiaries has incurred
any liability for material taxes outside the ordinary course of business
consistent with past practice.
(c) No
examination or audit of any tax return relating to any material taxes of the
Company or its Subsidiaries or with respect to any material taxes due from or
with respect to the Company or its Subsidiaries by the Internal Revenue Service
or the appropriate state, local or foreign taxing authority is currently in
progress, and no assessment of material tax has been proposed in writing against
the Company or its Subsidiaries or any of their assets or
properties.
(d) Neither
the Company nor any of its Subsidiaries has any current material liability for
taxes of any person (other than the Company and its Subsidiaries) (A) under
Treasury Regulations Section 1.1502-6 (or any similar provision of state, local
or foreign law), (B) as a transferee or successor or (C) by
Contract.
(e) None
of the Company or any of its Subsidiaries is a party to, is bound by or has any
obligation under any tax sharing or tax indemnity contract or similar
arrangement.
(f)
Neither the Company
nor any of its Subsidiaries has been a party to a “reportable transaction”, as
such term is defined in Treasury Regulations Section 1.6011-4(b)(1) or to a
transaction that is or is substantially similar to a “listed transaction”, as
such term is defined in Treasury Regulations Section
1.6011-4(b)(2).
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|
3.15.
|
Contracts
|
(a) Except
for such Contracts as are listed on Schedule 3.15(a) or
are filed or referenced as exhibits to (x) the Company’s Annual Report on Form
10-K filed with the SEC on March 25, 2010 and (y) any Reference SEC Reports
(collectively, the “Material Signing Date
Contracts”), neither the Company nor any of its Subsidiaries is a party
to or bound as of the date of this Agreement by any:
(i)
mortgage, indenture,
note, or installment obligation, or other instrument for or relating to any
material amount of indebtedness;
(ii) Contract
pursuant to which it is or may be obligated to make payments in excess of
$75,000 individually or $150,000 in the aggregate, contingent or otherwise, on
account of or arising out of prior acquisitions or sales of businesses, assets,
or stock of other companies;
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(iii) Contract
imposing non-competition or exclusive dealing obligations on the
Company;
(iv)
Contract providing for payments to or by any other Person based on sales,
purchases, or profits in excess of $75,000 individually or $150,000 in the
aggregate, other than direct payments for goods;
(v) Contract
providing for any milestone or similar payments;
(vi) Contract
or agreement for the employment of any shareholder, director, officer,
consultant or employee not terminable without penalty or liability arising from
such termination or containing any severance, or change of control provisions or
any analogous Contract or arrangement;
(vii) Contract
relating to cleanup, abatement or other actions in connection with any
environmental liability under any Environmental Laws;
(viii) collective
bargaining agreement or other Contract to or with any labor union or other
representative of a group of employees;
(ix) Contract
which contains restrictions with respect to payment of dividends or any other
distribution in respect of the capital stock or other equity interests of the
Company or any of its Subsidiaries;
(x)
Contract relating to capital expenditures or other purchases of material,
supplies, equipment (including all Contracts to purchase containers, trailers or
portable offices) or other assets or properties in excess of $75,000
individually, or $150,000 per counterparty in any year;
(xi) Contract
involving a loan (other than accounts receivable from trade debtors in the
ordinary course of business) or advance to (other than expense allowances to the
employees of the Company extended in the ordinary course of business), or
investment in, any Person or any Contract relating to the making of any such
loan, advance or investment;
(xii) Contract
granting or evidencing a Lien on any properties or assets of the Company or any
of its Subsidiaries;
(xiii) management
service, consulting, financial advisory or any other similar type Contract, in
each case obligating the Company to pay in excess of $75,000 in any consecutive
12-month period, or any Contract with any investment or commercial bank (other
than standard deposit account Contracts);
(xiv) Contract
(other than this Agreement and any agreement or instrument entered into pursuant
to this Agreement) with (A) any Affiliate of the Company or (B) any current or
former officer or director of the Company or any Subsidiary of the
Company;
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(xv) Contract
involving the present or future disposition or acquisition of material assets or
properties, or any merger, consolidation or similar business combination
transaction;
(xvi) Contract
providing any Person with the right of first refusal or first offer or similar
type provision with respect to the disposition or acquisition of any assets
other than sales of non-material assets in the ordinary course of
business;
(xvii) Contract
involving any material joint venture, partnership, strategic alliance,
shareholders’ agreement, co-marketing, co-promotion, co-packaging, joint
development or similar arrangement;
(xviii) Contract
involving any material resolution or settlement of any actual or threatened
litigation, arbitration, claim or other dispute;
(xix) Contract
involving an obligation of standstill on the part of the Company or similar
agreement or arrangement in connection with a potential merger or material
acquisition or disposition of a business;
(xx) lease
to which the Company or any Subsidiary of the Company is a party (as lessee or
lessor) and involving a quarterly base rental payment in excess of $10,000 per
lease;
(xxi) Contract
material to the Company’s business which provides for termination, acceleration
or other similar rights or any other consideration of any kind with respect to
any direct or indirect change of control of the Company or any Subsidiary of the
Company;
(xxii) Contract
which provides for termination, acceleration or other similar material rights or
any other material consideration of any kind with respect to any direct or
indirect change of control of the Company or any Subsidiary of the
Company;
(xxiii) Contract
entered into outside the ordinary course of business and pursuant to which the
Company or any Subsidiary of the Company is obligated to indemnify any
Person;
(xxiv) material
Contract relating to Company Intellectual Property;
(xxv) “material
contract” (as such term is defined in Item 601(b)(10) of Regulation S-K of the
SEC); or
(xxvi) Contract
not listed above that is otherwise material to the business of the Company and
the Subsidiaries of the Company taken as a whole.
- 24
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(b) (i)
As of the date of this Agreement: (x) each Material Signing Date Contract is
valid, binding and enforceable against the Company or a Subsidiary of the
Company, as applicable, and to the Company’s knowledge, the other parties
thereto in accordance with its terms, and is in full force and effect; (y) the
Company or a Subsidiary of the Company, as applicable, has performed all
material obligations required to be performed by it to date under each Material
Signing Date Contract; and (z) neither the Company nor any Company Subsidiary,
as applicable, nor, to the knowledge of the Company, any other party thereto, is
in material breach of or default under any Material Signing Date Contract, and
to the knowledge of the Company, no event has occurred which, with due notice or
lapse of time or both, would reasonably be expected to constitute such a
breach. (ii) As of each Closing Date: (x) each Contract in
existence as of such Closing Date of a type described in Sections 3.15(a)(i) - (xxvi)
(the “Material Closing
Date Contracts”) is valid, binding and enforceable against the Company or
a Subsidiary of the Company, as applicable, and to the knowledge of the Company,
the other parties thereto in accordance with its terms, and is in full force and
effect; (y) the Company or a Subsidiary of the Company, as applicable, has
performed all material obligations required to be performed by it on or prior to
the applicable Closing Date under each Material Closing Date Contract; and (z)
neither the Company nor any Subsidiary of the Company, as applicable, nor, to
the knowledge of the Company, any other party thereto, is in material breach of
or default under any Material Closing Date Contract, and to the knowledge of the
Company, no event has occurred which, with due notice or lapse of time or both,
would reasonably be expected to constitute such a breach.
(c) The
Company has delivered or otherwise made available to the Purchasers a true and
correct copy of each Material Signing Date Contract.
(d) The
Company has delivered or otherwise made available to the Purchasers a true and
correct list of all milestone or similar payments owed by the Company as of the
date hereof under any Contract, including the amount of such payments, the
events triggering such payments and the Company’s good faith estimate as to the
timing of such payments.
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|
3.16.
|
Intellectual
Property
|
(a) Schedule 3.16 of the
Company Disclosure Letter sets forth a complete and correct list of all
registrations and applications for registration of any Intellectual Property
owned by the Company or any of its Subsidiaries as of the date hereof, all of
which are valid, enforceable and in full force and effect.
(b) (i)
The Company and its Subsidiaries own solely and exclusively or have the right to
use pursuant to a valid license, all of the Intellectual Property owned, used or
held for use in the business of the Company or any of its Subsidiaries (“Company Intellectual
Property”), (ii) the Company Intellectual Property is all of the
Intellectual Property necessary for the conduct of the respective businesses of
the Company and its Subsidiaries as currently conducted, (iii) the Company and
its Subsidiaries have taken all measures reasonably necessary to preserve,
maintain and protect the Company Intellectual Property, (iv) the execution and
delivery of this Agreement and the consummation of the transactions contemplated
by this Agreement will not alter, encumber, impair or extinguish any Company
Intellectual Property, (v) to the Company’s knowledge, none of the Company’s or
its Subsidiaries’ material trade secrets have been disclosed to any Person, and
(vi) the Company will not be, as a result of the execution and delivery of this
Agreement or any Transaction Document, or the performance of the Company’s
obligations under this Agreement or any Transaction Document, in breach of any
license, sublicense or other agreement relating to any Company Intellectual
Property and, to the knowledge of the Company, no event has occurred which, with
due notice or lapse of time or both, would reasonably be expected to constitute
such a breach.
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(c) Neither
the Company Intellectual Property nor the conduct of the business of the Company
or any of its Subsidiaries has interfered with, infringed upon, misappropriated
or otherwise violated, or is interfering with, infringing upon, misappropriating
or otherwise violating, any Intellectual Property rights of third parties in any
material respect, and, to the knowledge of the Company, no third party has
interfered with, infringed upon, misappropriated or otherwise violated, or is
interfering with, infringing upon, misappropriating or otherwise violating in
any material respect, any Company Intellectual Property owned by the Company or
any of its Subsidiaries.
(d) The
Company has not been named, and to the knowledge of the Company is not
threatened to be named, in any suit, action or proceeding which involves a claim
of infringement, violation, misrepresentation, misappropriation or misuse of any
Intellectual Property right of any third party.
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|
3.17.
|
Insurance
|
The
Company and its Subsidiaries and their respective properties are insured in such
amounts, against such losses and with such insurers as are consistent with what
would reasonably be expected in light of the nature of the properties and
businesses of the Company and its Subsidiaries. A copy of the Company’s
director and officer liability insurance policy has been provided or otherwise
made available to the Purchasers. Such policy is in full force and effect,
the Company is current in the payment of all fees related thereto, the Company
has not received any notice of cancellation in connection therewith and, to the
knowledge of the Company, no action has been taken that would result
in the cancellation or termination of such policy.
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|
3.18.
|
Environmental
Liability
|
Except
for matters that, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect, (i) the Company and each of its
Subsidiaries are and have been in compliance with all applicable Environmental
Laws and have obtained or applied for all Environmental Permits necessary for
their operations as currently conducted; (ii) there have been no Releases of any
Hazardous Materials that could be reasonably likely to form the basis of any
Environmental Claim against the Company or any of its Subsidiaries; (iii) there
are no Environmental Claims pending or, to the knowledge of the Company,
threatened against the Company or any of its Subsidiaries; (iv) neither the
Company nor any of its Subsidiaries is subject to any agreement, order,
judgment, decree, letter or memorandum by or with any Governmental Authority or
third party imposing any liability or obligation under any Environmental Law;
and (v) neither the Company nor any of its Subsidiaries has retained or assumed,
either contractually or by operation of law, any liability or obligation that
could reasonably be expected to form the basis of any Environmental Claim
against the Company or any of its Subsidiaries.
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|
3.19.
|
Transactions with
Related Parties
|
Except
for the Deerfield Loan Agreement, the amendment thereto contemplated hereby,
this Agreement and the Transaction Documents, as of the date hereof, there are
no transactions, or series of related transactions, agreements, arrangements or
understandings, nor are there any currently proposed material transactions, or
series of related transactions, between the Company or any of its Subsidiaries,
on the one hand, and the Company, a Subsidiary of the Company, any current or
former director, officer, partner, employee or Affiliate of the Company or any
of its Subsidiaries, on the other hand, that would be required to be disclosed
under Item 404 of Regulation S-K promulgated under the Securities
Act.
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|
3.20.
|
Property
|
The
Company and each of its Subsidiaries has good and marketable fee simple title to
or valid leasehold interests in all of the real property owned or leased by the
Company or such Subsidiary and good title to all of their personal property,
except where the failure to hold such title or leasehold interests, individually
or in the aggregate, is not reasonably expected to have a Material Adverse
Effect. The Company and its Subsidiaries enjoy peaceful and undisturbed
possession under all of their respective leases except where the failure to
enjoy such peaceful and undisturbed possession, individually or in the
aggregate, is not reasonably expected to have a Material Adverse
Effect.
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|
3.21.
|
Indebtedness
|
Other
than any Indebtedness outstanding under that certain Facility Agreement, dated
October 30, 2007, between the Company and Deerfield Private Design Fund, L.P.,
Deerfield Special Situations Fund, L.P., Deerfield Special Situations Fund
International Limited, and Deerfield Private Design International, L.P. (the
“Deerfield Loan
Agreement”), neither the Company nor any of its Subsidiaries has any
outstanding material Indebtedness. The Company has provided to the
Purchasers a true, complete and accurate copy of the Deerfield Loan Agreement
and all related documents and as of the date hereof, neither the Deerfield Loan
Agreement nor any related document has been amended, modified or waived in any
manner. The aggregate amount outstanding as of the date hereof under the
Deerfield Loan Agreement is set forth on Schedule 3.21.
The Company is in compliance in all material respects with the Deerfield Loan
Agreement and the transactions contemplated hereby and in the Transaction
Documents do not and will not require any consent under the Deerfield Loan
Agreement or result in any right of termination or acceleration (upon notice,
after the passage of time or otherwise) thereunder.
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|
3.22.
|
Accuracy of
Information
|
All
factual information furnished by or on behalf of the Company and its
Subsidiaries in writing to the Purchasers on or prior to the date of this
Agreement, for purposes of this Agreement and all other such factual information
furnished by the Company on behalf of itself and its Subsidiaries in writing to
the Purchasers pursuant to the terms of this Agreement was and will be, true and
accurate in all material respects on the date as of which such information is
dated or furnished and not incomplete by knowingly omitting to state any
material fact necessary to make such information not misleading at such time,
provided,
however, that with respect to any projected financial information or
forward-looking statements, business assumptions, strategic plans or similar
information, the Company represents only that such information was prepared in
good faith based upon assumptions, and subject to such qualifications, believed
to be reasonable at the time. The Company makes no representation in this Section 3.22 with
respect to any information to the extent prepared by third parties, provided, however,
that nothing has come to the attention of the Company that has caused the
Company to believe that such information is not based on or derived from sources
that are reliable and accurate in all material respects.
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|
3.23.
|
Registration Rights;
Voting Rights
|
Except as
required by the Registration Rights Agreement, (a) the Company will not, as of
the date hereof, be under any obligation to register any of its securities under
the Securities Act, except for any continuing obligations of the Company to
maintain previously filed registration statements, and (b) to the knowledge of
the Company, no shareholder of the Company has entered into any agreement with
respect to the voting of equity securities of the Company.
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|
3.24.
|
Private
Offering
|
Assuming
the accuracy of the representations of the Purchasers set forth in Section 4 of this
Agreement, the offer, issuance and sale of the Securities are and will be exempt
from the registration and prospectus delivery requirements of the Securities
Act, and have been registered or qualified (or are exempt from registration and
qualification) under the registration, permit or qualification requirements of
all applicable state securities laws.
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|
3.25.
|
Investment
Banking
|
Except as
otherwise set forth on Schedule 3.25, there
are no claims for investment banking fees or similar compensation in connection
with the transactions contemplated by this Agreement or the Transaction
Documents based on any arrangement made by or on behalf of the Company.
The Company has provided the Purchasers with a true and correct copy of all
agreements set forth on Schedule 3.25 prior
to the date hereof, each of which has not been amended or modified in any manner
since it was provided to the Purchasers.
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|
3.26.
|
Takeover
Provision
|
The
Company has taken all necessary actions such that the restrictions on business
combinations set forth in Section 203 of the DGCL do not and will not apply to
the Purchasers, this Agreement or the Transaction Documents or to any of the
transactions contemplated hereby or thereby by the approval of the foregoing in
accordance with Section 203(a)(1) of the DGCL. No other Takeover Provision
is applicable to the transactions contemplated hereby. There are (i) no
anti-takeover provision in the Organizational Documents of the Company or other
similar organizational documents of its Subsidiaries, and (ii) no shareholder
rights plan, “poison pill” or similar measures applicable to the
Company.
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|
3.27.
|
Miscellaneous
Securities Law Matters
|
The
Common Stock is registered pursuant to Section 12(g) of the Exchange Act
and the Company has taken no action designed to terminate, or likely to have the
effect of terminating, the registration of the Common Stock under the Exchange
Act, nor has the Company received any notification that the SEC is contemplating
terminating such registration. The Company has not taken and will not
take, and to the knowledge of the Company no Person acting on its behalf has
taken, in violation of applicable law, any action designed to or that might
reasonably be expected to cause or result in unlawful manipulation of the price
of the Common Stock to facilitate the sale or resale of the
Securities.
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|
3.28.
|
Accountants
|
BDO
Xxxxxxx, LLP has advised the Company that they are, and to the best knowledge of
the Company they are, independent accountants as required by the Securities
Act.
|
|
3.29.
|
FDA and Related
Matters
|
(a) In
connection with the Company Products: (i) the Company and its Subsidiaries have
not failed to file with the applicable regulatory authorities (including,
without limitation, FDA or any foreign, federal, state or local governmental or
regulatory authority performing functions similar to those performed by the FDA)
any required filing, declaration, listing, registration, report or submission;
(ii) all such filings, declarations, listings, registrations, reports or
submissions were in material compliance with applicable laws when filed; and
(iii) no deficiencies have been asserted by any applicable regulatory authority
(including, without limitation, the FDA or any foreign, federal, state or local
governmental or regulatory authority performing functions similar to those
performed by the FDA) with respect to any such filings, declarations, listings,
registrations, reports or submissions that remain unresolved.
(b) To
the Company’s knowledge, with regard to the Company Products, all of the
manufacturing facilities and operations of the Company and its United States and
foreign suppliers are in compliance in all material respects with applicable FDA
and comparable regulations, including current Good Manufacturing
Practices.
(c) (i)
Any preclinical tests and clinical trials associated with the Company Products
were and, if still pending, are to the Company’s knowledge being conducted in
all material respects in accordance with protocols filed with the appropriate
regulatory authorities for each such test or trial and in accordance with all
statutes, laws, rules and regulations, as the case may be, and with standard
medical and scientific research procedures; (ii) to the Company’s knowledge, the
descriptions in the Company SEC Reports of the results of the Company’s clinical
studies relating to the Company Products are, as of the dates of such reports,
accurate in all material respects and fairly present the data derived from such
studies; and following the date of the Company SEC Reports containing such
descriptions, except as otherwise disclosed in a subsequent Company SEC Report,
the Company has not become aware of any information that is inconsistent with
such clinical study results or which would otherwise call into question such
clinical study results as described in such Company SEC Report; and (iii)
neither the Company nor its Subsidiaries has received any notices or other
correspondence from the FDA or any committee thereof or from any other U.S. or
foreign government or drug or medical device regulatory agency or review board
requiring or recommending the termination or suspension of any clinical trials
related to the Company Products.
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(d) To
the Company’s knowledge, there are no existing circumstances which would furnish
a basis for an action by FDA or any other Governmental Authority to revoke,
suspend, cancel, modify or withdraw any product approval, clearance, license,
clinical trial, investigation, registration, or other Material License with
respect to any of the Company Products and the Company is not aware of any of
the foregoing having occurred.
(e) Neither
the Company nor its Subsidiaries, nor any employee of the Company or its
Subsidiaries, nor to the knowledge of the Company, any Person retained by the
Company or its Subsidiaries, has made on behalf of the Company or its
Subsidiaries any material false statements or material omissions in any
application or other submission relating to the Company Products to the FDA or
other Governmental Authority.
(f)
The Company and its Subsidiaries have provided or otherwise made available to
Purchasers a copy of all (i) FDA or its foreign equivalent inspection reports,
(ii) notices of adverse findings, (iii) warning, untitled letters, minutes of
meetings or other correspondence from the FDA or other Governmental Authorities
concerning the Company Products in which FDA or such other Governmental
Authority asserted that the operations of the Company or its Subsidiaries may
not be in compliance with applicable laws or that the Company Products may not
be safe, effective, or approvable.
|
SECTION
4.
|
REPRESENTATIONS AND
WARRANTIES OF THE PURCHASERS
|
Each of
the Purchasers represents and warrants, severally and not jointly, to the
Company as of the date hereof and each Closing Date (except to the extent made
only as of specified date, in which case as of such date) as
follows:
(a) It
is acquiring the Securities for its own account for investment and not with a
view towards the resale, transfer or distribution thereof, nor with any present
intention of distributing the Securities but subject, nevertheless, to any
requirement of law that the disposition of such Purchaser’s property shall at
all times be within such Purchaser’s control, and without prejudice to such
Purchaser’s right at all times to sell or otherwise dispose of all or any part
of such securities under a registration under the Securities Act or under an
exemption from said registration available under the Securities
Act.
(b) It
has full power and legal right to execute and deliver this Agreement and the
Transaction Documents to which it is a party and to perform its obligations
hereunder and thereunder.
(c) As
of the date hereof, it is a resident of the jurisdiction set forth immediately
below such Purchaser’s name on the signature pages hereto.
(d) It
has taken all action necessary for the authorization, execution, delivery, and
performance of this Agreement and the Transaction Documents to which it is a
party and its obligations hereunder and thereunder, and, upon execution and
delivery by the Company, this Agreement and the Transaction Documents to which
it is a party shall constitute the valid and binding obligation of such
Purchaser, enforceable against such Purchaser in accordance with their
respective terms, except that such enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors’ rights and general principles of
equity.
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(e) It
has such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of its investment in the Company as
contemplated by this Agreement and the Transaction Documents to which it is a
party, and is able to bear the economic risk of such investment for an
indefinite period of time. It has been furnished access to such
information and documents as it has requested and has been afforded an
opportunity to ask questions of and receive answers from representatives of the
Company concerning the terms and conditions of this Agreement and the
Transaction Documents to which it is a party and the purchase of the Securities
contemplated hereby. It is an “accredited investor” within the meaning of
Rule 501 of Regulation D under the Securities Act.
(f)
Such Purchaser is
not purchasing the Securities as a result of any advertisement, article, notice
or other communication regarding the Securities published in any newspaper,
magazine or similar media or broadcast over television or radio or presented at
any seminar or any other general advertisement.
(g) It
understands that no United States federal or state agency or any other
government or governmental agency has passed upon or made any recommendation or
endorsement of the Securities or an investment therein.
|
SECTION
5.
|
ADDITIONAL AGREEMENTS
OF THE PARTIES
|
|
|
5.1.
|
Transfer
Restrictions
|
(a) Prior
to the applicable Transfer Restriction Outside Date, no member of a Purchaser
Group will, directly or indirectly, Transfer (it being understood that Transfers
of, or other transactions with respect to, ownership interests in the applicable
Purchaser or ownership interests in other members of such Purchaser Group shall
not be considered to be direct or indirect Transfers of the Securities) or the
Series A Preferred (including the Conversion Shares issued upon conversion
thereof) except for Permitted Transfers.
(b) This
Section 5.1
shall automatically terminate and be of no further force or effect on the
earlier of (i) with respect to the Series A-1 Preferred issued on the First
Closing Date, the Stockholder Approval Outside Date if the Company has not
obtained the Stockholder Approval on or prior to such date, (ii) with respect to
the Series A-1 Preferred issued after the First Closing Date, at anytime
following the Stockholder Approval Outside Date if the Company has not obtained
the Stockholder Approval on or prior to such date, (iii) with respect to the
Series A-1 Preferred issued pursuant to this Agreement on or following the First
Closing Date, the date that is the first anniversary of the applicable Closing
Date of such issuance if the Company has obtained the Stockholder Approval on or
prior to the Stockholder Approval Outside Date, (iv) with respect to the Series
A-2 Preferred issued pursuant to this Agreement following the First Closing
Date, the date that is the first anniversary of the applicable Closing Date of
such issuance, (v) the date that is the second anniversary of the First Closing
Date, (vi) the date of consummation of a Buyout Transaction or a Change of
Control, (vii) the date of a material violation by the Company of any term of or
condition set forth herein, where the Company does not cure such violation
within thirty (30) days after written notice of such breach from one or more of
the Purchasers who is actually adversely affected by such breach, (viii) the
date of a material violation by the Company of any term or condition of the
Series A-1 Certificate of Designation or the Series A-2 Certificate of
Designation, where the Company does not cure such violation within thirty (30)
days after written notice of such breach from one or more of the Purchasers who
is actually adversely affected by such breach, (ix) the date following the first
period of twenty (20) consecutive Trading Days during which the Closing Price of
the Common Stock exceeds 200% of the Conversion Price (as defined in the Series
A-1 Certificate of Designation) of the Series A-1 Preferred (with such
Conversion Price being determined at the time of expiration of such 20 Trading
Day period) or (x) an Insolvency Event (such earlier date being referred to as
the “Transfer
Restriction Outside Date”); provided, however, that any
such termination shall not relieve a Purchaser of liability for such Purchaser’s
breach of this Section
5.1 prior to such termination.
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(c) Any
Transfer of the Series A Preferred (including the Conversion Shares issued upon
conversion thereof) in violation of this Section 5.1 shall, to
the fullest extent permitted by law, be null and void ab initio, and the Company
shall not, and shall instruct its transfer agent and other third parties not to,
record or recognize any such purported transaction on the share register of the
Company.
(d) This
Section 5.1 may
be enforced by the Company only at the direction of a majority of the
Independent Directors.
(e) In
connection with any Transfer of Shares by any Deerfield Purchaser, the
transferee thereof (other than any WP Purchaser) shall execute and deliver, and
such Deerfield Purchaser shall cause, as a condition to any such Transfer, such
transferee to execute and deliver, to the Company a certificate of conversion,
substantially in the form of the Certificate of Conversion attached hereto, with
respect to such Shares.
|
|
5.2.
|
Standstill
|
(a) Subject
to the provisions set forth below, without the prior consent of a majority of
the Independent Directors, each Purchaser will not and will cause each member of
its Purchaser Group not to:
(i)
acquire or
agree, offer or propose to acquire, other than as contemplated or permitted in
the Transaction Documents, directly or indirectly, alone or in concert with any
other Person, by purchase or otherwise, any (A) ownership of any of the material
assets or businesses of the Company or any of its Subsidiaries, or any rights or
options to acquire such ownership (including from any third party), or (B)
Beneficial Ownership of any securities of the Company or any of its
Subsidiaries, or any rights or options to acquire such ownership (including from
any third party); provided, however, that the
foregoing shall not apply (x) to any Securities purchased pursuant to the terms
of this Agreement or acquired on the conversion thereof or in exchange therefor,
(y) to any Securities purchased pursuant to Permitted Transfers, including as
between the WP Purchasers and the Deerfield Purchasers pursuant to Section 5.19, or
pursuant to the exercise of rights set forth in Section 5.4, or (z)
any Common Stock purchased in Market Transfers so long as the aggregate amount
of securities purchased in Market Transfers by such Purchaser represents not
more than 5% of the Company’s outstanding shares of Common Stock on a Fully
Diluted Basis;
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(ii) solicit
proxies (as such terms are defined in Rule 14a-1 under the Exchange Act),
whether or not such solicitation is exempt under Rule 14a-2 under the Exchange
Act, with respect to any matter from holders of any shares of stock of the
Company or any securities convertible into or exchangeable for or exercisable
(whether currently or upon the occurrence of any contingency) for the purchase
of such stock;
(iii) initiate,
or intentionally induce any other Person, entity or group (as defined in Section
13(d)(3) of the Exchange Act) to initiate, any shareholder proposal or tender
offer for any securities of the Company or any subsidiary thereof, any Change of
Control of the Company or any of its Subsidiaries or the convening of a
stockholders’ meeting of the Company or any of its Subsidiaries; or
(iv)
enter into any arrangements or understandings with any other Person with respect
to any matter described in the foregoing subparagraphs (i) through
(iii).
(b) The
provisions of Section
5.2(a) shall not apply in respect of any action taken by the WP Purchaser
Designees in their capacity as members of the Board or any proposal by a
Purchaser to the Board in a manner that such Purchaser believes in good faith
does not require public disclosure by the Company. In addition,
notwithstanding the provisions set forth in this Section 5.2, each
member of a Purchaser Group shall be entitled to make any disclosures required
by applicable law.
The
provisions of Section
5.2(a) shall terminate on the earliest of (i) December 7, 2011, (ii) the
date on which any WP Purchaser Designee is not, in either case, elected to the
Board at any annual meeting of the shareholders of the Company (or at any
special meeting held to elect directors in lieu of an annual meeting) and is not
otherwise appointed to the Board, (iii) the date of a Change of Control, (iv)
the date on which the Company waives the provisions of Section 203 of the DGCL
for any Person (other than the Purchasers), (v) the date of a material violation
by the Company of any term of or condition set forth herein, where the Company
does not cure such violation within thirty (30) days after written notice of
such breach from one or more of the Purchasers who is actually adversely
affected by such breach, or (vi) the date immediately following the Stockholder
Approval Outside Date if the Company fails to obtain the Stockholder Approval on
or prior to the Stockholder Approval Outside Date (such earlier date being
referred to herein as the “Standstill Termination
Date”). In addition, the provisions of Section 5.2(a) shall
not apply at any time after (A) the Board resolves to pursue a Buyout
Transaction or a transaction that is contemplated by the Board to result in a
Change of Control or (B) the Board approves, recommends or accepts a Buyout
Transaction or a transaction that would result in a Change of Control proposed
by any Person (other than any Purchaser Group member).
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5.3.
|
Buyout
Transactions
|
So long
as a Purchaser is in compliance with Section 5.1, nothing
set forth in Section
5.1 or Section
5.2 shall prohibit such Purchaser from (i) Transferring Securities
pursuant to the terms of a Buyout Transaction, (ii) voting its Securities with
respect to any Buyout Transaction or (iii) endorsing a Buyout Transaction or any
other transaction that would constitute a Change of Control proposed by any
Person; provided that, in the
case of clause (iii) above, (A) no member of such Purchaser’s Purchaser Group is
an Acquiring Person with respect to any such transaction that constitutes a
Change of Control and (B) no member of such Purchaser’s Purchaser Group is
providing equity or debt financing in connection with such
transaction.
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5.4.
|
Preemptive
Rights
|
(a) Until
the earlier of (i) the fifth anniversary of the date hereof and
(ii)(y) with respect to the WP Purchasers, the date on which the WP
Purchasers’ Purchaser Percentage Interest is less than ten percent (10%), or (z)
with respect to the Deerfield Purchasers, the earliest of (A) the Deerfield
Termination Date, and (B) the date on which the Deerfield Purchasers’ Purchaser
Percentage Interest is less than ten percent (10%), if the Company at any time
or from time to time makes a Qualified Equity Offering, each of the Deerfield
Purchasers and the WP Purchasers shall be afforded the opportunity to acquire
from the Company, for the same price and on the same terms as such securities
are proposed to be offered to others, in the aggregate up to the amount of New
Stock required to enable it to maintain its Purchaser Percentage Interest
determined prior to the Qualified Equity Offering. The WP Purchasers shall
be treated collectively for the purposes of determining the applicable Purchaser
Percentage Interest which they shall be entitled to maintain hereunder and the
Deerfield Purchasers shall be treated collectively for the purposes of
determining the applicable Purchaser Percentage Interest which they shall be
entitled to maintain hereunder.
(b) (i)
In the event the Company intends to make a Qualified Equity Offering that is an
underwritten public offering or a private offering of convertible notes or
convertible preferred stock made to financial institutions for resale pursuant
to Rule 144A, no later than three (3) Business Days after the initial filing of
a registration statement with the SEC with respect to such underwritten public
offering or the commencement of marketing with respect to such Qualified Equity
Offering, it shall give each Purchaser written notice of its intention
(including, in the case of a registered public offering and to the extent
possible, a copy of the prospectus included in the registration statement filed
in respect of such offering) describing, to the extent then known, the
anticipated amount of securities, range of prices, timing and other material
terms of such offering. Each Purchaser shall have three (3) Business Days
from the date of receipt of any such notice to notify the Company in writing
that it intends to exercise such preemptive purchase rights and as to the amount
of New Stock such Purchaser desires to purchase, up to the maximum amount
calculated pursuant to Section 5.4(a) (the
“Designated
Stock”). Such notice shall constitute a non-binding indication of
interest of such Purchaser to purchase the Designated Stock so specified at the
range of prices and other terms set forth in the Company’s notice to it.
The failure of a Purchaser to respond during such three (3) Business Day period
shall, solely with respect to the Purchaser who fails to respond, constitute a
waiver of the preemptive rights only in respect of such
offering.
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(ii) If
the Company proposes to make a Qualified Equity Offering that is not an
underwritten public offering or a private offering of convertible notes or
convertible preferred stock made to financial institutions for resale pursuant
to Rule 144A (a “Private Placement”),
the Company shall give each Purchaser written notice of its intention,
describing, to the extent then known, the anticipated amount of securities,
price and other material terms upon which the Company proposes to offer the
same. Each Purchaser shall have three (3) Business Days from the date of
receipt of the notice required by the immediately preceding sentence to notify
the Company in writing that it intends to exercise such preemptive purchase
rights and as to the amount of Designated Stock such Purchaser desires to
purchase, up to the maximum amount calculated pursuant to Section 5.4(a).
Such notice shall constitute the binding agreement of such Purchaser to purchase
the amount of Designated Stock so specified (or a proportionately lesser amount
if the amount of New Stock to be offered in such Private Placement is
subsequently reduced) upon the price and other terms set forth in the Company’s
notice to it. The failure of a Purchaser to respond during the three (3)
Business Day period referred to in the second preceding sentence shall, solely
with respect to the Purchaser who fails to respond, constitute a waiver of the
preemptive rights in respect of such offering only. As a condition to the
Company’s obligation to provide the notice required in this paragraph, except to
the extent required by applicable law, each Purchaser shall maintain the
confidentiality of the proposed Private Placement until such time as such
Private Placement is publicly announced or otherwise abandoned by the Company,
regardless of whether such Purchaser intends to exercise its preemptive rights
with respect to the Private Placement, provided, however, that in no
event shall this obligation apply to Purchaser for more than thirty (30) days
following the date of delivery to Purchaser of such notice by the
Company.
(c) (i) If
a Purchaser exercises its preemptive purchase rights provided in Section 5.4(b)(ii),
the closing of the purchase of the New Stock with respect to which such right
has been exercised shall be conditioned on the consummation of the Private
Placement giving rise to such preemptive purchase rights and shall take place
simultaneously with the closing of the Private Placement or on such other date
as the Company and such Purchaser shall agree in writing; provided that the
actual amount of Designated Stock to be sold to such Purchaser pursuant to its
exercise of preemptive rights hereunder shall be reduced if the aggregate amount
of New Stock sold in the Private Placement is reduced and, at the option of such
Purchaser (to be exercised by delivery of written notice to the Company within
three (3) Business Days of receipt of notice of such increase), shall be
increased if such aggregate amount of New Stock sold in the Private Placement is
increased. In connection with its purchase of Designated Stock, each
Purchaser shall execute an instrument in form and substance reasonably
satisfactory to the Company containing representations, warranties and
agreements of the Purchaser that are customary for such private placement
transactions.
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(ii) If
a Purchaser exercises its preemptive purchase rights provided in Section 5.4(b)(i),
the Company shall offer such Purchaser, if such underwritten public offering or
Rule 144A offering is consummated, the Designated Stock (as adjusted to reflect
the actual size of such offering when priced) at the same price as the New Stock
is offered to the underwriters or initial purchasers and shall provide written
notice of such price to the Purchaser as soon as practicable prior to such
consummation. Contemporaneously with the execution of any underwriting
agreement or purchase agreement entered into between the Company and the
underwriters or initial purchasers of such underwritten public offering or Rule
144A offering, such Purchaser shall enter into an instrument in form and
substance reasonably satisfactory to the Company acknowledging such Purchaser’s
binding obligation to purchase the Designated Stock to be acquired by it and
containing representations, warranties and agreements of such Purchaser that are
customary in such transactions, and the failure to enter into such an instrument
at or prior to such time shall constitute a waiver of the preemptive rights only
in respect of such offering. Any offers and sales pursuant to this Section 5.4 in the
context of a registered public offering shall also be conditioned on reasonably
acceptable representations and warranties of such Purchaser regarding its status
as the type of offeree to whom a private sale can be made concurrently with a
registered public offering in compliance with applicable securities
laws.
(d) In
the event a Purchaser fails to exercise its preemptive purchase rights provided
in this Section
5.4 within the applicable three (3) Business Day period or, if so
exercised, a Purchaser does not consummate such purchase within the applicable
period, the Company shall thereafter be entitled during the period of 90 days
following the conclusion of the applicable period to sell or enter into an
agreement (pursuant to which the sale of New Stock covered thereby shall be
consummated, if at all, within 60 days from the date of such agreement) to sell
the New Stock not purchased pursuant to this Section 5.4 at the
price and on the terms offered to the Purchasers. In the event the Company
has not sold the New Stock or entered into an agreement to sell the New Stock
within said 90-day period, the Company shall not thereafter offer, issue or sell
such New Stock without first offering such securities to the Purchasers in the
manner provided in this Section
5.4.
(e) The
Purchasers shall not have any rights to participate in the negotiation of the
proposed terms of any Private Placement, underwritten public offering or Rule
144A offering; provided, however, that the
foregoing shall not prevent the WP Purchaser Designees from exercising such
rights in their capacity as members of the Board.
(f)
The Company and each
Purchaser shall cooperate in good faith to facilitate the exercise of the
Purchaser’s preemptive rights hereunder, including securing any required
approvals or consents, in a manner that does not jeopardize the timing,
marketing, pricing or execution of any offering of the Company’s
securities.
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5.5.
|
Reasonable Best
Efforts; Further Assurances
|
Each of
the parties hereto agrees to use its reasonable best efforts to take, or cause
to be taken, all action, and to do, or cause to be done, all things necessary or
desirable under applicable legal requirements, to consummate and make effective
the transactions contemplated by this Agreement and the Transaction
Documents. If at any time after the Execution Date, any further action is
necessary or desirable to carry out the purposes of this Agreement and the
Transaction Documents, the parties hereto shall use their reasonable best
efforts to take or cause to be taken all such necessary or desirable action and
execute, and deliver and file, or cause to be executed, delivered and filed, all
necessary or desirable documentation. Notwithstanding the foregoing,
in no event shall any of the parties hereto be required to amend the terms of
this Agreement or any of the Transaction Documents in order to comply with the
terms of this Section
5.5.
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5.6.
|
Indemnity
|
(a) The
Company agrees to indemnify and hold each WP Purchaser and each member of the WP
Purchaser Group and each of their respective officers, directors, partners,
managers, members, affiliates, employees and agents, and each Person who
controls any of the foregoing (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act) and the officers, directors,
partners, managers, members, affiliates, employees and agents of each such
controlling Person (each an “Indemnified Party”
and collectively the “Indemnified Parties”)
harmless against any and all losses, claims, liabilities, damages and expenses
of any kind or nature whatsoever (“Losses”), including,
without limitation, the reasonable fees and disbursements of counsel and all
other reasonable expenses incurred (and as incurred) in connection with
prosecuting, investigating, defending or preparing to defend any action, suit,
proceeding (including any investigation, litigation or inquiry), demand or cause
of action that may be incurred by them or asserted against or involve any of
them as a result of, arising out of, or in any way related to:
(i)
any inaccuracy in or breach of any of the Company’s
representations and warranties in Section 3 of this
Agreement or in any certificate delivered by the Company pursuant to this
Agreement;
(ii) the
Company’s breach of agreements or covenants made by the Company in this
Agreement or in any certificate delivered by the Company pursuant to this
Agreement; and
(iii) claims
by third parties relating to or arising out of the transactions contemplated by
this Agreement or the Transaction Documents, or any transaction or any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnified Party is or is threatened to be made a party
thereto.
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(b) An
Indemnified Party will give written notice to the Company of any claim with
respect to which it seeks indemnification under this Section 5.6 promptly
after discovery by such Indemnified Party of any matters giving rise to a claim
for indemnification; provided that the
failure of any Indemnified Party to so notify the Company of any such action
shall not relieve the Company from any liability which it may have to such
Indemnified Party unless the Company shall have been materially and adversely
prejudiced by the failure of such Indemnified Party to so notify the
Company. In case any such action shall be brought against any
Indemnified Party and the Indemnified Party has notified the Company of the
commencement thereof, the Company shall be entitled to assume the defense
thereof, with counsel reasonably satisfactory to such Indemnified Party, and
after notice from the Company to such Indemnified Party of its election so to
assume the defense thereof, the Company will not be liable to such Indemnified
Party under this Section 5.6 for any
legal or other expense subsequently incurred by such Indemnified Party in
connection with the defense thereof; provided, however, that (1) if
the Company shall elect not to assume the defense of such claim or action or (2)
if the Indemnified Party reasonably determines (A) that there may be a conflict
between the positions of the Company and of the Indemnified Party in defending
such claim or action or (B) that there may be legal defenses available to such
Indemnified Party different from or in addition to those available to the
Company, then separate counsel for the Indemnified Party shall be entitled to
participate in and conduct the defense, in the case of (1) and (2)(A), or such
different defenses, in the case of (2)(B), and the Company shall be liable for
any reasonable legal or other expenses incurred by the Indemnified Party in
connection with the defense. Notwithstanding the foregoing, in
connection with a claim for indemnification by an Indemnified Party pursuant to
Section
5.6(a)(iii), the Indemnified Party shall be entitled to retain one
separate counsel (and local counsel if necessary) and the Company shall be
liable to such Indemnified Party under this Section 5.6 for any
legal or other expense subsequently incurred by such Indemnified Party in
connection with the defense thereof. The Company agrees that it shall
not, without the Indemnified Party’s prior written consent (which shall not be
unreasonably withheld or delayed), settle or compromise any claim or consent to
entry of any judgment in respect thereof in any threatened or pending action,
suit, claim or proceeding in respect of which indemnification has been sought
hereunder unless such settlement or compromise includes an unconditional release
of such Indemnified Party from all liability arising out of such action, suit,
claim or proceeding.
(c) All
reasonable expenses incurred by an Indemnified Party in connection with any
threatened or pending action, suit, proceeding (including any investigation,
litigation or inquiry), demand or cause of action shall be paid by the Company
in advance of the final disposition of such action, suit, proceeding (including
any investigation, litigation or inquiry), demand or cause of action if so
requested by the Indemnified Party, within twenty (20) days after the receipt by
the Company of a statement or statements from the Indemnified Party requesting
such advance or advances. The Indemnified Party may submit such
statements from time to time. The Indemnified Party’s entitlement to
such expenses shall include those incurred in connection with any proceeding by
the Indemnified Party seeking an adjudication or award in arbitration pursuant
to this Agreement. Such statement or statements shall reasonably
evidence the expenses incurred by the Indemnified Party in connection therewith
and shall include or be accompanied by a written undertaking by or on behalf of
the Indemnified Party to repay such amount if it is ultimately determined that
the Indemnified Party is not entitled to be indemnified against such expenses by
the Company pursuant to this Section
5.6. Each written undertaking to pay amounts advanced must be
an unlimited general obligation but need not be secured, and shall be accepted
without reference to financial ability to make repayment.
(d) The
obligations of the Indemnifying Party under this Section 5.6 shall
survive the consummation of the transactions contemplated by this Agreement or
termination of this Agreement indefinitely.
(e) No
party to this Agreement (or any of its Affiliates) shall, in any event, be
liable or otherwise responsible to any other party (or any of its Affiliates)
for any consequential or punitive damages of such other party (or its
Affiliates) arising out of or relating to this Agreement or the performance or
breach hereof.
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(f) The
indemnification rights contained in this Section 5.6 are not
limited or deemed waived by an investigation or knowledge by any Indemnified
Party prior to or after the date hereof.
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5.7.
|
Consents and
Approvals; Stockholder Approval; HSR
Act
|
(a) Subject
to Sections
5.7(b) and (c), from and after
the date hereof, the Company shall use its best efforts to prepare and file all
necessary documentation, to effect all necessary applications, notices,
petitions, filings and other documents, and to obtain all necessary permits,
consents, orders, approvals and authorizations of, or any exemption by, all
third parties and Governmental Authorities, and expiration or termination of any
applicable waiting periods, necessary or advisable to consummate the
transactions contemplated by this Agreement and the other Transaction Documents,
and to perform the covenants contemplated by this Agreement and the other
Transaction Documents. The Purchasers shall reasonably cooperate with
the Company in all actions contemplated by the previous sentence.
(b) The
Company and each Purchaser shall use reasonable best efforts to obtain or
submit, as the case may be, as promptly as practicable, the approvals and
authorizations of, filings and registrations with, and notifications to
applicable Governmental Authorities, or expiration or termination of any
applicable waiting period, under the HSR Act or competition or merger control
laws of other jurisdictions (collectively, the “Antitrust
Regulations”), for the transactions contemplated by this Agreement and
the other Transaction Documents, to the extent such Antitrust Regulations are
applicable to such Purchaser. In the event the WP Purchasers shall
have provided notice of their election to purchase any Shares hereunder, the
time periods in which such Shares must be purchased shall, at the request of the
WP Purchasers, be extended as necessary (such extension period, the “Antitrust Extension
Period”) to allow the WP Purchasers to comply with any Antitrust
Regulations applicable to such purchase.
(c) (i)
As promptly as practicable after the date hereof and in any event within fifteen
(15) Business Days following the date hereof, the Company shall, in consultation
with the Purchasers, prepare, and the Company shall file with the SEC,
preliminary proxy materials in compliance with Section 14 of the Exchange Act
for the purpose of obtaining the Stockholder Approval (the “Proxy
Statement”). As promptly as practicable after comments, if
any, are received from the SEC thereon and after the furnishing by the Company
and the Purchasers of all information required to be contained therein, the
Company shall, in consultation with the Purchasers, prepare and the Company
shall file any required amendments, if any, with the SEC. The Company
shall notify the Purchasers promptly of the receipt of any comments from the SEC
or its staff and of any request by the SEC or its staff for amendments or
supplements to the Proxy Statement or for additional information and shall
consult with the Purchasers regarding, and supply the Purchasers with copies of,
all correspondence between the Company or any of its representatives, on the one
hand, and the SEC or its staff, on the other hand, with respect to the Proxy
Statement. Prior to filing or mailing any proposed amendment of or
supplement to the Proxy Statement, the Company shall provide the Purchasers a
reasonable opportunity to review and comment on such document. The
Company shall use its best efforts to have the Proxy Statement cleared by the
SEC and shall thereafter mail to the holders of Common Stock as promptly as
possible the Proxy Statement and all other proxy materials for the Stockholder
Meeting.
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(ii) The Company hereby
covenants and agrees that (A) the Proxy Statement will, when filed, comply as to
form in all material respects with the applicable requirements of the Exchange
Act and (B) none of the information included or incorporated by reference in the
Proxy Statement will, at the date it is first mailed to the holders of Common
Stock or at the time of the Stockholder Meeting or at the time of any amendment
or supplement thereof, contain any untrue statement of a material fact or 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
are made, not misleading.
(iii) The Company shall
take, in accordance with applicable law and its Organizational Documents, all
action necessary to convene the Stockholder Meeting as promptly as practicable
to submit for approval by the requisite vote of the stockholders of the Company
the Stockholder Proposals. In connection with each meeting of
stockholders at which the Stockholder Proposals are submitted for a vote of the
stockholders of the Company, (A) the Board shall recommend that its stockholders
vote in favor of the Stockholder Proposals and (B) neither the Board nor any
committee thereof shall withdraw or modify, or propose or resolve to withdraw or
modify, the recommendation of the Board that the stockholders of Common Stock
vote in favor of the Stockholder Proposals. Notwithstanding the
foregoing, at any time prior to obtaining the Stockholder Approval, the Board
may, in response to a material development or change in circumstances occurring
or arising after the date hereof that was neither known to the Board nor
reasonably foreseeable as of or prior to the date hereof (such material
development or change in circumstances, an “Intervening Event”),
withdraw or modify its recommendation with respect to the Stockholder Proposals
(a “Change of Board
Recommendation”) if the Board has determined in good faith, after
receiving the advice of outside legal counsel, that, in light of such
Intervening Event, such action is required to comply with its fiduciary
obligations to the stockholders of the Company under applicable law; provided that prior
to any such withdrawal or modification, (A) the Company shall have given the
Purchasers prompt written notice advising each Purchaser of the decision of the
Board to take such action and the reason for taking such action, (B) the Company
shall have given the Purchasers five (5) Business Days after delivery of each
such notice to propose revisions to the terms of this Agreement (or make another
proposal) and shall have negotiated in good faith with Purchasers with respect
to such proposed revisions or other proposal, if any, and (C) the Board shall
have determined in good faith, after considering the results of such
negotiations and giving effect to the proposals made by the Purchasers, if any,
and after receiving the advice of outside legal counsel that, in light of such
Intervening Event, such withdrawal or modification is required to comply with
its fiduciary obligations to the stockholders of the Company under applicable
laws; provided,
further, that,
in the event the Board does not make the determination referred to in clause (C)
of this paragraph but thereafter determines to withdraw or modify the Board’s
recommendation, the procedures referred to in clauses (A), (B) and (C) above
shall apply anew and shall also apply to any subsequent withdrawal or
modification.
(d) The
Company shall use its reasonable best efforts to solicit from the stockholders
proxies in favor of the Stockholder Proposals and take all other action
necessary or advisable to secure the vote or consent of the stockholders that
are required by applicable law to approve the Stockholder Proposals (including
the Stockholder Approval), including, if necessary or appropriate, adjourning
the Stockholder Meeting to solicit additional
proxies. Notwithstanding anything herein to the contrary, as
permitted by Section 146 of the DGCL, the Company will take all of the actions
contemplated by this Section 5.7
regardless of whether there has been a Change of Board Recommendation, and will
submit the Stockholder Proposals to the stockholders of the Company at such
Stockholder Meeting.
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(e) Each
of the WP Purchasers and the Company will have the right to review in advance,
and to the extent practicable each will consult with the other, in each case
subject to applicable laws relating to the exchange of information, with respect
to all of the information relating to the other party, and any of their
respective Subsidiaries, which appears in any filing made with, or written
materials submitted to, any third party or any Governmental Authorities in
connection with the transactions contemplated by this Agreement and the
Transaction Documents. In exercising the foregoing right, each of the
parties hereto agrees to act reasonably and as promptly as practicable. Each
party hereto agrees to keep the other party apprised of the status of matters
relating to completion of the transactions contemplated hereby. The
WP Purchasers and the Company shall promptly furnish to each other to the extent
permitted by applicable laws with copies of written communications received by
them or their subsidiaries from, or delivered by any of the foregoing to, any
Governmental Authorities in respect of the transactions contemplated by this
Agreement or by any other Transaction Document.
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5.8.
|
Use of Proceeds;
Prohibition on Certain
Actions
|
(a) The
proceeds received by the Company from the issuance and sale of the Securities
shall be used by the Company for general corporate purposes.
(b) While
the Purchaser Percentage Interests of the WP Purchasers is at least ten percent
(10%), unless the prior written consent of the WP Purchasers is first
obtained,
(i) in
no event shall the Company prepay or refinance any Indebtedness owed by the
Company to third parties in any manner (in either case, using cash, capital
stock (including Common Stock), other Indebtedness or any other assets or
property of the Company), including any Indebtedness incurred by the Company
pursuant to the Deerfield Loan Agreement;
(ii) the
Company and the Board shall not take any action that would have the effect of
accelerating, or would result in the acceleration of, the vesting of any options
or other securities outstanding pursuant to the Company’s option plans and
equity incentive programs;
(iii) except
in connection with a Proposed Alternative Financing permitted pursuant to Section 5.22 herein,
the Company and the Board shall not take any action that would have the effect
of adjusting, or would result in an adjustment to, the purchase price of any
Shares offered hereunder or the applicable “conversion price” set forth in the
applicable Certificate of Designation therefor on or prior to the applicable
Closing for such Shares; and
(iv) except
as required pursuant to the terms of this Agreement, the Company shall not
otherwise issue any shares of such Series A-1 Preferred or Series A-2 Preferred,
respectively, or amend the Certificate of Designation applicable
thereto.
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5.9.
|
Takeover
Provisions
|
Following
the date hereof, the Company shall take all reasonable actions to ensure that
(i) to the extent permissible under law, no “fair price”, “moratorium”, “control
share acquisition” or other form of antitakeover statute or regulation under
Delaware law, including Section 203 of the DGCL, or other state law in which the
Company may become incorporated, (ii) no anti-takeover provision in the
Organizational Documents of the Company or other similar organizational
documents of its Subsidiaries, and (iii) no shareholder rights plan, “poison
pill” or similar measure, in each case that contains restrictions that are
different from or in addition to those contained in Sections 5.1 and
5.2 (including
with respect to the time periods specified in Section 5.1), is
applicable to a Purchaser’s ownership of the Securities or the purchase of
Securities, including additional Series A Preferred, pursuant to the terms of
this Agreement (each a “Takeover
Provision”). If any Takeover Provision shall become applicable
to a Purchaser or the transactions contemplated hereby, including, without
limitation, as a result of the conversion of the Series A Preferred into Common
Stock or pursuant to the exercise of the rights provided for in Sections 5.1 through
5.4, the
Company and the Board shall grant such approvals and take such actions as are
necessary so that the transactions contemplated hereby may be consummated as
promptly as practicable on the terms contemplated hereby and otherwise act to
eliminate the effects of such Takeover Provisions on each Purchaser and the
transactions contemplated hereby.
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5.10.
|
Section 16
Matters
|
(a) Prior
to each Closing, the Company shall take all such steps as may be required to
cause any acquisitions or dispositions of shares of capital stock of the Company
in connection with the transactions contemplated by the Transaction Documents
(including derivative securities of such shares) by each member of a Purchaser
Group who is or will become subject to the reporting requirements of Section
16(a) of the Exchange Act with respect to the Company or will become subject to
such reporting requirements with respect to the Company to be exempt under Rule
16b-3 promulgated under the Exchange Act (“Rule
16b-3”). In addition, for the purpose of seeking an exemption
under Rule 16b-3, the Company shall, upon receiving reasonable prior notice from
any member of a Purchaser Group, request that the Board or the applicable
committee of the Board approve, in accordance with Rule 16b-3 and SEC no-action
letters thereunder, any acquisitions from, or dispositions to, the Company of
Securities, to the extent made by any member of such Purchaser Group who is or
will become subject to the reporting requirements of Section 16(a) of the
Exchange Act with respect to the Company.
(b) Notwithstanding
anything to the contrary contained in the Transaction Documents, if there exists
a period (the “Section
16(b) Period”) during which a Purchaser’s purchase of any Security
pursuant to any Transaction Document would result in liability under Section
16(b) of the Exchange Act, the period during which such Security may be
purchased if prescribed by such Transaction Document, shall be extended until
the date that is the equivalent number of days of such Section 16(b) Period
after the later of (i) the expiration date to purchase such Security, if any, or
(ii) the date of the end of such Section 16(b) Period (the “Section 16(b) Extension
Period”); provided that the
potential matchable transaction must have occurred prior to the date on which
the WP Purchasers have sent the applicable notice to exercise a purchase right
if an extension is sought with respect to an Additional or Subsequent
Issuance.
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5.11.
|
Registration and
Listing
|
(a) So
long as a WP Purchaser Beneficially Owns any Securities, the Company will cause
the Common Stock to continue at all times to be registered under Section 12(g)
of the Exchange Act, will comply in all respects with its reporting and filing
obligations under the Exchange Act, and will not take any action or file any
document (whether or not permitted by the Exchange Act or the rules thereunder)
to terminate or suspend such reporting and filing obligations.
(b) The
Company shall use reasonable best efforts (i) to qualify to list its shares of
Common Stock on an Approved Market as promptly as practicable following the date
hereof; (ii) subject to the qualification for listing set forth in clause (i)
hereof, and so long as the WP Purchasers Beneficially Own any Securities, to
continue the listing or trading of the Common Stock on an Approved Market and to
comply in all respects with the Company’s reporting, filing and other
obligations under the bylaws or rules of the Approved Market on which the Common
Stock is listed for trading; (iii) subject to the qualification for listing set
forth in clause (i) hereof, and so long as the WP Purchasers Beneficially Own
any Securities, to cause the Conversion Shares to be approved for listing and
listed, as applicable, on the Approved Market on which the Common Stock is
listed for trading. Notwithstanding the foregoing, in no event shall
the Company take any action in furtherance of this Section 5.11(b) that
is inconsistent with or in conflict with its other obligations pursuant to this
Agreement and the Transaction Documents without the prior written consent of the
WP Purchasers. The Company shall pay all fees and expenses in
connection with satisfying its obligations under this Section
5.11.
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5.12.
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Private
Offering
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Neither
the Company, any of its Subsidiaries nor any of their respective Affiliates will
sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
of any “security” (as defined in the Securities Act) that could be integrated
with the sale of the Shares in a manner that could require the registration of
the Securities under the Securities Act.
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5.13.
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Form D and Blue
Sky
|
The
Company agrees to timely file a Form D with the SEC with respect to the
Securities to the extent required under Regulation D of the Securities Act and
to provide, upon request, a copy thereof to the Purchasers. The
Company shall take such action as the Company shall reasonably determine is
necessary in order to obtain an exemption for, or to qualify the Securities for,
sale to the Purchasers pursuant to this Agreement under applicable securities
and “blue sky” laws of the states of the United States (or to obtain an
exemption from such qualification), and shall provide evidence of any such
action so taken to the Purchasers on or prior to each respective Closing for the
issuance of such Securities. The Company shall timely make all
filings and reports relating to the offer and sale of the Securities required
under applicable securities and “blue sky” laws of the states of the United
States following each applicable Closing. The Company shall pay all
fees and expenses in connection with satisfying its obligations under this Section
5.13.
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5.14.
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Venture Capital
Qualifying Investment
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(a) The
Company hereby agrees that it shall (i) furnish each Purchaser that is a
“venture capital operating company” within the meaning of Department of Labor
“plan asset” regulations (“VCOC”) with such
financial and operating data and other information with respect to the business
and properties of the Company as the Company prepares and compiles for its
directors in the ordinary course and as a Purchaser may from time to time
reasonably request, (ii) permit each Purchaser that is a VCOC to discuss the
affairs, finances and accounts of the Company, and to make proposals and furnish
advice with respect thereto, with the principal officers of the Company and
(iii) invite a representative of each Purchaser that is a VCOC to attend all
meetings of the Board in a nonvoting observer capacity if no representative of
such Purchaser is a member of the Board and, in this respect, shall give such
representative copies of all notices, minutes, consents and other material that
it provides to the directors and such representative shall be entitled to
participate in discussions of matters brought to the Board. With respect to a
Purchaser that is a VCOC, the provisions of this Section 5.14 shall
terminate only with respect to such Purchaser on the earlier of (i) the date on
which Purchaser ceases to be a VCOC, (ii) the date on which the provisions of
this Section
5.14 are no longer required in order for the ownership of the Securities
by such Purchaser to qualify as a venture capital investment within the meaning
of Department of Labor “plan asset” regulations; and (iii) the date such
Purchaser no longer owns any Securities.
(b) Each
Purchaser agrees that such Purchaser will keep confidential and will not
disclose, divulge, or use for any purpose (other than to monitor its investment
in the Company) any confidential information obtained from the Company pursuant
to the terms of this Agreement or any other Transaction Document, unless such
confidential information (a) is known or becomes known to the public in general
(other than as a result of a breach of this Section 5.14(b) by such Purchaser),
(b) is or has been independently developed or conceived by the Purchaser or its
agents without use of the Company’s confidential information, (c) is or has been
made known or disclosed to the Purchaser by a third party without a breach of
any obligation of confidentiality such third party may have to the Company, or
(d) is communicated to the Purchaser free of any obligation of confidentiality;
provided, however, that a
Purchaser may disclose confidential information (i) to its attorneys,
accountants, consultants, and other professionals; (ii) to any Affiliate,
partner, member, stockholder, agent or wholly owned subsidiary of such; (iii) to
any prospective purchaser of any beneficial equity interest in such Purchaser or
any of its respective Affiliates; (iv) to any current, former or prospective
investors of such Purchaser (including, without limitation, limited partners);
(v) to any current, former or potential lenders or financing sources; (vi) to
any of its marketing or public relations representatives; (vii) to any other
Person to whom such Purchaser is contractually obligated or required to provide
such information; or (viii) as may otherwise be required in response to a court
order or by law or administrative process, provided that the Purchaser promptly
notifies the Company of such legally required disclosure and takes reasonable
steps to minimize the extent of any such required disclosure; provided further,
in the case of disclosures pursuant to clauses (d)(ii) through (vii), the
Purchaser shall inform such Person that such information is confidential and
request such Person to maintain the confidentiality of such
information. The Company acknowledges and agrees that effective upon
the First Closing that certain Confidentiality Agreement, dated as of January
26, 2010, between the Company and Warburg Pincus LLC shall be deemed to be
automatically terminated.
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5.15.
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Tax Treatment of
Preferred Stock
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(a) The
Purchasers and the Company agree not to treat the Shares as “preferred stock”
within the meaning of Treasury Regulations Section 1.305-5 for United States
income tax purposes, and therefore as not subject to Section 305 of the Code,
and based upon the terms of the Shares as of the Closing Date, the Company shall
report dividend income for federal, and any applicable state and local, income
tax purposes to the Purchasers solely to the extent that cash dividends are paid
on the Shares. Neither the Company nor the Purchasers shall take any
position contrary to the foregoing on any tax return. Notwithstanding
the foregoing, neither the Purchasers nor the Company shall be required to take
any action pursuant to this Section 5.15(a) if
doing so would be reasonably likely, based upon advice of the Company’s tax
advisers, to be unfounded, unlawful or potentially subject the Purchasers or the
Company to a material penalty.
(b) From
and after the Closing and so long as any Shares are outstanding, neither the
Company nor any Disregarded Entity shall issue any convertible debt or, in the
case of the Company, any other class of stock, and none of the Company’s
Subsidiaries shall issue any debt that is convertible or exchangeable into stock
of the Company or any Disregarded Entity. For purposes of the
preceding sentence, a “Disregarded Entity”
shall mean (i) a direct Subsidiary of the Company if such Subsidiary is treated
as a disregarded entity for U.S. federal income tax purposes, and (ii) an
indirect Subsidiary of the Company provided that (y) such Subsidiary is treated
as a disregarded entity for U.S. federal income tax purposes and (z) such
Subsidiary is owned by an entity treated as a disregarded entity for U.S.
federal income tax purposes.
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5.16.
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Board
Representation
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(a) The
Company shall take all requisite action such that on the date hereof, the size
of the Board shall be set at nine (9) members and five (5) individuals
designated by the WP Purchasers (each director designated by the WP Purchasers
under this Agreement, a “WP Purchaser
Designee”, and collectively, the “WP Purchaser
Designees”) as Board nominees shall be appointed to the Board, and on the
date hereof, the Resigning Directors shall resign; provided, however, the WP
Purchasers shall be permitted, in their discretion, to defer appointment of one
or more of the WP Purchaser Designees to one or more subsequent
dates.
(b) (i)
From and after the date hereof, the Company shall cause five (5) WP Purchaser
Designees to be nominated by the Company to serve on the Board and the total
number of members of the Board shall be nine (9) or fewer to the extent certain
of the WP Purchaser Designees have not been appointed to the Board (as permitted
above). Any WP Purchaser Designees shall be appointed to the Board on
the date hereof or to the extent designated following the First Closing Date,
shall be appointed to the Board promptly following notice from the WP Purchasers
and in any event, within one (1) Business Day. From and after the
date hereof, the Company shall not change the size of the Board without the
prior written consent of the WP Purchasers; provided that, unless
waived by the WP Purchasers, in the event the size of the Board is changed, the
WP Purchasers shall have the right to designate that number of WP Purchaser
Designees to be nominated or appointed to the Board to maintain proportional
Board representation not less that set forth in the previous
sentence. For so long as such membership does not conflict with any
applicable law or regulation or listing requirement of any Approved Market on
which the Common Stock is listed for trading (as determined in good faith by the
Board), the WP Purchaser Designees shall be entitled to serve as a member of, or
observer to, at the WP Purchaser Designee’s election, each of the committees of
the Board, except for any committee formed to consider a transaction between the
Company and a member of the WP Purchaser Group. The Company
acknowledges that the WP Purchaser Designees intend to hold positions on the
Board committees and that following the date hereof the Company will take all
actions necessary to arrange for the prompt appointment of the WP Purchaser
Designees to any such committees (subject to the limitations in the immediately
preceding sentence). The Company shall consult with the WP
Purchasers, and the WP Purchasers shall have the right to participate (including
in any interviews), in the selection of other directors that will serve on the
Board. The WP Purchasers’ rights set forth in this Section 5.16(b) shall
terminate on the first date on which the WP Purchasers collectively do not own
at least 75% of the shares of Series A Preferred actually issued to, and
purchased by, the WP Purchasers hereunder (including Conversion Shares issued on
conversion thereof and any other securities of the Company or any successor
thereto into which such Shares are converted or exchanged).
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(c) Solely
with respect to those WP Purchaser Designees that the WP Purchasers are entitled
to designate pursuant to Sections 5.16(a)
and/or 5.16(b)
(and solely as long as the WP Purchasers remain entitled to so designate such WP
Purchaser Designees):
(i)
The Company shall use its reasonable best efforts to
have such WP Purchaser Designees elected as directors of the Company, including,
without limitation, including such WP Purchaser Designees in the Company’s proxy
statement for the election of directors as part of “management’s slate”,
soliciting proxies for such WP Purchaser Designees to the same extent as it does
for any of its nominees to the Board, and including the recommendation of the
Board in favor of election of the WP Purchaser Designees. In the
event a WP Purchaser Designee is not elected at a stockholders meeting at which
such designee is up for election, the Company shall cause such WP Purchase
Designee to be appointed to the Board.
(ii) The
WP Purchasers may remove any WP Purchaser Designee at any time, with or without
cause. Any vacancy in the position of such a WP Purchaser Designee
shall only be filled with another WP Purchaser Designee. Any vacancy
created by any removal of a WP Purchaser Designee or an election of the WP
Purchasers to defer appointing one or more WP Purchaser Designees shall also
only be filled with another WP Purchaser Designee. The Company shall
not take any action to remove any WP Purchaser Designee without the consent of
the WP Purchasers or fill a vacancy reserved for a WP Purchaser
Designee. Any replacement WP Purchaser Designees shall be appointed
to the Board promptly following notice from the WP Purchasers and in any event,
within two (2) Business Days.
(iii) Each
WP Purchaser Designee shall be given notice of (in the same manner that notice
is given to other members of the Board) all meetings (whether in person,
telephonic or otherwise) of the Board, including all committee meetings with
respect to committees on which such WP Purchaser Designee
serves. Each WP Purchaser Designee shall receive a copy of all
notices, agendas and other materials distributed to the Board, whether provided
to directors in advance or during or after any meeting, regardless of whether
such WP Purchaser Designee will be in attendance at the meeting.
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(d) In
addition to any other indemnification rights the WP Purchaser Designees have
pursuant to this Agreement, the Certificate of Incorporation and the Bylaws,
each such WP Purchaser Designee that serves on the Board shall have the right to
enter into, and the Company agrees to enter into, an Indemnification Agreement
and a side letter contemplated by Section
6.1(n). The Company shall maintain director and officer
insurance covering the WP Purchaser Designees on the same terms and with the
same amount of coverage as is provided to other members of the
Board. The Company shall reimburse the reasonable expenses incurred
by the WP Purchaser Designees in connection with attending (whether in person or
telephonically) all meetings of the Board or committees thereof or other Company
related meetings to the same extent as all other members of the Board are
reimbursed for such expenses (or, in case any such expense reimbursement policy
shall apply only to non-employee directors, to the same extent as all other
non-employee directors). The WP Purchaser Designees shall be entitled
to the same compensation for service on the Board, including, without
limitation, cash fees, stock options, restricted stock and other equity awards,
as is provided to other non-employee directors.
(e) The
Company and the Purchasers shall take or cause to be taken all lawful action
necessary to ensure at all times as of and following the Closing Date that the
Organizational Documents of the Company are not inconsistent with the provisions
of this Agreement and the Transaction Documents or the transactions contemplated
hereby or thereby.
(f)
Solely during the period from the date hereof until the date that is
185 days after the date hereof, the WP Purchasers shall not take any action to
remove Xxxxxx Xxxxx as a member of the Board.
5.17. Corporate
Opportunity. In recognition that each Purchaser and its
Representatives currently have, and may in the future have or may consider
acquiring, investments in Persons with respect to which each Purchaser or its
Representatives may serve as an advisor, a director or in some other capacity,
and in recognition that each Purchaser and its Representatives may have myriad
duties to various investors and partners, and in anticipation that the Company
and its Subsidiaries, on the one hand, and each of the Purchasers, on the other
hand, may engage in the same or similar activities or lines of business and have
an interest in the same areas of corporate opportunities, and in recognition of
the benefits to be derived by the Company hereunder and in recognition of the
difficulties which may confront any advisor who desires and endeavors fully to
satisfy such advisor’s duties in determining the full scope of such duties in
any particular situation, the provisions of this Section 5.17 are set
forth to regulate, define and guide the conduct of certain affairs of the
Company as they may involve such Purchaser. The Company agrees on its
behalf and on behalf of its Subsidiaries as follows:
(a) Such
Purchaser and its respective Representatives shall have the right: (i) to
directly or indirectly engage in any biopharmaceutical acquisition, development
and commercialization or other lines of business that are the same as or similar
to those pursued by, or competitive with, the Company and its Subsidiaries, (ii)
to directly or indirectly do business with any client or customer of the Company
and its Subsidiaries, (iii) to take any other action that such Purchaser
believes is necessary to or appropriate to fulfill its obligations as described
in the first sentence of this Section 5.17, and
(iv) not to present potential transactions, matters or business opportunities to
the Company or any of its Subsidiaries, and to pursue, directly or indirectly,
any such opportunity for itself, and to direct any such opportunity to another
person.
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(b) Such
Purchaser and its Representatives shall have no duty (contractual or otherwise)
to communicate or present any corporate opportunities to the Company or any of
its stockholders, Subsidiaries or Affiliates or to refrain from any actions
specified in this Section 5.17, and the
Company, on its own behalf and on behalf of its stockholders, Subsidiaries and
Affiliates, hereby renounces and waives any right to require such Purchaser or
any of its Representatives to act in a manner inconsistent with the provisions
of this Section
5.17.
(c) None
of the Purchasers, nor any of their respective Representatives, shall (i) be
liable to the Company or any of its stockholders, Subsidiaries or Affiliates for
breach of any duty (contractual or otherwise) by reason of any activities or
omissions of the types referred to in this Section 5.17 or of
any such person’s participation therein, or (ii) have any duty to communicate or
present any activities or omissions of the types referred to in this Section 5.17 to the
Company or its stockholders, Subsidiaries or Affiliates. The
Purchasers and their respective Representatives shall have the right to hold any
of the activities or omissions of the types referred to in this Section 5.17 for
their own accounts, or the account of another Person, or to recommend, sell,
assign or otherwise transfer such activity or omission to Persons other than the
Company or any stockholder, Subsidiary or Affiliate of the
Company. The Company acknowledges that this Section 5.17
renounces specified business opportunities as contemplated by Section 122(17) of
the DGCL. To the fullest extent permitted by the DGCL, the Company
hereby waives any claim against each Purchaser and its Representatives, and
agrees to indemnify each Purchaser and its Representatives against any claim,
that is based on fiduciary duties, the corporate opportunity doctrine or any
other legal theory which could limit any Purchaser or its Representatives from
pursuing or engaging in transactions contemplated by this Section
5.17.
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5.18.
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Legends
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(a) All
certificates representing the Series A Preferred or Conversion Shares held by
the Purchasers shall bear a legend substantially in the following
form:
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION
STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR
SUCH LAWS.
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AN INVESTMENT
AGREEMENT (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE
COMPANY). NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR
OTHER DISPOSITION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE MADE
EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH INVESTMENT
AGREEMENT.
THE
COMPANY WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS AT THE
COMPANY’S PRINCIPAL OFFICE THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE
PARTICIPATING, OPTIONAL AND OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR
SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS ON SUCH
PREFERENCES AND/OR RIGHTS.”
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(b) Upon
request of a Purchaser, upon receipt by the Company of an opinion of counsel
reasonably satisfactory to the Company to the effect that such legend is no
longer required under the Securities Act or applicable state laws, as the case
may be, the Company shall promptly cause the first paragraph of the legend to be
removed from any certificate for any Securities to be so transferred and the
second paragraph of the legend shall be removed upon the expiration of the
transfer restrictions set forth in this Agreement. The third
paragraph shall be removed if such paragraph is no longer required pursuant to
the DGCL.
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5.19.
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Right of First
Offer.
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Except
for Permitted Transfers, in the event that a Deerfield Purchaser desires to
directly or indirectly Transfer any of its Securities, then it shall first send
a notice of such proposed Transfer to the WP Purchasers, together with a
detailed description of the terms and conditions of such Deerfield Purchaser’s
proposed offer of such Securities, including the purchase price for such
Securities (a “ROFO
Offer”), prior to engaging in any discussions with any third party with
regard to a Transfer of such Securities or effecting any such
Transfer. For a period of fifteen (15) days (the “ROFO Negotiation
Period”) from receipt of a ROFO Offer, such Deerfield Purchaser and the
WP Purchasers shall have a right to discuss in good faith the terms and
conditions of an agreement regarding the proposed Transfer of the Securities to
the WP Purchaser Group. During the ROFO Negotiation Period, the
Deerfield Purchasers shall refrain from engaging in any discussions with any
third party (other than the WP Purchasers) regarding a Transfer of such
Securities to such third party. If at the expiration of the ROFO
Negotiation Period such Deerfield Purchaser and the WP Purchasers shall have not
reached agreement with regard to the terms and conditions of such Transfer, then
such Deerfield Purchaser shall be free for a period of ninety (90) days after
the expiration of the ROFO Negotiation Period to Transfer such Securities to a
third party transferee for the same or greater purchase price, and on terms no
more beneficial in any material respect to the third party transferee than, as
set forth in the ROFO Offer.
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5.20.
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Certificate of
Elimination
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In the
event the Stockholder Approval is not obtained on or prior to the Stockholder
Approval Outside Date and the Second Closing does not occur, the Company shall
file with the Secretary of State of the State of Delaware promptly following the
Stockholder Approval Outside Date a “Certificate of Elimination” with respect to
the Series A-2 Preferred, which shall cancel the Series A-2 Certificate of
Designation, in accordance with the DGCL.
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5.21.
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Reverse Stock Split;
Authorized Common Stock
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(a) No
fractional shares shall be issued in connection with the Reverse Stock
Split. Notwithstanding the foregoing, in connection with the Reverse
Stock Split, the number of shares to be issued to a holder of Common Stock as a
result of the Reverse Stock Split shall be computed on the basis of all shares
of Common Stock held by such holder, and shall include the aggregation of all
fractional shares of Common Stock that would, but for the previous sentence, be
issuable as a result of the Reverse Stock Split. If after giving
effect to the aggregation of all shares of Common Stock (and fractions thereof)
issuable to the same holder at one time as set forth in the previous sentence,
any fraction of a share of Common Stock would still be issuable as a result of
the Reverse Stock Split, the Company shall pay the holder thereof cash in lieu
of such fractional share valued at the Closing Price on the effective date of
the Reverse Stock Split.
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(b) The
Reverse Stock Split Ratio shall be determined by mutual agreement between the
Company and the WP Purchasers, provided that in the
event the Company and the WP Purchasers are not able to reach agreement
regarding the Reverse Stock Split Ratio prior to the date that is five (5)
Business Days prior to the date on which the Company first files its preliminary
Proxy Statement with the SEC, the Reverse Stock Split Ratio shall be determined
by the WP Purchasers in their sole discretion.
(c) The
Authorized Common Stock Number shall be determined by mutual agreement between
the Company and the WP Purchasers, provided that in the
event the Company and the WP Purchasers are not able to reach agreement
regarding the Authorized Common Stock Number prior to the date that is five (5)
Business Days prior to the date on which the Company first files its preliminary
Proxy Statement with the SEC, the Authorized Common Stock Number shall be
determined by the WP Purchasers in their sole discretion.
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5.22.
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Proposed Alternate
Financing
|
(a) Subject
to limitations set forth herein, following the first anniversary of the date
hereof, each Purchaser agrees to execute and deliver a written consent pursuant
to Section 5(b)(v) of the Series A-1 Certificate of Designation or Series A-2
Certificate of Designation, as applicable, in connection with a proposed equity
financing of the Company (a “Proposed Alternate
Financing”) if all of the following conditions have been
satisfied:
(i)
the Company has cash and cash equivalents (determined in
accordance with GAAP) on hand of less than $3,000,000 in the aggregate and each
Purchaser shall have received a certificate signed on behalf of the Company by
the Chief Financial Officer of the Company to the foregoing (a “Proposed Alternate Financing
Certificate”);
(ii) the
WP Purchasers have not sent a Series A-1 Additional Investment Notice, a Series
A-2 Subsequent Investment Notice, a Series A-1 Annex I Additional Investment
Notice, or a Series A-1 Annex I Subsequent Investment Notice to the Company
within ten (10) days following the delivery of such Proposed Alternate Financing
Certificate;
(iii) in
connection with such Proposed Alternate Financing, the Company shall not issue
any equity securities of the Company other than Common Stock or options or
warrants to directly acquire only shares of Common Stock;
(iv)
the Proposed Alternate Financing shall provide
gross cash proceeds to the Company of no more than $10,000,000;
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(v) if
the Company issues shares of Common Stock (or options or warrants to directly
acquire only shares of Common Stock) in such Proposed Alternate Financing, the
price per share of Common Stock (or the applicable exercise price for each share
of Common Stock) issued in such Proposed Alternate Financing shall be not less
than 25% below the Current Market Price (as such term is defined in the Series
A-1 Certificate of Designation) of the Common Stock;
(vi) the
maximum aggregate number of shares of Common Stock issued (including shares of
Common Stock issuable upon exercise or conversion of any options, warrants or
other derivative securities) in such Proposed Alternate Financing shall not
exceed the number equal to the quotient of (A) $10,000,000 divided by (B) 75% of
the Current Market Price (as such term is defined in the Series A-1 Certificate
of Designation) of the Common Stock;
(vii) the
Proposed Alternate Financing shall have been approved by a majority of the
Independent Directors; and
(viii) the
Proposed Alternate Financing is otherwise consummated in accordance with the
terms of this Agreement, including Section 5.4 hereof.
For the
avoidance of doubt, nothing contained herein shall preclude the Company from
issuing shares of Common Stock in a transaction effected in accordance with
Section 5(b)(v) of the Series A-1 Certificate of Designation or Series A-2
Certificate of Designation, as applicable.
(b) In
the event the WP Purchasers send a Series A-1 Additional Investment Notice, a
Series A-2 Subsequent Investment Notice, a Series A-1 Annex I Additional
Investment Notice, or a Series A-1 Annex I Subsequent Investment Notice to the
Company pursuant to Section 5.22(a)(ii),
for the purposes of Section 2 any minimum
amount or threshold otherwise applicable to such investment shall be reduced to
$2,500,000.
(c) This
Section 5.22
shall no longer be applicable upon the date as of which the Purchasers no longer
have the ability to purchase any Securities pursuant to Section 2
hereof.
5.23. Limitation on
Conversion. Until the date on which the Company has obtained
the Stockholder Approvals, each Purchaser agrees that such Purchaser and its
transferees of Securities permitted under this Agreement (“Permitted
Transferees”) will not convert or seek to convert, and the Company will
be permitted to restrict the conversion of, shares of Series A-1 Preferred held
by such Purchaser, including any Permitted Transferees, to the extent such
conversion would result in such Purchaser receiving shares of Common Stock in
excess of the product obtained by multiplying (A) the quotient obtained by
dividing (i) the number of shares of Series A-1 Preferred purchased by such
Purchaser (including shares transferred to Permitted Transferees) pursuant to
this Agreement by (ii) the total number of shares of Series A-1 Preferred issued
by the Company pursuant to this Agreement by (B) the greater of 90,000,000 and
the Excess Authorized Shares Threshold (as defined in Annex I of the Series A-1
Certificate of Designation). By way of example, assuming the WP
Purchasers purchase 80% of the shares of Series A-1 Preferred issued pursuant to
this Agreement, until the date on which the Company has obtained the Stockholder
Approvals the WP Purchasers could not in the aggregate convert shares of Series
A-1 Preferred if such conversion would result in the WP Purchasers being issued
more than 72,000,000 shares of Common Stock in the aggregate upon conversion
thereof. For the avoidance of doubt, the limitation contained in this
Section 5.23
shall not limit the ability of the Required Holders (as defined in Annex I of
the Series A-1 Certificate of Designation) to mandatorily convert shares of
Series A-1 Preferred pursuant to Section 7(b) of Annex I of the Series A-1
Certificate of Designation.
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5.24. Notice of Marketing
Approval. The Company shall provide each of the Purchasers
hereunder with written notice within two (2) Business Days of the date on which
the Company first receives written marketing approval in the United States
(which for the purposes of clarity shall include “accelerated approval”) from
the FDA for a New Drug Application submitted for any of the Company Products,
which notice shall specify that such approval has been received and which notice
may be accomplished by the Company sending to the Purchasers the applicable
press release regarding such approval in accordance with the notice provisions
set forth in Section
10.1 hereof.
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SECTION
6.
|
CONDITIONS TO THE
FIRST CLOSING
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6.1.
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Purchasers’ Actions to
be Taken at the First
Closing
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Each of
the following actions shall be taken, or documents delivered, as the case may
be, by the Company on or prior to the First Closing Date, any of which may be
waived only in the sole discretion of the WP Purchasers, which waiver shall be
applicable with respect to all Purchasers:
(a) Accuracy of Representations
and Warranties. The representations and warranties of the
Company set forth in Section 3 of this
Agreement shall be true and correct as of the First Closing Date and such
Purchaser shall have received a certificate signed on behalf of the Company by
the Chief Executive Officer or the Chief Financial Officer of the Company to the
foregoing effect.
(b) Performance. The
Company shall have performed or complied in all material respects with all
agreements, obligations, covenants and conditions contained in this Agreement to
be performed or complied with by the Company on or prior to the First Closing
Date and such Purchaser shall have received a certificate signed on behalf of
the Company by the Chief Executive Officer or the Chief Financial Officer of the
Company to the foregoing effect.
(c) Board of
Directors. The Company shall have taken all actions necessary
and appropriate to cause Xxxxxxxx Xxxx, Xxxxxx XxXxxxx and Xxxxxx Xxxxxx to be
appointed to the Board effective immediately upon the First
Closing.
(d) Certificates of
Designation. The Series A-1 Certificate of Designation and
Series A-2 Certificate of Designation and the Certificate of Elimination shall
have been duly filed with the Secretary of State of the State of Delaware and
satisfactory evidence of such filings shall have been delivered to such
Purchaser.
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(e) Bylaws
Amendment. The Board shall have adopted the Bylaws Amendment
and satisfactory evidence of such Bylaws Amendment shall have been delivered to
such Purchaser.
(f)
Deerfield Debt
Amendments. Solely as a condition to the obligations of the WP
Purchasers hereunder, an amendment to the Deerfield Loan Agreement that is
satisfactory to the WP Purchasers in their sole discretion shall have been
executed and delivered by the Company and each of the requisite lenders under
the Deerfield Loan Agreement.
(g) Fairness
Opinion. The Board shall have received an opinion (the “Fairness Opinion”)
from Xxxx Capital Partners LLC to the effect that as of the First Closing Date
and based upon and subject to the matters set forth therein, the issuance and
sale of the Series A Preferred pursuant to this Agreement are fair to the
stockholders of the Company from a financial point of view and such opinion
shall not been amended or rescinded.
(h) Counsel’s
Opinion. Such Purchaser shall have received an opinion from
the Company’s counsel, Xxxxxxxxxx & Xxxxx, P.A., dated the First Closing
Date, and substantially in the form of Exhibit C
hereto.
(i)
Registration Rights
Agreement. The Company shall have executed and delivered to
such Purchaser the Registration Rights Agreement in the form attached hereto as
Exhibit D (the
“Registration Rights
Agreement”).
(j)
Certificate of
Conversion. Solely as a condition to the obligations of the WP
Purchasers hereunder, the Deerfield Purchasers shall have each executed and
delivered to the Company and the WP Purchasers a certificate of conversion in
the form attached hereto as Exhibit E (the “Certificate of
Conversion”) in furtherance of the Company’s rights under Section 2.6(c), which
certificate shall (i) be irrevocable and (ii) automatically become effective on
the Deerfield Termination Date.
(k) Voting
Agreement. Solely as a condition to the obligations of the WP
Purchasers hereunder, the Deerfield Purchasers shall have each executed and
delivered a Voting Agreement, substantially in the form of Exhibit
F.
(l)
Stock
Certificates. The Company shall have delivered to such
Purchaser one or more validly issued stock certificates to such Purchaser
representing the First Closing Shares purchased by such Purchaser, duly executed
by the appropriate officers of the Company.
(m) Resignation
Letters. The Company shall have delivered to each Purchaser
resignation letters from the Resigning Directors.
(n) Indemnification Side
Letter. Solely as a condition to the obligations of the WP
Purchasers hereunder, the Company shall have executed and delivered to each WP
Purchaser a letter agreement in the form of Exhibit
G.
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(o) Secretary’s
Certificate. Such Purchaser shall have received a certificate,
dated the First Closing Date, of the Secretary of the Company attaching (i) a
true and complete copy of the Certificate of Incorporation of the Company as
filed with the Secretary of State of the State of Delaware, with all amendments
thereto, (ii) true and complete copies of the Company’s Bylaws in effect as of
such date, and (iii) resolutions of the Board authorizing the execution and
delivery of this Agreement and the Transaction Documents and the transactions
contemplated hereby and thereby.
(p) Canadian Royalty
Payments. The Company shall have received from any Canadian
Person to whom the Company makes royalty payments a properly completed and duly
executed U.S. IRS Form W-8BEN certifying that no withholding tax is required to
be paid in connection with the payment of such royalties and satisfactory
evidence of such executed forms shall have been delivered to such
Purchaser.
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SECTION
7.
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CONDITIONS TO THE
SECOND CLOSING
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7.1.
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Purchasers’ Conditions
to the Second Closing
|
The
occurrence of the Second Closing Date shall be subject to the satisfaction or
waiver (which may be waived solely in the discretion of the WP Purchasers, which
waiver shall be applicable with respect to all Purchasers) on or prior to the
Stockholder Approval Outside Date of the following:
(a) Accuracy of Representations
and Warranties. Each of (i) the representations and warranties
of the Company set forth in Section 3.1 (Corporate Organization), Section 3.2
(No Subsidiaries), Section 3.3 (Capitalization), Section 3.4 (Authorization),
Section 3.5 (No Conflicts), Section 3.6 (Approvals), Section 3.7 (Reports and
Financial Statements) and Section 3.25 (Investment Banking) shall be true and
correct as of the date of this Agreement and as of the Second Closing Date
(except that those representations and warranties which address matters only as
of a particular date need only be true and correct as of such date) and (ii) all
other representations and warranties of the Company contained in this Agreement
shall be true and correct as of the date of this Agreement and as of the Second
Closing Date (except that those representations and warranties which address
matters only as of a particular date need only be true and correct as of such
date), except to the extent that the failure of any such representation or
warranty specified in this Section 7.1(a)(ii) to be true and correct (without
giving effect to any limitation as to “materiality” or “Material Adverse Effect”
set forth therein), individually or taken together with any other failures of
representations and warranties to be so true and correct, has not had and would
not reasonably be expected to have a Material Adverse
Effect. Purchaser shall have received a certificate signed on behalf
of the Company by the Chief Executive Officer or the Chief Financial Officer of
the Company to the foregoing effect.
(b) Performance. The
Company shall have performed or complied in all material respects with all
agreements, obligations, covenants and conditions contained in this Agreement to
be performed or complied with by the Company on or prior to the Second Closing
Date and such Purchaser shall have received a certificate signed on behalf of
the Company by the Chief Executive Officer or the Chief Financial Officer of the
Company to the foregoing effect.
(c) No Injunctions, Orders,
Etc. No provision of any applicable law or regulation and no
judgment, injunction, order or decree of any Governmental Authority of competent
jurisdiction shall prohibit the Second Closing or shall prohibit or restrict
such Purchaser or its Purchaser Affiliates from owning, voting, or converting or
exercising any Securities in accordance with the terms thereof and no lawsuit
shall have been commenced by any Governmental Authority of competent
jurisdiction seeking to effect any of the foregoing.
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(d) Absence of Certain
Events. Since the date of this Agreement, no Material Adverse
Effect shall have occurred. Since the date of this Agreement, a
Special Triggering Event (as defined in Annex I of the Series A-1 Certificate of
Designation) shall not have occurred.
(e) Stockholder
Approval. The Company shall have obtained the Stockholder
Approval.
(f) Charter
Amendment. The Charter Amendment shall have been duly filed
with the Secretary of State of the State of Delaware and satisfactory evidence
of such filing shall have been delivered to such Purchaser.
(g) Fairness
Opinion. The Fairness Opinion shall not have been amended or
rescinded.
(h) Counsel’s
Opinion. Such Purchaser shall have received an opinion from
the Company’s counsel, Xxxxxxxxxx & Xxxxx, P.A (or another counsel
reasonably acceptable to the WP Purchasers), dated the Second Closing Date, and
substantially in the form of Exhibit D hereto with
such changes to reflect the Securities to be issued at the Second
Closing.
(i) Board of
Directors. Except to the extent the WP Purchasers have
determined to defer the appointment of one or more additional WP Purchaser
Designees pursuant to Section 5.16(a),
effective prior to the Second Closing the Company shall have taken all actions
necessary and appropriate to cause any additional WP Purchaser Designees
designated by the WP Purchasers pursuant to Section 5.16 to be
appointed to the Board in the time period required by Section
5.16. In addition, each such person shall have been appointed
to the committees of the Board designated by the WP Purchasers.
(j) Stock
Certificates. The Company shall have delivered to such
Purchaser one or more validly issued stock certificates to such Purchaser
representing the Second Closing Shares purchased by such Purchaser, duly
executed by the appropriate officers of the Company.
(k) Secretary’s
Certificate. Such Purchaser shall have received a certificate,
dated the Second Closing Date, of the Secretary of the Company attaching (i) a
true and complete copy of the Certificate of Incorporation of the Company as
filed with the Secretary of State of the State of Delaware, with all amendments
thereto, and (ii) a true and complete copy of the Company’s Bylaws in effect as
of such date.
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|
7.2.
|
The Company’s
Conditions to the Second
Closing
|
The
occurrence of the Second Closing Date shall be subject to the satisfaction or
waiver (by the Company) on or prior to the Stockholder Approval Outside Date of
the following:
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(a) Accuracy of Representations
and Warranties. The representations and warranties of such
Purchaser set forth in Section 4 of this
Agreement shall be true and correct as of the date of this Agreement and the
Second Closing Date and the Company shall have received a certificate signed on
behalf of such Purchaser by an authorized representative of such Purchaser to
the foregoing effect.
(b) Performance. Such
Purchaser shall have performed or complied in all material respects with all
agreements, obligations, covenants and conditions contained in this Agreement to
be performed or complied with by such Purchaser on or prior to the Second
Closing Date and the Company shall have received a certificate signed on behalf
of such Purchaser by an authorized representative of such Purchaser to the
foregoing effect.
(c) No Injunctions, Orders,
Etc. No provision of any applicable law or regulation and no
judgment, injunction, order or decree of any Governmental Authority of competent
jurisdiction shall prohibit the Second Closing or shall prohibit or restrict
such Purchaser or its Purchaser Affiliates from owning, voting, or converting or
exercising any Securities in accordance with the terms thereof and no lawsuit
shall have been commenced by any Governmental Authority of competent
jurisdiction seeking to effect any of the foregoing.
|
SECTION
8.
|
CLOSING DELIVERIES FOR
ADDITIONAL PURCHASES OF SERIES A
PREFERRED
|
|
|
8.1.
|
Series A-1 Additional
Investment Closing, the Series A-2 Subsequent Investment Closing, a Series
A-1 Annex I Additional Investment Closing and a Series A-1 Annex I
Subsequent Investment
Closing
|
Concurrent
with each of the Series A-1 Additional Investment Closing Date, the Series A-2
Subsequent Investment Closing Date, a Series A-1 Annex I Additional Investment
Closing Date or a Series A-1 Annex I Subsequent Investment Closing Date, as
applicable, the Company shall deliver the following documents to the Purchasers,
any of which may be waived only in the sole discretion of the WP Purchasers,
which waiver shall be applicable with respect to all Purchasers:
(a) Counsel’s
Opinion. Such Purchaser shall have received an opinion from
the Company’s counsel, Xxxxxxxxxx & Xxxxx, P.A (or another counsel
reasonably acceptable to the WP Purchasers), dated such Closing Date, and
substantially in the form of Exhibit D hereto with
such changes to reflect the Securities to be issued at such
Closing.
(b) Stock
Certificates. The Company shall have delivered to such
Purchaser one or more validly issued stock certificates to such Purchaser
representing the applicable Securities purchased by such Purchaser, duly
executed by the appropriate officers of the Company.
(c) Secretary’s
Certificate. Each Purchaser shall have received a certificate,
dated such Closing Date, of the Secretary of the Company attaching (i) a true
and complete copy of the Certificate of Incorporation of the Company as filed
with the Secretary of State of the State of Delaware, with all amendments
thereto, and (ii) true and complete copies of the Company’s Bylaws in effect as
of such date.
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SECTION
9.
|
INTERPRETATION OF THIS
AGREEMENT
|
|
|
9.1.
|
Terms
Defined
|
As used
in this Agreement, the following terms have the respective meanings set forth
below or set forth in the Section hereof following such term:
242(b)(2)
Proposal: shall mean an amendment to the Certificate of
Incorporation, through the Charter Amendment, to include the following
text:
“The
number of authorized shares of Common Stock may be increased or decreased by the
affirmative vote of the holders of a majority of the issued and outstanding
Common Stock and Preferred Stock voting together as a single class, and the
holders of Common Stock shall not be entitled to any separate class vote in
connection with any increase or decrease of the aggregate number of authorized
shares of Common Stock, notwithstanding the provisions of Section 242(b)(2) of
the Delaware General Corporation Law, as amended from time to
time.”
Acquiring
Person: shall mean any Person or group (within the meaning of
Section 13(d)(3) of the Exchange Act) (other than any Person who is a member of
the WP Purchaser Group); provided, however, that for
purposes of Section
5.3, an Acquiring Person shall not include a Purchaser solely by reason
of such Purchaser’s taking or agreeing to take any action permitted under Section
5.3.
Additional or Subsequent
Issuance: shall have the meaning set forth in Section
2.6(b).
Additional Series A-1
Preferred Shares: shall have the meaning set forth in Section
2.2(a).
Affiliate: shall
mean any Person or entity, directly or indirectly, controlling, controlled by or
under common control with such Person or entity.
Agreement: shall
mean this Investment Agreement, dated as of June 7, 2010, among the Company and
the Purchasers, as the same may be amended from time to time.
Antitrust Extension
Period: shall have the meaning set forth by Section
5.7(b).
Antitrust
Regulations: shall have the meaning set forth by Section
5.7(b).
Approved
Markets: shall mean the NASDAQ Global Select Market, the
NASDAQ Global Market, the NASDAQ Capital Market or the New York Stock
Exchange.
Authorized Common Stock
Number: shall mean the number of shares of Common Stock to be
authorized pursuant to the Capitalization Proposal, which shall be determined
pursuant to Section
5.21(c).
Authorized Preferred
Stock: shall have the meaning set forth in Section
3.3(a).
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Beneficially Own or
Beneficial Ownership: shall mean, with respect to any
securities, having “beneficial ownership” of such securities (as determined
pursuant to Rule 13d-3 under the Exchange Act).
Board: shall
have the meaning set forth in Section
2.5(b).
Business
Day: shall mean any day except Saturday, Sunday and any day
which shall be a legal holiday or a day on which banking institutions in the
State of New York generally are authorized or required by law or other
governmental actions to close.
Buyout
Transaction: shall mean a tender offer, exchange offer,
merger, consolidation, amalgamation, scheme or arrangement, acquisition,
business combination or similar transaction, except such a transaction that is
proposed by or involves a member of a Purchaser Group and has not been approved
by the Board, that offers each holder of Common Stock (other than, if
applicable, the Person proposing such transaction or other Persons participating
in such transaction, including Persons who rollover their Common Stock or other
securities of the Company) the opportunity to receive with respect to such
holder’s Common Stock the same consideration per share of Common Stock (which
shall include, without limitation, cash and stock election transactions) or
otherwise contemplates the acquisition of Common Stock Beneficially Owned by
each such holder for the same consideration (which shall include, without
limitation, cash and stock election transactions); provided that the
decision by certain holders to rollover their Common Stock shall not exclude
such a transaction from being considered a Buyout Transaction.
Bylaws: shall
mean the Amended and Restated Bylaws of the Company, as amended from
time.
Bylaws
Amendment: shall mean the adoption of the amended and restated
bylaws of the Company, substantially in the form set forth as Exhibit
H.
Capitalization
Proposal: shall mean an amendment to the Certificate of
Incorporation, through the Charter Amendment, which (a) effects the Reverse
Stock Split and (b) increases the authorized numbers of shares of Common Stock,
after giving effect to the Reverse Stock Split, to the Authorized Common Stock
Number.
Certificate of
Conversion: shall have the meaning set forth in Section
6.1(j).
Certificate of
Designation: shall mean either the Series A-1 Certificate of
Designation or the Series A-2 Certificate of Designation, as
applicable.
Certificate of
Elimination: shall mean a certificate of elimination,
substantially in the form attached as Exhibit
I.
Certificate of
Incorporation: shall mean the Amended and Restated Certificate
of Incorporation of the Company, as amended from time.
Change of Board
Recommendation: shall have the meaning set forth in Section
5.7(c)(iii).
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Change of
Control: shall mean the consummation of any transaction or
series of related transactions involving (i) any purchase or acquisition
(whether by way of tender offer, exchange offer, merger, consolidation,
amalgamation, scheme or arrangement, acquisition, business combination or
similar transaction or otherwise) by any Acquiring Person of any of (A)
securities representing a majority of the outstanding voting power of the
Company entitled to elect the Board or (B) the majority of the outstanding
shares of Common Stock, (ii) any sale, lease, exchange, transfer, exclusive
license or disposition of all or substantially all of the assets of the Company
and its Subsidiaries, taken together as a whole, to an Acquiring Person, (iii)
any merger, consolidation, amalgamation, scheme or arrangement, acquisition,
business combination or similar transaction in which the holders of Voting
Securities of the Company immediately prior to the transaction, as a group, do
not hold securities representing a majority of the outstanding voting power
entitled to elect the board of directors of the surviving entity in such merger,
consolidation, amalgamation, scheme or arrangement, acquisition, business
combination or similar transaction or (iv) a liquidation, dissolution or winding
up of the Company.
Change of Control
Notice: shall have the meaning set forth in Section
2.5(b).
Charter Amendment:
shall mean an amendment to the Certificate of Incorporation, substantially in
the form of Exhibit
J.
Closing: shall
mean the First Closing, Second Closing, any Series A-1 Additional Investment
Closing, the Series A-2 Subsequent Investment Closing, any Series A-1 Annex I
Additional Investment Closing or the Series A-1 Annex I Subsequent Investment
Closing.
Closing
Date: shall mean the First Closing Date, Second Closing Date,
any Series A-1 Additional Investment Closing Date, the Series A-1 Subsequent
Investment Closing Date, any Series A-1 Annex I Additional Investment Closing
Date or the Series A-1 Annex I Subsequent Investment Closing Date.
Closing
Price: shall mean, with respect to the Common Stock (or other
relevant capital stock or equity interest) on any date of determination, the
closing sale price or, if no closing sale price is reported, the last reported
sale price of the shares of the Common Stock (or other relevant capital stock or
equity interest) on the Approved Market on which such Common Stock trades on
such date. If the Common Stock (or other relevant capital stock or
equity interest) is not traded on an Approved Market on any date of
determination, the Closing Price of the Common Stock (or other relevant capital
stock or equity interest) on such date of determination means the closing sale
price as reported in the composite transactions for the principal U.S. national
or regional securities exchange on which the Common Stock (or other relevant
capital stock or equity interest) is so listed or quoted, or, if no closing sale
price is reported, the last reported sale price on the principal U.S. national
or regional securities exchange on which the Common Stock (or other relevant
capital stock or equity interest) is so listed or quoted, or if the Common Stock
(or other relevant capital stock or equity interest) is not so listed or quoted
on a U.S. national or regional securities exchange, the last quoted bid price
for the Common Stock (or other relevant capital stock or equity interest) in the
over-the-counter market as reported by Pink Sheets LLC or similar organization,
or, if that bid price is not available, the market price of the Common Stock (or
other relevant capital stock or equity interest) on that date as determined in
good faith by the Board.
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Code: shall
mean the Internal Revenue Code of 1986, as amended, and the Treasury Regulations
promulgated thereunder.
Commitment and Commitments: shall
have the meaning set forth in Section
3.12.
Common
Stock: shall have the meaning set forth in Section
1.
Company: shall
have the meaning set forth in the Preamble.
Company Bank
Account: shall have the meaning set forth in Section
2.1.
Company Benefit
Plans: shall have the meaning set forth in Section
3.13(b).
Company Disclosure
Letter: shall have the meaning set forth in the first
paragraph of Section
3.
Company Intellectual
Property: shall have the meaning set forth in Section
3.16(b).
Company
Products: shall mean the following product candidates of the
Company: (i) Marqibo® (vincristine sulfate liposome injection, OPTISOME™), (ii)
Alocrest™ (vinorelbine liposomes injection, OPTISOME™), (iii) Brakiva™
(topotecan liposomes injection, OPTISOME™) and (iv) Menadione Topical
Lotion.
Company SEC
Reports: shall have the meaning set forth in Section
3.7(a).
Confidentiality
Agreement: shall mean that certain Confidentiality Agreement
by and between the Company and the WP Purchasers, dated as of January 26,
2010.
Contingent
Obligation: shall mean, as to any Person, any direct or indirect
liability, contingent or otherwise, of that person with respect to any
indebtedness, lease, dividend or other obligation of another person if the
primary purpose or intent of the person incurring such liability, or the primary
effect thereof, is to provide assurance to the obligee of such liability that
such liability will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such liability will be
protected (in whole or in part) against loss with respect thereto.
Contract: shall
mean any agreement, contract, commitment, understanding, arrangement,
restriction or other instrument, whether oral or written, to which the Company
or any of its Subsidiaries is a party, which includes any rights or obligations
thereof, or which otherwise relates to or affects any of their respective
assets, including, without limitation,
any indenture, lease, mortgage, deed of trust, loan, credit or security
agreement, note or other evidence of indebtedness, guaranty, stockholders
agreement, license, joint venture agreement, distribution agreement, or
employment, severance or consulting agreement.
Conversion
Shares: shall mean the Series A-1 Conversion Shares and the
Series A-2 Conversion Shares.
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Deerfield Loan
Agreement: shall have the meaning set forth in Section
3.21.
Deerfield Participation
Right Termination Event: shall mean the earliest to occur of (i) one or
more Deerfield Purchasers providing written notice to the WP Purchasers and the
Company that the Deerfield Purchasers will not participate for the full amount
of Deerfield Participation Shares in an Additional or Subsequent Issuance; or
(ii) the Deerfield Purchasers failing to purchase all of the applicable
Deerfield Participation Shares for the applicable Deerfield Participation
Purchase Price on the applicable Closing Date for such purchase (including the
failure of one or more Deerfield Purchasers to fund all of their applicable
portion of the Deerfield Participation Purchase Price).
Deerfield Participation
Right: shall have the meaning set forth in Section
2.6(a).
Deerfield Participation
Shares: shall have the meaning set forth in Section
2.6(a).
Deerfield Termination
Date: shall have the meaning set forth in Section
2.6(c).
Deerfield Private
Design: shall have the meaning set forth in the
Preamble.
Deerfield Private Design
International: shall have the meaning set forth in the
Preamble.
Deerfield Pro Rata
Portion: shall mean 10%.
Deerfield Purchaser
and Deerfield
Purchasers: shall have the respective meanings set forth in
the Preamble.
Deerfield Purchaser
Group: shall mean Deerfield Private Design Fund, L.P.,
Deerfield Private Design International, L.P., Deerfield Special Situation Fund,
L.P., and Deerfield Special Situations Fund International Limited, and any
Affiliate of any of the foregoing other than any “portfolio company” (as such
term is customarily used among private equity investors) of any of the
foregoing.
Deerfield Special
Situation: shall have the meaning set forth in the
Preamble.
Deerfield Special Situations
Fund International: shall have the meaning set forth in the
Preamble.
Designated
Stock: shall have the meaning set forth in Section
5.4(b)(i).
DGCL: shall
mean the Delaware General Corporation Law.
Dividend Equivalent
Amount: shall have the meaning set forth in the Series A-1 Certificate of
Designation or Series A-2 Certificate of Designation, as
applicable.
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Environmental
Claims: shall mean, in respect of any Person, (i) any and all
administrative, regulatory or judicial actions, suits, orders, decrees, demands,
directives, claims, liens, proceedings or written notices of noncompliance,
liability or violation by any Governmental Authority, alleging potential
presence or Release of, or exposure to, any Hazardous Materials at any location,
whether or not owned, operated, leased or managed by such Person, or any
violation of Environmental Law or agreement pertaining to Hazardous Materials or
Environmental Laws or (ii) any and all indemnification, cost recovery,
compensation or injunctive relief resulting from the actual or alleged presence
or Release of, or exposure to, any Hazardous Materials or violation of
Environmental Laws.
Environmental
Laws: shall mean all federal, state, local and foreign laws
(including international conventions, protocols and treaties), common law,
rules, regulations, orders, decrees, judgments, binding agreements or
Environmental Permits issued, promulgated or entered into, by or with any
Governmental Authority, relating to pollution, Hazardous Materials, natural
resources or the protection, investigation or restoration of the environment as
in effect on the date of this Agreement.
Environmental
Permits: shall mean all permits, licenses, registrations and
other governmental authorizations required under applicable Environmental
Laws.
ERISA: shall
have the meaning set forth in Section
3.13(b).
ERISA
Affiliate: shall have the meaning set forth in Section
3.13(c)(2).
Exchange
Act: shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
Exempt Change of
Control: shall mean a Change of Control resulting solely from a Transfer
by the WP Purchaser Group of all of the Securities owned by the WP Purchaser
Group in a privately negotiated sale transaction between the WP Purchaser Group
and an unaffiliated third party and not in connection with a transaction that
would have otherwise resulted in a Change of Control.
Fairness
Opinion: shall have the meaning set forth in Section
6.1(g).
FDA: shall
mean the U.S. Food and Drug Administration.
First
Closing: shall have the meaning set forth in Section
2.4(a).
First Closing
Date: shall have the meaning set forth in Section
2.4(a).
First Tranche
Shares: shall have the meaning set forth in Section
2.1.
First Tranche Purchase
Price: shall have the meaning set forth in Section
2.1.
Fully Diluted
Basis: means all outstanding shares of the Common Stock
assuming the exercise of all outstanding stock, warrants, rights, calls, options
or other securities exchangeable or exercisable for, or convertible into, shares
of Common Stock without regard to any restrictions or conditions with respect to
the exercisability thereof, including all Conversion Shares, provided that,
notwithstanding the foregoing, Fully Diluted Basis shall not include any
Conversion Shares that are subject to limitations on issuance as set forth in
the applicable Certificate of Designation.
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GAAP: shall
have the meaning set forth in Section
3.7(b).
Governmental
Authority: shall mean any governmental department, commission,
board, bureau, agency, court or other instrumentality, whether foreign or
domestic, of any country, nation, republic, federation or similar entity or any
state, county parish or municipality, jurisdiction or other political
subdivision thereof or any self-regulatory organization.
Hazardous
Materials: shall mean (i) any substance that is listed,
classified or regulated under any Environmental Laws; (ii) any petroleum product
or by-product, asbestos-containing material, lead-containing paint or plumbing,
polychlorinated biphenyls, radioactive material, molds, or radon; or (iii) any
other substance that is the subject of regulatory action, or that could give
rise to liability, under any Environmental Laws.
HSR
Act: shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended, and the rules and regulations promulgated
thereunder.
Indemnification
Agreement: shall mean an indemnification agreement between the
Company and a director of the Company, substantially in the form of Exhibit
K.
Indebtedness: shall
mean, without duplication, (A) all indebtedness for borrowed money, (B) all
obligations issued, undertaken or assumed as the deferred purchase price of
property or services, including, without limitation, “capital leases” in
accordance with GAAP (other than trade payables entered into in the ordinary
course of business), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with GAAP, consistently
applied for the periods covered thereby, is classified as a capital lease, (G)
all indebtedness referred to in clauses (A) through (F) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in any property or assets
(including accounts and contract rights) owned by any person, even though the
person which owns such assets or property has not assumed or become liable for
the payment of such indebtedness, and (H) all Contingent Obligations in respect
of indebtedness or obligations of others of the kinds referred to in clauses (A)
through (G) above.
Indemnified Party:
shall have the meaning set forth in Section
5.6(a).
Indemnified
Parties: shall have the meaning set forth in Section
5.6(a).
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Independent
Director: shall mean an individual who, as a member of the
Board following the Closing Date, is not a WP Purchaser Designee.
Insolvency Event:
shall mean any of the following (a) the Company or any of its Subsidiaries files
a petition under any chapter of title 11 of the United States Code (the “Bankruptcy Code”) or
any other similar law of any jurisdiction affecting creditors’ rights; makes an
assignment for the benefit of its creditors; or commences a proceeding for the
appointment of a receiver, trustee, liquidator, custodian or conservator of
itself or of the whole or substantially all of its property; (b) a petition is
filed against the Company or any of its Subsidiaries under any chapter of the
Bankruptcy Code or any other similar law of any jurisdiction affecting
creditors’ rights or for the appointment of a receiver, trustee, liquidator,
custodian or conservator of the Company or any of its Subsidiaries or of the
whole or substantially all of its or their property and such petition or the
related proceeding remains undismissed for a period of 30 days; or the Company
or any of its Subsidiaries by any act indicates its consent to, approval of or
acquiescence in any such petition or proceeding; (c) a court of competent
jurisdiction enters an order for relief against the Company or any of its
Subsidiaries under any chapter of the Bankruptcy Code or any other similar law
of any jurisdiction affecting creditors’ rights or enters an order, judgment or
decree appointing or authorizing a receiver, trustee, liquidator, custodian or
conservator of the Company or any of its Subsidiaries or of the whole or
substantially all of its or their property; or a court of competent jurisdiction
or a receiver, trustee, liquidator, custodian or conservator, under the
provisions of any law for the relief or aid of debtors, assumes custody or
control or takes possession of the Company, any of its Subsidiaries or of the
whole or substantially all of the property of the Company or any of its
Subsidiaries; or (d) the Company or any of its Subsidiaries admits in writing
its inability, or is generally unable, to pay its debts as such debts become
due.
Intellectual
Property: shall mean (i) trademarks, service marks, brand
names, certification marks, trade dress, domain names and other indications of
origin, the goodwill associated with the foregoing and registrations in any
jurisdiction of, and applications in any jurisdiction to register, the
foregoing, including any extension, modification or renewal of any such
registration or application, (ii) inventions, processes, improvements,
discoveries, ideas, know-how, research and development, formula methodology, and
technology, whether patentable or not, in any jurisdiction, patents,
applications for patents (including divisions, continuations, continuations in
part and renewal applications), and any renewals, extensions or reissues
thereof, in any jurisdiction, (iii) trade secrets, including confidential
information and the right in any jurisdiction to limit the use or disclosure
thereof, (iv) writings and other works, whether copyrightable or not, in any
jurisdiction, and any and all copyright rights, whether registered or not, and
registrations or applications for registration of copyrights in any
jurisdiction, and any renewals or extensions thereof, (v) moral rights, database
rights, design rights, industrial property rights, publicity rights and privacy
rights, (vi) Internet Web sites, domain names and applications and registrations
pertaining thereto and all intellectual property used in connection therewith;
(vii) rights under all agreements relating to the foregoing, (viii) books and
records relating to the foregoing, and (ix) any similar intellectual property or
proprietary rights.
Intervening
Event: shall have the meaning set forth in Section
5.7(c)(iii).
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Liens: shall
mean any charge, claim, community property interest, condition, equitable
interest, lien, mortgage, option, pledge, security interest, indenture,
hypothecation, deed of trust, right of first refusal, easement, security
agreement, or restriction of any kind, including any restriction or limitation
on use, voting, transfer, receipt of income, or exercise of any other attribute
of ownership.
Losses: shall
have the meaning set forth in Section
5.6(a).
Market
Transfers: shall mean sales effected through a securities
exchange or national quotation system or through a broker, dealer or other
market maker, in a manner in which the identity of the purchaser, other than the
broker, dealer, or market maker through which such sale is being effected, has
not been designated by a Purchaser Group and is effected in a manner through
which the identity of the purchaser cannot or would not customarily be available
to such Purchaser Group as the seller.
Marketing Approval
Date: shall mean the date the WP Purchasers first receive notice in
writing from the Company that the Company has first received written marketing
approval in the United States (which for the purposes of clarity shall include
“accelerated approval”) from the FDA for a New Drug Application submitted for
any of the Company Products.
Material Adverse
Effect: shall mean any effect, change, event, occurrence,
condition, circumstance or development (each, a “Change,” and
collectively, “Changes”) that
individually or in the aggregate (a) was or would reasonably be expected to be
materially adverse to the business, condition (financial or otherwise), assets,
liabilities, properties or results of operations of the Company and its
Subsidiaries, taken as a whole, provided, however, that in determining whether a
Material Adverse Effect has occurred under clause (a), any Change shall be
excluded to the extent that it occurs after the date of this Agreement and
results from (i) changes in GAAP, (ii) general changes in the economy or the
industries in which the Company and its Subsidiaries operate, (iii) any acts of
war, terrorism, insurrection or civil disobedience, (iv) any change in law
applicable to the Company or Subsidiaries (not including any changes in
healthcare laws, rules and regulations), (v) actions or omissions of the Company
expressly required by the terms of this Agreement or taken with the prior
written consent of the WP Purchasers, (vi) changes in the market price or
trading volumes of the Common Stock or the Company's other securities (it being
understood that this clause (vi) shall not prevent a party from asserting that
any Change that may have contributed to such change contemplated in this clause
(vi) constitutes or contributes to a Material Adverse Effect) or (vii) the
failure of the Company to meet any internal or public projections, forecasts,
estimates or guidance (but not the underlying causes of such failure), in each
case, to the extent that such circumstances, events, changes, developments or
effects described in any of the foregoing clauses (i), (ii), (iii) or (iv) do
not have a disproportionate effect on the Company and its Subsidiaries, taken as
a whole (relative to other participants in the industries, markets or geographic
areas in which the Company and its Subsidiaries compete); or (b) would prevent
or materially delay the consummation of the transactions contemplated by this
Agreement and the Transaction Documents.
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Material Closing Date
Contracts: shall have the meaning set forth in Section
3.15(b).
Material
Licenses: shall have the meaning set forth in Section
3.9(b).
Material Signing Date
Contracts: shall have the meaning set forth in Section
3.15(a).
Maximum Series A-1
Additional Investment Shares: shall have the meaning set forth
in Section
2.2(b).
Maximum Series A-1 Annex I
Additional Investment Shares: shall have the meaning set forth
in Section
2.3(a).
Maximum Series A-1 Annex I
Subsequent Investment Shares: shall have the meaning set forth
in Section
2.3(b).
Minimum Series A-1
Additional Investment Shares: shall have the meaning set forth
in Section
2.2(b).
Minimum Series A-1 Annex I
Additional Investment Shares: shall have the meaning set forth
in Section
2.3(a).
Minimum Series A-1 Annex I
Subsequent Investment Shares: shall have the meaning set forth
in Section
2.3(b).
New
Stock: shall have the meaning set forth in the definition of
Qualified Equity Offering.
Organizational
Documents: shall mean the Certificate of Incorporation and the
Bylaws.
Permitted
Transferee: shall have the meaning set forth in Section
5.23.
Permitted Transfers:
shall mean Transfers (i) to other members of a Purchaser’s Purchaser Group who
agree in writing to be bound by the terms of Section 5.1 and Section 5.2 of this
Agreement, (ii) in connection with a bona fide pledge to, or similar arrangement
in connection with a bona fide borrowing from, a financial institution, (iii) in
a transaction approved by a majority of the directors of the Company who qualify
as Independent Directors (such approval not to be unreasonably withheld or
delayed), (iv) following the date of a material violation by the Company of any
term of or condition set forth herein, where the Company does not cure such
violation within thirty (30) days after written notice of such breach from one
or more of the Purchasers who is actually adversely affected by such breach, (v)
to the Company pursuant to an exercise of the redemption rights set forth in the
applicable Certificate of Designation, (vi) following the Stockholder Approval
Outside Date if the Company fails to obtain the Stockholder Approval prior to
the Stockholder Approval Outside Date, (vii) that are Market Transfers, or
(viii) Transfers between the WP Purchasers, on the one hand, and the Deerfield
Purchasers, on the other hand.
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Person: shall
mean an individual, corporation, general partnership, limited partnership,
limited liability partnership, joint venture, association, joint-stock company,
trust, limited liability company, unincorporated organization, other entity or
government or any agency or political subdivision thereof.
Private
Placement: shall have the meaning set forth in Section
5.4(b)(ii).
Proposed Alternate
Financing: shall have the meaning set forth in Section
5.22(a).
Proposed Alternate Financing
Certificate: shall have the meaning set forth in Section
5.22(a)(i).
Proxy
Statement: shall have the meaning set forth in Section
5.7(c)(i).
Purchaser and Purchasers: shall
have the meaning set forth in the Preamble.
Purchaser
Affiliate: means an Affiliate of a Purchaser other than any
“portfolio company” (as such term is customarily used among private equity
investors) of such Purchaser.
Purchaser
Group: shall mean either the Deerfield Purchaser Group or the
WP Purchaser Group, as applicable.
Purchaser Percentage
Interest: shall mean, with respect to a Purchaser, the
percentage of Total Voting Power, determined on the basis of the number of
Voting Securities on a Fully Diluted Basis, that is Beneficially Owned by the
such Purchaser’s Purchaser Group.
Qualified Equity
Offering: shall mean a public or nonpublic offering by the
Company of Common Stock or securities convertible into or exchangeable for
Common Stock (or securities convertible into or exercisable for such securities)
(collectively, “New
Stock”) solely for cash and not pursuant to a Special Registration; provided, however, that none of
the following offerings shall constitute a Qualified Equity
Offering: (i) any offering pursuant to any stock purchase plan, stock
ownership plan, stock option plan or other similar plan where stock is being
issued or offered to a trust, other entity or otherwise, to or for the benefit
of any employees, officers, consultants, directors, customers, lenders or
vendors of the Company, (ii) any offering made as a consideration for the
consummation of, and not primarily for the purpose of financing, a merger or
acquisition, a partnership or joint venture or strategic alliance or investment
by the Company or a similar non-capital-raising transaction, (iii) the issuance
of Common Stock on conversion of any of the Securities, or (iv) the issuance of
Common Stock in connection with the conversion or exercise of options or
warrants of the Company outstanding on the date hereof (as disclosed in Section 3.3(a)) or
issued in accordance with Section
5.4.
Reference SEC
Reports: Company SEC Reports filed with or furnished to the
SEC on or after January 1, 2010 and prior to the date hereof and publicly
available (without giving effect to any amendment to any such Company SEC
Reports filed on or after the date hereof and excluding (i) documents filed as
exhibits thereto, (ii) documents incorporated by reference therein and (iii) any
disclosures that constitute general cautionary, predictive or forward-looking
statements set forth in any section of a Company SEC Report entitled “Risk
Factors” or “Forward-Looking Statements” or any other sections of such
filings).
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Registration Rights
Agreement: shall have the meaning set forth in Section
6.1(i).
Release: shall mean
any actual or threatened release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
environment.
Representatives: shall
mean the officers, directors, agents, members, partners, employees or Affiliates
of a Person.
Resigning Directors:
shall mean Xxxxxxx Xxxxxx and Xxxxx X. Xxxxxxxxx.
Reverse Stock Split:
shall mean a reverse stock split, accomplished through the Charter Amendment,
pursuant to which each share of Common Stock outstanding immediately prior to
the amendment, shall be automatically converted into that number of shares of
Common Stock (or a fraction thereof) determined by multiplying one (1) by the
Reverse Stock Split Ratio.
Reverse Stock Split
Ratio: shall mean the ratio pursuant to which Common Stock
shall be converted in connection with the Reverse Stock Split, which shall be
determined in accordance with Section
5.21(b).
ROFO Negotiation
Period: shall have the meaning set forth in Section
5.19.
ROFO Offer: shall
have the meaning set forth in Section
5.19.
Rule
16b-3: shall have the meaning set forth in Section
5.10(a).
Rule
144A: shall mean Rule 144A under the Securities Act or any
successor or similar rule as may be enacted by the SEC from time to time, as in
effect from time to time.
Xxxxxxxx-Xxxxx
Act: shall mean the Xxxxxxxx-Xxxxx Act of 2002, as amended,
and the rules and regulations promulgated thereunder.
SEC: shall
mean the Securities and Exchange Commission.
Second
Closing: shall have the meaning set forth in Section
2.4(b).
Second Closing
Date: shall have the meaning set forth in Section
2.4(b).
Section 16(b) Extension
Period: shall have the meaning set forth in Section
5.10(b).
Section 16(b)
Period: shall have the meaning set forth by Section
5.10(b).
Securities: shall
mean the shares of Series A Preferred (including the Conversion Shares) issued
or issuable to the Purchasers pursuant to this Agreement.
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Securities
Act: shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
Series A Preferred:
shall have the meaning set forth in Section
1.
Series A-1 Additional
Investment Closing: shall have the meaning set forth in Section
2.4(c).
Series A-1 Additional
Investment Closing Date: shall have the meaning set forth
in Section
2.4(c).
Series A-1 Additional
Investment Notice: shall have the meaning set forth in Section
2.4(c).
Series A-1 Additional
Investment Purchase Price: shall have the meaning set forth in
Section
2.2(b).
Series A-1 Additional
Investment Shares: shall have the meaning set forth in Section
2.2(b).
Series A-1 Additional
Investment Tranche: shall have the meaning set forth in Section
2.2(b).
Series A-1 Annex I
Additional Investment Closing: shall have the meaning set
forth in Section
2.4(e).
Series A-1 Annex I
Additional Investment Closing Date: shall have the meaning set
forth in Section
2.4(e).
Series A-1 Annex I
Additional Investment Notice: shall have the meaning set forth
in Section
2.4(e).
Series A-1 Annex I
Additional Investment Purchase Price: shall have the meaning
set forth in Section
2.3(a).
Series A-1 Annex I
Additional Investment Shares: shall have the meaning set forth
in Section
2.3(a).
Series A-1 Annex I
Additional Investment Tranche: shall have the meaning set
forth in Section
2.3(a).
Series A-1 Annex I
Subsequent Investment Closing: shall have the meaning set
forth in Section
2.4(f).
Series A-1 Annex I
Subsequent Investment Closing Date: shall have the meaning set
forth in Section
2.4(f).
Series A-1 Annex I
Subsequent Investment Notice: shall have the meaning set forth
in Section
2.4(f).
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Series A-1 Annex I
Subsequent Investment Purchase Price: shall have the meaning
set forth in Section
2.3(b).
Series A-1 Annex I
Subsequent Investment Shares: shall have the meaning set forth
in Section
2.3(b).
Series A-1 Annex I
Subsequent Investment Tranche: shall have the meaning set
forth in Section
2.3(b).
Series A-1 Certificate of
Designation: shall have the meaning set forth in Section
1.
Series A-1 Conversion
Conditions: shall mean, only to the extent applicable at the time of
determination, those conditions to the conversion of Series A-1 Preferred into
Conversion Shares as set forth in Annex I of the Series A-1 Certificate of
Designation.
Series A-1 Conversion
Shares: shall have the meaning set forth in Section
1.
Series A-1 Preferred:
shall have the meaning set forth in Section
1.
Series A-2 Certificate of
Designation: shall have the meaning set forth in Section
1.
Series A-2 Conversion
Shares: shall have the meaning set forth in Section
1.
Series A-2 Preferred:
shall have the meaning set forth in Section
1.
Series A-2 Subsequent
Investment Closing: shall have the meaning set forth in Section
2.4(d).
Series A-2 Subsequent
Investment Closing Date: shall have the meaning set forth in
Section
2.4(d).
Series A-2 Subsequent
Investment Notice: shall have the meaning set forth in Section
2.4(d).
Series A-2 Subsequent
Investment Purchase Price: shall have the meaning set forth in
Section
2.2(c).
Series A-2 Subsequent
Investment Right: shall have the meaning set forth in Section
2.2(c).
Series A-2 Subsequent
Investment Shares: shall have the meaning set forth in Section
2.4(d).
Shares: shall
mean shares of the Series A-1 Preferred and Series A-2
Preferred.
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Special
Registration: shall mean the registration of (i) equity
securities and/or options or other rights in respect thereof solely registered
on Form S-4 or Form S-8 (or successor form) or (ii) shares of equity securities
and/or options or other rights in respect thereof to be offered to directors,
members of management, employees, consultants, customers, lenders or vendors of
the Company or its direct or indirect Subsidiaries or in connection with
dividend reinvestment plans.
Standstill Termination
Date: shall have the meaning set forth in Section
5.2.
Stockholder Approval:
shall mean the affirmative vote of holders of a majority of the outstanding
shares of Common Stock entitled to vote, either at a meeting of stockholders of
the Company validly called and at which a quorum is present or by written
consent, approving both (a) the Capitalization Proposal and (b) the 242(b)(2)
Proposal, in each case in accordance with the relevant provisions of the
DGCL.
Stockholder Approval Outside
Date: shall mean December 7, 2010.
Stockholder Meeting:
shall mean the special meeting of the holders of Common Stock to be called by
the Company for the purpose of obtaining the Stockholder Approval.
Stockholder
Proposals: shall mean the Capitalization Proposal and the
242(b)(2) Proposal.
Subsidiary: shall
mean a partnership, joint-stock company, corporation, limited liability company,
trust, unincorporated organization or other entity of which a Person owns,
directly or indirectly, more than 50% of the stock or other interests the holder
of which is generally entitled to vote for the election of the board of
directors or other governing body of such entity.
Takeover
Provisions: shall have the meaning set forth in Section
5.9.
Total Voting Power:
shall mean at any time the total combined voting power in the general election
of directors of all the Voting Securities then outstanding.
Trading Day: shall
mean a day on which the shares of Common Stock (or other relevant capital stock
or equity interest): (i) are not suspended from trading on any
national or regional securities exchange or association or over-the-counter
market at the close of business; and (ii) have traded at least once on the
national or regional securities exchange or association or over-the-counter
market that is the primary market for the trading of the Common Stock (or other
relevant capital stock or equity interest).
Transaction
Documents: shall mean the Registration Rights Agreement, the
Series A-1 Certificate of Designation, the Series A-2 Certificate of
Designation, the Voting Agreement, the Bylaws Amendment, the Certificate of
Elimination and the Charter Amendment.
Transfer: shall
mean any sale, assignment, pledge, transfer, hypothecation, short sale, grant
any option for the purchase of, or other disposition.
Transfer Restriction Outside
Date: shall have the meaning set forth in Section
5.1(b).
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VCOC: shall have the
meaning set forth in Section
5.14.
Voting
Securities: shall mean, at any time, shares of any class of
equity securities of the Company which are then entitled to vote generally in
the election of directors.
WP Change of Control
Election: shall have the meaning set forth in Section
2.5(b).
WP
Partners: shall have the meaning set forth in the
Preamble.
WP Purchaser and
WP Purchasers:
shall have the meaning set forth in the Preamble.
WP Purchaser
Group: shall mean Warburg Pincus Private Equity X, L.P.,
Warburg Pincus X Partners, L.P., Warburg Pincus LLC and any Affiliate of any of
the foregoing other than any “portfolio company” (as such term is customarily
used among private equity investors) of any of the foregoing.
WP Purchaser
Designee(s): shall have the meaning set forth in Section
5.16(a).
WPX: shall
have the meaning set forth in the Preamble.
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9.2.
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Accounting
Principles
|
Where the
character or amount of any asset or amount of any asset or liability or item of
income or expense is required to be determined or any consolidation or other
accounting computation is required to be made for the purposes of this
Agreement, this shall be done in accordance with GAAP at the time in effect, to
the extent applicable, except where such principles are inconsistent with the
requirements of this Agreement.
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9.3.
|
Governing
Law
|
This
Agreement shall be governed by and construed in accordance with the laws of the
State of Delaware without giving effect to any contrary result otherwise
required by conflict or choice of law rules.
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9.4.
|
Paragraph and Section
Headings
|
The
headings of the sections and subsections of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part
thereof.
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SECTION
10.
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MISCELLANEOUS
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10.1.
|
Notices
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(a) All
communications under this Agreement shall be in writing and shall be delivered
by hand or facsimile or mailed by overnight courier or by registered mail or
certified mail, postage prepaid:
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(1) if
to WP Purchasers at: c/o Warburg Pincus & Co., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000 (facsimile: (000) 000-0000),
Attention: Xxxxxxxx Xxxx, or at such other address or facsimile
number as the WP Purchasers may have furnished the Company and the Deerfield
Purchasers in writing, with a copy to Xxxxxxx Xxxx & Xxxxxxxxx LLP, 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (facsimile: (000) 000-0000), Attention:
Xxxxxx X. Xxxxxxx, Esq./Xxxxxx X. Xxxxxxx, Esq.;
(2) if
to Deerfield Purchasers at: Deerfield Management Company, L.P. Series
C, 000 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, XX 00000 (facsimile: (000) 000-0000),
Attention: Xxxxx X. Xxxxx, or at such other address or facsimile
number as the Deerfield Purchasers may have furnished the Company and the WP
Purchasers in writing, with a copy to with a copy to Xxxxxx Xxxxxx Xxxxxxxx LLP,
000 Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000 (facsimile: (000) 000-0000), Attention:
Xxxxxx X. Xxxxxx, Esq.; and
(3) if
to the Company, at: 0000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxx Xxx Xxxxxxxxx, XX
00000 (facsimile: (000) 000-0000), Attention: Chief Executive
Officer, or at such other address or facsimile number as it may have furnished
the Purchasers in writing, with a copy to Xxxxxxxxxx & Xxxxx, P.A., 000
Xxxxx 0xx Xxxxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxxx 00000
(facsimile: (000) 000-0000), Attention: Xxxxxxxxxxx X.
Xxxxxx.
(b) Any
notice so addressed shall be deemed to be given: if delivered by hand
or facsimile, on the date of such delivery; if delivered by a national overnight
courier, on the first Business Day following the date placed with such courier
for overnight delivery; and if mailed by registered or certified mail, on the
third Business Day after the date of such mailing.
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10.2.
|
Expenses and
Taxes
|
(a)
At each Closing, the Company shall reimburse the WP Purchasers for the
reasonable fees and disbursements incurred by the WP Purchasers in connection
with transactions contemplated hereby and the Transaction Documents, including
fees and disbursements of legal counsel (including the fees and expenses of
Xxxxxxx Xxxx & Xxxxxxxxx LLP), accountants, advisors and consultants, and
such other fees and expenses, including diligence fees and expenses, incurred by
the WP Purchaser Group in connection with (i) the negotiation and execution and
delivery of this Agreement and the Transaction Documents and any instrument
delivered in connection therewith as well as any amendments, modifications or
waivers thereto, (ii) the WP Purchaser Group’s due diligence investigation and
negotiation of a term sheet, (iii) the transactions contemplated by this
Agreement and the other agreements contemplated hereby, including the
Transaction Documents, (iv) all fees and expenses related compliance with
Antitrust Regulations, including any filing fees required by such Antitrust
Regulations, and (v) any fees associated with listing any of the Securities on a
securities exchange. Reimbursement of such fees, disbursements and expenses
shall be made by wire transfer of immediately available funds to an account or
accounts designated by the WP Purchaser, set forth in a statement delivered to
the Company on or prior to the applicable Closing Date, and thereafter the
Company will pay, promptly upon receipt of a supplemental statement therefor,
such additional reasonable fees, disbursements and expenses, if any, as may be
incurred by the WP Purchaser Group in connection with such transactions. All
such fees and disbursements of the WP Purchasers submitted for reimbursement
shall be accompanied by invoices or other reasonable documentation evidencing
such items; provided, however, with respect
to reimbursement of expenses for legal counsel, the “reasonable documentation”
need not include any attorney time descriptions of work
performed.
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(b) The
Company will pay, and save and hold the Purchasers harmless from any and all
liabilities (including interest and penalties) with respect to, or resulting
from any delay or failure in paying, stamp and other taxes (other than income
taxes), if any, which may be payable or determined to be payable on the
execution and delivery or acquisition of the Securities.
|
|
10.3.
|
Reproduction of
Documents
|
This
Agreement and the Transaction Documents and all documents relating thereto,
including,
without
limitation, (a) consents, waivers and modifications which may hereafter
be executed, (b) documents received by a Purchaser on a Closing Date (except for
certificates evidencing the Shares themselves), and (c) financial statements,
certificates and other information previously or hereafter furnished to the
Purchaser, may be reproduced by the Purchaser by any photographic, photostatic,
microfilm, micro-card, miniature photographic or other similar process and the
Purchaser may destroy any original document so reproduced. All
parties hereto agree and stipulate that any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative
proceeding (whether or not the original is in existence and whether or not such
reproduction was made by a Purchaser in the regular course of business) and that
any enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence.
|
|
10.4.
|
Survival
|
Notwithstanding
any termination of the parties’ obligation to consummate the transactions
contemplated hereby, all other terms of this Agreement shall remain in full
force and effect after each Closing to the extent such provisions apply
following such Closing. The representations, warranties and covenants made by a
Purchaser and the Company herein or in any certificate or other instrument
delivered by a Purchaser or the Company under this Agreement shall be considered
to have been relied upon by the Company or such Purchasers, as the case may be,
and shall survive delivery to such Purchaser of any of the Securities, or
payment to the Company for such Securities (if any), regardless of any
investigation made by the Company or such Purchaser, as the case may be, or on
the Company’s or such Purchaser’s behalf until eighteen (18) months after each
Closing; provided, however, that the
representations and warranties set forth in Section 3.1 (Corporate
Organization), Section 3.2 (No Subsidiaries), Section 3.3 (Capitalization),
Section 3.4 (Authorization), Section 3.5 (No Conflicts), Section 3.6
(Approvals), Section 3.7 (Reports and Financial Statements) and Section 3.25
(Investment Banking) shall survive each Closing until sixty (60) days following
the expiration of any applicable statute of limitations (including any
extensions thereof). Any claims under this Agreement with respect to a breach of
a representation and warranty must be asserted by written notice within the
applicable survival period contemplated by this Section 10.4, and if such a
notice is given, the survival period for such representation and warranty shall
continue until the claim is fully resolved. All statements in any such
certificate or other instrument delivered by the Company shall constitute
warranties and representations by the Company hereunder. Notwithstanding any
termination of the parties’ obligation to consummate the transactions
contemplated hereby, all other terms of this Agreement shall remain in full
force and effect after each Closing to the extent such provisions apply
following such Closing.
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|
|
10.5.
|
Successors and
Assigns
|
This
Agreement shall inure to the benefit of and be binding upon the successors and
assigns of each of the parties. The Company may not assign its rights
or obligations hereunder without the prior written consent of the WP
Purchasers. A Purchaser may assign their respective rights and
obligations hereunder to any of members of its Purchaser Group. In
addition, the WP Purchasers may assign all, but not less than all, of their
rights and obligations hereunder to any Person at any time without the need to
any consent from the Company or any other Purchaser, provided that in
connection with any such assignment, the WP Purchaser Group shall Transfer any
Securities then owned by the WP Purchaser Group to such Person.
|
|
10.6.
|
Entire Agreement;
Amendment and Waiver
|
This
Agreement and the Transaction Documents and the other agreements contemplated
hereby and thereby constitute the entire understandings of the parties hereto
and supersede all prior agreements or understandings with respect to the subject
matter hereof among such parties. This Agreement may be amended, and
the observance of any term of this Agreement may be waived, with (and only with)
the written consent of the Company (to the extent approved by a majority of
Independent Directors) and the WP Purchasers, and, solely to the extent they are
materially and disproportionately adversely affected by such amendment relative
to the WP Purchasers, the Deerfield Purchasers; provided that the
consent of the Deerfield Purchasers shall not be required for any amendment of
this Agreement or any of the Transaction Documents from and after the date that
the Deerfield Purchasers’ Purchaser Percentage Interest is less than
10%.
|
|
10.7.
|
Severability
|
In the
event that any part or parts of this Agreement shall be held illegal or
unenforceable by any court or administrative body of competent jurisdiction,
such determination shall not affect the remaining provisions of this Agreement
which shall remain in full force and effect.
|
|
10.8.
|
Limitation on
Enforcement of Remedies
|
The
Company hereby agrees that it will not assert against the former, current, or
future general or limited partners, stockholders, managers, members, directors,
officers, Affiliates or agents of a Purchaser any claim it may have under this
Agreement by reason of any failure or alleged failure by such Purchaser to meet
its obligations hereunder.
- 75
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|
|
10.9.
|
Lost Certificates
Evidencing Shares; Exchange.
|
Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of any certificate evidencing any Securities
owned by a Purchaser and (in the case of loss, theft or destruction) of an
unsecured indemnity satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of such certificate, if mutilated, the Company will make and deliver in lieu of
such certificate a new certificate of like tenor and for the number of
securities evidenced by such certificate which remains
outstanding. Upon surrender of any certificate representing any
Securities, for exchange at the office of the Company, the Company at its
expense will cause to be issued in exchange therefor new certificates in such
denomination or denominations as may be requested for the same aggregate number
of Securities represented by the certificate so surrendered and registered as
such holder may request. The Company will also pay the cost of all
deliveries of certificates for such Securities to the office of a Purchaser
(including the cost of insurance against loss or theft in an amount satisfactory
to the holders) upon any exchange provided for in this Section 10.9.
Notwithstanding the foregoing, to the extent any third party engaged as transfer
agent for any of the Securities requires an indemnity bond in connection with
the issuance of any new or replacement certificate, such Purchaser will be
solely responsible for the costs thereof.
|
|
10.10.
|
Terms
Generally
|
The words
“hereby”, “herein”, “hereof”, “hereunder” and words of similar import refer to
this Agreement as a whole and not merely to the specific section, paragraph or
clause in which such word appears. All references herein to Articles
and Sections shall be deemed references to Articles and Sections of this
Agreement unless the context shall otherwise require. The words
“include”, “includes” and “including” shall be deemed to be followed by the
phrase “without limitation”. The definitions given for terms in Section 9.1 and
elsewhere in this Agreement shall apply equally to both the singular and plural
forms of the terms defined. Whenever the context may require, any
pronoun shall include the corresponding masculine, feminine and neuter
forms. References herein to any agreement or letter shall be deemed
references to such agreement or letter as it may be amended, restated or
otherwise revised from time to time.
|
|
10.11.
|
Draftsmanship
|
Each of
the parties hereto has been represented by its own counsel and acknowledges that
it has participated in the drafting of this Agreement and the Transaction
Documents, and any applicable rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not be applied
in connection with the construction or interpretation of this Agreement or the
Transaction Documents. Whenever required by the context hereof, the
singular number shall include the plural, and vice versa; the masculine gender
shall include the feminine and neuter genders; and the neuter gender shall
include the masculine and feminine genders.
- 76
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|
|
10.12.
|
Counterparts
|
This
Agreement may be executed in one or more counterparts (including by facsimile),
each of which shall be deemed an original and all of which together shall be
considered one and the same agreement.
|
|
10.13.
|
Several and Not
Joint
|
The
obligations of each Purchaser under this Agreement and the Transaction Documents
are several and not joint with the obligations of any other Purchaser, and no
Purchaser shall be responsible in any way for the performance of the obligations
of any other Purchaser under this Agreement or any Transaction
Document. The failure or waiver of performance under this Agreement
or any Transaction Document by any Purchaser shall not excuse performance by any
other Purchaser. Nothing contained herein or in any other Transaction
Document, and no action taken by any Purchaser pursuant hereto or thereto, shall
be deemed to constitute the Purchasers as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Purchasers
are in any way acting in concert or as a group with respect to such obligations
or the transactions contemplated by this Agreement or the Transaction
Documents. Each Purchaser shall be entitled to independently protect
and enforce its rights, including without limitation, the rights arising out of
this Agreement or out of the other Transaction Documents to which it is a party,
and it shall not be necessary for any other Purchaser to be joined as an
additional party in any proceeding for such purpose.
|
|
10.14.
|
Specific
Performance
|
The
parties acknowledge and agree that irreparable damage would result in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is
accordingly agreed that each party shall be entitled to an injunction or other
equitable relief, without the necessity of posting a bond, to prevent or cure
breaches of the provisions of this Agreement and to enforce specifically the
terms and provisions thereof, this being in addition to any other remedy to
which the parties may be entitled by law or equity.
|
|
10.15.
|
No
Recourse
|
(a) Notwithstanding
that each WP Purchaser is a partnership, (a) no recourse hereunder or under any
Transaction Document shall be had against any Related Party of a WP Purchaser or
any Related Party of any of the WP Purchaser Group’s Related Parties, whether by
the enforcement of any judgment or assessment or by any legal or equitable
proceeding, and (b) no personal liability whatsoever will attach to, be imposed
on or otherwise incurred by any Related Party of a WP Purchaser or any Related
Party of any of WP Purchaser Group’s Related Parties under this Agreement or any
other Transaction Document or for any claim based on, in respect of, or by
reason of such obligations hereunder or by their creation.
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(b) Notwithstanding
that each Deerfield Purchaser is a partnership, (a) no recourse hereunder or
under any Transaction Document shall be had against any Related Party of a
Deerfield Purchaser or any Related Party of any of the Deerfield Purchaser
Group’s Related Parties, whether by the enforcement of any judgment or
assessment or by any legal or equitable proceeding, and (b) no personal
liability whatsoever will attach to, be imposed on or otherwise incurred by any
Related Party of a Deerfield Purchaser or any Related Party of any of Deerfield
Purchaser Group’s Related Parties under this Agreement or any other Transaction
Document or for any claim based on, in respect of, or by reason of such
obligations hereunder or by their creation.
(c) As
used in this Section
10.15, a “Related Party” of a Person shall mean any former, current or
future controlling person, director, officer, employee, agent, general or
limited partner, manager, member, affiliate, stockholder, assignee or
representative of such Person or any of its successors or permitted assigns or
any former, current or future controlling person, director, officer, employee,
agent, general or limited partner, manager, member, affiliate, stockholder,
assignee or representative of any of the foregoing, other than the WP Purchasers
in the case of Section
10.15(a) or the Deerfield Purchasers in the case of Section
10.15(b).
[SIGNATURE
PAGE FOLLOWS]
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|
Very
truly yours,
|
|
|
HANA
BIOSCIENCES, INC.
|
|
|
By:
|
/s/ Xxxxxx X. Xxxxxxxx
|
|
Name:
Xxxxxx X. Xxxxxxxx
|
|
|
Title: President
& CEO
|
|
ACCEPTED
AND AGREED:
WARBURG
PINCUS PRIVATE EQUITY X, L.P.
By: Warburg
Pincus X L.P., its General Partner
By: Warburg
Pincus X LLC, its General Partner
By: Warburg
Pincus Partners LLC, its Sole Member
By: Warburg
Pincus & Co., its Managing Member
|
By:
|
|
|
Name: Xxxxxxxx
Xxxx
|
|
|
Title:
Partner
|
Resident
in: Delaware
Signature
Page to Investment Agreement
|
Very
truly yours,
|
|
|
HANA
BIOSCIENCES, INC.
|
|
|
By:
|
/s/ Xxxxxx X. Xxxxxxxx
|
|
Name:
Xxxxxx X. Xxxxxxxx
|
|
|
Title: President
& CEO
|
|
ACCEPTED
AND AGREED:
WARBURG
PINCUS X PARTNERS, L.P.
By: Warburg
Pincus X L.P., its General Partner
By: Warburg
Pincus X LLC, its General Partner
By: Warburg
Pincus Partners LLC, its Sole Member
By: Warburg
Pincus & Co., its Managing Member
|
By:
|
|
|
Name: Xxxxxxxx
Xxxx
|
|
|
Title:
Partner
|
Resident
in: Delaware
Signature
Page to Investment Agreement
|
Very
truly yours,
|
|
|
HANA
BIOSCIENCES, INC.
|
|
|
By:
|
/s/ Xxxxxx X.
Xxxxxxxx
|
|
Name:
Xxxxxx X. Xxxxxxxx
|
|
|
Title: President
& CEO
|
|
ACCEPTED
AND AGREED:
DEERFIELD
SPECIAL SITUATION FUND, L.P.
By: Deerfield
Capital, L.P., General Partner
By: X.X.
Xxxxx Capital, LLC, General Partner
|
By:
|
/s/ Xxxxx X. Xxxxx
|
|
Name:
Xxxxx X. Xxxxx
|
|
|
Title: President
|
Resident
in: Delaware
Signature
Page to Investment Agreement
|
Very
truly yours,
|
|
|
HANA
BIOSCIENCES, INC.
|
|
|
By:
|
/s/ Xxxxxx X.
Xxxxxxxx
|
|
Name:
Xxxxxx X. Xxxxxxxx
|
|
|
Title: President
& CEO
|
|
ACCEPTED
AND AGREED:
DEERFIELD
SPECIAL SITUATIONS FUND INTERNATIONAL LIMITED
|
By:
|
/s/ Xxxxx X. Xxxxx
|
|
Name:
Xxxxx X. Xxxxx
|
|
|
Title:
Director
|
Resident
in: British Virgin Islands
Signature
Page to Investment Agreement
|
Very
truly yours,
|
|
|
HANA
BIOSCIENCES, INC.
|
|
|
By:
|
/s/ Xxxxxx X.
Xxxxxxxx
|
|
Name:
Xxxxxx X. Xxxxxxxx
|
|
|
Title: President
& CEO
|
|
ACCEPTED
AND AGREED:
DEERFIELD
PRIVATE DESIGN FUND, L.P.
By: Deerfield
Capital, L.P., General Partner
By: X.X.
Xxxxx Capital, LLC, General Partner
|
By:
|
/s/ Xxxxx X. Xxxxx
|
|
Name:
Xxxxx X. Xxxxx
|
|
|
Title:
President
|
Resident
in: Delaware
Signature
Page to Investment Agreement
|
Very
truly yours,
|
|
|
HANA
BIOSCIENCES, INC.
|
|
|
By:
|
/s/ Xxxxxx X.
Xxxxxxxx
|
|
Name:
Xxxxxx X. Xxxxxxxx
|
|
|
Title: President
& CEO
|
|
ACCEPTED
AND AGREED:
DEERFIELD
PRIVATE DESIGN INTERNATIONAL, L.P.
By: Deerfield
Capital, L.P., General Partner
By: X.X.
Xxxxx Capital, LLC, General Partner
|
By:
|
/s/ Xxxxx X. Xxxxx
|
|
Name:
Xxxxx X. Xxxxx
|
|
|
Title: Director
|
Resident
in: British Virgin Islands
Signature
Page to Investment Agreement
Schedule
2.1
First
Tranche
|
Purchaser
|
Number of Series A-1 Preferred
|
Purchase Price Per Share
|
Aggregate Purchase Price
|
|||||||||
|
Warburg
Pincus Private Equity X,
L.P.
|
348,840 | $ | 100 | $ | 34,884,000 | |||||||
|
Warburg
Pincus X Partners,
L.P.
|
11,160 | $ | 100 | $ | 1,116,000 | |||||||
|
Deerfield
Private Design Fund,
L.P.
|
10,616 | $ | 100 | $ | 1,061,600 | |||||||
|
Deerfield
Private Design
International,
L.P.
|
17,102 | $ | 100 | $ | 1,710,200 | |||||||
|
Deerfield
Special Situation Fund,
L.P.
|
4,396 | $ | 100 | $ | 439,600 | |||||||
|
Deerfield
Special Situations Fund
International
Limited
|
7,886 | $ | 100 | $ | 788,600 | |||||||
Schedule
2.2(b)
Series A-1 Additional
Investment Tranches
|
Maximum Series A-1 Additional Investment
Shares (in aggregate)
|
Minimum Number of Series A-1 Preferred (per
tranche)
|
Purchase Price Per Share
|
||||||
|
200,000
|
100,000 |
1
|
$ | 100 | ||||
1 Subject
to reduction pursuant to Section
5.22(b).
Schedule
2.2(c)
Series A-2 Subsequent
Investment Right
|
Maximum Series A-2 Subsequent Investment Shares
|
Purchase Price Per Share
|
|||
|
400,000
|
$ | 100 | ||
Schedule
2.3(a)
Series A-1 Annex I
Additional Investment Tranches
|
Maximum A-1 Annex I Additional Investment
|
Minimum Number of Series A-1 Preferred (per
|
|||||||
|
Shares (in aggregate)
|
tranche)2
|
Purchase Price Per Share
|
||||||
|
200,000
|
100,000 | $ | 100 | |||||
2 Subject
to reduction pursuant to Section
5.22(b).
Schedule
2.3(b)
Series A-1 Annex I
Subsequent Investment Tranches
|
Maximum Series A-1 Annex I Subsequent
Investment Shares (in aggregate)
|
Minimum Number of Series A-1 Annex I
Preferred (per tranche)
|
Purchase Price Per Share
|
||||||
|
400,000
|
100,0003 | $ | 100 | |||||
3 Subject
to reduction pursuant to Section
5.22(b).
