Exhibit 10.57
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
THIS SERIES B PREFERRED STOCK PURCHASE AGREEMENT (the "Stock Purchase
Agreement") is made as of February 27, 1998 by and between X.X. Xxxxxx & Co., a
Delaware corporation ("XXXXXX"), and Epimmune Inc., a Delaware corporation
("EPIMMUNE").
WHEREAS, XXXXXX desires to purchase from EPIMMUNE and EPIMMUNE desires
to sell to XXXXXX shares of EPIMMUNE's preferred stock as provided for herein;
and
WHEREAS, concurrently herewith, the parties hereto are entering into a
License and Collaboration Agreement (the "Collaboration Agreement").
NOW, THEREFORE, in consideration of the mutual promises, covenants and
conditions hereinafter set forth, the parties hereto agree as follows:
1. PURCHASE AND SALE OF SHARES
1.1 PURCHASE AND SALE OF SHARES. Subject to the terms and conditions
hereof, at the Closing (as defined below) XXXXXX shall purchase from EPIMMUNE,
and EPIMMUNE shall issue and sell to XXXXXX, 1,032,149 shares of EPIMMUNE Series
B Preferred Stock, par value $0.001 (the "Shares"), at a per share purchase
price of $5.91, for an aggregate purchase price of $6,100,000, payable in cash.
1.2 CLOSING. Subject to the terms of Sections 6 and 7, the closing of
the sale and purchase of the Shares pursuant to Section 1.1 (the "Closing")
shall be held on the date hereof or at such other time upon which XXXXXX and
EPIMMUNE shall agree. The Closing shall take place at the offices of Xxxxxx
Godward LLP, 0000 Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxx Xxxxx, Xxxxxxxxxx 00000.
1.3 DELIVERY. At the Closing, subject to the terms and conditions
hereof, EPIMMUNE shall deliver to XXXXXX a stock certificate registered in the
name of XXXXXX representing the Shares purchased pursuant to Section 1.1 and
dated as of the Closing against payment of the purchase price therefor by wire
transfer, unless other means of payment shall have been agreed upon by EPIMMUNE
and XXXXXX.
2. REPRESENTATIONS AND WARRANTIES OF EPIMMUNE.
EPIMMUNE hereby makes the following representations and warranties to
XXXXXX, except as set forth in the Schedule of Exceptions attached hereto as
Exhibit A:
2.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. EPIMMUNE is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all requisite corporate power and authority to
carry on its business. EPIMMUNE is duly qualified to transact business and is in
good standing in each jurisdiction in which the failure so to qualify would have
a material adverse effect on its business or properties.
2.2 AUTHORIZATION; DUE EXECUTION. EPIMMUNE has the requisite corporate
power and authority to enter into this Stock Purchase Agreement and an Investor
Rights Agreement substantially in the form attached hereto as Exhibit B (the
"Investor Rights Agreement") and a Voting Agreement substantially in the form
attached hereto as Exhibit C (the "Voting Agreement") (the Stock Purchase
Agreement, the Investor Rights Agreement and the Voting Agreement are
collectively referred to as the "Agreements") and to perform its obligations
under the terms of the Agreements and, at the Closing, will have the requisite
corporate power to sell the Shares. All corporate action on the part of
EPIMMUNE, its officers, directors and stockholders necessary for the
authorization, execution and delivery of the Agreements has been taken. Each of
the Agreements has been duly authorized, executed and delivered by EPIMMUNE,
and, upon due execution and delivery by XXXXXX, will be a valid and binding
agreement of EPIMMUNE, enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally or by equitable
principles.
2.3 CAPITALIZATION. The authorized capital stock of EPIMMUNE consists
or will consist as of the Closing of 20,000,000 shares of Common Stock, par
value $0.001, and 10,000,000 shares of Preferred Stock, par value $0.001, of
which 6,000,000 shares have been designated Series A Preferred Stock, 1,032,149
shares have been designated Series B Preferred Stock and 659,898 shares have
been designated Series B-1 Preferred Stock. As of February 26, 1998, there were
no shares of Common Stock outstanding and 6,000,000 shares of Series A Preferred
Stock issued and outstanding. The rights, preferences and privileges of the
Series A Preferred Stock, the Series B Preferred Stock and the Series B-1
Preferred Stock will, as of the Closing, be as set forth in EPIMMUNE'S Amended
and Restated Certificate of Incorporation substantially in the form attached
hereto as Exhibit C (the "Restated Certificate"). Other than as contemplated by
the Agreements, the conversion rights of the Preferred Stock and options to
purchase 1,460,791 shares of Common Stock issued, and 459,209 shares of Common
Stock available for future option grants, to certain employees, officers,
directors, consultants and advisors of EPIMMUNE, there are no subscriptions,
options, warrants, rights or agreements (contingent or otherwise), including
without limitation, conversion rights, preemptive rights, rights of first
refusal or other rights or agreements, providing for the issuance by EPIMMUNE of
Common Stock or other equity securities of EPIMMUNE. The Shares to be acquired
by XXXXXX pursuant to Section 1.1 above will constitute (i) approximately 13.42%
of the outstanding shares of Common Stock of EPIMMUNE on an as-converted,
undiluted basis, and (ii) approximately 11.28% of the outstanding Common Stock
of EPIMMUNE on an as-converted, fully diluted basis, assuming exercise of all
outstanding rights, warrants and options to acquire Common Stock.
2.4 VALID ISSUANCE OF SHARES. The Shares when issued, sold and
delivered in accordance with the terms hereof for the consideration set forth
herein, will be duly and validly authorized and issued, fully paid and
nonassessable, free of all taxes, liens and charges, and, based in part upon the
representations of XXXXXX in this Stock Purchase Agreement, will be issued in
compliance with all applicable federal and state securities laws.
2.5 GOVERNMENTAL CONSENTS. No consent, approval, order or authorization
of, or registration, qualification, designation, declaration or filing with, any
federal, state, local or provincial governmental authority on the part of
EPIMMUNE is required in connection with the consummation of the transactions
contemplated by the Agreements, except for notices required or permitted to be
2.
filed with certain state and federal securities commissions after the Closing,
which notices will be filed on a timely basis.
2.6 FINANCIAL INFORMATION. EPIMMUNE has provided to XXXXXX unaudited
financial statements as of and for the three month period ended December 31,
1997 and the one month period ending January 31, 1998 (the "Financial
Statements"). The Financial Statements have been prepared in accordance with
generally accepted accounting principles consistently applied, except as
disclosed therein, and present fairly the financial condition and position of
EPIMMUNE as of the date thereof, subject to normal recurring year-end
adjustments and except that they do not contain all footnotes required under
generally accepted accounting principles.
2.7 NO CONFLICT. The execution, delivery and performance by EPIMMUNE of
the Agreements do not and will not violate any provision of EPIMMUNE's
Certificate of Incorporation or By-laws, any provision of any order, writ,
judgment, injunction, decree, determination or award to which EPIMMUNE is a
party or by which it is bound, or to EPIMMUNE's knowledge, any law, rule or
regulation (including, without limitation, the rules and regulations of the
Securities and Exchange Commission (the "SEC") or any regulatory commission of
any jurisdiction) currently in effect having applicability to EPIMMUNE.
2.8 ABSENCE OF LITIGATION. There is no action, suit, proceeding or
investigation (including any such matter related to EPIMMUNE's intellectual
property) pending or currently threatened against EPIMMUNE or its properties
before any court or governmental agency, which would, singly or in the
aggregate, have a material adverse effect on EPIMMUNE's business, operations or
assets, taken as a whole (nor, to the best of EPIMMUNE's knowledge, is there any
basis therefor). There is no action, suit, proceeding or investigation which
EPIMMUNE currently intends to initiate.
2.9 CONFIDENTIALITY. EPIMMUNE hereby represents, warrants and covenants
that it shall maintain in confidence, and shall not use or disclose without
prior written consent of XXXXXX, the terms of this Stock Purchase Agreement and
any information identified in writing as confidential that is furnished to it by
XXXXXX in connection with this Stock Purchase Agreement. This obligation of
confidentiality shall not apply, however, to any information (a) in the public
domain through no unauthorized act or failure to act by EPIMMUNE, (b) lawfully
disclosed to EPIMMUNE by a third party who possessed such information without
any obligation of confidentiality, (c) lawfully developed by EPIMMUNE
independent of any disclosure by EPIMMUNE as supported by EPIMMUNE written
records, or (d) required to be disclosed pursuant to applicable law, regulation
or order or requirement of a court, administrative agency or other government
body (including the securities laws of any applicable jurisdiction); provided
that if EPIMMUNE is required to make any such disclosure of such information it
will to the extent practicable give reasonable advance notice to XXXXXX of such
disclosure requirement and will use its reasonable best efforts to secure
confidential treatment of such information required to be disclosed. EPIMMUNE
further covenants that it shall return to XXXXXX all tangible materials
containing such information upon request by XXXXXX. EPIMMUNE and XXXXXX
acknowledge and agree that EPIMMUNE will be required to disclose the issuance of
the Shares contemplated by this Stock Purchase Agreement pursuant to applicable
securities laws and regulations.
3.
3. REPRESENTATIONS AND WARRANTIES OF XXXXXX.
XXXXXX hereby makes the following representations and warranties to
EPIMMUNE as of the date hereof and the Closing:
3.1 AUTHORIZATION; DUE EXECUTION. XXXXXX has the requisite corporate
power and authority to enter into the Agreements and to perform its obligations
under the terms of the Agreements and, at the Closing, will have the requisite
corporate power to purchase the Shares. All corporate action on the part of
XXXXXX, its officers, directors and stockholders necessary for the
authorization, execution and delivery of the Agreements has been taken. Each of
the Agreements has been duly authorized, executed and delivered by XXXXXX, and,
upon due execution and delivery by EPIMMUNE, will be a valid and binding
agreement of XXXXXX, enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally or by equitable
principles.
3.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Stock Purchase Agreement is
made with XXXXXX in reliance upon XXXXXX'x representation to EPIMMUNE, which by
XXXXXX'x execution of this Agreement XXXXXX confirms, that the Shares to be
purchased by XXXXXX will be acquired for investment for XXXXXX'x own account,
not as a nominee or agent, and not with a view to the resale or distribution of
any part thereof, and that XXXXXX has no present intention of selling, granting
any participation in, or otherwise distributing the same (subject to the
disposition of XXXXXX'x property being at all times within its control). By
executing this Stock Purchase Agreement, XXXXXX further represents that XXXXXX
does not have any contract, undertaking, agreement or arrangement with any
person to sell, transfer or grant participation to such person or to any third
person, with respect to any of the Shares.
3.3 DISCLOSURE OF INFORMATION. XXXXXX has received all the information
that it has requested and that it considers necessary or appropriate for
deciding whether to enter into this Stock Purchase Agreement and to purchase the
Shares. XXXXXX further represents that it has had an opportunity to ask
questions and receive answers from EPIMMUNE regarding the terms and conditions
of the offering of the Shares.
3.4 INVESTMENT EXPERIENCE. XXXXXX is an investor in securities of
companies in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment in the Shares. XXXXXX also represents it has
not been organized solely for the purpose of acquiring the Shares.
3.5 ACCREDITED INVESTOR. XXXXXX is an "accredited investor" as such
term is defined in Rule 501 of the General Rules and Regulations prescribed by
the SEC pursuant to the Securities Act of 1933, as amended (the "Securities
Act").
3.6 RESTRICTED SECURITIES. XXXXXX understands that (a) the Shares have
not been registered under the Securities Act by reason of a specific exemption
therefrom, that such securities must be held by it indefinitely and that XXXXXX
must, therefore, bear the economic risk of such investment indefinitely, unless
in each case a subsequent disposition thereof is registered under the Securities
4.
Act or is exempt from such registration; (b) each certificate representing the
Shares will be endorsed with the following legend:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS
TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY
TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
and (c) Epimmune will instruct any transfer agent not to register the transfer
of the Shares (or any portion thereof) unless the conditions specified in the
foregoing legends are satisfied, until such time as a transfer is made, pursuant
to the terms of this Agreement, and in compliance with Rule 144 or pursuant to a
registration statement or, if the opinion of counsel referred to above is to the
further effect that such legend is not required in order to establish compliance
with any provisions of the Securities Act or this Stock Purchase Agreement.
3.7 CONFIDENTIALITY. XXXXXX hereby represents, warrants and covenants
that it shall maintain in confidence, and shall not use or disclose without
prior written consent of EPIMMUNE, the terms of this Stock Purchase Agreement
and any information identified in writing as confidential that is furnished to
it by EPIMMUNE in connection with this Stock Purchase Agreement. This obligation
of confidentiality shall not apply, however, to any information (a) in the
public domain through no unauthorized act or failure to act by XXXXXX, (b)
lawfully disclosed to XXXXXX by a third party who possessed such information
without any obligation of confidentiality, (c) lawfully developed by XXXXXX
independent of any disclosure by EPIMMUNE as supported by XXXXXX'x written
records, or (d) required to be disclosed pursuant to applicable law, regulation
or order or requirement of a court, administrative agency or other government
body (including the securities laws of any applicable jurisdiction); provided
that if XXXXXX is required to make any such disclosure of such information it
will to the extent practicable give reasonable advance notice to EPIMMUNE of
such disclosure requirement and will use its reasonable best efforts to secure
confidential treatment of such information required to be disclosed. XXXXXX
further covenants that it shall return to EPIMMUNE all tangible materials
containing such information upon request by EPIMMUNE.
4. CONDITIONS OF XXXXXX'X OBLIGATIONS
The obligations of XXXXXX under this Agreement are subject to the
fulfillment on or before the Closing of each of the following conditions, any of
which may be waived by XXXXXX (and which conditions shall be deemed to have been
fulfilled or waived upon the occurrence of the Closing):
4.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of EPIMMUNE contained in Section 2 shall be true and correct in all material
respects on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of said date.
5.
4.2 PERFORMANCE. EPIMMUNE shall have performed and complied with all
agreements, obligations and conditions in this Stock Purchase Agreement, if any,
that are required to be performed or complied with by it on or before the
Closing.
4.3 DELIVERY OF SHARES. EPIMMUNE shall have tendered delivery of the
Shares specified in Section 1.1 at the Closing.
4.4 INVESTOR RIGHTS AGREEMENT. An Investor Rights Agreement
substantially in the form attached hereto as Exhibit B shall have been executed
and delivered by EPIMMUNE and Cytel Corporation.
4.5 VOTING AGREEMENT. A Voting Agreement substantially in the form
attached hereto as Exhibit C shall have been executed and delivered by EPIMMUNE
and Cytel Corporation.
4.6 FILING OF AMENDED AND RESTATED CERTIFICATE. The Restated
Certificate substantially in the form attached hereto as Exhibit D shall have
been filed with the Secretary of State of Delaware.
4.7 LEGAL OPINION. An opinion of counsel to EPIMMUNE substantially in
the form attached hereto as Exhibit E shall have been delivered to XXXXXX at the
Closing.
4.8 BOARD OF DIRECTORS. Upon the Closing, the authorized size of the
Board of Directors of Epimmune shall be five members and the Board shall consist
of Xxxxxx X. Xxxxxx, Xx., Xxxxxx X. Xxxxxxxx, Xxxxxx X. Xxx, Xxxxxxx Xxxxxxxx
and Xxxxx X. Xxxxxxxxx.
4.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
incident thereto shall be reasonably satisfactory in form and substance to
XXXXXX, and it shall have received all such counterpart original and certified
or other copies of such documents as it may reasonably request.
5. CONDITIONS OF EPIMMUNE'S OBLIGATIONS
The obligations of EPIMMUNE under this Agreement are subject to the
fulfillment on or before the Closing of each of the following conditions by
XXXXXX, any of which may be waived by EPIMMUNE (and which conditions shall be
deemed to have been fulfilled or waived upon the occurrence of the Closing):
5.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of XXXXXX contained in Section 3 hereof shall be true and correct in all
material respects on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of said dates.
5.2 PERFORMANCE. XXXXXX shall have performed and complied with all
agreements, obligations and conditions in this Stock Purchase Agreement, if any,
that are required to be performed or complied with by it on or before the
Closing.
5.3 PAYMENT OF PURCHASE PRICE. XXXXXX shall have tendered delivery of
the purchase price for the Shares specified in Section 1.1 at the Closing.
6.
5.4 INVESTOR RIGHTS AGREEMENT. An Investor Rights Agreement
substantially in the form attached hereto as Exhibit B shall have been executed
and delivered by XXXXXX.
5.5 VOTING AGREEMENT. A Voting Agreement substantially in the form
attached hereto as Exhibit C shall have been executed and delivered by XXXXXX.
5.6 FILING OF AMENDED AND RESTATED CERTIFICATE. The Restated
Certificate in the form attached hereto as Exhibit D shall have been filed with
the Secretary of State of Delaware.
5.7 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
incident thereto shall be reasonably satisfactory in form and substance to
EPIMMUNE, and it shall have received all such counterpart original and certified
or other copies of such documents as it may reasonably request.
6. INDEMNIFICATION
6.1 INDEMNIFICATION OF XXXXXX. EPIMMUNE agrees to indemnify and hold
harmless XXXXXX and its permitted successors and assigns from and against any
and all (i) liabilities, losses, costs or damages ("Loss") and (ii) reasonable
attorneys' and accountants' fees and expenses, court costs and all other
reasonable out-of-pocket expenses ("Expense") incurred by XXXXXX or its
permitted successors and assigns arising from (A) any breach or failure to
perform by EPIMMUNE of any of its covenants or agreements contained in this
Agreement; or (B) any breach of any warranty or the inaccuracy of any
representation of EPIMMUNE contained in this Agreement.
6.2 NOTICE OF CLAIMS BY XXXXXX. If any person indemnified under Section
6.1 hereof believes it has suffered or incurred any Loss or incurred any Expense
as to which it is entitled to indemnification under Section 6.1 hereof, such
person shall so notify EPIMMUNE promptly in writing describing such Loss or
Expense, the amount thereof, if known, and the method of computation of such
Loss or Expense, all with reasonable particularity and containing a reference to
the provisions of this Agreement, or any agreement or instrument contemplated
hereby, or any certificate delivered pursuant hereto or thereto in respect of
which such Loss or Expense shall have occurred; and if any action at law or suit
in equity is instituted by or against a third party with respect to which any
such indemnified person intends to claim any Loss or Expense under Section 6.1,
such indemnified person shall promptly notify the indemnifying party of such
action or suit; provided that failure to give such notice shall not abrogate or
diminish EPIMMUNE's obligations under Section 6.1 if EPIMMUNE has or receives
timely actual knowledge of the existence of any such claim by any other means or
except to the extent such failure prejudices EPIMMUNE.
6.3 INDEMNIFICATION OF EPIMMUNE. XXXXXX agrees to indemnify and hold
harmless EPIMMUNE and its permitted successors and assigns from and against any
and all Loss and Expense incurred by EPIMMUNE and its permitted successors and
assigns arising from (i) any breach or failure to perform by XXXXXX of any of
its covenants or agreements contained in this Agreement; or (ii) any breach of
any warranty or the inaccuracy of any representation of XXXXXX contained in this
Agreement.
7.
6.4 NOTICE OF CLAIMS BY EPIMMUNE. If any person indemnified under
Section 6.3 believes that it has suffered or incurred any Loss or incurred any
Expense as to which it is entitled to indemnification under Section 6.3, such
person shall so notify XXXXXX or the person responsible for such indemnification
promptly in writing describing such Loss or Expense, the amount thereof, if
known, and the method of computation of such Loss or Expense, all with
reasonable particularity and containing a reference to the provisions of this
Agreement, or any agreement or instrument contemplated hereby, or any
certificate delivered pursuant hereto or thereto in respect of which such Loss
or Expense shall have occurred; and if any action at law or suit in equity is
instituted by or against a third party with respect to which any such
indemnified party intends to claim any Loss or Expense under Section 6.3, such
indemnified party shall promptly notify the indemnifying party of such action or
suit; provided that failure to give such notice shall not abrogate or diminish
XXXXXX'x obligations under Section 6.3 if XXXXXX has or receives timely actual
knowledge of the existence of any such claim by any other means or except to the
extent such failure prejudices XXXXXX.
6.5 THIRD PARTY CLAIMS. The indemnifying party shall have the right to
participate in, and, to the extent the it so desires, jointly with any other
indemnitor similarly noticed, to assume the defense of any third party claim,
demand, action or other proceeding with counsel selected by the indemnifying
party; provided, however, that the indemnified party shall have the right to
retain its own counsel, with the fees and expenses to be paid by the
indemnifying party, if representation of the indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential differing interests between the indemnified party and any other party
represented by such counsel in such proceedings. So long as the indemnifying
party has received notice of any third party claim, demand, action or proceeding
for which any indemnified party intends to claim any Loss or Expense, and within
a reasonable period thereafter the indemnifying party has assumed the defense
thereof, the indemnity obligations under this Article 6 shall not apply to
amounts paid in settlement of such third party claim, demand, action or
proceeding if such settlement is effected without the consent of the
indemnifying party, which consent shall not be unreasonably withheld or delayed.
The indemnifying party may not settle or otherwise consent to an adverse
judgment in any such third party claim, demand, action or proceeding action that
diminishes the rights or interests of the indemnified party without the prior
express written consent of the indemnified party. The indemnified party, its
employees and agents, shall cooperate reasonably with the indemnifying party and
its legal representatives in the investigation of any third party claim, demand,
action or proceeding covered by this Article 6.
7. MISCELLANEOUS PROVISIONS
7.1 SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective permitted
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective permitted successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
8.
7.2 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of California, as applied to contracts executed and
performed entirely within the State of California, without regard to conflicts
of laws rules.
7.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.4 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
7.5 ASSIGNMENT. This Agreement may not be assigned or otherwise
transferred, nor, except as expressly provided hereunder, may any right or
obligations hereunder be assigned or transferred, by either party without the
written consent of the other party; provided, however, that either EPIMMUNE or
XXXXXX may, without such consent, assign this Agreement and its rights and
obligations hereunder (a) in connection with the transfer or sale of all or
substantially all of that portion of its business relating to its performance of
its respective obligations hereunder or (b) in the event of its merger or
consolidation with another company at any time during the term of this
Agreement. Any purported assignment in violation of the preceding sentence shall
be void. Any other permitted assignee shall also assume all obligations of its
assignor under this Agreement.
7.6 NOTICES. Any notice or report required or permitted to be given or
made under this Agreement by one of the parties hereto to the other shall be in
writing, delivered personally or by facsimile (and promptly confirmed by
personal delivery or courier) or courier, postage prepaid, addressed to such
other party at its address indicated below, or to such other address as the
addressee shall have last furnished in writing to the addressor and shall be
effective upon receipt by the addressee.
EPIMMUNE: Epimmune Inc.
0000 Xxxxx Xxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: President
Tel: (000) 000-0000
Fax: (000) 000-0000
WITH A COPY TO: Xxxxxx Godward LLP
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000.0000
9.
XXXXXX: X.X. Xxxxxx & Xx.
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Vice President, Business
Development
Tel: (000) 000-0000
Fax: (000) 000-0000
WITH A COPY TO: X.X. Xxxxxx & Xx.
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: General Counsel
Tel: (000) 000-0000
Fax: (000) 000-0000
7.7 FINDER'S FEE. Each party represents that it neither is nor will be
obligated for any finders' fee or commission in connection with this
transaction, other than as agreed between the parties. XXXXXX agrees to
indemnify and hold harmless EPIMMUNE from any liability for any commission or
compensation in the nature of a finders' fee (and the costs and expenses of
defending against such liability or asserted liability) for which XXXXXX or any
of its officers, partners, employees or representatives is responsible. EPIMMUNE
agrees to indemnify and hold harmless XXXXXX from any liability for any
commission or compensation in the nature of a finder's fee (and the costs and
expenses of defending against such liability or asserted liability) for which
EPIMMUNE or any of its officers, employees or representatives is responsible.
7.8 EXPENSES. Irrespective of whether the Closing is effected, each
party shall bear its own costs with respect to the negotiation, execution,
delivery and performance of this Agreement.
7.9 AMENDMENTS AND WAIVERS. Except as specified in this Section 7.9,
any term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively) only with the written consent of EPIMMUNE and
XXXXXX.
7.10 SEVERABILITY. If one or more provisions of this Agreement is held
to be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of this Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
7.11 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto with regard to the subject matter hereof.
7.12 FURTHER ASSURANCES. Each party hereto agrees to do such further
actions and things, and to execute and deliver such additional agreements and
instruments, as either party may reasonably request of the other to effectuate
the transactions contemplated by this Agreement.
10.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the date first set forth above.
X.X. XXXXXX & CO. EPIMMUNE INC.
By: /s/ X. Xx Xxxxxxxx By:/s/ Xxxxxxx Xxxxxxxx
------------------------------------- ---------------------------------
Name: X. Xx Xxxxxxxx Name: Xxxxxxx Xxxxxxxx
----------------------------------- -------------------------------
Title: Chairman and CEO Title:
---------------------------------- ------------------------------
EXHIBIT A
SCHEDULE OF EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
This Schedule of Exceptions is made and given pursuant to Section 2 of the
Series B Preferred Stock Purchase Agreement dated as of February 27, 1998
between Epimmune Inc. and X.X. Xxxxxx and Co.
NONE
EXHIBIT B
EPIMMUNE INC.
INVESTOR RIGHTS AGREEMENT
This INVESTOR RIGHTS AGREEMENT (the "Investor Rights Agreement") is
entered into as of the 27th day of February, 1998, by and among EPIMMUNE INC., a
Delaware corporation (the "Company"), X.X. XXXXXX & CO., a Delaware corporation
("Xxxxxx"), CYTEL CORPORATION, a Delaware corporation ("Cytel") (collectively,
Xxxxxx and Cytel shall be referred to as the "Investors").
RECITALS
WHEREAS, the Company proposes to sell and issue 1,032,149 shares of its
Series B Preferred Stock, $0.001 par value (the "Series B Preferred"), to Xxxxxx
pursuant to the Series B Preferred Stock Purchase Agreement of even date
herewith (the "Series B Stock Purchase Agreement");
WHEREAS, the Company proposes to sell and issue 659,898 shares of its
Series B-1 Preferred Stock, $0.001 par value (the "Series B-1 Preferred"), to
Cytel pursuant to the Series B-1 Preferred Stock Purchase Agreement of even date
herewith (the "Series B-1 Stock Purchase Agreement");
WHEREAS, as a condition of entering into the Series B Stock Purchase
Agreement and the Series B-1 Stock Purchase Agreement, the Investors requested
that the Company extend to it registration rights and other rights as set forth
below; and
WHEREAS, this Investor Rights Agreement shall be effective only upon
the closing of the Series B Stock Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement and in the Series B Stock Purchase Agreement and the Series B-1 Stock
Purchase Agreement, the parties mutually agree as follows:
1. GENERAL.
1.1 DEFINITIONS. As used in this Investor Rights Agreement the
following terms shall have the following respective meanings:
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"HOLDER" means any person owning of record Registrable Securities
that have not been sold to the public or any assignee of record of such
Registrable Securities in accordance with Section 2.8 hereof.
"INITIAL OFFERING" means the Company's first firm commitment
underwritten public offering of its Common Stock registered under the Securities
Act in which the Company receives gross proceeds of at least $15 million.
1.
"REGISTER," "REGISTERED," and "REGISTRATION" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of
effectiveness of such registration statement or document.
"REGISTRABLE SECURITIES" means (i) Common Stock of the Company
issued or issuable upon conversion of the Shares; and (ii) any Common Stock of
the Company issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of, such
above-described securities. Notwithstanding the foregoing, Registrable
Securities shall not include any securities sold by a person to the public
either pursuant to a registration statement or Rule 144 or sold in a private
transaction in which the transferor's rights under Section 2 of this Agreement
are not assigned.
"REGISTRATION EXPENSES" shall mean all expenses incurred by the
Company in complying with Sections 2.2 hereof, including, without limitation,
all registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, reasonable fees and disbursements of counsel for the
Company, reasonable fees and disbursements not to exceed twenty-five thousand
dollars ($25,000) of a single special counsel for the Holders, blue sky fees and
expenses and the expense of any special audits incident to or required by any
such registration (but excluding the compensation of regular employees of the
Company which shall be paid in any event by the Company).
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SELLING EXPENSES" shall mean all underwriting discounts and
selling commissions applicable to the sale.
"SHARES" shall mean the Company's Series B Preferred and Series B-1
Preferred.
"SEC" or "COMMISSION" means the Securities and Exchange Commission.
2. RESTRICTIONS ON TRANSFER; REGISTRATION.
2.1 RESTRICTIONS ON TRANSFER.
(a) Each Holder agrees not to make any disposition of all or any
portion of the Shares or Registrable Securities unless and until:
(i) There is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(ii) (A) The transferee has agreed in writing to be bound by the
terms of this Agreement, (B) such Holder shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and (C) if
reasonably requested by the Company, such Holder shall have furnished the
Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such shares under the
2.
Securities Act. It is agreed that the Company will not require opinions of
counsel for transactions made pursuant to Rule 144 except in unusual
circumstances.
(iii) Notwithstanding the provisions of paragraphs (a)(i) and
(a)(ii) above, no such registration statement or opinion of counsel shall be
necessary for a transfer by a Holder which is (A) a partnership to its partners
or former partners in accordance with partnership interests, (B) a corporation
to its stockholders in accordance with their interest in the corporation, (C) a
limited liability company to its members or former members in accordance with
their interest in the limited liability company, or (D) to the Holder's family
member or trust for the benefit of an individual Holder, provided the transferee
will be subject to the terms of this Agreement to the same extent as if he were
an original Holder hereunder.
(b) Each certificate representing Shares or Registrable Securities
shall (unless otherwise permitted by the provisions of the Agreement) be stamped
or otherwise imprinted with a legend substantially similar to the following (in
addition to any legend required under applicable state securities laws or as
provided elsewhere in this Agreement or any other applicable agreement or
instrument):
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
SAID ACT OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED."
(c) The Company shall be obligated to reissue promptly unlegended
certificates at the request of any holder thereof if the Holder shall have
obtained an opinion of counsel (which counsel may be counsel to the Company)
reasonably acceptable to the Company to the effect that the securities proposed
to be disposed of may lawfully be so disposed of without registration,
qualification or legend.
(d) Any legend endorsed on an instrument pursuant to applicable
state securities laws and the stop-transfer instructions with respect to such
securities shall be removed upon receipt by the Company of an order of the
appropriate blue sky authority authorizing such removal.
2.2 "PIGGY-BACK" REGISTRATIONS. In the event that shares of the
Company's equity securities held by any selling stockholder are included in a
registration statement under the Securities Act for purposes of the Company's
Initial Offering, the Company shall notify all Holders of Registrable Securities
in writing at least thirty (30) days prior to the filing of such registration
statement and will afford each such Holder an opportunity to include in such
registration statement all or part of such Registrable Securities held by such
Holder on a pro rata basis with the securities of such other selling
stockholders to be included in the Registration Statement. Each Holder desiring
to include in any such registration statement all or any part of the Registrable
3.
Securities held by it shall, within twenty (20) days after the above-described
notice from the Company, so notify the Company in writing.
(a) UNDERWRITING. If the registration statement under which the
Company gives notice under this Section 2.2 is for an underwritten offering, the
Company shall so advise the Holders of Registrable Securities. In such event,
the right of any such Holder to be included in a registration pursuant to this
Section 2.2 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to distribute
their Registrable Securities through such underwriting shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company. Notwithstanding any other
provision of this Agreement, if the underwriter determines in good faith that
marketing factors require a limitation of the number of shares to be
underwritten, the number of shares that may be included in the underwriting
shall be allocated, first, to the Company; and second, to any stockholder of the
Company (including the Holders) on a pro rata basis based on the total number of
Registrable Securities held by the Holders and securities held by such other
stockholders; provided that no such reduction shall reduce the securities being
offered by the Company for its own account to be included in the registration
and underwriting.
(b) RIGHT TO TERMINATE REGISTRATION. The Company shall have the
right to terminate or withdraw any registration initiated by it under this
Section 2.2 prior to the effectiveness of such registration whether or not any
Holder has elected to include securities in such registration. The Registration
Expenses of such withdrawn registration shall be borne by the Company in
accordance with Section 2.3 hereof.
2.3 EXPENSES OF REGISTRATION. Except as specifically provided herein,
all Registration Expenses incurred in connection with any registration under
Section 2.2 herein shall be borne by the Company. All Selling Expenses incurred
in connection with any registrations hereunder, shall be borne by the holders of
the securities so registered pro rata on the basis of the number of shares so
registered.
2.4 OBLIGATIONS OF THE COMPANY. Whenever required to effect the
registration of any Registrable Securities, the Company shall, as expeditiously
as reasonably possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use all reasonable efforts to cause
such registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for up to ninety (90) days or, if earlier,
until the Holder or Holders have completed the distribution related thereto.
(b) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.
4.
(c) Furnish to the Holders such number of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities owned by them.
(d) Use all reasonable efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders, provided that the Company shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a general consent
to service of process in any such states or jurisdictions.
(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter(s) of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.
(g) Furnish, at the request of a majority of the Holders
participating in the registration, on the date that such Registrable Securities
are delivered to the underwriters for sale, if such securities are being sold
through underwriters, or, if such securities are not being sold through
underwriters, on the date that the registration statement with respect to such
securities becomes effective, (i) an opinion, dated as of such date, of the
counsel representing the Company for the purposes of such registration, in form
and substance as is customarily given to underwriters in an underwritten public
offering, addressed to the underwriters, if any, and (ii) a letter dated as of
such date, from the independent certified public accountants of the Company, in
form and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed to the
underwriters, if any.
2.5 TERMINATION OF REGISTRATION RIGHTS. All registration rights granted
to a Holder under this Section 2 shall terminate and be of no further force and
effect upon completion of the distribution of the Company's Common Stock in the
Company's Initial Offering.
2.6 FURNISHING INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to Section 2.2 that the
selling Holders shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them and the intended method of
disposition of such securities as shall be required to effect the registration
of their Registrable Securities.
5.
2.7 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under Section 2.2:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless each Holder, the partners, officers, directors and legal counsel
of each Holder, any underwriter (as defined in the Securities Act) for such
Holder and each person, if any, who controls such Holder or underwriter within
the meaning of the Securities Act or the Exchange Act, against any losses,
claims, damages, or liabilities (joint or several) to which they may become
subject under the Securities Act, the Exchange Act or other federal or state
law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation") by the Company: (i) any
untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading, or
(iii) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law in
connection with the offering covered by such registration statement; and the
Company will reimburse each such Holder, partner, officer or director,
underwriter or controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided however, that the indemnity
agreement contained in this Section 2.7(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Company, which consent shall
not be unreasonably withheld, nor shall the Company be liable in any such case
for any such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by such Holder, partner, officer, director, underwriter
or controlling person of such Holder.
(b) To the extent permitted by law, each Holder will, if
Registrable Securities held by such Holder are included in the securities as to
which such registration qualifications or compliance is being effected,
indemnify and hold harmless the Company, each of its directors, its officers,
and legal counsel and each person, if any, who controls the Company within the
meaning of the Securities Act, any underwriter and any other Holder selling
securities under such registration statement or any of such other Holder's
partners, directors or officers or any person who controls such Holder, against
any losses, claims, damages or liabilities (joint or several) to which the
Company or any such director, officer, controlling person, underwriter or other
such Holder, or partner, director, officer or controlling person of such other
Holder may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages or liabilities (or
actions in respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such Violation occurs in
reliance upon and in conformity with written information furnished by such
Holder under an instrument duly executed by such Holder and stated to be
specifically for use in connection with such registration; and each such Holder
will reimburse any legal or other expenses reasonably incurred by the Company or
any such director, officer, controlling person, underwriter or other Holder, or
partner, officer, director or controlling person of such other Holder in
6.
connection with investigating or defending any such loss, claim, damage,
liability or action if it is judicially determined that there was such a
Violation; provided, however, that the indemnity agreement contained in this
Section 2.7(b) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Holder, which consent shall not be unreasonably withheld;
provided further, that in no event shall any indemnity under this Section 2.7
exceed the proceeds from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 2.7 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 2.7, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if materially prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 2.7, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section 2.7.
(d) If the indemnification provided for in this Section 2.7 is held
by a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any losses, claims, damages or liabilities referred to herein,
the indemnifying party, in lieu of indemnifying such indemnified party
thereunder, shall to the extent permitted by applicable law contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other in connection with the Violation(s) that resulted in such
loss, claim, damage or liability, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by a court of law by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission; provided, that in no event shall any contribution by a
Holder hereunder exceed the proceeds from the offering received by such Holder.
(e) The obligations of the Company and Holders under this Section
2.7 shall survive completion of any offering of Registrable Securities in a
registration statement. No indemnifying party, in the defense of any such claim
or litigation, shall, except with the consent of each indemnified party, consent
to entry of any judgment or enter into any settlement which does not include as
7.
an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation.
2.8 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the Company
to register Registrable Securities pursuant to this Section 2 may be assigned by
a Holder to a transferee or assignee of Registrable Securities which (i) is a
subsidiary, affiliate, parent, general partner, limited partner or retired
partner of a Holder, or (ii) is a Holder's family member, a trust for the
benefit of an individual Holder or such Holder's family members or a partnership
or other entity all of whose beneficial ownership is held by the Holder or such
Holder's family members; provided, however, (A) the transferor shall, within ten
(10) days after such transfer, furnish to the Company written notice of the name
and address of such transferee or assignee and the securities with respect to
which such registration rights are being assigned and (B) such transferee shall
agree to be subject to all restrictions set forth in this Agreement.
2.9 LIMITATION ON SUBSEQUENT REGISTRATION RIGHTS. After the date of
this Agreement, the Company shall not, enter into any agreement with any holder
or prospective holder of any securities of the Company that would grant such
holder registration rights senior to those granted to the Holders hereunder
unless the Company also grants such registration rights to the Holders.
2.10 "MARKET STAND-OFF" AGREEMENT. If requested by the Company or the
representative of the underwriters of Common Stock (or other securities) of the
Company, each Holder shall not sell or otherwise transfer or dispose of any
Common Stock (or other securities) of the Company held by such Holder (other
than those included in the registration) for a period specified by the
representative of the underwriters not to exceed one hundred eighty (180) days
following the effective date of a registration statement of the Company filed
under the Securities Act, provided that the Company, all officers and directors
of the Company and any other selling stockholders enter into similar agreements
(subject to customary exceptions).
The obligations described in this Section 2.10 shall not apply to a
registration relating solely to employee benefit plans on Form S-1 or Form S-8
or similar forms that may be promulgated in the future, or a registration
relating solely to a Commission Rule 145 transaction on Form S-4 or similar
forms that may be promulgated in the future. The Company may impose
stop-transfer instructions with respect to the shares of Common Stock (or other
securities) subject to the foregoing restriction until the end of said one
hundred eighty (180) day period.
2.11 RULE 144 REPORTING. With a view to making available to the Holders
the benefits of certain rules and regulations of the SEC which may permit the
sale of the Registrable Securities to the public without registration, the
Company agrees to use its best efforts to:
(a) Make and keep public information available, as those terms are
understood and defined in SEC Rule 144 or any similar or analogous rule
promulgated under the Securities Act, at all times after the effective date of
the first registration filed by the Company for an offering of its securities to
the general public;
(b) File with the SEC, in a timely manner, all reports and other
documents required of the Company under the Exchange Act; and
8.
(c) So long as a Holder owns any Registrable Securities, furnish to
such Holder forthwith upon request: a written statement by the Company as to its
compliance with the reporting requirements of said Rule 144 of the Securities
Act, and of the Exchange Act (at any time after it has become subject to such
reporting requirements); a copy of the most recent annual or quarterly report of
the Company; and such other reports and documents as a Holder may reasonably
request in availing itself of any rule or regulation of the SEC allowing it to
sell any such securities without registration.
3. COVENANTS OF THE COMPANY.
3.1 FINANCIAL INFORMATION AND REPORTING.
(a) As soon as practicable after the end of each fiscal year of the
Company, and in any event within one hundred twenty (120) days thereafter, the
Company will furnish to Xxxxxx a balance sheet of the Company, as at the end of
such fiscal year, and a statement of income and a statement of cash flows of the
Company, for such year, all prepared in accordance with generally accepted
accounting principles consistently applied and setting forth in each case in
comparative form the figures for the previous fiscal year, all in reasonable
detail. Such financial statements shall be accompanied by (i) a report and
opinion thereon by independent public accountants of national standing selected
by the Company's Board of Directors and reasonably acceptable to Xxxxxx, and
(ii) a certificate executed by an officer of the Company certifying that the
terms of the Series B Preferred and the terms of all other material agreements
between Xxxxxx and the Company, other than that certain License and
Collaboration Agreement dated as of February 27, 1998 (the "Collaboration
Agreement") between the Company and Xxxxxx and any other agreements entered
between the Company and Xxxxxx in connection with the Collaboration Agreement,
have been complied with.
(b) So long as Xxxxxx shall own not less than 5% of the Company's
outstanding capital stock, the Company will furnish Xxxxxx prior to the
beginning of each fiscal year a budget on a monthly basis for such fiscal year
(and as soon as available, any subsequent revisions thereto);
(c) The Company will furnish to Xxxxxx promptly after distribution
(and in any event within 10 days after distribution) other reports of the
Company that are publicly distributed, including written communications made
generally available to the Company's Stockholders or the financial community.
(d) The Company will furnish to each member of the Company's Board
of Directors, as soon as practicable after the end of each month, and in any
event within thirty (30) days thereafter, a balance sheet of the Company as of
the end of each such month, and a statement of income of the Company for such
month and for the current fiscal year to date, prepared in accordance with
generally accepted accounting principles consistently applied, with the
exception that no notes need be attached to such statements and year-end audit
adjustments may not have been made.
3.2 INSPECTION RIGHTS. Xxxxxx shall have the right to visit and inspect
any of the properties of the Company or any of its subsidiaries, and to discuss
9.
the affairs, finances and accounts of the Company or any of its subsidiaries
with its directors, officers, employees and independent public accountants, and
to review such information as is reasonably requested all at such reasonable
times and as often as may be reasonably requested.
3.3 XXXXXX APPROVAL. The Company shall not without the prior written
consent of Xxxxxx enter into any agreement which by its terms restricts the
Company's performance of the terms of the Series B Preferred Stock, the Series B
Stock Purchase Agreement or this Investor Rights Agreement.
3.4 INSIDER TRANSACTIONS. The Company shall not without the approval of
a majority of the Board of Directors, with all non-interested Directors voting
and the approval of the Director designated by Xxxxxx (the "Designated
Director"), authorize or enter into any transactions with any director or
management employee, or such director's or employee's immediate family, other
than indemnification and employment related transactions on customary terms.
3.5 DIRECTORS' FEES AND EXPENSES. For so long as Xxxxxx is entitled to
designate a representative to the Company's Board of Directors, the Company
covenants to (i) reimburse the Designated Director for all reasonable costs
associated with attending meetings of the Board of Directors, and (ii) pay the
Designated Director any compensation paid to other members of the Company's
Board of Directors in connection with the performance of their duties as a
Director.
3.6 CONFIDENTIALITY OF RECORDS. Xxxxxx agrees to keep confidential, and
to use its best efforts to insure that its authorized representatives keep
confidential, any information furnished or made available to it hereunder in
accordance with Section 3.7 of the Series B Stock Purchase Agreement.
3.7 BY-LAWS. The Company shall not, without prior written consent of
Xxxxxx, take any action to amend the By-laws of the Company to (i) change the
designated number of directors from five members or (ii) amend Section 22(b) of
Article IV of such By-laws.
3.8 TERMINATION OF COVENANTS. The covenants of the Company set forth in
Sections 3.1(a) and (b), 3.2, 3.3 and 3.7 of this Agreement shall expire and
terminate on the earlier of (i) the effective date of the registration statement
pertaining to the Initial Offering, or (ii) the date on which Xxxxxx shall own
less than 5% of the Company's outstanding capital stock determined on a
fully-diluted, as-converted basis. The covenants of the Company set forth in
Sections 3.1(c) and (d) and 3.4 of this Agreement shall expire and terminate on
the date on which Xxxxxx shall own less than 5% of the Company's outstanding
capital stock.
4. RIGHT OF FIRST REFUSAL.
4.1 SUBSEQUENT OFFERINGS. Xxxxxx shall have a right of first refusal to
purchase its pro rata share of all Equity Securities, as defined below, that the
Company may, from time to time, propose to sell and issue after the date of this
Agreement, other than the Equity Securities excluded by Section 4.6 hereof.
Xxxxxx'x pro rata share is equal to the ratio of (a) the number of shares of the
Company's Common Stock (including all shares of Common Stock issued or issuable
upon conversion of the Shares) which Xxxxxx is deemed to hold immediately prior
to the issuance of such Equity Securities to (b) the total number of shares of
10.
the Company's outstanding Common Stock (including all shares of Common Stock
issued or issuable upon conversion of the Shares or upon the exercise of any
outstanding warrants or options) immediately prior to the issuance of the Equity
Securities. The term "Equity Securities" shall mean (i) any Common Stock,
Preferred Stock or other security of the Company, (ii) any security convertible,
with or without consideration, into any Common Stock, Preferred Stock or other
security (including any option to purchase such a convertible security), (iii)
any security carrying any warrant or right to subscribe to or purchase any
Common Stock, Preferred Stock or other security or (iv) any such warrant or
right.
4.2 EXERCISE OF RIGHT. If the Company proposes to issue any Equity
Securities, it shall give Xxxxxx written notice of its intention, describing the
Equity Securities, the price and the terms and conditions upon which the Company
proposes to issue the same. Xxxxxx shall have forty-five (45) days from the
giving of such notice to agree to purchase its pro rata share of the Equity
Securities for the price and upon the terms and conditions specified in the
notice by giving written notice to the Company and stating therein the quantity
of Equity Securities to be purchased; provided, however, if the Company
reasonably requests in the Company's original notice that Xxxxxx respond within
thirty (30) days (due to timing considerations relating to the closing of the
issuance of such Equity Securities), then Xxxxxx shall be required to respond to
such notice within thirty (30) days. Notwithstanding the foregoing, the Company
shall not be required to offer or sell such Equity Securities to Xxxxxx if such
offer or sale would cause the Company to be in violation of applicable federal
securities laws by virtue of such offer or sale; provided, however, the Company
agrees to use its reasonable best efforts to take whatever action may be
necessary or appropriate to comply with applicable Federal Securities laws in
connection with such offer or sale.
4.3 ISSUANCE OF EQUITY SECURITIES TO OTHER PERSONS. If Xxxxxx does not
elect to purchase its pro rata share of the Equity Securities, then the Company
shall have ninety (90) days thereafter to sell the Equity Securities in respect
of which Xxxxxx'x rights were not exercised, at a price and upon general terms
and conditions materially no more favorable to the purchasers thereof than
specified in the Company's notice to Xxxxxx pursuant to Section 4.2 hereof. If
the Company has not sold such Equity Securities within ninety (90) days of the
notice provided pursuant to Section 4.2, the Company shall not thereafter issue
or sell any Equity Securities, without first offering such securities to Xxxxxx
in the manner provided above.
4.4 TERMINATION OF RIGHT OF FIRST REFUSAL. The right of first refusal
established by this Section 4 shall terminate on the first to occur of (i) the
effective date of the registration statement pertaining to the Company's Initial
Offering or (ii) the first date on which Xxxxxx sells, assigns or otherwise
transfers any of the Shares (other than to a subsidiary, affiliate or parent or
in connection with an assignment as provided in Section 7.5 of the Series B
Purchase Agreement or Section 7.5 of the Series B-1 Purchase Agreement, as
applicable). The right of first refusal shall not apply to the Company's Initial
Offering.
4.5 TRANSFER OF RIGHT OF FIRST REFUSAL. The right of first refusal of
the Investor under this Section 4 may be transferred to the same parties,
subject to the same restrictions as any transfer of registration rights pursuant
to Section 2.8
11.
4.6 EXCLUDED SECURITIES. The right of first refusal established by this
Section 4 shall have no application to any of the following Equity Securities:
(a) shares of Common Stock (and/or options, warrants or other
Common Stock purchase rights issued pursuant to such options, warrants or other
rights) issued or to be issued to employees, officers or directors of, or
consultants or advisors to the Company or any subsidiary, pursuant to stock
purchase or stock option plans or other arrangements that are approved by the
Board of Directors;
(b) stock issued pursuant to any rights, agreements, options or
warrants outstanding as of the date of this Agreement and stock issued pursuant
to any rights, agreements, options or warrants granted after the date of this
Agreement, provided that the rights of first refusal established by this Section
4 applied with respect to the initial sale or grant by the Company of such
rights, agreements, options or warrants;
(c) any Equity Securities issued for consideration other than cash
pursuant to a merger, consolidation, acquisition or similar business combination
whereby the stockholders of the Company will own more than fifty percent (50%)
of the voting power of the combined entity;
(d) shares of Common Stock issued in connection with any stock
split, stock dividend or recapitalization by the Company;
(e) shares of Common Stock issued upon conversion of the Shares or
the Series A Preferred Stock;
(f) any Equity Securities issued pursuant to any equipment leasing
arrangement; and
(g) shares of the Company's Common Stock or Preferred Stock issued
in connection with strategic transactions involving the Company and other
entities, including (i) joint ventures, manufacturing, marketing, corporate
partnering or distribution arrangements or (ii) technology transfer, research or
development arrangements; provided that such strategic transactions and the
issuance of shares therein, has been approved by the Company's Board of
Directors.
5. MISCELLANEOUS.
5.1 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of California, as applied to contracts executed and
performed entirely within the State of California, without regard to conflicts
of laws rules.
5.2 SURVIVAL. The representations, warranties, covenants, and
agreements made herein shall survive any investigation made by any Holder and
the closing of the transactions contemplated hereby. All statements as to
factual matters contained in any certificate or other instrument delivered by or
on behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
12.
5.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of Registrable Securities from time to time;
provided, however, that prior to the receipt by the Company of adequate written
notice of the transfer of any Registrable Securities specifying the full name
and address of the transferee, the Company may deem and treat the person listed
as the holder of such shares in its records as the absolute owner and holder of
such shares for all purposes, including the payment of dividends or any
redemption price.
5.4 SEVERABILITY. If one or more provisions of this Agreement is held
to be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of this Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
5.5 AMENDMENT AND WAIVER.
(a) Except as otherwise expressly provided, any provision of this
Agreement (other than Sections 3 and 4) may be amended and the observance
thereof may be waived (either generally or in a particular instance and either
retroactively or prospectively) only upon the written consent of the Company and
the Holders of at least a majority of the Registrable Securities. Any amendment
or waiver of any provisions of this Agreement (other than Sections 3 and 4)
effected in accordance with this Agreement shall be binding upon each Holder and
the Company. By acceptance of any benefits under this Agreement, Holders of
Registrable Securities hereby agree to be bound by the provisions hereunder.
(b) Except as otherwise expressly provided, any provision of
Section 3 and 4 of this Agreement may be amended and the observance thereof may
be waived (either generally or in a particular instance and either retroactively
or prospectively) only upon the written consent of the Company and Xxxxxx.
5.6 DELAYS OR OMISSIONS. It is agreed that no delay or omission to
exercise any right, power, or remedy accruing to any Holder, upon any breach,
default or noncompliance of the Company under this Agreement shall impair any
such right, power, or remedy, nor shall it be construed to be a waiver of any
such breach, default or noncompliance, or any acquiescence therein, or of any
similar breach, default or noncompliance thereafter occurring. It is further
agreed that any waiver, permit, consent, or approval of any kind or character on
any Holder's part of any breach, default or noncompliance under the Agreement or
any waiver on such Holder's part of any provisions or conditions of this
Agreement must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, by law, or otherwise afforded to Holders, shall be cumulative and not
alternative.
5.7 NOTICES. Any notice or report required or permitted to be given or
made under this Agreement by one of the parties hereto to the other shall be in
writing, delivered personally or by facsimile (and promptly confirmed by
personal delivery or courier) or courier, postage prepaid, addressed to such
other party at its address indicated below, or to such other address as the
13.
addressee shall have last furnished in writing to the addressor and shall be
effective upon receipt by the addressee.
THE COMPANY: Epimmune Inc.
0000 Xxxxx Xxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: President
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Xxxxxx Godward LLP
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
XXXXXX: X.X. Xxxxxx & Xx.
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Vice President, Business
Development
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to: X.X. Xxxxxx & Xx.
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: General Counsel
Tel: (000) 000-0000
Fax: (000) 000-0000
CYTEL: Cytel Corporation
0000 Xxxx Xxxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: President
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Xxxxxx Godward LLP
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
5.8 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
14.
5.9 PRONOUNS. All pronouns contained herein and any variations thereof
shall be deemed to refer to the masculine, feminine or neuter, singular or
plural, as the identity of the parties hereto may require.
5.10 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
15.
IN WITNESS WHEREOF, the parties hereto have executed this Investor
Rights Agreement as of the date set forth in the first paragraph hereof.
COMPANY: INVESTORS:
EPIMMUNE INC. X.X. XXXXXX & CO.
By: By:
----------------------------------- ----------------------------------
Title: Title:
-------------------------------- -------------------------------
CYTEL CORPORATION
By:
----------------------------------
Title:
-------------------------------
EXHIBIT C
EPIMMUNE INC.
VOTING AGREEMENT
THIS VOTING AGREEMENT (the "Agreement") is made and entered into this
27th day of February, 1998, by and among Epimmune Inc., a Delaware corporation
(the Company"), Cytel Corporation, a Delaware corporation (the "Key
Stockholder"), and X.X. Xxxxxx & Co., a Delaware corporation (the "Investor").
WITNESSETH:
WHEREAS, the Key Stockholder is the beneficial owner of an aggregate of
Six Million (6,000,000) shares of the Series A Preferred Stock (the "Series A
Preferred") of the Company;
WHEREAS, the Company proposes to sell shares (the "Investor Shares") of
its Series B Preferred Stock (the "Series B Preferred") to the Investor pursuant
to the Series B Preferred Stock Purchase Agreement (the "Series B Stock Purchase
Agreement") of even date herewith;
WHEREAS, the Company proposes to sell shares of its Series B-1
Preferred Stock (the "Series B-1 Preferred"), to the Key Stockholder pursuant to
the Series B-1 Preferred Stock Purchase Agreement (the "Series B-1 Stock
Purchase Agreement") of even date herewith (collectively, the sale of Series B
and Series B-1 Preferred Stock shall be referred to as the "Financing");
WHEREAS, in connection with the consummation of the Financing, the Key
Stockholder has agreed to provide for the future voting of its shares of the
Company's capital stock as set forth below; and
WHEREAS, this Agreement shall be effective only upon the closing of the
Series B Stock Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. VOTING.
1.1 SHARES. The Key Stockholder agrees to hold all shares of voting
capital stock of the Company (including but not limited to all shares of Common
Stock issued upon conversion of the Company's Series A Preferred and Series B-1
Preferred) registered in its name or beneficially owned by it as of the date
hereof (and any and all other securities of the Company legally or beneficially
acquired by the Key Stockholder after the date hereof) (hereinafter collectively
referred to as the "Shares") subject to, and to vote the Shares in accordance
with, the provisions of this Agreement.
1.2 ELECTION OF DIRECTOR. On all matters relating to the election of
directors of the Company, the Key Stockholder agrees to vote all Shares held by
1.
it (or the holders thereof shall consent pursuant to an action by written
consent of the stockholders) so as to elect to the Company's Board of Directors
one (1) individual nominated by the holders of a majority in interest of the
Investor Shares. On all matters relating to the election of directors of the
Company, the Investor agrees to vote all Investor Shares held by it (or the
holders thereof shall consent pursuant to an action by written consent of the
stockholders) so as to elect to the Company's Board of Directors one (1)
individual nominated by the holders of a majority in interest of the Investor
Shares. Any vote taken to remove any director elected pursuant to this Section
1.2, or to fill any vacancy created by the resignation of a director elected
pursuant to this Section 1.2, shall also be subject to the provisions of this
Section 1.2.
1.3 LEGEND.
(a) Concurrently with the execution of this Agreement, there shall
be imprinted or otherwise placed, on certificates representing the Shares, the
following restrictive legend (the "Legend"):
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TERMS AND CONDITIONS OF A VOTING AGREEMENT WHICH PLACES
CERTAIN RESTRICTIONS ON THE VOTING OF THE SHARES REPRESENTED
HEREBY. ANY PERSON ACCEPTING ANY INTEREST IN SUCH SHARES SHALL
BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE
PROVISIONS OF SUCH AGREEMENT. A COPY OF SUCH VOTING AGREEMENT
WILL BE FURNISHED TO THE RECORD HOLDER OF THIS CERTIFICATE
WITHOUT CHARGE UPON WRITTEN REQUEST TO THE COMPANY AT ITS
PRINCIPAL PLACE OF BUSINESS."
(b) The Company agrees that, during the term of this Agreement, it
will not remove, and will not permit to be removed (upon registration of
transfer, reissuance of otherwise), the Legend from any such certificate and
will place or cause to be placed the Legend on any new certificate issued to
represent Shares theretofore represented by a certificate carrying the Legend.
1.4 SUCCESSORS. The provisions of this Agreement shall be binding upon
the successors in interest to any of the Shares. The Company shall not permit
the transfer of any of the Shares on its books or issue a new certificate
representing any of the Shares unless and until the person to whom such security
is to be transferred shall have executed a written agreement, substantially in
the form of this Agreement, pursuant to which such person becomes a party to
this Agreement and agrees to be bound by all the provisions hereof as if such
person were a Key Stockholder or Investor, as applicable; provided that this
provision shall not apply to the extent of any sale or transfer of the Shares to
the Investor.
1.5 OTHER RIGHTS. Except as provided by this Agreement, the Key
Stockholder and Investor shall exercise the full rights of a stockholder with
respect to the Shares.
2.
2. TERMINATION
2.1 Agreement shall continue in full force and effect from the date
hereof through (i) the date that all of the Shares are sold or otherwise
transferred to the Investor, or (ii) the later of the following dates, on which
it shall terminate in its entirety:
(a) two (2) years from the date of the closing of a firm commitment
underwritten public offering of the Company's Common Stock pursuant to a
registration statement filed with, and declared effective under, the Securities
Act of 1933, as amended, in which the Company receives gross proceeds of at
least $15 million; or
(b) at such time as the Investor holds less than five percent (5%)
of the total shares of Common Stock and Preferred Stock outstanding of the
Company on a fully-diluted, as-converted basis.
3. MISCELLANEOUS
3.1 OWNERSHIP. The Key Stockholder represents and warrants to the
Investor that (a) it now owns the Shares, free and clear of liens or
encumbrances, and has not, prior to or on the date of this Agreement, executed
or delivered any proxy or entered into any other voting agreement or similar
arrangement other than one which has expired or terminated prior to the date
hereof, and (b) it has full power and capacity to execute, deliver and perform
this Agreement, which has been duly executed and delivered by, and evidences the
valid and binding obligation of, the Key Stockholder enforceable in accordance
with its terms.
3.2 FURTHER ACTION. If and whenever the Shares are sold, the Key
Stockholder or the personal representative of the Key Stockholder shall do all
things and execute and deliver all documents and make all transfers, and cause
any transferee of the Shares to do all things and execute and deliver all
documents, as may be necessary to consummate such sale consistent with this
Agreement.
3.3 SPECIFIC PERFORMANCE. The parties hereto hereby declare that it is
impossible to measure in money the damages which will accrue to a party hereto
or to their heirs, personal representatives, or assigns by reason of a failure
to perform any of the obligations under this Agreement and agree that the terms
of this Agreement shall be specifically enforceable. If any party hereto or his
heirs, personal representatives, or assigns institutes any action or proceeding
to specifically enforce the provisions hereof, any person against whom such
action or proceeding is brought hereby waives the claim or defense therein that
such party or such personal representative has an adequate remedy at law, and
such person shall not offer in any such action or proceeding the claim or
defense that such remedy at law exists.
3.4 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of California, as applied to contracts executed and
performed entirely within the State of California, without regard to conflicts
of laws rules.
3.5 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively) only with
the written consent of the parties hereto.
3.
3.6 SEVERABILITY. If one or more provisions of this Agreement is held
to be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of this Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
3.7 SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective permitted
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective permitted successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
3.8 ADDITIONAL SHARES. In the event that subsequent to the date of this
Agreement any shares or other securities (other than any shares or securities of
another corporation issued to the Company's stockholders pursuant to a plan of
merger) are issued on, or in exchange for, any of the Shares by reason of any
stock dividend, stock split, consolidation of shares, reclassification or
consolidation involving the Company, such shares or securities shall be deemed
to be Shares for purposes of this Agreement.
3.9 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
3.10 ENTIRE AGREEMENT. This Agreement, along with the Series B Stock
Purchase Agreement and each of the Exhibits thereto and the Series B-1 Stock
Purchase Agreement and each of the Exhibits thereto, constitute the full and
entire understanding and agreement between the parties with regard to the
subjects hereof and thereof and no party shall be liable or bound to any other
in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.
4.
IN WITNESS WHEREOF, the parties hereto have executed this Stockholders
Agreement as of the date first above written.
COMPANY: INVESTOR:
EPIMMUNE INC. X. X. XXXXXX & CO.
By: By:
----------------------------------- ---------------------------------
President Title:
------------------------------
KEY STOCKHOLDER:
CYTEL CORPORATION
By:
-----------------------------------
Title:
--------------------------------
EXHIBIT D
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
EPIMMUNE INC.
Xxxxxxx Xxxxxxxx and Xxxxxx X. Xxxxxxx, Ph.D. do hereby certify that:
FIRST: The original name of this corporation is Cytel Subsidiary, Inc.
and the date of filing the original Certificate of Incorporation of this
corporation with the Secretary of State of the State of Delaware is April 25,
1997.
SECOND: They are the duly elected and acting President and Secretary,
respectively, of Epimmune Inc., a Delaware corporation.
THIRD: The Certificate of Incorporation of this corporation is hereby
amended and restated to read as follows:
I.
The name of this Corporation is Epimmune Inc.
II.
The address of the registered office of the Corporation in the State of
Delaware is 1013 Centre Road, County of New Castle, and the name of the
registered agent of the Corporation in the State of Delaware at such address is
Corporation Service Company.
III.
The purpose of this Corporation is to engage in any lawful act or
activity for which a corporation may be organized under the General Corporation
Law of the State of Delaware.
IV.
A. This Corporation is authorized to issue two classes of stock to be
designated, respectively, "Common Stock" and "Preferred Stock." The total number
of shares which the corporation is authorized to issue is Thirty million
(30,000,000). Twenty million (20,000,000) shares shall be Common Stock, each
having a par value of one-tenth of one cent ($0.001). Ten million (10,000,000)
shares shall be Preferred Stock, each having a par value of one-tenth of one
cent ($0.001).
B. The number of authorized shares of Common Stock may be increased or
decreased (but not below the number of shares of Common Stock then outstanding)
by the affirmative vote of the holders of a majority of the stock of the
Corporation (voting together on an as-if-converted basis).
C. The rights, preferences, privileges, restrictions and other matters
relating to the Common Stock are as follows:
1. DIVIDEND RIGHTS. Subject to the rights of holders of all classes
of stock at the time outstanding having prior rights as to dividends, the
holders of the Common Stock shall be entitled to receive, when and as declared
by the Board of Directors, out of any assets of the Corporation legally
available therefor, such dividends as may be declared from time to time by the
Board of Directors.
2. VOTING RIGHTS. The holder of each share of Common Stock shall
have the right to one vote and shall be entitled to notice of any stockholders'
meeting in accordance with the By-laws of the Corporation and to vote upon such
matters and in such manner as regulated by law.
3. LIQUIDATION RIGHTS. Upon the liquidation, dissolution and
winding up of the Corporation, the assets of the Corporation shall be
distributed as provided in Section 3 of Division (F) of this Article III hereof.
4. REDEMPTIONS. The Common Stock is not redeemable.
D. The Preferred Stock may be issued from time to time in one or more
series. The Board of Directors is hereby authorized, within the limitations and
restrictions stated in this Certificate of Incorporation, to fix or alter the
dividend rights, dividend rate, conversion rights, voting rights, rights and
terms of redemption (including sinking fund provisions), the redemption price or
prices, the liquidation preferences of any wholly unissued series of Preferred
Stock, and the number of shares constituting any such series and the designation
thereof, or any of them; and to increase or decrease the number of shares of any
series subsequent to the issue of shares of that series, but not below the
number of shares of such series then outstanding. In case the number of shares
of any series shall be so decreased, the shares constituting such decrease shall
resume the status which they had prior to the adoption of the resolution
originally fixing the number of shares of such series. New series of Preferred
Stock may be issued on parity with prior series of Preferred Stock, but not on a
senior basis without stockholder approval of the outstanding Preferred Stock.
E. Six million (6,000,000) of the authorized shares of Preferred Stock
are hereby designated "Series A Preferred Stock" (the "Series A Preferred"), one
million thirty-two thousand one hundred forty-nine (1,032,149) of the authorized
shares of Preferred Stock are hereby designated "Series B Preferred Stock (the
"Series B Preferred") and six hundred fifty-nine thousand eight hundred
ninety-eight (659,898) of the authorized shares of Preferred Stock are hereby
designated "Series B-1 Preferred Stock (the "Series B-1 Preferred").
F. The rights, preferences, privileges, restrictions and other matters
relating to the Series A Preferred, the Series B Preferred and the Series B-1
Preferred are as follows:
1. DIVIDEND RIGHTS.
a. So long as any shares of Series A Preferred, Series B
Preferred or Series B-1 Preferred shall be outstanding, no dividend, whether in
cash or property, shall be paid or declared nor shall any other distribution be
made, on any Common Stock (other than any dividend or distribution payable
solely in Common Stock of the Corporation), unless a dividend is paid with
respect to all outstanding shares of Series A Preferred, Series B Preferred and
2.
Series B-1 Preferred in an amount per share (on an as-if-converted to Common
Stock basis) equal to the amount paid or set aside for each share of Common
Stock.
b. No dividend, whether in cash or property, shall be paid or
declared, nor shall any other distribution be made, on any series of Preferred
Stock unless at the same time an equal dividend shall be paid on the shares of
all other series of Preferred Stock.
2. VOTING RIGHTS.
a. GENERAL RIGHTS. Except as otherwise provided herein or as
required by law, the Series A Preferred, Series B Preferred and Series B-1
Preferred shall be voted equally with the shares of the Common Stock of the
Corporation and not as a separate class, at any annual or special meeting of
stockholders of the Corporation, and may act by written consent in the same
manner as the Common Stock, in either case upon the following basis: each holder
of shares of Series A Preferred, Series B Preferred and Series B-1 Preferred
shall be entitled to such number of votes as shall be equal to the whole number
of shares of Common Stock into which such holder's aggregate number of shares of
Series A Preferred, Series B Preferred and Series B-1 Preferred are convertible
(pursuant to Section 4 hereof) immediately after the close of business on the
record date fixed for such meeting or the effective date of such written
consent.
b. SEPARATE VOTE OF SERIES A PREFERRED. For so long as any
shares of Series A Preferred (subject to adjustment for any stock split, reverse
stock split or other similar event affecting the Series A Preferred) remain
outstanding, in addition to any other vote or consent required herein or by law,
the vote or written consent of the holders of at least a majority of the
outstanding Series A Preferred shall be necessary for effecting or validating
the following actions:
(i) Any amendment, alteration, or repeal of any provision of
this Certificate of Incorporation or the By-laws of the Corporation (including
any filing of a Certificate of Designation), that adversely changes the rights,
preferences, and privileges with respect to liquidation preference, voting or
dividends of the Series A Preferred; or
(ii) Any agreement by the Corporation that by its terms
restricts the Corporation from complying with the terms of the Series A
Preferred or performing its obligations under any agreements to which the
Corporation is a party pursuant to which the holder purchased such Series A
Preferred.
c. SEPARATE VOTE OF SERIES B PREFERRED. For so long as any
shares of Series B Preferred (subject to adjustment for any stock split, reverse
stock split or other similar event affecting the Series B Preferred) remain
outstanding, in addition to any other vote or consent required herein or by law,
the vote or written consent of the holders of at least a majority of the
outstanding Series B Preferred shall be necessary for effecting or validating
the following actions:
(i) Any amendment, alteration, or repeal of any provision of
this Certificate of Incorporation or the By-laws of the Corporation (including
3.
any filing of a Certificate of Designation), that adversely changes the rights,
preferences, and privileges with respect to liquidation preference, voting or
dividends of the Series B Preferred; or
(ii) Any agreement by the Corporation that by its terms,
restricts the Corporation from complying with the terms of the Series B
Preferred or performing its obligations under any agreements to which the
Corporation is a party pursuant to which the holder purchased such Series B
Preferred.
d. SEPARATE VOTE OF SERIES B-1 PREFERRED. For so long as any
shares of Series B-1 Preferred (subject to adjustment for any stock split,
reverse stock split or other similar event affecting the Series B Preferred)
remain outstanding, in addition to any other vote or consent required herein or
by law, the vote or written consent of the holders of at least a majority of the
outstanding Series B-1 Preferred shall be necessary for effecting or validating
the following actions:
(i) Any amendment, alteration, or repeal of any provision of
this Certificate of Incorporation or the By-laws of the Corporation (including
any filing of a Certificate of Designation), that adversely changes the rights,
preferences, and privileges with respect to liquidation preference, voting or
dividends of the Series B-1 Preferred; or
(ii) Any agreement by the Corporation that by its terms,
restricts the Corporation from complying with the terms of the Series B-1
Preferred or performing its obligations under any agreements to which the
Corporation is a party pursuant to which the holder purchased such Series B-1
Preferred.
3. LIQUIDATION RIGHTS.
a. Upon any liquidation, dissolution, or winding up of the
Corporation, whether voluntary or involuntary, before any distribution or
payment shall be made to the holders of the Common Stock, (i) the holders of
Series A Preferred shall be entitled to be paid out of the assets of the
Corporation an amount per share of Series A Preferred equal to $1.3308 (the
"Series A Original Issue Price") (as adjusted for any stock dividends,
combinations, splits, recapitalizations and the like with respect to such
shares) plus all declared and unpaid dividends on the Series A Preferred Stock
for each share of Series A Preferred held by them, (ii) the holders of Series B
Preferred shall be entitled to be paid out of the assets of the Corporation an
amount per share of Series B Preferred equal to $5.91 (the "Series B Original
Issue Price") (as adjusted for any stock dividends, combinations, splits,
recapitalizations and the like with respect to such shares) plus all declared
and unpaid dividends on the Series B Preferred Stock for each share of Series B
Preferred held by them, and (iii) the holders of Series B-1 Preferred shall be
entitled to be paid out of the assets of the Corporation an amount per share of
Series B-1 Preferred equal to $5.91 (the "Series B-1 Original Issue Price") (as
adjusted for any stock dividends, combinations, splits, recapitalizations and
the like with respect to such shares) plus all declared and unpaid dividends on
the Series B-1 Preferred Stock for each share of Series B-1 Preferred held by
them.
b. After the payment of the full liquidation preference of the
Series A Preferred, Series B Preferred and Series B-1 Preferred as set forth in
4.
Section 3(a) above, the remaining assets of the Corporation legally available
for distribution, if any, shall be distributed among the holders of the Common
Stock in proportion to the shares of Common Stock then held by them.
c. The following events shall be considered a liquidation under
this Section:
(i) any consolidation or merger of the Corporation with or
into any other corporation or other entity or person, or any other corporate
reorganization, in which the stockholders of the Corporation immediately prior
to such consolidation, merger or reorganization, own less than fifty percent
(50%) of the Corporation's voting power immediately after such consolidation,
merger or reorganization, or any transaction or series of related transactions
in which in excess of fifty percent (50%) of the Corporation's voting power is
transferred (an "Acquisition"); or
(ii) a sale, lease or other disposition of all or
substantially all of the assets of the Corporation (an "Asset Transfer").
d. If, upon any liquidation, distribution, or winding up, the
assets of the Corporation shall be insufficient to make payment in full to all
holders of Series A Preferred, the Series B Preferred and the Series B-1
Preferred of the liquidation preference set forth in Section 3(a), then such
assets shall be distributed among the holders of Series A Preferred, the Series
B Preferred and the Series B-1 Preferred at the time outstanding, ratably in
proportion to the full amounts to which they would otherwise be respectively
entitled.
4. CONVERSION RIGHTS.
The holders of the Series A Preferred, Series B Preferred and
Series B-1 Preferred shall have the following rights with respect to conversion
of such shares into shares of Common Stock (the "Conversion Rights"):
a. OPTIONAL CONVERSION. Subject to and in compliance with the
provisions of this Section 4, any shares of Series A Preferred, Series B
Preferred and Series B-1 Preferred may, at the option of the holder, be
converted at any time into fully paid and nonassessable shares of Common Stock.
The number of shares to which a holder of Series A Preferred shall be entitled
upon conversion shall be the product obtained by multiplying the "Series A
Conversion Rate" then in effect (determined as provided in Section 4(b)) by the
number of shares of Series A Preferred being converted. The number of shares to
which a holder of Series B Preferred shall be entitled upon conversion shall be
the product obtained by multiplying the "Series B Conversion Rate" then in
effect (determined as provided in Section 4(b)) by the number of shares of
Series B Preferred being converted. The number of shares to which a holder of
Series B-1 Preferred shall be entitled upon conversion shall be the product
obtained by multiplying the "Series B-1 Conversion Rate" then in effect
(determined as provided in Section 4(b)) by the number of shares of Series B-1
Preferred being converted.
b. CONVERSION RATES. The conversion rate in effect at any time
for conversion of the Series A Preferred (the "Series A Conversion Rate") shall
be the quotient obtained by dividing the Series A Original Issue Price by the
"Series A Conversion Price," calculated as provided in Section 4(c). The
5.
conversion rate in effect at any time for conversion of the Series B Preferred
(the "Series B Conversion Rate") shall be the quotient obtained by dividing the
Series B Original Issue Price by the "Series B Conversion Price," calculated as
provided in Section 4(c). The conversion rate in effect at any time for
conversion of the Series B-1 Preferred (the "Series B-1 Conversion Rate") shall
be the quotient obtained by dividing the Series B Original Issue Price by the
"Series B-1 Conversion Price," calculated as provided in Section 4(c).
c. CONVERSION PRICES. The conversion price for the Series A
Preferred shall initially be the Series A Original Issue Price (the "Series A
Conversion Price"). The conversion price for the Series B Preferred shall
initially be the Series B Original Issue Price (the "Series B Conversion
Price"). The conversion price for the Series B-1 Preferred shall initially be
the Series B-1 Original Issue Price (the "Series B-1 Conversion Price"). The
initial Series A, Series B and Series B-1 Conversion Prices shall be adjusted
from time to time in accordance with this Section 4. All references to the
Series A, Series B and Series B-1 Conversion Prices herein shall mean the Series
A, Series B and Series B-1 Conversion Prices as so adjusted.
d. AUTOMATIC CONVERSION. Each share of Series A, Series B and
Series B-1 Preferred shall automatically be converted into shares of Common
Stock, based on the then-effective Series A Conversion Price, Series B
Conversion Price or Series C Conversion Price, as applicable, upon the closing
of a firm commitment underwritten public offering pursuant to an effective
registration statement under the Securities Act of 1933, as amended (the "Act"),
covering the offer and sale by the Corporation of Common Stock to the public in
which the Company receives gross proceeds of at least $15 million.
e. MECHANICS OF CONVERSION. Before any holder of Preferred Stock
shall be entitled to convert the same into shares of Common Stock pursuant to
Section 4(a) hereof, and before the Corporation shall be obligated to issue
certificates for shares of Common Stock upon the automatic conversion of the
Preferred Stock pursuant to Section 4(d) hereof, such holder shall surrender the
certificate or certificates thereof, duly endorsed, at the office of the
Corporation or of any transfer agent for such stock, and shall give written
notice to the Corporation at such office that such holder elects to convert the
same and shall state therein the name or names in which such holder wishes the
certificate or certificates for shares of Common Stock to be issued (except that
no such written notice of intent to convert shall be necessary in the event of
an automatic conversion pursuant to Section 4(d) hereof). The Corporation shall,
as soon as practicable thereafter, issue and deliver at such office to such
holder of Preferred Stock or its nominee or nominees, a certificate or
certificates for the number of shares of Common Stock to which such holder shall
be entitled as aforesaid, together with cash in lieu of any fractional shares.
Such conversion shall be deemed to have been made immediately prior to the close
of business on the date of surrender of the shares of Preferred Stock to be
converted, except that in the case of an automatic conversion pursuant to
Section 4(d) hereof, such conversion shall be deemed to have been made
immediately prior to the date of the offering referred to in Section 4(d) . The
person or persons entitled to receive the shares of Common Stock issuable upon
such conversion shall be treated for all purposes as the record holder or
holders of such shares of Common Stock on such date.
6.
f. ADJUSTMENT FOR STOCK SPLITS AND COMBINATIONS. If the
Corporation shall at any time or from time to time after the date that the first
share of Series B Preferred is issued (the "Original Issue Date") effect a
subdivision of the outstanding Common Stock without a corresponding subdivision
of the Preferred Stock, the Series A Conversion Price, Series B Conversion Price
and Series B-1 Conversion Price in effect immediately before that subdivision
shall be proportionately decreased. Conversely, if the Corporation shall at any
time or from time to time after the Original Issue Date combine the outstanding
shares of Common Stock into a smaller number of shares without a corresponding
combination of the Preferred Stock, the Series A Conversion Price, Series B
Conversion Price and Series B-1 Conversion Price in effect immediately before
the combination shall be proportionately increased. Any adjustment under this
Section 4(f) shall become effective at the close of business on the date the
subdivision or combination becomes effective.
g. ADJUSTMENT FOR COMMON STOCK DIVIDENDS AND DISTRIBUTIONS. If
the Corporation at any time or from time to time after the Original Issue Date
makes, or fixes a record date for the determination of holders of Common Stock
entitled to receive, a dividend or other distribution payable in additional
shares of Common Stock, in each such event the Series A Conversion Price, Series
B Conversion Price and Series B-1 Conversion Price that is then in effect shall
be decreased as of the time of such issuance or, in the event such record date
is fixed, as of the close of business on such record date, by multiplying the
Series A Conversion Price, Series B Conversion Price and Series B-1 Conversion
Price then in effect by a fraction (i) the numerator of which is the total
number of shares of Common Stock issued and outstanding immediately prior to the
time of such issuance or the close of business on such record date, and (ii) the
denominator of which is the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the close of
business on such record date plus the number of shares of Common Stock issuable
in payment of such dividend or distribution; provided, however, that if such
record date is fixed and such dividend is not fully paid or if such distribution
is not fully made on the date fixed therefor, the Series A Conversion Price,
Series B Conversion Price and Series B-1 Conversion Price shall be recomputed
accordingly as of the close of business on such record date and thereafter the
Series A Conversion Price, Series B Conversion Price and Series B-1 Conversion
Price shall be adjusted pursuant to this Section 4(g) to reflect the actual
payment of such dividend or distribution.
h. ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS. If the
Corporation at any time or from time to time after the Original Issue Date
makes, or fixes a record date for the determination of holders of Common Stock
entitled to receive, a dividend or other distribution payable in securities of
the Corporation other than shares of Common Stock, in each such event provision
shall be made so that the holders of the Series A Preferred, Series B Preferred
and Series B-1 Preferred shall receive upon conversion thereof, in addition to
the number of shares of Common Stock receivable thereupon, the amount of other
securities of the Corporation which they would have received had their Series A
Preferred, Series B Preferred or Series B-1 Preferred been converted into Common
Stock on the date of such event and had they thereafter, during the period from
the date of such event to and including the conversion date, retained such
securities receivable by them as aforesaid during such period, subject to all
other adjustments called for during such period under this Section 4 with
respect to the rights of the holders of the Series A Preferred, Series B
Preferred and Series B-1 Preferred or with respect to such other securities by
their terms.
7.
i. ADJUSTMENT FOR RECLASSIFICATION, EXCHANGE AND SUBSTITUTION.
If at any time or from time to time after the Original Issue Date, the Common
Stock issuable upon the conversion of the Series A Preferred, Series B Preferred
or Series B-1 Preferred is changed into the same or a different number of shares
of any class or classes of stock, whether by recapitalization, reclassification
or otherwise (other than an Acquisition or Asset Transfer as defined in Section
3(c) or a subdivision or combination of shares or stock dividend or a
reorganization, merger, consolidation or sale of assets provided for elsewhere
in this Section 4), in any such event each holder of Series A Preferred, Series
B Preferred or Series B-1 Preferred, as applicable, shall have the right
thereafter to convert such stock into the kind and amount of stock and other
securities and property receivable upon such recapitalization, reclassification
or other change by holders of the maximum number of shares of Common Stock into
which such shares of Series A Preferred, Series B Preferred or Series B-1
Preferred could have been converted immediately prior to such recapitalization,
reclassification or change, all subject to further adjustment as provided herein
or with respect to such other securities or property by the terms thereof.
j. REORGANIZATIONS, MERGERS, CONSOLIDATIONS OR SALES OF ASSETS.
If at any time or from time to time after the Original Issue Date, there is a
capital reorganization of the Common Stock (other than an Acquisition or Asset
Transfer as defined in Section 3(c) or a recapitalization, subdivision,
combination, reclassification, exchange or substitution of shares provided for
elsewhere in this Section 4), as a part of such capital reorganization,
provision shall be made so that the holders of the Series A Preferred, Series B
Preferred or Series B-1 Preferred, as applicable, shall thereafter be entitled
to receive upon conversion of the Series A Preferred, Series B Preferred or
Series B-1 Preferred the number of shares of stock or other securities or
property of the Corporation to which a holder of the number of shares of Common
Stock deliverable upon conversion would have been entitled on such capital
reorganization, subject to adjustment in respect of such stock or securities by
the terms thereof. In any such case, appropriate adjustment shall be made in the
application of the provisions of this Section 4 with respect to the rights of
the holders of Series A Preferred, Series B Preferred or Series B-1 Preferred
after the capital reorganization to the end that the provisions of this Section
4 (including adjustment of the Series A Conversion Price, Series B Conversion
Price or Series B-1 Conversion Price then in effect and the number of shares
issuable upon conversion of the Series A Preferred, Series B Preferred or Series
B-1 Preferred) shall be applicable after that event and be as nearly equivalent
as practicable.
k. SALE OF SHARES BELOW THE CONVERSION PRICES.
(i) If the Corporation issues or sells, or is deemed by the
express provisions of this Section 4(k) to have issued or sold, Additional
Shares of Common Stock (as hereinafter defined), other than as a dividend or
other distribution on any class of stock as provided in Section 4(g) above, and
other than a subdivision or combination of shares of Common Stock as provided in
Section 4(f) above, for an Effective Price (as hereinafter defined) less than
the then effective Series A Conversion Price, Series B Conversion Price or
Series B-1 Conversion Price, as the case may be, then, and in each such case,
the then existing Series A Conversion Price, Series B Conversion Price or Series
B-1 Conversion Price, as the case may be, shall be reduced, as of the opening of
business on the date of such issue or sale, to a price determined by multiplying
the Series A Conversion Price, the Series B Conversion Price or the Series B-1
8.
Conversion Price, as the case may be, by a fraction (1) the numerator of which
shall be (A) the number of shares of Common Stock deemed outstanding (as defined
below) immediately prior to such issue or sale, plus (B) the number of shares of
Common Stock which the aggregate consideration received (as determined by the
provisions of Section 4(k)(ii)) by the Corporation for the total number of
Additional Shares of Common Stock so issued would purchase at such Series A
Conversion Price, Series B Conversion Price or Series B-1 Conversion Price, as
the case may be, and (2) the denominator of which shall be (A) the number of
shares of Common Stock deemed outstanding (as defined below) immediately prior
to such issue or sale plus (B) the total number of Additional Shares of Common
Stock so issued. For the purposes of the preceding sentence, the number of
shares of Common Stock deemed to be outstanding as of a given date shall be the
sum of (a) the number of shares of Common Stock actually outstanding, (b) the
number of shares of Common Stock into which the then outstanding shares of
Series A Preferred, Series B Preferred and Series B-1 Preferred could be
converted if fully converted on the day immediately preceding the given date,
and (c) the number of shares of Common Stock which could be obtained through the
exercise or conversion of all other rights, options and convertible securities
on the day immediately preceding the given date.
(ii) For the purpose of making any adjustment required under
this Section 4(k), the consideration received by the Corporation for any issue
or sale of securities shall (A) to the extent it consists of cash, be computed
at the net amount of cash received by the Corporation after deduction of any
underwriting or similar commissions, compensation or concessions paid or allowed
by the Corporation in connection with such issue or sale but without deduction
of any expenses payable by the Corporation, (B) to the extent it consists of
property other than cash, be computed at the fair value of that property as
determined in good faith by the Board of Directors, and (C) if Additional Shares
of Common Stock, Convertible Securities (as hereinafter defined) or rights or
options to purchase either Additional Shares of Common Stock or Convertible
Securities are issued or sold together with other stock or securities or other
assets of the Corporation for a consideration which covers both, be computed as
the portion of the consideration so received that may be reasonably determined
in good faith by the Board of Directors to be allocable to such Additional
Shares of Common Stock, Convertible Securities or rights or options.
(iii) For the purpose of the adjustment required under this
Section 4(k), if the Corporation issues or sells any rights or options for the
purchase of, or stock or other securities convertible into, Additional Shares of
Common Stock (such convertible stock or securities being herein referred to as
"Convertible Securities") and if the Effective Price of such Additional Shares
of Common Stock is less than the Series A Conversion Price, Series B Conversion
Price or Series B-1 Conversion Price, as applicable, in each case the
Corporation shall be deemed to have issued at the time of the issuance of such
rights or options or Convertible Securities the maximum number of Additional
Shares of Common Stock issuable upon exercise or conversion thereof and to have
received as consideration for the issuance of such shares an amount equal to the
total amount of the consideration, if any, received by the Corporation for the
issuance of such rights or options or Convertible Securities, plus, in the case
of such rights or options, the minimum amounts of consideration, if any, payable
to the Corporation upon the exercise of such rights or options, plus, in the
case of Convertible Securities, the minimum amounts of consideration, if any,
payable to the Corporation (other than by cancellation of liabilities or
obligations evidenced by such Convertible Securities) upon the conversion
9.
thereof; provided that if, in the case of Convertible Securities, the minimum
amounts of such consideration cannot be ascertained, but are a function of
antidilution or similar protective clauses, the Corporation shall be deemed to
have received the minimum amounts of consideration without reference to such
clauses; provided further that if the minimum amount of consideration payable to
the Corporation upon the exercise or conversion of rights, options or
Convertible Securities is reduced over time or on the occurrence or
non-occurrence of specified events other than by reason of antidilution
adjustments, the Effective Price shall be recalculated using the figure to which
such minimum amount of consideration is reduced; provided further that, if the
minimum amount of consideration payable to the Corporation upon the exercise or
conversion of such rights, options or Convertible Securities is subsequently
increased, the Effective Price shall be again recalculated using the increased
minimum amount of consideration payable to the Corporation upon the exercise or
conversion of such rights, options or Convertible Securities. No further
adjustment of the Series A Conversion Price, Series B Conversion Price or Series
B-1 Conversion Price, as adjusted upon the issuance of such rights, options or
Convertible Securities, shall be made as a result of the actual issuance of
Additional Shares of Common Stock on the exercise of any such rights or options
or the conversion of any such Convertible Securities. If any such rights or
options or the conversion privilege represented by any such Convertible
Securities shall expire without having been exercised, the Series A Conversion
Price, Series B Conversion Price or Series B-1 Conversion Price as adjusted upon
the issuance of such rights, options or Convertible Securities shall be
readjusted to the Series A Conversion Price, Series B Conversion Price or Series
B-1 Conversion Price which would have been in effect had an adjustment been made
on the basis that the only Additional Shares of Common Stock so issued were the
Additional Shares of Common Stock, if any, actually issued or sold on the
exercise of such rights or options or rights of conversion of such Convertible
Securities, and such Additional Shares of Common Stock, if any, were issued or
sold for the consideration actually received by the Corporation upon such
exercise, plus the consideration, if any, actually received by the Corporation
for the granting of all such rights or options, whether or not exercised, plus
the consideration received for issuing or selling the Convertible Securities
actually converted, plus the consideration, if any, actually received by the
Corporation (other than by cancellation of liabilities or obligations evidenced
by such Convertible Securities) on the conversion of such Convertible
Securities, provided that such readjustment shall not apply to prior conversions
of Series A Preferred, Series B Preferred and Series B-1 Preferred.
(iv) "Additional Shares of Common Stock" shall mean all
shares of Common Stock issued by the Corporation or deemed to be issued pursuant
to this Section 4(k), whether or not subsequently reacquired or retired by the
Corporation other than (A) shares of Common Stock issued upon conversion of the
Series A Preferred, Series B Preferred or Series B-1 Preferred; and (B) shares
of Common Stock and/or options, warrants or other Common Stock purchase rights,
and the Common Stock issued pursuant to such options, warrants or other rights
(as adjusted for any stock dividends, combinations, splits, recapitalizations
and the like) after the Original Issue Date to employees, officers or directors
of, or consultants or advisors to, the Corporation or any subsidiary pursuant to
stock purchase or stock option plans or other arrangements that are approved by
the Board. The "Effective Price" of Additional Shares of Common Stock shall mean
the quotient determined by dividing the total number of Additional Shares of
Common Stock issued or sold, or deemed to have been issued or sold by the
Corporation under this Section 4(k), into the aggregate consideration received,
10.
or deemed to have been received by the Corporation for such issue under this
Section 4(k), for such Additional Shares of Common Stock.
l. NO IMPAIRMENT. The Corporation will not, by amendment of its
Certificate of Incorporation, by filing a Certificate of Designation or through
any reorganization, transfer of assets, consolidation, merger, dissolution,
issue or sale of securities or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms to be observed or
performed hereunder by the Corporation but will at all times in good faith
assist in the carrying out of all the provisions of this Section 4 and in the
taking of all such action as may be necessary or appropriate in order to protect
the Conversion Rights of the holders of Preferred Stock against impairment.
m. CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the number of shares of Common Stock issuable upon
conversion of a share of Preferred Stock pursuant to this Section 4, the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of Preferred Stock a certificate setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based. The Corporation shall, upon the written request at any
time of any holder of Preferred Stock, furnish or cause to be furnished to such
holder a like certificate prepared by the Corporation setting forth (i) such
adjustments and readjustments, (ii) the Conversion Price for such series of
Preferred Stock at the time in effect, and (iii) the number of shares of Common
Stock and the amount, if any, of other property which at the time would be
received upon the conversion of the Series A Preferred, Series B Preferred or
Series B-1 Preferred, as applicable.
n. NOTICES OF RECORD DATE. In the event of any taking by the
Corporation of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any
dividend (other than a cash dividend) or other distribution, any security or
right convertible into or entitling the holder thereof to receive additional
shares of Common Stock, or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities or property, or
to receive any other right, the Corporation shall mail to each holder of
Preferred Stock at least 10 days prior to the date specified therein, a notice
specifying the date on which any such record is to be taken for the purpose of
such dividend, distribution, security or right, and the amount and character of
such dividend, distribution, security or right.
o. ISSUE TAXES. The holders of Series A Preferred, Series B
Preferred and Series B-1 Preferred shall pay any and all issue, transfer and
other taxes that may be payable in respect of any issue or delivery of shares of
Common Stock on conversion of shares of Series A Preferred, Series B Preferred
and Series B-1 Preferred pursuant hereto.
p. RESERVATION OF STOCK ISSUABLE UPON CONVERSION. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of effecting the
conversion of the shares of the Series A Preferred, Series B Preferred and
Series B-1 Preferred, such number of its shares of Common Stock as shall from
time to time be sufficient to effect the conversion of all outstanding shares of
Series A Preferred, Series B Preferred and Series B-1 Preferred; and if at any
11.
time the number of authorized but unissued shares of Common Stock shall not be
sufficient to effect the conversion of all then outstanding shares of Series A
Preferred, Series B Preferred and Series B-1 Preferred, the Corporation will
take such corporate action as may, in the opinion of its counsel, be necessary
to increase its authorized but unissued shares of Common Stock to such number of
shares as shall be sufficient for such purpose, including, without limitation,
engaging in best efforts to obtain the requisite stockholder approval of any
necessary amendment to the Certificate of Incorporation. All shares of Common
Stock which are issuable upon such conversion shall, when issued, be duly and
validly issued, fully paid and nonassessable and free of all taxes, liens and
charges.
q. FRACTIONAL SHARES. No fractional share shall be issued upon
the conversion of any share or shares of Series A Preferred, Series B Preferred
or Series B-1 Preferred. All shares of Common Stock (including fractions
thereof) issuable upon conversion of more than one share of Preferred Stock by a
holder thereof shall be aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in the issuance of a
fraction of a share of Common Stock, the Corporation shall, in lieu of issuing
any fractional share, pay the holder otherwise entitled to such fraction a sum
in cash equal to the fair market value of such fraction on the date of
conversion (as determined in good faith by the Board of Directors).
5. REDEMPTION. The Series A Preferred, Series B Preferred and
Series B-1 Preferred shall not be redeemable by the Corporation.
6. NO REISSUANCE OF SERIES A PREFERRED, SERIES B PREFERRED OR
SERIES B-1 PREFERRED. No share or shares of Series A Preferred, Series B or
Series B-1 Preferred acquired by the Corporation by reason of redemption,
purchase, conversion or otherwise shall be reissued.
7. NO PREEMPTIVE RIGHTS. Stockholders shall have no preemptive
rights except as granted by the Corporation pursuant to written agreements.
V.
For the management of the business and for the conduct of the affairs
of the Corporation, and in further definition, limitation and regulation of the
powers of the Corporation, of its directors and of its stockholders or any class
thereof, as the case may be, it is further provided that:
A. The management of the business and the conduct of the affairs of the
Corporation shall be vested in its Board of Directors. The number of directors
which shall constitute the whole Board of Directors shall be fixed by the Board
of Directors in the manner provided in the By-laws.
B. The Board of Directors may from time to time make, amend, supplement
or repeal the By-laws; provided, however, that the stockholders may change or
repeal any By-law adopted by the Board of Directors by the affirmative vote of
the holders of a majority of the voting power of all of the then outstanding
shares of the capital stock of the Corporation; and, provided further, that no
amendment or supplement to the By-laws adopted by the Board of Directors shall
12.
vary or conflict with any amendment or supplement thus adopted by the
stockholders.
C. The directors of the Corporation need not be elected by written
ballot unless the By-laws so provide.
VI.
A. A director of the Corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for any breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation
Law, or (iv) for any transaction from which the director derived an improper
personal benefit. If the Delaware General Corporation Law is amended after
approval by the stockholders of this Article to authorize corporate action
further eliminating or limiting the personal liability of directors, then the
liability of a director shall be eliminated or limited to the fullest extent
permitted by the Delaware General Corporation Law, as so amended.
B. Any repeal or modification of this Article VI shall be prospective
and shall not affect the rights under this Article VI in effect at the time of
the alleged occurrence of any act or omission to act giving rise to liability or
indemnification.
VII.
The Corporation reserves the right to amend, alter, change or repeal
any provision contained in this Certificate of Incorporation, in the manner now
or hereafter prescribed by statute, and all rights conferred upon the
stockholders herein are granted subject to this reservation.
FOURTH: This Amended and Restated Certificate of Incorporation has been
duly approved by the Board of Directors of this Corporation.
FIFTH: This Amended and Restated Certificate of Incorporation has been
duly adopted in accordance with the provisions of Sections 228 and 245 of the
General Corporation Law of the State of Delaware by the Board of Directors and
the stockholders of the Corporation. The total number of outstanding shares
entitled to vote or act by written consent was 6,000,000 shares of Series A
Preferred Stock. A majority of the outstanding shares of Series A Preferred
Stock approved this Amended and Restated Certificate of Incorporation by written
consent in accordance with Section 228 of the General Corporation Law of the
State of Delaware and written notice was given by the Corporation in accordance
with said Section 228.
13.
IN WITNESS WHEREOF, Epimmune Inc. has caused this Amended and Restated
Certificate of Incorporation to be signed by the President and Secretary in San
Diego, California this _____ day of _____________, 1998.
EPIMMUNE INC.
-------------------------------------
Xxxxxxx Xxxxxxxx, President
ATTEST:
------------------------------------
Xxxxxx X. Xxxxxxx, Secretary
EXHIBIT E
COOLEY GODWARD LLP
ATTORNEYS AT LAW San Francisco, CA
000 000-0000
0000 Xxxxxxxxx Xxxxx Xxxx Xxxx, XX
Suite 1100 000 000-0000
Xxx Xxxxx, XX
00000-0000 Xxxxx Xxxx, XX
Main 619 550-6000 000 000-0000
Fax 000 000-0000
Boulder, CO
February 27, 1998 000 000-0000
xxx.xxxxxx.xxx Denver, CO
000 000-0000
XXXXXXXXX X. XXXX
000 000-0000
xxxxxx@xxxxxx.xxx
X.X. Xxxxxx & Co.
0000 Xxx Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Dear Ladies and Gentlemen:
We have acted as counsel for Epimmune Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of 1,032,149 shares
of the Company's Series B Preferred Stock ("Shares") pursuant to the Series B
Stock Purchase Agreement dated as of February 27, 1998 (the "Agreement"). We are
rendering this opinion pursuant to Section 4.7 of the Agreement. Except as
otherwise defined herein, capitalized terms used but not defined herein have the
respective meanings given to them in the Agreement.
In connection with this opinion, we have examined and relied upon the
representations and warranties as to factual matters contained in and made
pursuant to the Agreement by the various parties and originals or copies
certified to our satisfaction, of such records, documents, certificates,
opinions, memoranda and other instruments as in our judgment are necessary or
appropriate to enable us to render the opinion expressed below. Where we render
an opinion "to the best of our knowledge" or concerning an item "known to us" or
our opinion otherwise refers to our knowledge, it is based solely upon (i) an
inquiry of attorneys within this firm who perform legal services for the
Company, (ii) receipt of a certificate executed by an officer of the Company
covering such matters, a copy of which is attached hereto, and (iii) such other
investigation, if any, that we specifically set forth herein.
In rendering this opinion, we have assumed: the genuineness and authenticity of
all signatures on original documents; the authenticity of all documents
submitted to us as originals; the conformity to originals of all documents
submitted to us as copies; the accuracy, completeness and authenticity of
certificates of public officials; and the due authorization, execution and
delivery of all documents (except the due authorization, execution and delivery
by the Company of the Agreement, the Voting Agreement and the Investor Rights
Agreement), where authorization, execution and delivery are prerequisites to the
effectiveness of such documents. We have also assumed: that all individuals
executing and delivering documents had the legal capacity to so execute and
deliver; that you have received all documents you were to receive under the
Agreement; that the Agreement, the Voting Agreement and the Investor Rights
Agreement are obligations binding upon you; that you have filed any required
California franchise or income tax returns and have paid any required California
franchise or income taxes; and that there are no extrinsic agreements or
understandings among the parties to the Agreement and the Investor Rights
Agreement that would modify or interpret the terms thereof or the respective
rights or obligations of the parties thereunder.
XXXXXX GODWARD LLP
X.X. Xxxxxx & Co.
February 27, 1998
Page Two
Our opinion is expressed only with respect to the federal laws of the United
States of America, the laws of the State of California and the General
Corporation Law of the State of Delaware. We express no opinion as to whether
the laws of any particular jurisdiction apply, and no opinion to the extent that
the laws of any jurisdiction other than those identified above are applicable to
the subject matter hereof. We are not rendering any opinion as to compliance
with any antifraud law, rule or regulation relating to securities, or to the
sale or issuance thereof.
With regard to our opinion in paragraph 4 below, we have examined and relied
upon a certificate executed by an officer of the Company, a copy of which is
attached hereto, to the effect that the consideration for all outstanding shares
of capital stock of the Company was received by the Company in accordance with
the provisions of the applicable Board of Directors resolutions and any plan or
agreement relating to the issuance of such shares, and we have undertaken no
independent verification with respect thereto.
On the basis of the foregoing, in reliance thereon and with the foregoing
qualifications, we are of the opinion that:
1. The Company has been duly incorporated and is a validly existing
corporation in good standing under the laws of the State of Delaware.
2. The Company has the requisite corporate power to own or lease its
property and assets and to conduct its business as it is currently being
conducted and is qualified to do business as a foreign corporation in
California.
3. The Agreement, the Voting Agreement and the Investor Rights Agreement
have been duly and validly authorized, executed and delivered by the Company and
constitute valid and binding agreements of the Company enforceable against the
Company in accordance with their respective terms, except as rights to indemnity
under Section 2.7 of the Investor Rights Agreement may be limited by applicable
laws and except (i) as limited by applicable bankruptcy, insolvency,
reorganization, arrangement, moratorium and other laws of general applicability
relating to or affecting creditors' rights, and (ii) as limited by equitable
principles generally and limitations on the availability of equitable remedies,
whether such enforceability is considered in a proceeding in equity or at law.
4. The Company's authorized capital stock consists of twenty million
(20,000,000) shares of Common Stock, $0.001 par value, of which no shares are
issued and outstanding, and (b) ten million (10,000,000) shares of Preferred
Stock, $0.001 par value, of which (i) six million (6,000,000) shares have been
designated Series A Preferred Stock, $0.001 par value, of which six million
(6,000,000) shares are issued and outstanding; (ii) one million thirty two
thousand one hundred forty-nine (1,032,149) shares have been designated Series B
Preferred Stock, $0.001 par value, of which no shares were issued and
outstanding prior to the Closing; and (iii) six hundred fifty-nine thousand
eight hundred ninety-eight (659,898) shares have been designated Series B-1
XXXXXX GODWARD LLP
X.X. Xxxxxx & Co.
February 27, 1998
Page Three
Preferred Stock, $0.001 par value, of which no shares were issued and
outstanding prior to the Closing. The rights, preferences and privileges of the
Series A Preferred Stock, Series B Preferred Stock and Series B-1 Preferred
Stock are as stated in the Restated Certificate. The Shares have been duly
authorized, and upon issuance and delivery against payment therefor in
accordance with the terms of the Agreement, the Shares will be validly issued,
outstanding, fully paid and nonassessable. The shares of Common Stock issuable
upon conversion of the Shares have been duly authorized, and upon issuance and
delivery upon conversion of the Shares in accordance with the terms of the
Shares, will be validly issued, outstanding, fully paid and nonassessable. To
the best of our knowledge, there are no options, warrants, conversion
privileges, preemptive rights or other rights presently outstanding to purchase
any of the authorized but unissued capital stock of the Company, other than the
conversion privileges of the Series A Preferred Stock, Series B Preferred Stock
and Series B-1 Preferred Stock, rights created in connection with the
transactions contemplated by the Agreement and the Investor Rights Agreement,
and one million nine hundred twenty thousand (1,920,000) shares reserved for
issuance under the Company's 1997 Stock Option Plan.
5. The execution and delivery of the Agreement, the Voting Agreement and
the Investor Rights Agreement by the Company, and the performance by the Company
of the Agreement, the Voting Agreement and the Investor Rights Agreement, do not
violate any provision of the Company's Certificate of Incorporation or By-Laws,
and do not violate or contravene (a) any governmental statute, rule or
regulation applicable to the Company or (b) any order, writ, judgment,
injunction, decree, determination or award which has been entered against the
Company and of which we are aware, the violation or contravention of which would
materially and adversely affect the Company, its assets, financial condition or
operations.
6. To the best of our knowledge, there is no action, proceeding or
investigation pending or threatened in writing against the Company before any
court or administrative agency that questions the validity of the Agreement, the
Voting Agreement or the Investor Rights Agreement or that challenges the
consummation of the transactions contemplated thereby or might result, either
individually or in the aggregate, in any material adverse change in the assets,
financial condition, or operations of the Company.
7. The offer and sale of the Shares is exempt from the registration
requirements of the Securities Act of 1933, as amended.
8. All consents, approvals, authorizations, or orders of, and filings,
registrations, and qualifications with any regulatory authority or governmental
body in the United States required for the issuance by the Company of the
Shares, have been made or obtained, except for the filing of a Notice of
Transaction Pursuant To Section 25102(f) of the California Corporate Securities
Law of 1968.
XXXXXX GODWARD LLP
X.X. Xxxxxx & Co.
February 27, 1998
Page Four
This opinion is intended solely for your benefit and is not to be
made available to or be relied upon by any other person, firm, or entity without
our prior written consent.
Very truly yours,
Xxxxxx Godward LLP
By:
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Xxxxxxxxx X. Xxxx
