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Exhibit 10.25
X.X. XXXXXXXX & CO., INC.
FOUNDED 1960
BROKER & DEALER IN SECURITIES
UNDERWRITERS
XXXXXXX XXXXXX XXXXX
000 XXXXXXXXXX XXXX. * X.X. XXX 000 * XXXXXX XXXX, XX 00000-0000
000-000-0000 * 000-0000000 * FAX 000-000-0000 * xxx.xxxxxxxxxx.xxx
Xx. Xxxxxxxxx X. Xxxxxx, PhD
Chairman & Chief Scientific Officer
Celsion Corporation
00000-X Xxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000-0000
Dear Xx. Xxxxxx:
THIS AGREEMENT (the "AGREEMENT") is made as of January 17, 2001 between
Celsion Corporation ("CELSION") and X.X. Xxxxxxxx & Co., Inc. ("XXXXXXXX").
In consideration of the mutual covenants contained herein and intending to
be legally bound thereby, CELSION and XXXXXXXX hereby agree as follows.
1. XXXXXXXX will perform investment banking services, on a non-exclusive
basis, for CELSION on the terms set forth below for a period of five
years from the date hereof or such shorter period as this AGREEMENT
shall remain in effect (the "TERM"). Such services will be performed
on a best efforts basis and will include, without limitation,
assistance to CELSION in mergers, acquisitions, and internal capital
structuring and the placement of new debt and equity issues of CELSION
all with the objective of accomplishing CELSION's business and
financial goals. In each instance, XXXXXXXX shall endeavor, subject to
market conditions, to assist CELSION in identifying corporate
candidates for mergers and acquisitions and sources of private and
institutional funds; to provide planning, structuring, strategic and
other advisory services to CELSION; and to assist in negotiations on
behalf of CELSION. `11MEYERSON will have the option to perform all
financings to be done by CELSION for as long as this AGREEMENT is in
effect; provided, however, that in the event that, within a period of
five (5) business days following the initial proposal of any such
financing, during which time the parties shall negotiate in good faith
to arrive at mutually acceptable terms under which XXXXXXXX will
perform such financing, XXXXXXXX and CELSION are unable to agree to
such mutually acceptable terms, XXXXXXXX'x right of first refusal for
the proposed financing shall expire and be of no further force and
effect and CELSION thereafter shall be permitted to engage others to
perform such financing. In each instance, XXXXXXXX will render such
services as to which CELSION and XXXXXXXX mutually agree and XXXXXXXX
will exert its best efforts to accomplish the goals agreed to by
XXXXXXXX and CELSION.
2. In connection with the performance of this AGREEMENT, XXXXXXXX and
CELSION shall comply with all applicable laws and regulations,
including, without limitation, those of the National Association of
Securities Dealers, Inc. and the Securities and Exchange Commission.
3. In consideration of the services previously rendered and to be
rendered by XXXXXXXX hereunder, XXXXXXXX is hereby granted five-year
XXXXXXXX Warrants to purchase, at a price of $1.75 per share, a total
of 300,000 shares of common stock of CELSION, with registration rights
as set forth in paragraph 4 below The XXXXXXXX Warrants shall also
entitle XXXXXXXX to receive one additional Warrant to purchase one
additional share of common stock at $5.00 per share for every two
original XXXXXXXX Warrants exercised at $1.75. In any event, the
XXXXXXXX Warrants
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shall vest and become irrevocable immediately upon the signing of this
AGREEMENT and expire five years thereafter. XXXXXXXX shall have, at
XXXXXXXX'x discretion, both a cashless exercise option to exercise the
Warrants and rights of registration as described in paragraph 4 below.
If the cashless exercise option is exercised, it would be accomplished
by surrendering the vested Warrants and replacing them with shares of
CELSION common stock as provided herein. The amount of shares of
common stock of CELSION to be issued and the number of shares
underlying Warrants to be surrendered in payment therefore will be
based on the fair market value per share valued at the average of the
daily closing price for the twenty (20) consecutive trading days
immediately preceding the date of exercise. The presentation of a copy
of this AGREEMENT by XXXXXXXX, together with a request that part or
all of the Warrant be exercised and a direction that the appropriate
number of shares be withheld to pay the exercise price, shall be
deemed to be the surrender of such number of shares for purposes of
exercising the cashless exercise option including the Warrants.
4. (a) Within one hundred eighty (180) calendar days following the
execution of this Agreement, and without any specific request or
demand from XXXXXXXX, CELSION shall use its best efforts to file
a Registration Statement on Form S-3 with the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as
amended (the" ACT") covering the resale, by XXXXXXXX, of the
shares of Celsion common stock underlying all of the XXXXXXXX
Warrants; provided, however, that the failure, by CELSION, to
file such a Registration Statement within such 180-day period
shall not be deemed to be a breach of this AGREEMENT so long as
CELSION continues to use its best efforts to file the
Registration Statement as promptly as practicable thereafter.
CELSION shall use its best efforts to cause such Registration
Statement to be declared effective as promptly as practicable
following the filing thereof and to maintain the effectiveness of
such Registration Statement until the first to occur of (1) the
date when all of the shares underling the Warrants have been sold
pursuant to an effective registration statement or to Rule 144
under the ACT or are subject to sale pursuant to such Rule 14 or
(2) the fifth anniversary of the date of this AGREEMENT.
Additionally, if CELSION during the period from January 17, 2002
to January 17, 2006 files a Registration Statement covering the
sale of any of CELSION's common stock, then CELSION on each such
occasion, at the request of the holders of at least 51% of the
shares and warrants constituting the XXXXXXXX EQUITY, shall
include in any such Registration Statement, at CELSION's expense,
the XXXXXXXX SHARES, provided that, if the sale of securities by
CELSION is being made through an underwriter and the underwriter
objects to inclusion of the XXXXXXXX SHARES in the Registration
Statement, the XXXXXXXX SHARES shall not be so included in the
Registration Statement or in any registration statement filed
within 90 days after thc effective date of the underwritten
Registration Statement.
b. In addition to the exercise format described in paragraph (a)
above, if the underlying shares of CELSION common stock are not
then covered by an effective S-3 or other registration statement,
an additional registration route shall also be available to
XXXXXXXX, at their sole discretion, which shall be as follows:
during the period from January 17, 2002 to January 17, 2006 the
holders of at least 51% of (i) the XXXXXXXX Warrants (without
regard to any Warrants exercisable at $5.00 which may be
issuable, but have not then been issued, upon the exercise of
Warrants exercisable at $1.75) not then exercised; and (ii) the
shares previously issued upon exercise of any of the XXXXXXXX
Warrants (including any Warrants exercised at $5.00)
(hereinafter, collectively, the "XXXXXXXX EQUITY",) excluding any
shares theretofore sold pursuant to an effective registration
statement or to Rule 144 under the ACT or which are subject to
sale pursuant to such Rule 144, may demand, on one occasion only,
that CELSION at CELSION's expense (except that XXXXXXXX shall
bear the cost of its counsel and of any brokers' commission or
discounts and similar items in connection with such public
offering), promptly file a Registration Statement under the ACT
to permit a public resale offering of the shares issued and
issuable pursuant to exercise of the XXXXXXXX Warrants (the
"XXXXXXXX SHARES") and which are not subject to sale pursuant to
Rule !44 under the ACT.
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5. In the event of a "change in control of CELSION," as defined below, in
which CELSION fails to honor the exercise by XXXXXXXX of any vested
Warrants as set forth herein, by failing to deliver the
certificates(s) for the underlying shares of common stock to XXXXXXXX
within 15 business days after such exercise, then XXXXXXXX may take
legal action, without further notice to CELSION to obtain such
underlying shares, and CELSION agrees to pay all damages, costs and
expenses incurred by XXXXXXXX, including reasonable attorneys' fees.
In addition to any other damages sustained by XXXXXXXX as a result of
CELSION's failure to honor such exercise, including any diminution in
the value of the underlying shares over time. CELSION agrees that it
will pay XXXXXXXX interest, at the weighted average prime rate
published by the Chase Bank for the six month period ending on the
exercise date, on the market value of the underlying shares as of the
15th business day after the exercise, for the period beginning on the
15th business day after the exercise and ending on the day the
certificates for the underlying shares are received by XXXXXXXX.
For purposes of this AGREEMENT, a "change in control of CELSION" shall be
deemed to have occurred if:
(A) any "person" (as such term is used in Sections (13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT")), other than a trustee or other fiduciary holding
securities under an employee benefit plan of CELSION or a
corporation owned, directly or indirectly, by the stockholders of
CELSION in substantially the same proportions as their ownership
of stock of CELSION, is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the EXCHANGE ACT), directly or
indirectly, of securities of CELSION representing more than 50%
of the combined voting power of CELSION's then outstanding
securities;
(B) during any period of two (2) consecutive years (not including any
period prior to the execution of this AGREEMENT), individuals
who, at the beginning of such period, constitute the Board of
Directors and any new director whose election by the Board or
nomination for election by CELSION's stockholders or whose
selection to fill a vacancy on the Board of Directors, no matter
how created, was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination
for election was previously so approved, cease for any reason to
constitute a majority thereof;
(C) a merger or consolidation of CELSION, approved by the
stockholders of CELSION, with any other corporation, other than a
merger or consolidation which would result in the voting
securities of CELSION outstanding immediately prior thereto
continuing to represent ( either by remaining outstanding or by
being converted into voting securities of the surviving entity)
at least 50% of the combined voting power of the voting
securities of CELSION or such surviving entity outstanding
immediately after such merger or consolidation; or
(D) a complete liquidation of CELSION or a sale or disposition by
CELSION of all or substantially all of CELSION's assets, in
either case subject to a plan or agreement approved by the
stockholders of CELSION.
6. If CELSION should, at any time, or from time to time while the
warrants remain exercisable, effect a stock split or a reverse stock
split, the terms of the XXXXXXXX Warrants shall be proportionately
adjusted to prevent the dilution or enlargement of the rights of the
XXXXXXXX interest.
7. The obligation of CELSION to register the resale of the XXXXXXXX
shares, including the shares issuable upon exercise of the XXXXXXXX
Warrants, pursuant to the demand or the piggy back registration rights
set forth in paragraph 4 above, shall be without regard to whether the
XXXXXXXX Warrants have been or will be exercised.
8. CELSION agrees that, for a period of three (3) years from the date of
this AGREEMENT, CELSION will not utilize the registration exemption
set forth in Regulation S under the ACT, nor issue any
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security with a downward ratchet dilution program without the consent
of XXXXXXXX, which consent will not be unreasonably withheld.
9. This AGREEMENT constitutes the entire Warrant Agreement between the
parties and when a copy hereof is presented to CELSION's transfer
agent, together with a request that all or part of the XXXXXXXX
Warrant be exercised and a certified check in the proper amount or a
direction, pursuant to the cashless exercise option, that shares be
withheld to pay for the exercise, subject to confirmation of the
calculation of the number of shares to be withheld, the certificates
for the appropriate number of shares of Common Stock shall be promptly
issued.
10. Upon the execution of this AGREEMENT, CELSION shall include in its
next annual report the highlights and terms of this investment banking
AGREEMENT.
11. Upon the signing of this AGREEMENT, CELSION shall pay XXXXXXXX $25,000
as a nonaccountable and non-refundable expense allowance for due
diligence and general compliance review. XXXXXXXX shall be entitled to
additional compensation, to be negotiated between XXXXXXXX and CELSION
arising out of any transactions that are proposed or executed by
XXXXXXXX and consummated by CELSION or are executed by XXXXXXXX at
CELSION's request, during the term of this AGREEMENT to the extent
that such compensation is normal and ordinary for such transactions.
In addition, XXXXXXXX shall be reimbursed by CELSION for any
reasonable out-of-pocket expenses that XXXXXXXX may incur in
connection with rendering any service to or on behalf of CELSION that
is approved, in writing, in advance by CELSION's Chief Executive
Officer.
12. CELSION agrees to indemnify and hold XXXXXXXX and its directors,
officers and employees harmless from and against any and all losses,
claims, damages, liabilities, costs or expenses arising out of any
action or cause of action brought against XXXXXXXX in connection with
its rendering services under this AGREEMENT except for any losses,
claims, damages, liabilities, costs or expenses resulting from any
violation by XXXXXXXX of applicable laws and regulations including,
without limitation, those of the National Association of Securities
Dealers, Inc. and the Securities and Exchange Commission or any state
securities commission or from any act of XXXXXXXX involving willful
misconduct and except that CELSION shall not be liable for any amount
paid in settlement of any claim that is settled without its prior
written consent.
13. XXXXXXXX agrees to indemnify and hold CELSION and its directors,
officers and employees harmless from and against any and all losses
claims, damages, liabilities, costs or expenses resulting from any
violation by XXXXXXXX of applicable laws and regulations including,
without limitation, those of the National Association of Securities
Dealers, Inc, the Securities and Exchange Commission or any state
securities commission or from any act of XXXXXXXX involving willful
misconduct.
14. CELSION will submit to XXXXXXXX a current business plan setting forth
how CELSION plans to proceed as soon as possible following the
execution of this AGREEMENT.
15. Nothing contained in this AGREEMENT shall be construed to constitute
XXXXXXXX as a partner, employee, or agent of CELSION; nor shall either
party have any authority to bind the other in any respect, it being
intended that XXXXXXXX is, and shall remain an independent contractor.
16. This AGREEMENT may not be assigned by either party hereto.
Notwithstanding the foregoing, XXXXXXXX may assign any or all of its
Warrants to its employees provided that, prior to any such assignment,
and as a condition precedent thereto, XXXXXXXX shall provide to
CELSION an opinion of counsel reasonably acceptable to CELSION, which
opinion shall be in form and substance reasonable acceptable to
CELSION, to the effect that such assignment conforms to the
registration requirements of the Securities Act and any applicable
state securities or "blue sky" laws or is being made pursuant to valid
exemption therefrom.
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17. This AGREEMENT shall be interpreted in accordance with the laws of the
State of New Jersey applicable to agreements negotiated, entered into
and performed wholly within the State of New Jersey and shall be
binding upon the successors of the parties.
18. This AGREEMENT may be terminated by either party at any time by
providing written notice thereof to the other party; provided,
however, that legally vested XXXXXXXX Warrants shall remain with
XXXXXXXX.
19. If any paragraph, sentence, clause or phrase of this AGREEMENT is for
any reason declared to be illegal, invalid, unconstitutional, void or
unenforceable, all other paragraphs, sentences, clauses or phrases
hereof not so held shall be and remain in full force and effect.
20. None of the terms of this AGREEMENT shall be deemed to be waived or
modified except by an express agreement in writing signed by the party
against whom enforcement of such waiver or modification is sought. The
failure of either party at any time to require performance by the
other party of any provision hereof shall, in no way, affect the full
right to require such performance at any time thereafter. Nor shall
the waiver by either party of a breach of any provision hereof be
taken or held to be a waiver of any succeeding breach of such
provision or as a waiver of the provision itself.
21. Any dispute, claim or controversy arising out of or relating to this
AGREEMENT, or the breach thereof, shall be settled by arbitration in
Jersey City, New Jersey, in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. The parties hereto
agree that they will abide by and perform any award rendered by the
arbitrator(s) and that judgment upon any such award may be entered in
any Court, state or federal, having jurisdiction over the party
against whom the judgment is being entered. Any arbitration demand,
summons, complaint, other process, notice of motion, or other
application to an arbitration panel, Court or Judge, and any
arbitration award or judgment may be served upon any party hereto by
registered or certified mail, or by personal service, provided a
reasonable time for appearance or answer is allowed.
22. For purposes of compliance with laws pertaining to potential inside
information being distributed unauthorized to anyone, all
communications regarding CELSION should only be directed to Xxxxxx X.
Xxxxxxxx, Chairman, Xxxxxx X. Xxxxxxxxxx, Senior Vice President, Chief
Operating Officer, or Xxxxxx Meson, Vice President, Compliance. If
information is being faxed, our confidential compliance fax number is
(000) 000-0000 for communication use.
23. Contemporaneously with the execution hereof, XXXXXXXX shall enter into
a confidentiality agreement with CELSION on such terms as CELSION
shall reasonably require. In addition, by entering into this
AGREEMENT, XXXXXXXX agrees to be bound by the terms of CELSION's
"Policy Statement on Non-public Information and Trading in Company
Securities by Officers, Directors and Employees" as if explicitly
covered by the terms thereof.
24. All notices required or permitted hereunder shall be in writing and
shall be deemed effectively given (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile
if sent during normal business hours of the party being notified or,
if sent outside of normal business hours, on the next business day;
(iii) five (5) calendar days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (iv) one
(1) calendar day (excluding Sundays or other days on which no delivery
is available) after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification of
receipt. All communications shall be sent to the party to be notified
at the address as set forth below or at such other address as such
party may designate by ten (10) calendar days advance written notice
to the other party hereto.
IF TO CELSION:
Celsion Corporation
00000-X Xxx Xxxxxxxx Xxxx
0
0
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
Facsimile: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxxxxxxx, Esquire
Venable, Baetjer, Xxxxxx & Civiletti, LLP
0000 Xxx Xxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
IF TO XXXXXXXX:
X.X. Xxxxxxxx & Co., Inc.
Newport Office Tower
000 Xxxxxxxxxx Xxxxxxxxx
Xxxx Xxxxxx Xxx 000
Xxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
25. IN WITNESS WHEREOF, the parties hereto have executed this AGREEMENT as
of the day and year set forth above.
X.X. Xxxxxxxx & Co., Inc. Celsion Corporation
By: /s/ Xxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxxxxx X. Xxxxxx
---------------------------------------------- -----------------------------------
Xxxxxx X. Xxxxxxxxxx Xxxxxxxxx X. Xxxxxx, PhD
Senior Vice President, Chief Operating Officer Chairman & Chief Scientific Officer
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