EXHIBIT 4.1
STOCK PURCHASE AGREEMENT
Neurocrine Biosciences, Inc.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Ladies & Gentlemen:
The undersigned, _________________________________(the "Investor"),
hereby confirms its agreement with you as follows:
1. This Stock Purchase Agreement (the "Agreement") is made as of December 20,
1999 between Neurocrine Biosciences, Inc., a Delaware corporation (the
"Company"), and the Investor.
2. The Company has authorized the sale and issuance of up to 3,000,000 shares
(the "Shares") of common stock of the Company, $0.001 par value per share (the
"Common Stock"), subject to adjustment by the Company's Board of Directors, to
certain investors in a private placement (the "Offering").
3. The Company and the Investor agree that the Investor will purchase from the
Company and the Company will issue and sell to the Investor ___________ Shares,
for a purchase price of $18.00 per share, or an aggregate purchase price of
$_______________, pursuant to the Terms and Conditions for Purchase of Shares
attached hereto as Annex I and incorporated herein by reference as if fully set
forth herein. Unless otherwise requested by the Investor, certificates
representing the Shares purchased by the Investor will be registered in the
Investor's name and address as set forth below.
4. The Investor represents that, except as set forth below, (a) it has had no
position, office or other material relationship within the past three years with
the Company or its affiliates, (b) neither it, nor any group of which it is a
member or to which it is related, beneficially owns (including the right to
acquire or vote) any securities of the Company and (c) it has no direct or
indirect affiliation or association with any NASD member.
Exceptions:
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(if no exceptions, write "none." If left blank,
response will be deemed to be "none.")
Please confirm that the foregoing correctly sets forth the agreement
between us by signing in the space provided below for that purpose.
AGREED AND ACCEPTED:
NEUROCRINE BIOSCIENCES, INC.
By: /s/ Xxxx X. Xxxxxx
Title: Senior Vice President and CFO
Page II-6
INVESTOR SIGNATURE PAGE
BIOTECH TARGET S.A.
By: /s/ A. Hove and /s/XX Xxxx
Title Signing Authorities
Address: Swiss Xxxx Xxxxx, Xxxxxx 0, Xxxxxxxx xx Xxxxxx
Date: December 22, 1999
Purchase: 500,000 shares for $9,000,000
DEUTSCHE VERMOGENSBILDUNGSGESELLSCHAFT MBH
By: /s/ Xxxxxx Eudonhat
Title Fund Manager
Address: Xxxxxxxxxxxxxx 00, 00000 Xxxxxxxxx, Xxxxxxx
Date: December 21, 1999
Purchase: 600,000 shares for $10,800,000
DEUTSCHE ASSET MANGEMENT INVESTMENTGESELLSCHAFT MBH
By: /s/
Title Fund Manager
Address: Xxxxxxx Xxxxxxxx(xxxx)x 00, 00000 Xxxxxxxxx, Xxxxxxx
Date: December 20, 1999
Purchase: 300,000 shares for $5,400,000
SEB LAKEMEDELSFUND
By: /s/ Xxxxxxx XX Xxxxxxxxxx
Title Head of SEB Investment Management
Address: XX 00, 00000, Xxxxxxxxx, Xxxxxxx
Date: December 20, 1999
Purchase: 385,000 shares for $6,930,000
SEB PRIVATE BANK S.A., LUXMEBORG
By: /s/ X. Xxxxxxx
Title Senior Manager
Address: 00, Xxxxxxxxx Xxxxx XX Xxx 000, X-0000 Xxxxxxxxxx
Date: December 23, 1999
Purchase: 65,000 shares for $1,170,000
ACTIVEST MANAGEMENT SA
By: /s/ X. Xxxxxxxxxxx and /s/ X. Xxxxxx
Title Managing Director Executive Director
Address: 00, Xxx Xxxxx, Xxxxxx, Xxxxxxxxxx 0000
Date: December 22, 1999
Purchase: 277,777 shares for $4,999,986
DWS INVESTMENT GMB
By: /s/ Xxxxxxx Xxxxxxxxx
Title Senior Fund Manager
Address: Gruneburgweg 000-000, Xxxxxxxxx Xx Xxxx 00000, Xxxxxxx
Date: December 22, 1999
Purchase: 200,000 shares for $3,600,000
Page II-7
ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF SHARES
1. Authorization and Sale of the Shares. Subject to the terms and
conditions of this Agreement, the Company has authorized the sale of up to
3,000,000 Shares. The Company reserves the right to increase or decrease this
number.
2. Agreement to Sell and Purchase the Shares; Subscription Date.
2.1 At the Closing (as defined in Section 3), the Company will
sell to the Investor, and the Investor will purchase from the Company, upon the
terms and conditions hereinafter set forth, the number of Shares set forth on
the signature page hereto at the purchase price set forth on such signature
page.
2.2 The Company may enter into this same form of Stock
Purchase Agreement with certain other investors (the "Other Investors") and
expects to complete sales of Shares to them. (The Investor and the Other
Investors are hereinafter sometimes collectively referred to as the "Investors,"
and this Agreement and the Stock Purchase Agreements executed by the Other
Investors are hereinafter sometimes collectively referred to as the
"Agreements.") The Company will accept executed Agreements from Investors for
the purchase of Shares commencing upon the date on which the Company provides
the Investors with the proposed purchase price per Share and concluding upon the
date (the "Subscription Date") on which the Company has (i) executed Agreements
with Investors for the purchase of at least 2,327,777 Shares, and (ii) notified
the Investors in writing that it is no longer accepting Agreements from
Investors for the purchase of Shares. The Company may not enter into any
Agreements after the Subscription Date.
3. Delivery of the Shares at Closing. The completion of the purchase
and sale of the Shares (the "Closing") shall occur (the "Closing Date") on
December 22, 1999, at the offices of the Company's counsel. At the Closing, the
Company shall deliver to the Investor one or more stock certificates
representing the number of Shares set forth on the signature page hereto, each
such certificate to be registered in the name of the Investor or, if so
indicated on the signature page hereto, in the name of a nominee designated by
the Investor.
The Company's obligation to issue the Shares to the Investor shall be
subject to the following conditions, any one or more of which may be waived by
the Company: (a) receipt by the Company of a certified or official bank check or
wire transfer of funds in the full amount of the purchase price for the Shares
being purchased hereunder as set forth on the signature page hereto; (b)
completion of the purchases and sales under the Agreements with the Other
Investors; and (c) the accuracy of the representations and warranties made by
the Investors and the fulfillment of those undertakings of the Investors to be
fulfilled prior to the Closing.
The Investor's obligation to purchase the Shares shall be subject to
the following conditions, any one or more of which may be waived by the
Investor: (a) Investors shall have executed Agreements for the purchase of at
least 2,327,777 Shares, and (b) the representations and warranties of the
Company set forth herein shall be true and correct in all material respects.
4. Representations, Warranties and Covenants of the Company. The
Company hereby represents and warrants to, and covenants with, the Investor, as
follows:
4.1 Organization. The Company is duly organized and validly
existing in good standing under the laws of the jurisdiction of its
organization. Each of the Company and its Subsidiaries (as defined in Rule 405
under the Securities Act of 1933, as amended (the "Securities Act")) has full
power and authority to own, operate and occupy its properties and to conduct its
business as presently conducted and as described in the confidential offering
memorandum, dated December 17, 1999 distributed in connection with the sale of
the Shares (including the documents incorporated by reference therein, the
"Placement Memorandum") and is registered or qualified to do business and in
good standing in each jurisdiction in which it owns or leases property or
transacts business and where the failure to be so qualified would have a
material adverse effect upon the business, financial condition, properties or
operations of the Company and its Subsidiaries, considered as one enterprise,
and no proceeding has been instituted in any such jurisdiction, revoking,
limiting or curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification.
Page II-8
4.2 Due Authorization. The Company has all requisite power and
authority to execute, deliver and perform its obligations under the Agreements,
and the Agreements have been duly authorized and validly executed and delivered
by the Company and constitute legal, valid and binding agreements of the Company
enforceable against the Company in accordance with their terms, except as rights
to indemnity and contribution may be limited by state or federal securities laws
or the public policy underlying such laws, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
4.3 Non-Contravention. The execution and delivery of the
Agreements, the issuance and sale of the Shares to be sold by the Company under
the Agreements, the fulfillment of the terms of the Agreements and the
consummation of the transactions contemplated thereby will not (A) conflict with
or constitute a violation of, or default (with the passage of time or otherwise)
under, (i) any material bond, debenture, note or other evidence of indebtedness,
or under any material lease, contract, indenture, mortgage, deed of trust, loan
agreement, joint venture or other agreement or instrument to which the Company
or any Subsidiary is a party or by which it or any of its Subsidiaries or their
respective properties are bound, (ii) the charter, by-laws or other
organizational documents of the Company or any Subsidiary, or (iii) any law,
administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority applicable to the Company or any
Subsidiary or their respective properties, or (B) result in the creation or
imposition of any lien, encumbrance, claim, security interest or restriction
whatsoever upon any of the material properties or assets of the Company or any
Subsidiary or an acceleration of indebtedness pursuant to any obligation,
agreement or condition contained in any material bond, debenture, note or any
other evidence of indebtedness or any material indenture, mortgage, deed of
trust or any other agreement or instrument to which the Company or any
Subsidiary is a party or by which any of them is bound or to which any of the
property or assets of the Company or any Subsidiary is subject. No consent,
approval, authorization or other order of, or registration, qualification or
filing with, any regulatory body, administrative agency, or other governmental
body in the United States is required for the execution and delivery of the
Agreements and the valid issuance and sale of the Shares to be sold pursuant to
the Agreements, other than such as have been made or obtained, and except for
any securities filings required to be made under federal or state securities
laws.
4.4 Capitalization. The capitalization of the Company as of
September 30, 1999 is as set forth in the Placement Memorandum (excluding
unvested options and treasury shares). The Company has not issued any capital
stock since that date other than pursuant to (i) employee benefit plans
disclosed in the Placement Memorandum, or (ii) outstanding warrants or options
disclosed in the Placement Memorandum. The Shares to be sold pursuant to the
Agreements have been duly authorized, and when issued and paid for in accordance
with the terms of the Agreements will be duly and validly issued, fully paid and
nonassessable. The outstanding shares of capital stock of the Company have been
duly and validly issued and are fully paid and nonassessable, have been issued
in compliance with all federal and state securities laws, and were not issued in
violation of any preemptive rights or similar rights to subscribe for or
purchase securities. Except as set forth in or contemplated by the Placement
Memorandum, there are no outstanding rights (including, without limitation,
preemptive rights), warrants or options to acquire, or instruments convertible
into or exchangeable for, any unissued shares of capital stock or other equity
interest in the Company or any Subsidiary, or any contract, commitment,
agreement, understanding or arrangement of any kind to which the Company is a
party or of which the Company has knowledge and relating to the issuance or sale
of any capital stock of the Company or any Subsidiary, any such convertible or
exchangeable securities or any such rights, warrants or options. Without
limiting the foregoing, no preemptive right, co-sale right, right of first
refusal, registration right, or other similar right exists with respect to the
Shares or the issuance and sale thereof. No further approval or authorization of
any stockholder, the Board of Directors of the Company or others is required for
the issuance and sale of the Shares. The Company owns the entire equity interest
in each of its Subsidiaries, free and clear of any pledge, lien, security
interest, encumbrance, claim or equitable interest, other than as described in
the Placement Memorandum. Except as disclosed in the Placement Memorandum, there
are no stockholders agreements, voting agreements or other similar agreements
with respect to the Common Stock to which the Company is a party or, to the
knowledge of the Company, between or among any of the Company's stockholders.
4.5 Legal Proceedings. There is no material legal or
governmental proceeding pending or, to the knowledge of the Company, threatened
to which the Company or any Subsidiary is or may be a party or of which the
business or property of the Company or any Subsidiary is subject that is not
disclosed in the Placement Memorandum.
Page II-9
4.6 No Violations. Neither the Company nor any Subsidiary is
in violation of its charter, bylaws, or other organizational document, or in
violation of any law, administrative regulation, ordinance or order of any court
or governmental agency, arbitration panel or authority applicable to the Company
or any Subsidiary, which violation, individually or in the aggregate, would be
reasonably likely to have a material adverse effect on the business or financial
condition of the Company and its Subsidiaries, considered as one enterprise, or
is in default (and there exists no condition which, with the passage of time or
otherwise, would constitute a default) in any material respect in the
performance of any bond, debenture, note or any other evidence of indebtedness
in any indenture, mortgage, deed of trust or any other material agreement or
instrument to which the Company or any Subsidiary is a party or by which the
Company or any Subsidiary is bound or by which the properties of the Company or
any Subsidiary are bound, which would be reasonably likely to have a material
adverse effect upon the business or financial condition of the Company and its
Subsidiaries, considered as one enterprise.
4.7 Governmental Permits, Etc. With the exception of the
matters which are dealt with separately in Section 4.1, 4.12, 4.13, and 4.14,
each of the Company and its Subsidiaries has all necessary franchises, licenses,
certificates and other authorizations from any foreign, federal, state or local
government or governmental agency, department, or body that are currently
necessary for the operation of the business of the Company and its Subsidiaries
as currently conducted and as described in the Placement Memorandum except where
the failure to currently possess could not reasonably be expected to have a
material adverse effect.
4.8 Intellectual Property. Subject to the matters discussed
under "Risk Factors" in the Placement Memorandum (i) each of the Company and its
Subsidiaries owns or possesses sufficient rights to use all material patents,
patent rights, trademarks, copyrights, licenses, inventions, trade secrets,
trade names and know-how (collectively, "Intellectual Property") described or
referred to in the Placement Memorandum as owned by it or that are necessary for
the conduct of its business as now conducted or as proposed to be conducted as
described in the Placement Memorandum except where the failure to currently own
or possess would not have a material adverse effect on the condition (financial
or otherwise), earnings, operations, business or business prospects of the
Company and its Subsidiaries considered as one enterprise, (ii) neither the
Company nor any of its Subsidiaries has received any notice of, or has any
knowledge of, any infringement of asserted rights of a third party with respect
to any Intellectual Property that, individually or in the aggregate, would have
a material adverse effect on the financial condition or business of the Company
and its Subsidiaries considered as one enterprise and (iii) neither the Company
nor any of its Subsidiaries has received any notice of any infringement of
rights of a third party with respect to any Intellectual Property that,
individually or in the aggregate, would have a material adverse effect upon the
business or financial condition of the Company and its Subsidiaries, considered
as one enterprise.
4.9 Financial Statements. The financial statements of the
Company and the related notes contained in the Placement Memorandum present
fairly, in accordance with generally accepted accounting principles, the
financial position of the Company and its Subsidiaries as of the dates
indicated, and the results of its operations and cash flows for the periods
therein specified. Such financial statements (including the related notes) have
been prepared in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods therein specified, except
as disclosed in the Placement Memorandum. The other financial information
contained in the Placement Memorandum has been prepared on a basis consistent
with the financial statements of the Company.
4.10 No Material Adverse Change. Except as disclosed in the
Placement Memorandum, since September 30, 1999, there has not been (i) any
material adverse change in the financial condition or earnings of the Company
and its Subsidiaries considered as one enterprise nor has any material adverse
event occurred to the Company or its Subsidiaries, (ii) any material adverse
event affecting the Company, (iii) any obligation, direct or contingent, that is
material to the Company and its Subsidiaries considered as one enterprise,
incurred by the Company, except obligations incurred in the ordinary course of
business, (iv) any dividend or distribution of any kind declared, paid or made
on the capital stock of the Company or any of its Subsidiaries, or (v) any loss
or damage (whether or not insured) to the physical property of the Company or
any of its Subsidiaries which has been sustained which has a material adverse
effect on the condition (financial or otherwise), earnings, operations, business
or business prospects of the Company and its Subsidiaries considered as one
enterprise.
4.11 Disclosure. The information contained in the Placement
Memorandum as of the date hereof and as of the Closing Date, did not and shall
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
Page II-10
4.12 NASDAQ Compliance. The Company's Common Stock is
registered pursuant to Section 12(g) of the Exchange Act and is listed on The
Nasdaq Stock Market, Inc. National Market (the "Nasdaq National Market"), and
the Company has taken no action designed to, or likely to have the effect of,
terminating the registration of the Common Stock under the Exchange Act or
de-listing the Common Stock from the Nasdaq National Market, nor has the Company
received any notification that the Securities and Exchange Commission (the
"SEC") or the National Association of Securities Dealers, Inc. ("NASD") is
contemplating terminating such registration or listing.
4.13 Reporting Status. The Company has filed in a timely
manner all documents that the Company was required to file under the Securities
Exchange Act of 1934, as amended (the "Exchange Act") during the 12 months
preceding the date of this Agreement. The following documents complied in all
material respects with the SEC's requirements as of their respective filing
dates, and the information contained therein as of the date thereof did not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein in
light of the circumstances under where they were made not misleading:
(a) The Company's Annual Report on Form 10-K for
the year ended December 31, 1998 (the "10-K"); and
(b) All other documents, if any, filed by the
Company with the SEC since December 31, 1998
pursuant to the reporting requirements of the
Exchange Act.
4.14 Listing. The Company shall comply with all requirements
of the National Association of Securities Dealers, Inc. with respect to the
issuance of the Shares and the listing thereof on the Nasdaq National Market.
4.15 Year 2000 Compliance. The information set forth in the
Placement Memorandum with respect to the Company's efforts regarding Year 2000
matters (i) conforms in all material respects to the guidelines set forth in SEC
Release No. 33-7558 and (ii) accurately describes the status of the Company's
efforts regarding Year 2000 matters. To the Company's knowledge, the costs
associated with ensuring that the Company is Year 2000 compliant will not a
material adverse effect on the operations or business of the Company and its
Subsidiaries considered as one enterprise.
4.16 No Manipulation of Stock. The Company has not taken and
will not, in violation of applicable law, take, any action designed to or that
might reasonably be expected to cause or result in stabilization or manipulation
of the price of the Common Stock to facilitate the sale or resale of the Shares.
5. Representations, Warranties and Covenants of the Investor.
5.1 The Investor represents and warrants to, and covenants
with, the Company that: (i) the Investor is an "accredited investor" as defined
in Regulation D under the Securities Act and the Investor is also knowledgeable,
sophisticated and experienced in making, and is qualified to make decisions with
respect to investments in shares presenting an investment decision like that
involved in the purchase of the Shares, including investments in securities
issued by the Company and investments in comparable companies, and has
requested, received, reviewed and considered all information it deemed relevant
in making an informed decision to purchase the Shares; (ii) the Investor is
acquiring the number of Shares set forth on the signature page hereto in the
ordinary course of its business and for its own account for investment only and
with no present intention of distributing any of such Shares or any arrangement
or understanding with any other persons regarding the distribution of such
Shares; (iii) the Investor will not, directly or indirectly, offer, sell,
pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase
or otherwise acquire or take a pledge of) any of the Shares except in compliance
with the Securities Act, applicable state securities laws and the respective
rules and regulations promulgated thereunder; (iv) the Investor has answered all
questions on the signature page hereto for use in preparation of the
Registration Statement and the answers thereto are true and correct as of the
date hereof and will be true and correct as of the Closing Date; (v) the
Investor will notify the Company immediately of any change in any of such
information until such time as the Investor has sold all of its Shares or until
the Company is no longer required to keep the Registration Statement effective;
and (vi) the Investor has, in connection with its decision to purchase the
number of Shares set forth on the signature page hereto, relied only upon the
Placement Memorandum and the representations and warranties of the Company
contained herein. Investor understands that its acquisition of the Shares has
not been registered under the Securities Act or registered or qualified under
any state securities law in reliance on specific exemptions therefrom, which
exemptions may depend upon, among other things, the bona fide nature of the
Investor's investment intent as expressed herein. Investor has completed or
caused to be completed and delivered to the Company the Investor Questionnaire
attached as Exhibit B to the Placement Memorandum, which questionnaire is true
and correct in all material respects.
Page II-11
5.2 The Investor acknowledges, represents and agrees that no
action has been or will be taken in any jurisdiction outside the United States
by the Company that would permit an offering of the Shares, or possession or
distribution of offering materials in connection with the issue of the Shares,
in any jurisdiction outside the United States where action for that purpose is
required. Each Investor outside the United States will comply with all
applicable laws and regulations in each foreign jurisdiction in which it
purchases, offers, sells or delivers Shares or has in its possession or
distributes any offering material, in all cases at its own expense.
5.3 The Investor hereby covenants with the Company not to make
any sale of the Shares without complying with the provisions of this Agreement,
including Section 7.2 hereof, and without effectively causing the prospectus
delivery requirement under the Securities Act to be satisfied, and the Investor
acknowledges that the certificates evidencing the Shares will be imprinted with
a legend that prohibits their transfer except in accordance therewith. The
Investor acknowledges that there may occasionally be times when the Company
determines that it must suspend the use of the Prospectus forming a part of the
Registration Statement, as set forth in Section 7.2(c).
5.4 The Investor further represents and warrants to, and
covenants with, the Company that (i) the Investor has full right, power,
authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement, and (ii) this
Agreement constitutes a valid and binding obligation of the Investor enforceable
against the Investor in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the indemnification agreements of the Investors
herein may be legally unenforceable.
5.5 Investor will not use any of the restricted Shares
acquired pursuant to this Agreement to cover any short position in the Common
Stock of the Company if doing so would be in violation of applicable securities
laws.
5.6 The Investor understands that nothing in the Placement
Memorandum, this Agreement or any other materials presented to the Investor in
connection with the purchase and sale of the Shares constitutes legal, tax or
investment advice. The Investor has consulted such legal, tax and investment
advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Shares.
6. Survival of Representations, Warranties and Agreements.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Shares being purchased and the payment therefor.
7. Registration of the Shares; Compliance with the Securities Act.
7.1 Registration Procedures and Expenses. The Company shall:
(a) subject to receipt of necessary information from the
Investors, use its reasonable efforts to prepare and file
with the SEC, within 10 days after the Closing Date, a
registration statement (the "Registration Statement") to
enable the resale of the Shares by the Investors from time
to time through the automated quotation system of the Nasdaq
National Market or in privately-negotiated transactions;
(b) use its reasonable efforts, subject to receipt of necessary
information from the Investors, to cause the Registration
Statement to become effective within 90 days after the
Registration Statement is filed by the Company;
(c) use its reasonable efforts to prepare and file with the SEC
such amendments and supplements to the Registration
Statement and the Prospectus used in connection therewith as
may be necessary to keep the Registration Statement current
and effective for a period not exceeding, with respect to
each Investor's Shares purchased hereunder, the earlier of
(i) the second anniversary of the Closing Date, (ii) the
date on which the Investor may sell all Shares then held by
the Investor without restriction by the volume limitations
of Rule 144(e) of the Securities Act, or (iii) such time as
all Shares purchased by such Investor in this Offering have
been sold pursuant to a registration statement.
Page II-12
(d) furnish to the Investor with respect to the Shares
registered under the Registration Statement such number of
copies of the Registration Statement, Prospectuses and
Preliminary Prospectuses in conformity with the requirements
of the Securities Act and such other documents as the
Investor may reasonably request, in order to facilitate the
public sale or other disposition of all or any of the Shares
by the Investor, provided, however, that the obligation of
the Company to deliver copies of Prospectuses or Preliminary
Prospectuses to the Investor shall be subject to the receipt
by the Company of reasonable assurances from the Investor
that the Investor will comply with the applicable provisions
of the Securities Act and of such other securities or blue
sky laws as may be applicable in connection with any use of
such Prospectuses or Preliminary Prospectuses;
(e) file documents required of the Company for normal blue sky
clearance in states specified in writing by the Investor,
provided, however, that the Company shall not be required to
qualify to do business or consent to service of process in
any jurisdiction in which it is not now so qualified or has
not so consented;
(f) bear all expenses in connection with the procedures in
paragraph (a) through (e) of this Section 7.1 and the
registration of the Shares pursuant to the Registration
Statement; and
(g) advise the Investors, promptly after it shall receive notice
or obtain knowledge of the issuance of any stop order by the
SEC delaying or suspending the effectiveness of the
Registration Statement or of the initiation or threat of any
proceeding for that purpose; and it will promptly use its
reasonable efforts to prevent the issuance of any stop order
or to obtain its withdrawal at the earliest possible moment
if such stop order should be issued.
The Company understands that the Investor disclaims being an
underwriter, but the Investor being deemed an underwriter by the SEC shall not
relieve the Company of any obligations it has hereunder, provided, however that
if the Company receives notification from the SEC that the Investor is deemed an
underwriter, then the period by which the Company is obligated to submit an
acceleration request to the SEC shall be extended to the earlier of (i) the 90th
day after such SEC notification, or (ii) 120 days after the initial filing of
the Registration Statement with the SEC.
7.2 Transfer of Shares After Registration; Suspension.
(a) The Investor agrees that it will not effect any Disposition
of the Shares or its right to purchase the Shares that would
constitute a sale within the meaning of the Securities Act
except as contemplated in the Registration Statement
referred to in Section 7.1 and as described below, and that
it will promptly notify the Company of any changes in the
information set forth in the Registration Statement
regarding the Investor or its plan of distribution.
(b) Except in the event that paragraph (c) below applies, the
Company shall (i) if deemed necessary by the Company,
prepare and file from time to time with the SEC a
post-effective amendment to the Registration Statement or a
supplement to the related Prospectus or a supplement or
amendment to any document incorporated therein by reference
or file any other required document so that such
Registration Statement will not contain an untrue statement
of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements
therein not misleading, and so that, as thereafter delivered
to purchasers of the Shares being sold thereunder, such
Prospectus will not contain an untrue statement of a
material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading; (ii) provide the Investor copies of
any documents filed pursuant to Section 7.2(b)(i); and (iii)
inform each Investor that the Company has complied with its
obligations in Section 7.2(b)(i) (or that, if the Company
has filed a post-effective amendment to the Registration
Statement which has not yet been declared effective, the
Company will notify the Investor to that effect, will use
its reasonable efforts to secure the effectiveness of such
post-effective amendment as promptly as possible and will
promptly notify the Investor pursuant to Section 7.2(b)(i)
hereof when the amendment has become effective).
(c) Subject to paragraph (d) below, in the event (i) of any
request by the SEC or any other federal or state
governmental authority during the period of effectiveness of
the Registration Statement for amendments or supplements to
a Registration Statement or related Prospectus or for
Page II-13
additional information; (ii) of the issuance by the SEC or
any other federal or state governmental authority of any
stop order suspending the effectiveness of a Registration
Statement or the initiation of any proceedings for that
purpose; (iii) of the receipt by the Company of any
notification with respect to the suspension of the
qualification or exemption from qualification of any of the
Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; or (iv) of
any event or circumstance which, upon the advice of its
counsel, necessitates the making of any changes in the
Registration Statement or Prospectus, or any document
incorporated or deemed to be incorporated therein by
reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a
material fact or any omission to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of
a material fact or any omission to state a material fact
required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; then the Company shall
deliver a certificate in writing to the Investor (the
"Suspension Notice") to the effect of the foregoing and,
upon receipt of such Suspension Notice, the Investor will
refrain from selling any Shares pursuant to the Registration
Statement (a "Suspension") until the Investor's receipt of
copies of a supplemented or amended Prospectus prepared and
filed by the Company, or until it is advised in writing by
the Company that the current Prospectus may be used, and has
received copies of any additional or supplemental filings
that are incorporated or deemed incorporated by reference in
any such Prospectus. In the event of any Suspension, the
Company will use its reasonable efforts to cause the use of
the Prospectus so suspended to be resumed as soon as
reasonably practicable within 20 business days after the
delivery of a Suspension Notice to the Investor. In addition
to and without limiting any other remedies (including,
without limitation, at law or at equity) available to the
Investor, the Investor shall be entitled to specific
performance in the event that the Company fails to comply
with the provisions of this Section 7.2(c).
(d) Notwithstanding the foregoing paragraphs of this Section
7.2, the Investor shall not be prohibited from selling
Shares under the Registration Statement as a result of
Suspensions on more than three occasions of not more than 30
days each in any twelve month period, unless, in the good
faith judgment of the Company's Board of Directors, upon
advice of counsel, the sale of Shares under the Registration
Statement in reliance on this paragraph 7.2(d) would be
reasonably likely to cause a violation of the Securities Act
or the Exchange Act and result in potential liability to the
Company.
(e) Provided that a Suspension is not then in effect the
Investor may sell Shares under the Registration Statement,
provided that it arranges for delivery of a current
Prospectus to the transferee of such Shares. Upon receipt of
a request therefor, the Company has agreed to provide an
adequate number of current Prospectuses to the Investor and
to supply copies to any other parties requiring such
Prospectuses.
(f) In the event of a sale of Shares by the Investor pursuant to
the Registration Statement, the Investor must also deliver
to the Company's transfer agent, with a copy to the Company,
a Certificate of Subsequent Sale substantially in the form
attached hereto as Exhibit A, so that the Shares may be
properly transferred.
7.3 Indemnification. For the purpose of this Section 7.3:
(i) the term "Selling Stockholder" shall include the
Investor and any affiliate of such Investor;
(ii) the term "Registration Statement" shall include any
final Prospectus, exhibit, supplement or amendment
included in or relating to the Registration Statement
referred to in Section 7.1; and
(iii)the term "untrue statement" shall include any untrue
statement or alleged untrue statement, or any omission
or alleged omission to state in the Registration
Statement a material fact required to be stated therein
or necessary to make the statements therein, in the
light of the circumstances under which they were made,
not misleading.
(a) The Company agrees to indemnify and hold harmless each
Selling Stockholder from and against any losses, claims,
damages or liabilities to which such Selling Stockholder may
become subject (under the Securities Act or otherwise)
insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of, or
are based upon (i) any untrue statement of a material fact
contained in the Registration Statement, or (ii) any failure
by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will reimburse such
Selling Stockholder for any reasonable legal or other
expenses reasonably incurred in investigating, defending or
preparing to defend any such action, proceeding or claim, or
preparing to defend any such action, proceeding or claim,
provided, however, that the Company shall not be liable in
Page II-14
any such case to the extent that such loss, claim, damage or
liability arises out of, or is based upon, an untrue
statement made in such Registration Statement in reliance
upon and in conformity with written information furnished to
the Company by or on behalf of such Selling Stockholder
specifically for use in preparation of the Registration
Statement or the failure of such Selling Stockholder to
comply with its covenants and agreements contained in
Section 7.2 hereof respecting sale of the Shares or any
statement or omission in any Prospectus that is corrected in
any subsequent Prospectus that was delivered to the Investor
prior to the pertinent sale or sales by the Investor.
(b) The Investor agrees to indemnify and hold harmless the
Company (and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act, each
officer of the Company who signs the Registration Statement
and each director of the Company) from and against any
losses, claims, damages or liabilities to which the Company
(or any such officer, director or controlling person) may
become subject (under the Securities Act or otherwise),
insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of, or
are based upon, (i) any failure to comply with the covenants
and agreements contained in Section 7.2 hereof respecting
sale of the Shares, or (ii) any untrue statement of a
material fact contained in the Registration Statement if
such untrue statement was made in reliance upon and in
conformity with written information furnished by or on
behalf of the Investor specifically for use in preparation
of the Registration Statement, and the Investor will
reimburse the Company (or such officer, director or
controlling person), as the case may be, for any legal or
other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding
or claim; provided that the Investor's obligation to
indemnify the Company shall be limited to to the net amount
received by the Investor from the sale of the Shares..
(c) Promptly after receipt by any indemnified person of a notice
of a claim or the beginning of any action in respect of
which indemnity is to be sought against an indemnifying
person pursuant to this Section 7.3, such indemnified person
shall notify the indemnifying person in writing of such
claim or of the commencement of such action, but the
omission to so notify the indemnifying party will not
relieve it from any liability which it may have to any
indemnified party under this Section 7.3 (except to the
extent that such omission materially and adversely affects
the indemnifying party's ability to defend such action) or
from any liability otherwise than under this Section 7.3.
Subject to the provisions hereinafter stated, in case any
such action shall be brought against an indemnified person,
the indemnifying person shall be entitled to participate
therein, and, to the extent that it shall elect by written
notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party,
shall be entitled to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified person.
After notice from the indemnifying person to such
indemnified person of its election to assume the defense
thereof, such indemnifying person shall not be liable to
such indemnified person for any legal expenses subsequently
incurred by such indemnified person in connection with the
defense thereof, provided, however, that if there exists or
shall exist a conflict of interest that would make it
inappropriate, in the opinion of counsel to the indemnified
person, for the same counsel to represent both the
indemnified person and such indemnifying person or any
affiliate or associate thereof, the indemnified person shall
be entitled to retain its own counsel at the expense of such
indemnifying person; provided, however, that no indemnifying
person shall be responsible for the fees and expenses of
more than one separate counsel (together with appropriate
local counsel) for all indemnified parties. In no event
shall any indemnifying person be liable in respect of any
amounts paid in settlement of any action unless the
indemnifying person shall have approved the terms of such
settlement; provided that such consent shall not be
unreasonably withheld. No indemnifying person shall, without
the prior written consent of the indemnified person, effect
any settlement of any pending or threatened proceeding in
respect of which any indemnified person is or could have
been a party and indemnification could have been sought
hereunder by such indemnified person, unless such settlement
includes an unconditional release of such indemnified person
from all liability on claims that are the subject matter of
such proceeding.
(d) If the indemnification provided for in this Section 7.3 is
unavailable to or insufficient to hold harmless an
indemnified party under subsection (a) or (b) above in
respect of any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to
therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the Company on
the one hand and the Investors on the other in connection
with the statements or omissions or other matters which
resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault shall be
determined by reference to, among other things, in the case
of an untrue statement, whether the untrue statement relates
to information supplied by the Company on the one hand or an
Investor on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct
or prevent such untrue statement. The Company and the
Investors agree that it would not be just and equitable if
Page II-15
contribution pursuant to this subsection (d) were determined
by pro rata allocation (even if the Investors were treated
as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable
considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d)
shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no
Investor shall be required to contribute any amount in
excess of the amount by which the net amount received by the
Investor from the sale of the Shares to which such loss
relates exceeds the amount of any damages which such
Investor has otherwise been required to pay by reason of
such untrue statement. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent
misrepresentation. The Investors' obligations in this
subsection to contribute are several in proportion to their
sales of Shares to which such loss relates and not joint.
(e) The parties to this Agreement hereby acknowledge that they
are sophisticated business persons who were represented by
counsel during the negotiations regarding the provisions
hereof including, without limitation, the provisions of this
Section 7.3, and are fully informed regarding said
provisions. They further acknowledge that the provisions of
this Section 7.3 fairly allocate the risks in light of the
ability of the parties to investigate the Company and its
business in order to assure that adequate disclosure is made
in the Registration Statement as required by the Act and the
Exchange Act. The parties are advised that federal or state
public policy as interpreted by the courts in certain
jurisdictions may be contrary to certain of the provisions
of this Section 7.3, and the parties hereto hereby expressly
waive and relinquish any right or ability to assert such
public policy as a defense to a claim under this Section 7.3
and further agree not to attempt to assert any such defense.
7.4 Termination of Conditions and Obligations. The conditions
precedent imposed by Section 5 or this Section 7 upon the transferability of the
Shares shall cease and terminate as to any particular number of the Shares when
such Shares shall have been effectively registered under the Securities Act and
sold or otherwise disposed of in accordance with the intended method of
disposition set forth in the Registration Statement covering such Shares or at
such time as an opinion of counsel satisfactory to the Company shall have been
rendered to the effect that such conditions are not necessary in order to comply
with the Securities Act.
7.5 Information Available. So long as the Registration
Statement is effective covering the resale of Shares owned by the Investor, the
Company will furnish to the Investor:
(a) as soon as practicable after it is available, one copy of
(i) its Annual Report to Stockholders (which Annual Report
shall contain financial statements audited in accordance
with generally accepted accounting principles by a national
firm of certified public accountants), (ii) its Annual
Report on Form 10-K and (iii) its Quarterly Reports on Form
10-Q (the foregoing, in each case, excluding exhibits);
(b) upon the request of the Investor, all exhibits excluded by
the parenthetical to subparagraph (a) of this Section 7.5 as
filed with the SEC and all other information that is made
available to shareholders; and
(c) upon the reasonable request of the Investor, an adequate
number of copies of the Prospectuses to supply to any other
party requiring such Prospectuses; and the Company, upon the
reasonable request of the Investor, will meet with the
Investor or a representative thereof at the Company's
headquarters to discuss all information relevant for
disclosure in the Registration Statement covering the Shares
and will otherwise cooperate with any Investor conducting an
investigation for the purpose of reducing or eliminating
such Investor's exposure to liability under the Securities
Act, including the reasonable production of information at
the Company's headquarters; provided, that the Company shall
not be required to disclose any confidential information to
or meet at its headquarters with any Investor until and
unless the Investor shall have entered into a
confidentiality agreement in form and substance reasonably
satisfactory to the Company with the Company with respect
thereto.
8. Notices. All notices, requests, consents and other communications
hereunder shall be in writing, shall be mailed (A) if within domestic United
States by first-class registered or certified airmail, or nationally recognized
overnight express courier, postage prepaid, or by facsimile, or (B) if delivered
from outside the United States, by International Federal Express or facsimile,
and shall be deemed given (i) if delivered by first-class registered or
certified mail domestic, three business days after so mailed, (ii) if delivered
by nationally recognized overnight carrier, one business day after so mailed,
Page II-16
(iii) if delivered by International Federal Express, two business days after so
mailed, (iv) if delivered by facsimile, upon electric confirmation of receipt
and shall be delivered as addressed as follows:
(a) if to the Company, to:
Neurocrine Biosciences, Inc.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Attn: General Counsel
Phone: (000) 000-0000
Telecopy: (000) 000-0000
(b) with a copy to:
Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx, Esq.
Phone: (000) 000-0000
Telecopy: (000) 000-0000
(c) if to the Investor, at its address on the signature
page hereto, or at such other address or addresses as
may have been furnished to the Company in writing.
9. Changes. This Agreement may not be modified or amended except
pursuant to an instrument in writing signed by the Company and the Investor.
10. Headings. The headings of the various sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed to
be part of this Agreement.
11. Severability. In case any provision contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
12. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of California, without giving
effect to the principles of conflicts of law.
13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.
14. Rule 144. The Company covenants that it will file the reports required to
be filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder (or, if the Company is not required to
file such reports, it will, upon the request of any Investor holding Shares
purchased hereunder made after the second anniversary of the Closing Date, make
publicly available such information as necessary to permit sales pursuant to
Rule 144 under the Securities Act), and it will take such further action as any
such Investor may reasonably request, all to the extent required from time to
time to enable such Investor to sell Shares purchased hereunder without
registration under the Securities Act within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or (b) any similar rule or regulation hereafter adopted by
the SEC. Upon the request of any such Investor, the Company will deliver to such
holder a written statement as to whether it has complied with such information
and requirements.
Page II-17
INSTRUCTION SHEET FOR INVESTOR
(to be read in conjunction with the entire Stock Purchase Agreement)
A. Complete the following items in the Stock Purchase Agreement:
1. Provide the information regarding the Investor requested on the
signature page (page 1). The Agreement must be executed by an individual
authorized to bind the Investor.
2. Return the signed Stock Purchase Agreement to:
Neurocrine Biosciences, Inc. Xxxxxxxxx Xxxxxxxx
00000 Xxxxxxx Xxxxxx Xxxxx 000 Xxxxxxxxxx Xxxxxx Xxxxx 0000
Xxx Xxxxx, XX 00000 Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: General Counsel Attn: Xxxxxxx Xxxxxxxxx
Phone: (000) 000-0000 Phone: (000) 000-0000
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
An executed original Stock Purchase Agreement or a telecopy
thereof must be received by 5:00 p.m. California time on a date to be
determined and distributed to the Investor at a later date.
B. Instructions regarding the transfer of funds for the purchase of Shares
will be telecopied to the Investor by the Company at a later date.
C. To resell the Shares after the Registration Statement covering the
Shares is effective:
(i) Provided that a Suspension of the Registration Statement
is not then in effect pursuant to the terms of the Stock Purchase
Agreement, the Investor may sell Shares under the Registration
Statement, provided that it arranges for delivery of a current
Prospectus to the transferee. Upon receipt of a request therefor, the
Company has agreed to provide an adequate number of current
Prospectuses to each investor and to supply copies to any other parties
requiring such Prospectuses.
(ii) The Investor must also deliver to the Company's transfer
agent, with a copy to the Company, a Certificate of Subsequent Sale in
the form attached as Exhibit A to the Stock Purchase Agreement, so that
the Shares may be properly transferred.
Page II-18
