EXHIBIT 10.22
SOMAXON PHARMACEUTICALS, INC.
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT ("AGREEMENT") is made as of April 15,
2004 by and among Somaxon Pharmaceuticals, Inc., a Delaware corporation (the
"COMPANY"), ProCom One, Inc. ("PROCOM") and Xxxxx Xxxx, an individual (the
"PURCHASER").
The parties agree as follows:
1. Issuance of Stock. In partial consideration for the license grant
and other covenants of ProCom under that certain License Agreement dated August
25, 2003 by and between the Company and ProCom (the "LICENSE AGREEMENT"), the
Company hereby agrees to issue to the Purchaser, as the designee of ProCom under
Section 4.7 of the License Agreement, and the Purchaser hereby accepts, an
aggregate of 201,739 shares of the Company's Common Stock (par value $0.0001 per
share) (the "SHARES").
2. Capitalization as of the Qualified Financing. The Company
represents and warrants to the Purchaser that, as of the effective date of the
Qualified Financing (as defined in the License Agreement), the outstanding
capital stock of the Company consisted of 2,300,000 shares of Series A Preferred
Stock and 3,500,000 shares of Common Stock. Accordingly, the Shares issued to
the Purchaser hereunder, together with the shares of Common Stock to be issued
concurrently to the other designee of ProCom under Section 4.7 of the License
Agreement, Xx. Xxxx X. Xxxxx, constitute eight percent (8.0%) of the outstanding
capital stock of the Company as of the Qualified Financing.
3. Right of First Refusal. The Purchaser shall be entitled to become
a party to the Company's Amended and Restated Investor Rights Agreement, dated
as of December 15, 2003 (the "RIGHTS AGREEMENT"), solely for the purpose of the
right of first refusal set forth in Section 4 thereof. Upon the Purchaser's
execution and delivery to the Company of a counterpart signature page to the
Rights Agreement, the Purchaser shall be deemed to be an "Investor" for purposes
of Section 4 of the Rights Agreement and the provisions of Section 4.7.3 of the
License Agreement shall be deemed satisfied in their entirety.
4. Investment Representations. In connection with the purchase of
the Shares, the Purchaser represents to the Company the following:
(a) The Shares to be issued to the Purchaser hereunder will be
acquired for investment for the Purchaser's own account and not with a view to
the public resale or distribution thereof within the meaning of the Securities
Act of 1933, as amended (the "SECURITIES ACT").
(b) The Purchaser has received or has had full access to all
the information the Purchaser considers necessary or appropriate to make an
informed investment decision with respect to the Shares.
(c) The Purchaser understands that an investment in the Shares
involves substantial risk. The Purchaser: (i) has experience as an investor in
securities of companies in the development stage and acknowledges that the
Purchaser is able to fend for itself, can bear the economic risk of the
Purchaser's investment in the Shares and has such knowledge and experience in
financial or business matters that it is capable of evaluating the merits and
risks of its investment in the Shares and protecting its investment; and/or (ii)
has a preexisting business relationship with the Company and/or certain of its
other officers, directors or controlling persons of a nature and duration that
enables the Purchaser to be aware of the character, business acumen and
financial circumstances of such persons.
(d) Purchaser is an accredited investor within the meaning of
Regulation D promulgated under the Securities Act.
(e) The Purchaser understands that the Shares are
characterized as "restricted securities" under the Securities Act, in a
transaction not involving a public offering and that under the Securities Act
and applicable regulations thereunder such securities may be resold without
registration under the Securities Act only in certain limited circumstances. The
Purchaser represents that it is familiar with Rule 144 of the Securities and
Exchange Commission and understands the resale limitations imposed thereby and
by the Securities Act. The Purchaser understands that the Company is under no
obligation to register any of the securities sold hereunder.
5. Stock Certificate Legends. The share certificate evidencing the
Shares issued hereunder shall be endorsed with the following legends:
(a) THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND HAVE
BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE
SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE ACT OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.
(b) Any legend required by the Company's Bylaws and any
applicable state securities laws.
6. Market Stand-Off Agreement. The Purchaser hereby agrees, if so
requested by the managing underwriters or the Company in connection with the
initial public offering of the Company's Common Stock, that, without the prior
written consent of such managing underwriters, the Purchaser will not offer,
sell, contract to sell, grant any option to purchase, make any short sale or
otherwise dispose of, assign any legal or beneficial interest in or make a
distribution of any capital stock of the Company held by or on behalf of the
Purchaser or beneficially owned by the Purchaser in accordance with the rules
and regulations of the Securities and Exchange Commission for a period of up to
180 days after the date of the final prospectus relating to the Company's
initial public offering.
7. California Corporate Securities Law. THE SALE OF THE SECURITIES
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR
PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT
FROM THE QUALIFICATION BY SECTION 25100, 25102, OR 25105 OF THE CALIFORNIA
CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY
CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO
EXEMPT.
8. General Provisions.
(a) This Agreement shall be governed by the laws of the State
of California. This Agreement represents the entire agreement between the
parties with respect to the purchase of Common Stock by the Purchaser and may
only be modified or amended in writing signed by both parties.
(b) Any notice, demand or request required or permitted to be
given by either the Company or the Purchaser pursuant to the terms of this
Agreement shall be in writing and shall
be deemed given when delivered personally or deposited in the U.S. mail, First
Class with postage prepaid, and addressed to the parties at the addresses of the
parties set forth at the end of this Agreement or such other address as a party
may request by notifying the other in writing.
(c) The rights and benefits of the Company under this
Agreement shall be transferable to any one or more persons or entities, and all
covenants and agreements hereunder shall inure to the benefit of, and be
enforceable by the Company's successors and assigns. The rights and obligations
of the Purchaser under this Agreement may only be assigned with the prior
written consent of the Company and any purported transfer otherwise shall be
null and void.
(d) Either party's failure to enforce any provision or
provisions of this Agreement shall not in any way be construed as a waiver of
any such provision or provisions, nor prevent that party thereafter from
enforcing each and every other provision of this Agreement. The rights granted
both parties herein are cumulative and shall not constitute a waiver of either
party's right to assert all other legal remedies available to it under the
circumstances.
(e) Purchaser acknowledges that the Shares are subject to a
right of first refusal pursuant to the Company's Bylaws, a copy of which is
available from the Secretary of the Company.
(f) The Purchaser agrees upon request to execute any further
documents or instruments necessary or desirable to carry out the purposes or
intent of this Agreement.
(g) Purchaser has reviewed this Agreement in its entirety, has
had an opportunity to obtain the advice of counsel prior to executing this
Agreement and fully understands all provisions of this Agreement.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first set forth above.
COMPANY: PURCHASER:
SOMAXON PHARMACEUTICALS, INC.,
a Delaware corporation /s/ Xxxxx Xxxx
--------------------------------
Xxxxx Xxxx
By: /s/ Xxxxxxx Xxxxx Address: c/o Key Concepts
------------------------------------ 13880 Perdido Key
Name: Xxxxxxx Xxxxx Florida 32507
Title: President and Chief Executive
Officer
Address: 00000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Acknowledged and Agreed:
PROCOM ONE, INC.
By: /s/ Xxxx Xxxxx
------------------------------------
Name: Xxxx X. Xxxxx, M.D.
Title:
