Exhibit 2.1
ISIS PHARMACEUTICALS, INC.
SECURITIES PURCHASE AGREEMENT
Dated as of August 17, 2001
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT, dated as of August 17,
2001 (this "Agreement"), is by and between Isis Pharmaceuticals, Inc., a
Delaware corporation (the "Company"), and Xxx Xxxxx and Company, an Indiana
corporation (the "Purchaser").
WHEREAS, the Company and the Purchaser wish to enter into a
collaboration arrangement pursuant to which they will conduct certain research
and development programs relating to antisense oligonucleotides;
WHEREAS, to further these joint collaboration efforts, the
Company wishes to issue and sell to the Purchaser an aggregate of four million
one hundred sixty-six thousand six hundred sixty-seven (4,166,667) shares (the
"Shares") of the Company's Common Stock, par value $.001 per share of the
Company ("Common Stock");
WHEREAS, the Purchaser wishes to purchase the Shares on the
terms and subject to the conditions set forth in this Agreement; and
WHEREAS, in conjunction with the purchase and sale of the
Shares pursuant to this Agreement, the Company and the Purchaser are entering
into a Loan Agreement (the "Loan Agreement"), pursuant to which the Company
shall issue a promissory note (the "Note") in favor of the Purchaser, a
Collaboration Agreement (the "Collaboration Agreement"), and a Registration
Rights and Standstill Agreement (the "Registration Rights Agreement"), each as
of the date hereof;
NOW, THEREFORE, in consideration of the promises and the
mutual covenants contained in this Agreement, the parties agree as follows:
ARTICLE I
PURCHASE OF SHARES
SECTION 1.01. PURCHASE AND SALE OF SHARES. Subject to the
terms and conditions hereof and on the basis of the representations and
warranties set forth herein, the Company agrees to issue and sell to the
Purchaser, and the Purchaser agrees to purchase the Shares from the Company, at
the Closing (as defined below), at a per share price equal to $18.00 for an
aggregate purchase price of Seventy-Five Million and Six Dollars ($75,000,006).
SECTION 1.02. CLOSING. The closing of the purchase and sale of
the Shares (the "Closing") shall take place at the offices of Xxx Lilly and
Company, Lilly Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000, at 10:00 a.m.,
Indianapolis time, on the third business day following the termination or
expiration of the required waiting period under the HSR Act (as defined below),
or at such other location, date and time as may be agreed upon by the Purchaser
and the Company (such date and time being referred to herein as the "Closing
Date"). At the Closing, the Company shall issue and deliver to the Purchaser a
stock certificate, registered in the name of the Purchaser, representing the
Shares, against payment of the purchase price therefor by wire transfer.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company represents and warrants to the Purchaser that,
except as set forth in the Disclosure Schedule attached hereto (the "Disclosure
Schedule"):
SECTION 2.01. ORGANIZATION. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. The Company has all requisite corporate power and authority and all
requisite licenses, permits and approvals of Governmental Entities (as defined
below) to carry on the businesses as they are now being conducted and to own and
use the properties owned and used by it except where the failure to obtain such
licenses, permits and approvals would not have a Company Material Adverse
Effect. The Company is not in default under or in violation of any provision of
its Certificate of Incorporation or Bylaws. The Company is duly qualified to do
business and is in good standing as a foreign corporation in each other
jurisdiction in which the ownership, operation or leasing of its properties or
assets or the nature of its business requires such qualification, except where
the failure so to qualify would not have a Company Material Adverse Effect (as
defined below). Each of the Company's subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. Each such subsidiary has all requisite
corporate power and authority, and all requisite licenses, permits and approvals
of Governmental Entities, to carry on the business as it is now being conducted
and to own and use the properties owned and used by it except where the failure
to obtain such licenses, permits and approvals would not have a Company Material
Adverse Effect. No such subsidiary is in default under or in violation of any
provision of its certificate or articles of incorporation or Bylaws. Each such
subsidiary is duly qualified to do business and is in good standing as a foreign
corporation in each other jurisdiction in which the ownership, operation or
leasing of its properties or assets or the nature of its business requires such
qualification, except where the failure so to qualify would not have a Company
Material Adverse Effect.
SECTION 2.02 CAPITALIZATION. The Company has reserved a sufficient
number of shares of Common Stock: (i) for issuance of the Shares to the
Purchaser at the Closing, and (ii) for issuance upon conversion of the Note. The
Shares, when issued against payment therefor in accordance with this Agreement,
will be duly and validly issued, fully paid and nonassessable, will not be
issued in violation of any preemptive or similar rights. The shares of Common
Stock underlying the Note, when issued upon conversion thereof, will be duly and
validly issued, fully paid and nonassessable, and will not be issued in
violation of any preemptive or similar rights. Section 2.02 of the Disclosure
Schedule sets forth the capitalization table of the Company's capital stock on a
fully diluted basis as of June 30, 2001, subject to the assumptions and
projections set forth therein with regard to which the Company makes no
representation as to their reasonableness or appropriateness.
SECTION 2.03. REGISTRATION RIGHTS. Except as provided herein,
pursuant to the Registration Rights Agreements with Elan International Services,
Ltd., and granted in connection with the Purchase Agreement dated October 24,
1997 for 14% Subordinated Discount Notes due November 1, 2007 and Warrants to
Purchase Common Stock between the Company and the Purchaser listed on Schedule I
thereto, the Company is not under any contractual obligation to register any of
its presently outstanding securities or any of its securities which may
hereafter be issued.
SECTION 2.04. AUTHORIZATION OF TRANSACTION. The Company has
all requisite power and authority to execute and deliver this Agreement and to
perform its obligations hereunder. The execution and delivery by the Company of
this Agreement and the Loan Agreement, the Note, the Collaboration Agreement and
the Registration Rights Agreement (each, a "Company Ancillary Document"), the
performance by the Company of its obligations hereunder and thereunder, and the
consummation of the transactions contemplated hereunder and thereunder, have
been duly authorized by all requisite corporate action of the Company and will
not violate the Certificate of Incorporation or Bylaws of the Company or any
provision of any agreement or other instrument filed as an exhibit to the
Company Reports except where such violation would not materially impede the
Company's ability to perform its obligations under this Agreement.
SECTION 2.05. VALIDITY. This Agreement has been duly executed
and delivered by the Company and constitutes the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms except (a) that enforcement may be limited by (i) applicable
bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar
laws affecting creditors' rights, and (ii) general equity principles and
limitations on the availability of equitable relief, including specific
performance, and (b) that any rights to indemnity or contribution hereunder or
thereunder may be limited by state and federal securities laws and by public
policy considerations.. Each Company Ancillary Document to which the Company is
a party, when executed and delivered in accordance with this Agreement, will
constitute the legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms except (a) that enforcement may
be limited by (i) applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting creditors' rights, and
(ii) general equity principles and limitations on the availability of equitable
relief, including specific performance, and (b) that any rights to indemnity or
contribution hereunder or thereunder may be limited by state and federal
securities laws and by public policy considerations.
SECTION 2.06. NONCONTRAVENTION. Subject to compliance with the
applicable requirements of the Securities Act of 1933, as amended (the
"Securities Act"), and any applicable state securities laws and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), neither the execution and
delivery of this Agreement or the Company Ancillary Documents by the Company nor
the consummation by the Company of the transactions contemplated hereby, will
(a) require on the part of the Company any filing with, or permit,
authorization, consent or approval of, any court, arbitrational tribunal,
administrative agency or commission or other governmental authority or
regulatory agency (a "Governmental Entity"), except for (i) any filing, permit,
authorization, consent or approval which if not obtained or made would not have
a material adverse effect on the assets, business, financial condition, results
of operations or future prospects (other than prospects relating to the economy
in general or the pharmaceutical or biotechnology industries in general) of the
Company (a "Company Material Adverse Effect") or on the ability of the Company
and Purchaser to consummate the transactions contemplated by this Agreement,
(ii) such filings, if any, as may be required under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended, and the rules and regulations
promulgated thereunder (the "HSR Act"), or (iii) any such filing, or permit,
authorization, consent or approval which may be properly obtained following the
Closing, (b) conflict with, result in breach of, constitute (with or without due
notice or lapse of time or both) a default under, result in the acceleration of,
create in any party any right to accelerate, terminate, modify or cancel, or
require any notice, consent or waiver under, any contract, lease, sublease,
license, sublicense, franchise, permit, indenture, agreement or mortgage for
borrowed money, instrument of indebtedness, Security Interest (as defined below)
or other arrangement to which the Company is a party or by which it is bound or
to which any of its assets is subject, other than any conflict, breach, default,
acceleration, termination, modification or cancellation which individually or in
the aggregate would not have a Company Material Adverse Effect or have a
material adverse effect on the ability of the parties to consummate the
transactions contemplated by this Agreement, or (c) violate any order, writ,
injunction, decree, statute, rule or regulation applicable to the Company or any
of its properties or assets which individually or in the aggregate would have a
Company Material Adverse Effect or have a material adverse effect on the ability
of the parties to consummate the transactions contemplated by this Agreement.
For purposes of this Agreement, "Security Interest" means any
mortgage, pledge, security interest, encumbrance, charge or other lien (whether
arising by contract or operation of law), other than (a) mechanic's,
materialmen's and similar liens, (b) liens arising under worker's compensation,
unemployment insurance, social security, retirement, and similar legislation,
and (c) liens on goods in transit incurred pursuant to documentary letters of
credit, in each case arising in the ordinary course of business consistent with
past practice and custom.
SECTION 2.07. REPORTS AND FINANCIAL STATEMENTS.
(a) The Company has timely filed with the
Securities and Exchange Commission (the "SEC") all reports required to be filed
by the Company under Section 13 of the Exchange Act with the SEC (such reports
are collectively referred to herein as the "Company Reports"). As of their
respective dates, the Company Reports did not contain any 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. The audited financial statements and
unaudited interim financial statements of the Company included in the Company
Reports (i) comply as to form in all material respects with applicable
accounting requirements and the published rules and regulations under the
Exchange Act as promulgated by the SEC with respect thereto, (ii) have been
prepared in accordance with United States generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the periods covered
thereby (except as may be indicated therein or in the notes thereto, and in the
case of quarterly financial statements, as permitted by Form 10-Q under the
Exchange Act and subject to normal year end audit adjustments), (iii) fairly
present the consolidated financial condition, results of operations and cash
flows of the Company as of the respective dates thereof and for the periods
referred to therein, and (iv) are consistent with the books and records of the
Company.
(b) As to each contract that is material to the
Company's business and which has been filed by the Company as an exhibit to any
of the Company Reports, neither the Company nor, to the knowledge of the
Company, any other party thereto is in breach or default thereunder, other than
breaches or defaults which do not, either individually or in the aggregate, have
a Company Material Adverse Effect.
SECTION 2.08 ENVIRONMENTAL AND SAFETY LAWS. To the best of its
knowledge, the Company is not in violation of any applicable statute, law or
regulation relating to the environment or occupational health and safety other
than violations which would not result in a Company Material Adverse Effect, and
to the best of its knowledge, no material expenditures are or will be required
in order to comply with any such existing statute, law or regulation.
SECTION 2.09 ABSENCE OF MATERIAL ADVERSE CHANGES. As of the
date of this Agreement, since June 30, 2001, except as contemplated by this
Agreement and the Company Ancillary Documents, the Company has not (a) made,
paid or declared any dividend or distribution to any equity holder (in such
capacity), (b) varied its business plan or practices, in any material respect,
from past practices, (c) entered into any financing, joint venture, license or
similar arrangement that would limit or restrict its ability to perform its
obligations hereunder and under each of the other Company Ancillary Documents to
which it is a party, (d) suffered or permitted to be incurred any liability or
obligation or any lien or encumbrance against any of its properties or assets
that would limit or restrict its ability to perform its obligations hereunder
and under each of the other Company Ancillary Documents to which it is a party,
or (e) no other event shall have occurred which can be reasonably expected to
result in any Company Material Adverse Effect.
SECTION 2.10 ABSENCE OF UNDISCLOSED LIABILITIES. The Company
has no material obligations or liabilities of any nature (matured or unmatured,
fixed or contingent) other than (a) those set forth or adequately provided for
in the Company Reports, (b) those incurred in the ordinary course of business
and not required to be set forth in the balance sheet included in its most
recent Company Report under GAAP, (c) those incurred in the ordinary course of
business since the date of the Company's balance sheet included in its most
recent Company Report and not reasonably likely to have a Company Material
Adverse Effect, and (d) those incurred in connection with the execution of this
Agreement.
SECTION 2.11 BROKERS' FEES. Other than payments to be made to
XX Xxxxx, the Company has no liability or obligation to pay any fees or
commissions to any broker, finder or agent with respect to the transactions
contemplated by this Agreement.
SECTION 2.12 RESTRICTIONS ON THE SHARES. The Shares are not
subject to any restriction on transfer imposed by the Company, except
restrictions on resale of the Shares imposed pursuant to the Securities Act or
applicable state securities laws and restrictions pursuant to this Agreement.
SECTION 2.13. LITIGATION. The Company is not a party to or, to
the actual knowledge of the Company's Chairman of the Board, Chief Executive
Officer, Chief Financial Officer or General Counsel, threatened to be made a
party to (a) any unsatisfied judgment, order, decree, stipulation or injunction
or (b) any claim, complaint, action, suit, proceeding, hearing or
investigation of or before any Governmental Entity or before any arbitrator
that, in the case of either (a) or (b), reasonably could be expected to have a
Company Material Adverse Effect or a material adverse effect on the ability of
the parties to consummate the transactions contemplated by this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants to the Company
that:
SECTION 3.01. AUTHORIZATION OF AGREEMENTS, ETC. Purchaser has
all requisite corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. The execution and delivery
by the Purchaser of this Agreement and the Loan Agreement, the Collaboration
Agreement, and the Registration Rights Agreement (each, a "Purchaser Ancillary
Document") to be delivered by the Purchaser, the performance by the Purchaser of
its obligations hereunder and thereunder, and the consummation of the
transactions contemplated hereunder and thereunder, have been duly authorized by
all requisite corporate action of the Purchaser and will not violate the
Articles of Incorporation or By-Laws of the Purchaser or any provision of any
agreement or other instrument to which the Purchaser is bound.
SECTION 3.02. VALIDITY. This Agreement has been duly executed
and delivered by the Purchaser and constitutes the legal, valid and binding
obligation of the Purchaser, enforceable against the Purchaser in accordance
with its terms except (a) that enforcement may be limited by (i) applicable
bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar
laws affecting creditors' rights, and (ii) general equity principles and
limitations on the availability of equitable relief, including specific
performance, and (b) that any rights to indemnity or contribution hereunder or
thereunder may be limited by state and federal securities laws and by public
policy considerations.. Each Purchaser Ancillary Document to which the Purchaser
is a party, when executed and delivered in accordance with this Agreement, will
constitute the legal, valid and binding obligation of the Purchaser, enforceable
against the Purchaser in accordance with its terms except (a) that enforcement
may be limited by (i) applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting creditors' rights, and
(ii) general equity principles and limitations on the availability of equitable
relief, including specific performance, and (b) that any rights to indemnity or
contribution hereunder or thereunder may be limited by state and federal
securities laws and by public policy considerations..
SECTION 3.03. INVESTMENT REPRESENTATIONS. The Purchaser (a) is
an "accredited investor" within the meaning of Rule 501 promulgated under the
Securities Act and was not organized for the specific purpose of acquiring the
Shares or the Note issued pursuant to the Loan Agreement; (b) is domiciled in
the State of Indiana; (c) is acquiring the Shares and the Note issued pursuant
to the Loan Agreement for its own account for the purpose of investment and not
with a view to or for sale in connection with any distribution thereof; and (d)
understands that (i) the Shares and the Note issued pursuant to the Loan
Agreement have not been registered under the Securities Act by reason of their
issuance in a transaction exempt from the registration requirements of the
Securities Act pursuant to Section 4(2) thereof or Regulation D promulgated
under the Securities Act, (ii) the Shares and the Note issued pursuant to the
Loan Agreement must be held indefinitely unless a subsequent disposition thereof
is registered under the Securities Act or is exempt from such registration and
understands and is capable of bearing the economic risk of such an investment in
the Shares and the Note issued pursuant to the Loan Agreement, (iii) the Shares
and the Note issued pursuant to the Loan Agreement will bear a legend to such
effect (as set forth below) and (iv) the Company will make a notation on its
transfer books to such effect.
The Shares shall bear substantially the following legend:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended, or
applicable state securities laws. The shares have been
acquired for investment and may not be sold, transferred or
otherwise disposed of except in compliance with such act and
laws."
SECTION 3.04. BROKERS' FEES. Other than payments to be made
to Xxxxxxx Xxxxx & Co., the Purchaser has no liability or obligation to pay any
fees or commissions to any broker, finder or agent with respect to the
transactions contemplated by this Agreement.
SECTION 3.05. NONCONTRAVENTION. Subject to compliance with the
applicable requirements of the Securities Act, and any applicable state
securities laws and the Exchange Act, neither the execution and delivery of this
Agreement or the Purchaser Ancillary Documents by the Purchaser nor the
consummation by the Purchaser of the transactions contemplated hereby, will (a)
require on the part of the Purchaser any filing with, or permit, authorization,
consent or approval of, any Governmental Entity, except for (i) any filing,
permit, authorization, consent or approval which if not obtained or made would
not have a material adverse effect on the assets, business, financial condition,
results of operations or future prospects (other than prospects relating to the
economy in general or the pharmaceutical or biotechnology industries in general)
of the Purchaser (a "Purchaser Material Adverse Effect") or on the ability of
the Company and Purchaser to consummate the transactions contemplated by this
Agreement, (ii) such filings, if any, as may be required under the HSR Act, or
(iii) any such filing, or permit, authorization, consent or approval which may
be properly obtained following the Closing, (b) conflict with, result in breach
of, constitute (with or without due notice or lapse of time or both) a default
under, result in the acceleration of, create in any party any right to
accelerate, terminate, modify or cancel, or require any notice, consent or
waiver under, any contract, lease, sublease, license, sublicense, franchise,
permit, indenture, agreement or mortgage for borrowed money, instrument of
indebtedness, Security Interest or other arrangement to which the Purchaser is a
party or by which it is bound or to which any of its assets is subject, other
than any conflict, breach, default, acceleration, termination, modification or
cancellation which individually or in the aggregate would not have a Purchaser
Material Adverse Effect or have a material adverse effect on the ability of the
parties to consummate the transactions contemplated by this Agreement, or (c)
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to the Purchaser or any of its properties or assets which
individually or in the aggregate would have a Purchaser Material Adverse Effect
or have a material adverse effect on the ability of the parties to consummate
the transactions contemplated by this Agreement.
ARTICLE IV
CONDITIONS
SECTION 4.01. CONDITIONS TO PURCHASER'S OBLIGATIONS. The
obligation of the Purchaser to purchase and pay for the Shares is subject to the
satisfaction, on or before the Closing Date, of each of the following
conditions, each of which may be waived at the option of the Purchaser:
(a) REPRESENTATIONS AND WARRANTIES TO BE TRUE AND
CORRECT. The representations and warranties contained in Article II and
any Company Ancillary Document shall be true, complete and correct on
and as of the Closing Date with the same effect as though such
representations and warranties had been made on and as of such date,
except to the extent such representations and warranties expressly
relate to an earlier date, in which case, they shall be true, complete
and correct as of such date.
(b) PERFORMANCE. The Company shall have performed all
obligations and agreements and complied with all covenants to be
performed or complied with by them on or before the Closing Date
pursuant to this Agreement and any Company Ancillary Document.
(c) CLOSING CERTIFICATES. The Purchaser shall have
received a certificate from an officer of the Company, dated the
Closing Date, in form and substance reasonably satisfactory to the
Purchaser and its counsel, certifying that (i) the conditions set forth
in Section 4.01(a) and Section 4.01(b) have been satisfied and (ii)
resolutions approving this Agreement and each Company Ancillary
Document and the transactions contemplated hereby and thereby have been
duly adopted by the Board of Directors of the Company.
(d) PROCEEDINGS SATISFACTORY. All actions,
proceedings, instruments and documents required to carry out the
transactions contemplated by this Agreement or incidental hereto, and
all other related legal matters, shall be reasonably satisfactory to
counsel to the Purchaser, and such counsel shall have been furnished
with such other instruments and documents as they shall have reasonably
requested.
(e) OPINION OF COMPANY'S GENERAL COUNSEL. The
Purchaser shall have received from the Company's General Counsel, an
opinion dated the Closing Date, with respect to the matters set forth
on EXHIBIT A.
(f) REVIEW OF BUSINESS AND LEGAL MATTERS. The
Purchaser and its accountants and counsel shall have completed a review
of business, accounting and legal matters with respect to the Company
prior to the execution hereof, and nothing shall have come to the
attention of the Purchaser or its counsel or accountants prior to the
execution hereof that causes the Purchaser to reasonably conclude that
(i) the Company Reports do not present fairly the financial position
and results of operations of the Company as of their respective dates,
or (ii) there
is any material breach or inaccuracy in the representations and
warranties of the Company set forth in this Agreement or any Company
Ancillary Document.
(g) NO MATERIAL ADVERSE CHANGE. Since the date
hereof, there shall not have occurred and be continuing, and no event
shall have occurred which (in the reasonable judgment of the Purchaser)
can be reasonably expected to result in any Company Material Adverse
Effect.
(h) REGISTRATION RIGHTS AGREEMENT. The Company
shall have executed and delivered the Registration Rights Agreement.
(i) COLLABORATION AGREEMENT. The Company shall
have executed and delivered the Collaboration Agreement and all
conditions to commencement of the collaboration to be performed by the
Company thereunder prior to its effectiveness shall have been
satisfied.
(j) LOAN AGREEMENT AND NOTE. The Company shall
have executed and delivered the Loan Agreement and the Note.
(k) OTHER APPROVALS. If applicable, the waiting
period under the HSR Act shall have expired or been terminated. All
other consents, authorizations and approvals, waivers or exemptions,
and filings and registrations, required to be obtained from or made
with any person in connection with the execution, delivery and
performance by the Company of this Agreement and the Company Ancillary
Documents and the consummation by the Company of the transactions
contemplated hereby and thereby shall have been obtained or made, and
all required filings shall have become effective except for such
filings which may be properly made following the Closing.
(l) NO LITIGATION. No injunction shall be
outstanding, which would prevent consummation of the transactions
contemplated by this Agreement or the Company Ancillary Documents. No
action, suit or proceeding shall be pending or threatened in writing by
any government agency or instrumentality or other person, with respect
to which the Purchaser shall have reasonably concluded that the
plaintiff has a reasonable probability of prevailing, and wherein an
unfavorable judgment, order, decree, stipulation or injunction would
(i) cause the transactions contemplated by this Agreement or the
Company Ancillary Documents to be rescinded following consummation,
(ii) materially and adversely affect the right of the Company to own,
operate or control its business in the manner contemplated by the
Company Ancillary Documents, or (iii) cause the Purchaser or the
Company to be subject to any material award of damages or governmental
sanction.
SECTION 4.02. CONDITIONS TO OBLIGATIONS OF THE COMPANY. The
obligations of the Company to consummate the transactions contemplated hereby
are subject to the satisfaction, on or before the Closing Date, of each of the
following conditions, each of which may be waived at the option of the Company:
(a) REPRESENTATIONS AND WARRANTIES TO BE TRUE AND
CORRECT. The representations and warranties contained in Article III
and any Purchaser Ancillary Document shall be true, complete and
correct on and as of the Closing Date with the same effect as though
such representations and warranties had been made on and as of such
date.
(b) PERFORMANCE. The Purchaser shall have performed
all obligations and agreements and complied with all covenants to be
performed or complied with by it on or before the Closing Date pursuant
to this Agreement or any Purchaser Ancillary Document.
(c) CLOSING CERTIFICATES. The Company shall have
received a certificate from an officer of the Purchaser, dated the
Closing Date, in form and substance reasonably satisfactory to the
Company and its counsel, certifying that (i) the conditions set forth
in Section 4.02(a) and Section 4.02(b) have been satisfied and (ii)
resolutions approving this Agreement and each Purchaser Ancillary
Document and the transactions contemplated hereby and thereby have been
duly adopted by the Board of Directors of the Purchaser.
(d) PROCEEDINGS SATISFACTORY. All actions,
proceedings, instruments and documents required to carry out the
transactions contemplated by this Agreement or incidental hereto, and
all other related legal matters, shall be reasonably satisfactory to
counsel to the Company, and such counsel shall have been furnished with
such other instruments and documents as they shall have reasonably
requested.
(e) REGISTRATION RIGHTS AGREEMENT. The Purchaser
shall have executed and delivered the Registration Rights Agreement.
(f) COLLABORATION AGREEMENT. The Purchaser shall
have executed and delivered the Collaboration Agreement and all
conditions to commencement of the collaboration to be performed by the
Purchaser thereunder prior to its effectiveness shall have been
satisfied.
(g) LOAN AGREEMENT. The Purchaser shall have
executed and delivered the Loan Agreement and made the first
Disbursement under the Loan Agreement.
(h) OTHER APPROVALS. If applicable, the waiting
period under the HSR Act shall have expired or been terminated. All
other consents, authorizations and approvals, waivers or exemptions,
and filings and registrations, required to be obtained from or made
with any person in connection with the execution, delivery and
performance by the Purchaser of this Agreement and the Purchaser
Ancillary Documents and the consummation by the Purchaser of the
transactions contemplated hereby and thereby shall have been obtained
or made, and all required filings shall have become effective except
for such filings which may be properly made following the Closing.
(i) NO LITIGATION. No injunction shall be
outstanding, which would prevent consummation of the transactions
contemplated by this Agreement or the Purchaser Ancillary Documents. No
action, suit or proceeding shall be pending or threatened in writing by
any government agency or instrumentality or other person, with respect
to which the Company shall have reasonably concluded that the plaintiff
has a reasonable probability of prevailing, and wherein an unfavorable
judgment, order, decree, stipulation or injunction would (i) cause the
transactions contemplated by this Agreement or the Purchaser Ancillary
Documents to be rescinded following consummation or (ii) cause the
Company or the Purchaser to be subject to any material award of damages
or governmental sanction.
ARTICLE V
TERMINATION
SECTION 5.01. TERMINATION. This Agreement may be terminated
and the transactions contemplated hereby may be abandoned at any time prior to
the Closing:
(a) by mutual written consent of the Purchaser and the
Company;
(b) by the Purchaser, if (i) there has been a material breach
by the Company of any representation, warranty, covenant or agreement
set forth in this Agreement or any Company Ancillary Document that has
not been corrected by the Company within ten (10) days of receiving
notice of such breach from Purchaser or (ii) the Closing shall not have
occurred on or prior to December 31, 2001, by reason of the failure of
any condition precedent set forth in Section 4.01, unless such failure
results primarily from the breach by the Purchaser of any of its
representations, warranties, covenants or agreements set forth in this
Agreement or any Purchaser Ancillary Document; or
(c) by the Company, if (i) there has been a material breach by
the Purchaser of any representation, warranty, covenant or agreement
set forth in this Agreement or any Purchaser Ancillary Document that
has not been corrected by Purchaser within ten (10) days of receiving
notice of such breach from the Company or (ii) the Closing shall not
have occurred on or prior to December 31, 2001, by reason of the
failure of any condition precedent set forth in Section 4.02, unless
such failure results primarily from the breach by the Company of any of
its representations, warranties, covenants or agreements set forth in
this Agreement or any Company Ancillary Document.
SECTION 5.02. PROCEDURE UPON TERMINATION. If this Agreement is
terminated pursuant to Section 5.01, the party terminating this Agreement shall
promptly deliver written notice thereof to the other party hereto, and, upon
such notice, this Agreement shall terminate and the transactions contemplated
hereby shall be abandoned without further action on the part of either of the
parties hereto, but such termination shall not relieve either party of
responsibility for damages arising out of any breach by such party.
ARTICLE VI
CONFIDENTIALITY; NON-DISCLOSURE; COOPERATION
SECTION 6.01. CONFIDENTIALITY; NON-DISCLOSURE. The parties
hereto agree that the provisions of the Collaboration Agreement relating to
confidentiality and non-disclosure are incorporated herein by reference.
SECTION 6.02. COOPERATION UPON SALE OF SECURITIES. In the
event that the Purchaser or any affiliate transferee of Purchaser proposes to
sell, transfer or otherwise dispose of any securities of the Company prior to
the termination of the Collaboration Agreement, the Purchaser or such affiliate
transferee, as appropriate, shall notify the Company in writing at least fifteen
(15) days prior to such proposed sale, transfer or other disposition thereof and
further agrees to cooperate and coordinate with the Company in the development
by the Purchaser or such affiliate transferee, as appropriate, and the Company
of a standby statement to be used in responding to any inquiries from third
parties (or if deemed appropriate by the Company or the Purchaser or such
affiliate transferee, as appropriate, a press release of that party) that would,
as appropriate, indicate the continuing strong support by the Purchaser or such
affiliate transferee, as appropriate, of the collaboration activities, and the
Company, notwithstanding the decision of the Purchaser or such affiliate
transferee, as appropriate, to dispose of some of its holdings of the Company's
securities. Subject to the required notice above, the Company and the Purchaser
or affiliate transferee shall provide each other with comments on any such
proposed standby statement or press release in such manner as is necessary to
not cause a delay in the Purchaser's or such affiliate transferee's, as
appropriate, proposed sale, transfer or other disposition of such securities.
Purchaser shall cause any affiliate transferee to agree to be bound by this
Section 6.02.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. PARTIES IN INTEREST. All representations,
covenants and agreements contained in this Agreement by or on behalf of the
parties hereto shall bind and inure to the benefit of the respective successors
and assigns of the parties hereto whether so expressed or not. Without limiting
the generality of the foregoing, all representations, covenants and agreements
benefiting the Purchaser shall inure to the benefit of any and all subsequent
holders from time to time of the Shares.
SECTION 7.02. SURVIVAL OF AGREEMENTS. All covenants,
agreements, representations and warranties of the parties made in Articles 2 and
3 of this Agreement, any Company Ancillary Document, or any Purchaser Ancillary
Document shall survive the execution and delivery of this Agreement, any
investigation at any time made by the Purchaser or on its behalf, and the
issuance, sale and delivery of the Shares.
SECTION 7.03. NOTICES. All notices and other communications
that are required or permitted to be given under this Agreement shall be in
writing and shall be delivered
personally, mailed by certified or registered mail, return receipt requested,
sent by reputable overnight courier or sent by confirmed telecopier, addressed
as follows:
(a) if to the Company, at 0000 Xxxxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxxxx 00000, Attention: Chief Financial Officer, telephone:
000-000-0000; fax: 000-000-0000 with a copy (which shall not constitute
notice to the Company) to Xxxxxx Godward LLP, 0000 Xxxxxxxxx Xxxxx,
Xxxxx 0000, Xxx Xxxxx, XX 00000, Attn: Xxxxx X. Xxxxxxxx, telephone
000-000-0000; fax 000-000-0000; and
(b) if to the Purchaser, at Xxxxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxx, Esq.,
Senior Vice President and General Counsel, telephone: 000-000-0000;
fax: 000-000-0000, with a copy (which shall not constitute notice to
the Purchaser) to Xxx Lilly and Company, Xxxxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X. XxXxxxxx, Group Vice
President, Lilly Research Laboratories, telephone: 000-000-0000; fax
000-000-0000.
or to such other address and/or such other addressee as any of the above shall
have specified by notice hereunder. Each notice or other communication that
shall be delivered personally, mailed, sent by overnight courier or telecopied
in the manner described above shall be deemed sufficiently given, served, sent,
received or delivered for all purposes at such time as it is delivered to the
addressee (with the return receipt, the delivery receipt or the affidavit of
messenger being deemed conclusive, but not exclusive, evidence of such delivery)
or at such time as delivery is refused by the addressee upon presentation.
SECTION 7.04. ASSIGNMENT. Neither the Company nor the
Purchaser may assign any of its rights or obligations hereunder without the
express written consent of the other party. The Purchaser shall not transfer,
sell or otherwise dispose of any of the Shares or other securities of the
Company issued pursuant to the Loan Agreement or otherwise, without the prior
written permission of the Company until the earlier of (i) the termination of
the Collaboration Agreement and (ii) the fourth anniversary of the Closing;
provided, however, that subject to Section 6.02, following the first anniversary
of the Closing, Purchaser may sell, transfer or otherwise dispose of the Shares
or other securities of the Company issued pursuant to the Loan Agreement or
otherwise (i) pursuant to Rule 144 of the Securities Act or (ii) to one or more
persons in private placements exempt from registration under the Securities Act,
pursuant to Section 4(1) thereof or otherwise, if such person or persons satisfy
all investor suitability requirements and other restrictions on transfer under
applicable federal and state securities laws and regulations, except that the
Purchaser shall not resell Common Stock to any person or group as such terms are
defined in Section 13 of the Exchange Act and regulations thereunder that would
result in such person or group beneficially owning more than three percent (3%)
of the then outstanding shares of Common Stock of the Company; and provided
further, that Purchaser may sell, transfer or otherwise dispose of Registrable
Securities in a registered transaction pursuant to and as provided by the
Registration Rights Agreement; provided further that Purchaser shall cause any
affiliate transferee to agree to be bound by this Section 7.04.
SECTION 7.05. REMEDIES. If any party to this Agreement obtains
a judgment against any party hereto by reason of any breach of this Agreement or
the failure of such other
party to comply with the provisions hereof, a reasonable attorneys' fee as fixed
by the court shall be included in such judgment. No remedy conferred upon any
party to this Agreement is intended to be exclusive of any other remedy herein
or by law provided or permitted, but each such remedy shall be cumulative or
shall be in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute.
SECTION 7.06. WAIVER. None of the terms of this Agreement
shall be deemed to have been waived by any party hereto, unless such waiver is
in writing and signed by that party. No action taken pursuant to this Agreement,
including any investigation by or on behalf of any party hereto, shall be deemed
to constitute a waiver by the party taking such action of compliance with any
representation, warranty, covenant or agreement contained herein. The waiver by
any party hereto of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any other provision of this Agreement or
of any further breach of the provision so waived or of any other provision of
this Agreement. No extension of time for the performance of any obligation or
act hereunder shall be deemed an extension of time for the performance of any
other obligation or act. The waiver by any party of any of the conditions
precedent to its obligations under this Agreement shall not preclude it from
seeking redress for breach of this Agreement.
SECTION 7.07. GOVERNING LAW. This Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware, without
giving effect to its conflicts of law rules.
SECTION 7.08. ENTIRE AGREEMENT. This Agreement, including the
Schedules and Exhibits hereto, the Company Ancillary Documents, and the
Purchaser Ancillary Documents constitute the entire agreement of the parties
with respect to the subject matter hereof. All Schedules and Exhibits hereto are
hereby incorporated herein by reference.
SECTION 7.09. COUNTERPARTS. This Agreement may be executed in
the original or by facsimile in any number of counterparts, each of which shall
be effective only upon delivery and thereafter shall be deemed to be an
original, and all of which shall be taken to be one and the same instrument with
the same effect as if each of the parties hereto had signed the same signature
page. Any signature page of this Agreement may be detached from any counterpart
of this Agreement without impairing the legal effect of any signature thereon
and may be attached to another counterpart of this Agreement identical in form
hereto and having attached to it one or more additional signature pages.
SECTION 7.10. AMENDMENTS. This Agreement may not be amended,
modified or changed in any respect without the written consent of the Company
and the approval of the Purchaser.
SECTION 7.11. SEVERABILITY. Whenever possible, each provision
of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
unenforceable or invalid under applicable law, such provision shall be
ineffective only to the extent of such unenforceability or invalidity, and the
remaining provisions of this Agreement shall continue to be binding and in full
force and effect.
SECTION 7.12. FURTHER ASSURANCES. From and after the date
hereof, each of the parties hereto agree to do or cause to be done such further
acts and things and deliver or cause to be delivered to each other such
additional assignments, agreements, powers and instruments, as each may
reasonably require or deem advisable to carry into effect the purposes of this
Agreement, the Purchaser Ancillary Documents, and the Company Ancillary
Documents.
SECTION 7.13. HEADINGS. The section and other headings
contained in this Agreement are for convenience only and shall not be deemed to
limit, characterize or interpret any provision of this Agreement.
SECTION 7.14. CERTAIN DEFINED TERMS. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
(a) "person" shall mean an individual, corporation, limited
liability company, trust, partnership, joint venture, unincorporated
organization, government agency or any agency or political subdivision
thereof, or other entity; and
(b) "affiliate" shall mean, with respect to any person, a
person who controls such person, who is controlled by such person or
who is under common control with such person as such term is defined in
Rule 12b-2 of the Exchange Act.
(c) "subsidiary" shall mean, as to the Company, any
corporation of which more than 50% of the outstanding stock having
ordinary voting power to elect a majority of the Board of Directors of
such corporation (irrespective of whether or not at the time stock of
any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned by the Company, or by one or more of
its subsidiaries, or by the Company and one or more of its
subsidiaries.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Company and the Purchaser have
executed this Securities Purchase Agreement as of the day and year first above
written.
ISIS PHARMACEUTICALS, INC.
By: /s/ B. Xxxxx Xxxxxxxx
---------------------------------------
Name: B. Xxxxx Xxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
XXX XXXXX AND COMPANY
By: /s/ Xxxxxx Xxxxxx
-------------------------------
Printed: Xxxxxx Xxxxxx
Title: Chairman of the Board,
Chief Executive Officer and President
EXHIBIT A
[OPINION OF ISIS GENERAL COUNSEL]
(a) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has full corporate power and authority to conduct its business as presently
conducted, to enter into and perform the Agreement and the Company Ancillary
Documents and to carry out the transactions contemplated by the Agreement and
the Company Ancillary Documents. The Company is qualified to do business in the
State of California.
(b) The Shares have been duly authorized and are
duly and validly issued, fully paid and non-assessable and free of statutory
pre-emptive rights.
(c) The execution, delivery and performance by
the Company of the Agreement and the Company Ancillary Documents have been duly
authorized by all necessary corporate action and the Agreement and the Company
Ancillary Documents have been duly executed and delivered by the Company. The
Agreement and the Securities Purchase Agreement, Loan Agreement, Note and
Registration Rights Agreement constitute the valid and binding obligations of
the Company, enforceable in accordance with their terms except no opinion is
rendered as to rights of indemnity under Section 8 of the Registration Rights
Agreement and except as to enforcement of remedies to applicable bankruptcy,
insolvency, reorganization, arrangement, moratorium or similar laws affecting
generally the enforcement of creditors' rights and subject to a court's
discretionary authority with respect to the granting of a decree ordering
specific performance or other equitable principals and limitations on equitable
relief. The execution and delivery of the Agreement and the Company Ancillary
Documents and the offer, issue and sale of the Shares thereunder will not
conflict with, or result in any breach of any of the terms, conditions, or
provisions of, or constitute a default under, (i) the Certificate of
Incorporation or Bylaws of the Company or (ii) any provision of California or
federal law, statute rule or regulation or any provision of the Delaware General
Corporation Law that would result in a material adverse effect on the Company.
(d) Except as obtained and in effect at the
Closing, no consent, approval, order or authorization of, or registration,
qualification, designation, declaration, or filing with, any governmental
authority is required on the part of the Company in connection with the
execution and delivery of the Agreement, or the offer, issue, sale and delivery
of the Shares except for such state and federal securities filings which may be
properly made following the Closing.
(e) Based on the representations of Purchaser
in Article III of the Agreement, the offer, issuance and sale of the Shares
pursuant to the Agreement are exempt from registration under the Securities Act.
2.
