Exhibit 10.1
SECURITIES PURCHASE
AGREEMENT
DATED AS OF SEPTEMBER 15, 2003
AMONG
CYTRX CORPORATION
AND
THE PURCHASERS LISTED ON EXHIBIT A
TABLE OF CONTENTS
PAGE
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ARTICLE I Purchase and Sale of Common Stock and Warrants........................................................1
Section 1.1 Purchase and Sale of Common Stock and Warrants.........................................1
Section 1.2 Purchase Price and Closing.............................................................1
Section 1.3 Warrants...............................................................................2
Section 1.4 Warrant Shares.........................................................................2
ARTICLE II Representations and Warranties........................................................................2
Section 2.1 Representations and Warranties of the Company..........................................2
Section 2.2 Representations and Warranties of the Purchasers......................................13
ARTICLE III Covenants............................................................................................14
Section 3.1 Securities Compliance.................................................................15
Section 3.2 Registration and Listing..............................................................15
Section 3.3 Inspection Rights.....................................................................15
Section 3.4 Compliance with Laws..................................................................15
Section 3.5 Keeping of Records and Books of Account...............................................15
Section 3.6 Reporting Requirements................................................................15
Section 3.7 Other Agreements......................................................................16
Section 3.8 Reservation of Shares.................................................................16
Section 3.9 Disclosure of Transactions and Other Material Information.............................16
Section 3.10 Delivery of Share Certificates........................................................17
Section 3.11 No Trading in the Common Stock........................................................17
ARTICLE IV Conditions...........................................................................................17
Section 4.1 Conditions Precedent to the Obligation of the Company to Close and to
Sell the Shares and Warrants..........................................................17
Section 4.2 Conditions Precedent to the Obligation of the Purchasers to Close and
to Purchase the Shares and Warrants...................................................18
ARTICLE V Certificate Legend...................................................................................20
Section 5.1 Legend................................................................................20
ARTICLE VI Termination..........................................................................................21
Section 6.1 Termination by Mutual Consent.........................................................21
Section 6.2 Effect of Termination.................................................................21
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TABLE OF CONTENTS
(continued)
PAGE
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ARTICLE VII Indemnification.....................................................................................21
Section 7.1 General Indemnity.....................................................................21
Section 7.2 Indemnification Procedure.............................................................21
ARTICLE VIII Miscellaneous.......................................................................................22
Section 8.1 Fees and Expenses.....................................................................22
Section 8.2 Specific Enforcement; Consent to Jurisdiction.........................................23
Section 8.3 Entire Agreement; Amendment...........................................................23
Section 8.4 Notices...............................................................................24
Section 8.5 Waivers...............................................................................24
Section 8.6 Headings; Interpretation..............................................................24
Section 8.7 Successors and Assigns................................................................25
Section 8.8 No Third Party Beneficiaries..........................................................25
Section 8.9 Governing Law.........................................................................25
Section 8.10 Survival..............................................................................25
Section 8.11 Counterparts..........................................................................25
Section 8.12 Publicity.............................................................................25
Section 8.13 Severability..........................................................................25
Section 8.14 Further Assurances....................................................................26
Section 8.15 Independent Nature of Purchasers' Obligations and Rights..............................26
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SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT this ("Agreement"), dated as of
September 15, 2003, by and among CytRx Corporation, a Delaware corporation (the
"Company"), and the entities listed on Exhibit A hereto (each, a "Purchaser" and
collectively, the "Purchasers"), for the purchase and sale by the Purchasers of
shares of the Company's Common Stock, par value $0.001 per share (the "Common
Stock"), and warrants to purchase shares of Common Stock.
The parties hereto agree as follows:
ARTICLE I
PURCHASE AND SALE OF COMMON STOCK AND WARRANTS
Section 1.1 Purchase and Sale of Common Stock and Warrants. Upon the
following terms and conditions, the Company shall issue and sell to the
Purchasers, and each Purchaser shall, severally but not jointly, purchase from
the Company that number of shares of Common Stock (the "Shares") and warrants to
purchase shares of Common Stock equal to 25% of the number of Shares to be
purchased by such Purchaser, in substantially the form attached hereto as
Exhibit B (the "Warrants"), in each case, set forth opposite such Purchaser's
name on Exhibit A hereto at a price per Share and related Warrants of $2.10 for
an aggregate purchase price to the Company from each Purchasers (the "Purchase
Price") equal to the amount set forth on the signature page hereof and on
Exhibit A. The Company and the Purchasers are executing and delivering this
Agreement in accordance with and in reliance upon the exemption from securities
registration afforded by Section 4(2) of the U.S. Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder (the "Securities
Act"), including Regulation D ("Regulation D"), and/or upon such other exemption
from the registration requirements of the Securities Act as may be available
with respect to any or all of the investments to be made hereunder.
Section 1.2 Purchase Price and Closing. The Company agrees to issue
and sell to the Purchasers and, in consideration of and in express reliance upon
the representations, warranties, covenants, terms and conditions of this
Agreement, the Purchasers, severally but not jointly, agree to purchase the
number of Shares and Warrants set forth on the signature page hereof and
opposite their respective names on Exhibit A. The closing of the purchase and
sale of the Shares and Warrants to be acquired by the Purchasers from the
Company under this Agreement shall take place at the offices of the Company
located at 00000 Xxx Xxxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000
(the "Closing") at 10:00 a.m., Pacific Time (i) on or before September 15, 2003,
provided, that all of the conditions set forth in Article IV hereof and
applicable to the Closing shall have been fulfilled or waived in accordance
herewith, or (ii) at such other time and place or on such date as the Purchasers
and the Company may agree upon (the "Closing Date"). The entire Purchase Price
payable by each Purchaser shall be payable in cash, by wire transfer or in
readily available funds, at the Closing.
Section 1.3 Warrants. At the Closing, the Company shall issue to
each Purchaser such number of Warrants to purchase shares of Common Stock as is
set forth opposite such Purchaser's name on Exhibit A hereto. The Warrants shall
be exercisable for five (5) years from the date of issuance and shall have an
exercise price equal to $3.05.
Section 1.4 Warrant Shares. The Company has authorized and has
reserved and covenants to continue to reserve, free of preemptive rights and
other similar contractual rights of stockholders, a number of its authorized but
unissued shares of Common Stock equal to the aggregate number of shares of
Common Stock necessary to effect the exercise of the Warrants. Any shares of
Common Stock issuable upon exercise of the Warrants (and such shares when
issued) are herein referred to as the "Warrant Shares". The Shares, the Warrants
and the Warrant Shares are sometimes collectively referred to herein as the
"Securities".
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the Company. In order
to induce the Purchasers to enter into this Agreement and to purchase the Shares
and the Warrants, the Company hereby makes the following representations and
warranties to the Purchasers:
(a) Organization, Good Standing and Power. The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and has the requisite corporate power to own,
lease and operate its properties and assets and to conduct its business as it is
now being conducted. The Company does not have any Subsidiaries (as defined in
Section 2.1(g)) or own securities of any kind in any other entity, except as set
forth on Schedule 2.1(g) hereto. The Company and each such Subsidiary is duly
qualified as a foreign corporation to do business and is in good standing in
every jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary, except for any jurisdiction(s)
(alone or in the aggregate) in which the failure to be so qualified will not
have a Material Adverse Effect. For the purposes of this Agreement, "Material
Adverse Effect" means any adverse effect on the business, operations,
properties, prospects or financial condition of the Company or its Subsidiaries
and which is material to such entity or other entities controlling or controlled
by such entity or which is likely to materially hinder the performance by the
Company of its material obligations hereunder and under the other Transaction
Documents (as defined in Section 2.1(b) hereof).
(b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and perform this Agreement, the
Registration Rights Agreement, the Warrants, and the other agreements and
documents contemplated hereby and thereby and executed by the Company or to
which the Company is party (collectively, the "Transaction Documents"), and to
issue and sell the Shares and the Warrants in accordance with the terms hereof.
The execution, delivery and performance of the Transaction Documents by the
Company and the consummation by it of the transactions contemplated thereby have
been duly and validly authorized by all necessary corporate action, and, except
as set forth in Schedule 2.1(b), no further consent or authorization of the
Company, its Board of Directors or its
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stockholders is required. This Agreement has been duly executed and delivered by
the Company. The other Transaction Documents will have been duly executed and
delivered by the Company at the Closing. Each of the Transaction Documents
constitutes, or shall constitute when executed and delivered, a valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, reorganization, moratorium, liquidation, conservatorship,
receivership or similar laws relating to, or affecting generally the enforcement
of, creditor's rights and remedies or by other equitable principles of general
application.
(c) Capitalization. The authorized capital stock of the Company and
the shares thereof currently issued and outstanding as of September 9, 2003 are
set forth on Schedule 2.1(c) hereto. All of the outstanding shares of the
Company's Common Stock and any other security of the Company have been duly and
validly authorized. Except as set forth on Schedule 2.1(c) hereto, no shares of
Common Stock or any other security of the Company are entitled to preemptive
rights or registration rights and there are no outstanding options, warrants,
scrip, rights to subscribe to, call or commitments of any character whatsoever
relating to, or securities or rights convertible into, any shares of capital
stock of the Company. Furthermore, except as set forth on Schedule 2.1(c)
hereto, there are no contracts, commitments, understandings, or arrangements by
which the Company is or may become bound to issue additional shares of the
capital stock of the Company or options, securities or rights convertible into
shares of capital stock of the Company. Except for customary transfer
restrictions contained in agreements entered into by the Company in order to
sell restricted securities or as provided on Schedule 2.1(c) hereto, the Company
is not a party to or bound by any agreement or understanding granting
registration or anti-dilution rights to any person with respect to any of its
equity or debt securities. Except as set forth on Schedule 2.1(c), the Company
is not a party to, and it has no knowledge of, any agreement or understanding
restricting the voting or transfer of any shares of the capital stock of the
Company. Except as set forth on Schedule 2.1(c) hereto, the offer and sale of
all capital stock, convertible securities, rights, warrants, or options of the
Company issued prior to the Closing complied with all applicable federal and
state securities laws, and no holder of such securities has a right of
rescission or claim for damages with respect thereto which could have a Material
Adverse Effect. The Company has furnished or made available to the Purchasers
true and correct copies of the Company's Certificate of Incorporation as amended
and restated and in effect on the date hereof (the "Certificate"), and the
Company's Bylaws as in effect on the date hereof (the "Bylaws").
(d) Issuance of Securities. The Shares and the Warrants to be issued
at the Closing have been duly authorized by all necessary corporate action and,
when paid for or issued in accordance with the terms hereof, the Shares shall be
validly issued and outstanding, fully paid and nonassessable and free and clear
of all liens, encumbrances and rights of refusal of any kind and the holders
shall be entitled to all rights accorded to a holder of Common Stock. When the
Warrant Shares are issued and paid for in accordance with the terms of this
Agreement and as set forth in the Warrants, such shares will be duly authorized
by all necessary corporate action and validly issued and outstanding, fully paid
and nonassessable, free and clear of all liens, encumbrances and rights of
refusal of any kind and the holders shall be entitled to all rights accorded to
a holder of Common Stock.
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(e) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby do not and will not (i) violate any
provision of the Certificate or Bylaws or any Subsidiary's comparable charter
documents, (ii) conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
agreement, mortgage, deed of trust, indenture, note, bond, license, lease
agreement, instrument or obligation to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries'
respective properties or assets are bound, (iii) create or impose a lien,
mortgage, security interest, charge or encumbrance of any nature on any property
or asset of the Company or any of its Subsidiaries under any agreement or any
commitment to which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound or by which any of their
respective properties or assets are bound, or (iv) result in a violation of any
federal, state, local or foreign statute, rule, regulation, order, judgment or
decree (including federal and state securities laws and regulations) applicable
to the Company or any of its Subsidiaries or by which any property or asset of
the Company or any of its Subsidiaries is bound or affected, except, in all
cases other than violations pursuant to clauses (i) or (iv) (with respect to
federal and state securities laws) above, for such conflicts, defaults,
terminations, amendments, acceleration, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse Effect. The
business of the Company and its Subsidiaries is not being conducted in violation
of any laws, ordinances or regulations of any governmental entity, except for
possible violations which singularly or in the aggregate do not and will not
have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries
is required under federal, state, foreign or local law, rule or regulation to
obtain any consent, authorization or order of, or make any filing or
registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under the Transaction Documents or
issue and sell the Shares, the Warrants or the Warrant Shares in accordance with
the terms hereof or thereof (other than any filings which may be required to be
made by the Company with the Securities and Exchange Commission (the
"Commission") and/or the NASD prior to or subsequent to the Closing, or state
securities administrators subsequent to the Closing, or any registration
statement which may be filed pursuant hereto or thereto).
(f) Commission Documents; Financial Statements; Form S-3. The Common
Stock is registered pursuant to Section 12(b) or 12(g) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, except as disclosed
on Schedule 2.1(f) hereto, the Company has timely filed all reports, schedules,
forms, statements and other documents required to be filed by it with the
Commission pursuant to the reporting requirements of the Exchange Act, including
material filed pursuant to Section 13(a) or 15(d) of the Exchange Act (all of
the foregoing, including filings incorporated by reference therein, being
referred to herein as the "Commission Documents"). The Company has delivered or
made available to the Purchasers true and complete copies of the Commission
Documents filed with the Commission since December 31, 2000. Except for the
information regarding the Company's investment in Araios, Inc. contained in
Schedule of Exceptions to Representations and Warranties attached to this
Agreement, the Company has not provided to the Purchasers any material
non-public information or other information which, according to applicable law,
rule or regulation, should have been disclosed publicly by the Company but which
has not been so disclosed, other than with respect to the transactions
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contemplated by this Agreement. At the time of its filing, the Company's
Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2003 (the
"Form 10-Q") complied in all material respects with the requirements of the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder and other federal, state and local laws, rules and regulations
applicable to such documents, and the Form 10-Q did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. At the time of its
filing, the Company's Annual Report on Form 10-K/A for the fiscal year ended
December 31, 2002 (the "Form 10-K") complied in all material respects with the
requirements of the Exchange Act and the rules and regulations of the Commission
promulgated thereunder and other federal, state and local laws, rules and
regulations applicable to such documents, and, at the time of its filing, the
Form 10-K did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. As of their respective dates, the financial statements of
the Company included in the Commission Documents complied as to form in all
material respects with applicable accounting requirements and the published
rules and regulations of the Commission or other applicable rules and
regulations with respect thereto. Such financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") applied on
a consistent basis during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the Notes thereto or (ii) in the case
of unaudited interim statements, to the extent they may not include footnotes or
may be condensed or summary statements), and fairly present in all material
respects the financial position of the Company and its Subsidiaries as of the
dates thereof and the results of operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments). As of the date of this Agreement, the Company is eligible to
register shares of its outstanding securities on Form S-3 for sale in a
secondary offering.
(g) Subsidiaries. Schedule 2.1(g) hereto sets forth each Subsidiary
of the Company, showing the jurisdiction of its incorporation or organization
and showing the percentage of each person's ownership of the outstanding stock
or other interests of such Subsidiary. For the purposes of this Agreement,
"Subsidiary" shall mean any corporation or other entity of which at least a
majority of the securities or other ownership interest having ordinary voting
power (absolutely or contingently) for the election of directors or other
persons performing similar functions are at the time owned directly or
indirectly by the Company and/or any of its other Subsidiaries. All of the
outstanding shares of capital stock of each Subsidiary have been duly authorized
and validly issued, and are fully paid and nonassessable. There are no
outstanding preemptive, conversion or other rights, options, warrants or
agreements granted or issued by or binding upon any Subsidiary for the purchase
or acquisition of any shares of capital stock of any Subsidiary or any other
securities convertible into, exchangeable for or evidencing the rights to
subscribe for any shares of such capital stock. Neither the Company nor any
Subsidiary is subject to any obligation (contingent or otherwise) to repurchase
or otherwise acquire or retire any shares of the capital stock of any Subsidiary
or any convertible securities, rights, warrants or options of the type described
in the preceding sentence except as set forth on Schedule 2.1(g) hereto. Neither
the Company nor any Subsidiary is party to, nor has any
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knowledge of, any agreement restricting the voting or transfer of any shares of
the capital stock of any Subsidiary.
(h) No Material Adverse Change. Since June 30, 2003, the Company has
not experienced or suffered any Material Adverse Effect, except as disclosed on
Schedule 2.1(h) hereto.
(i) No Undisclosed Liabilities. Except as disclosed on Schedule
2.1(i) hereto, neither the Company nor any of its Subsidiaries has any
liabilities, obligations, claims or losses (whether liquidated or unliquidated,
secured or unsecured, absolute, accrued, contingent or otherwise) other than
those set forth in the Commission Documents or incurred in the ordinary course
of the Company's or its Subsidiaries respective businesses since June 30, 2003,
and which, individually or in the aggregate, do not or would not have a Material
Adverse Effect on the Company or its Subsidiaries.
(j) No Undisclosed Events or Circumstances. Since June 30, 2003,
except as disclosed on Schedule 2.1(j) hereto, no event or circumstance has
occurred or exists with respect to the Company or its Subsidiaries or their
respective businesses, properties, prospects, operations or financial condition,
which, under applicable law, rule or regulation, requires public disclosure or
announcement by the Company but which has not been so publicly announced or
disclosed.
(k) Indebtedness. Schedule 2.1(k) hereto sets forth as of the date
hereof all outstanding secured and unsecured Indebtedness of the Company or any
Subsidiary, or for which the Company or any Subsidiary has commitments, that is
not disclosed in the Commission Documents. For purposes of this Agreement: (x)
"Indebtedness" of any Person means, without duplication (A) any indebtedness for
borrowed money in excess of $100,000, (B) any obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into in the ordinary course of business) in excess of $100,000,
(C) all reimbursement or payment obligations with respect to letters of credit,
surety bonds and other similar instruments, (D) any obligations evidenced by
notes, bonds, debentures or similar instruments, including obligations so
evidenced incurred in connection with the acquisition of property, assets or
businesses, (E) any indebtedness in excess of $100,000 created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with GAAP, consistently
applied for the periods covered thereby, is classified as a capital lease with a
present value in excess of $100,000, (G) all indebtedness referred to in clauses
(A) through (F) above secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any mortgage,
lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or
become liable for the payment of such indebtedness, and (H) all Contingent
Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (A) through (G) above; and (y)
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"Contingent Obligation" means, as to any Person, any direct or indirect
liability, contingent or otherwise, of that Person with respect to any
indebtedness, lease, dividend or other obligation of another Person if the
primary purpose or intent of the Person incurring such liability, or the primary
effect thereof, is to provide assurance to the obligee of such liability that
such liability will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such liability will be
protected (in whole or in part) against loss with respect thereto in excess of
$100,000 due under leases required to be capitalized in accordance with GAAP.
Except as disclosed on Schedule 2.1(k), neither the Company nor any Subsidiary
is in default with respect to any Indebtedness.
(l) Title to Assets. Each of the Company and the Subsidiaries has
good and marketable title to all of its real and personal property, free and
clear of any mortgages, pledges, charges, liens, security interests or other
encumbrances of any nature whatsoever, except for those indicated on Schedule
2.1(l) hereto or such that, individually or in the aggregate, do not have a
Material Adverse Effect. All said leases of the Company and each of its
Subsidiaries are valid and subsisting and in full force and effect.
(m) Actions Pending. There is no action, suit, claim, investigation,
arbitration, alternate dispute resolution proceeding or other proceeding pending
or, to the knowledge of the Company, threatened against the Company or any
Subsidiary which questions the validity of this Agreement or any of the other
Transaction Documents or any of the transactions contemplated hereby or thereby
or any action taken or to be taken pursuant hereto or thereto. Except as set
forth on Schedule 2.1(m) hereto, there is no action, suit, claim, investigation,
arbitration, alternate dispute resolution proceeding or other proceeding pending
or, to the knowledge of the Company, threatened against or involving the
Company, any Subsidiary or any of their respective properties or assets, which
individually or in the aggregate, would have a Material Adverse Effect. There
are no outstanding orders, judgments, injunctions, awards or decrees of any
court, arbitrator or governmental or regulatory body against the Company or any
Subsidiary or any officers or directors of the Company or any Subsidiary in
their capacities as such, which individually, or in the aggregate, would have a
Material Adverse Effect.
(n) Compliance with Law. The business of the Company and the
Subsidiaries has been and is presently being conducted in accordance with all
applicable federal, state and local governmental laws, rules, regulations and
ordinances, except as set forth in the Commission Documents or on Schedule
2.1(n) hereto or such that, individually or in the aggregate, the noncompliance
therewith would not have a Material Adverse Effect. The Company and each of its
Subsidiaries have all franchises, permits, licenses, consents and other
governmental or regulatory authorizations and approvals necessary for the
conduct of its business as now being conducted by it unless the failure to
possess such franchises, permits, licenses, consents and other governmental or
regulatory authorizations and approvals, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect.
(o) Taxes. Except as set forth on Schedule 2.1(o) hereto, the
Company and each of the Subsidiaries has accurately prepared and filed all
federal, state and other tax returns required by law to be filed by it, has paid
or made provisions for the payment of all taxes shown to be due and all
additional assessments, and adequate provisions have been and are reflected in
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the financial statements of the Company and the Subsidiaries for all current
taxes and other charges to which the Company or any Subsidiary is subject and
which are not currently due and payable. Except as disclosed on Schedule 2.1(o)
hereto, none of the federal income tax returns of the Company or any Subsidiary
have been audited by the Internal Revenue Service. The Company has no knowledge
of any additional assessments, adjustments or contingent tax liability (whether
federal or state) of any nature whatsoever, whether pending or threatened
against the Company or any Subsidiary for any period, nor of any basis for any
such assessment, adjustment or contingency.
(p) Certain Fees. Except as set forth on Schedule 2.1(p) hereto, the
Company has not employed any broker or finder or incurred any liability for any
brokerage or investment banking fees, commissions, finders' structuring fees,
financial advisory fees or other similar fees in connection with the Transaction
Documents.
(q) Disclosure. To the best of the Company's knowledge, neither this
Agreement or the Schedules hereto nor any other documents, certificates or
instruments furnished to the Purchasers by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by this Agreement
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made herein or therein, in the light
of the circumstances under which they were made herein or therein, not
misleading.
(r) Intellectual Property. Schedule 2.1(r) contains a complete and
correct list of all patents, trademarks, domain names (whether or not
registered) and any patentable improvements or copyrightable derivative works
thereof, websites and intellectual property rights relating thereto, service
marks, trade names, copyrights, licenses and authorizations, and all rights with
respect to the foregoing (collectively, the "Proprietary Rights"), held by the
Company or any of its Subsidiaries. As of the date of this Agreement, neither
the Company nor any of its Subsidiaries has received any written notice that any
Proprietary Rights have been declared unenforceable or otherwise invalid by any
court or governmental agency. As of the date of this Agreement, there is, to the
knowledge of the Company, no material existing infringement, misuse or
misappropriation of any Proprietary Rights by others. From June 30, 2003 to the
date of this Agreement, neither the Company nor any of its Subsidiaries has
received any written notice alleging that the operation of the business of the
Company or any of its Subsidiaries infringes in any material respect upon the
intellectual property rights of others.
(s) Environmental Compliance. Except as disclosed on Schedule 2.1(s)
hereto, the Company and each of its Subsidiaries have obtained all material
approvals, authorization, certificates, consents, licenses, orders and permits
or other similar authorizations of all governmental authorities, or from any
other person, that are required under any Environmental Laws. Schedule 2.1(s)
hereto sets forth all material permits, licenses and other authorizations issued
under any Environmental Laws to the Company or its Subsidiaries. "Environmental
Laws" shall mean all applicable laws relating to the protection of the
environment including, without limitation, all requirements pertaining to
reporting, licensing, permitting, controlling, investigating or remediating
emissions, discharges, releases or threatened releases of hazardous substances,
chemical substances, pollutants, contaminants or toxic substances, materials or
wastes, whether solid, liquid or gaseous in nature, into the air, surface
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water, groundwater or land, or relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
hazardous substances, chemical substances, pollutants, contaminants or toxic
substances, material or wastes, whether solid, liquid or gaseous in nature.
Except as set forth on Schedule 2.1(s) hereto, the Company has all necessary
governmental approvals required under all Environmental Laws and used in its
business or in the business of any of its Subsidiaries, except for such
instances as would not individually or in the aggregate have a Material Adverse
Effect. The Company and each of its Subsidiaries are also in compliance with all
other limitations, restrictions, conditions, standards, requirements, schedules
and timetables required or imposed under all Environmental Laws. Except for such
instances as would not individually or in the aggregate have a Material Adverse
Effect, there are no past or present events, conditions, circumstances,
incidents, actions or omissions relating to or in any way affecting the Company
or its Subsidiaries that violate or may violate any Environmental Law after the
Closing or that may give rise to any Environmental Liabilities, or otherwise
form the basis of any claim, action, demand, suit, proceeding, hearing, study or
investigation (i) under any Environmental Law, or (ii) based on or related to
the manufacture, processing, distribution, use, treatment, storage (including,
without limitation, underground storage tanks), disposal, transport or handling,
or the emission, discharge, release or threatened release of any hazardous
substance. "Environmental Liabilities" means all liabilities of a person
(whether such liabilities are owed by such person to governmental authorities,
third parties or otherwise) whether currently in existence or arising hereafter
which arise under or relate to any Environmental Law.
(t) Books and Records; Internal Accounting Controls. The books,
records and documents of the Company and its Subsidiaries accurately reflect in
all material respects the information relating to the business of the Company
and the Subsidiaries, the location and collection of their assets, and the
nature of all transactions giving rise to the obligations or accounts receivable
of the Company or any Subsidiary. The Company and each of its Subsidiaries
maintain a system of internal accounting controls sufficient, in the judgment of
the Company's board of directors, to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management's general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate actions are taken with respect to any differences.
(u) Material Agreements. Except for the Transaction Documents or as
set forth on Schedule 2.1(u) hereto, or those that are included as exhibits to
the Commission Documents, neither the Company nor any Subsidiary is a party to
any written or oral contract, instrument, agreement, commitment, obligation,
plan or arrangement, a copy of which would be required to be filed with the
Commission (collectively, "Material Agreements") if the Company or any
Subsidiary were registering securities under the Securities Act. The Company and
each of its Subsidiaries has in all material respects performed all the
obligations required to be performed by them to date under the foregoing
agreements, have received no notice of default and, to the best of the Company's
knowledge, are not in default under any Material Agreement now in effect, the
result of which could cause a Material Adverse Effect. No written or oral
contract,
-9-
instrument, agreement, commitment, obligation, plan or arrangement of the
Company or of any Subsidiary limits or shall limit the payment of dividends on
its Common Stock.
(v) Transactions with Affiliates. Except as set forth in the
Commission Documents or on Schedule 2.1(v) hereto, there are no loans, leases,
agreements, contracts, royalty agreements, management contracts or arrangements
or other continuing transactions between (a) the Company, any Subsidiary or any
of their respective customers or suppliers, on the one hand, and (b) on the
other hand, any officer, employee, consultant or director of the Company, or any
of its Subsidiaries, or any person owning any capital stock of the Company or
any Subsidiary or any member of the immediate family of such officer, employee,
consultant, director or stockholder or any corporation or other entity
controlled by such officer, employee, consultant, director or stockholder.
(w) Securities Act of 1933. The Company has complied and will comply
with all applicable federal and state securities laws in connection with the
offer, issuance and sale of the Shares, the Warrants and the Warrant Shares
hereunder. Neither the Company nor anyone acting on its behalf, directly or
indirectly, has or will sell, offer to sell or solicit offers to buy any of the
Securities, or similar securities to, or solicit offers with respect thereto
from, or enter into any preliminary conversations or negotiations relating
thereto with, any person, or has taken or will take any action so as to bring
the issuance and sale of any of the Securities under the registration provisions
of the Securities Act and applicable state securities laws. Neither the Company
nor any of its affiliates, nor any person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising (within the
meaning of Regulation D under the Securities Act) in connection with the offer
or sale of any of the Securities.
(x) Governmental Approvals. Except as set forth on Schedule 2.1(x)
hereto, and except for the filing of any notice prior or subsequent to the
Closing that may be required under applicable state and/or federal securities
laws (which if required, shall be filed on a timely basis), no authorization,
consent, approval, license, exemption of, filing or registration with any court
or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, is or will be necessary for, or in
connection with, the execution or delivery of the Shares and the Warrants, or
for the performance by the Company of its obligations under the Transaction
Documents.
(y) Employees. Neither the Company nor any Subsidiary has any
collective bargaining arrangements or agreements covering any of its employees.
Except as set forth in the Commission Documents or on Schedule 2.1(y) hereto,
neither the Company nor any Subsidiary has any employment contract, agreement
regarding proprietary information, non-competition agreement, non-solicitation
agreement, confidentiality agreement, or any other similar contract or
restrictive covenant, relating to the right of any officer, employee or
consultant to be employed or engaged by the Company or such Subsidiary. Since
June 30, 2003, no officer, consultant or key employee of the Company or any
Subsidiary whose termination, either individually or in the aggregate, could
have a Material Adverse Effect, has terminated or, to the knowledge of the
Company, has any present intention of terminating his or her employment or
engagement with the Company or any Subsidiary.
-10-
(z) Absence of Certain Developments. Except as set forth in the
Commission Documents or on Schedule 2.1(z) hereto, since June 30, 2003, neither
the Company nor any Subsidiary has:
(i) issued any stock, bonds or other corporate securities or any
rights, options or warrants with respect thereto;
(ii) borrowed any amount or incurred or become subject to any
liabilities (absolute or contingent) except current liabilities incurred in the
ordinary course of business which are comparable in nature and amount to the
current liabilities incurred in the ordinary course of business during the
comparable portion of its prior fiscal year, as adjusted to reflect the current
nature and volume of the Company's or such Subsidiary's business;
(iii) discharged or satisfied any lien or encumbrance or paid
any obligation or liability (absolute or contingent), other than current
liabilities paid in the ordinary course of business;
(iv) declared or made any payment or distribution of cash or
other property to stockholders with respect to its stock, or purchased or
redeemed, or made any agreements so to purchase or redeem, any shares of its
capital stock;
(v) sold, assigned or transferred any other tangible assets, or
canceled any debts or claims, except in the ordinary course of business;
(vi) sold, assigned or transferred any patent rights,
trademarks, trade names, copyrights, trade secrets or other intangible assets or
intellectual property rights, or disclosed any proprietary confidential
information to any person except in the ordinary course of business or to the
Purchasers or their representatives;
(vii) suffered any substantial losses or waived any rights of
material value, whether or not in the ordinary course of business, or suffered
the loss of any material amount of prospective business;
(viii) made any changes in employee compensation except in the
ordinary course of business and consistent with past practices;
(ix) made capital expenditures or commitments therefor that
aggregate in excess of $25,000;
(x) entered into any other transaction other than in the
ordinary course of business, or entered into any other material transaction,
whether or not in the ordinary course of business;
(xi) made charitable contributions or pledges in excess of
$25,000;
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(xii) suffered any material damage, destruction or casualty loss,
whether or not covered by insurance;
(xiii) experienced any material problems with labor or management
in connection with the terms and conditions of their employment;
(xiv) effected any two or more events of the foregoing kind which
in the aggregate would cause a Material Adverse Effect; or
(xv) entered into an agreement, written or otherwise, to take any
of the foregoing actions.
(aa) Use of Proceeds. All of the net proceeds (after deduction of all
commissions and other offering expenses) from the sale of the Shares and the
Warrants will be used by the Company to purchase shares of preferred stock of
Araios, Inc., a Delaware corporation.
(bb) Public Utility Holding Company Act and Investment Company Act
Status. The Company is not a "holding company" or a "public utility company" as
such terms are defined in the Public Utility Holding Company Act of 1935, as
amended. The Company is not, and as a result of and immediately upon Closing
will not be, an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
(cc) ERISA. No liability to the Pension Benefit Guaranty Corporation
has been incurred with respect to any Plan by the Company or any of its
Subsidiaries which is or would cause a Material Adverse Effect. The execution
and delivery of this Agreement and the issue and sale of the Shares and the
Warrants will not involve any transaction which is subject to the prohibitions
of Section 406 of ERISA or in connection with which a tax could be imposed
pursuant to Section 4975 of the Internal Revenue Code of 1986, as amended (the
"Code"); provided that, if any Purchaser, or any person or entity that owns a
beneficial interest in any Purchaser, is an "employee pension benefit plan"
(within the meaning of Section 3(2) of ERISA) with respect to which the Company
is a "party in interest" (within the meaning of Section 3(14) of ERISA), the
requirements of Sections 407(d)(5) and 408(e) of ERISA, if applicable, are met.
As used in this Section 2.1(cc), the term "Plan" shall mean an "employee pension
benefit plan" (as defined in Section 3 of ERISA) which is or has been
established or maintained, or to which contributions are or have been made, by
the Company or any Subsidiary or by any trade or business, whether or not
incorporated, which, together with the Company or any Subsidiary, is under
common control, as described in Section 414(b) or (c) of the Code.
(dd) Delisting Notification. The Company has not received a delisting
notification from the NASDAQ Stock Market that has not been rescinded, and, to
its knowledge, there are no existing facts or circumstances that could give rise
to the delisting of the Common Stock from the NASDAQ Stock Market.
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(ee) Xxxxxxxx-Xxxxx Act. The Company is in compliance with any and all
applicable requirements of the Xxxxxxxx-Xxxxx Act of 2002 that are effective as
of the date hereof, and any and all applicable rules and regulations promulgated
by the Commission thereunder that are effective as of the date hereof, except
where such noncompliance would not have, individually or in the aggregate, a
Material Adverse Effect.
Section 2.2 Representations and Warranties of the Purchasers. Each of
the Purchasers hereby makes the following representations and warranties to the
Company with respect solely to itself and not with respect to any other
Purchaser:
(a) Organization and Standing of the Purchasers. If such Purchaser is
an entity, such Purchaser is a corporation, limited liability company or
partnership duly incorporated or organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization.
(b) Authorization and Power. Such Purchaser has the requisite power and
authority to enter into and perform the Transaction Documents and to purchase
the Shares and Warrants being sold to it hereunder. The execution, delivery and
performance of the Transaction Documents by such Purchaser and the consummation
by it of the transactions contemplated hereby have been duly authorized by all
necessary corporate or partnership action, and no further consent or
authorization of such Purchaser or its Board of Directors, stockholders, or
partners, as the case may be, is required. This Agreement has been duly
authorized, executed and delivered by such Purchaser. The other Transaction
Documents constitute, or shall constitute when executed and delivered, valid and
binding obligations of such Purchaser enforceable against such Purchaser in
accordance with their terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditor's rights and remedies or by other
equitable principles of general application.
(c) Acquisition for Investment. Such Purchaser is purchasing the Shares
and acquiring the Warrants solely for its own account for the purpose of
investment and not with a view to or for sale in connection with the
distribution thereof. Such Purchaser does not have a present intention to sell
any of the Securities, nor a present arrangement (whether or not legally
binding) or intention to effect any distribution of any of the Securities to or
through any person or entity; provided, however, that by making the
representations herein and subject to Section 2.2(e) below, such Purchaser does
not agree to hold any of the Securities for any minimum or other specific term
and reserves the right to pledge any of the Securities for margin purposes
and/or to dispose of any of the Securities at any time in accordance with
federal and state securities laws applicable to such disposition. Such Purchaser
acknowledges that it (i) has such knowledge and experience in financial and
business matters such that such Purchaser is capable of evaluating the merits
and risks of its investment in the Company, (ii) is able to bear the financial
risks associated with an investment in the Securities, and (iii) has been given
full access to such records of the Company and the Subsidiaries and to the
officers of the Company and the Subsidiaries as it has deemed necessary or
appropriate to conduct its due diligence investigation.
-13-
(d) Rule 144. Such Purchaser understands that the Securities must be
held indefinitely unless such Securities are registered under the Securities Act
or an exemption from registration is available. Such Purchaser acknowledges that
it is familiar with Rule 144 of the rules and regulations of the Commission, as
amended, promulgated pursuant to the Securities Act ("Rule 144"), and that such
Purchaser has been advised that Rule 144 permits resales only under certain
circumstances. Such Purchaser understands that to the extent that Rule 144 is
not available, such Purchaser will be unable to sell any Securities without
either registration under the Securities Act or the existence of another
exemption from such registration requirement.
(e) General. Such Purchaser understands that the Securities are being
offered and sold in reliance on a transactional exemption from the registration
requirements of federal and state securities laws and the Company is relying
upon the truth and accuracy of the representations, warranties, agreements,
acknowledgments and understandings of such Purchaser set forth herein in order
to determine the applicability of such exemptions and the suitability of such
Purchaser to acquire the Securities. Such Purchaser understands that no United
States federal or state agency or any government or governmental agency has
passed upon or made any recommendation or endorsement of the Securities.
(f) Opportunities for Additional Information. Such Purchaser
acknowledges that such Purchaser has had the opportunity to ask questions of and
receive answers from, or obtain additional information from, the executive
officers of the Company concerning the financial and other affairs of the
Company, and to the extent deemed necessary in light of such Purchaser's
personal knowledge of the Company's affairs, such Purchaser has asked such
questions and received answers to the full satisfaction of such Purchaser, and
such Purchaser desires to invest in the Company.
(g) No General Solicitation. Such Purchaser acknowledges that the
Securities were not offered to such Purchaser by means of any form of general or
public solicitation or general advertising, or publicly disseminated
advertisements or sales literature, including (i) any advertisement, article,
notice or other communication published in any newspaper, magazine, or similar
media, or broadcast over television or radio, or (ii) any seminar or meeting to
which such Purchaser was invited by any of the foregoing means of
communications.
(h) Accredited Investor. Such Purchaser is an accredited investor (as
defined in Rule 501 of Regulation D), and such Purchaser has such experience in
business and financial matters that it is capable of evaluating the merits and
risks of an investment in the Securities. Such Purchaser acknowledges that an
investment in the Securities is speculative and involves a high degree of risk.
ARTICLE III
COVENANTS
The Company covenants with each Purchaser as follows, which covenants
are for the benefit of each Purchaser and their respective permitted assignees.
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Section 3.1 Securities Compliance. The Company shall notify the
Commission, in accordance with its rules and regulations, of the transactions
contemplated by any of the Transaction Documents, and shall take all other
necessary action and proceedings as may be required and permitted by applicable
law, rule and regulation, for the legal and valid issuance of the Securities to
the Purchasers, or their respective subsequent holders.
Section 3.2 Registration and Listing. The Company will cause its
Common Stock to continue to be registered under Section 12(b) or 12(g) of the
Exchange Act, will comply in all respects with its reporting and filing
obligations under the Exchange Act, will comply with all requirements related to
any registration statement filed pursuant to this Agreement, and will not take
any action or file any document (whether or not permitted by the Securities Act
or the rules promulgated thereunder) to terminate or suspend such registration
or to terminate or suspend its reporting and filing obligations under the
Exchange Act or Securities Act, except as permitted herein. The Company shall
use its commercially reasonable best efforts to continue the quotation of its
Common Stock on the NASDAQ Stock Market or any successor market. The Company
will promptly file the "Listing Application" for, or in connection with, the
issuance and delivery of the Shares and the Warrant Shares.
Section 3.3 Inspection Rights. In the event the Registration
Statement (as defined in the Registration Rights Agreement) is not effective or
has been suspended at any time that such Registration Statement is required to
be in effect, the Company shall, during normal business hours and upon
reasonable request and reasonable notice, permit a Purchaser or any employees,
agents or representatives thereof, so long as the Purchaser shall beneficially
own the Shares, Warrant Shares or the Warrants which, in the aggregate,
represent more than two percent (2%) of the total combined voting power of all
voting securities then outstanding, to examine and make reasonable copies of and
extracts from the records and books of account of, and visit and inspect the
properties, assets, operations and business of the Company and any Subsidiary,
and to discuss the affairs, finances and accounts of the Company and any
Subsidiary with any of its officers, consultants, directors, and key employees.
Section 3.4 Compliance with Laws. The Company shall comply, and
cause each Subsidiary to comply, with all applicable laws, rules, regulations
and orders, the noncompliance with which could have a Material Adverse Effect.
Section 3.5 Keeping of Records and Books of Account. The Company
shall keep and cause each Subsidiary to keep adequate records and books of
account, in which complete entries will be made in accordance with GAAP
consistently applied, reflecting all financial transactions of the Company and
its Subsidiaries, and in which, for each fiscal year, all proper reserves for
depreciation, depletion, obsolescence, amortization, taxes, bad debts and other
purposes in connection with its business shall be made.
Section 3.6 Reporting Requirements. The Company shall furnish two
(2) copies of the following to each Purchaser in a timely manner so long as that
Purchaser shall be obligated hereunder to purchase the Shares or shall
beneficially own the Shares or Warrants, or shall own Warrant Shares which, in
the aggregate, represent more than one percent (1%) of the total combined voting
power of all voting securities then outstanding:
-15-
(a) Quarterly Reports filed with the Commission on Form 10-Q as soon
as available, and in any event within forty-five (45) days after the end of each
of the first three (3) fiscal quarters of the Company, but in no event prior to
the time that such Reports are publicly filed with the Commission or otherwise
made publicly available;
(b) Annual Reports filed with the Commission on Form 10-K as soon as
available, and in any event within ninety (90) days after the end of each fiscal
year of the Company, but in no event prior to the time that such Reports are
publicly filed with the Commission or otherwise made publicly available; and
(c) Copies of all notices and information, including without
limitation notices and proxy statements in connection with any meetings, that
are provided to holders of shares of Common Stock, contemporaneously with the
delivery of such notices or information to such holders of Common Stock.
Section 3.7 Other Agreements. The Company shall not enter into any
agreement in which the terms of such agreement would restrict or impair the
right or ability of the Company or any Subsidiary to perform under any
Transaction Document.
Section 3.8 Reservation of Shares. So long as the Warrants remain
outstanding, the Company shall take all action necessary to at all times have
authorized, and reserved for the purpose of issuance, the maximum number of
shares of Common Stock to effect the exercise of the Warrants.
Section 3.9 Disclosure of Transactions and Other Material
Information. On or before 8:30 a.m., New York City time, on the Business Day
immediately following the Closing Date, the Company shall file a Current Report
on Form 8-K (including all attachments, the "8-K Filing") with the Commission
(i) describing the terms of the transactions contemplated by the Transaction
Documents and including as exhibits to such Current Report on Form 8-K this
Agreement, the Warrants and the Registration Rights Agreement, and the schedules
hereto and thereto in the form required by the Exchange Act, and (ii) disclosing
the Company's investment in Araios, Inc. As of the time of the filing of the 8-K
Filing with the Commission, no Purchaser shall be in possession of any material,
nonpublic information received from the Company, any of its Subsidiaries or any
of their respective officers, directors, employees or agents, that is not
disclosed in the 8-K Filing. The Company shall not, and shall cause each of its
Subsidiaries and its and each of their respective officers, directors, employees
and agents not to, provide any Purchaser with any material, nonpublic
information regarding the Company or any of its Subsidiaries from and after the
filing of the 8-K Filing with the Company without the express written consent of
such Purchaser. Subject to the foregoing, neither the Company nor any Purchaser
shall issue any press releases or any other public statements with respect to
the transactions contemplated hereby; provided, however, that the Company shall
be entitled, without the prior approval of any Purchaser, to make any press
release or other public disclosure with respect to such transactions (i) in
substantial conformity with the 8-K Filing and contemporaneously therewith, and
(ii) as is required by applicable law and regulations, including the applicable
rules and regulations of the NASDAQ National Market or NASDAQ Small Cap Market
(provided that in the case of clause (i) above, each Purchaser shall be notified
by the
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Company (although the consent of such Purchaser shall not be required) in
connection with any such press release or other public disclosure prior to its
release).
Section 3.10 Delivery of Share Certificates. At Closing or as soon
thereafter as reasonably possible (but in any event no later than three Business
Days immediately following the Closing Date), the Company shall deliver to each
Purchaser certificates representing the Shares (in such denominations as each
Purchaser may request) acquired by such Purchaser at the Closing.
Section 3.11 No Trading in the Common Stock. From the date hereof
until the Closing, no Purchaser shall purchase, sell, sell short (or enter into
any other similar hedging transaction with respect to), or otherwise effect any
transaction in any shares of the Company's Common Stock.
ARTICLE IV
CONDITIONS
Section 4.1 Conditions Precedent to the Obligation of the Company to
Close and to Sell the Shares and Warrants. The obligation hereunder of the
Company to close and issue and sell the Shares and the Warrants to the
Purchasers on the Closing Date is subject to the satisfaction or waiver, at or
before the Closing, of the conditions set forth below. These conditions are for
the Company's sole benefit and may be waived by the Company at any time in its
sole discretion.
(a) Accuracy of the Purchasers' Representations and Warranties. The
representations and warranties of each Purchaser shall be true and correct in
all material respects as of the date when made and as of the Closing Date as
though made at that time, except for representations and warranties that are
expressly made as of a particular date, which shall be true and correct in all
material respects as of such date.
(b) Performance by the Purchasers. Each Purchaser shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Purchasers at or prior to the Closing Date.
(c) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
(d) Delivery of Purchase Price. The Purchase Price for the Shares
and Warrants shall have been delivered to the Company at the Closing.
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(e) Delivery of Transaction Documents. The Transaction Documents to
which the Purchasers are party shall have been duly executed and delivered by
the Purchasers to the Company.
Section 4.2 Conditions Precedent to the Obligation of the Purchasers
to Close and to Purchase the Shares and Warrants. The obligation hereunder of
the Purchasers to purchase the Shares and Warrants and consummate the
transactions contemplated by this Agreement is subject to the satisfaction or
waiver, at or before the Closing, of each of the conditions set forth below.
These conditions are for the Purchasers' sole benefit and may be waived by the
Purchasers at any time in their sole discretion.
(a) Accuracy of the Company's Representations and Warranties. Each
of the representations and warranties of the Company in this Agreement, the
Warrants and the Registration Rights Agreement shall be true and correct in all
material respects as of the Closing Date, except for representations and
warranties that speak as of a particular date, which shall be true and correct
in all material respects as of such date.
(b) Performance by the Company. The Company shall have performed,
satisfied and complied in all respects with all covenants, agreements and
conditions required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to the Closing Date.
(c) No Suspension, Etc. Trading in the Common Stock shall not have
been suspended by the Commission (except for any suspension of trading of
limited duration agreed to by the Company, which suspension shall be terminated
prior to the Closing), and, at any time prior to the Closing Date, trading in
securities generally as reported by Bloomberg Financial Markets ("Bloomberg")
shall not have been suspended or limited, or minimum prices shall not have been
established on securities whose trades are reported by Bloomberg, or quoted by
NASDAQ, nor shall a banking moratorium have been declared either by the United
States or California State authorities, nor shall there have occurred any
national or international calamity or crisis of such magnitude in its effect on
any financial market which, in each case, in the reasonable judgment of the
Purchasers, makes it impracticable or inadvisable to purchase the Shares.
(d) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
(e) No Proceedings or Litigation. No action, suit or proceeding
before any arbitrator or any governmental authority shall have been commenced,
and no investigation by any governmental authority shall have been threatened,
against the Company or any Subsidiary, or any of the officers, directors or
affiliates of the Company or any Subsidiary, seeking to restrain, prevent or
change the transactions contemplated by this Agreement, or seeking damages in
connection with such transactions.
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(f) Opinion of Counsel, Etc. The Purchasers shall have received an
opinion of counsel to the Company, dated the Closing Date, in the form of
Exhibit C hereto, and such other certificates and documents as the Purchasers or
their counsel shall reasonably require incident to the Closing.
(g) Warrants. The Company shall have delivered to the Purchasers the
originally executed Warrants (in such denominations as each Purchaser may
request) being acquired by the Purchasers at the Closing.
(h) Resolutions. The Board of Directors of the Company shall have
adopted resolutions consistent with Section 2.1(b) hereof in a form reasonably
acceptable to the Purchasers (the "Resolutions").
(i) Reservation of Shares. As of the Closing Date, the Company shall
have reserved out of its authorized and unissued Common Stock, solely for the
purpose of effecting the issuance of the Shares and the exercise of the
Warrants, a number of shares of Common Stock equal to the number of Warrant
Shares issuable upon exercise of the Warrants.
(j) Secretary's Certificate. The Company shall have delivered to the
Purchasers a secretary's certificate, dated as of the Closing Date, as to (i)
the Resolutions, (ii) the Certificate and the Bylaws, each as in effect at the
Closing, and (iii) the authority and incumbency of the officers of the Company
executing the Transaction Documents and any other documents required to be
executed or delivered in connection therewith.
(k) Officer's Certificate. On the Closing Date, the Company shall
have delivered to the Purchasers a certificate of an executive officer of the
Company, dated as of the Closing Date, confirming the accuracy of the Company's
representations, warranties and covenants as of the Closing Date and confirming
the compliance by the Company with the conditions precedent set forth in this
Section 4.2 as of the Closing Date.
(l) Fees and Expenses. As of the Closing Date, all fees and expenses
required to be paid by the Company shall have been or authorized to be paid by
the Company as of the Closing Date.
(m) Registration Rights Agreement. As of the Closing Date, the
parties shall have entered into the Registration Rights Agreement in the Form of
Exhibit D attached hereto.
(n) Material Adverse Effect. No Material Adverse Effect shall have
occurred.
(o) Araios, Inc. Share Purchase. The Company shall have entered into
a binding agreement with Araios, Inc. to purchase shares of Araios, Inc.
preferred stock with the net proceeds of this offering.
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ARTICLE V
CERTIFICATE LEGEND
Section 5.1 Legend. Each certificate representing the Shares, the
Warrants and the Warrant Shares shall be stamped or otherwise imprinted with a
legend substantially in the following form (in addition to any legend required
by applicable state securities or "blue sky" laws):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE "SECURITIES") HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR CYTRX
CORPORATION SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT
REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE
PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.
The Company agrees to reissue certificates representing any of the
Securities, without the legend set forth above, if at such time, prior to making
any transfer of any such Securities, such holder thereof shall give written
notice to the Company describing the manner and terms of such transfer and
removal as the Company may reasonably request. Such proposed transfer and
removal of the legend will not be effected until: (a) the Company has notified
such holder that either (i) in the opinion of Company counsel, the registration
of the Shares, the Warrants or Warrant Shares under the Securities Act is not
required in connection with such proposed transfer, or (ii) a registration
statement under the Securities Act covering such proposed disposition has been
filed by the Company with the Commission and has become effective under the
Securities Act; and (b) the Company has notified such holder that either (i) in
the opinion of Company counsel, the registration or qualification under the
securities or "blue sky" laws of any state is not required in connection with
such proposed disposition, or (ii) compliance with applicable state securities
or "blue sky" laws has been effected. The Company will use its reasonable best
efforts to respond to any such notice from a holder within three (3) Business
Days. In the case of any proposed transfer under this Section 5.1, the Company
will use reasonable efforts to comply with any such applicable state securities
or "blue sky" laws, but shall in no event be required, in connection therewith,
to qualify to do business in any state where it is not then qualified or to take
any action that would subject it to tax or to the general service of process in
any state where it is not then subject. The restrictions on transfer contained
in this Section 5.1 shall be in addition to, and not by way of limitation of,
any other restrictions on transfer contained in any other section of this
Agreement. Notwithstanding the foregoing, the restrictions on transfer contained
in this Section 5.1 shall not be deemed to limit or prohibit any Purchaser's
right to pledge any of the Securities for margin purposes.
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ARTICLE VI
TERMINATION
Section 6.1 Termination by Mutual Consent. This Agreement may be
terminated at any time prior to the Closing Date by the mutual written consent
of the Company and the Purchasers.
Section 6.2 Effect of Termination. In the event of termination by
the Company or the Purchasers, written notice thereof shall forthwith be given
to the other party and the transactions contemplated by this Agreement shall be
terminated without further action by any party. If this Agreement is terminated
as provided in Section 6.1 herein, this Agreement shall become void and of no
further force and effect, except for Sections 8.1 and 8.2, and Article VII
herein. Nothing in this Section 6.2 shall be deemed to release the Company or
any Purchaser from any liability for any breach under this Agreement, or to
impair the rights of the Company or such Purchaser to compel specific
performance by the other party of its obligations under this Agreement.
ARTICLE VII
INDEMNIFICATION
Section 7.1 General Indemnity. The Company agrees to indemnify and
hold harmless each Purchaser (and its respective directors, officers, employees,
affiliates, agents, successors and assigns) from and against any and all losses,
liabilities, deficiencies, costs, damages and expenses (including, without
limitation, reasonable attorneys' fees, charges and disbursements) incurred by
each Purchaser or any such person as a result of any inaccuracy in or breach of
the representations, warranties or covenants made by the Company herein. The
Purchasers severally but not jointly agree to indemnify and hold harmless the
Company and its directors, officers, employees, affiliates, agents, successors
and assigns from and against any and all losses, liabilities, deficiencies,
costs, damages and expenses (including, without limitation, reasonable
attorneys' fees, charges and disbursements) incurred by the Company as result of
any inaccuracy in or breach of the representations, warranties or covenants made
by the Purchasers herein.
Section 7.2 Indemnification Procedure. Any party entitled to
indemnification under this Article VII (an "indemnified party") will give
written notice to the indemnifying party of any matters giving rise to a claim
for indemnification; provided, that the failure of any party entitled to
indemnification hereunder to give notice as provided herein shall not relieve
the indemnifying party of its obligations under this Article VII except to the
extent that the indemnifying party is actually prejudiced by such failure to
give notice. In case any action, proceeding or claim is brought against an
indemnified party in respect of which indemnification is sought hereunder, the
indemnifying party shall be entitled to participate in and, unless in the
reasonable judgment of the indemnified party a conflict of interest between it
and the indemnifying party may exist with respect to such action, proceeding or
claim, to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. In the event that
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the indemnifying party advises an indemnified party that it will contest such a
claim for indemnification hereunder, or fails, within thirty (30) days of
receipt of any indemnification notice to notify, in writing, such person of its
election to defend, settle or compromise, at its sole cost and expense, any
action, proceeding or claim (or discontinues its defense at any time after it
commences such defense), then the indemnified party may, at its option, defend,
settle or otherwise compromise or pay such action or claim. In any event, unless
and until the indemnifying party elects in writing to assume and does so assume
the defense of any such claim, proceeding or action, the indemnified party's
costs and expenses arising out of the defense, settlement or compromise of any
such action, claim or proceeding shall be losses subject to indemnification
hereunder. The indemnified party shall cooperate fully with the indemnifying
party in connection with any negotiation or defense of any such action or claim
by the indemnifying party and shall furnish to the indemnifying party all
information reasonably available to the indemnified party which relates to such
action or claim. The indemnifying party shall keep the indemnified party fully
apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. If the indemnifying party elects to defend
any such action or claim, then the indemnified party shall be entitled to
participate in such defense with counsel of its choice at its sole cost and
expense. The indemnifying party shall not be liable for any settlement of any
action, claim or proceeding effected without its prior written consent.
Notwithstanding anything in this Article VII to the contrary, the indemnifying
party shall not, without the indemnified party's prior written consent, settle
or compromise any claim or consent to entry of any judgment in respect thereof
which imposes any future obligation on the indemnified party or which does not
include, as an unconditional term thereof, the giving by the claimant or the
plaintiff to the indemnified party of a release from all liability in respect of
such claim. The indemnification required by this Article VII shall be made by
periodic payments of the amount thereof during the course of investigation or
defense, as and when bills are received or expense, loss, damage or liability is
incurred, so long as the indemnified party irrevocably agrees to refund such
moneys if it is ultimately determined by a court of competent jurisdiction that
such party was not entitled to indemnification. The indemnity agreements
contained herein shall be in addition to (a) any cause of action or similar
rights of the indemnified party against the indemnifying party or others, and
(b) any liabilities the indemnifying party may be subject to pursuant to the
law.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Fees and Expenses. Each party shall pay the fees and
expenses of its advisors, counsel, accountants and other experts, if any, and
all other expenses, incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement; provided,
however, that the Company shall pay all fees and expenses (including attorneys'
fees and expenses) incurred by the Purchasers in connection with the
preparation, negotiation, execution, delivery and performance of this Agreement
and the other Transaction Documents and the transactions contemplated thereunder
up to an aggregate maximum of $15,000, regardless of whether or not the Closing
occurs (unless the failure of the Closing to occur is a result of a breach by
any Purchaser of this Agreement, in which event the Company shall not be
required to pay any of such fees or expenses). In addition, the Company
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shall pay all reasonable fees and expenses incurred by the Purchasers in
connection with any amendments, modifications or waivers of this Agreement or
any of the other Transaction Documents or incurred in connection with the
enforcement of this Agreement and any of the other Transaction Documents,
following a breach by the Company of this Agreement or any of the other
Transaction Documents, including, without limitation, all reasonable attorneys'
fees, disbursements and expenses.
Section 8.2 Specific Enforcement; Consent to Jurisdiction.
(a) The Company and the Purchasers acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement or the other Transaction Documents were not performed in accordance
with their specific terms or were otherwise breached. It is accordingly agreed
that the parties shall be entitled to an injunction or injunctions to prevent or
cure breaches of the provisions of this Agreement or the other Transaction
Documents and to enforce specifically the terms and provisions hereof or
thereof, this being in addition to any other remedy to which any of them may be
entitled by law or equity.
(b) The Company and each Purchaser (i) hereby irrevocably submit to
the non-exclusive jurisdiction of the United States District Court sitting in
the Central District of California and the courts of the State of California
located in the City of Los Angeles, for the purposes of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other
Transaction Documents or the transactions contemplated hereby or thereby, and
(ii) hereby waive, and agree not to assert in any such suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
such court, that the suit, action or proceeding is brought in an inconvenient
forum or that the venue of the suit, action or proceeding is improper. The
Company and each Purchaser consent to process being served in any such suit,
action or proceeding by mailing a copy thereof to such party at the address in
effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing in
this Section 8.2 shall affect or limit any right to serve process in any other
manner permitted by law. The Company and the Purchasers hereby agree that the
prevailing party in any suit, action or proceeding arising out of or relating to
the Shares, this Agreement, the Registration Rights Agreement or the Warrants,
shall be entitled to reimbursement for reasonable legal fees from the
non-prevailing party.
Section 8.3 Entire Agreement; Amendment. This Agreement and the
Transaction Documents contain the entire understanding and agreement of the
parties with respect to the matters covered hereby and, except as specifically
set forth herein or in the other Transaction Documents, neither the Company nor
any Purchaser make any representation, warranty, covenant or undertaking with
respect to such matters, and they supersede all prior understandings and
agreements with respect to said subject matter, all of which are merged herein.
No provision of this Agreement may be waived or amended other than by a written
instrument signed by the Company and the holders of at least a majority in
interest of the then-outstanding Shares, and no such amendment shall be
effective to the extent that it applies to less than all of the holders of the
Shares then outstanding. No consideration shall be offered or paid to any person
to amend or consent to a waiver or modification of any provision of any of the
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Transaction Documents unless the same consideration is also offered to all of
the parties to the Transaction Documents or holders of Shares, as the case may
be.
Section 8.4 Notices. Any notice, demand, request, waiver or other
communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand delivery by telecopy or facsimile at the
address or number designated below (if delivered on a business day during normal
business hours where such notice is to be received), or the first business day
following such delivery (if delivered other than on a business day during normal
business hours where such notice is to be received), or (b) on the second
business day following the date of mailing by express courier service, fully
prepaid, addressed to such address, or upon actual receipt of such mailing,
whichever shall first occur. The addresses for such communications shall be:
If to the Company: CytRx Corporation
00000 Xxx Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
with copies (which copies
shall not constitute notice
to the Company) to: Xxxx & Xxxxx Professional Corporation
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
If to any Purchaser: At the address of such Purchaser set forth
on Exhibit A to this Agreement.
Any party hereto may from time to time change its address for notices
by giving at least ten (10) days written notice of such changed address to the
other party hereto.
Section 8.5 Waivers. No waiver by any party of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
Section 8.6 Headings; Interpretation. The article, section and
subsection headings in this Agreement are for convenience only and shall not
constitute a part of this Agreement for any other purpose and shall not be
deemed to limit or affect any of the provisions hereof. The interpretation of
this Agreement shall not be affected by the party who drafted this Agreement,
and all parties waive any statute, legal decision, or common law principle that
would
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require interpretation of any ambiguities in this Agreement against the party
that drafted this Agreement.
Section 8.7 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties and their successors and assigns.
After the Closing, the assignment by a party to this Agreement of any rights
hereunder shall not affect the obligations of such party under this Agreement.
After the Closing, the Purchasers may assign the Shares, the Warrants and their
rights under this Agreement and the other Transaction Documents and any other
rights hereto and thereto without the consent of the Company, except as
otherwise required in this Agreement.
Section 8.8 No Third Party Beneficiaries. This Agreement is intended
for the benefit of the parties hereto and their respective permitted successors
and assigns and is not for the benefit of, nor may any provision hereof be
enforced by, any other person (other than indemnified parties, as contemplated
by Article VII).
Section 8.9 Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware, without
giving effect to the choice of law provisions. This Agreement shall not be
interpreted or construed with any presumption against the party causing this
Agreement to be drafted.
Section 8.10 Survival. The representations and warranties of the
Company and the Purchasers contained in Sections 2.1(o) and 2.1(s) shall survive
indefinitely and those contained in Article II, with the exception of Sections
2.1(o) and 2.1(s), shall survive the execution and delivery hereof and the
Closing until the date two (2) years from the Closing Date, and the agreements
and covenants set forth in Articles I, III, V, VII and VIII of this Agreement
shall survive the execution and delivery hereof and the Closing hereunder.
Section 8.11 Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and shall become effective when counterparts have been signed by
each party and delivered to the other parties hereto, it being understood that
all parties need not sign the same counterpart.
Section 8.12 Publicity. The Company agrees that it will not
disclose, and will not include in any public announcement, the names of the
Purchasers without the consent of the Purchasers in accordance with Section 8.3,
which consent shall not be unreasonably withheld or delayed, or unless and until
such disclosure is required by law, rule or applicable regulation, and then only
to the extent of such requirement.
Section 8.13 Severability. The provisions of this Agreement are
severable and, in the event that any court of competent jurisdiction shall
determine that any one or more of the provisions or part of the provisions
contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of
this Agreement and this Agreement shall be reformed and construed as if such
invalid or illegal or unenforceable provision, or part of such provision, had
never been contained herein, so that such provisions would be valid, legal and
enforceable to the maximum extent possible.
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Section 8.14 Further Assurances. From and after the date of this
Agreement, upon the request of the Purchasers or the Company, the Company and
each Purchaser shall execute and deliver such instruments, documents and other
writings as may be reasonably necessary or desirable to confirm and carry out
and to effectuate fully the intent and purposes of this Agreement, the Warrants
and the Registration Rights Agreement.
Section 8.15 Independent Nature of Purchasers' Obligations and
Rights. The obligations of each Purchaser under any Transaction Document are
several and not joint with the obligations of any other Purchaser, and no
Purchaser shall be responsible in any way for the performance of the obligations
of any other Purchaser under any Transaction Document. Nothing contained herein
or in any other Transaction Document, and no action taken by any Purchaser
pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert or as
a group with respect to such obligations or the transactions contemplated by the
Transaction Documents. Each Purchaser confirms that it has independently
participated in the negotiation of the transactions contemplated hereby with the
advice of its own counsel and advisors. Each Purchaser shall be entitled to
independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement or out of any other Transaction Documents,
and it shall not be necessary for any other Purchaser to be joined as an
additional party in any proceeding for such purpose.
[Remainder of page intentionally left blank. Signature pages to follow.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the date first above
written.
CYTRX CORPORATION
By:_____________________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Chief Executive Officer
[SIGNATURES OF PURCHASERS TO FOLLOW ON NEXT PAGES.]
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"PURCHASERS"
------------------------------
(PRINTED NAME OF PURCHASER)
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Purchase Price: $_____________
------------------------------
------------------------------
------------------------------
(Print address)
Telephone: ___________________
Facsimile:____________________
E-mail:_______________________
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EXHIBIT A
---------
LIST OF PURCHASERS
NAMES AND ADDRESSES NUMBER OF SHARES NUMBER OF WARRANTS DOLLAR AMOUNT
OF PURCHASERS PURCHASED PURCHASED OF PURCHASE PRICE
------------- --------- --------- -----------------
A-1
EXHIBIT B
---------
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SHARES ISSUABLE UPON THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED EXCEPT UPON
DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL SATISFACTORY IN FORM AND
SUBSTANCE TO IT THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT OF 1933,
AS AMENDED
THE TRANSFER OF THIS WARRANT IS RESTRICTED AS DESCRIBED HEREIN.
CytRx Corporation
Warrant for the Purchase of Shares of Common Stock,
par value $0.001 per Share
No. W-____ ______ Shares
Issuance Date: September 16, 2003
THIS CERTIFIES that, for value received, _____________, whose address is
_________________________ or its registered assigns (the "Holder"), is entitled
to subscribe for and purchase from CytRx Corporation, a Delaware corporation
(the "Company"), upon the terms and conditions set forth herein, ______ shares
of the Company's Common Stock, par value $0.001 per share ("Common Stock"), at a
price of $3.05 per share, subject to adjustment as provided herein (the
"Exercise Price"). As used herein the term "this Warrant" shall mean and include
this Warrant and any Common Stock or Warrants hereafter issued as a consequence
of the exercise or transfer of this Warrant in whole or in part.
The number of shares of Common Stock issuable upon exercise of the
Warrants (the "Warrant Shares") and the Exercise Price may be adjusted from time
to time as hereinafter set forth. The Warrant Shares are entitled to the
benefits, and subject to the obligations, set forth in the Registration Rights
Agreement among the Company, the Holder and certain other parties dated
concurrently herewith.
1. Exercise Price and Exercise Period. This Warrant may be exercised at
any time or from time to time during the period commencing on the Issuance Date
and ending at 5:00 P.M. Pacific time on September 14, 2008 (the "Exercise
Period").
2. Procedure for Exercise; Effect of Exercise.
(a) Cash Exercise. This Warrant may be exercised, in whole or in part, by
the Holder during normal business hours on any business day during the Exercise
Period by (i) the delivery to the Company of a duly executed Notice of Exercise
(in the form attached to this Agreement)
B-1
specifying the number of Warrant Shares to be purchased, (ii) delivery of
payment to the Company of the Exercise Price for the number of Warrant Shares
specified in the Notice of Exercise by cash, wire transfer of immediately
available funds to a bank account specified by the Company, or by certified or
bank cashier's check (the "Aggregate Exercise Price"), and (iii) the surrender
to a common carrier for overnight delivery to the Company, or as soon as
practicable following the date the holder of this Warrant delivers the Notice of
Exercise to the Company, of this Warrant (or an indemnification undertaking with
respect to this Warrant in the case of its loss, theft or destruction).
(b) Cashless Exercise. This Warrant may also be exercised by the Holder
through a cashless exercise, as described in this Section 2(b). This Warrant may
be exercised, in whole or in part, by (i) the delivery to the Company of a duly
executed Notice of Exercise specifying the number of Warrant Shares to be
applied to such exercise, and (ii) the surrender to a common carrier for
overnight delivery to the Company, or as soon as practicable following the date
the holder of this Warrant delivers the Notice of Exercise to the Company, of
this Warrant (or an indemnification undertaking with respect to this Warrant in
the case of its loss, theft or destruction). The number of shares of Common
Stock to be issued upon exercise of this Warrant pursuant to this Section 2(b)
shall equal the value of this Warrant (or the portion thereof being canceled)
computed as of the date of delivery of this Warrant to the Company using the
following formula:
X = Y(A-B)
------
A
Where:
X = the number of shares of Common Stock to be issued to
Holder under this Section 2(b);
Y = the number of Warrant Shares identified in the Notice of
Exercise as being applied to the subject exercise;
A = the Current Market Price on such date; and
B = the Exercise Price on such date
For purposes of this Section 2(b), Current Market Price shall have the
definition provided in Section 6(g).
The Company acknowledges and agrees that this Warrant was issued on the
date set forth at the end of this Warrant. Consequently, the Company
acknowledges and agrees that, if the Holder conducts a cashless exercise
pursuant to this Section 2(b), the period during which the Holder held this
Warrant may, for purposes of Rule 144 promulgated under the Securities Act of
1933, as amended (the "Securities Act"), as such rule is currently in effect, be
"tacked" to the period during which the Holder holds the Warrant Shares received
upon such cashless exercise.
Notwithstanding the foregoing, the Holder may conduct a cashless
exercise pursuant to
B-2
this Section 2(b) only after the first anniversary of the
Issuance Date, and then only in the event that a registration statement covering
the resale of the Warrant Shares is not then effective at the time that the
Holder wishes to conduct such cashless exercise.
(c) Effect of Exercise. Upon receipt by the Company of a Notice of
Exercise, together with proper payment of the Exercise Price, as provided in
this Section 2, the Company agrees that such Warrant Shares shall be deemed to
be issued to the Holder as the record holder of such Warrant Shares as of the
close of business on the date on which the Notice of Exercise has been delivered
and payment has been made for such Warrant Shares in accordance with this
Agreement and the Holder shall be deemed to be the holder of record of the
Warrant Shares, notwithstanding that the stock transfer books of the Company
shall then be closed or that certificates representing such Warrant Shares shall
not then be actually delivered to the Holder. On or before the fifth business
day following the date on which the Company has received each of the Notice of
Exercise, the Aggregate Exercise Price (or notice of a cashless exercise) and
this Warrant (or an indemnification undertaking with respect to this Warrant in
the case of its loss, theft or destruction) (the "Exercise Delivery Documents"),
the Company shall (X) issue and deliver to the address as specified in the
Notice of Exercise, a certificate, registered in the name of the holder of this
Warrant or its designee, for the number of shares of Common Stock to which the
holder of this Warrant is entitled pursuant to such exercise, or (Y) provided
that the Company's transfer agent (the "Transfer Agent") is participating in The
Depository Trust Company ("DTC") Fast Automated Securities Transfer Program,
upon the request of the Holder, credit such aggregate number of shares of Common
Stock to which the Holder of this Warrant is entitled pursuant to such exercise
to the Holder's or its designee's balance account with DTC through its Deposit
Withdrawal Agent Commission system. If this Warrant should be exercised in part
only, the Company shall, upon surrender of this Warrant for cancellation,
execute and deliver a new Warrant evidencing the right of the Holder to purchase
the balance of the Warrant Shares subject to purchase hereunder within five (5)
business days of receipt of the Warrant.
3. Registration of Warrants; Transfer of Warrants. Any Warrants issued
upon the transfer or exercise in part of this Warrant shall be numbered and
shall be registered in a Warrant Register as they are issued. The Company shall
be entitled to treat the registered holder of any Warrant on the Warrant
Register as the owner in fact thereof for all purposes and shall not be bound to
recognize any equitable or other claim to or interest in such Warrant on the
part of any other person, and shall not be liable for any registration or
transfer of Warrants which are registered or to be registered in the name of a
fiduciary or the nominee of a fiduciary unless made with the actual knowledge
that a fiduciary or nominee is committing a breach of trust in requesting such
registration or transfer, or with the knowledge of such facts that its
participation therein amounts to bad faith. This Warrant shall be transferable
only on the books of the Company upon delivery thereof duly endorsed by the
Holder or by its duly authorized attorney or representative, or accompanied by
proper evidence of succession, assignment, or authority to transfer. In all
cases of transfer by an attorney, executor, administrator, guardian, or other
legal representative, duly authenticated evidence of his or its authority shall
be produced. Upon any registration of transfer, the Company shall deliver a new
Warrant or Warrants to the person entitled thereto. This Warrant may be
exchanged, at the option of the Holder thereof, for another
B-3
Warrant, or other Warrants of different denominations, of like tenor and
representing in the aggregate the right to purchase a like number of Warrant
Shares, upon surrender to the Company or its duly authorized agent.
4. Restrictions on Transfer. (a) The Holder, as of the date of issuance
hereof, represents to the Company that such Holder is acquiring the Warrants for
its own account for investment purposes and not with a view to the distribution
thereof or of the Warrant Shares. Notwithstanding any provisions contained in
this Warrant to the contrary, this Warrant and the related Warrant Shares shall
not be transferable except pursuant to the proviso contained in the following
sentence or upon the conditions specified in this Section 4, which conditions
are intended, among other things, to insure compliance with the provisions of
the Securities Act and applicable state law in respect of the transfer of this
Warrant or such Warrant Shares. The Holder by acceptance of this Warrant agrees
that the Holder will not transfer this Warrant or the related Warrant Shares
prior to delivery to the Company of an opinion of the Holder's counsel (as such
opinion and such counsel are described in Section 4(b) hereof) or until
registration of such Warrant Shares under the Securities Act has become
effective or after a sale of such Warrant Shares has been consummated pursuant
to Rule 144 or Rule 144A under the Securities Act; provided, however, that the
Holder may freely transfer this Warrant or such Warrant Shares (without delivery
to the Company of an opinion of Counsel) (i) to one of its nominees, affiliates
or a nominee thereof, (ii) to a pension or profit-sharing fund established and
maintained for its employees or for the employees of any affiliate, (iii) from a
nominee to any of the aforementioned persons as beneficial owner of this Warrant
or such Warrant Shares, or (iv) to a qualified institutional buyer, so long as
such transfer is effected in compliance with Rule 144A under the Securities Act.
(b) The Holder, by its acceptance hereof, agrees that prior to any
transfer of this Warrant or of the related Warrant Shares (other than as
permitted by Section 4(a) hereof or pursuant to a registration under the
Securities Act), the Holder will give written notice to the Company of its
intention to effect such transfer, together with an opinion of such counsel for
the Holder as shall be reasonably acceptable to the Company, to the effect that
the proposed transfer of this Warrant and/or such Warrant Shares may be effected
without registration under the Securities Act. Upon delivery of such notice and
opinion to the Company, the Holder shall be entitled to transfer this Warrant
and/or such Warrant Shares in accordance with the intended method of disposition
specified in the notice to the Company.
(c) Each stock certificate representing Warrant Shares issued upon
exercise or exchange of this Warrant shall bear the following legend unless the
opinion of counsel referred to in Section 4(b) states such legend is not
required:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED
EXCEPT UPON DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL
SATISFACTORY IN FORM
B-4
AND SUBSTANCE TO IT THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT
OF 1933, AS AMENDED."
The Holder understands that the Company may place, and may instruct any transfer
agent or depository for the Warrant Shares to place, a stop transfer notation in
the securities records in respect of the Warrant Shares.
5. Reservation of Shares. The Company shall at all times during the
Exercise Period reserve and keep available out of its authorized and unissued
Common Stock, solely for the purpose of providing for the exercise of the rights
to purchase all Warrant Shares granted pursuant to the Warrants, such number of
shares of Common Stock as shall, from time to time, be sufficient therefor. The
Company covenants that all shares of Common Stock issuable upon exercise of this
Warrant, upon receipt by the Company of the full Exercise Price therefor, and
all shares of Common Stock issuable upon conversion of this Warrant, shall be
validly issued, fully paid, non-assessable, and free of preemptive rights.
6. Exercise Price Adjustments. The Exercise Price shall be subject to
adjustment from time to time as follows:
(a) (i) In the event that the Company shall (A) pay a dividend or
make a distribution, in shares of Common Stock, on any class of capital stock of
the Company or any subsidiary which is not directly or indirectly wholly owned
by the Company, (B) split or subdivide its outstanding Common Stock into a
greater number of shares, or (C) combine its outstanding Common Stock into a
smaller number of shares, then in each such case the Exercise Price in effect
immediately prior thereto shall be adjusted so that the Holder of a Warrant
thereafter surrendered for Exercise shall be entitled to receive the number of
shares of Common Stock that such Holder would have owned or have been entitled
to receive after the occurrence of any of the events described above had such
Warrant been exercised immediately prior to the occurrence of such event. An
adjustment made pursuant to this Section 6(a)(i) shall become effective
immediately after the close of business on the record date in the case of a
dividend or distribution (except as provided in Section 6(e) below) and shall
become effective immediately after the close of business on the effective date
in the case of such subdivision, split or combination, as the case may be. Any
shares of Common Stock issuable in payment of a dividend shall be deemed to have
been issued immediately prior to the close of business on the record date for
such dividend for purposes of calculating the number of outstanding shares of
Common Stock under clauses (ii) and (iii) below.
(ii) In the event that the Company shall commit to issue or
distribute Common Stock or issue rights, warrants, options or convertible or
exchangeable securities entitling the holder thereof to subscribe for or
purchase, convert into or exchange for Common Stock, in any such case at a price
per share less than the Current Market Price per share on the earliest of (i)
the date the Company shall enter into a firm contract for such issuance or
distribution, (ii) the record date for the determination of stockholders
entitled to receive any such rights, warrants, options or convertible or
exchangeable securities, if applicable, or (iii) the date of
B-5
actual issuance or distribution of any such Common Stock or rights, warrants,
options or convertible or exchangeable securities (provided that the issuance of
Common Stock upon the exercise of rights, warrants, options or convertible or
exchangeable securities will not cause an adjustment in the Exercise Price if no
such adjustment would have been required at the time such right, warrant, option
or convertible or exchangeable security was issued), then the Exercise Price in
effect immediately prior to such earliest date shall be adjusted so that the
Exercise Price shall equal the price determined by multiplying the Exercise
Price in effect immediately prior to such earliest date by the fraction:
(x) whose numerator shall be the number of shares of Common Stock
outstanding on such date plus the number of shares which the
aggregate offering price of the total number of shares so offered
would purchase at such Current Market Price (such amount, with
respect to any such rights, warrants, options or convertible or
exchangeable securities, determined by multiplying the total
number of shares subject thereto by the exercise price of such
rights, warrants, options or convertible or exchangeable
securities and dividing the product so obtained by the Current
Market Price), and
(y) whose denominator shall be the number of shares of Common
Stock outstanding on such date plus the number of additional
shares of Common Stock to be issued or distributed or receivable
upon exercise of any such right, warrant, option or convertible or
exchangeable security.
Such adjustment shall be made successively whenever any such Common Stock,
rights, warrants, options or convertible or exchangeable securities are issued
or distributed. In determining whether any rights, warrants or options entitle
the holders to subscribe for or purchase shares of Common Stock at less than
such Current Market Price, and in determining the aggregate offering price of
shares of Common Stock so issued or distributed, there shall be taken into
account any consideration received by the Company for such Common Stock, rights,
warrants, options, or convertible or exchangeable securities, the value of such
consideration, if other than cash, to be determined by the Board of Directors,
whose determination shall be conclusive and described in a certificate filed
with the records of corporate proceedings of the Company. If any right, warrant,
option or convertible or exchangeable security to purchase or acquire Common
Stock, the issuance of which resulted in an adjustment in the Exercise Price
pursuant to this subsection (ii) shall expire and shall not have been exercised,
the Exercise Price shall immediately upon such expiration be recomputed to the
Exercise Price which would have been in effect had the adjustment of the
Exercise Price made upon the issuance of such right, warrant, option or
convertible or exchangeable security been made on the basis of offering for
subscription, purchase or issuance, as the case may be, only of that number of
shares of Common Stock actually purchased or issued upon the actual exercise of
such right, warrant, option or convertible or exchangeable securities.
(iii) No adjustment in the Exercise Price shall be required unless
the adjustment would require an increase or decrease of at least 1% in the
Exercise Price then in
B-6
effect; provided, however, that any adjustments that by reason of this Section
6(a) are not required to be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this Section 6(a) shall be
made to the nearest cent or nearest 1/100th of a share.
(iv) Notwithstanding anything to the contrary set forth in this
Section 6(a), no adjustment shall be made to the Exercise Price upon (A) the
issuance of shares of Common Stock pursuant to any compensation or incentive
plan for officers, directors, employees or consultants of the Company which plan
has been approved by the Compensation Committee of the Board of Directors (or,
if there is no such committee then serving, by the majority vote of the
Directors then serving each of which Director is not (x) an employee or officer
of the Company, (y) a 5% or greater stockholder of the Company, or (y) an
officer, employee, affiliate or associate of any such 5% or greater stockholder)
(unless the exercise price thereof is changed after the date hereof other than
solely by operation of the anti-dilution provisions thereof or by the
Compensation Committee of the Board of Directors or, if applicable, the Board of
Directors and, if required by law, the stockholders of the Company), or (B) the
issuance of Common Stock upon the conversion or exercise of the options,
warrants or rights of the Company outstanding on September 15, 2003, unless the
conversion or exercise price thereof is changed after September 15, 2003 (other
than solely by operation of the anti-dilution provisions thereof).
(v) The Company from time to time may reduce the Exercise Price by
any amount for any period of time in the discretion of the Board of Directors;
provided, however, that if the Company so reduces the Exercise Price, then it
shall similarly reduce the exercise price of all other warrants sold and issued
to other holders pursuant to that certain Securities Purchase Agreement dated as
of September 15, 2003, by and among the Company, the Holder and certain other
holders. A voluntary reduction of the Exercise Price does not change or adjust
the Exercise Price otherwise in effect for purposes of this Section 6(a).
(vi) In the event that, at any time as a result of an adjustment
made pursuant to Sections 6(a)(i) through 6(a)(iii) above, the Holder of any
Warrant thereafter surrendered for exercise shall become entitled to receive any
shares of the Company other than shares of the Common Stock, thereafter the
number of such other shares so receivable upon exercise of any such Warrant
shall be subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the Common
Stock contained in Sections 6(a)(i) through 6(a)(v) above, and the other
provisions of this Section 6(a) with respect to the Common Stock shall apply on
like terms to any such other shares.
(b) In case of any reclassification of the Common Stock (other than in a
transaction to which Section 6(a)(i) applies), any consolidation of the Company
with, or merger of the Company into, any other entity, any merger of another
entity into the Company (other than a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock of the Company), any sale or transfer of all or substantially all
of the assets of the Company or any compulsory share exchange, pursuant to which
share exchange the Common Stock is converted into other securities, cash or
other
B-7
property, then lawful provision shall be made as part of the terms of such
transaction whereby the Holder of a Warrant then outstanding shall have the
right thereafter, during the period such Warrant shall be exercisable, to
exercise such Warrant only for the kind and amount of securities, cash and other
property receivable upon the reclassification, consolidation, merger, sale,
transfer or share exchange by a holder of the number of shares of Common Stock
of the Company into which a Warrant might have been able to exercise for
immediately prior to the reclassification, consolidation, merger, sale, transfer
or share exchange assuming that such holder of Common Stock failed to exercise
rights of election, if any, as to the kind or amount of securities, cash or
other property receivable upon consummation of such transaction subject to
adjustment as provided in Section 6(a) above following the date of consummation
of such transaction. The Company shall not effect any such reclassification,
consolidation, merger, sale, transfer, share exchange or other disposition
unless prior to or simultaneously with the consummation thereof the successor
corporation (if other than the Company) resulting from such consolidation or
merger, or the corporation purchasing or otherwise acquiring such assets or
other appropriate corporation or entity shall assume, by written instrument
executed and delivered to the Holder, the obligation to deliver to the Holder
upon its exercise of the Warrant such shares of stock, securities or assets as,
in accordance with the foregoing provisions, the Holder may be entitled to
purchase and the other obligations under this Warrant. Notwithstanding the
foregoing, in the case of any sale or transfer of all or substantially all of
the assets of the Company or merger or consideration of the Company in which the
shareholders of the Company receive cash or other property for each of their
shares of Common Stock in excess of the then Exercise Price, this Warrant will
terminate if not exercised by the Holder no later than the closing of such sale,
merger or consolidation. The provisions of this Section 6(b) shall similarly
apply to successive reclassifications, consolidations, mergers, sales, transfers
or share exchanges.
(c) If:
(i) the Company shall take any action which would require an
adjustment in the Exercise Price pursuant to Section
6(a); or
(ii) the Company shall authorize the granting to the holders
of its Common Stock generally of rights, warrants or
options to subscribe for or purchase any shares of any
class or any other rights, warrants or options; or
(iii) there shall be any reclassification or change of the
Common Stock (other than a subdivision or combination of
its outstanding Common Stock or a change in par value)
or any consolidation, merger or statutory share exchange
to which the Company is a party and for which approval
of any stockholders of the Company is required, or the
sale or transfer of all or substantially all of the
assets of the Company; or
B-8
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in each such case, the Company shall cause to be filed with the transfer
agent for the Warrants and shall cause to be mailed to each Holder at such
Holder's address as shown on the books of the transfer agent for the Warrants,
as promptly as possible, but at least 30 days prior to the applicable date
hereinafter specified, a notice stating (A) the date on which a record is to be
taken for the purpose of such dividend, distribution or granting of rights,
warrants or options, or, if a record is not to be taken, the date as of which
the holders of Common Stock of record to be entitled to such dividend,
distribution or rights, warrants or options are to be determined, or (B) the
date on which such reclassification, change, consolidation, merger, statutory
share exchange, sale, transfer, dissolution, liquidation or winding-up is
expected to become effective or occur, and the date as of which it is expected
that holders of Common Stock of record shall be entitled to exchange their
shares of Common Stock for securities or other property deliverable upon such
reclassification, change, consolidation, merger, statutory share exchange, sale,
transfer, dissolution, liquidation or winding up. Failure to give such notice or
any defect therein shall not affect the legality or validity of the proceedings
described in this Section 6(c).
(d) Whenever the Exercise Price is adjusted as herein provided, the
Company shall promptly file with the transfer agent for the Warrants a
certificate of an officer of the Company setting forth the Exercise Price after
the adjustment and setting forth a brief statement of the facts requiring such
adjustment and a computation thereof. The Company shall promptly cause a notice
of the adjusted Exercise Price to be mailed to each Holder.
(e) In any case in which Section 6(a) provides that an adjustment
shall become effective immediately after a record date for an event and the date
fixed for such adjustment pursuant to Section 6(a) occurs after such record date
but before the occurrence of such event, the Company may defer until the actual
occurrence of such event (i) issuing to the Holder of any Warrants exercised
after such record date and before the occurrence of such event the additional
shares of Common Stock issuable upon such conversion by reason of the adjustment
required by such event over and above the Common Stock issuable upon such
exercise before giving effect to such adjustment, and (ii) paying to such holder
any amount in cash in lieu of any fraction pursuant to Section 6(i).
(f) In case the Company shall take any action affecting the Common
Stock, other than actions described in this Section 6, which in the opinion of
the Board of Directors would materially adversely affect the exercise right of
the Holders, the Exercise Price may be adjusted, to the extent permitted by law,
in such manner, if any, and at such time, as the Board of Directors may
determine to be equitable in the circumstances; provided, however, that in no
event shall the Board of Directors be required to take any such action.
(g) For the purpose of any computation under Section 2(b) or this
Section 6, the "Current Market Price" per share of Common Stock on any day shall
mean: (i) if the principal trading market for such securities is a national or
regional securities exchange,
B-9
the closing price on such exchange on such day; or (ii) if sales prices for
shares of Common Stock are reported by the NASDAQ National Market System or
NASDAQ Small Cap Market (or a similar system then in use), the last reported
sales price (regular way) so reported on such day; or (iii) if neither (i) nor
(ii) above are applicable, and if bid and ask prices for shares of Common Stock
are reported in the over-the-counter market by NASDAQ (or, if not so reported,
by the National Quotation Bureau), the average of the high bid and low ask
prices so reported on such day. Notwithstanding the foregoing, if there is no
reported closing price, last reported sales price, or bid and ask prices, as the
case may be, for the day in question, then the Current Market Price shall be
determined as of the latest date prior to such day for which such closing price,
last reported sales price, or bid and ask prices, as the case may be, are
available, unless such securities have not been traded on an exchange or in the
over-the-counter market for 30 or more days immediately prior to the day in
question, in which case the Current Market Price shall be determined in good
faith by, and reflected in a formal resolution of, the Board of Directors of the
Company.
(h) Upon each adjustment of the Exercise Price, this Warrant shall
thereafter evidence the right to purchase, at the adjusted Exercise Price, that
number of shares (calculated to the nearest thousandth) obtained by dividing (i)
the product obtained by multiplying the number of shares purchasable upon
exercise of this Warrant prior to adjustment of the number of shares by the
Exercise Price in effect prior to adjustment of the Exercise Price, by (ii) the
Exercise Price in effect after such adjustment of the Exercise Price.
(i) The Company shall not be required to issue fractions of shares
of Common Stock or other capital stock of the Company upon the exercise of this
Warrant. If any fraction of a share would be issuable on the exercise of this
Warrant (or specified portions thereof), the Company shall purchase such
fraction for an amount in cash equal to the same fraction of the Current Market
Price of such share of Common Stock on the date of exercise of this Warrant.
7. Beneficial Ownership. The Company shall not effect the exercise of this
Warrant, and no Person (as defined below) who is a holder of this Warrant shall
have the right to exercise this Warrant, to the extent that after giving effect
to such exercise, such Person (together with such Person's affiliates) would
beneficially own in excess of 9.99% of the shares of the Common Stock
outstanding immediately after giving effect to such exercise. For purposes of
the foregoing sentence, the aggregate number of shares of Common Stock
beneficially owned by such Person and its affiliates shall include the number of
shares of Common Stock issuable upon exercise of this Warrant with respect to
which the determination of such sentence is being made, but shall exclude shares
of Common Stock which would be issuable upon (i) exercise of the remaining,
unexercised portion of this Warrant beneficially owned by such Person and its
affiliates and (ii) exercise or conversion of the unexercised or unconverted
portion of any other securities of the Company beneficially owned by such Person
and its affiliates (including, without limitation, any debentures, convertible
notes or convertible preferred stock or warrants) subject to a limitation on
conversion or exercise analogous to the limitation contained herein. Except as
set forth in the preceding sentence, for purposes of this paragraph, beneficial
ownership shall be calculated in
B-10
accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended. For purposes of this Warrant, in determining the number of outstanding
shares of Common Stock, a holder may rely on the number of outstanding shares of
Common Stock as reflected in (1) the Company's most recent Form 10-Q, Form 10-K
or other public filing with the Securities and Exchange Commission, as the case
may be, (2) a more recent public announcement by the Company or (3) any other
notice by the Company or its Transfer Agent setting forth the number of shares
of Common Stock outstanding. For any reason at any time, upon the written or
oral request of the holder of this Warrant, the Company shall within two
Business Days confirm orally and in writing to the holder of this Warrant the
number of shares of Common Stock then outstanding. In any case, the number of
outstanding shares of Common Stock shall be determined after giving effect to
the conversion or exercise of securities of the Company by the holder of this
Warrant and its affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. In effecting the exercise of this Warrant,
the Company shall be entitled to rely on a representation by the holder of this
Warrant as to the number of shares that it beneficially owns for purposes of the
above 9.99% limitation calculation.
8. Transfer Taxes. The issuance of any shares or other securities upon the
exercise of this Warrant, and the delivery of certificates or other instruments
representing such shares or other securities, shall be made without charge to
the Holder for any tax or other charge in respect of such issuance. The Company
shall not, however, be required to pay any tax which may be payable in respect
of any transfer involved in the issue and delivery of any certificate in a name
other than that of the Holder and the Company shall not be required to issue or
deliver any such certificate unless and until the person or persons requesting
the issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
9. Loss or Mutilation of Warrant. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction, or mutilation of
any Warrant (and upon surrender of any Warrant if mutilated), and upon
reimbursement of the Company's reasonable incidental expenses, the Company shall
execute and deliver to the Holder thereof a new Warrant of like date, tenor, and
denomination.
10. No Rights as a Stockholder. The Holder of any Warrant shall not have,
solely on account of such status, any rights of a stockholder of the Company,
either at law or in equity, or to any notice of meetings of stockholders or of
any other proceedings of the Company, except as provided in this Warrant.
11. Governing Law. This Warrant shall be construed in accordance with the
laws of the State of Delaware applicable to contracts made and performed within
such State, without regard to principles of conflicts of law.
Dated: September 16, 2003
CYTRX CORPORATION
By:
-----------------------------------------
Xxxxxx X. Xxxxxxxxx,
Chief Executive Officer
B-11
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer the
attached Warrant.)
FOR VALUE RECEIVED, hereby sells, assigns, and transfers unto
__________________ a Warrant to purchase __________ shares of Common Stock, par
value $0.001 per share, of CytRx Corporation (the "Company"), together with all
right, title, and interest therein, and does hereby irrevocably constitute and
appoint attorney to transfer such Warrant on the books of the Company, with full
power of substitution.
Dated:
-----------------------------
By:
--------------------------------
Signature
The signature on the foregoing Assignment must correspond to the name
as written upon the face of this Warrant in every particular, without alteration
or enlargement or any change whatsoever.
B-12
To: CytRx Corporation
00000 Xxx Xxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
NOTICE OF EXERCISE
The undersigned hereby exercises his or its rights to purchase _______
Warrant Shares covered by the within Warrant and tenders payment herewith in the
amount of $_________ by [tendering cash or delivering a certified check or bank
cashier's check, payable to the order of the Company] [surrendering ______
shares of Common Stock received upon exercise of the attached Warrant, which
shares have a Current Market Price equal to such payment] in accordance with the
terms thereof, and requests that certificates for such securities be issued in
the name of, and delivered to:
---------------------------------------
---------------------------------------
---------------------------------------
(Print Name, Address and Social Security
or Tax Identification Number)
and, if such number of Warrant Shares shall not be all the Warrant Shares
covered by the within Warrant, that a new Warrant for the balance of the Warrant
Shares covered by the within Warrant be registered in the name of, and delivered
to, the undersigned at the address stated below.
Dated:
---------------------------------
By:
------------------------------------
Print Name
---------------------------------------
Signature
Address:
------------------------------
------------------------------
------------------------------
B-13
EXHIBIT C
---------
FORM OF OPINION
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware and has the requisite
corporate power to own, lease and operate its properties and assets, and to
carry on its business as presently conducted.
2. The Company has the requisite corporate power and authority to enter
into and perform its obligations under the Transaction Documents and to issue
the Shares, the Warrants and the Warrant Shares. The execution, delivery and
performance of each of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated thereby have been duly and
validly authorized by all necessary corporate action and no further consent or
authorization of the Company or its Board of Directors is required. Each of the
Transaction Documents have been duly executed and delivered, and the Shares and
the Warrants have been duly executed, issued and delivered by the Company and
each of the Transaction Documents constitutes a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
respective terms. Neither the Shares nor the Warrant Shares are subject to any
preemptive rights under the Certificate of Incorporation or the Bylaws.
3. The Shares have been duly authorized and, when delivered against
payment in full as provided in the Agreement, will be validly issued, fully paid
and nonassessable. The Warrant Shares, have been duly authorized and reserved
for issuance, and, when delivered upon exercise or against payment in full as
provided in the Warrants, will be validly issued, fully paid and nonassessable.
4. The execution, delivery and performance of and compliance with the
terms of the Transaction Documents and the issuance of the Shares, the Warrants
and the Warrant Shares do not (a) violate any provision of the Certificate of
Incorporation or Bylaws, (b) conflict with, or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any rights of termination, amendment, acceleration or
cancellation of, any material Post-Acquisition Agreement to which the Company is
a party and which is known to us, (c) create or impose a lien, charge or
encumbrance on any property of the Company under any Post-Acquisition Agreement
known to us to which the Company is a party or by which the Company is bound or
by which any of its respective properties or assets are bound, or (d) result in
a violation of any Federal, state, local or foreign statute, rule, regulation,
order, judgment, injunction or decree applicable to the Company or by which any
property or asset of the Company is bound or affected (provided, however, that
our opinion is limited to those statutes, rules and regulations which, in our
experience, are typically applicable to transactions of the type contemplated by
the Agreement), except, in all cases other than violations pursuant to clauses
(a) and (d) above, for such conflicts, default, terminations, amendments,
acceleration, cancellations and violations as would not, individually or in the
aggregate, have a Material Adverse Effect. "Post-Acquisition Agreement" refers
to all agreements, mortgages, deeds of trust, indentures, notes, bonds,
licenses, lease agreements, instruments or other obligations of the Company that
the Company entered into after the July 19, 2002 acquisition of Global Genomics
Capital, Inc.
C-1
5. No consent, approval or authorization of or designation, declaration
or filing with any governmental authority on the part of the Company is required
under Federal, state or local law, rule or regulation in connection with the
valid execution, delivery and performance of the Transaction Documents, or the
offer, sale or issuance of the Shares, the Warrants or the Warrant Shares other
than filings as may be required by applicable Federal and state securities laws
and regulations and the NASD rules and regulations (provided, however, that our
opinion is limited to those statutes, rules and regulations which, in our
experience, are typically applicable to transactions of the type contemplated by
the Agreement).
6. To our knowledge, there is no action, suit, claim, investigation or
proceeding pending or threatened against the Company which questions the
validity of the Agreement or the transactions contemplated thereby or any action
taken or to be taken pursuant thereto. Except as set forth in the Agreement, to
our knowledge, there is no action, suit, claim, investigation or proceeding
pending, or to our knowledge, threatened, against or involving the Company or
any of its properties or assets and which, if adversely determined, is
reasonably likely to result in a Material Adverse Effect.
7. The offer, issuance and sale of the Shares and the Warrants, and the
offer, issuance and sale of the Warrant Shares pursuant to the Warrants, are
exempt from the registration requirements of Section 5 of the Securities Act of
1933, as amended.
C-2
EXHIBIT D
---------
FORM OF REGISTRATION RIGHTS AGREEMENT
D-1
SCHEDULE OF EXCEPTIONS TO
REPRESENTATIONS AND WARRANTIES
These Schedules are furnished by CytRx Corporation, a Delaware
corporation (the "Company"), pursuant to the Securities Purchase Agreement dated
as of September 15, 2003 (the "Purchase Agreement"), by and among the Company
and the investors listed on Exhibit A attached thereto.
Nothing in the Schedules constitutes an admission of any
liability or obligation of the Company to any third party, nor an admission to
any third party against the Company's interests. Unless otherwise stated, all
statements made herein are made as of the date of execution of the Purchase
Agreement. The Schedules are qualified in their entirety by reference to
specific provisions of the Purchase Agreement.
The representations and warranties made by the Company in the
Purchase Agreement are qualified by, and subject to the exceptions noted in, the
information set forth in these Schedules. The inclusion or disclosure of any
item or information in the Schedules shall not be construed as an admission that
such item or information is material to the Company, and any inclusion in the
Schedules shall expressly not be deemed to constitute an admission, or otherwise
imply, that any such item or information is material or creates measures for
materiality for the purposes of the Purchase Agreement.
Any matter described in any section or subsection of any
Schedule shall be deemed set forth for all purposes in any other Schedule to the
extent such matter is reasonably related to the Schedule in question.
Headings have been inserted on the sections of the Schedules
for convenience of reference only and shall to no extent have the effect of
amending or changing the express description of the sections as set forth in the
Purchase Agreement. Capitalized terms used herein but not otherwise defined
shall have the meanings set forth in the Purchase Agreement.
SCHEDULE 2.1(B)
---------------
None.
SCHEDULE 2.1(C)
---------------
Preferred Shares
----------------
Shares Authorized 1,000
Shares Outstanding none
Common Shares
-------------
Shares Authorized 50,000,000
Shares Outstanding (excluding 28,608,776
treasury shares)
Securities Convertible Into Common Shares
-----------------------------------------
No. Shares
----------------------
Stock Option Plans 1,967,208
Stock Purchase Warrants 5,256,302
Total Convertible Securities 7,223,510
----------------------
Securities Entitled to Registration Rights
------------------------------------------
As required by registration rights agreements previously entered
into by the Company, there are two Registration Statements on Form
S-3 currently in effect (SEC registration nos. 333-106629 and
333-100947). In addition to the securities covered by these two Form
S-3 Registration Statements, the following securities are covered by
registration rights:
(i) Xxxxxxxx and assignee warrants - aggregate of 1,413,880 shares
(ii) See, "Commitments to Issue Additional Shares of Common Stock"
for a description of registration rights ( the Company has agreed to
grant to Xx. Xxxxxxx X. Czech.
(iii) The Company has agreed to register 357,500 shares of common
stock owned by X.X. Xxxxxx & Company LLC, including 82,500 shares of
common stock underlying stock purchase warrants issued to X.X.
Xxxxxx & Company LLC
(iv) As compensation for the services rendered to the Company by the
placement agents engaged in the offer and sale of the Common Stock
offered hereby, the Company has agreed to grant such placement
agents warrants to purchase shares of Common Stock. The Company has
agreed to register the shares of Common Stock issuable upon the
exercise of the warrants to be granted to the placement agents of
this offering.
Commitments to Issue Additional Shares of Common Stock
------------------------------------------------------
The Company has reached an agreement in principle with Rip Xxxxxxxx &
Associates to issue that firm 100,000 shares of common stock as its
fee in connection with the University of Massachusetts Medical School
transaction.
The Company has entered into an Agreement in Principle (the "Agreement
in Principle") with Araios, Inc. ("Araios"), a Delaware corporation,
and Xxxxxxx X. Czech regarding the formation, capitalization and
control of Araios. Under the terms of the Agreement in Principle, the
Company will acquire a 95% equity interest in Araios, and Dr. Czech
will own the remaining 5% interest. Commencing 18 months after the
closing of the Company's investment in Araios, Dr. Czech will have the
right to "put" his 5% equity interest in Araios to the Company in
exchange for 650,000 shares of Common Stock. The Company has agreed
that it will register the 650,000 shares that may be issued to Dr.
Czech on the next Form S-3 filed by the Company following the issuance
of those shares, provided that Dr. Czech shall have demand
registration rights to cause those shares to be registered at the
Company's expense if the shares are not registered within 180 days of
issuance.
Pursuant to the Agreement in Principle, the Company is required to (i)
increase its stock option plans to set aside 900,000 shares of its
outstanding Common Stock for equity incentive grants to Araios
employees, which grants will be made by the Company's Compensation
Committee in consultation with Araios, and (ii) grant options to
purchase up to 20,000 shares of Common Stock to each of the three new
members of Araois' advisory board.
SCHEDULE 2.1(F)
---------------
None.
SCHEDULE 2.1(G)
---------------
Subsidiaries % Ownership
---------------
GGC Pharmaceuticals, Inc. 100%
Proceutics, Inc. (inactive) 100%
CytRx Animal Health, Inc. (inactive) 100%
Custom Adjuvants, Inc. (inactive) 100%
Minority Owned Entities (held by GGC Pharmaceuticals)
-----------------------------------------------------
Blizzard Genomics, Inc. 40%
Psynomics, Inc. 5%
SCHEDULE 2.1(H)
---------------
None.
SCHEDULE 2.1(I)
---------------
None.
SCHEDULE 2.1(J)
---------------
None.
SCHEDULE 2.1(K)
---------------
As described in Agreement in Principle, the Company agreed to invest
$7,000,000 in Araios and has agreed to fund additional staffing and
infrastructure expenditures.
SCHEDULE 2.1(L)
---------------
None.
SCHEDULE 2.1(M)
---------------
None.
SCHEDULE 2.1(N)
---------------
None.
SCHEDULE 2.1(O)
---------------
None.
SCHEDULE 2.1(P)
---------------
Xxxxxxxx Capital Corp., Dunwoody Brokerage Services, Inc., Gilford
Securities Incorporated, Cardinal Securities, LLC, X.X. Xxxxxx & Co., Maxim
Group LLC and are serving as placement agents and will receive cash fees and
warrants in connection with this transaction.
SCHEDULE 2.1(R)
---------------
Registered domain name - xxx.XxxXx.xxx
License Agreements
Vical Incorporated
Merck & Co., Inc.
Carnegie Institution
Ivy Animal Health
University of Massachusetts Medical School (seven license
agreements covering pending and provisional patent
applications)
Trademarks, Patents and Patent Applications
See Exhibit A to Schedule 2.1(r).
SCHEDULE 2.1(S)
---------------
None.
SCHEDULE 2.1(U)
---------------
The Company will be required to file certain of the agreements that it
enters into with Araios and/or Xx. Xxxxxxx X. Czech in accordance with the
Agreement in Principle.
Amendment to Professional Services Agreement between the Company and
the Xxxxxxxxx Group
Employment Agreement between the Company and Xxxx Xxxxxxx, Chief
Financial Officer of the Company
SCHEDULE 2.1(V)
---------------
As stated in the Agreement in Principle, (i) the Company will be
required to appoint Dr. Czech to the Company's Scientific Advisory Board, (ii)
Araios, as a subsidiary of the Company, will be required to enter into an
employment agreement with Xxxx X. Xxxxxx, Ph.D., and (iii) Araios will be
required to appoint up to three other persons to the Scientific Advisory Board
of Araios.
SCHEDULE 2.1(X)
---------------
Notice of issuance of the Company's shares required to be delivered to
Nasdaq prior to closing of transaction will be delivered after closing.
SCHEDULE 2.1(Y)
---------------
None.
SCHEDULE 2.1(Z)
---------------
Between July 1, 2003 and September 12, 2003, the Company has granted
options to purchase up to 210,000 shares of Common Stock to Xxxx Xxxxxxx, the
Company's new Chief Financial Officer. In addition, on July 29, 2003, the
Company agreed to grant options to purchase 350,000 shares of Common Stock to
Xxxxx Xxxxxxx, Ph.D., a Director, the Chairman of the Scientific Advisory Board,
and Chief Scientific Spokesman of the Company.
No warrants have been granted by the Company since July 1, 2003.
Between July 1, 2003 and September 12, 2003, the Company issued a total
of 984,336 shares of common stock issued pursuant to the exercise of outstanding
options and warrants. In addition, the Company has issued 100,000 shares of
common stock as a finder's fee.
In August 2003, the Company hired (i) Xxxx Xxxxxxx as the Company's new
Chief Financial Officer, (ii) Xx Xxxxx as the Company's new Director of
Operations, (iii) Xxxxx Xxxx as the Company's new Director of Business
Development; and (iv) Xxxxxxx Xxxxxx as the Company's new Director of
Communications.
Exhibit A
K-S MATTER NO. CLIENT NO. COUNTRY TITLE
------------------------------------------------------------------------------------------------------------------------------------
216026 19720-0035 US Method of Stimulating the Immune System
------------------------------------------------------------------------------------------------------------------------------------
216034 19720-0043CA Canada Improved Fibrinolytic Composition
------------------------------------------------------------------------------------------------------------------------------------
216043 19720-0051IL Israel Improved Fibrinolytic Composition
------------------------------------------------------------------------------------------------------------------------------------
216044 19720-0052 US Improved Fibrinolytic Composition
Combination with fibrinolytic
------------------------------------------------------------------------------------------------------------------------------------
216046 19720-0053 US Improved Fibrinolytic Composition - Treating Tumors
------------------------------------------------------------------------------------------------------------------------------------
216054 19720-0057 US An Improved Method for Treating Xxxxx
------------------------------------------------------------------------------------------------------------------------------------
216055 19720-0058 US An Improved Method for Treating Sickle Cell Anemia
------------------------------------------------------------------------------------------------------------------------------------
216093 19720-0077 US Antiinfective Compounds and Method of Use
------------------------------------------------------------------------------------------------------------------------------------
216113 19720-0101 US Method of Treating Ischemic Tissue
------------------------------------------------------------------------------------------------------------------------------------
216119 19720-0110 US Improved Method for Treating Damaged Tissue
------------------------------------------------------------------------------------------------------------------------------------
216122 19720-0112 US Method of Treating Tissue Damaged by Reperfusion Injury
------------------------------------------------------------------------------------------------------------------------------------
216138 19720-0151 US Improved Method of Performing Angioplasty Procedures
------------------------------------------------------------------------------------------------------------------------------------
216144 19720-0162IE Ireland Injectable Pharmaceutical Composition for the Protection of
Tissue Damaged by Ischemia
------------------------------------------------------------------------------------------------------------------------------------
216154 19720-0186 US Method of Delivering Drugs to Damaged or Diseased Tissue
------------------------------------------------------------------------------------------------------------------------------------
216225 19720-0222 US Polyoxypropylene/Polyoxyethelene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
216226 19720-0223 US Polyoxypropylene/Polyoxyethelene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
216231 19720-0224 US Improved Antiinfective Polyoxypropylene/Polyoxyethelene
Copolymers and Methods of Use
------------------------------------------------------------------------------------------------------------------------------------
216232 19720-0225 US Polyoxypropylene/Polyoxyethelene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
216233 19720-0226 US Polyoxypropylene/Polyoxyethylene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
216234 19720-0227 US Polyoxypropylene/Polyoxyethylene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
216235 19720-0228 US Polyoxypropylene/Polyoxyethylene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
263913 19720-0229 US Polyoxypropylene/Polyoxyethylene Copolymers with Improved
Biological Activity
------------------------------------------------------------------------------------------------------------------------------------
216263 00000-0000XX Xxxxx Improved Fibrinolytic Composition
------------------------------------------------------------------------------------------------------------------------------------
216332 19720-0500AT Austria Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216333 19720-0500AU Australia Australia--Methods and Compositions for Treatment of
Pathological Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216334 19720-0500BE Belgium Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216335 19720-0500CA Canada Canada--Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216336 19720-0500CH Switzerland Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216337 19720-0500DE Germany Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216339 19720-0500EP EPO EPO--Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216340 19720-0500ES Spain Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216342 19720-0500FR France Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216343 19720-0500GB United Kingdom Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216345 19720-0500IT Italy Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216347 19720-0500LU Luxembourg Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216348 19720-0500NL Netherlands Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216350 19720-0500SE Sweden Methods and Compositions for Treatment of Pathological
Hydrophobic Interactions in Biological Fluids
------------------------------------------------------------------------------------------------------------------------------------
216352 19720-0501 US Method of Treating Myocardial Damage
------------------------------------------------------------------------------------------------------------------------------------
216354 19720-0502 US Method of Treating Myocardial Damage
------------------------------------------------------------------------------------------------------------------------------------
216356 19720-0511 US Method of Treating Stroke
------------------------------------------------------------------------------------------------------------------------------------
216358 19720-0513 US Method of Treating Stroke
------------------------------------------------------------------------------------------------------------------------------------
216359 19720-0520 US Method of Treating Adult Respiratory Distress Syndrome
------------------------------------------------------------------------------------------------------------------------------------
216377 19720-0573 US Method of Treating Tumors
------------------------------------------------------------------------------------------------------------------------------------
216415 19720-0620AT Austria Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620BE Belgium Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
216414 19720-0620CA Canada Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620CH Switzerland Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620DE Germany Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620DK Denmark Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
216415 19720-0620EP EPO Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620ES Spain Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620FR France Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620GB United Kingdom Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620IE Ireland Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620IT Italy Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
216416 00000-0000XX Xxxxx Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
216417 19720-0620KR South Korea Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620NL Netherlands Therapeutic Delivery Compositions and Methods of Use Thereof
19720-0620SE Sweden Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
216422 19720-0624 US Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
261843 19720-0625 US Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
262529 19720-0626 US Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
276833 19720-0627WP PCT Therapeutic Delivery Compositions and Methods of Use Thereof
------------------------------------------------------------------------------------------------------------------------------------
216433 19720-0650AT Austria Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216432 19720-0650CA Canada Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216433 19720-0650DE Germany Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216433 19720-0650EP EPO Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216433 19720-0650FR France Novel Vaccine Adjuvant and Vaccine
19720-0650IE Ireland Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216433 19720-0650IT Italy Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216434 00000-0000XX Xxxxx Novel Vaccine Adjuvant and Vaccine
00000-0000XX Xxxxxx Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
269291 19720-0651EP EPO Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
277996 19720-0651HK Hong Kong Method for Making Polyoxypropylene/Polyoxyethylene Block
Copolymers
------------------------------------------------------------------------------------------------------------------------------------
216438 19720-0652 US Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216443 19720-0657 US Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
216444 19720-0658 US Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
271667 19720-0659 US Novel Vaccine Adjuvant and Vaccine
------------------------------------------------------------------------------------------------------------------------------------
245350 22031-0065AT Austria Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245351 22031-0065AU Australia Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245352 22031-0065BE Belgium Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245354 22031-0065CA Canada Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245355 22031-0065CH Switzerland Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245357 22031-0065DE Germany Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245358 22031-0065DK Denmark Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245359 22031-0065EP EPO Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245360 22031-0065ES Spain Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245361 22031-0065FR France Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245362 22031-0065GB Great Britain Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245363 22031-0065GR Greece Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245364 22031-0065IE Ireland Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245366 22031-0065IT Italy Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245367 00000-0000XX Xxxxx Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245368 22031-0065KR South Korea Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245369 22031-0065LU Luxembourg Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245372 22031-0065NL Netherlands Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245373 22031-0065NZ New Zealand Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245375 22031-0065PT Portugal Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245376 22031-0065SE Sweden Improved Adjuvants and Vaccines
------------------------------------------------------------------------------------------------------------------------------------
245382 22031-0069 US Methods and Vaccines Comprising Surface-Active Copolymers
------------------------------------------------------------------------------------------------------------------------------------
245415 22031-0095 US Multiple Emulsions and Methods of Preparation
------------------------------------------------------------------------------------------------------------------------------------
245416 22031-0096 US Multiple Emulsions and Methods of Preparation (Oral Vaccines)
------------------------------------------------------------------------------------------------------------------------------------
245508 22170-0100CA Canada Biologically Active Copolymers
------------------------------------------------------------------------------------------------------------------------------------
245510 00000-0000XX Xxxxx Biologically Active Copolymers
------------------------------------------------------------------------------------------------------------------------------------
245512 22170-0100DE Germany Use of Biologically Active Copolymers for the Manufacture of a
Medicament for Stimulating the Growth of an Animal
------------------------------------------------------------------------------------------------------------------------------------
245515 22170-0100ES Spain Biologically Active Copolymers
------------------------------------------------------------------------------------------------------------------------------------
245517 22170-0100FR France Use of Biologically Active Copolymers for the Manufacture of a
Medicament for Stimulating the Growth of an Animal
------------------------------------------------------------------------------------------------------------------------------------
245518 22170-0100GB United Kingdom Use of Biologically Active Copolymers for the Manufacture of a
Medicament for Stimulating the Growth of an Animal
------------------------------------------------------------------------------------------------------------------------------------
245526 22170-0100MX Mexico Biologically Active Copolymers
------------------------------------------------------------------------------------------------------------------------------------
245527 22170-0100NL Netherlands Use of Biologically Active Copolymers for the Manufacture of a
Medicament for Stimulating the Growth of an Animal
------------------------------------------------------------------------------------------------------------------------------------
245550 22170-0105 US Biologically-Active Copolymers
------------------------------------------------------------------------------------------------------------------------------------
245564 22170-0121 US Growth Promoting Compositions and Methods of Use
------------------------------------------------------------------------------------------------------------------------------------
FILING DATE APPL. SERIAL NO. ISSUE DATE PATENT NO.
------------------------------------------------------------------------------------------------------------------------------------
6/12/1991 107,358 8/10/1993 5,234,683
------------------------------------------------------------------------------------------------------------------------------------
5/13/1987 537,052 3/24/1992 1,297,792
------------------------------------------------------------------------------------------------------------------------------------
5/14/1987 82519 8/26/1992 P/82519
------------------------------------------------------------------------------------------------------------------------------------
5/7/1987 07/045,459 1/31/1989 4,801,452
------------------------------------------------------------------------------------------------------------------------------------
12/21/1987 07/136,034 10/10/1989 4,873,083
------------------------------------------------------------------------------------------------------------------------------------
12/29/1988 07/291,925 11/7/1989 4,879,109
------------------------------------------------------------------------------------------------------------------------------------
1/13/1989 07/297,156 6/6/1989 4,837,014
------------------------------------------------------------------------------------------------------------------------------------
6/1/1995 08/457,808 9/22/1998 5,811,088
------------------------------------------------------------------------------------------------------------------------------------
5/11/1990 07/522,193 2/18/1992 5,089,260
------------------------------------------------------------------------------------------------------------------------------------
6/1/1989 07/359,903 1/30/1990 4,897,263
------------------------------------------------------------------------------------------------------------------------------------
5/4/1990 07/519,005 8/20/1991 5,041,288
------------------------------------------------------------------------------------------------------------------------------------
5/3/1990 07/518,510 5/21/1991 5,017,370
------------------------------------------------------------------------------------------------------------------------------------
7/23/1992 922401
------------------------------------------------------------------------------------------------------------------------------------
5/4/1990 07/519,148 7/9/1991 5,030,448
------------------------------------------------------------------------------------------------------------------------------------
7/2/1993 08/087,136 4/18/2000 Re. 36,665
------------------------------------------------------------------------------------------------------------------------------------
8/9/1994 08/292,803 10/22/1996 5,567,859
------------------------------------------------------------------------------------------------------------------------------------
6/6/1995 08/468,137 10/7/1997 5,674,911
------------------------------------------------------------------------------------------------------------------------------------
6/2/1995 08/460,192 12/9/1997 5,696,298
------------------------------------------------------------------------------------------------------------------------------------
6/3/1996 08/657,161 11/25/1997 5,691,387
------------------------------------------------------------------------------------------------------------------------------------
7/8/1997 08/889,342 11/23/1999 5,990,241
------------------------------------------------------------------------------------------------------------------------------------
8/5/1999 09/368,855 3/19/2002 6,359,014
------------------------------------------------------------------------------------------------------------------------------------
12/14/2001 10/017,223
------------------------------------------------------------------------------------------------------------------------------------
5/8/1987 62-503333 12/7/1994 1891157
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 E 149 791
------------------------------------------------------------------------------------------------------------------------------------
7/18/1990 48495/90 10/11/1993 637996
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
12/29/1989 2,006,953 2,006,953
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 3/12/1997 409940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
8/22/1990 90 901 954.9 0 409 940
------------------------------------------------------------------------------------------------------------------------------------
5/11/1990 07/522,168 7/2/1991 5,028,599
------------------------------------------------------------------------------------------------------------------------------------
12/4/1991 07/802,331 3/30/1993 5,198,211
------------------------------------------------------------------------------------------------------------------------------------
5/11/1990 07/522,297 9/10/1991 5,047,236
------------------------------------------------------------------------------------------------------------------------------------
12/4/1992 07/985,746 8/31/1993 5,240,702
------------------------------------------------------------------------------------------------------------------------------------
5/3/1990 07/518,348 3/5/1991 4,997,644
------------------------------------------------------------------------------------------------------------------------------------
3/24/1995 08/409,549 7/15/1997 5,648,071
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/12/1996 2,174,122
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
4/15/1996 7-512031
------------------------------------------------------------------------------------------------------------------------------------
4/15/1996 701930-1996 6/8/1999 218140
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3 723440
------------------------------------------------------------------------------------------------------------------------------------
4/30/1996 94 931827.3
------------------------------------------------------------------------------------------------------------------------------------
12/9/1999 09/457,771
------------------------------------------------------------------------------------------------------------------------------------
7/31/2001 09/919,504
------------------------------------------------------------------------------------------------------------------------------------
8/14/2001 09/929,819
------------------------------------------------------------------------------------------------------------------------------------
7/31/2002 PCT/US02/24425
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6 5/29/2002 E218.066
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 2,196,801
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6 6/17/2002 774974
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6 5/29/2002 774974
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6 5/29/2002 774974
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6 8/14/2002 28003BE/2002
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 8-507368
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 95 929336.6 5/29/2002 774 974
------------------------------------------------------------------------------------------------------------------------------------
11/23/2001 1127904.9
------------------------------------------------------------------------------------------------------------------------------------
11/23/2001 2106150.1 1044890A
------------------------------------------------------------------------------------------------------------------------------------
8/9/1995 08/513,162 7/11/2000 6,086,899
------------------------------------------------------------------------------------------------------------------------------------
12/28/1998 09/221,339 11/21/2000 6,149,922
------------------------------------------------------------------------------------------------------------------------------------
3/21/2000 09/532,345 7/9/2002 6,416,947
------------------------------------------------------------------------------------------------------------------------------------
4/2/2002 10/115332
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 E 157 259
------------------------------------------------------------------------------------------------------------------------------------
6/27/1991 US91/04716 4/24/1995 655593
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/22/1992 US91/04716 6/12/2001 20,860,397
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 US91/04716 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
6/27/1991 91 913213.4 2/27/2002 82178
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/28/1992 US91/04716 11/21/1996 2112600
------------------------------------------------------------------------------------------------------------------------------------
12/26/1992 US91/04716 6/8/1999 218138
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
6/26/1991 07/544,831 6/26/1991 238731
------------------------------------------------------------------------------------------------------------------------------------
6/27/1991 07/544,831 9/3/1998 98119
------------------------------------------------------------------------------------------------------------------------------------
12/21/1992 91 913213.4 8/27/1997 536302
------------------------------------------------------------------------------------------------------------------------------------
4/11/1995 08/420,333 9/10/1996 5,554,372
------------------------------------------------------------------------------------------------------------------------------------
8/16/1994 08/291,286 4/22/1997 5,622,649
------------------------------------------------------------------------------------------------------------------------------------
1/20/1995 08/376,088 3/23/1999 5,885,590
------------------------------------------------------------------------------------------------------------------------------------
6/18/1986 745,917 2/5/1991 1,279,822
------------------------------------------------------------------------------------------------------------------------------------
7/7/1986 465-86 9/22/1989 36564
------------------------------------------------------------------------------------------------------------------------------------
2/16/1987 86 904 533.6 8/28/1991 0 228 448
------------------------------------------------------------------------------------------------------------------------------------
7/7/1986 86 904 533.6 11/3/1987 556.216(3)
------------------------------------------------------------------------------------------------------------------------------------
2/16/1987 86 904 533.6 8/28/1991 0 228 448
------------------------------------------------------------------------------------------------------------------------------------
2/16/1987 86 904 533.6 8/28/1991 0 228 448
------------------------------------------------------------------------------------------------------------------------------------
7/14/1986 3119 10/3/1994 176179
------------------------------------------------------------------------------------------------------------------------------------
2/16/1987 86 904 533.6 8/28/1991 0 228 448
------------------------------------------------------------------------------------------------------------------------------------
10/9/1987 07/107,358 5/19/1992 5,114,708
------------------------------------------------------------------------------------------------------------------------------------
8/20/1996 08/700,074 10/20/1998 5,824,322
------------------------------------------------------------------------------------------------------------------------------------
TRADEMARK CASE NO. APPLN. NO. REG. NO. STATUS FILING DATE REG. DATE COUNTRY OWNER
TITERMAX 245427 557776 557776 Registered 14-Jun-1991 14-Jun-1991 Australia Cytrx Corporation
TITERMAX 245437 765008 502465 Registered 11-Jun-1991 11-Jun-1991 Benelux Cytrx Corporation
TITERMAX 245428 683649 396820 Registered 11-Jun-1991 03-Apr-1992 Canada Cytrx Corporation
TITERMAX 245430 VA4157/91 VR27591992 Registered 13-Jun-1991 10-Apr-1992 Denmark Cytrx Corporation
TITERMAX 245431 2745/91 120566 Registered 11-Jun-1991 20-Jul-1992 Finland Cytrx Corporation
TITERMAX 245432 290827 1670592 Registered 11-Jun-1991 00-Xxx-0000 Xxxxxx Cytrx Corporation
TITERMAX 245434 2831/91 146885 Registered 11-Jun-1991 11-Jun-1991 Ireland Cytrx Corporation
TITERMAX 245435 MI91C006616 626163 Registered 12-Sep-1991 00-Xxx-0000 Xxxxx Cytrx Corporation
TITERMAX 245436 3-60821 2569276 Registered 13-Jun-1991 00-Xxx-0000 Xxxxx Cytrx Corporation
TITERMAX 245438 91-05228 250845 Registered 13-Jun-1991 20-Aug-1993 Sweden Cytrx Corporation
TITERMAX 245433 1467066 1467066 Registered 12-Jun-1991 12-Jun-1991 United Kingdom Cytrx Corporation
TITERMAX 245426 74/081640 1695189 Registered 25-Jul-1990 16-Jun-1992 USA Cytrx Corporation
TITERMAX 216489 C42176/5WZ 2011164 Registered 04-Jul-1991 00-Xxx-00 Xxxxxxx Cytrx Corporation
Class Goods
5 Pharmaceutical, veterinary and sanitary
preparations and substances; vaccines;
adjuvants; vaccine adjuvants; all included
in class 5.
5 Pharmaceutical, veterinary and sanitary
preparations; dietetic substances adapted
for medical use, food for babies; plasters,
materials for dressings; material for
stopping teeth, dental wax; disinfectants;
preparations for destroying vermin;
fungicides,
5 Vaccine adjuvants.
5 Vaccine adjuvants.
5 Vaccine adjuvants.
5 Vaccine adjuvants.
5 Pharmaceutical and veterinary
preparations and substances;
vaccines and vaccine adjuvants.
5 Vaccine adjuvants.
1 Vaccine rejuvants.
5 Vaccines and vaccine adjuvants.
5 Pharmaceutical, veterinary and
sanitary preparations and
substances; vaccines; adjuvants;
vaccine adjuvants; all included
in Class 5.
5 Vaccine adjuvants.
5 Vaccine adjuvants.
