COMMON STOCK PURCHASE AGREEMENT
Dated as of October 4, 2000
by and between
CYTOGEN CORPORATION
and
ACQUA WELLINGTON
NORTH AMERICAN EQUITIES FUND, LTD.
TABLE OF CONTENTS
Page
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ARTICLE I Definitions.................................................1
Section 1.1 Definitions.................................................1
ARTICLE II Purchase and Sale of Common Stock...........................3
Section 2.1 Purchase and Sale of Stock..................................3
Section 2.2 The Shares..................................................3
Section 2.3 Purchase Price and Closing..................................3
ARTICLE III Representations and Warranties..............................4
Section 3.1 Representation and Warranties of the Company................4
Section 3.2 Representation and Warranties of the Purchaser.............10
ARTICLE IV Covenants..................................................12
Section 4.1 Securities.................................................12
Section 4.2 Registration and Listing...................................12
Section 4.3 Registration Statement.....................................12
Section 4.4 Compliance with Laws.......................................12
Section 4.5 Keeping of Records and Books of Account....................13
Section 4.6 Reporting Requirements.....................................13
Section 4.7 Non-public Information.....................................13
Section 4.8 Effective Registration Statement...........................13
Section 4.9 No Stop Orders.............................................13
Section 4.10 Amendments to the Registration Statement...................14
Section 4.11 Prospectus Delivery........................................14
Section 4.12 Other Financing............................................14
Section 4.13 Notice.....................................................15
ARTICLE V Conditions to Closing, Draw Downs and Call Options.........15
Section 5.1 Conditions Precedent to the Obligation of the
Company to Issue a Draw Down Notice or Grant
a Call Option and Sell the Shares........................15
Section 5.2 Conditions Precedent to the Obligation of the
Purchaser to Close.......................................16
Section 5.3 Conditions Precedent to the Obligation of the
Purchaser to Accept a Draw Down or Call
Option Grant and Purchase the Shares.....................17
ARTICLE VI Draw Down Terms; Call Option...............................18
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Section 6.1 Draw Down Terms............................................18
Section 6.2 Purchaser's Call Option....................................20
ARTICLE VII Termination................................................21
Section 7.1 Termination by Mutual Consent..............................21
Section 7.2 Other Termination..........................................21
Section 7.3 Effect of Termination......................................21
ARTICLE VIII Indemnification............................................22
Section 8.1 General Indemnity..........................................22
Section 8.2 Indemnification Procedures.................................23
ARTICLE IX Miscellaneous..............................................24
Section 9.1 Fees and Expenses..........................................24
Section 9.2 Specific Enforcement, Consent to Jurisdiction..............25
Section 9.3 Entire Agreement; Amendment................................25
Section 9.4 Notices....................................................25
Section 9.5 Waivers....................................................26
Section 9.6 Headings...................................................26
Section 9.7 Successors and Assigns.....................................26
Section 9.8 Governing Law..............................................27
Section 9.9 Survival...................................................27
Section 9.10 Counterparts...............................................27
Section 9.11 Publicity..................................................27
Section 9.12 Severability...............................................27
Section 9.13 Further Assurances.........................................27
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COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is dated as of
October 4, 2000 by and between Cytogen Corporation, a Delaware corporation (the
"Company"), and Acqua Wellington North American Equities Fund, Ltd., a limited
liability company organized under the laws of the Commonwealth of The Bahamas
(the "Purchaser").
The parties hereto agree as follows:
ARTICLE I
Definitions
Section 1.1 Definitions.
--------------------------
(a) "Alternate Market" shall mean the Nasdaq Small Cap Market, the
American Stock Exchange, the New York Stock Exchange or the OTC Bulletin Board,
whichever is at the time the principal trading exchange or market for the Common
Stock.
(b) "Call Option" shall have the meaning assigned to such term in Section
6.2(a) hereof.
(c) "Commission" shall have the meaning assigned to such term in Section
2.3 hereof.
(d) "Commission Documents" shall have the meaning assigned to such term in
Section 3.1(f) hereof.
(e) "Commission Filings" means the Company's Form 10-K for the fiscal year
ended December 31, 1999, the Company's 2000 Proxy Statement, filed with the
Commission on April 18, 2000, Forms 10-Q for the periods ended June 30, 2000 and
March 31, 2000, Registration Statement on Form S-3, No. 333-33436 and Forms 8-K,
dated July 14 and September 7, 2000 and all other filings made by the Company
after the date hereof pursuant to the Securities Exchange Act of 1934.
(f) "Common Stock" shall have the meaning assigned to such term in Section
2.1 hereof.
(g) "Draw Down" means the exercise by the Company of its right to request
the purchase of shares of Common Stock by the Purchaser.
(h) "Draw Down Amount" means the dollar amount requested to be drawn down
by the Company pursuant to a Draw Down Notice.
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(i) "Draw Down Discount Percentage" means 93%, provided, however, that for
every $75,000,000 increase in the Market Capitalization above $300,000,000, the
draw down discount percentage shall be increased by .625%, incrementally, up to
a maximum draw down discount percentage of 96%.
(j) "Draw Down Exercise Date" shall have the meaning assigned to such term
in Section 5.1 hereof.
(k) "Draw Down Notice" shall have the meaning assigned to such term in
Section 6.1(i) hereof.
(l) "Draw Down Pricing Period" shall mean a period of twenty (20)
consecutive Trading Days following a Draw Down Notice, or such other period
mutually agreed upon by the Purchaser and the Company.
(m) "Effective Date" shall mean June 14, 2000, the date the Registration
Statement of the Company covering the Shares being subscribed for hereby is
declared effective.
(n) "Investment Period" shall have the meaning assigned to such term in
Section 7.1 hereof.
(o) "Market Capitalization" shall mean the amount determined on the
Trading Day immediately preceding the commencement date of the Draw Down Pricing
Period and shall equal the product of (i) the VWAP of the Common Stock and (ii)
the Company's outstanding shares of Common Stock on such date, each as
determined by Bloomberg Financial LP using the DES and HP Functions.
(p) Material Adverse Effect" shall mean any effect on the business,
results of operations, assets or financial condition of the Company that is
material and adverse to the Company and its subsidiaries and affiliates, taken
as a whole and/or any condition, circumstance, or situation that would prohibit
the Company from entering into and performing any of its obligations under this
Agreement in any material respect.
(q) "Material Change in Ownership" shall mean that, as of any particular
measurement date, the officers and directors of the Company shall beneficially
own in the aggregate less than 4.75% of the outstanding Common Stock of the
Company, except that for purposes of making any such calculation, Common Stock
issued to the Purchaser pursuant to this Agreement shall not be included in such
calculation.
(r) "Prospectus" as used in this Agreement means the prospectus in the
form included in the Registration Statement, as supplemented by any prospectus
supplement filed with the Commission pursuant to Rule 424(b).
(s) "Registration Statement" shall mean the registration statement on Form
S-3, Commission File Number 333-33436 under the Securities Act, filed with the
Securities and Exchange Commission for the registration of the Shares, as such
Registration Statement may be amended from time to time.
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(t) "Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder.
(u) "Settlement Date" shall have the meaning assigned to such term in
Section 6.1(d) hereof.
(v) "Shares" shall mean the shares of Common Stock of the Company that may
be purchased hereunder.
(w) "Threshold Price" is the lowest price the Company may set in the Draw
Down Notice to sell Shares during a Draw Down Pricing Period (not taking into
account the Draw Down Discount Percentage during such Draw Down Pricing Period).
(x) "Trading Day" shall mean a day on which the Common Stock is traded on
the Nasdaq National Market or an Alternate Market.
(y) "VWAP" shall mean the daily volume weighted average price (based on a
Trading Day from 9:30 a.m. to 4:00 p.m., eastern time) of the Common Stock of
the Company on the NASDAQ National Market or an Alternate Market as reported by
Bloomberg Financial LP using the AQR function.
ARTICLE II
Purchase and Sale of Common Stock
SECTION 2.1 PURCHASE AND SALE OF STOCK. Subject to the terms and
conditions of this Agreement, the Company shall issue and sell to the Purchaser
and the Purchaser shall purchase from the Company up to $70,000,000 of the
Company's common stock, $0.01 par value per share (the "Common Stock"). Such
sale and purchase shall be made (i) pursuant to Draw Downs, subject to Section
6.1 hereof, and/or (ii) Call Options, subject to Section 6.2 hereof. Call
Options may be granted to the Purchaser in connection with any Draw Down up to
the Draw Down Amount as the Company in its sole discretion may determine.
SECTION 2.2 THE SHARES. The Company has authorized and has reserved and
covenants to continue to reserve, subject to Section 4.4(b) hereof, free of
preemptive rights and other similar contractual rights of stockholders, a
sufficient number of its authorized but unissued shares of its Common Stock to
cover the Shares to be issued in connection with any Draw Downs and Call
Options.
SECTION 2.3 CLOSING. The Company agrees to issue and sell to the Purchaser
and, in consideration of and in express reliance upon the representations,
warranties, covenants, terms and conditions of this Agreement, the Purchaser,
agrees to purchase that number of the Shares to be issued in connection with
each Draw Down and each Call Option exercised by the Purchaser. The closing of
the execution and delivery of this Agreement shall take place at the offices of
Xxxxxx Xxxxxx LLP, The Chrysler Building, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX
00000 (the "Closing") at 10:00 a.m., eastern time, on (i) October 4, 2000, or
(ii) such other time
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and place or on such date as the Purchaser and the Company
may agree upon (the "Closing Date"). Each party shall deliver all documents,
instruments and writings required to be delivered by such party pursuant to this
Agreement at or prior to the Closing.
ARTICLE III
Representations and Warranties
SECTION 3.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby makes the following representations and warranties to the Purchaser:
(a) Organization, Good Standing and Power. The Company is a corporation
duly incorporated, validly existing and in good standing under the laws 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.
As of the date hereof, the Company does not have any subsidiaries (as defined in
Section 3.1(g)) except as set forth in the Registration Statement and in the
Company's most recent Form 10-K, including the accompanying financial statements
(the "Form 10-K"), or in the Company's most recent Form 10-Q (the "Form 10-Q"),
or on Schedule 3.1(a) attached 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 in
which the failure to be so qualified will not have a Material Adverse Effect.
(b) Authorization; Enforcement. The Company has the requisite corporate
power and authority to enter into and perform this Agreement and to issue and
sell the Shares in accordance with the terms hereof. The execution, delivery and
performance of this Agreement by the Company and the consummation by it of the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action, and, except as contemplated by Section 4.4(b), no
further consent or authorization of the Company or its Board of Directors or
stockholders is required. This Agreement has been duly executed and delivered by
the Company. This Agreement 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, 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) Capitalization. The authorized capital stock of the Company and the
shares thereof issued and outstanding as of the date hereof are as set forth in
the Commission Documents. All of the outstanding shares of the Company's Common
Stock have been duly and validly authorized, and are fully paid and
non-assessable. Except as set forth in this Agreement or in the Commission
Documents, as of the date hereof no shares of Common Stock 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 in this Agreement
or in the Commission Documents, as of the date hereof there are no
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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 set forth in the Commission Documents, as of the date hereof, the Company is
not a party to any agreement granting registration rights to any person with
respect to any of its equity or debt securities. The Company is not a party to,
and it has no knowledge of, any agreement restricting the voting or transfer of
any shares of the capital stock of the Company. 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 stockholder has a right of rescission or damages
with respect thereto which would have a Material Adverse Effect. The Company has
furnished or made available to the Purchaser true and correct copies of the
Company's Restated Certificate of Incorporation as in effect on the date hereof
(the "Charter"), and the Company's Amended and Restated Bylaws as in effect on
the date hereof (the "Bylaws").
(d) Issuance of Shares. The Shares to be issued under this Agreement have
been duly authorized by all necessary corporate action and, when paid for and
issued in accordance with the terms hereof, the Shares shall be validly issued
and outstanding, fully paid and non-assessable, and the Purchaser shall be
entitled to all rights accorded to a holder of Common Stock.
(e) No Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated herein do not (i) violate any provision of the Company's Charter or
Bylaws, (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
material agreement, mortgage, deed of trust, indenture, note, bond, license,
lease agreement, instrument or obligation to which the Company is a party, (iii)
create or impose a lien, charge or encumbrance on any property of the Company
under any agreement or any commitment 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 (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 are bound or affected, except, in all cases (other than violations
pursuant to clauses (i) and (iv) (to the extent of federal securities law), for
such conflicts, defaults, terminations, amendments, acceleration, cancellations
and violations as would not, individually or in the aggregate, have a Material
Adverse Effect. The Company is not required under federal, state 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 this Agreement, or
issue and sell the Shares in accordance with the terms hereof (other than any
filings which may be required to be made by the Company with the Commission, or
the Nasdaq National Market subsequent to the Closing, and, any registration
statement which may be filed pursuant hereto); provided that, for purpose of the
representation made in this sentence, the Company is assuming and relying upon
the accuracy of the relevant representations and agreements of the Purchaser
herein.
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(f) Commission Documents, Financial Statements. The Common Stock of the
Company is registered pursuant to Section 12(b) or 12(g) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and 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 Purchaser true
and complete copies of the Commission Documents filed with the Commission since
December 31, 1999 and prior to the Closing Date. The Company has not provided to
the Purchaser any 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 contemplated by
this Agreement. The Form 10-K for the year ended December 31, 1999 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 said 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. The financial statements of the Company included
in the Commission Documents comply 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).
(g) Subsidiaries. The Commission Documents set forth each material
subsidiary of the Company as of the date hereof, 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. Except as set forth in the Commission Documents or the Commission
Filings, none of such subsidiaries is a "significant subsidiary" as defined in
Regulation S-X.
(h) No Material Adverse Effect. Since June 30, 2000, the Company has not
experienced or suffered any Material Adverse Effect.
(i) No Undisclosed Liabilities. The Company has no liabilities,
obligations, claims or losses (whether liquidated or unliquidated, secured or
unsecured, absolute, accrued, contingent or otherwise) that would be required to
be disclosed on a balance sheet of the
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Company or any subsidiary (including the notes thereto) in conformity with GAAP
not disclosed in the Commission Documents, other than those incurred in the
ordinary course of the Company's or its subsidiaries respective businesses since
June 30, 2000 and which, individually or in the aggregate, do not or would not
have a Material Adverse Effect.
(j) No Undisclosed Events or Circumstances. 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 and which, individually or in the aggregate, do not or would not have
a Material Adverse Effect.
(k) Indebtedness. The Commission Documents set forth as of the date
thereof, all material outstanding secured and unsecured Indebtedness of the
Company, or for which the Company or any subsidiary has commitments. For the
purposes of this Agreement, "Indebtedness" shall mean (a) any liabilities for
borrowed money or amounts owed other than trade accounts payable incurred in the
ordinary course of business, (b) all guaranties, endorsements and other
contingent obligations in respect of Indebtedness of others, whether or not the
same are or should be reflected in the Company's balance sheet (or the notes
thereto), except guaranties by endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of business; and
(c) the present value of any lease payments due under leases required to be
capitalized in accordance with GAAP. Neither the Company or any subsidiary is in
default with respect to any Indebtedness.
(l) Title to Assets. Each of the Company and its subsidiary has good and
marketable title to all of its real and personal property reflected in the
Commission Documents, free of any mortgages, pledges, charges, liens, security
interests or other encumbrances, except for those indicated in the Commission
Documents and the Commission Filings or such that could not reasonably be
expected to cause 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
in all material respects.
(m) Actions Pending. There is no action, suit, claim, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company which questions the validity of this Agreement or the transactions
contemplated hereby or any action taken or to be taken pursuant hereto or
thereto. There is no action, suit, claim, investigation or proceeding pending
or, to the knowledge of the Company, threatened, against or involving the
Company or any subsidiary, or any of their respective properties or assets
which, if adversely determined, is reasonably likely to result in a Material
Adverse Effect.
(n) Compliance with Law. The business of the Company has been and is
presently being conducted in accordance with all applicable federal, state and
local governmental laws, rules, regulations and ordinances, except as such that
do not cause a Material Adverse Effect. Each of the Company and its subsidiary
has all franchises, permits, licenses, consents and other governmental or
regulatory authorizations and approvals necessary for the conduct of its
business as now being conducted unless the failure to possess such franchises,
permits, licenses, consents and other governmental or regulatory authorizations
and approvals,
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individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
(o) Certain Fees. No brokers, finders or financial advisory fees or
commissions will be payable by the Company with respect to the transactions
contemplated by this Agreement.
(p) 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 Purchaser by or on behalf of the Company in
connection with the transactions contemplated by this Agreement contain any
untrue statement of a material fact or omits 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.
(q) Operation of Business. The Company or its subsidiary owns or has a
valid right to use all patents, trademarks, service marks, trade names,
copyrights, licenses and authorizations as set forth in the Commission Documents
and all rights with respect to the foregoing, which are necessary for the
conduct of its business as now conducted without any conflict with the rights of
others, except to the extent set forth in the Commission Documents or that a
Material Adverse Effect could not reasonably be expected to result from such
conflict.
(r) Environmental Compliance. Except as disclosed in the Commission Filings, the
Company has obtained all 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. "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 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 for such instances as would not individually or in the aggregate have a
Material Adverse Effect, to the best of the Company's knowledge, there are no
past or present events, conditions, circumstances, incidents, actions or
omissions relating to or in any way affecting the Company that violate or could
reasonably be expected to violate any Environmental Law after the Closing or
that could reasonably be expected to give rise to any environmental liability,
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.
(s) Material Agreements. Except as set forth in the Commission Documents
and this Agreement, the Company is not 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 as an exhibit to a
registration statement on Form S-3 or applicable
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form (collectively, "Material Agreements") if the Company was registering
securities under the Securities Act. The Company has in all material respects
performed all the obligations required to be performed to date under the
foregoing agreements, has received no notice of default and, to the best of the
Company's knowledge is not in default under any Material Agreement now in
effect, the result of which could reasonably be expected to cause a Material
Adverse Effect.
(t) Transactions with Affiliates. Except as disclosed in the Commission
Filings, there are no loans, leases, agreements, contracts, royalty agreements,
management contracts or arrangements or other continuing transactions exceeding
$100,000 between (a) the Company, or any of its customers (excluding agreements
related to the purchase or lease of the Company's products) or suppliers on the
one hand, and (b) on the other hand, any officer, employee, consultant or
director of the Company, or any person who would be covered by Item 404(a) of
Regulation S-K or any corporation or other entity controlled by such officer,
employee, consultant, director or person.
(u) Securities Act of 1933. The Company has complied in all material
respects with all applicable federal and state securities laws in connection
with the offer, issuance and sale of the Shares hereunder.
(i) Each Prospectus included as part of the Registration Statement
as originally filed or as part of any amendment or supplement thereto, or
filed pursuant to Rule 424 under the Securities Act, complied when so
filed in all material respects with the provisions of the Securities Act.
The Commission has not issued any order preventing or suspending the use
of any Prospectus.
(ii) The Company meets the requirements for the use of Form S-3
under the Securities Act. The Registration Statement in the form in which
it became effective and also in such form as it may be when any
post-effective amendment thereto became effective and the Prospectus and
any supplement or amendment thereto when filed with the Commission under
Rule 424(b) under the Securities Act, complied in all material respects
with the provisions of the Securities Act and did not at any such times
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein (in the case of the Prospectus, in the light of the circumstances
under which they made) not misleading, except that this representation and
warranty does not apply to statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information relating to the Purchaser furnished to the
Company in writing by or on behalf of the Purchaser through you expressly
for use therein.
(iii) The Company has not distributed and, prior to the completion
of the sale of the Shares to the Purchaser, will not distribute any
offering material in connection with the offering and sale of the Shares
other than the Registration Statement, the Prospectus or other materials,
if any, permitted by the Securities Act.
(v) Employees. As of the date hereof, the Company has no collective
bargaining arrangements or agreements covering any of its employees. Except as
required to be set forth in the Commission Documents, as of the date hereof the
Company has no employment contract or any other similar contract or restrictive
covenant, relating to the right of any officer,
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employee or consultant to be employed or engaged by the Company. Each of the
Company and its subsidiary requires its officers, technical employees and
certain consultants to enter into agreements regarding proprietary information
and assignment of inventions, or other similar agreements containing restrictive
covenants. As of the date hereof, since December 31, 1999, no officer,
consultant or key employee of the Company whose termination, either individually
or in the aggregate, could reasonably be expected to 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.
(w) Use of Proceeds. The proceeds from the sale of the Shares will be used
by the Company and its subsidiary for general corporate purposes.
(x) 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.
(y) ERISA. No liability to the Pension Benefit Guaranty Corporation has
been incurred with respect to any Plan by the Company which is or would have a
Material Adverse Effect. The execution and delivery of this Agreement and the
issue and sale of the Shares 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, provided that, if any of the Purchaser, or any person or entity that
owns a beneficial interest in any of the 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 3.1(y), 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 by any trade or business, whether or not
incorporated, which, together with the Company, is under common control, as
described in Section 414(b) or (c) of the Code.
(z) Acknowledgment Regarding Purchaser's Purchase of Shares. The Company
acknowledges and agrees that the Purchaser is acting solely in the capacity of
arm's length purchaser with respect to this Agreement and the transactions
contemplated hereunder. The Company further acknowledges that the Purchaser is
not acting as a financial advisor or fiduciary of the Company (or in any similar
capacity) with respect to this Agreement and the transactions contemplated
hereunder and any advice given by the Purchaser or any of its representatives or
agents in connection with this Agreement and the transactions contemplated
hereunder is merely incidental to the Purchaser's purchase of the Shares.
SECTION 3.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
hereby makes the following representations and warranties to the Company:
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(a) Organization and Standing of the Purchaser. The Purchaser is a limited
liability company duly organized, validly existing and in good standing under
the laws of the Commonwealth of The Bahamas.
(b) Authorization and Power. The Purchaser has the requisite corporate
power and authority to enter into and perform this Agreement and to purchase the
Shares in accordance with the terms hereof. The execution, delivery and
performance of this Agreement by Purchaser and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action, and no further consent or authorization of the Purchaser, its
Board of Directors or stockholders is required. This Agreement constitutes, or
shall constitute when executed and delivered, a valid and binding obligation of
the Purchaser enforceable against the Purchaser in accordance with its 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) No Conflicts. The execution, delivery and performance of this
Agreement and the consummation by the Purchaser of the transactions contemplated
hereby and thereby or relating hereto do not and will not (i) result in a
violation of such Purchaser's charter documents or bylaws or (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 material agreement, mortgage,
deed of trust, indenture, note, bond, license, lease agreement, instrument or
obligation to which the Purchaser is a party, (iii) create or impose or lien,
charge or encumbrance on any property of the Purchaser under any agreement or
any commitment to which the Purchaser is party or by which the Purchaser is on
or by which any of its respective properties or assets are bound or (iv) result
in a violation of any law, rule, or regulation, or any order, judgment or decree
of any court or governmental agency applicable to the Purchaser or its
properties, except for such conflicts, defaults and violations as would not,
individually or in the aggregate, prohibit or otherwise interfere with the
ability of the Purchaser to enter into and perform its obligations under this
Agreement in any material respect. The Purchaser is not required 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 this Agreement or to purchase the Shares in accordance
with the terms hereof, provided that for purposes of the representation made in
this sentence, the Purchaser is assuming and relying upon the accuracy of the
relevant representations and agreements of the Company herein.
(d) Information. The Purchaser and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Shares which
have been requested by the Purchaser. The Purchaser and its advisors, if any,
have been afforded the opportunity to ask questions of the Company. The
Purchaser has sought such accounting, legal and tax advice as it has considered
necessary to make an informed investment decision with respect to its
acquisition of the Shares. Purchaser understands that it (and not the Company)
shall be responsible for its own tax liabilities that may arise as a result of
this investment or the transactions contemplated by this Agreement.
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(e) Selling Restriction. The Purchaser has the right to sell shares of the
Company's Common Stock during the Investment Period. The Purchaser covenants
that prior to and during the Investment Period, neither the Purchaser nor any of
its affiliates nor any entity managed by the Purchaser will ever sell shares of
Common Stock of the Company other than what the Purchaser has accumulated to
purchase under the terms of this Agreement or in any accounts directly or
indirectly managed by the Purchaser or any affiliate of the Purchaser or any
entity managed by the Purchaser.
ARTICLE IV
Covenants
The Company covenants with the Purchaser as follows, which covenants are
for the benefit of the Purchaser and its permitted assignees, that during the
term of this Agreement and the Investment Period:
SECTION 4.1 SECURITIES. The Company shall notify the Commission and the
Nasdaq National Market or an Alternate Market, if applicable, in accordance with
their rules and regulations, of the transactions contemplated by this Agreement,
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 Shares to the Purchaser or subsequent holders.
SECTION 4.2 REGISTRATION AND LISTING. The Company will take all action
necessary to cause its Common Stock to continue to be registered under Sections
12(b) or 12(g) of the Exchange Act, will comply in all respects with its
reporting and filing obligations under the Exchange Act, 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 will take all
action necessary to continue the listing or trading of its Common Stock and the
listing of the Shares purchased by Purchaser hereunder on the Nasdaq National
Market or any Alternate Market and will comply in all respects with the
Company's reporting, filing and other obligations under the bylaws or rules of
the Nasdaq National Market or any Alternate Market.
SECTION 4.3 REGISTRATION STATEMENT. Before the Company shall issue a Draw
Down Notice, the Company shall have caused a sufficient number of shares of
Common Stock to be authorized and registered to cover the Shares to be issued in
connection with such Draw Down Notice.
SECTION 4.4 COMPLIANCE WITH LAWS.
(a) The Company shall comply with all applicable laws, rules, regulations
and orders, noncompliance with which could have a Material Adverse Effect.
(b) The Company will not be obligated to issue and the Purchaser will not
be obligated to purchase any shares of the Company's Common Stock which would
result in the
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issuance under this Agreement of more than nineteen and nine-tenths percent
(19.9%) of the issued and outstanding shares of the Company's Common Stock.
SECTION 4.5 KEEPING OF RECORDS AND BOOKS OF ACCOUNT. The Company shall
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 4.6 REPORTING REQUIREMENTS. Upon request, the Company shall
furnish the following to the Purchaser so long as such Purchaser shall be
obligated hereunder to purchase Shares:
(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 fiscal quarters of the Company; and
(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.
SECTION 4.7 NON-PUBLIC INFORMATION. Neither the Company nor any of its
officers or agents shall disclose any material non-public information about the
Company to the Purchaser and neither the Purchaser nor any of its affiliates,
officers or agents will solicit any material non-public information from the
Company.
SECTION 4.8 EFFECTIVE REGISTRATION STATEMENT. If it is necessary for the
Registration Statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, the Company will
endeavor to cause the Registration Statement or such post-effective amendment to
become effective as soon as reasonably practicable and will advise the Purchaser
promptly and, if requested by the Purchaser, will confirm such advice in
writing, when it receives notice that the Registration Statement or such
post-effective amendment has become effective.
SECTION 4.9 NO STOP ORDERS. The Company will advise the Purchaser promptly
and, if requested by the Purchaser, will confirm such advice in writing: (i) of
the Company's receipt of notice of any request by the Commission for amendment
of or a supplement to the Registration Statement, any Prospectus or for
additional information; (ii) of the Company's receipt of notice of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) of the Company's becoming aware of the happening of any
event, which makes any statement of a material fact made in the Registration
Statement or the Prospectus (as then amended or supplemented) untrue or which
requires the making of any additions to or changes in the Registration Statement
or the Prospectus (as then amended or supplemented) in order to state a material
fact required by the Securities Act or the regulations thereunder to be stated
therein or
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necessary in order to make the statements therein not misleading, or of the
necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Securities Act or any other law. If at any time
the Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make all reasonable efforts to obtain
the withdrawal of such order at the earliest possible time.
SECTION 4.10 AMENDMENTS TO THE REGISTRATION STATEMENT. The Company will
not (i) file any amendment to the Registration Statement or make any amendment
or supplement to the Prospectus of which the Purchaser shall not previously have
been advised or (ii) so long as, in the reasonable opinion of counsel for the
Purchaser, a Prospectus is required to be delivered in connection with sales by
any Purchaser or dealer, file any information, documents or reports pursuant to
the Exchange Act without delivering a copy of such information, documents or
reports to the Purchaser, promptly following such filing.
SECTION 4.11 PROSPECTUS DELIVERY. The Company shall file a prospectus
supplement to its Registration Statement one Trading Day immediately prior to
each Settlement Date, and will deliver to the Purchaser, without charge, in such
quantities as reasonably requested by the Purchaser, copies of each form of
Prospectus and prospectus supplement on each Settlement Date. The Company
consents to the use of the Prospectus (and of any amendment or supplement
thereto) in accordance with the provisions of the Securities Act and with the
securities or Blue Sky laws of the jurisdictions in which the Shares may be sold
by the Purchaser, in connection with the offering and sale of the Shares and for
such period of time thereafter as the Prospectus is required by the Securities
Act to be delivered in connection with sales of the Shares. If during such
period of time any event shall occur that in the judgment of the Company or in
the opinion of counsel for the Purchaser is required to be set forth in the
Prospectus (as then amended or supplemented) or should be set forth therein in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus to comply with the Securities Act or any other law, the
Company will forthwith prepare and, subject to the provisions of Section 4.10
above, file with the Commission an appropriate supplement or amendment thereto,
and will expeditiously furnish to the Purchaser a reasonable number of copies
thereof.
SECTION 4.12 OTHER FINANCING. If the Company enters into any other
financing agreement, the primary purpose of which would be to obtain equity
financing for the Company, during a Draw Down Pricing Period (an "Other
Financing"), the Company shall promptly notify the Purchaser of such Other
Financing and the Purchaser shall have the options set forth in Section 6.1(k)
hereof. As used herein, "Other Financing" shall not include: (A) the Company (i)
entering into a loan, credit or lease facility with a bank or financing
institution (including any equity component thereof), (ii) establishing an
employee stock option plan or agreement or finance the acquisition of other
companies, equipment, technologies or lines of business, (iii) issuing shares of
Common Stock in connection with the Company's current option plans (as the same
may be amended from time to time), stock purchase plans, rights plans, currently
outstanding warrants or options, or increase the number of shares available
under any such plans (the primary purpose of which is not to raise equity), and
(iv) issuing shares of Common Stock and/or preferred stock in connection with
the formation and maintenance of strategic
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partnerships, alliances or joint ventures and the acquisition of other
companies, products, licenses or other assets; or (B) any financing by a
subsidiary of the Company (each a "Permitted Transaction").
SECTION 4.13 NOTICE. The Company shall immediately notify the Purchaser
that (i) a Material Adverse Effect or Material Change in Ownership has occurred
or (ii) the Company has entered into an Other Financing (as defined in Section
4.12 hereof).
ARTICLE V
Conditions to Closing, Draw Downs and Call Options
SECTION 5.1 CONDITIONS PRECEDENT TO THE OBLIGATION OF THE COMPANY TO ISSUE
A DRAW DOWN NOTICE OR GRANT A CALL OPTION AND SELL THE SHARES. The obligation
hereunder of the Company to issue a Draw Down Notice or grant a Call Option and
sell the Shares to the Purchaser is subject to the satisfaction or waiver, at or
before each Draw Down or Call Option request (the "Draw Down Exercise Date") and
at or before each Settlement Date, of each 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 Purchaser's Representations and Warranties. The
representations and warranties of the Purchaser in this Agreement shall be true
and correct in all material respects as of the date when made and as of each
Draw Down Exercise Date and each Settlement Date as though made at that time,
except for representations and warranties that are expressly made as of a
particular date.
(b) Registration Statement. The Company shall have Shares registered under
the Registration Statement equal to or in excess of the number of Shares
issuable pursuant to such Draw Down Notice or Call Option. The Registration
Statement registering the offer and sale of the Shares shall have been declared
effective by the Commission and shall have been amended or supplemented, as
required, to disclose the sale of the Shares prior to each Settlement Date, as
applicable.
(c) Performance by the Purchaser. The 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 Purchaser at or prior to each Settlement Date.
(d) No Injunction. No statute, 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 Suspension, Etc. Trading in the Company's Common Stock shall not
have been suspended by the Commission or the Nasdaq National Market or an
Alternate Market (except for any suspension of trading of limited duration
agreed to by the Company, which
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suspension shall be terminated prior to such Draw Down Exercise Date and
applicable Settlement Date), and, at any time prior to each Draw Down Exercise
Date, trading in securities generally as reported on the Nasdaq National Market
or an Alternate Market shall not have been suspended or limited, or minimum
prices shall not have been established on securities whose trades are reported
by the Nasdaq National Market or an Alternate Market, nor shall a banking
moratorium have been declared either by the United States or New York State
authorities, nor shall there have occurred any material outbreak or escalation
of hostilities or other national or international calamity or crisis of such
magnitude in its effect on, or any material adverse change in any financial
market which, in each case, in the judgment of the Company, makes it
impracticable or inadvisable to issue the Shares.
(f) 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 of the officers, directors or affiliates of the Company
seeking to restrain, prevent or change the transactions contemplated by this
Agreement, or seeking damages in connection with such transactions.
SECTION 5.2 CONDITIONS PRECEDENT TO THE OBLIGATION OF THE PURCHASER TO
CLOSE. The obligation hereunder of the Purchaser to enter 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 Purchaser's sole
benefit and may be waived by the Purchaser at any time in its sole discretion.
(a) Accuracy of the Company's Representations and Warranties. Each of the
representations and warranties of the Company 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 speak as of a
particular date.
(b) Performance by the Company. The Company 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 Company at or prior to the Closing.
(c) Effective Registration Statement. The Registration Statement
registering the offer and sale of the Shares shall have been declared effective
by the Commission and shall have been amended or supplemented, as required, to
disclose the sale of the Shares prior to each Settlement Date, as applicable.
(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 of the
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officers, directors or affiliates of the Company seeking to restrain, prevent or
change the transactions contemplated by this Agreement, or seeking damages in
connection with such transactions.
(f) Opinion of Counsel, Etc. At the Closing, the Purchaser shall have
received an opinion of counsel to the Company, dated the date of Closing, in the
form of Exhibit A hereto, a secretary's certificate, dated the date of Closing,
in the form of Exhibit B hereto, and such other certificates and documents as
the Purchaser or its counsel shall reasonably require incident to the Closing.
SECTION 5.3 CONDITIONS PRECEDENT TO THE OBLIGATION OF THE PURCHASER TO
ACCEPT A DRAW DOWN OR CALL OPTION GRANT AND PURCHASE THE SHARES. The obligation
hereunder of the Purchaser to accept a Draw Down or Call Option grant and to
acquire and pay for the Shares on the Settlement Date is subject to the
satisfaction or waiver, at or before each Draw Down Exercise Date and each
Settlement Date, as applicable, of each of the conditions set forth below. The
conditions are for the Purchaser's sole benefit and may be waived by the
Purchaser at any time in its sole discretion.
(a) Accuracy of the Company's Representations and Warranties. Each of the
representations and warranties of the Company shall be true and correct in all
material respects as of the date when made and as of the Draw Down Exercise Date
and Settlement Date, as applicable, as though made at that time, except for
representations and warranties that speak as of a particular date.
(b) Registration Statement. The Company shall have Shares registered under
the Registration Statement equal to or in excess of the number of Shares
issuable pursuant to such Draw Down Notice or Call Option. The Registration
Statement registering the offer and sale of the Shares shall have been declared
effective by the Commission and shall have been amended or supplemented, as
required, to disclose the sale of the Shares prior to each Draw Down Exercise
Date or each Settlement Date, as applicable.
(c) No Suspension, Etc. Trading in the Company's Common Stock shall not
have been suspended by the Commission or the Nasdaq National Market or an
Alternate Market (except for any suspension of trading of limited duration
agreed to by the Company, which suspension shall be terminated prior to each
Draw Down Exercise Date), and, at any time prior to such Draw Down Exercise Date
or such Settlement Date, trading in securities generally as reported by the
Nasdaq National Market or an Alternate Market shall not have been suspended or
limited, or minimum prices shall not have been established on securities whose
trades are reported by the Nasdaq National Market or an Alternate Market, nor
shall a banking moratorium have been declared either by the United States or New
York State authorities, nor shall there have occurred any material outbreak or
escalation of hostilities or other national or international calamity or crisis
of such magnitude in its effect on, or any material adverse change in any
financial market which, in each case, in the judgment of the Purchaser, makes it
impracticable or inadvisable to purchase the Shares. The Common Stock shall not
have been delisted from Nasdaq or an Alternate Market.
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(d) Performance by the Company. The Company 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 Company at or prior to each Draw Down Exercise Date and each
Settlement Date and shall have delivered the Compliance Certificate
substantially in the form attached hereto as Exhibit C.
(e) 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.
(f) 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 of the officers, directors or affiliates of the Company
seeking to restrain, prevent or change the transactions contemplated by this
Agreement, or seeking damages in connection with such transactions.
(g) No Material Adverse Effect; No Material Change in Ownership. No
Material Adverse Effect or Material Change in Ownership shall have occurred.
ARTICLE VI
Draw Down Terms; Call Option
SECTION 6.1 DRAW DOWN TERMS. Subject to the satisfaction of the conditions
set forth in this Agreement, the parties agree as follows:
(a) The Company, may, in its sole discretion, issue a Draw Down Notice
with respect to a Draw Down during each Draw Down Pricing Period of up to (i)
$5,000,000 if the Threshold Price is equal to $4.00 and (ii) up to an additional
$500,000 for every $.50 increase in the Threshold Price above $4.00, for a
maximum Draw Down Amount during each Draw Down Pricing Period of up to
$30,000,000; provided, that the Company may, in its sole discretion, issue a
Draw Down Notice with respect to any Draw Down Amount at any Threshold Price or
any Draw Down Discount Percentage pursuant to terms mutually agreed upon by the
Purchaser and the Company, which Draw Down the Purchaser will be obligated to
accept. Prior to issuing any Draw Down Notice, the Company shall have Shares
registered under the Registration Statement which are valued at an amount equal
to or in excess of the Draw Down Amount.
(b) The number of Shares to be issued in connection with each Draw Down
shall be equal to the sum of the quotients (for each Trading Day of the Draw
Down Pricing Period for which the VWAP equals or exceeds the Threshold Price) of
(x) 1/20th (or such other fraction based on the length of the Draw Down Pricing
Period) of the Draw Down Amount divided by (y) the applicable Draw Down Discount
Percentage multiplied by the VWAP of the Common Stock for such Trading Day.
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(c) Only one Draw Down shall be allowed in each Draw Down Pricing Period.
(d) The number of Shares purchased by the Purchaser with respect to each
Draw Down shall be determined on a daily basis during each Draw Down Pricing
Period and settled on the second Trading Day following the end of each Draw Down
Pricing Period (the "Settlement Date").
(e) There shall be a minimum of five (5) Trading Days between Draw Downs,
unless otherwise mutually agreed upon between the Purchaser and the Company.
(f) There shall be a maximum of twelve (12) monthly Draw Downs during the
term of this Agreement.
(g) Each Draw Down will expire on the end of the last Trading Day of each
Draw Down Pricing Period.
(h) If the VWAP on a given Trading Day is less than the Threshold Price,
then the total amount of the Draw Down for the relevant Draw Down Pricing Period
will be reduced by 1/20th (or such other fraction based on the length of the
Draw Down Pricing Period). At no time shall the Threshold Price be set below
$4.00, unless mutually agreed upon by the Company and the Purchaser. If trading
in the Company's Common Stock is suspended for any reason for more than three
(3) hours in any Trading Day, at the Purchaser's option, the price of the Common
Stock shall be deemed to be below the Threshold Price for that Trading Day and
the Draw Down for the relevant Draw Down Pricing Period shall be reduced by
1/20th (or such other fraction based on the length of the Draw Down Pricing
Period). Notwithstanding anything in the foregoing to the contrary, for each
Trading Day during the Draw Down Pricing Period that the VWAP is less than the
Threshold Price or is deemed to be below the Threshold Price pursuant to the
immediately preceding sentence, the Purchaser may elect in its sole discretion
to purchase Shares at a price equal to the Threshold Price multiplied by the
Draw Down Discount Percentage at the end of such Draw Down Pricing Period. The
Purchaser will inform the Company via facsimile transmission no later than 8:00
p.m. (eastern time) on the last Trading Day of such Draw Down Pricing Period as
to the number of Shares, if any, the Purchaser chooses to purchase under such
circumstances set forth in this Section 6.1(h).
(i) The Company must inform the Purchaser via facsimile transmission as to
the Draw Down Amount the Company wishes to exercise before commencement of
trading on the first Trading Day of the Draw Down Pricing Period (the "Draw Down
Notice"), substantially in the form attached hereto as Exhibit D. In addition to
the Draw Down Amount, the Company shall set the Threshold Price with each Draw
Down Notice and shall designate the first Trading Day of the Draw Down Pricing
Period. Notwithstanding anything in the foregoing to the contrary, if the
Company wishes the date of the Draw Down Notice to be the first day of the Draw
Down Pricing Period, the Draw Down Notice must be delivered to the Purchaser and
receipt of such Draw Down Notice confirmed by the Purchaser prior to the
commencement of trading on the date of such Draw Down Notice.
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(j) On each Settlement Date, the Company shall deliver the Shares
purchased by the Purchaser to the Purchaser or to The Depositary Trust Company
("DTC") on the Purchaser's behalf via the Deposit Withdrawal Agent Commission
system ("DWAC"), and upon receipt of the Shares, the Purchaser shall cause
payment therefor to be made to the account designated by the Company by wire
transfer of immediately available funds provided that the Shares are received no
later than 1:00 p.m., eastern time, or next day available funds if the Shares
are received thereafter.
(k) If during any Draw Down Pricing Period the Company shall enter into an
Other Financing (other than shares of Common Stock issued under this Agreement
or in connection with a Permitted Transaction), the Purchaser may in its sole
discretion (i) purchase the Draw Down Amount of shares of Common Stock and/or
exercise Call Options granted during such Draw Down Pricing Period on the terms
at which the Company issued shares of Common Stock in the Other Financing during
such Draw Down Pricing Period, (ii) purchase the Draw Down Amount of shares of
Common Stock and/or exercise Call Options granted during such Draw Down Pricing
Period at the applicable Draw Down Discount Percentage times the VWAP for such
Draw Down Pricing Period, or (iii) elect not to purchase any Shares during such
Draw Down Pricing Period. The Purchaser shall notify the Company of its election
on the Trading Day preceding the Settlement Date.
(l) If on the Settlement Date, the Company fails to deliver the Shares to
be purchased by the Purchaser, and such failure continues for ten (10) Trading
Days, the Company shall pay, in cash or restricted shares of Common Stock, at
the option of the Purchaser, as liquidated damages and not as a penalty to the
Purchaser an amount equal to two percent (2%) of the Draw Down Amount for the
initial thirty (30) days and each additional thirty (30) day period thereafter
until such failure has been cured, which shall be pro rated for such periods
less than thirty (30) days (the "Periodic Amount"). Cash payments to be made
pursuant to this clause (1) shall be due and payable immediately upon demand in
immediately available cash funds. Certificates evidencing the restricted shares
of Common Stock shall be delivered immediately upon demand. The parties agree
that the Periodic Amount represents a reasonable estimate on the part of the
parties, as of the date of this Agreement, of the amount of damages that may be
incurred by the Purchaser if the Company fails to deliver the Shares on the
Settlement Date. If the Purchaser elects to receive shares of Common Stock
instead of cash, the Purchaser shall have the right to demand registration once
within twelve (12) months of the date of issuance of such shares of Common Stock
and piggyback registration rights if the Company files a separate registration
statement.
SECTION 6.2 PURCHASER'S CALL OPTION.
(a) During each Draw Down Pricing Period, the Company, at its sole
discretion, may grant to the Purchaser the right to exercise multiple call
options of in the aggregate of up to the applicable Draw Down Amount (a "Call
Option"). The amount of the Call Option shall be set forth in the Draw Down
Notice. For each Trading Day during a Draw Down Pricing Period, the Purchaser
may exercise a Call Option by providing notice to the Company of the exercise of
a Call Option (the "Call Option Notice"), substantially in the form attached
hereto as Exhibit E. The total amount of Call Options exercised by the Purchaser
shall not exceed $35,000,000.
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(b) The number of shares of Common Stock to be issued in connection with
each Call Option shall equal the quotient of (i) the amount of the Call Option
exercised and (ii) the product of the applicable Draw Down Discount Percentage
and the greater of (A) the VWAP for the Common Stock on the day the Purchaser
issues its Call Option Notice and (B) the Threshold Price.
(c) Each Call Option exercised shall be settled on the applicable
Settlement Date.
(d) The Threshold Price designated by the Company in its Draw Down Notice
shall apply to each Call Option.
(e) For each Call Option that the Purchaser exercises pursuant to this
Section 6.2, the Purchaser must issue via facsimile a Call Option Notice to the
Company no later than 8:00 p.m. (eastern time) on the day such Call Option is
exercised. If the Purchaser does not exercise a Call Option by 8:00 p.m.
(eastern time) on the last day of the applicable Draw Down Pricing Period, the
Purchaser's Call Options with respect to that Draw Down Pricing Period shall
terminate.
ARTICLE VII
Termination
SECTION 7.1 TERMINATION BY MUTUAL CONSENT. The term of this Agreement
shall be the earlier of (i) twenty (20) months from the date of execution of
this Agreement (the "Investment Period"), (ii) the date that all of the shares
registered under the Registration Statement have been issued and sold and (iii)
the date that the Purchaser has purchased in the aggregate $70,000,000 pursuant
to all Draw Downs issued and Call Options granted and exercised. This Agreement
may be terminated at any time by mutual consent of the parties.
SECTION 7.2 OTHER TERMINATION. The Company shall inform the Purchaser, and
the Purchaser shall have the right to terminate this Agreement within the
subsequent thirty (30) days (the "Event Period"), if (x) the Company, without
the prior consent of the Purchaser, enters into an Other Financing (other than a
Permitted Transaction) which provides for (i) the issuance of Common Stock or
securities convertible, exercisable or exchangeable into Common Stock at a
discount to the then current market price of the Common Stock, (ii) a mechanism
for the reset of the purchase price of the Common Stock to below the then
current market price of the Common Stock, or (iii) the issuance of Common Stock
with warrants, which have an exercise price such that together with the price of
the Common Stock would result in the issuance of shares of Common Stock at a per
share price below the then current market price of the Common Stock, or (y) an
event resulting in a Material Adverse Effect or Material Change in Ownership has
occurred. The Purchaser may terminate this Agreement upon one (1) day's notice
during the Event Period.
SECTION 7.3 EFFECT OF TERMINATION. In the event of termination by the
Company or the Purchaser, 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 either
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party. If this Agreement is terminated as provided in Section 7.1 or 7.2 herein,
this Agreement shall become void and of no further force and effect, except as
provided in Section 9.9 hereof. Nothing in this Section 7.3 shall be deemed to
release the Company or the Purchaser from any liability for any breach under
this Agreement, or to impair the rights of the Company and the Purchaser to
compel specific performance by the other party of its obligations under this
Agreement.
ARTICLE VIII
Indemnification
SECTION 8.1 GENERAL INDEMNITY.
(a) Indemnification by the Company. The Company will indemnify and hold
harmless the Purchaser, each of its directors, fund managers and officers, and
each person, if any, who controls the Purchaser within the meaning of Section 15
of the Securities Act or Section 20(a) of the Exchange Act from and against any
losses, claims, damages, liabilities and expenses (including reasonable costs of
defense and investigation and all attorneys' fees) to which the Purchaser, each
of its directors, fund managers and officers, and each person, if any, who
controls the Purchaser may become subject, under the Securities Act or
otherwise, insofar as such losses, claims, damages, liabilities and expenses (or
actions in respect thereof) arise out of or are based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained, or
incorporated by reference, in the Registration Statement relating to Common
Stock being sold to the Purchaser (including the any prospectus supplement filed
in connection with the transactions contemplated hereunder (the "Prospectus
Supplement") which are a part of it), or any amendment or supplement to it, or
(ii) the omission or alleged omission to state in that Registration Statement or
any document incorporated by reference in the Registration Statement, a material
fact required to be stated therein or necessary to make the statements therein
not misleading, provided that the Company shall not be liable under this Section
8.1(a) to the extent that a court of competent jurisdiction shall have
determined by a final judgment (with no appeals available) that such loss,
claim, damage, liability or action resulted directly from any such acts or
failures to act, undertaken or omitted to be taken by the Purchaser or such
person through its bad faith or willful misconduct; provided, however, that the
foregoing indemnity shall not apply to any loss, claim, damage, liability or
expense to the extent, but only to the extent, arising out of or based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by the Purchaser expressly for use in the Registration Statement,
any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto); and provided, further, that with respect to the Prospectus, the
foregoing indemnity shall not inure to the benefit of the Purchaser or any such
person from whom the person asserting any loss, claim, damage, liability or
expense purchased Common Stock, if copies of the Prospectus were timely
delivered to the Purchaser pursuant hereto and a copy of the Prospectus (as then
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of the Purchaser or
any such person to such person, if required by law so to have been delivered, at
or prior to the written confirmation of the sale of the Common Stock to such
person,
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and if the Prospectus (as so amended or supplemented) would have cured the
defect giving rise to such loss, claim, damage, liability or expense.
The Company will reimburse the Purchaser and each such controlling person
promptly upon demand for any legal or other costs or expenses reasonably
incurred by the Purchaser or any controlling person in investigating, defending
against, or preparing to defend against any such claim, action, suit or
proceeding, except that the Company will not be liable to the extent a claim or
action which results in a loss, claim, damage, liability or expense arises out
of, or is based upon, an untrue statement, alleged untrue statement, omission or
alleged omission, included in any Prospectus or Prospectus Supplement or any
amendment or supplement to the Prospectus or Prospectus Supplement in reliance
upon, and in conformity with, written information furnished by the Purchaser to
the Company for inclusion in the Prospectus or Prospectus Supplement.
(b) Indemnification by the Purchaser. The Purchaser will indemnify and
hold harmless the Company, each of its directors and officers, and each person,
if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act from and against any
expenses (including reasonable costs of defense and investigation and all
attorneys' fees) to which the Company and each director, officer and person, if
any, who controls the Company may become subject, under the Securities Act or
otherwise, insofar as such losses, claims, damages, liabilities and expenses (or
actions in respect thereof) arise out of or are based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in any
Prospectus or Prospectus Supplement or any amendment or supplement to it or (ii)
the omission or alleged omission to state in any Prospectus or Prospectus
Supplement or any amendment or supplement to it a material fact required to be
stated therein or necessary to make the statements therein not misleading, to
the extent, but only to the extent, the untrue statement, alleged untrue
statement, omission or alleged omission was made in reliance upon, and in
conformity with, written information furnished by the Purchaser to the Company
for inclusion in the Prospectus or Prospectus Supplement or an amendment or
supplement to it, and the Purchaser will reimburse the Company and each such
director, officer or controlling person promptly upon demand for any legal or
other costs or expenses reasonably incurred by the Company or the other person
in investigating, defending against, or preparing to defend against any such
claim, action, suit or proceeding.
SECTION 8.2 INDEMNIFICATION PROCEDURES. Promptly after a person receives
notice of a claim or the commencement of an action for which the person intends
to seek indemnification under paragraph (a) or (b) of Section 8.1, the person
will notify the indemnifying party in writing of the claim or commencement of
the action, suit or proceeding, but failure to notify the indemnifying party
will not relieve the indemnifying party from liability under paragraph (a) or
(b) of Section 8.1, except to the extent it has been materially prejudiced by
the failure to give notice. The indemnifying party will be entitled to
participate in the defense of any claim, action, suit or proceeding as to which
indemnification is being sought, and if the indemnifying party acknowledges in
writing the obligation to indemnify the party against whom the claim or action
is brought, the indemnifying party may (but will not be required to) assume the
defense against the claim, action, suit or proceeding with counsel satisfactory
to it. After an indemnifying party notifies an indemnified party that the
indemnifying party wishes to assume the defense of a claim, action, suit or
proceeding the indemnifying party will not be liable for any
-23-
legal or other expenses incurred by the indemnified party in connection with the
defense against the claim, action, suit or proceeding except that if, in the
opinion of counsel to the indemnifying party, one or more of the indemnified
parties should be separately represented in connection with a claim, action,
suit or proceeding the indemnifying party will pay the reasonable fees and
expenses of one separate counsel for the indemnified parties. Each indemnified
party, as a condition to receiving indemnification as provided in Paragraph (a)
or (b) or Section 8.1, will cooperate in all reasonable respects with the
indemnifying party in the defense of any action or claim as to which
indemnification is sought. No indemnifying party will be liable for any
settlement of any action effected without its prior written consent. No
indemnifying party will, without the prior written consent of the indemnified
party, effect any settlement of a pending or threatened action with respect
which an indemnified party is, or is informed that it may be, made a party and
for which it would be entitled to indemnification, unless the settlement
includes an unconditional release of the indemnified party from all liability
and claims which are the subject matter of the pending or threatened action.
If for any reason the indemnification provided for in this Agreement is
not available to, or is not sufficient to hold harmless, an indemnified party in
respect of any loss or liability referred to in paragraph (a) or (b) of Section
8.1, each indemnifying party will, in lieu of indemnifying the indemnified
party, contribute to the amount paid or payable by the indemnified party as a
result of the loss or liability, (i) in the proportion which is appropriate to
reflect the relative benefits received by the indemnifying party on the one hand
and by the indemnified party on the other from the sale of stock which is the
subject of the claim, action, suit or proceeding which resulted in the loss or
liability or (ii) if that allocation is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits of the
sale of stock, but also the relative fault of the indemnifying party and the
indemnified party with respect to the statements or omissions which are the
subject of the claim, action, suit or proceeding that resulted in the loss or
liability, as well as any other relevant equitable considerations.
ARTICLE IX
Miscellaneous
SECTION 9.1 FEES AND EXPENSES. The Company shall pay all reasonable fees
and expenses related to the transactions contemplated by this Agreement;
provided, that the Company shall pay, at the Closing, all reasonable attorneys'
fees and expenses, exclusive of disbursements and out-of-pocket expenses,
incurred by the Purchaser of up to $50,000 in connection with the preparation,
negotiation, execution and delivery of this Agreement. In addition, the Company
shall pay all reasonable fees and expenses incurred by the Purchaser in
connection with any amendments, modifications or waivers of this Agreement. All
reasonable fees and expenses incurred in connection with the enforcement of this
Agreement by a party, including, without limitation, all reasonable attorneys'
fees and expenses, shall be paid by the defaulting party.
-24-
SECTION 9.2 SPECIFIC ENFORCEMENT, CONSENT TO JURISDICTION.
(a) The Company and the Purchaser acknowledge and agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
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 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) Each of the Company and the Purchaser (i) hereby irrevocably submits
to the jurisdiction of the United States District Court and other courts of the
United States sitting in the State of New York for the purposes of any suit,
action or proceeding arising out of or relating to this Agreement and (ii)
hereby waives, and agrees 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. Each of the Company and
the Purchaser consents to process being served in any such suit, action or
proceeding by overnight or registered mail, return receipt, 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 shall affect or limit any right to
serve process in any other manner permitted by law.
SECTION 9.3 ENTIRE AGREEMENT; AMENDMENT. This Agreement contains the
entire understanding of the parties with respect to the matters covered hereby
and, except as specifically set forth herein, neither the Company nor the
Purchaser makes any representations, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived or amended
other than by a written instrument signed by the party against whom enforcement
of any such amendment or waiver is sought.
SECTION 9.4 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 telex (with correct answer
back received), 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: Cytogen Corporation
000 Xxxxxxx Xxxx Xxxx XX 0000
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Attention: Chief Executive Officer
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With copies to: Xxxxxxxx Xxxxxxxxx
000 Xxxxxxx Xxxx Xxxx, 0xx Xxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
If to the Purchaser: Acqua Wellington North American Equities Fund, Ltd.
c/o Fortis Fund Services (Bahamas) Ltd.
Xxxxxxxx Xxxxxxxx Centre
East Bay Street, P. O. Box SS-6238
Nassau, Bahamas
Tel. No: (000) 000-0000
Fax No.: (000) 000-0000
Attention: Xxxxxxx X.X. Xxxxx Xxxxxx
With copies to: Xxxxxx Xxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Tel. No: (000) 000-0000
Fax No: (000)000-0000
Attention: Xxxxxxxxxxx X. Xxxxxxx, Esq.
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 9.5 WAIVERS. No waiver by either 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 provisions,
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 9.6 HEADINGS. 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.
SECTION 9.7 SUCCESSORS AND ASSIGNS. The Purchaser may not assign this
Agreement to any person without the prior consent of the Company, which consent
will not be unreasonably withheld. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and assigns. The
parties hereto may not amend this Agreement or any rights or obligations
hereunder without the prior written consent of the Company and each Purchaser to
be affected by the amendment. After Closing, the assignment by a party to this
Agreement of any rights hereunder shall not affect the obligations of such party
under this Agreement.
-26-
SECTION 9.8 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York, without
giving effect to the choice of law provisions.
SECTION 9.9 SURVIVAL. The representations and warranties of the Company
and the Purchaser contained in Article III and the covenants contained in
Article IV shall survive the execution and delivery hereof and the Closing until
the termination of this Agreement, and the agreements and covenants set forth in
Article VIII of this Agreement shall survive the execution and delivery hereof
and the Closing hereunder.
SECTION 9.10 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. In the event any signature is
delivered by facsimile transmission, the party using such means of delivery
shall cause four additional executed signature pages to be physically delivered
to the other parties within five days of the execution and delivery hereof.
SECTION 9.11 PUBLICITY. Except as required by law, the Company shall not
issue any press release or otherwise make any public statement or announcement
with respect to this Agreement or the transactions contemplated hereby or the
existence of this Agreement without the prior written consent of the Purchaser.
In the event the Company is required by law to issue a press release or
otherwise make a public statement or announcement with respect to this Agreement
or the transaction contemplated hereby, the Company shall consult with the
Purchaser on the form and substance of such press release or other disclosure.
SECTION 9.12 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.
SECTION 9.13 FURTHER ASSURANCES. From and after the date of this
Agreement, upon the request of the Purchaser or the Company, as the case may be,
each of the Company and the Purchaser shall execute and deliver such instrument,
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.
[END OF PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officer as of the date first above
written.
CYTOGEN CORPORATION
By: /s/ H. Xxxxxx Xxxxxx
-------------------------------
Name: H. Xxxxxx Xxxxxx
Title: President and Chief Executive
Officer
ACQUA WELLINGTON NORTH AMERICAN
EQUITIES FUND, LTD.
By: /s/ Xxxxxxx X. X. Xxxxx Xxxxxx
-------------------------------
Name: Xxxxxxx X.X. Xxxxx Xxxxxx
Title: Director
-28-
EXHIBIT A TO THE
COMMON STOCK PURCHASE AGREEMENT
OPINION OF COUNSEL
[LETTERHEAD OF ]
-------------------------
[FORM OF COMPANY'S COUNSEL OPINION]
1. The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware. The Company has the
requisite corporate power to own and operate its properties and assets, and to
carry on its business as presently conducted. Each of the Company and its
subsidiaries is duly qualified to do business as a foreign corporation 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 in which the failure to be so qualified will not have Material
Adverse Effect.
2. The Company has the requisite corporate power and authority to enter
into and perform its obligations under the Purchase Agreement and to issue and
sell the Common Stock. The execution, delivery and performance of the Purchase
Agreement 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 or stockholders is required. The Purchase Agreement has been
duly executed and delivered by the Company and the Purchase Agreement
constitutes a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms. The Common Stock is not
subject to preemptive rights under the Company's Charter or By-Laws.
3. The Shares have been duly authorized and, when delivered against
payment in full as provided in the Purchase Agreement, will be validly issued,
fully paid and nonassessable. Assuming the Shares are issued pursuant to an
effective registration statement and any required prospectus supplement is filed
and delivered as required by the Securities Act, the issuance and sale of the
Shares to the Purchaser will not violate Section 5 of the Securities Act.
4. The execution, delivery and performance of and compliance with the
terms of the Purchase Agreement and the consummation by the Company of the
transactions contemplated thereby (i) do not violate any provision of the
Company's Charter or By-Laws, (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 material agreement, mortgage, deed of trust, indenture,
note, bond, license, lease agreement, instrument or obligation to which the
Company is a party, (iii) create or impose a lien, charge or encumbrance on any
property of the Company under any agreement or any commitment 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 (iv) result in a violation of any
federal, state or local statute, rule, regulation, order, judgment or decree
(including federal 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 are bound or affected, except, (in all cases other than
violations pursuant to clause (i) above and clause (iv) to the extent of federal
securities laws and regulations) for such conflicts, defaults, terminations,
amendments, acceleration, cancellations and violations as would not,
individually or in the aggregate, have a Material Adverse Effect.
5. There is no action, suit, claim, investigation or proceeding pending or
threatened against the Company or any subsidiary which questions the validity of
this Agreement or the transactions contemplated hereby or any action taken or to
be taken pursuant hereto or thereto. There is no action, suit, claim,
investigation or proceeding pending or, threatened, against or involving the
Company, any subsidiary or any of their respective properties or assets and
which, if adversely determined, is reasonably likely to result in a Material
Adverse Effect.
6. No consent, approval or authorization of or designation, declaration or
filing with any governmental authority on the part of the Company is required in
connection with the valid execution and delivery of the Purchase Agreement, or
the offer, sale or issuance of the Shares or the consummation of any other
transaction contemplated by the Purchase Agreement (other than any filings which
may be required to be made by the Company with the Commission, the Nasdaq Stock
Market subsequent to the Closing, and, any registration statement which may be
filed pursuant to the Purchase Agreement).
7. The Registration Statement has been declared effective under the
Securities Act and, to our knowledge, no stop order suspending its effectiveness
has been issued and no proceedings for that purpose have been, to our knowledge,
instituted or are pending or threatened before or contemplated by the
Commission.
EXHIBIT B
TO THE COMMON STOCK PURCHASE AGREEMENT
SECRETARY'S CERTIFICATE
, 2000
---------
The undersigned, , Secretary of Cytogen Corporation, a
Delaware corporation (the "Company"), delivers this certificate in connection
with the issuance and sale of shares of common stock of the Company in an
aggregate amount of $ to Acqua Wellington North American Equities
Fund, Ltd. (the "Purchaser") pursuant to the Common Stock Purchase Agreement,
dated , 2000 (the "Agreement"), by and among the Company and the
Purchaser, and hereby certifies on the date hereof, that (capitalized terms used
herein without definition have the meanings assigned to them in the Agreement):
1. Attached hereto as Exhibit A is a true, complete and correct copy of
the Restated Certificate of Incorporation of the Company as filed with the
Secretary of State of the State of . The Certificate of Incorporation
of the Company has not been further amended or restated, and no document with
respect to any amendment to the Restated Certificate of Incorporation of the
Company has been filed in the office of the Secretary of State of the State of
since , 2000, the date shown on the face of the state
certification relating to the Company's Restated Certificate of Incorporation,
which is in full force and effect on the date hereof, and no action has been
taken by the Company in contemplation of any such amendment or the dissolution,
merger or consolidation of the Company.
2. Attached hereto as Exhibit B is a true and complete copy of the Amended
and Restated By-laws of the Company, as amended and restated through, and as in
full force and effect on, the date hereof, and no proposal for any amendment,
repeal or other modification to the By-laws of the Company has taken or is
currently pending before the Board of Directors or stockholders of the Company.
3. Attached hereto as Exhibit C is a true and correct copy of all written
actions and resolutions of the Board of Directors (including any committees
thereof) of the Company relating to the transactions contemplated by the
Agreement; said actions and resolutions have not been amended, rescinded or
modified since their adoption and remain in full force and effect as of the date
hereof; said actions and resolutions are the only resolutions adopted by the
Board of Directors of the Company, or any committee thereof, pertaining to (A)
the offering of the Common Stock to be sold by the Company pursuant to the
Agreement, (B) the execution and delivery of the Agreement and (C) all other
transactions in connection with the foregoing.
4. Each person who, as an officer of the Company, or as attorney-in-fact
of an officer of the Company, signed the Agreement and any other document
delivered prior hereto or on the date hereof in connection with the transactions
contemplated by the Agreement, was duly elected, qualified and acting as such
officer or duly appointed and acting as such attorney-in-fact, and the signature
of each such person appearing on any such document is his genuine signature.
5. The Agreement as executed and delivered on behalf of the Company
has been approved by the Company.
6. The actions, resolutions and other records of the Company relating to
all of the proceedings of the Stockholders of the Company, the Board of
Directors of the Company and any committees thereof made available to the
Purchasers and their counsel are the true, correct and complete copies thereof,
with respect to all proceedings of said Stockholders, Board of Directors and
committees thereof. Such records and other documents of the Company made
available to the Purchasers and their counsel were true and complete in all
respects. There have been no material changes, additions or alterations in said
records and other documents that have not been disclosed to the Purchasers.
IN WITNESS WHEREOF, I have signed my name as of the date first above
written.
By:
---------------------------
Name:
Title: Secretary
I, , Chief Executive Officer of Cytogen Corporation, do
hereby certify that is the duly elected, qualified and
acting Secretary of the above mentioned company, and that the signature set
forth above is her true and genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name as of the date first
above written.
By:
---------------------------
Name:
Title: Chief Executive Officer
EXHIBIT C
TO THE COMMON STOCK PURCHASE AGREEMENT
COMPLIANCE CERTIFICATE
In connection with the issuance of shares of common stock of Cytogen
Corporation, a Delaware corporation (the "Company"), pursuant to the Draw Down
Notice, dated delivered by the Company to Acqua Wellington North
American Equities Fund, Ltd. (the "Purchaser") pursuant to Article VI of the
Common Stock Purchase Agreement dated , by and between the
Company and Acqua Wellington North American Equities Fund, Ltd. (the
"Agreement"), the undersigned hereby certifies as follows:
1. The undersigned is the duly elected Chief [Executive/Financial] Officer
of the Company.
2. The representations and warranties of the Company set forth in Section
3.1 of the Agreement are true and correct in all material respects as though
made on and as of the date hereof, except for representations and warranties
that speak as of a particular date.
3. The Company has performed in all material respects all covenants and
agreements to be performed by the Company on or prior to the Draw Down Exercise
Date and the Settlement Date related to the Draw Down Notice and has complied in
all material respects with all obligations and conditions contained in Section
5.3 of the Agreement.
Capitalized terms used but not otherwise defined herein shall have the
meanings assigned to them in the Agreement.
The undersigned has executed this Certificate this day of ,
2000.
By:
---------------------------
Name:
-------------------------
Title:
------------------------
EXHIBIT D
TO THE COMMON STOCK PURCHASE AGREEMENT
FORM OF DRAW DOWN NOTICE
Reference is made to the Common Stock Purchase Agreement dated as of
, (the "Purchase Agreement") between Cytogen Corporation, a
Delaware corporation (the "Company"), and Acqua Wellington North American
Equities Fund, Ltd. Capitalized terms used and not otherwise defined herein
shall have the meanings given such terms in the Purchase Agreement.
In accordance with and pursuant to Section 6.1 of the Purchase Agreement,
the Company hereby issues this Draw Down Notice to exercise a Draw Down request
for the Draw Down Amount indicated below.
Draw Down Amount:
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Call Option Amount:
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Draw Down Pricing Period start date:
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Draw Down Pricing Period end date:
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Settlement Date:
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Threshold Price:
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Minimum Threshold Price:
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Dollar Amount and/or Number of Shares
of Common Stock Currently Unissued
under the Registration Statement:
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Dated:
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By:
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Name:
Title:
Address:
Facsimile No.:
Wire Instructions:
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Contact Name:
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Receipt Acknowledged:
Acqua Wellington North American Equities Fund, Ltd.
By:
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Name:
Title:
EXHIBIT E
TO THE COMMON STOCK PURCHASE AGREEMENT
FORM OF CALL OPTION NOTICE
To:
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Fax #:
Reference is made to the Common Stock Purchase Agreement dated as of
, (the "Purchase Agreement") between Cytogen Corporation, a
Delaware corporation (the "Company"), and Acqua Wellington North American
Equities Fund, Ltd. Capitalized terms used and not otherwise defined herein
shall have the meanings given such terms in the Purchase Agreement.
In accordance with and pursuant to Section 6.2 of the Purchase Agreement,
the Purchaser hereby issues this Call Option Notice to exercise a Call Option
for the Call Option Amount indicated below.
Call Option Amount Exercised:
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Number of Shares to be purchased:
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VWAP on the date hereof:
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Draw Down Discount Percentage:
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Settlement Date:
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Threshold Price:
--------------------------------------
Minimum Threshold Price:
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Dated:
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Acqua Wellington North American Equities Fund, Ltd.
By:
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Name:
Title:
