FORM OF SECURITIES PURCHASE AGREEMENT
Exhibit 4.81
This
SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of
May 13, 2008, is made by and among Amarin Corporation plc, a company
incorporated under the laws of England and Wales (the “Company”), and the purchasers
listed on Exhibit
A hereto,
together with their permitted transferees (each, a “Purchaser” and collectively,
the “Purchasers”).
RECITALS:
A. The
Company and the Purchasers are executing and delivering this Agreement in
reliance upon the exemption from the registration requirements of the Securities
Act afforded by Section 4(2) thereof and/or Regulation D
thereunder.
B. The
Purchasers desire to purchase and the Company desires to sell, upon the terms
and conditions stated in this Agreement, Shares and Preference Shares in an
aggregate amount of $56,000,000, with $28,000,000 (the “First Closing Amount”) to be
funded at the first closing (the “First Closing”) and
$28,000,000 (the “Second
Closing Amount”) to be funded at the second closing (the “Second Closing”) if the Second
Closing occurs.
C. The
capitalized terms used herein and not otherwise defined have the meanings given
them in Article 8.
AGREEMENT
In
consideration of the premises and the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Purchasers (severally and not jointly)
hereby agree as follows:
ARTICLE
1
PURCHASE
AND SALE OF SECURITIES
|
SECTION
1.1.
|
Purchase and Sale of
Securities.
|
(a) At the
First Closing, the Company will allot, issue and sell to each Purchaser, and
each Purchaser will subscribe for from the Company, the number of Preference
Shares, if any, (the “Preference Shares”) and the
number of Ordinary Shares (the “First Closing Ordinary Shares”
and together with the Preference Shares, the “First Closing Securities”), each Ordinary
Share represented by one American Depositary Share (each, an “ADS” and collectively, “ADSs”), in each case as set
forth opposite such Purchaser’s name on Exhibit
A hereto. The purchase or subscription price for each unit of
the First Closing Securities shall be US$2.30 (the “Per Share First Closing Purchase
Price”) of which the dollar amount equivalent to ₤0.50 per Preference
Share on the First Closing Date shall be paid in respect of each Preference
Share purchased, if any.
(b) The
Purchasers will have the option to invest the Second Closing Amount as provided
herein. If the Purchasers, in accordance with Section 1.1(c), elect
to invest the Second
CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS (*) DENOTE SUCH OMISSIONS.
WITH THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS (*) DENOTE SUCH OMISSIONS.
Closing
Amount, then at the Second Closing, the Company will allot, issue and sell to
each Purchaser, and each Purchaser will subscribe for from the Company the
number of Ordinary Shares (the “Second Closing Securities” and, together with
the First Closing Securities, the “Securities”), each Ordinary
Share represented by one ADS, that is equal to the quotient obtained by
dividing (A)
the product of
(x) the Second Closing Amount and (y) such
Purchaser’s “Pro Rata Percentage” as set forth opposite such Purchaser’s name on
Exhibit
A hereto, by (B) the Per Share
Second Closing Purchase Price (as defined below).
The “Per Share Second Closing Purchase
Price” shall mean the purchase or subscription price for each Second
Closing Security equal to the lesser of (i) $2.60 and (ii) the product of (x) the
average of the volume weighted average prices as published on the HP screen on
Bloomberg of the ADSs as reported on Nasdaq (symbol “AMRN”) for each of the
thirty (30) trading days immediately prior to the Second Closing Date and (y)
1.13.
(c) Not later
than the tenth (10th) Business Day following the date on which the Company
notifies the Purchasers in writing (the “Notice”) of its good faith
determination, which shall have been confirmed by the affirmative vote of at
least a majority of all the members of the Board of Directors plus one
additional Director (the “Supermajority Directors”),
that either (i) it believes the Milestone has been achieved (in which case the
Company shall provide the Purchasers with supporting documentation) or (ii) it
has permanently ceased to pursue achievement of the Milestone, the Purchasers
will vote on whether to exercise their option to fund the Second Closing
Amount. If a Majority of the Preference Share Purchasers vote in
favor of such exercise, then each Purchaser shall be required to fund in full
its Pro Rata Percentage of the Second Closing Amount at the Second Closing;
provided, that if,
after such vote, any Purchaser funds less than such Purchaser’s full Pro Rata
Percentage of the Second Closing Amount (such unfunded amount shall be referred
to herein as a “Shortfall
Amount”), then, (A) upon consummation of the Second Closing, all
Preference Shares held by such Purchaser shall immediately convert into Ordinary
Shares in accordance with their terms, and (B) the Purchasers that fund their
full Pro Rata Percentages of the Second Closing Amount at the Second Closing
shall have the right, but not the obligation, to fund any Shortfall Amount (in
such proportions as such participating Purchasers shall determine in their sole
discretion) and acquire the Second Closing Securities in respect of the amount
funded. If, at the time of such vote, a Majority of the Preference
Share Purchasers do not vote in favor of such exercise, then the Purchasers’
option to fund the Second Closing Amount will expire and be of no further force
or effect. Notwithstanding any provision hereof to the contrary, a
Majority of the Preference Share Purchasers may elect by written notice to the
Company to waive the Notice and consummate the Second Closing at any time prior
to delivery to the Purchasers of the Notice.
(d) The Per
Share Second Closing Purchase Price and/or the number of Second Closing
Securities issuable upon funding of the Second Closing Amount will be subject to
adjustment in the event of (i) stock splits, stock dividends and similar events,
and (ii) issuances of Ordinary Shares (including as ADSs), securities
convertible into Ordinary Shares or ADSs, warrants to subscribe for Ordinary
Shares or ADSs, or options to purchase any of the foregoing, exclusive however
of Exempt Securities (“Additional Stock”), at a price
per share that is less than, or with a conversion or exercise price that is less
than, the Per Share Second Closing Purchase Price. In the case of
clause (i), in the event of changes in the outstanding Ordinary Shares, on or
after the First Closing Date, by reason of a stock split, reverse stock split,
stock dividend, subdivision, split-up, combination of shares, consolidation or
other transaction having similar effect, the number of Second Closing Securities
purchasable under this Agreement in the aggregate and the Per Share Second
Closing Purchase Price shall be correspondingly adjusted to give
each
-2-
Purchaser,
on exercise of the option related to the Second Closing for the same aggregate
Second Closing Purchase Price, the total number of Second Closing Securities as
such Purchaser would have owned had the Second Closing been consummated prior to
the event requiring adjustment and had such Purchaser continued to hold such
Securities until after such event. In the case of clause (ii), the
provisions of Exhibit
B hereto shall apply.
SECTION
1.2. Payment. At or
prior to the First Closing, each Purchaser will pay the aggregate First Closing
Purchase Price for the First Closing Securities as set forth opposite such
Purchaser’s name on Exhibit
A hereto (the “First
Closing Purchase Price”) by wire transfer of immediately available funds
to the Company in accordance with wire instructions provided by the Company to
the Purchasers prior to the First Closing. Upon such wire transfer
the Company will instruct its depositary to deliver to each Purchaser, on an
expedited basis, a statement of account in the name of such Purchaser reflecting
the number of First Closing Ordinary Shares set forth on Exhibit
A and will deliver certificates evidencing the Preference Shares set
forth on Exhibit
A. In the event of the Second Closing, in accordance with and
subject to Section 1.1(b) hereof, substantially identical payment and delivery
procedures will apply with respect to the aggregate price payable hereunder by
each Purchaser for the Second Closing Securities (the “Second Closing Purchase
Price”). The First Closing Purchase Price and the Second
Closing Purchase Price include costs of issuance, such as any stamp duty or
stamp duty reserve tax with respect thereto or any other cost incurred by the
Company in connection with the issuance of the Securities.
SECTION
1.3. Closing Date. The
First Closing will take place on May 16, 2008, or on such other date as shall be
agreed upon by the Company and a Majority of the Preference Share Purchasers
(the date upon which the First Closing occurs shall be referred to herein as the
“First Closing
Date”). The First Closing will be held at the offices of
Xxxxxx Xxxxxx & Xxxxxxx llp, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at
such other place as shall be agreed upon by the Company and a Majority of the
Preference Share Purchasers. If a Majority of the Preference Share
Purchasers vote in favor of the Second Closing pursuant to Section 1.1(c), then
the Second Closing will take place no more than fifteen (15) Business Days
following such affirmative vote (the “Second Closing
Date”). The Second Closing, if applicable, will be held at the
offices of Xxxxxx Xxxxxx & Xxxxxxx llp, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 or at such other time and place as shall be agreed upon by the Company and
a Majority of the Preference Share Purchasers.
SECTION
1.4. Redemption of Convertible
Debentures. Pursuant to the Company’s Convertible Debentures
due 2010 (the “Debentures”), within fifteen
(15) days following the First Closing Date the Company will apply proceeds from
the First Closing Amount to, among other things, redeem for cash all outstanding
Debentures at a redemption price equal to 100% of the principal amount thereof,
plus any accrued and unpaid interest thereon up to and including the date upon
which the Debentures are redeemed. The principal amount of the
Debentures, as of the date hereof, is $2,750,000.
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
Except as
specifically contemplated by this Agreement or as set forth in the SEC
Documents, the Draft Annual Report or the Disclosure Schedules, which Disclosure
Schedules are attached hereto and shall be deemed a part hereof, the Company
hereby represents and warrants to each of the Purchasers and the Placement Agent
as follows:
-3-
SECTION
2.1. Organization and
Qualification. All of the direct and indirect Subsidiaries of
the Company are as disclosed in the Draft Annual Report. The Company
owns, directly or indirectly, all of the capital stock or other equity interests
of each Subsidiary free and clear of any Liens, and all the issued and
outstanding shares of capital stock of each Subsidiary are validly issued and
are fully paid, non-assessable and free of preemptive and similar rights to
subscribe for or purchase securities. The Company is duly
incorporated and validly existing under the laws of England and Wales, with the
requisite power and authority to own and use its properties and assets and to
carry on its business as currently conducted. Neither the Company nor
any Subsidiary is in violation or default of any of the provisions of its
respective certificate or articles of incorporation, bylaws or other
organizational or charter documents. The Company is duly qualified to
conduct business as a foreign corporation in each United States jurisdiction in
which the nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, could not reasonably be expected to have (i) a
material adverse effect on the legality, validity or enforceability of this
Agreement and the transactions contemplated hereby, (ii) a material adverse
effect on the results of operations, assets, business, or financial condition of
the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely
basis its obligations under this Agreement and the transactions contemplated
hereby (any of (i), (ii) or (iii), a “Material Adverse Effect”), and
no Proceeding has been instituted in any such jurisdiction revoking, limiting or
curtailing or seeking to revoke, limit or curtail such power and authority or
qualification. Each Subsidiary is duly incorporated or otherwise
organized and validly existing under the laws of the jurisdiction of its
incorporation or organization (as applicable), with the requisite power and
authority to own and use its properties and assets and to carry on its business
as currently conducted. Each Subsidiary is duly qualified to conduct
business as a foreign corporation or other entity in each United States
jurisdiction in which the nature of the business conducted or property owned by
it makes such qualification necessary, except where the failure to be so
qualified or in good standing, as the case may be, could not reasonably be
expected to have a Material Adverse Effect.
SECTION
2.2. Authorization;
Enforcement. The Company has the requisite corporate power and
authority to enter into and to consummate this Agreement and the transactions
contemplated hereby and otherwise to carry out its obligations hereunder and
thereunder. The execution and delivery of this Agreement by the
Company and the consummation by it of the transactions contemplated hereby have
been duly authorized by all necessary action on the part of the Company and no
further action is required by the Company, its Board of Directors or its
shareholders in connection therewith other than in connection with the Required
Approvals. This Agreement has been (or upon delivery will have been)
duly executed by the Company and, when delivered in accordance with the terms
hereof, will constitute the valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) rights
to indemnity and contribution may be limited by applicable law or public
policy.
SECTION
2.3. Capitalization. The
capitalization of the Company is as set forth in Schedule 2.3 of the Disclosure
Schedules. All of the issued shares of capital stock of the Company
are validly issued and fully paid. Except as a result of the purchase
and sale of the Securities and as set forth in the SEC Documents, the Draft
Annual Report and Schedule 2.3, there are no outstanding options, warrants,
rights to subscribe for, or securities, rights or obligations convertible into,
or giving
-4-
any
person any right to subscribe for or acquire, any Ordinary Shares or any
options, warrants, rights or other instruments convertible into or exchangeable
for Ordinary Shares. The Company’s Memorandum of Association and
Articles of Association (the “Memorandum and Articles of
Association”), as in effect on the date hereof, have previously been
provided to the Purchasers. There are no shareholders agreements,
voting agreements or other similar agreements with respect to the Company’s
capital stock to which the Company is a party or, to the knowledge of the
Company, between or among any of the Company’s shareholders. Schedule
2.3 of the Disclosure Schedules contains a true, correct and complete copy of
the Company’s 2002 Stock Option Plan, as amended by that certain Amendment to
2002 Stock Option Plan dated May 9, 2008 (collectively, the “Amended Plan”), which Amended
Plan is in full force and effect. No option or award issued under or
pursuant to the Amended Plan will vest, and the vesting schedule of any
outstanding option or award will not accelerate, as a result of the transactions
contemplated hereby. The Company has not back-dated any of its
options or awards issued under or pursuant to the Amended Plan, or
otherwise.
SECTION
2.4. Issuance of
Securities. The Securities (in connection with both the First
Closing and the Second Closing) are within the authorized share capital of the
Company and, upon issuance in accordance with the terms of this Agreement, will
be validly issued and fully paid and, except for antidilution adjustments
described in Schedule 2.4 of the Disclosure Schedules, will not be subject to
preemptive rights or other similar rights of shareholders of the
Company.
SECTION
2.5. No Conflicts; Government Consents and
Permits.
(a) The
execution, delivery and performance of this Agreement by the Company and the
consummation by the Company of the transactions contemplated hereby (including
the issuance of the Securities) will not (i) conflict with or result in a
violation of any provision of its Memorandum and Articles of Association, (ii)
violate or conflict with, result in a material breach of any provision of,
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, result in the creation of any Lien upon any of
the properties or assets of the Company or any Subsidiary, or give to others any
rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, indenture or instrument to
which the Company or any of its Subsidiaries is a party, or (iii) subject to
receipt of Required Approvals, result in a violation of any applicable law,
rule, regulation, order, judgment or decree (including United States federal and
state securities laws and regulations and regulations of any self-regulatory
organizations to which the Company or its securities are subject) applicable to
the Company or any of its Subsidiaries, except in the case of clauses (ii) and
(iii) only, for such conflicts, breaches, defaults, and violations as would not
reasonably be expected to have a Material Adverse Effect.
(b) Assuming
the accuracy of each of the Purchasers’ representations and warranties in
Article 3 hereof, the Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any
Governmental Authority or other Person in order for it to execute, deliver or
perform any of its obligations under this Agreement in accordance with the terms
hereof, or to issue and sell the Securities in accordance with the terms hereof,
other than such as have been made or obtained, and except for (i) the
registration of the Securities under the Securities Act pursuant to Article 6
hereof, (ii) such filings required to be made under English law or U.S. federal
or state or foreign securities laws as set forth on Schedule 2.5 of the
Disclosure Schedules, and (iii) such required filings or notifications regarding
the issuance or listing of additional shares with Nasdaq as set forth on
Schedule 2.5 (collectively, the “Required
Approvals”).
-5-
(c) The
Company and each Subsidiary has all certificates, authorizations, permits,
licenses and any similar authority necessary for the conduct of its business as
now being conducted by it as described in the Draft Annual Report, except for
such certificates, authorizations, permits, licenses or similar authority, the
lack of which would not reasonably be expected to have a Material Adverse Effect
(“Material
Permits”). Neither the Company nor any of its Subsidiaries has
received any actual notice of any proceeding relating to revocation or
modification of any Material Permit.
SECTION
2.6. SEC Documents; Financial
Statements. The Company has complied in all material respects
with requirements to file all reports required to be filed by it under the
Exchange Act for the preceding two years (all of the foregoing and all exhibits
included therein and financial statements and schedules thereto and documents
(other than exhibits) incorporated by reference therein being hereinafter
referred to as the “SEC
Documents”) on a timely basis or has received a valid extension of such
time of filing and has filed any such SEC Document prior to the expiration of
any such extension. At the time of filing, the SEC Documents complied
in all material respects with the applicable requirements of the Exchange
Act. At the time of filing, the Financial Statements and the related
notes complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto. Such Financial Statements have been prepared in accordance
with United States generally accepted accounting principles (“GAAP”) applied on a consistent
basis during the periods involved (the Financial Statements are prepared under
U.K. GAAP and reconciled to U.S. GAAP), except as may be otherwise specified in
such Financial Statements or the notes thereto and except that unaudited
financial statements may not be reconciled to U.S. GAAP or contain all footnotes
required by GAAP, and fairly present in all material respects the financial
position of the Company and its consolidated Subsidiaries as of and for 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, immaterial,
year-end audit adjustments.
SECTION
2.7. Annual Report for
2007. The Company has previously made available to the
Purchasers a draft, which was delivered to the Purchasers by the Placement Agent
on April 18, 2008, of the Company’s Annual Report on Form 20-F for the fiscal
year ended December 31, 2007 (the “Draft Annual Report”), which
has been prepared assuming the First Closing occurs subsequent to the period
covered thereby but before the filing thereof with the SEC. At the
time of filing, the Draft Annual Report will comply in all material respects
with the applicable requirements of the Exchange Act. The Financial
Statements contained in the Draft Annual Report and the related notes comply as
to form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto. Such
Financial Statements have been prepared in accordance with International
Financial Reporting Standards applied on a consistent basis during the periods
involved, except as may be otherwise specified in such Financial Statements or
the notes thereto and fairly present in all material respects the financial
position of the Company and its consolidated Subsidiaries as of and for 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, immaterial,
year-end audit adjustments. As of the date hereof, the Draft Annual
Report does 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 the light of the circumstances under which they were
made, not misleading.
-6-
SECTION
2.8. Absence of
Litigation. Except as described or referred to in the SEC
Documents, the Draft Annual Report or Schedule 2.8 of the Disclosure Schedules,
there is no Proceeding pending or, to the knowledge of the Company, threatened
against or affecting the Company, any Subsidiary or any of their respective
properties before or by any court, arbitrator, governmental or administrative
agency or regulatory authority (federal, state, county, local or foreign) which
(i) adversely affects or challenges the legality, validity or enforceability of
any of the Securities, this Agreement or the transactions contemplated hereby or
(ii) could, if there were an unfavorable decision, reasonably be expected to
result in a Material Adverse Effect. Except as described or referred
to in the SEC Documents, the Draft Annual Report or Schedule 2.8 of the
Disclosure Schedules, there has not been, and to the knowledge of the Company,
there is not pending or contemplated, any investigation by any Governmental
Authority involving the Company or any Subsidiary regarding the business,
operations, activities or securities of the Company. The SEC has not
issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company or any Subsidiary under the Exchange
Act or the Securities Act.
SECTION
2.9. Intellectual Property
Rights. The Company and each Subsidiary owns, or has
sufficient rights worldwide to use, all patents and patent applications
(including reissues, divisions, continuations, continuations-in-part,
extensions, reexaminations and foreign counterparts thereof), trademarks,
trademark applications, service marks, trade names, copyrights, trade secrets
and know-how, including unpatented inventions, licenses for any of the foregoing
and other intellectual property rights listed on Schedule 2.9 of the Disclosure
Schedule (collectively, the “Intellectual Property
Rights”). To the Company’s best knowledge (after diligent
inquiry), there are no other intellectual property rights used in or necessary
or material for use in connection with the Company’s and its Subsidiaries’
respective businesses as currently being conducted as described in the SEC
Documents and the Draft Annual Report. Except as set forth in
Schedule 2.9, all of the Intellectual Property Rights owned by the Company
or any Subsidiary are exclusively owned by the Company or a Subsidiary and are
free and clear of all Liens. Schedule 2.9 (a) of the Disclosure
Schedule sets forth a complete and accurate list of all patents, registered
trademarks and registered copyrights owned by the Company or any Subsidiary, in
any jurisdiction throughout the world, and all applications for the foregoing;
and Schedule 2.9 (b) sets forth a list of all agreements under which the Company
or any Subsidiary receives from or grants to any Person any Intellectual
Property Rights, other than off-the-shelf, shrink-wrap or click-wrap software
licenses. There are no Proceedings, including without limitation any
interference, reissue, reexamination, opposition, cancellation or similar
proceedings, which adversely affect or challenge the legality, validity, use or
enforceability of any of the Intellectual Property Rights. Neither
the Company nor any Subsidiary has received any written notice, including any
offers to license the intellectual property of any Person, or opinion of counsel
that, and the Company has no knowledge of any facts or circumstances or any
other reason to believe that, the use of the Intellectual Property Rights by the
Company or any Subsidiary violates or infringes or is alleged to violate or
infringe upon the rights of any Person. None of the Intellectual
Property Rights have been judged invalid or unenforceable in whole or in part by
any jurisdiction throughout the world and except as set forth in the Draft
Annual Report, to the knowledge of the Company, all of the Intellectual Property
Rights are valid and enforceable. All of the registrations and
pending applications for Intellectual Property Rights have been timely and duly
filed and prosecuted, all maintenance and related fees have been paid, and the
Company or its Subsidiaries have taken all other actions required to maintain
the validity and effectiveness of such registrations and
applications. To the knowledge of the Company, there has been no
infringement or misappropriation by another Person of any of the Intellectual
Property Rights. The Company has taken reasonable measures consistent
with industry standards to protect and
-7-
maintain
the confidentiality of its trade secrets and other confidential Intellectual
Property Rights. Each present or past employee, officer, consultant
or any other Person who developed, in whole or in part, any Intellectual
Property Rights owned or purported to be owned by the Company or any of its
Subsidiaries has executed a valid and enforceable assignment to the Company of
all right, title and interest in such Intellectual Property Rights.
SECTION
2.10. Certain
Fees. Except for fees payable by the Company pursuant to the
Company’s engagement letter with the Placement Agent, no brokerage or finder’s
fees or commissions are or will be payable by the Company to any broker,
financial advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated by this
Agreement. The Purchasers shall have no obligation with respect to
any fees or with respect to any claims made by or on behalf of other Persons for
fees of a type contemplated in this Section that may be due in connection with
the transactions contemplated by this Agreement.
SECTION
2.11. Investment
Company. The Company is not and, after giving effect to the
offering and sale of the Securities, will not be an “investment company” as such
term is defined in the Investment Company Act of 1940, as amended (the “Investment Company
Act”). The Company shall conduct its business in a manner so
that it will not become subject to the Investment Company Act.
SECTION
2.12. No Material Adverse
Effect. Since September 30, 2007, except as described or
referred to in the Draft Annual Report and except for cash expenditures in the
ordinary course of business consistent with past practice, there has not been
any change in the assets, business, properties, financial condition or results
of operations of the Company that would reasonably be expected to have a
Material Adverse Effect. Since September 30, 2007, except as
described or referred to in the Draft Annual Report, (i) there has not been any
dividend or distribution of any kind declared, set aside for payment, paid or
made by the Company on any class of capital stock, (ii) the Company has not
sustained any material loss or interference with the Company’s business from
fire, explosion, flood or other calamity, whether or not covered by insurance,
or from any labor disturbance or dispute or any action, order or decree of any
court or arbitrator or governmental or regulatory authority, and (iii) the
Company has not incurred any material liabilities except in the ordinary course
of business consistent with past practice.
SECTION
2.13. Nasdaq Capital
Market. The ADSs are listed on the Nasdaq Capital Market and,
to the Company’s knowledge, there are no proceedings to revoke or suspend such
listing. The Company is, and after giving effect to the transactions
contemplated hereby will be, in compliance with the requirements of Nasdaq
Capital Market and the Company has not been notified by its depositary bank of,
nor is it aware of, any breach of the terms of its ADS depositary agreement in
the last two (2) years.
SECTION
2.14. Acknowledgment Regarding Purchasers’
Purchase of Securities. The Company acknowledges and agrees that each
Purchaser is acting solely in the capacity of an arm’s-length purchaser with
respect to this Agreement and the transactions contemplated
hereby. The Company further acknowledges that no Purchaser is acting
as a financial advisor or fiduciary of the Company (or in any similar capacity
with respect to the Company) with respect to this Agreement and the transactions
contemplated hereby and any advice given by any Purchaser or any of its
respective representatives or agents to the Company in connection with this
Agreement and the transactions contemplated hereby is merely incidental to such
Purchaser’s purchase of the Securities. The Company further
represents to each Purchaser that the Company’s decision to enter into
this
-8-
Agreement
has been based on the independent evaluation of the transactions contemplated
hereby by the Company and its representatives.
SECTION
2.15. Accountants. The
Company’s accountants are Pricewaterhouse-Coopers LLP. To the
knowledge of the Company, such accountants, who the Company expects will express
their opinion with respect to the financial statements to be included in the
Draft Annual Report as finalized and filed with the SEC promptly following the
First Closing, are a registered public accounting firm as required by the
Securities Act.
SECTION
2.16. Insurance. The
Company and each Subsidiary are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as the Company
believes are prudent and customary for a company (i) in the business (currently
limited to the clinical trial stage) and locations in which the Company and each
Subsidiary are engaged and (ii) with the resources of the Company and each
Subsidiary, including, but not limited to, directors and officers insurance
coverage. The Company has not received any written notice that the
Company or any Subsidiary will not be able to renew its existing insurance
coverage as and when such coverage expires.
SECTION
2.17. Foreign Corrupt
Practices. Since January 1, 2004, neither the Company nor, to
the Company’s knowledge, any director, officer, agent, employee or other person
acting on behalf of the Company has, in the course of its actions for, or on
behalf of, the Company, (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses relating to
political activity; (ii) made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds; (iii)
violated or is in violation of in any material respect any provision of the U.S.
Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful
bribe, rebate, payoff, influence payment, kickback or other unlawful payment to
any foreign or domestic government official or employee.
SECTION
2.18. No Registration
Rights. No Person has the right to (i) prohibit the Company
from filing the Registration Statement or (ii) except as described or referred
to in the Draft Annual Report or Schedule 2.18 of the Disclosure Schedules,
require the Company to register any securities for sale under the Securities Act
by reason of the filing of the Registration Statement or
otherwise. The granting and performance of the registration rights
under this Agreement will not violate or conflict with, or result in a breach of
any provision of, or constitute a default under, any agreement, indenture or
instrument to which the Company or any Subsidiary is a party.
SECTION
2.19. Taxes. The Company
has filed (or has obtained an extension of time within which to file) all
necessary federal, state and foreign income and franchise tax returns and has
paid all taxes that are due and payable, except where the failure to so file or
the failure to so pay would not reasonably be expected to have a Material
Adverse Effect.
SECTION
2.20. Real and Personal
Property. Except as referred to or described in the Draft
Annual Report, the Company and each Subsidiary have good and marketable title
to, or have valid rights to lease or otherwise use, all items of real and
personal property that are material to the business of the Company and its
Subsidiaries, free and clear of all Liens, except those that (i) do not
materially interfere with the use of such property by the Company and its
Subsidiaries or (ii) would not reasonably be expected to have a Material Adverse
Effect.
SECTION
2.21. Application of Takeover
Protections. The Company and its Board of Directors have taken
all necessary action, if any, in order to render inapplicable any
control
-9-
share
acquisition, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under the Company’s
Memorandum and Articles of Association or the laws of England and Wales that is
or could become applicable as a result of the Purchasers and the Company
fulfilling their obligations or exercising their rights under this Agreement and
the transactions contemplated hereby, including without limitation as a result
of the Company’s issuance of the Securities and the Purchasers’ ownership of the
Securities. Without in any way limiting the foregoing, the Company
and the transactions to be effected at the First Closing and the Second Closing
are not subject to the UK Takeover Code and neither the Company nor any
Purchaser is required to obtain any consent, authorization or order of, or make
any filing or registration pursuant to the UK Takeover Code in order for it to
execute, deliver or perform any of its obligations under this Agreement in
accordance with the terms hereof, or to allot, issue and sell the Securities in
accordance with the terms hereof.
SECTION
2.22. No Manipulation of
Stock. The Company has not taken, nor will it take, directly
or indirectly, any action designed to stabilize or manipulate the price of the
ADSs or any security of the Company to facilitate the sale or resale of any of
the Securities.
SECTION
2.23. Related Party
Transactions. Except as set forth in the Draft Annual Report
or Section 2.23 of the Disclosure Schedules, neither the Company nor any
Subsidiary is presently a party to any transaction with any officer or director
of the Company, any member of such officer’s or director’s family or any entity
in which such officer, director or family member has a 5% or greater interest or is an
officer, director, trustee or partner, including any contract,
agreement or other arrangement providing for the furnishing of services,
providing for rental of real or personal property, or otherwise requiring
payments, other than (i) for payment of salary or consulting fees for services
rendered to the Company or a Subsidiary, (ii) reimbursement for expenses
incurred on behalf of the Company or a Subsidiary and (iii) other employee
benefits, including stock option agreements under any stock option plan of the
Company or a Subsidiary.
SECTION
2.24. Xxxxxxxx-Xxxxx. To
the Company’s knowledge, the Company is in material compliance with all
provisions of the Xxxxxxxx-Xxxxx Act of 2002 which are applicable to it or the
transactions contemplated herein.
SECTION
2.25. Solvency. Based on
the financial condition of the Company as of the First Closing Date after giving
effect to the receipt by the Company of the proceeds from the sale of the First
Closing Securities hereunder, (i) the Company’s fair saleable value of its
assets exceeds the amount that will be required to be paid on or in respect of
the Company’s existing debts and other liabilities (including known contingent
liabilities but excluding contingent liabilities relating to completed
acquisitions, including the acquisition of Laxdale Limited, Ester Neurosciences
Limited, the rights to an oral formulation of apomorphine and the rights to a
nanocrystal nasal formulation of lorazepam as described in Schedule 2.25 of the
Disclosure Schedules) as they mature and (ii) the current cash flow of the
Company, together with the proceeds the Company would receive, were it to
liquidate all of its assets, after taking into account all anticipated uses of
the cash, would be sufficient to pay all amounts on or in respect of its debt
when such amounts are required to be paid.
SECTION
2.26. Obligations on Pipeline
Candidates. Schedule 2.26 of the Disclosure Schedules contains
a true, correct and complete schedule of all licenses, collaboration agreements
and other binding agreements of any kind with third parties that require the
Company or any Subsidiary to (i) make any milestone, royalty and other
similar payments in excess of $100,000 in the aggregate for each such agreement
(each, a “Payment
Obligations”) or (ii) perform any product development work (pre-clinical
or clinical) or undertake any manufacturing (pilot or commercial)
-10-
requiring
expenditures in excess of $100,000 in the aggregate for each such agreement
(each, a “Work
Obligation”), with respect to any development/pipeline product,
development/pipeline compound or development/pipeline candidate (each, a “Product”) owned or licensed by
or to the Company or any of its Subsidiaries, including on such schedule (a) the
names of the Products, (b) the agreements or other documents that are the source
of the Payment Obligations and/or Work Obligations, naming the parties thereto,
(c) a description of the Work Obligations, the diligence standards for
performing the Work Obligations, and whether each such agreement may be
terminated at the Company’s option without liability and if not, the measure of
such liability if specified, (d) the milestones, developments, or events
that give rise to the Payment Obligations and Work Obligations, and (e) the
amounts of the Payment Obligations and whether such Payment Obligations may be
settled other than by the payment of cash.
ARTICLE
3
PURCHASERS’
REPRESENTATIONS AND WARRANTIES
Each
Purchaser represents and warrants to the Company, severally and not jointly,
with respect to itself and its purchase hereunder, that:
SECTION
3.1. Investment
Purpose. The Purchaser is purchasing the Securities for its
own account for investment and not with a present view toward the public sale or
distribution thereof and has no intention of selling or distributing any of such
Securities or any arrangement or understanding with any other Persons regarding
the sale or distribution of such Securities except in accordance with the
provisions of Article 6 or otherwise as would not result in a violation of the
Securities Act. The Purchaser will not, directly or indirectly,
offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to
buy, purchase or otherwise acquire or take a pledge of) any of the Securities
except in accordance with the provisions of Article 6 or otherwise pursuant to
and in accordance with the Securities Act.
SECTION
3.2. Purchaser
Status. At the time the Purchaser was offered the Securities,
it was, and at the date hereof it is, either (i) a “qualified institutional
buyer” as defined in Rule 144A(a) under the Securities Act, (ii) an
institutional “accredited investor” as defined in Rule 501(a)(1), (2) or (3)
under the Securities Act or (iii) a person who is not a “U.S. Person” (as
defined in Rule 902(k) under the Securities Act) (a “Non-US Person”).
SECTION
3.3. Reliance on
Exemptions. The Purchaser understands that the Securities are
being offered and sold to it in reliance upon specific exemptions from or
non-application of the registration requirements of United States federal and
state securities laws and that the Company is relying upon the truth and
accuracy of, and the Purchaser’s compliance with, the representations,
warranties, agreements, acknowledgments and understandings of the Purchaser set
forth herein in order to determine the availability of such exemptions and the
eligibility of the Purchaser to acquire the Securities.
SECTION
3.4. Information. The
Purchaser acknowledges that it has been afforded (i) the opportunity to ask such
questions as it has deemed necessary of, and to receive answers from,
representatives of the Company concerning the terms and conditions of the
offering of the Securities and the merits and risks of investing in the
Securities; (ii) access to such information about the Company and its financial
condition, results of operations, businesses, properties, management and
prospects as it believes to be sufficient to enable it to evaluate its
investment, including, without limitation, the Company’s SEC Documents, the
Draft Annual Report and the
-11-
Disclosure
Schedules; (iii) the opportunity to review the SEC Documents, the Draft
Annual Report and the Disclosure Schedules; and (iv) the opportunity to
obtain such additional information that the Purchaser has requested and the
Company has provided. The foregoing acknowledgment of opportunity and
access shall not be deemed in any way to limit the representations and
warranties of the Company set forth in Article 2 above or the ability of the
Purchasers to rely thereupon.
SECTION
3.5. Acknowledgement of
Risk.
(a) The
Purchaser acknowledges and understands that its investment in the Securities
involves a significant degree of risk, including, without limitation, (i) the
Company has a history of operating losses and requires substantial funds in
addition to the proceeds from the sale of the Securities; (ii) an investment in
the Company is speculative, and only purchasers who can afford the loss of their
entire investment should consider investing in the Company and the Securities;
(iii) the Purchaser may not be able to liquidate its investment; (iv)
transferability of the Securities is limited; (v) in the event of a disposition
of the Securities, the Purchaser could sustain the loss of its entire
investment; and (vi) the Company has not paid any dividends on its Ordinary
Shares since inception and does not anticipate the payment of dividends in the
foreseeable future. Such risks are more fully set forth in the SEC
Documents, the Draft Annual Report and the Disclosure Schedules.
(b) The
Purchaser is able to bear the economic risk of holding the Securities for an
indefinite period, and has knowledge and experience in financial and business
matters such that it is capable of evaluating the risks of the investment in the
Securities.
(c) The
Purchaser has with respect to all legal matters relating to this Agreement and
the offer and sale of the Securities relied solely upon the advice of such
Purchaser’s own counsel and has not relied upon or consulted any counsel to the
Placement Agent or counsel to the Company.
(d) The
Purchasers acknowledge that the only representations or warranties the Company
is making in connection with the transaction contemplated hereby are those set
forth in Article 2, as modified by the SEC Documents, the Draft Annual
Report and the Disclosure Schedules.
SECTION
3.6. Governmental
Review. The Purchaser understands that no United States
federal or state or foreign Governmental Authority has passed upon or made any
recommendation or endorsement of the Securities or an investment
therein.
SECTION
3.7. Transfer or Resale;
Legends.
(a) The
Purchaser understands that:
(i) the
Securities have not been and will not be registered under the Securities Act
(other than as contemplated in Article 6) or any applicable state securities
laws and, consequently, the Purchaser may have to bear the risk of owning the
Securities for an indefinite period of time because the Securities may not be
transferred unless (A) the resale of the Securities is registered pursuant to an
effective registration statement under the Securities Act, as contemplated in
Article 6; or (B) the Securities to be sold or transferred are sold or
transferred pursuant to an exemption from such registration and, if requested by
the Company, or required by the
-12-
depositary,
the Purchaser has delivered to the Company an opinion of counsel to the
Purchaser (in form, substance and scope reasonably acceptable to the Company) to
such effect;
(ii) except as
set forth in Article 6 and Article 4, neither the Company nor any other Person
is under any obligation to register the resale of the Securities under the
Securities Act or any state or foreign securities laws or to comply with the
terms and conditions of any exemption thereunder;
(iii) the First
Closing Ordinary Shares and the Second Closing Securities will be delivered to
the Purchaser in the form of uncertificated restricted ADSs in the depositary’s
direct registration system and will be held as restricted securities until they
are resold pursuant to an effective registration statement under the Securities
Act (or an available exemption therefrom), or otherwise cease to be restricted
securities under the Securities Act; and
(iv) the
restricted ADSs will be subject to the transfer restrictions contained in the
legend set forth below:
THE
RESTRICTED AMERICAN DEPOSITARY SHARES (“RESTRICTED ADSs”) CREDITED TO
YOUR ACCOUNT AND THE UNDERLYING RESTRICTED SHARES (“RESTRICTED SHARES”) OF THE
COMPANY ARE SUBJECT TO THE TERMS OF THE SUPPLEMENTAL LETTER AGREEMENT, DATED AS
OF MAY 16, 2008 (THE “SUPPLEMENTAL LETTER
AGREEMENT”), AND THE DEPOSIT AGREEMENT, DATED AS OF MARCH 29, 1993, AS
AMENDED AND SUPPLEMENTED (AS SO AMENDED AND SUPPLEMENTED, THE “DEPOSIT
AGREEMENT”). ALL TERMS USED BUT NOT OTHERWISE DEFINED HEREIN
SHALL, UNLESS OTHERWISE SPECIFICALLY DESIGNATED HEREIN, HAVE THE MEANING GIVEN
TO SUCH TERMS IN THE SUPPLEMENTAL LETTER AGREEMENT, OR IF NOT DEFINED THEREIN,
IN THE DEPOSIT AGREEMENT.
HOLDERS
AND BENEFICIAL OWNERS OF THE RESTRICTED ADSs BY ACCEPTING AND HOLDING THE
RESTRICTED ADSs, AND ANY INTEREST THEREIN, SHALL BE BOUND BY THE TERMS OF THE
DEPOSIT AGREEMENT AND THE SUPPLEMENTAL LETTER AGREEMENT. AT THE TIME
OF ISSUANCE, THE RESTRICTED ADSs HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR
REGISTERED OR QUALIFIED UNDER ANY APPLICABLE STATE SECURITIES
LAWS. THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO (A) AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT IN A TRANSACTION REGISTERED OR QUALIFIED UNDER
APPLICABLE STATE SECURITIES LAWS OR (B) AN AVAILABLE EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION REQUIREMENTS. UNLESS A REGISTRATION
STATEMENT IS EFFECTIVE WITH RESPECT TO THESE SECURITIES, AS A CONDITION TO
PERMITTING ANY TRANSFER OF THESE SECURITIES, EACH OF THE DEPOSITARY AND THE
COMPANY MAY REQUIRE THAT IT
-13-
BE
FURNISHED WITH AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE DEPOSITARY
AND THE COMPANY TO THE EFFECT THAT NO REGISTRATION OR QUALIFICATION IS LEGALLY
REQUIRED FOR SUCH TRANSFER.
PRIOR TO
THE TRANSFER OF THE RESTRICTED ADSs, A HOLDER OF RESTRICTED ADSs WILL BE
REQUIRED TO PROVIDE TO THE DEPOSITARY AND TO THE COMPANY A CERTIFICATION IN THE
FORM ATTACHED TO THE SUPPLEMENTAL LETTER AGREEMENT. PRIOR TO THE
WITHDRAWAL OF THE RESTRICTED SHARES, A HOLDER OF RESTRICTED ADSs WILL BE
REQUIRED TO PROVIDE TO THE DEPOSITARY AND TO THE COMPANY A WITHDRAWAL
CERTIFICATION IN THE FORM ATTACHED TO THIS LETTER. THE TRANSFER AND
OTHER RESTRICTIONS SET FORTH HEREIN AND IN THE SUPPLEMENTAL LETTER AGREEMENT
SHALL REMAIN APPLICABLE WITH RESPECT TO THE RESTRICTED ADSs AND THE RESTRICTED
SHARES UNTIL SUCH TIME AS THE PROCEDURES SET FORTH IN THE SUPPLEMENTAL LETTER
AGREEMENT FOR REMOVAL OF RESTRICTIONS ARE SATISFIED. NEITHER THE
COMPANY NOR THE DEPOSITARY MAKES ANY REPRESENTATION AS TO THE AVAILABILITY OF
THE EXEMPTION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT FOR RESALE OF THE
RESTRICTED SHARES OR THE RESTRICTED ADSs. A COPY OF THE DEPOSIT
AGREEMENT AND OF THE SUPPLEMENTAL LETTER AGREEMENT MAY BE OBTAINED FROM THE
DEPOSITARY OR THE COMPANY UPON REQUEST.
(b) A
Purchaser may request, and the Company agrees to authorize, that its Securities
be withdrawn from the depositary’s direct registration system at any time and
reissued in certificated form to the Purchaser or any transferee from the
Purchaser pursuant to a transfer complying with this Section 3.7, provided that all such
certificates shall bear the legend provided in Section 3.7(a)(iv) unless (i) the
sale of the Securities was made pursuant to an effective Registration Statement
or (ii) such Securities in the hands of the transferee are eligible
for sale under Rule 144 under the Securities Act without restriction as to
current public information, volume or the manner of sale.
Notwithstanding
the provisions of subsections (a) and (b) above, no such registration statement
or opinion of counsel shall be necessary for a transfer by a Purchaser (i) that
is a partnership to an affiliate, a partner or limited partner of such
partnership or a retired partner of such partnership who retires after the date
hereof, or to the estate of any such partner, limited partner or retired partner
or the transfer by gift, will or intestate succession of any partner to his or
her spouse or to the siblings, lineal descendants or ancestors of such partner
or his or her spouse; (ii) that is a corporation to its stockholders in
accordance with their interest in the corporation; (iii) that is a limited
liability company to its members or former members in accordance with their
interest in the limited liability company; or (iv) to the Purchaser’s family
member or trust for the benefit of the individual Purchaser, if the transferee
agrees in writing to be subject to the terms hereof to the same extent as if he
or she were an original Purchaser hereunder.
SECTION
3.8. Authorization;
Enforcement. The Purchaser has the requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby and thereby. The Purchaser has taken all
necessary action to authorize the execution, delivery
-14-
and
performance of this Agreement. Upon the execution and delivery of
this Agreement, this Agreement shall constitute a valid and binding obligation
of the Purchaser enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ and contracting
parties’ rights generally and except as enforceability may be subject to general
principles of equity and except as rights to indemnity and contribution may be
limited by applicable securities laws or public policy underlying such
laws.
SECTION
3.9. Residency. The Purchaser is
organized under the laws and the jurisdiction set forth immediately below such
Purchaser’s name on the signature pages hereto.
SECTION
3.10. No Short
Sales. During the period commencing at the time the Purchaser
was first contacted with reference to the transactions contemplated hereunder,
neither the Purchaser nor, to the Purchaser’s knowledge, any Affiliate of the
Purchaser, foreign or domestic, has, directly or indirectly, effected or agreed
to effect any “short sale” (as defined in Rule 200 under Regulation SHO),
whether or not against the box, established any “put equivalent position” (as
defined in Rule 16a-1(h) under the Exchange Act) with respect to the Ordinary
Shares, borrowed or pre-borrowed any Ordinary Shares, or granted any other right
(including, without limitation, any put or call option) with respect to the
Ordinary Shares or with respect to any security that includes, relates to or
derived any significant part of its value from the Ordinary Shares or otherwise
sought to hedge its position in the Securities (each, a “Prohibited
Transaction”). Prior to the earliest to occur of (i) the
termination of this Agreement, (ii) the date that the First Registration
Statement becomes effective or (iii) the First Required Effectiveness Date, such
Purchaser shall not engage, directly or indirectly, in a Prohibited
Transaction. Additionally, in the event that the Second Closing
occurs, beginning on the date the Purchasers receive Notice from the Company and
prior to the earliest to occur of (i) the date that the Second Registration
Statement becomes effective or (ii) the Second Required Effectiveness Date, such
Purchasers shall not engage, directly or indirectly, in a Prohibited
Transaction. Each Purchaser acknowledges that the representations,
warranties and covenants contained in this Section 3.10 are being made for the
benefit of the Purchasers as well as the Company and that each Purchaser shall
have an independent right to assert any claims against any other Purchaser
arising out of any breach or violation of the provisions of this Section
3.10.
SECTION
3.11. Acknowledgments Regarding Placement
Agent; Solicitation. The Purchaser acknowledges that the
Placement Agent is acting as the lead North American placement agent on a “best
efforts” basis for the Securities being purchased hereunder and will be
compensated by the Company for acting in such capacity. The Purchaser
represents that (i) the Purchaser was contacted regarding the sale of the
Securities by the Placement Agent (or an authorized agent or representative
thereof), with whom the Purchaser entered into a confidentiality agreement and
(ii) the Purchaser did not become aware that the Securities were being offered
for sale by means of any form of general solicitation or general
advertising.
ARTICLE
4
COVENANTS
SECTION
4.1. Conduct of
Business. During the period from the date of this Agreement
until the First Closing, except as expressly set forth in this Agreement, the
Company agrees that, without the prior written consent of a Majority of the
Preference Share Purchasers (the parties hereto agree that, for purposes of this
Section 4.1 and Section 4.2, references to the Company shall include each
Subsidiary of the Company, such that each Subsidiary of the Company shall
be
-15-
subject
to, and bound by, the obligations and requirements contained in this Section 4.1
and Section 4.2, and the Company agrees to take such action as may be required
to cause each such Subsidiary to comply with and be bound by this Section 4.1
and Section 4.2):
(a) The
Company’s business shall be conducted only in the ordinary course, in a manner
consistent with past practice, and in compliance in all material respects with
all applicable law;
(b) The
Company shall not (i) make or assist in making any change in, or amendment to,
the governance or organizational documents of the Company or any material
contract of the Company listed in Schedule 4.1(b) of the Disclosure Schedules
(the “Material
Contracts”); (ii) breach any Material Contract; or (iii) enter into
any contract that requires the Company to pay, or entitles the Company to
receive, in excess of $100,000 in any twelve month period;
(c) The
Company shall not (i) create, incur, assume, or guarantee any liability or
Indebtedness, except trade payables incurred in the ordinary course of business,
consistent with past practice; or (ii) loan or advance any funds;
(d) Other
than in the ordinary course of business, consistent with past practice, the
Company shall not (i) acquire any property or asset; (ii) make any capital
expenditure; (iii) sell, transfer, lease, assign, or dispose of, or agree to
sell, transfer, lease, assign, or dispose of, any property or asset; or (iv)
enter into any transaction or transactions;
(e) The
Company shall not make any distribution or pay any dividend in respect of its
capital stock;
(f) The
Company shall not subject to any Lien, or permit any Lien to exist on, the
leased real property or any other property or asset of the Company (other than
Liens in existence as of the date hereof);
(g) The
Company shall not issue any (i) securities; (ii) options, warrants, puts, calls,
commitments, agreements, contracts, preemptive, rights of first refusal, or
other rights to purchase, issue, or otherwise acquire any securities of the
Company; or (iii) obligations or securities convertible into or exchangeable for
securities of the Company;
(h) The
Company shall maintain each of its insurance policies in existence as of the
date hereof;
(i) The
Company shall not (i) enter into any employment or consulting agreement or
arrangement; (ii) amend or modify any existing employment or consulting
agreement or arrangement, or adopt, amend, modify, or terminate any employee
benefit plan (except as provided in Section 5.2(o)); (iii) other than
in the ordinary course of practice, consistent with past practice, terminate or
modify the terms of employment of, any of the Company’s employees; or
(iv) make any change in the rate of compensation, commission, bonus,
benefits, or other direct or indirect remuneration payable to or in respect of
any of the Company’s employees or consultants;
(j) The
Company shall not (i) release any claims, or waive any rights; or (ii) settle or
compromise any litigation, action, proceeding, or claim involving any liability
for
-16-
money
damages or any restrictions upon any of its operations or that may be
precedential with respect to other litigations, actions, proceedings, or claims
that may involve such damages or restrictions;
(k) The
Company shall not change accounting principles, policies, practices, or related
methodologies, or change any of its methods of reporting income and deductions
for income tax purposes, except as required by changes in applicable
law;
(l) The
Company shall not close any offices at which the Company’s business is conducted
or open any new offices; and
(m) The
Company shall not make or change any tax election, change an annual accounting
period, adopt or change any accounting method with respect to taxes, file any
amended tax return, enter into any closing agreement, settle or compromise any
proceeding with respect to any tax claim or assessment relating to the Company,
surrender any right to claim a refund of taxes, consent to any extension or
waiver of the limitation period applicable to any tax claim or assessment
relating to the Company, or take any other similar action relating to the filing
of any tax return or the payment of any tax.
SECTION
4.2. Preservation of Business and
Assets. During the period from the date of this Agreement
until the First Closing, the Company (a) shall use its commercially
reasonable efforts to preserve the current business and goodwill of the Company,
and (b) shall not change the fundamental nature or characteristics of its
business from the business conducted as of the date hereof.
SECTION
4.3. Notification. During
the period from the date of this Agreement until the First Closing, the Company
shall promptly notify each Purchaser in writing of any fact, condition, event,
or occurrence that (a) causes or constitutes a breach of any of the Company’s
representations or warranties made as of the date of this Agreement or that
would cause or constitute such a breach had such representation or warranty been
made as of the time of occurrence or discovery of such fact, condition, event,
or occurrence; (b) causes or constitutes a breach of any covenant of the Company
under this Agreement or that may make satisfaction of any of the conditions in
Section 5.2 impossible or unlikely; or (c) has or could reasonably be expected
to have a Material Adverse Effect. No such notification shall be
deemed to modify the representations, warranties, or covenants of the Company
contained in this Agreement for any purpose.
SECTION
4.4. Access and
Information. During the period from the date of this Agreement
until the First Closing, the Company shall give each Purchaser and its
Affiliates and their respective accountants, counsel, and other representatives
reasonable access during normal business hours to the Company’s offices,
properties, books, contracts, commitments, reports, records, and personnel, and
give them, or give them access to, the documents, financial data, records, and
information with respect to the Company and its business as any Purchaser from
time to time reasonably requests.
SECTION
4.5. Further
Actions. Each party hereto shall, as promptly as practicable,
use all commercially reasonable efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things necessary, proper, or
advisable to fulfill its obligations under this Agreement and to consummate and
make effective the transactions contemplated hereby.
-17-
SECTION
4.6. Reporting
Status. The ADSs and the Ordinary Shares are registered under
Section 12 of the Exchange Act. During the Registration Period, the
Company agrees to use commercially reasonable efforts to timely file all
documents with the SEC, and the Company will not terminate its status as an
issuer required to file reports under the Exchange Act even if the Exchange Act
or the rules and regulations thereunder would permit such
termination.
SECTION
4.7. Financial
Information. The financial statements of the Company to be
included in any documents to be filed with the SEC will be prepared in
accordance with accounting standards permitted by the Exchange Act (including on
the date hereof, International Financial Reporting Standards as adopted by the
European Union), consistently applied (except as may be otherwise indicated in
such financial statements or the notes thereto) and will fairly present in all
material respects the consolidated financial position of the Company and
consolidated results of its operations and cash flows as of, and for the periods
covered by, such financial statements (subject, in the case of unaudited
statements, to normal year-end audit adjustments).
SECTION
4.8. Securities Laws Disclosure;
Publicity. On May 14, 2008, the Company shall issue a press
release (subject to prior review and approval, not to be unreasonably withheld,
by the Purchasers) announcing the signing of this Agreement and describing the
terms of the transactions contemplated by this Agreement. On or
before May 16, 2008, the Company shall submit a Current Report on Form 6-K
(subject to prior review and approval, not to be unreasonably withheld, by the
Purchasers) to the SEC describing the terms of the transactions contemplated by
this Agreement and including as an exhibit to such Current Report on Form 6-K,
this Agreement in the form required by the Exchange Act. The Company
shall not otherwise publicly disclose the name of any Purchaser, or include the
name of any Purchaser in any filing with the SEC (other than the Registration
Statement and any exhibits to filings made in respect of this transaction in
accordance with periodic filing requirements under the Exchange Act) or any
regulatory agency, without the prior written consent of such Purchaser, except
to the extent such disclosure is required by law or regulations.
SECTION
4.9. Sales by the
Purchasers. Each Purchaser agrees that it will comply with the
prospectus delivery requirements of the Securities Act as applicable to it in
connection with the sales of Registrable Securities pursuant to a Registration
Statement or otherwise comply with the requirements for an exemption from
registration under the Securities Act and the rules and regulations promulgated
thereunder. No Purchaser will make any sale, transfer, pledge or
other disposition of the Securities in violation of U.S. federal or state or
foreign securities laws or the terms of this Agreement. Without
limiting the foregoing, the Purchasers acknowledge that, as a result of their
representation on the Company’s Board of Directors or otherwise, they may from
time to time come into possession of confidential information regarding the
Company that may constitute “material non-public information” under the U.S.
securities laws and agree not to trade in any securities of the Company while in
possession of such information in a manner that would violate the U.S.
securities laws or be inconsistent with the Company’s share dealing
code.
SECTION
4.10. Reservation of Ordinary
Shares. As of the date hereof, the Company has sufficient
authorized and unissued share capital, and the Company shall continue to have
sufficient authorized and unissued share capital for the purpose of enabling the
Company to issue Securities pursuant to this Agreement, and including, if
applicable, in connection with the Second Closing.
-18-
SECTION
4.11. Preemptive
Rights.
(a) Each
Purchaser shall have a right of first refusal to purchase up to such Purchaser’s
pro rata share (as defined below) of any offering by the Company of Ordinary
Shares or any other class or series of its capital stock, or any other
securities convertible into or exchangeable for Ordinary Shares or any other
class or series of capital stock (including convertible stock, redeemable stock
and debt with warrants, but excluding any Exempt Securities, any issuances
pursuant to the Company’s equity credit agreement with Brittany Capital
Management Ltd. dated as of June 1, 2007 provided such issuance shall
have been approved by the Supermajority Directors, and any issuances pursuant to
the Additional Financing in accordance with Section 4.14 below), in each case on
the same terms as the other investors participating in such
offering. Each Purchaser’s pro rata share shall be equal to the
percentage of the Company’s outstanding Ordinary Shares that are owned by such
Purchaser at the time of each such offering.
(b) The
Company shall provide written notice to each Purchaser that the Company is
considering any proposed future financing subject to this Section 4.11(b),
providing a general outline of the proposed structure and anticipated terms
thereof, not less than 15 days prior to completion thereof (the “Completion
Date”). The Company shall also provide written notice to each
such Purchaser describing in reasonable detail the terms of any such proposed
future financing (the “Detailed
Notice”) within a reasonable period of time (but not less than ten (10)
days prior to the Completion Date). Unless a Purchaser provides the
Company notice in writing within five (5) days of its receipt of the Detailed
Notice that it wishes to participate in such financing, such Purchaser’s right
with respect to such proposed future financing shall be deemed
waived. Anything herein to the contrary notwithstanding, if required
to accumulate from its investors the funds necessary to participate in any such
financing, each Purchaser who has delivered timely notice of its intent to
participate in such financing shall have up to fifteen (15) Business Days from
the date it sent such notice of its intent to participate to fund its purchase
even if any such period extends beyond the Completion Date.
(c) The
rights and obligations established pursuant to this Section 4.11 shall terminate
if (i) a Special Rights Termination Event shall have occurred or (ii) the
Purchasers cease to own in the aggregate at least 33% of the number of
Securities purchased by them in the First Closing and Second
Closing.
SECTION
4.12. Private Foreign Investment Company;
Controlled Foreign Corporation.
(a) Upon
request, the Company will provide each Purchaser all information needed to make
a “Qualified Electing Fund” election pursuant to Section 1295 of the U.S.
Internal Revenue Code of 1986, as amended (or any successor thereto) (the “Code”) and will provide each
Purchaser a completed “PFIC Annual Information Statement” as required by
Treasury Regulation Section 1.1295-1(g)(1) within sixty (60) days after the
end of the Company’s taxable year.
(b) The
Company shall make due inquiry with its tax advisors on at least an annual basis
regarding the Company’s status as a “Controlled Foreign Corporation” as defined
in the Code (“CFC”) and
regarding whether any portion of the Company’s income is “Subpart F Income” (as
defined in Section 952 of the Code) (“Subpart F
Income”). Each Purchaser shall reasonably cooperate with the
Company to provide information about such Purchaser and such
-19-
Purchaser’s
Partners (as defined below) in order to enable the Company’s tax advisor’s to
determine the status of such Purchaser and/or any of such Purchaser’s Partners
as a “United States Shareholder” within the meaning of Section 951(b) of the
Code. No later than sixty (60) days following the end of each Company
taxable year, the Company shall provide the following information to the
Purchasers: (i) the Company’s capitalization table as of the end of the last day
of such taxable year and (ii) a report regarding the Company’s status as a
CFC. In addition, the Company shall provide the Purchasers with
access to such other Company information as may be necessary for the Purchasers
to determine the Company’s status as a CFC and to determine whether Purchaser or
any of Purchaser’s Partners is required to report its pro rata portion of the
Company’s Subpart F Income on its United States federal income tax return, or to
allow such Purchaser or such Purchaser’s Partners to otherwise comply with
applicable United States federal income tax laws.
-20-
For
purposes of this provision, (A) the term “Purchaser’s Partners” means
each of the Purchaser’s partners and any direct or indirect equity owners of
such partners and (B) the “Company” means the Company and
any of its Subsidiaries.
SECTION
4.13. Additional
Covenants.
(a) Other
than pursuant to an Additional Financing in accordance with Section 4.14 below,
the Company shall not issue any Ordinary Shares or other securities in
connection with the raising of additional financing or capital until all of the
Securities issued in the First Closing have been registered for resale as
provided in Article 6.
(b) **********
Approximately 11 lines omitted **********
(c) **********
Approximately 7 lines omitted **********
(d) In
advance of the Company’s next Annual General Meeting, the Board will propose
such amendments to its Memorandum and Articles of Association as are necessary
to (i) ensure to the maximum extent permitted by English law that the Preference
Shares held by the Purchasers will entitle them to vote as a separate class
without the vote of the holders of Ordinary Shares in all general,
extraordinary, annual, or special meetings of the shareholders of the Company,
and whether or not adjourned or postponed, for the election of the four (4) or
five (5) (as the case may be) Directors as they will be entitled to elect
pursuant to the provisions of the Preference Shares attached as Exhibit D
hereto, and (ii) generally to bring the Memorandum and Articles of Association
current with the 2006 amendments to the Companies Act.
(e) At the
first meeting of the Board of Directors following the First Closing, the
committees of the Board will be re-constituted to consist of four (4) members
each, with the members of each committee being appointed as provided in the
provisions of the Preference Shares.
SECTION
4.14. Additional
Financing. The Company shall have the right, but not the
obligation, to issue and sell Ordinary Shares to certain of its directors (the
“Additional Financing
Purchasers”) in an additional financing (the “Additional Financing”); provided that all
documentation for the Additional Financing (the “Additional Financing
Documentation”) shall be in substantially the form most recently provided
to the Purchasers prior to their execution of this Agreement; and provided, further, that:
(a) the
aggregate amount raised in the Additional Financing shall not exceed
$4,000,000;
(b) the
Additional Financing shall be at the same price and on the same economic terms
as those contemplated hereby;
(c) the
Additional Financing shall be funded in two (2) tranches, (A) the first of which
shall equal 50% of the total Additional Financing and (B) the second of which
shall
CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS (*) DENOTE SUCH OMISSIONS.
WITH THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS (*) DENOTE SUCH OMISSIONS.
-21-
equal 50%
of the total Additional Financing (the “Additional Financing Second Closing
Amount”); and
(d) the
proceeds received by the Company in the Additional Financing shall be applied in
accordance with Section 4.13(b) above.
If any
Additional Financing Purchaser funds less than such Additional Financing
Purchaser’s full pro rata share of the Additional Financing Second Closing
Amount (such unfunded amount shall be referred to herein as an “Additional Financing Shortfall
Amount”), then upon consummation of the Second Closing the Additional
Financing Purchasers that fund their full pro rata shares of the Additional
Financing Second Closing Amount at the Second Closing shall have the right, but
not the obligation, to fund any Additional Financing Shortfall Amount (in such
proportions as such participating Additional Financing Purchasers shall
determine in their sole discretion).
ARTICLE
5
CONDITIONS
TO CLOSING
SECTION
5.1. Conditions to the Company’s
Obligations at the First
Closing. The Company’s obligation to complete the purchase and
sale of the First Closing Securities in respect of each Purchaser in connection
with the First Closing is subject to the fulfillment or waiver as of the First
Closing Date of the following conditions in respect of such
Purchaser:
(a) Receipt of
Funds. The Company shall have received immediately available
funds, in US dollars, in the full amount of the First Closing Purchase Price as
set forth opposite such Purchaser’s name on Exhibit
A hereto.
(b) Representations and
Warranties. The representations and warranties made by such
Purchaser in Article 3 shall be true and correct in all material respects as of
the date such representation and warranty was made and as of the First Closing
Date.
(c) Covenants. All
covenants, agreements and conditions contained in this Agreement to be performed
by such Purchaser on or prior to the First Closing Date shall have been
performed or complied with in all material respects.
(d) Absence of
Litigation. No proceeding challenging this Agreement or the
transactions contemplated hereby, or seeking to prohibit, alter, prevent or
materially delay the First Closing, shall have been instituted, threatened or be
pending before any court, arbitrator, official or Governmental
Authority.
(e) No Governmental
Prohibition. The sale of the First Closing Securities by the
Company to such Purchaser shall not be prohibited by any law or governmental
order or regulation.
(f) Full
Funding. Each of the other Purchasers shall have paid in full
the aggregate First Closing Purchase Price as set forth opposite each such
Purchaser’s name on Exhibit
A.
-22-
SECTION
5.2. Conditions to Each Purchaser’s Obligations at the First
Closing. Each Purchaser’s obligation to complete the purchase
and sale of the First Closing Securities is subject to the fulfillment or waiver
as of the First Closing Date of the following conditions:
(a) Representations and
Warranties. The representations and warranties made by the
Company in Article 2, if made without reference to materiality or a Material
Adverse Effect shall be true and correct in all material respects and if made
subject to materiality or with reference to a Material Adverse Effect shall be
true and correct as written, in each case as of the date such representation and
warranty was made and as of the First Closing Date.
(b) Covenants. All
covenants, agreements and conditions contained in this Agreement to be performed
by the Company on or prior to the First Closing Date shall have been performed
or complied with in all material respects.
(c) Material Adverse
Effect. There shall have been no Material Adverse Effect with
respect to the Company since September 30, 2007.
(d) Other
Documentation. The Company shall have delivered such other
certificates, instruments, opinions and other documents as the Purchasers may
reasonably request, and the Purchasers shall have received such documents and
certificates of officers of the Company to verify the satisfaction of the
conditions set forth in Sections 5.2(a) and (b), and the form and substance of
all certificates, instruments, opinions and other documents delivered to the
Purchasers under this Agreement shall be satisfactory in all reasonable respects
to the Purchasers
(e) Legal
Opinions.
(i) The
Company shall have delivered to the Purchasers an opinion, dated as of the First
Closing Date, from each of (x) XX Xxxxx XXX, XX counsel to the Company, in form
and substance reasonably acceptable to the Purchasers, and (y) Xxxxxx Xxxxxx
& Xxxxxxx llp,
US counsel to the Company, in substantially the form attached hereto as Exhibit
C; and
(ii) Each
Purchaser whose fund documents so require shall have received an opinion, dated
as of the First Closing Date, from counsel in the Republic of Ireland and the
United Kingdom regarding the continued limited liability of such Purchaser’s
limited partners and the tax effects on such limited partners of the
transactions contemplated by this Agreement, in each case reasonably acceptable
to such Purchaser.
(f) Depositary Account
Statements. The Company shall have delivered to its ADS
depositary, with a copy to each Purchaser, irrevocable instructions to issue to
such Purchaser, on an expedited basis, one or more account statements in the
name of such Purchaser reflecting the number of First Closing Ordinary Shares
set forth opposite such Purchaser’s name on Exhibit
A hereto.
(g) Absence of
Litigation. No proceeding challenging this Agreement or the
transactions contemplated hereby, or seeking to prohibit, alter, prevent or
materially delay the
-23-
First
Closing, shall have been instituted, threatened or be pending before any court,
arbitrator, official or Governmental Authority.
(h) Full
Funding. Each of the other Purchasers shall have paid in full
the Aggregate First Closing Purchase Price as set forth opposite each such
Purchaser’s name on Exhibit
A.
(i) No Governmental
Prohibition. The sale of the First Closing Securities by the
Company to such Purchaser shall not be prohibited by any law or governmental
order or regulation.
(j) Governmental
Approvals. All actions and approvals, consents, or waivers by
or in respect of, or filings with, any Governmental Authority required to be
taken, obtained, or made in connection with, or to permit, the consummation of
the transactions contemplated by this Agreement shall have been taken, obtained,
or made, including, without limitation, all such actions, approvals, consents,
waivers, or filings that may be required by the anti-competition laws of the
European Union.
(k) Preference
Shares. The Company shall have delivered to each Purchaser,
one or more certificates in the name of the Purchaser evidencing the number of
Preference Shares set forth opposite such Purchaser’s name on Exhibit
A.
(l) Board
Resolutions. The Company shall have delivered to the
Purchasers a certified copy of the resolutions of its Board of Directors (i)
approving the creation of the Preference Shares, including the rights,
preferences and designations thereto, this Agreement and the transactions
contemplated hereby, and (ii) establishing that the quorum necessary for
the transaction of the business of the Company’s Board of Directors shall be six
(6) directors, comprising three (3) Directors who shall have been elected or
appointed to the Board pursuant to the provisions of the Preference Shares and
any three (3) directors other than directors who have been elected or appointed
to the Board of Directors pursuant to the provisions of the Preference Shares,
in each case, in form and substance reasonably acceptable to the
Purchasers.
(m) Board of
Directors.
(i) The
Company’s Board of Directors shall consist of not more than eight directors,
four (4) of whom shall be the following designees of the Purchasers: Xxxxx X.
Xxxxx, Xxxx X. Xxxxxx, Xxxxxxxx Xxxxxxxx, and Xxxx Xxxxxx.
(ii) The
Company shall have delivered to the Purchasers copies of the resignations of the
directors that were required to be received to produce the result set forth in
Section 5.2(m)(i) above.
(iii) Xxxx
Xxxxx shall have been appointed as an observer to the Board of Directors and as
a member of the Company’s Scientific Advisory Board.
(iv) The
Company and the Purchasers shall have entered into a letter agreement, in form
and substance reasonably acceptable to the Company and a Majority of the
Preference Share Purchasers, with respect to the operations and structure of the
Board of Directors.
-24-
(n) Additional Financing
Documentation. In accordance with Section 4.14 hereof, the
Company shall have delivered to the Purchasers fully executed copies of the
Additional Financing Documentation.
(o) Amendments to Employment
Agreements.
(i) The
employment agreement of Xxxx Xxxxx shall have been amended (in form and
substance reasonably acceptable to the Purchaser) so as to delete from such
employment agreement the Company’s obligation to appoint Xxxx Xxxxx to the
Company’s Board of Directors.
(ii) **********
Approximately 5 lines omitted ***********
(p) Voting
Agreement. Xxx Xxxxx (and/or Amarin Investment Holding
Limited, as applicable), IIU Nominees Ltd., Xxxxxxx Xxxxx, Xxxxx Xxxxx and
Sunninghill Limited (each, a “Shareholder”) will have
entered into voting agreements reasonably satisfactory to the Purchasers whereby
each Shareholder severally and not jointly, and solely with respect to the ADSs
and Ordinary Shares held of record by such Shareholder, will agree that (i) at
any meeting (whether general, extraordinary, annual or special and whether or
not an adjourned or postponed meeting) of the holders of Ordinary Shares,
however called, or in connection with any written consent of the holders of
Ordinary Shares, such Shareholder shall vote (or cause to be voted) all of the
ADSs and Ordinary Shares held of record by such Shareholder in favor of (A)
amendments to the Memorandum and Articles of Association as are necessary to
ensure to the maximum extent permitted by English law that the Preference Shares
held by the Purchasers will entitle them to vote as a separate class without the
vote of the holders of Ordinary Shares for the election of the four (4) or five
(5) (as the case may be) Directors as they will be entitled to elect pursuant to
the provisions of the Preference Shares attached as Exhibit D to this Agreement,
(B) the Second Closing, ratifying the execution, delivery and performance of
this Agreement and the approval and adoption of the terms hereof and each of the
other actions contemplated herein and (C) such amendments to the Memorandum and
Articles of Association as are determined by the Board to be necessary generally
to bring the Memorandum and Articles of Association current with the 2006
amendments to the Companies Act and (ii) such Shareholder shall not enter into
any agreement or understanding with any Person the effect of which would be
inconsistent with or violative of such voting agreements.
SECTION
5.3. Conditions to the Company’s
Obligations at the Second
Closing. The Company’s obligation to complete the purchase and
sale of the Second Closing Securities in respect of each Purchaser contemplated
by the Second Closing is subject to the fulfillment or waiver as of the Second
Closing Date of the following conditions in respect of such
Purchaser:
CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY
WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS
(*) DENOTE SUCH OMISSIONS.
-25-
(a) Receipt of
Funds. The Company shall have received immediately available
funds, in US dollars, in an amount equal to at least 75% of the Second Closing
Amount.
(b) Representations and
Warranties. The representations and warranties made by such
Purchaser in Article 3 (other than the representations and warranties made in
Sections 3.4, 3.9 and 3.11), shall be true and correct in all material respects
as of the date such representation and warranty was made and as of the Second
Closing Date.
(c) Covenants. All
covenants, agreements and conditions contained in this Agreement to be performed
by such Purchaser on or prior to the Second Closing Date shall have been
performed or complied with in all material respects.
(d) Absence of
Litigation. No proceeding challenging this Agreement or the
transactions contemplated hereby, or seeking to prohibit, alter, prevent or
materially delay the Second Closing, shall have been instituted, threatened or
be pending before any court, arbitrator, official or Governmental
Authority.
(e) No Governmental
Prohibition. The sale of the Second Closing Securities by the
Company shall not be prohibited by any law or governmental order or
regulation.
SECTION
5.4. Conditions to Each Purchaser’s Obligations at the Second
Closing. Each Purchaser’s obligation to complete the purchase
and sale of the Second Closing Securities contemplated by the Second Closing is
subject to the fulfillment or waiver as of the Second Closing Date of the
following conditions:
(a) Representations and
Warranties. The representations and warranties made by the
Company in Article 2 (other than the representations and warranties made in
Sections 2.7, 2.15, 2.25 and 2.26), if made not subject to materiality or
without reference to a Material Adverse Effect shall be true and correct in all
material respects and if made subject to materiality or with references to a
Material Adverse Effect shall be true and correct as written, in each case as of
the date such representation and warranty was made, as of the First Closing Date
and as of the Second Closing Date; provided that any reference
in Article 2 to the Draft Annual Report shall be deemed to refer to the SEC
Documents; and provided
further that the representation in Section 2.4 may be updated to
reflect the First Closing, the issuance of Exempt Securities (if any), and any
issuance of securities pursuant to the Additional Financing, without such
changes constituting non-fulfillment of this condition.
(b) Covenants. All
covenants, agreements and conditions contained in this Agreement to be performed
by the Company on or prior to the Second Closing Date shall have been performed
or complied with in all material respects.
(c) Legal
Opinions.
(i) The
Company shall have delivered to the Purchasers an opinion, dated as of the
Second Closing Date, from each of (x) XX Xxxxx XXX, XX counsel to the Company,
in substantially the form delivered at the First Closing but relating only to
the Second Closing Securities and (y) Xxxxxx Xxxxxx & Xxxxxxx llp,
US counsel to
-26-
the
Company, in substantially the form attached hereto as Exhibit
C, but relating only to the Second Closing Securities; and
(ii) Each
Purchaser whose fund documents so require shall have received an opinion, dated
as of the First Closing Date, from counsel in the Republic of Ireland and the
United Kingdom regarding the continued limited liability of such Purchaser’s
limited partners and the tax effects on such limited partners of the
transactions contemplated by this Agreement, in each case in substantially the
form delivered at the First Closing pursuant to Section 5.2(e)(i) but
relating only to the Second Closing Securities.
(d) Depositary Account
Statements. The Company shall have delivered to its ADS
depositary, with a copy to the Purchaser, irrevocable instructions to issue to
such Purchaser, on an expedited basis, one or more account statements in the
name of such Purchaser reflecting the number of Second Closing Securities to be
purchased by such Purchaser as determined in accordance with Section
1.1(b).
(e) Absence of
Litigation. No proceeding challenging this Agreement or the
transactions contemplated hereby, or seeking to prohibit, alter, prevent or
materially delay the Second Closing, shall have been instituted, threatened or
be pending before any court, arbitrator, official or Governmental
Authority.
(f) No Governmental
Prohibition. The sale of the Second Closing Securities by the
Company to such Purchaser shall not be prohibited by any law or governmental
order or regulation.
(g) Receipt of
Funds. Other Purchasers shall have paid, in the aggregate, not
less than that portion of the aggregate Second Closing Purchase Price which,
when added to the Second Closing Purchase Price to be paid by such Purchaser,
equals at least 75% of the Second Closing Amount.
(h) Governmental
Approvals. All actions and approvals, consents, or waivers by
or in respect of, or filings with, any Governmental Authority required to be
taken, obtained, or made in connection with, or to permit, the consummation of
the transactions contemplated by this Agreement shall have been taken, obtained,
or made, including, without limitation, all such actions, approvals, consents,
waivers, or filings that may be required by the anti-competition laws of the
European Union.
(i) Other
Documentation. The Company shall have delivered such other
certificates, instruments, opinions and other documents as the Purchasers may
reasonably request, and the Purchasers shall have received such documents and
certificates of officers of the Company to verify the satisfaction of the
conditions set forth in Sections 5.4(a) and (b), and the form and substance of
all certificates, instruments, opinions and other documents delivered to the
Purchasers under this Agreement shall be satisfactory in all reasonable respects
to the Purchasers.
-27-
ARTICLE
6
REGISTRATION
RIGHTS
SECTION
6.1. Registration
Statements.
(a) As soon
as reasonably practicable, but in no event later than sixty (60) days after the
First Closing Date (the “First Filing Date”), the Company
shall prepare and file a registration statement (the “First Registration Statement”)
covering the resale on a continuous or delayed basis by the Holders of all of
the Registrable Securities issued in connection with the First Closing with the
SEC pursuant to Rule 415 and shall use its commercially reasonable efforts to
cause the First Registration Statement to become effective under the Securities
Act not later than the later of (i) ninety (90) days after the initial filing of
such First Registration Statement or (ii) one hundred fifty (150) days after the
Closing Date or, in the event of a “review” by the SEC, not later than the later
of (i) one hundred twenty (120) days after the initial filing of such First
Registration Statement or (ii) one hundred eighty (180) days after the First
Closing Date (the “First
Required Effectiveness
Date”).
(b) If the
Second Closing occurs, then as soon as reasonably practicable, but in no event
later than sixty (60) days after the Second Closing Date (the “Second Filing Date”), the
Company shall prepare and file a registration statement (the “Second Registration Statement”
and, together with the First Registration Statement, the “Registration Statements”)
covering the resale on a continuous or delayed basis by the Holders of all of
the Registrable Securities issued in connection with the Second Closing with the
SEC pursuant to Rule 415 and shall use its commercially reasonable efforts to
cause the Second Registration Statement to become effective under the Securities
Act not later than the later of (i) ninety (90) days after the initial filing of
such Second Registration Statement or (ii) one hundred fifty (150) days after
the Closing Date or, in the event of a “review” by the SEC, not later than the
later of (i) one hundred twenty (120) days after the initial filing of such
Second Registration Statement or (ii) one hundred eighty (180) days after the
Second Closing Date (the “Second Required Effectiveness
Date”).
(c) The
Company’s shareholders (other than the Holders and the Additional Financing
Purchasers) shall not have the right to include any of the Company’s securities
in the Registration Statements.
(d) The
Company agrees that it shall cause each Registration Statement and the related
prospectus and any amendment or supplement thereto, as of the effective date of
the Registration Statement or such amendment or supplement, (i) to comply in all
material respects with the applicable requirements of the Securities Act, and
(ii) not to 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 the case of the prospectus, in the light of the
circumstances under which they were made) not misleading, and the Company agrees
to furnish to the Holders copies of any supplement or amendment upon the request
of such Holder prior to its being used or promptly following its filing with the
SEC; provided, however,
that the Company shall have no obligation to deliver to the Holders copies of
any amendment consisting exclusively of an Exchange Act report or other Exchange
Act filing otherwise publicly available on the Company’s website.
-28-
SECTION
6.2. Registration
Expenses. All Registration Expenses shall be borne by the
Company. All Selling Expenses relating to the sale of securities
registered by or on behalf of Holders shall be borne by such Holders pro rata on
the basis of the number of securities so registered.
SECTION
6.3. Registration
Default. The Company further agrees that, in the event that
(a) the First or Second Registration Statements (i) have not been filed with the
SEC within 60 days after the First or Second Closing Date, respectively, (ii)
have not been declared effective by the SEC by the First or Second Required
Effectiveness Dates, respectively, or (iii) after either of the First or Second
Registration Statements are declared effective by the SEC, either or both are
suspended by the Company or cease to remain continuously effective at all times
during the Registration Period as to all applicable Registrable Securities for
which such Registration Statement is required to be effective, other than, in
each case, within the time period(s) permitted by Section 6.7(b), or (b) the
Company has failed to perform its obligations set forth in Section 6.4 within
the time periods required therein (each such event referred to in clauses
(a)(i), (ii) and (iii) and clause (b), a “Registration Default”), for
all or part of one or more thirty-day periods (each a “Penalty Period”) during which
the Registration Default remains uncured, the Company shall pay to each
Purchaser 1% of such Purchaser’s aggregate purchase price of its Securities for
each Penalty Period (or partial Penalty Period) during which the Registration
Default remains uncured; provided, however, that if the primary
cause of a Registration Default is a Purchaser’s failure to provide the Company
with any information that is required to be provided in the applicable
Registration Statement with respect to such Purchaser as set forth herein, then
the commencement of the Penalty Period described above shall be extended until
two Business Days following the date of receipt by the Company of such required
information; and provided, further, that in no event
shall the Company be required hereunder to pay to any Purchaser pursuant to this
Agreement an aggregate amount that exceeds 10% of the aggregate First Closing
Purchase Price and, if applicable, Second Closing Purchase Price paid by such
Purchaser for such Purchaser’s Securities. The Company shall deliver
said cash payment to the Purchaser by the fifth Business Day after the end of
each such Penalty Period. If the Company fails to pay said cash
payment to the Purchasers in full by the fifth Business Day after the end of
such Penalty Period, the Company will pay interest thereon at a rate of 12% per
annum (or such lesser maximum amount that is permitted to be paid by applicable
law) to the Purchasers, accruing daily from the date such liquidated damages are
due until such amounts, plus all such interest thereon, are paid in
full. The cash payments provided by this Section 6.3 shall be in
addition to, and not in lieu of, such other damages as each Purchaser may
establish in connection with each Registration Default.
SECTION
6.4. Registration Procedures. At
its expense the Company shall:
(a) (i) prepare
and file with the SEC, in accordance with this Article 6, Registration
Statements with respect to the registrations of the Registrable Securities on
any forms which may be utilized by the Company and which shall permit the
disposition of the Registrable Securities in accordance with the intended method
or methods thereof, as specified in writing by the Holders, and, except for such
times as the Company is permitted hereunder to suspend the use of the prospectus
forming part of the Registration Statements as provided in Section 6.7(b), use
its commercially reasonable efforts to keep such Registration Statements
continuously effective with respect to a Holder and to keep such Registration
Statements free of any material misstatements or omissions, until the earlier of
(A) the date all Registrable Securities have been sold pursuant to effective
Registration Statements and (B) the date that all Registrable Securities can be
sold by all Holders publicly under Rule 144 under the Securities Act without
restriction as to current public information, volume, manner of sale,
or
-29-
otherwise. The
period of time during which the Company is required hereunder to keep the
Registration Statements effective, as provided in the immediately preceding
sentence, is referred to herein as the “Registration Period”; and (ii)
use its commercially reasonable efforts to prepare and file with the SEC such
amendments and post-effective amendments to the Registration Statements and file
with the SEC any other required document as may be necessary to keep such
Registration Statements continuously effective until the expiration of the
Registration Period; cause the related prospectus to be supplemented by any
required prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 (or any similar provisions then in force) under the Securities Act; and
comply with the provisions of the Securities Act applicable to it with respect
to the disposition of all Registrable Securities covered by such Registration
Statements during the Registration Period in accordance with the intended
methods of disposition by the sellers thereof set forth in such Registration
Statements as so amended or such prospectus as so supplemented;
(b) advise
the Holders within five Business Days:
(i) when the
Registration Statements or any amendment thereto have been filed with the SEC
and when the Registration Statements or any post-effective amendments thereto
has become effective;
(ii) of any
request by the SEC for amendments or supplements to the Registration Statements
or the prospectus included therein or for additional information;
(iii) of the
issuance by the SEC of any stop order suspending the effectiveness of the
Registration Statements or the initiation of any proceedings for such
purpose;
(iv) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Registrable Securities included therein for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; and
(v) of the
occurrence of any event that requires the making of any changes in the
Registration Statements or the prospectus so that, as of such date, the
statements therein are not misleading and do not 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
were made) not misleading;
(c) use its
commercially reasonable efforts to prevent the issuance of and obtain the
withdrawal of any order suspending the effectiveness of any Registration
Statement as soon as reasonably practicable;
(d) if a
Holder so requests in writing, promptly furnish to each such Holder, without
charge, at least one copy of such Registration Statement(s) and any
post-effective amendment thereto, including financial statements and schedules
and, if explicitly requested, all exhibits in the form filed with the
SEC;
-30-
(e) during
the Registration Period, promptly deliver to each such Holder, without charge,
as many copies of the prospectus included in such Registration Statements and
any amendments or supplements thereto as such Holder may reasonably request in
writing; and the Company consents to the use, consistent with the provisions
hereof, of the prospectus or any amendment or supplement thereto by each of the
selling Holders of Registrable Securities in connection with the offering and
sale of the Registrable Securities covered by the prospectus or any amendment or
supplement thereto;
(f) during
the Registration Period, if a Holder so requests in writing, promptly deliver to
each such Holder, without charge one copy of the following documents, other than
those documents available via XXXXX: (i) its annual report to its
shareholders, if any (which annual report shall contain financial statements
audited in accordance with GAAP in the United States of America by a firm of
certified public accountants of recognized standing), (ii) if not included in
substance in its annual report to shareholders, its annual report on Form 00-X
(xx xxxxxxx xxxx), (xxx) its definitive proxy statement with respect to its
annual meeting of shareholders, (iv) each of its interim reports to its
shareholders and, if not included in substance in its interim reports to
shareholders, its interim report on Form 6-K (or similar form);
(g) prior to
any public offering of Registrable Securities pursuant to either Registration
Statement, promptly take such actions as may be necessary to register or qualify
or obtain an exemption for the offer and sale under the securities or blue sky
laws of such United States jurisdictions as any such Holders reasonably request
in writing, provided
that the Company shall not for any such purpose be required to qualify generally
to transact business as a foreign corporation in any jurisdiction where it is
not so qualified or to consent to general service of process in any such
jurisdiction, and do any and all other acts or things reasonably necessary or
advisable to enable the offer and sale in such jurisdictions of the Registrable
Securities covered by such Registration Statement;
(h) upon the
occurrence of any event contemplated by Section 6.4(b)(v) above, except for such
times as the Company is permitted hereunder to suspend the use of the prospectus
forming part of the Registration Statements, use its commercially reasonable
efforts to prepare as soon as reasonably practicable a post-effective amendment
to the Registration Statements or a supplement to the related prospectus, or
file any other required document so that, as thereafter delivered to purchasers
of the Registrable Securities included therein, the prospectus will not include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(i) otherwise
use its commercially reasonable efforts to comply in all material respects with
all applicable rules and regulations of the SEC which could affect the sale of
the Registrable Securities;
(j) use its
commercially reasonable efforts to cause all Registrable Securities to be listed
on Nasdaq;
-31-
(k) use its
commercially reasonable efforts to take all other steps necessary to effect the
registration of the Registrable Securities contemplated hereby and to enable the
Holders to sell Registrable Securities under Rule 144;
(l) provide
to each Purchaser and its representatives, if requested, the opportunity to
conduct a reasonable inquiry of the Company’s financial and other records during
normal business hours and make available its officers, directors and employees
for questions regarding information which such Purchaser may reasonably request
in order to conduct any due diligence obligation on its part; and
(m) permit a
single counsel for the Purchasers to review the Registration Statements and all
amendments and supplements thereto, within two Business Days prior to the filing
thereof with the SEC;
provided that, in the case of
clauses (l) and (m) above, the Company shall not be required (A) to delay the
filing of the Registration Statements or any amendment or supplement thereto as
a result of any ongoing diligence inquiry by or on behalf of a Holder or to
incorporate any comments to the Registration Statements or any amendment or
supplement thereto by or on behalf of a Holder if such inquiry or comments would
require a delay in the filing of such Registration Statements, amendments or
supplements, as the case may be, or (B) to provide, and shall not provide, any
Purchaser or its representatives with material, non-public information unless
such Purchaser agrees to receive such information and enters into a written
confidentiality agreement with the Company in a form reasonably acceptable to
the Company.
SECTION
6.5. Limitations on Restraining
Registration. Neither the Company nor any Holder shall have
any right to take any action to restrain, enjoin or otherwise delay any
registration pursuant to Section 6.1 hereof as a result of any controversy that
may arise with respect to the interpretation or implementation of this
Agreement.
SECTION
6.6. Indemnification.
(a) Indemnification by the
Company. To
the extent permitted by law, the Company shall indemnify each Holder, each of
such Holder’s officers and directors, and each Person controlling such Holder
within the meaning of Section 15 of the Securities Act, with respect to any
registration that has been effected pursuant to this Agreement, against all
claims, losses, damages and liabilities (and all Proceedings in respect
thereof), including any of the foregoing incurred in settlement of any
Proceeding, commenced or threatened (subject to Section 6.6(c) below), arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in the Registration Statements, prospectuses, any
amendments or supplements thereof, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances in
which they were made, not misleading, and will reimburse each Holder and each
Person controlling such Holder for reasonable legal and other out-of-pocket
expenses reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or Proceeding, as such expenses are
incurred; provided that
the Company will not be liable in any such case to the extent that any untrue
statement or omission or allegation thereof is made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Holder for use in preparation of such Registration Statements,
prospectuses, amendments or supplements; and
-32-
provided, further, that the
Company will not be liable in any such case where the claim, loss, damage or
liability arises out of or is related to the failure of such Holder to comply
with the covenants and agreements of such Holder contained in this Agreement
respecting sales of Registrable Securities, and except that the foregoing
indemnity agreement is subject to the condition that, insofar as it relates to
any such untrue statement or alleged untrue statement or omission or alleged
omission made in the preliminary prospectuses but eliminated or remedied in the
amended prospectuses on file with the SEC at the time the Registration
Statements become effective or in the amended prospectuses filed with the SEC
pursuant to Rule 424(b) or in the prospectuses subject to completion under Rule
434 of the Securities Act, which together meet the requirements of Section 10(a)
of the Securities Act (the “Final Prospectuses”), such
indemnity shall not inure to the benefit of any such Holder or any controlling
Person of such Holder, if a copy of the Final Prospectuses furnished by the
Company to the Holder for delivery was required to be but was not furnished to
the Person or entity asserting the loss, liability, claim or damage at or prior
to the time such furnishing is required by the Securities Act and the Final
Prospectuses would have cured the defect giving rise to such loss, liability,
claim or damage.
(b) Indemnification by the
Holder. To
the extent permitted by law, each Holder will severally, and not jointly,
indemnify the Company, each of its directors and officers, and each Person who
controls the Company within the meaning of Section 15 of the Securities Act,
against all claims, losses, damages and liabilities (and all Proceedings in
respect thereof), including any of the foregoing incurred in settlement of any
Proceeding, commenced or threatened (subject to Section 6.6(c) below), arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in the Registration Statements, prospectuses, or any
amendments or supplements thereof, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in the light of the
circumstances in which they were made, and will reimburse the Company, such
directors and officers, and each Person controlling the Company for reasonable
legal and any other expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or
Proceeding, as such expenses are incurred, in each case to the extent, but only
to the extent, that such untrue statement or omission or allegation thereof is
made in reliance upon and in conformity with written information furnished to
the Company by or on behalf of the Holder for use in preparation of the
Registration Statements, prospectuses, amendments or supplements; provided that the indemnity
shall not apply to the extent that such claim, loss, damage or liability results
from the fact that a current copy of the prospectuses was not made available to
the person or entity asserting the loss, liability, claim or damage at or prior
to the time such furnishing is required by the Securities Act and the Final
Prospectuses would have cured the defect giving rise to such loss, claim, damage
or liability. Notwithstanding the foregoing, a Holder’s aggregate
liability pursuant to this subsection (b) and subsection (d) shall be limited to
the net amount received by the Holder from the sale of the Registrable
Securities.
(c) Conduct of Indemnification
Proceedings. Each party entitled to
indemnification under this Section 6.6 (for purposes of this Section 6.6, the
“Indemnified Party”)
shall give notice to the party required to provide indemnification (for purposes
of this Section 6.6, the “Indemnifying Party”) promptly
after such Indemnified Party has actual knowledge of any claim as to which
indemnity may be sought, and shall permit the Indemnifying Party (at its
expense) to assume the defense of any such claim or any Proceeding resulting
therefrom, provided
that counsel for the Indemnifying Party, who shall conduct the defense of such
claim or Proceeding, shall be approved by the Indemnified Party (whose approval
shall not unreasonably be withheld), and the Indemnified Party may participate
in such defense at such Indemnified Party’s expense, and provided further that the
failure of any Indemnified Party to give notice as provided
-33-
herein
shall not relieve the Indemnifying Party of its obligations under this
Agreement, unless such failure is materially prejudicial to the Indemnifying
Party in defending such claim or litigation. An Indemnifying Party
shall not be liable for any settlement of an action or claim effected without
its written consent (which consent will not be unreasonably
withheld). No Indemnifying Party, in its defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party and Indemnifying Party of a release from all liability in
respect to such claim or litigation or which admits liability or fault on the
part of the Indemnified Party.
(d) Contribution. If
the indemnification provided for in this Section 6.6 is held by a court of
competent jurisdiction to be unavailable to an Indemnified Party with respect to
any loss, liability, claim, damage or expense referred to therein, then the
Indemnifying Party, in lieu of indemnifying such Indemnified Party thereunder,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such loss, liability, claim, damage or expense in such proportion as
is appropriate to reflect the relative fault of the Indemnifying Party on the
one hand and of the Indemnified Party on the other in connection with the
statements or omissions which resulted in such loss, liability, claim, damage or
expense as well as any other relevant equitable considerations. The
relative fault of the Indemnifying Party and of the Indemnified Party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the Indemnifying Party or by the Indemnified
Party and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(e) Survival. The
provisions of this Section 6.6 shall remain in full force and effect, and shall
survive the sale by a Holder of Registrable Securities covered by the
Registration Statements.
SECTION
6.7. Dispositions.
(a) Each
Holder agrees that, upon receipt of any notice from the Company of the happening
of any event requiring the preparation of a supplement or amendment to a
prospectus relating to Registrable Securities so that, as thereafter delivered
to the Holders, such prospectus shall not contain an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, each Holder will
forthwith discontinue disposition of Registrable Securities pursuant to the
Registration Statements and prospectuses contemplated by Section 6.1 until its
receipt of copies of the supplemented or amended prospectus from the Company
and, if so directed by the Company, each Holder shall deliver to the Company all
copies, other than permanent file copies then in such Holder’s possession, of
the prospectus covering such Registrable Securities current at the time of
receipt of such notice.
(b) Each
Holder shall suspend, upon request of the Company, any disposition of
Registrable Securities pursuant to the Registration Statements and prospectuses
contemplated by Section 6.1 during no more than two periods of no more than 60
calendar days each during any 12-month period to the extent that the Company’s
Board of Directors determines in good faith that the sale of Registrable
Securities under the Registration Statements would be reasonably likely to cause
a violation of the Securities Act or Exchange Act.
-34-
(c) As a
condition to the inclusion of its Registrable Securities in the Registration
Statements, each Holder shall timely furnish to the Company such information
regarding such Holder and the distribution proposed by such Holder as the
Company may reasonably request in writing, including completing a Registration
Questionnaire in the form provided by the Company, or as shall be required in
connection with any registration referred to in this Article 6.
(d) Each
Holder hereby covenants with the Company not to make any sale of the Registrable
Securities under the Registration Statements without effectively causing the
prospectus delivery requirements under the Securities Act to be
satisfied.
(e) Each
Holder acknowledges and agrees that the Registrable Securities sold pursuant to
the Registration Statements are not transferable on the books of the depositary
in the form of ADSs except in accordance with the Depositary
Letter. Each Holder further acknowledges and agrees that the only
public market in the Registrable Securities in the U.S. is in the form of ADSs
and that no Registrable Securities may be deposited into the Company’s ADS
facility other than in compliance with the legend described in Section 3.8(a)
hereof.
(f) Each
Holder agrees not to take any action with respect to any distribution deemed to
be made pursuant to such Registration Statements that would constitute a
violation of Regulation M under the Exchange Act or any other applicable rule,
regulation or law.
(g) Following
termination of the Registration Period, the Holders shall discontinue sales of
Ordinary Shares and/or ADSs pursuant to the Registration Statements upon receipt
of notice from the Company of its intention to remove from registration the
Ordinary Shares and/or ADSs covered by such Registration Statements that remain
unsold, and such Holders shall notify the Company of the number of Ordinary
Shares and/or ADSs registered that remain unsold promptly following receipt of
such notice from the Company.
SECTION
6.8. Registration
Exemptions. With a view to making available to the Holders the
benefits of certain rules and regulations of the SEC which at any time permit
the sale of the Registrable Securities to the public without registration, so
long as any Holder still owns Registrable Securities, the Company shall use its
commercially reasonable efforts to:
(a) make and
keep public information available, as those terms are understood and defined in
Rule 144, at all times;
(b) file with
the SEC in a timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act; and
(c) so long
as a Holder owns any Registrable Securities, furnish to such Holder, upon any
reasonable request, a written statement by the Company as to its compliance with
clauses (a) and (b) of this Section 6.8, a copy of the most recent annual report
of the Company, and such other reports and documents of the Company as such
Holder may reasonably request in availing itself of any rule or regulation of
the SEC allowing a Holder to sell any such securities without
registration.
-35-
SECTION
6.9. Assignment. The
rights to cause the Company to register Registrable Securities granted to the
Holders by the Company under Section 6.1 may be assigned by a Holder in
connection with a transfer by such Holder of all or a portion of its Registrable
Securities; provided,
that (i) such transfer must be effected in accordance with applicable securities
laws; (ii) such transferee must agree to comply with the terms and provisions of
this Agreement, and (iii) such transfer must be otherwise in compliance with
this Agreement. Except as specifically permitted by this Section 6.9,
the rights of a Holder with respect to Registrable Securities as set out herein
shall not be transferable to any other Person.
SECTION
6.10. Waiver/Amendment. The
rights of any Holder under any provision of this Article 6 may be waived (either
generally or in a particular instance, either retroactively or prospectively and
either for a specified period of time or indefinitely) or amended by an
instrument in writing signed by such Holder.
SECTION
6.11. Piggy-Back
Registrations. If at any time prior to the end of the
Registration Period (including during periods when the Company is permitted to
suspend the use of the prospectus forming part of the Registration Statements)
there is not an effective Registration Statement covering all of the Registrable
Securities, the Company shall determine to prepare and file with the SEC a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the Securities
Act) or their then equivalents relating to equity securities to be issued solely
in connection with any acquisition of any entity or business or equity
securities issuable in connection with stock option or other employee benefit
plans, then the Company shall send to each Holder written notice of such
determination and if, within twenty days after receipt of such notice, any such
Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
Holder requests to be registered. Notwithstanding the foregoing, in
the event that, in connection with any underwritten public offering, the
managing underwriter(s) thereof shall impose a limitation on the number of
Ordinary Shares which may be included in the registration statement because, in
such underwriter(s)’ judgment, marketing or other factors dictate such
limitation is necessary to facilitate public distribution, then the Company
shall be obligated to include in such registration statement only such limited
portion of the Registrable Securities with respect to which such Holder has
requested inclusion hereunder as the underwriter shall permit; provided, however, that (i) except in
accordance with the underwriter cutbacks described in Schedule 2.18 of the
Disclosure Schedules, the Company shall not exclude any Registrable Securities
unless the Company has first excluded all outstanding securities which are not
Registrable Securities and (ii) after giving effect to the immediately preceding
proviso, any such exclusion of Registrable Securities shall be made pro rata
among the Holders seeking to include Registrable Securities and the holders of
other securities having the contractual right to inclusion of their securities
in such registration statement by reason of demand registration rights, in
proportion to the number of Registrable Securities or other securities, as
applicable, sought to be included by each such Holder or other
holder. If an offering in connection with which a Holder is entitled
to registration under this Section 6.11 is an underwritten offering, then each
Holder whose Registrable Securities are included in such registration statement
shall, unless otherwise agreed by the Company, offer and sell such Registrable
Securities using the same underwriter or underwriters and, subject to the
provisions of this Agreement, on the same terms and conditions as other
securities of the Company included in such underwritten offering and shall enter
into an underwriting agreement in a form and substance reasonably satisfactory
to the Company and the underwriter or underwriters. Upon the
effectiveness of the registration statement for which piggy-back registration
has been provided in this Section 6.11,
-36-
any
payments that after such effectiveness date would otherwise become payable
pursuant to Section 6.3 to a Purchaser whose Securities are included in such
registration statement shall not become payable so long as such piggy-back
registration statement remains effective.
ARTICLE
7
GENERAL
INDEMNIFICATION
SECTION
7.1. Indemnification by the
Company. The Company shall indemnify each Purchaser and each
of such Purchaser’s officers, directors, partners and members against all
claims, losses, damages and liabilities incurred as a result of or in settlement
of any Proceeding, commenced or threatened (subject to Section 7.3 below), to
the extent related to or arising out of any breach of any representation or
warranty made by the Company in this Agreement or any failure to perform or
breach by the Company of any covenant, obligation, or undertaking made by the
Company in this Agreement, it being understood
that such losses
and damages may, if proven, include, without limitation, any diminution in value
of the Securities to the extent related to or arising out of any such breach or
failure to perform, and will reimburse each such indemnified party for all
reasonable legal and other out-of-pocket expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such claim,
loss, damage, liability or Proceeding, as such expenses are
incurred.
SECTION
7.2. Indemnification by Each
Purchaser. Each Purchaser will severally, and not jointly,
indemnify the Company and each of its directors and officers against all claims,
losses, damages and liabilities, including any of the foregoing incurred as a
result of or in settlement of any Proceeding, commenced or threatened (subject
to Section 7.3 below), to the extent related to or arising directly or
indirectly out of any breach of any representation or warranty made by such
Purchaser in this Agreement or any failure to perform or breach by such
Purchaser of any covenant, obligation, or undertaking made by such Purchaser in
this Agreement and will reimburse such indemnified party for all reasonable
legal and other out-of-pocket expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such claim, loss,
damage, liability or Proceeding, as such expenses are incurred.
SECTION
7.3. Conduct of Indemnification
Proceedings. Each party entitled to indemnification under this
Article 7 (for purposes of this Section 7.3, the “Indemnified Party”) shall give
notice to the party required to provide indemnification (for purposes of this
Section 7.3, the “Indemnifying
Party”) promptly after such Indemnified Party has actual
knowledge of any claim as to which indemnity may be sought, and shall permit the
Indemnifying Party (at its expense) to assume the defense of any such claim or
any Proceeding resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or Proceeding, shall be
approved by the Indemnified Party (whose approval shall not be unreasonably
withheld or delayed), and the Indemnified Party may participate in such defense
at such Indemnified Party’s expense, and provided further that the failure of
any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Article 7, unless such failure
is materially prejudicial to the Indemnifying Party in defending such claim or
litigation. An Indemnifying Party shall not be liable for any
settlement of an action or claim affected without its written consent (which
consent will not be unreasonably withheld). No Indemnifying Party, in
its defense of any such claim or litigation, shall, except with the consent of
each Indemnified Party, consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Indemnified Party and Indemnifying Party of a
release from all liability in respect to such claim or litigation or which
admits liability or fault on the part of the Indemnified Party.
-37-
ARTICLE
8
DEFINITIONS
“ADS” and “ADSs” have the respective
meanings set forth in Section 1.1(a).
“Affiliate” means, with respect
to any Person, any other Person controlling, controlled by or under direct or
indirect common control with such Person (for the purposes of this definition
“control,” when used
with respect to any specified Person, shall mean the power to direct the
management and policies of such Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” shall have
meanings correlative to the foregoing).
“Business Day” means a day
Monday through Friday on which banks are generally open for business in New York
City and London, England.
“Company” means Amarin
Corporation plc, a company incorporated under the laws of England and
Wales.
“Debentures” has the meaning
set forth in Section 1.4.
“Depositary Letter” means the
letter agreement between the Company and Citibank, N.A. dated as of the First
Closing Date.
“Disclosure Schedules” means
the Disclosure Schedules of the Company attached hereto.
“Draft Annual Report” has the
meaning set forth in Section 2.7.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
“Exempt Securities” means (i)
options granted, and shares issued upon exercise thereof, to employees,
directors or consultants under the Company’s stock option plans in amounts
approved by the Company’s Board of Directors upon the recommendation of its
remuneration committee (as appropriately adjusted for stock splits, stock
dividends, and the like), (ii) securities offered under a registration statement
on Form F-4 (or any applicable successor form), (iii) the conversion or exercise
of convertible debt or exercisable securities outstanding on the date hereof as
set forth in Schedule 2.27 of the Disclosure Schedules (iv) the issuance of
Ordinary Shares to pay milestones which may become payable in relation to the
acquisitions by the Company of Laxdale Limited and Ester Neurosciences Ltd. as
set forth on Schedule 2.26 of the Disclosure Schedules, (v) the issuance of
shares in connection with bank financing or similar transactions that are
primarily of a non-equity financing nature and approved by the Company’s Board
of Directors, and (vi) securities issued pursuant to acquisitions or strategic
transactions approved by the Supermajority Directors.
“Final Prospectus” has the
meaning set forth in Section 6.6(a).
-38-
“Financial Statements” means
the financial statements of the Company included in the SEC Documents and the
Draft Annual Report.
“First Closing” has the meaning
set forth in the Recitals.
“First Closing Amount” has the
meaning set forth in the Recitals.
“First Closing Date” has the
meaning set forth in Section 1.3.
“First Closing Purchase Price”
has the meaning set forth in Section 1.2.
“First Closing Securities” has
the meaning set forth in Section 1.1(a).
“First Filing Date” has the
meaning set forth in Section 6.1(a).
“Governmental Authority” means
any governmental body or regulatory authority of the United States or any other
country or any political subdivision of any thereof.
“Holders” means any Person
holding Registrable Securities or any Person to whom the rights under Article 6
have been transferred in accordance with Section 6.9 hereof.
“Indebtedness” means, as
applied to any Person, all indebtedness of such Person for borrowed money,
whether current or funded, or secured or unsecured, excluding current trade
payables incurred in the ordinary course of business consistent with past
practice, but including, (i) all obligations of that Person evidenced by bonds,
debentures, notes, or other similar instruments or debt securities, (ii) all
indebtedness of that Person secured by a purchase money mortgage or other Lien
to secure all or part of the purchase price of the property subject to such
Lien, (iii) all obligations under leases that shall have been or must be
recorded as capital leases in respect of which such Person is liable as lessee,
(iv) any liability of that Person in respect of banker’s acceptances or letters
of credit, and (v) all indebtedness referred to above which is directly or
indirectly guaranteed by that Person or
-39-
which
that Person has agreed (contingently or otherwise) to purchase or otherwise
acquire or in respect of which it has otherwise assured a creditor against
loss.
“Indemnified Party” has the
meaning set forth in Section 6.6(c).
“Indemnifying Party” has the
meaning set forth in Section 6.6(c).
“Intellectual Property Rights”
has the meaning set forth in Section 2.9.
“Investment Company Act” has
the meaning set forth in Section 2.11.
“Liens” means a lien, charge,
security interest, encumbrance, right of first refusal, preemptive right, claim,
defect or imperfection of title or similar restriction.
“Majority of the Preference Share
Purchasers” means (i) prior to the First Closing, two-thirds (2/3) of the
Purchasers purchasing Preference Shares (based on the aggregate “Pro Rata
Percentages” of the Purchasers as set forth on Exhibit
A hereto) and (ii) from and after the First Closing, the Purchasers who
purchased Preference Shares holding two-thirds (2/3) of the Securities sold
hereunder.
“Material Adverse Effect” has
the meaning set forth in Section 2.1.
“Material Contracts” has the
meaning set forth in Section 4.1(b).
“Material Permits” has the
meaning set forth in Section 2.5(c).
“Memorandum and Articles of
Association” has the meaning set forth in Section 2.3.
(a) “Milestone” means that the
Company has ********** Approximately 2 lines omitted **********.
“Nasdaq” means The Nasdaq
Capital Market.
“Net Proceeds” has the meaning
set forth in Section 4.13(b).
“Non-US Person” has the meaning
set forth in Section 3.2.
“Notice” has the meaning set
forth in Section 1.1(c).
“Ordinary Shares” means the
ordinary shares, par value ₤0.50 per share, of the Company.
“Per Share First Closing Purchase
Price” has the meaning set forth in Section 1.1(a).
CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS (*) DENOTE SUCH OMISSIONS.
WITH THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS (*) DENOTE SUCH OMISSIONS.
-40-
“Per Share Second Closing Purchase
Price” has the meaning set forth in Section 1.1(b).
“Person” means any person,
individual, corporation, limited liability company, partnership, trust or other
nongovernmental entity or any governmental agency, court, authority or other
body (whether foreign, federal, state, local or otherwise).
“Placement Agent” means,
collectively, Xxxxx and Company LLC and Xxxxxx and Xxxxxxx LLC.
“Preference Shares” means the
Preference Shares to be issued to the Purchasers at the First Closing having the
rights, preferences and other characteristics set forth on Exhibit D.
“Proceeding” means any action,
claim, suit, inquiry, notice of violation, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
“Purchasers” mean the
Purchasers whose names are set forth on the signature pages of this Agreement
and are listed on Exhibit
A hereto, and their permitted transferees.
Unless
the context requires otherwise, the terms “register,” “registered” and “registration” refer to the
registration of securities of the Company effected by preparing and filing a
registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration
statement.
“Registrable Securities” means
the First Closing Ordinary Shares and the Second Closing Securities; provided, however, that securities
shall only be treated as Registrable Securities if and only for so long as they
(A) have not been disposed of pursuant to a registration statement declared
effective by the SEC, (B) have not been sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act so that
all transfer restrictions and restrictive legends with respect thereto are
removed upon the consummation of such sale or (C) are held by a Holder or a
permitted transferee pursuant to Section 6.9.
“Registration Expenses” means
all expenses incurred by the Company in complying with Section 6.1 hereof,
including, without limitation, all registration, qualification and filing fees,
printing expenses, escrow fees, fees and expenses of counsel for the Company,
blue sky fees and expenses and the expense of any special audits incident to or
required by any such registration (but excluding the fees of legal counsel for
any Holder).
“Registration Period” has the
meaning set forth in Section 6.4(a).
“Registration Statement” has
the meaning set forth in Section 6.1(b).
“Required Approvals” has the
meaning set forth in Section 2.5(b).
“Rule 144” means Rule 144
promulgated under the Securities Act.
“SEC” means the United States
Securities and Exchange Commission.
-41-
“SEC Documents” has the meaning
set forth in Section 2.6.
“Second Closing” has the
meaning set forth in the Recitals.
“Second Closing Amount” has the
meaning set forth in the Recitals.
“Second Closing Date” has the
meaning set forth in Section 1.3.
“Second Closing Purchase Price”
has the meaning set forth in Section 1.2.
“Second Closing Securities” has
the meaning set forth in Section 1.1(b).
“Second Filing Date” has the
meaning set forth in Section 6.1(b).
“Securities” has the meaning
set forth in Section 1.1(b).
“Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
“Selling Expenses” means all
selling commissions applicable to the sale of Registrable Securities and all
fees and expenses of legal counsel for any Holder other than as set forth in the
definition of “Registration Expenses.”
“Shortfall Amount” has the
meaning set forth in Section 1.1(c).
“Special Rights Termination
Event” shall mean either (i) the failure of the Purchasers to timely
exercise their option to fund the Second Closing Amount pursuant to Section
1.1(c) or (ii) the timely exercise of such option by the Purchasers followed by
the failure of the Second Closing to occur due to the failure of the Purchasers
to satisfy any of the conditions provided in Sections 5.3(a)-(c).
“Subsidiary” of any Person
shall mean any corporation, partnership, limited liability company, joint
venture or other legal entity of which such Person (either alone or through or
together with any other subsidiary) owns, directly or indirectly, more than 50%
of the stock or other equity interests the holders of which are generally
entitled to vote for the election of the board of directors or other governing
body of such corporation or other legal entity.
“Termination Date” has the
meaning set forth in Section 9.1(b).
ARTICLE
9
TERMINATION
SECTION
9.1. Termination. This
Agreement may be terminated:
(a) by the
mutual written consent of the Company and a Majority of the Preference Share
Preference Share Purchasers;
-42-
(b) by either
the Company or a Majority of the Preference Share Purchasers, if the First
Closing has not been consummated by May 31, 2008 (the “Termination Date”); provided, however, that the right to
terminate this Agreement pursuant to this Section 9.1(b) shall not be available
to any party(ies) who is in material breach of this Agreement, or whose failure
to fulfill any of its obligations under this Agreement results in such failure
to close;
(c) by either
the Company or a Majority of the Preference Share Purchasers, if any applicable
law makes consummation of the transactions contemplated hereby illegal, or if
any judgment, injunction, order, or decree enjoining any party hereto from
consummating the transactions contemplated hereby is entered and that judgment,
injunction, order, or decree becomes final and nonappealable; provided, however, that the party(ies)
seeking to terminate this Agreement pursuant to this subsection
9.1(c) shall have used all reasonable efforts to remove such judgment,
injunction, order or decree;
(d) by the
Company, if the Company is not in material breach of this Agreement, in the
event of a material breach by any Purchaser of any representation, warranty, or
agreement contained herein; or
(e) by a
Majority of the Preference Share Purchasers, if a Majority of the Preference
Share Purchasers are not in material breach of this Agreement, in the event of a
material breach by the Company of any representation, warranty, or agreement
contained herein.
SECTION
9.2. Effect of
Termination. If this Agreement is validly terminated pursuant
to Section 9.1, it shall become null and void immediately and there shall be no
liability or obligation to any Person in respect of the Agreement or of the
transactions contemplated hereby on the part of any party, or a party’s
directors, officers, employees, agents, representatives, advisers, stockholders,
members, partners, or Affiliates, except that the provisions of this Section 9.2
and Article 10 shall remain in full force and effect and shall survive any
termination of this Agreement and except that each party shall remain liable for
any breach of this Agreement prior to its termination.
ARTICLE
10
GOVERNING
LAW; MISCELLANEOUS
SECTION
10.1. Governing Law; Jurisdiction; Waiver
of Jury Trial.
(a) This
Agreement will be governed by and interpreted in accordance with the laws of the
State of New York without regard to the principles of conflict of laws that
would yield a contrary result.
(b) Each
party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement
(whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced exclusively in
the state and federal courts sitting in the City of New York. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or therewith or
with any transaction contemplated hereby or
-43-
thereby,
and hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, or that such suit, action or proceeding is improper or is an
inconvenient venue for such proceeding. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) 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 contained herein shall be deemed to limit in any way
any right to serve process in any other manner permitted by law.
(c) In any
action, suit or proceeding in any jurisdiction brought by any party against any
other party under this Agreement, the parties each knowingly and intentionally,
to the greatest extent permitted by applicable law, hereby waive all rights to
trial by jury.
(d) If any
action, suit or proceeding is instituted to enforce any provision in this
Agreement, the prevailing party in such dispute shall, to the extent permitted
by New York law, be entitled to recover from the losing party all fees, costs
and expenses of enforcing any right of such prevailing party under or with
respect to this Agreement, including, without limitation, such reasonable fees
and expenses of attorneys and accountants, which shall include, without
limitation, all fees, costs and expenses of appeals.
SECTION
10.2. Counterparts;
Signatures. This Agreement may be executed in two or more
counterparts, all of which are considered one and the same agreement and will
become effective when counterparts have been signed by each party and delivered
to the other parties. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original thereof.
SECTION
10.3. Headings. The
headings of this Agreement are for convenience of reference only, are not part
of this Agreement and do not affect its interpretation.
SECTION
10.4. Severability. If
any provision of this Agreement is invalid or unenforceable under any applicable
statute or rule of law, then such provision will be deemed modified in order to
conform with such statute or rule of law. Any provision hereof that
may prove invalid or unenforceable under any law will not affect the validity or
enforceability of any other provision hereof.
SECTION
10.5. Entire Agreement;
Amendments. This Agreement (including all schedules and
exhibits hereto) constitutes the entire agreement among the parties hereto with
respect to the subject matter hereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein. This Agreement supersedes all prior agreements and
understandings among the parties hereto with respect to the subject matter
hereof. No provision of this Agreement may be amended or waived other
than by an instrument in writing signed by the Company and Purchasers holding at
least two-thirds (2/3) of the then outstanding Securities or, in the case of
Article 6, the Holders of at least two-thirds (2/3) of the outstanding
Registrable Securities, or in the case of a waiver, by the party against whom
enforcement of such waiver is sought. Any amendment effected in
accordance with this Section 10.5 shall be binding upon the Company and the
Purchasers or, in the case of Article 6, the Holders.
-44-
SECTION
10.6. Notices. All
notices required or permitted hereunder shall be in writing and shall be deemed
effectively given: (a) upon personal delivery to the party to be
notified, (b) when sent by confirmed facsimile if sent during normal business
hours of the recipient, and if not, then on the next business day, (c) five days
after having been sent by registered or certified mail, return receipt
requested, postage prepaid, or (d) one Business Day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. The addresses for such
communications are:
|
If
to the Company:
|
|
Amarin
Corporation plc
0
Xxxxxx Xxxxxx
Xxxxxx
X0X 0XX
Xxxxxxx
Facsimile: 00-00-0000-0000
Attn: Chief
Financial Officer
cc: General
Counsel
|
|
With
a copy (which shall not constitute notice) to:
|
|
Xxxxxx
Xxxxxx & Xxxxxxx LLP
00
Xxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000-0000
Facsimile: 212-269-5420
Attn: Xxxxxxxx
X. Xxxxxxxx
|
If to a
Purchaser: To the address set forth immediately below such
Purchaser’s name on the signature pages hereto. Each party will
provide ten (10) days’ advance written notice to the other parties of any change
in its address.
SECTION
10.7. Successors and
Assigns. This Agreement is binding upon and inures to the
benefit of the parties and their successors and assigns. The Company
or its successors will not assign this Agreement or any rights or obligations
hereunder without the prior written consent of the Purchasers, and no Purchaser
may assign this Agreement or any rights or obligations hereunder (including the
option to fund the Second Closing Amount and the Preference Shares) without the
prior written consent of the Company, except that, as permitted in accordance
with Section 3.7 and Section 6.9 hereof and subject to applicable securities
laws, the Purchasers shall be entitled to assign and transfer, without any other
person’s or the Company’s consent and without restriction, all or any portion of
the Securities (exclusive of the Preference Shares).
SECTION
10.8. Third Party
Beneficiaries. This Agreement is intended for the benefit of
the parties hereto, their respective permitted successors and assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person.
SECTION
10.9. Further
Assurances. Each party will do and perform, or cause to be
done and performed, all such further acts and things, and will execute and
deliver all other
-45-
agreements,
certificates, instruments and documents, as may be necessary in order to carry
out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
SECTION
10.10. No Strict
Construction. The language used in this Agreement is deemed to
be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.
SECTION
10.11. Equitable
Relief. The Company recognizes that, if it fails to perform or
discharge any of its obligations under this Agreement, any remedy at law may
prove to be inadequate relief to the Purchasers. The Company
therefore agrees that the Purchasers are entitled to seek temporary and
permanent injunctive relief in any such case. Each Purchaser also
recognizes that, if it fails to perform or discharge any of its obligations
under this Agreement, any remedy at law may prove to be inadequate relief to the
Company. Each Purchaser therefore agrees that the Company is entitled
to seek temporary and permanent injunctive relief in any such case.
SECTION
10.12. Survival of Representations and
Warranties. All representations and warranties made by the
Company and the Purchasers herein shall survive the First Closing and the Second
Closing.
SECTION
10.13. Fractional
Securities. No fractional Securities shall be issued at the
Second Closing. The Company shall, in lieu of issuing any fractional
Securities, pay the Purchaser otherwise entitled to such fraction a sum in cash
equal to the product resulting from multiplying the Per Share Second Closing
Purchase Price by such fraction.
SECTION
10.14. Independent Nature of Purchasers’
Obligations and Rights. The obligations of each Purchaser
under this Agreement are several and not joint with the obligations of any other
Purchaser, and no Purchaser shall be responsible in any way for the performance
of the obligations of any other Purchaser under this
Agreement. Nothing contained herein and no action taken by any
Purchaser pursuant thereto shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert or as
a group, or are deemed affiliates (as such term is defined under the Exchange
Act) with respect to such obligations or the transactions contemplated by this
Agreement. Each Purchaser shall be entitled to independently protect
and enforce its rights, including without limitation the rights arising out of
this Agreement, and it shall not be necessary for any other Purchaser to be
joined as an additional party in any proceeding for such purpose.
SECTION
10.15. Notice to Purchasers Not Receiving
Preference Shares. Notwithstanding any other provision of this
Agreement, upon any vote or action by Purchasers with respect to which Fountain
Healthcare Partners Fund 1, L.P. does not have a right to participate,
including, without limitation a vote or action of the Majority of the Preference
Share Purchasers, the Company shall deliver notice of the outcome of such vote
or action promptly upon it becoming aware of the outcome of such vote or action
to Fountain Healthcare Partners Fund 1, L.P.
[Signature
Pages Follow]
-46-
IN
WITNESS WHEREOF, the undersigned Purchasers and the Company have caused this
Agreement to be duly executed as of the date first above written.
|
AMARIN
CORPORATION PLC
|
|
By:
Name:
Title:
|
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE
PAGE FOR PURCHASER FOLLOWS]
[PURCHASER
SIGNATURE PAGES TO AMARIN SECURITIES PURCHASE AGREEMENT]
IN
WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement
to be duly executed by their respective authorized signatories as of the date
first indicated above.
|
Name
of
Purchaser: _________________________________________________________________________________
|
|
Signature of Authorized
Signatory of Purchaser:
___________________________________________________________
|
|
Name
of Authorized Signatory:
_________________________________________________________________________
|
|
Title
of Authorized Signatory:
__________________________________________________________________________
|
|
Email
Address of Purchaser:
___________________________________________________________________________
|
|
Fax
Number of Purchaser:
_____________________________________________________________________________
|
Address
for Notice of Purchaser:
Address
for Delivery of Securities for Purchaser (if not same as address for
notice):
Jurisdiction
of Incorporation:
EIN
Number: [PROVIDE
THIS UNDER SEPARATE COVER]
EXHIBIT
A
SCHEDULE
OF PURCHASERS
|
Purchaser
|
Pro
Rata Percentage
|
First
Closing Committed Amount
|
First
Closing Ordinary Shares
|
Preference
Shares
|
Aggregate
First Closing Purchase Price
|
|
Total:
|
100.00%
|
$28,000,000.00
|
12,173,914
|
8
|
$28,000,002.20
|
EXHIBIT
B
Issuance of Additional Stock
for Consideration Below the Per Share Second Closing Purchase
Price.
If the
Company, at any time and from time to time, shall issue, after the date hereof
and prior to the Second Closing, any Additional Stock (as defined in Section
1.1(d)(ii)) without consideration or for a consideration per share (or with a
conversion or exercise price per share) less than the Per Share Second Closing
Purchase Price in effect immediately prior to the issuance of such Additional
Stock, then and in each such event the Per Share Second Closing Purchase Price
in effect immediately prior to each such issuance shall forthwith (except as
otherwise provided in this Exhibit B) be adjusted to a price determined by
multiplying such Per Share Second Closing Purchase Price by a fraction, the
numerator of which shall be the number of Ordinary Shares outstanding
immediately prior to such issuance plus the number of Ordinary Shares that the
aggregate consideration received by the Company for such issuance would purchase
at such Per Share Second Closing Purchase Price; and the denominator of which
shall be the number of Ordinary Shares outstanding immediately prior to such
issuance plus the number of shares of such Additional Stock.
For all
purposes of this Exhibit B, “Ordinary Shares” shall mean
Ordinary Shares as such are represented by ADSs.
(a) No
adjustment of the Per Share Second Closing Purchase Price shall be made in an
amount less than one cent per share, provided that any adjustments
that are not required to be made by reason of this sentence shall be carried
forward and shall be taken into account at the earlier of the Second Closing
Date and the date of any subsequent adjustment made pursuant to this Exhibit
B. No adjustment made pursuant to this Exhibit B shall have the
effect of increasing the Per Share Second Closing Purchase Price above the Per
Share Second Closing Purchase Price in effect immediately prior to such
adjustment.
(b) In
the case of the issuance of Ordinary Shares for cash, the consideration shall be
deemed to be the amount of cash paid therefor excluding amounts paid or payable
for accrued interest or accrued dividends.
(c) In
the case of the issuance of Ordinary Shares for a consideration in whole or in
part other than cash, the consideration other than cash shall be deemed to be
the fair value thereof as determined in good faith by a committee of the
independent directors of the Company irrespective of any accounting
treatment.
(d) In
the case of the issuance of Additional Stock consisting of options to purchase
or rights to subscribe for Ordinary Shares, securities by their terms
convertible into or exchangeable for Ordinary Shares or options to purchase or
rights to subscribe for such convertible or exchangeable securities, the
following provisions shall apply for all purposes of this Exhibit
B:
(i) The
aggregate maximum number of Ordinary Shares deliverable upon exercise (assuming
the satisfaction of any conditions to exercisability, including without
limitation, the passage of time, but without taking into account potential
antidilution adjustments) of such options to purchase or rights to subscribe for
Ordinary Shares shall be deemed to have been issued at the time such options or
rights were issued and for a consideration equal to the consideration
(determined in the manner provided in subsections (b) and (c) of this Exhibit
B), if any, received by the Company upon the issuance of such options or rights
plus the minimum exercise price provided in such options or rights (without
taking into account potential antidilution adjustments) for the Ordinary Shares
covered thereby.
(ii) The
aggregate maximum number of Ordinary Shares deliverable upon conversion of or in
exchange (assuming the satisfaction of any conditions to convertibility or
exchangeability, including, without limitation, the passage of time, but without
taking into account potential antidilution adjustments) for any such convertible
or exchangeable securities or upon the exercise of options to purchase or rights
to subscribe for such convertible or exchangeable securities and subsequent
conversion or exchange thereof shall be deemed to have been issued at the time
such securities were issued or such options or rights were issued and for a
consideration equal to the consideration, if any, received by the Company for
any such securities and related options or rights (excluding any cash received
on account of accrued interest or accrued dividends), plus the minimum
additional consideration, if any, to be received by the Company (without taking
into account potential antidilution adjustments) upon the conversion or exchange
of such securities or the exercise of any related options or rights (the
consideration in each case to be determined in the manner provided in
subsections (b) and (c) of this Exhibit B).
(iii) In
the event of any change in the number of Ordinary Shares deliverable or in the
consideration payable to the Company upon exercise of such options or rights or
upon conversion of or in exchange for such convertible or exchangeable
securities, including, but not limited to, a change resulting from the
antidilution provisions thereof, the Per Share Second Closing Purchase Price, to
the extent in any way affected by or computed using such options, rights or
securities, shall be recomputed to reflect such change, but no further
adjustment shall be made for the actual issuance of Ordinary Shares or any
payment of such consideration upon the exercise of any such options or rights or
the conversion or exchange of such securities.
(iv) Upon
the expiration of any such options or rights, the termination of any such rights
to convert or exchange or the expiration of any options or rights related to
such convertible or exchangeable securities, the Per Share Second Closing
Purchase Price, to the extent in any way affected by or computed using such
options, rights or securities or options or rights related to such securities,
shall be recomputed to reflect the issuance of only the number of Ordinary
Shares (and convertible or exchangeable securities that remain in effect)
actually issued upon the exercise of such options or rights, upon the conversion
or exchange of such securities or upon the exercise of the options or rights
related to such securities.
(v) The
number of Ordinary Shares deemed issued and the consideration deemed paid
therefor pursuant to subsections (d)(i) and (ii) above shall be appropriately
adjusted to reflect any change, termination or expiration of the type described
in either subsection (d)(iii) or (iv).
(e) Upon
each adjustment of the Per Share Second Closing Purchase Price pursuant to the
provisions of this Exhibit B, the number of Ordinary Shares issuable at the
Second Closing shall be adjusted by (A) multiplying the Per Share Second Closing
Purchase Price in effect immediately prior to such adjustment by the number of
Ordinary Shares issuable at the Second Closing immediately prior to such
adjustment and (B) dividing the product so obtained by the adjusted Per Share
Second Closing Purchase Price.
-2-
EXHIBIT
C
Form of
Opinion of Xxxxxx Xxxxxx & Xxxxxxx llp
May
[ ], 2008
and
Xxxxx and
Company, LLC
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx,
XX 00000
Xxxxxx
Xxxxxx of America
|
|
Re:
|
Amarin Corporation
plc
|
Ladies
and Gentlemen:
This
opinion is being furnished to you pursuant to Section 5.2(e) of the Securities
Purchase Agreement, dated May 13, 2008 (the “Purchase Agreement”),
between Amarin Corporation plc, a public limited company organized under the
laws of England and Wales (the “Company”), and the
various persons listed on Schedule A thereto (each, a
“Purchaser” and
collectively, the “Purchasers”),
relating to the issuance and sale to the Purchasers by the Company of ordinary
shares of ₤0.05 each in the capital of the Company (“Ordinary Shares”) and
to certain Purchasers, series a preference shares of ₤0.50 each in the capital
of the Company (“Preference Shares”
and together with the Ordinary Shares, the “Securities”). Capitalized
terms used herein and not otherwise defined herein shall have the meanings
ascribed thereto in the Purchase Agreement.
In
rendering the opinions set forth herein, we have examined originals, photocopies
or conformed copies certified to our satisfaction of all such company or
corporate records, agreements, instruments and documents of the Company and its
subsidiaries, certificates of public officials and other certificates and
opinions, and have made such other investigations, as we have deemed necessary
in connection with the opinions set forth herein. In such
examination, we have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified or photocopies or
conformed copies and the authenticity of originals of such
documents. We have relied, to the extent we deem such reliance
proper, on certificates of officers of the Company and its subsidiaries as to
factual matters.
Based
upon the foregoing, it is our opinion that:
1. no
filing with, or authorization, approval, consent, order, registration,
qualification or decree of, any United States federal or New York state court or
governmental authority or agency is required in connection with the execution,
delivery or performance by the Company of the Purchase Agreement or the
offering, issuance or sale of the Securities except (a) such as have already
been obtained and are in full force and effect, (b) any filings under U.S.
federal or state securities or Blue Sky laws in connection with the sale of the
Securities and (c) for such filings, authorizations, approvals, consents,
orders, registrations, qualifications or decrees the failure so to obtain would
not, individually or in the aggregate, have a Material Adverse Effect and would
not materially and adversely affect the consummation of the transactions
contemplated by the Purchase Agreement;
2. the
execution, delivery and performance of the Purchase Agreement by the Company,
the issuance and sale of the Securities by the Company and the consummation by
the Company of the transactions contemplated by the Purchase Agreement do not
and will not result in any violation of any United States federal or New York
State statute or any rule or regulation issued pursuant to any United States
federal or New York State court of governmental agency or body (other than U.S.
federal and state securities or Blue Sky laws and regulations relating to
FINRA), except for violations that would not, individually or in the aggregate,
have a Material Adverse Effect; and
3. assuming
(i) the accuracy of the representations and warranties of the Company contained
in the Purchase Agreement, (ii) the accuracy of the representations and
warranties of each Purchaser in the Purchase Agreement and (iii) the Placement
Agent has not engaged in any activity with respect to the Securities that would
constitute a public offering within the meaning of Section 4(2) of the
Securities Act, it is not necessary in connection with the issuance and sale of
the Securities to the Purchasers under the circumstances contemplated by the
Purchase Agreement to register the sale of the Securities to the Purchasers
under the Securities Act of 1933, as amended, it being understood that no
opinion is being expressed as to any subsequent resale of the Securities;
and
4. the
Purchase Agreement constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, subject to
applicable bankruptcy, insolvency or similar laws affecting creditors’ rights
generally and general principles of equity and except that (a) rights to
indemnification may be limited under applicable law or public policy and (b) the
enforceability of provisions imposing liquidated damages or penalties upon the
occurrence of certain events may be limited in certain
circumstances.
We are
members of the Bar of the State of New York and do not purport to be experts in,
or to express any opinion concerning, the laws of any jurisdictions other than
the laws of the State of New York and the federal laws of the United States of
America.
This
opinion is solely for your benefit as Purchasers of the Securities and as the
Placement Agent and neither this opinion nor any part hereof may be delivered to
or used or relied upon by any person other than you without our prior written
consent.
Very
truly yours,
-2-
SCHEDULE
A
List of
Recipients
|
·
|
Caduceus
Private Investments III, LP
|
|
·
|
Orbimed
Associates III, LP
|
|
·
|
Sofinnova
Venture Partners VII, L.P.
|
|
·
|
Panorama
Capital, L.P.
|
|
·
|
Xxxxxx,
XxXxxxxx & Partners II, L.P.
|
|
·
|
TMP
Nominee II, LLC
|
|
·
|
TMP
Associates II, L.P.
|
|
·
|
Longitude
Venture Partners, L.P.
|
|
·
|
Fountain
Healthcare Partners Fund 1, L.P.
|
EXHIBIT
D
SERIES
A PREFERENCE SHARES
|
1.1.
|
CONSOLIDATION
OF PREFERENCE SHARES
|
(a) It was
noted that the Company’s authorised share capital currently comprised
155,914,406 Ordinary Shares with a nominal value of 50 xxxxx each and
440,855,934 Preference Shares with a nominal value of 5 xxxxx each.
(b) The
Chairman explained that, in connection with the transactions contemplated by the
Securities Purchase Agreement, dated as of May 13, 2008, by and among Sofinnova
Venture Partners VII, L.P., Caduceus Private Investments III, LP and Orbimed
Associates III, LP and their affiliated entities, Panorama Capital, L.P.,
Thomas, XxXxxxxx & Partners II, L.P., TMP Nominees II, LLC, TMP Associates
II, L.P., and Longitude Venture Partners, L.P. (collectively, the “Purchasers”), and the Company
(the “Purchase
Agreement”), it was proposed to issue to the Purchasers Preference Shares
with a nominal value of 50 xxxxx each with certain rights attached.
(c) In
addition, it was proposed that such Preference Shares would automatically
convert into Ordinary Shares on a one-for-one basis upon the occurrence of
certain events, as described below.
(d) On that
basis, the Chairman explained that it would be necessary to consolidate certain
of the Company’s Preference Shares with a nominal value of 5 xxxxx each (the
“5 xxxxx Preference
Shares”) on a ten-for-one basis into Preference Shares with a nominal
value of 50 xxxxx each in order to allow for conversion of such Preference
Shares into Ordinary Shares on a one-for-one basis without any unlawful issue of
shares at a discount.
(e) It was
noted that, in passing the resolution to adopt article 5 of the Company’s
Articles, the Company’s shareholders had granted to the Directors authority,
inter alia, to
consolidate the 5 xxxxx Preference Shares.
(f) Pursuant
to such authority IT WAS
RESOLVED that 50 of the 5 xxxxx Preference Shares be and they are hereby
consolidated and divided into 5 Preference Shares with a nominal value of 50
xxxxx each.
|
1.2.
|
RIGHTS
ATTACHING TO SERIES A PREFERENCE
SHARES
|
(a) It was
noted that article 5 of the Articles empowers the Directors to issue Preference
Shares with such rights and subject to such restrictions and limitations as the
Directors shall determine in the resolution of the Directors approving the issue
of such shares. It was further noted that article 6 of the Articles
provides that Preference Shares may be issued in one or more separate series,
each of which will constitute a separate class of shares.
(b) IT WAS RESOLVED that the
Preference Shares with a nominal value of 50 xxxxx each to be issued and
allotted pursuant to paragraph ___ below shall be known as “Series A Preference Shares,”
shall not be redeemable, and shall be issued with the other rights, and subject
to the restrictions and limitations, set out in this paragraph
1.2(b):
(i) Board
Size
|
|
(A)
|
Prior
to August 22, 2008, the written consent of the holders (the “Series A Holders”) of at
least two-thirds (2/3s) of the issued and outstanding Series A Preference
Shares (a “Majority of
the Series A Holders”) shall be required prior to any appointment
by the Company’s Board of Directors (the “Board”) or election by
the Company’s shareholders of a Director of the Company which would
increase the total number of Directors of the Company then in office to
more than 8.
|
|
|
(B)
|
From
and after August 22, 2008, the written consent of a Majority of the Series
A Holders shall be required prior to any appointment by the Board or
election by the Company’s shareholders of a Director of the Company which
would increase the total number of Directors of the Company then in office
to more than 9 (inclusive of the Director appointed pursuant to paragraph
1.2(b)(ii)(D) below).
|
(ii) Appointment
of Directors; Voting
|
|
(A)
|
Subject
to paragraph 1.2(b)(ii)(D) below, the Series A Holders shall be entitled
(x) to elect four (4) members (each such member and any additional
director elected by the Series A Holders under paragraph 1.2(b)(ii)(D)
below to be known as a “Series A Director”) to
the Board, (y) to remove from office any Series A Director, with or
without cause, and (z) to fill any vacancy caused by the resignation,
death, or removal of a Series A
Director.
|
|
|
(B)
|
Subject
to paragraph 1.2(b)(ii)(E) below, the election of each Series A Director
by the Series A Directors (including to fill any vacancy caused by the
resignation, death, or removal of a Series A Director) shall be by a vote,
in person or by written consent, of a Majority of the Series A
Holders.
|
|
|
(C)
|
Subject
to paragraph 1.2(b)(ii)(E) below, in each election of a Series A Director
(other than where such election takes place at a general meeting of the
Company) and all other matters referred to in this paragraph 1.2(b) upon
which the holders of Series A Preference Shares shall be entitled to vote,
each Series A Preference Share shall entitle the Series A Holder thereof
to the number of votes equal to the product of (i) 1,000 and (ii) the
quotient obtained by dividing the number of the Company’s Ordinary Shares
at the time owned by such Series A Holder, directly or through American
Depositary Shares, by the number of the Company’s Ordinary Shares at the
time so owned by all the Series A
Holders.
|
|
|
(D)
|
If
(x) on or before August 22, 2008, an individual who is mutually acceptable
(each such mutually acceptable individual, the “Mutually Selected
Director”) to the Directors of the Company who are not Series A
Directors, on the one hand, and a majority of the Series A Directors (a
“Majority of the Series A
Directors”), on the other hand, shall not
have
|
-2-
been
appointed to the Board as the ninth (9th) Director of the Company, or (y) an
appointed Mutually Selected Director at any time has ceased to serve as a
Director and a new Mutually Selected Director shall not have been appointed by
the Directors within sixty (60) days thereafter, then, in each such instance,
the Series A Holders shall be entitled to elect a fifth (5th) member to the
Board (which shall then consist of a total of nine (9) Directors) who shall
continue in office until replaced by a new Mutually Selected Director, which the
Directors shall in good faith endeavor to appoint, or failing such new
appointment, by another Person elected by a Majority of the Series A
Holders.
|
|
(E)
|
In
the case of any resolution proposed on a poll at a general meeting of the
Company to appoint any person as a Director of the Company who has
previously been appointed as a Series A Director (whether by written
notice, by the Board or otherwise) or any person nominated by a Majority
of the Series A Holders pursuant to Article 113, the holders of the Series
A Preference Shares shall be entitled to vote, and each Series A
Preference Share held by a Series A Holder shall entitle such Series A
Holder to cast in respect of such resolution such number of votes as is
equal to the product obtained by multiplying (i)
the product of the total number of the Company’s Ordinary Shares then
outstanding times five (5) by (ii) the
quotient obtained by dividing the number of the Ordinary Shares at the
time owned by such Series A Holder, directly or through American
Depositary Shares, by the number of the Company’s Ordinary Shares at the
time so owned by all the Series A Holders (for each Series A Holder, its
“Number of Supermajority
Votes”). In the case of any resolution proposed on a poll at a
general meeting of the Company to remove any Series A Director or to elect
any person(s) whose election would cause the total number of Series A
Directors following such general meeting to be less than four (4), the
holders of the Series A Preference Shares shall be entitled to vote, and
each Series A Preference Share held by a Series A Holder shall entitle
such Series A Holder to cast in respect of such resolution such number of
votes as is equal to its Number of Supermajority
Votes.
|
(iii) Committees
From and
after the date hereof, a Majority of the Series A Directors shall have the right
to approve the composition of any committee of the Board, provided that any such
committee shall have an equal number of Series A Directors and Directors other
than Series A Directors.
(iv) Quorum
of the Board
Any
resolution of the Board to set the quorum necessary for the transaction of the
business of the Board (the “Quorum”) at any number other
than six (6), comprising three (3) Series A Directors and any three (3)
Directors other than Series A Directors shall require the
written consent of a Majority of the Series A Directors.
(v) Preemptive
Rights
-3-
|
|
(A)
|
Each
Series A Holder shall have a right of first refusal to purchase up to such
Series A Holder’s pro rata share (as described below) of any offering by
the Company of Ordinary Shares or any other class or series of its capital
stock, or any other securities convertible into or exchangeable for
Ordinary Shares or any other class or series of capital stock (including
convertible stock, redeemable stock and debt with warrants, but excluding
any Exempt Securities (as defined below), any issuances pursuant to the
Company’s equity credit agreement with Brittany Capital Management Ltd.
dated as of 1 June 2007, provided such issuance shall have been approved
by the affirmative vote of at least a majority of all the members of the
Board plus one additional Director (the “Supermajority
Directors”), and any issuances pursuant to that certain Securities
Purchase Agreement, dated May 13, 2008, by and among the Company and the
purchasers named therein related to an additional financing), in each
case, on the same terms as the other investors participating in such
offering. Each Series A Holder’s pro rata share shall be equal
to the percentage of the Company’s outstanding Ordinary Shares that are
owned by such Series A Holder at the time of each such
offering.
|
|
|
(B)
|
The
Company shall provide written notice to each Series A Holder that the
Company is considering any proposed future financing subject to such
preemptive rights, providing a general outline of the proposed structure
and anticipated terms thereof, not less than 15 days prior to completion
thereof (the “Completion
Date”). The Company shall also provide written notice to
each such Series A Holder describing in reasonable detail the terms of any
such proposed future financing (the “Detailed Notice”) within
a reasonable period of time (but not less than ten (10) days prior to the
Completion Date). Unless a Series A Holder provides the Company
notice in writing within five (5) days of its receipt of the Detailed
Notice that it wishes to participate in such financing, such Series A
Holder’s right with respect to such proposed future financing shall be
deemed waived. Anything herein to the contrary notwithstanding,
if required to accumulate from its investors the funds necessary to
participate in any such financing, each Series A Holder who has delivered
timely notice of its intent to participate in such financing shall have up
to fifteen (15) Business Days from the date it sent such notice of its
intent to participate to fund its purchase even if any such period extends
beyond the Completion Date.
|
|
|
(C)
|
The
rights and obligations established pursuant to this paragraph 1.2(b)(v)
shall terminate if (x) a Special Rights Termination Event (as defined
below) shall have occurred, or (y) the Series A Holders (and/or their
Affiliates (as defined below)) cease to own in the aggregate at least 33%
of the number of Shares (as defined in the Purchase Agreement) purchased
by them in the First Closing (as defined in the Purchase Agreement) and
the Second Closing (as defined in the Purchase
Agreement).
|
-4-
|
|
(D)
|
For
purposes herein:
|
|
|
(x)
|
“Exempt Securities” means (i) options
granted, and shares issued upon exercise thereof, to employees, Directors
or consultants under the Company’s stock option plans in amounts approved
by the Company’s Board of Directors upon the recommendation of its
remuneration committee (as appropriately adjusted for stock splits, stock
dividends, and the like), (ii) securities offered under a registration
statement on Form F-4 (or any applicable successor form), (iii) the
conversion or exercise of convertible debt or exercisable securities
outstanding on the date hereof as set forth on Schedule 2.27 of the
Disclosure Schedule to the Purchase Agreement, (iv) the issuance of
Ordinary Shares to pay milestones which may become payable in relation to
the acquisitions by the Company of Laxdale Limited and Ester Neurosciences
Ltd. as set forth on Schedule 2.26 of the Disclosure Schedule to the
Purchase Agreement, (v) the issuance of shares in connection with bank
financing or similar transactions that are primarily of a non-equity
financing nature and approved by the Board, and (vi) securities issued
pursuant to acquisitions or strategic transactions approved by the
Supermajority Directors.
|
|
|
(y)
|
“Special Rights Termination
Event” shall mean either (1) the failure of the Series A Holders to
timely exercise their option to fund the Second Closing Amount (as defined
in the Purchase Agreement) pursuant to Section 1.1(c) of the Purchase
Agreement, or (2) the timely exercise of such option by the Series A
Holders followed by the failure of the Second Closing to occur due to the
failure of the Series A Holders to satisfy any of the conditions provided
in Sections 5.3(a)-(c) of the Purchase
Agreement.
|
(vi) Conversion
and Termination
|
|
(A)
|
If
(x) the Second Closing occurs, and (y) at the Second Closing, any Series A
Holder funds less than such Series A Holder’s full Pro Rata Percentage (as
set forth opposite such Series A Holder’s name on Exhibit A to the
Purchase Agreement) of the Second Closing Amount, then each Series A
Preference Share held by such Series A Holder shall automatically convert
into one (1) Ordinary Share.
|
|
|
(B)
|
Each
Series A Preference Share held by all the Series A Holders shall
automatically convert into one Ordinary Share, and the rights and
obligations of the Series A Preference Shares shall terminate, if, at
any time after the Second Closing, (x) a Special Rights Termination Event
shall have occurred, or (y) the Series A Holders (and/or their
Affiliates)
|
-5-
|
|
cease
to own in the aggregate at least 33% of the number of Shares purchased by
them in the First Closing and the Second
Closing.
|
|
|
(C)
|
For
purposes herein, “Affiliates” shall mean
with respect to any Person, any other Person controlling, controlled by or
under direct or indirect common control with such Person (for the purposes
of this definition “control,” when used with
respect to any specified Person, shall mean the power to direct the
management and policies of such Person, directly or indirectly, whether
through ownership of voting securities, by contract or otherwise; and the
terms “controlling” and “controlled” shall have
meanings correlative to the
foregoing).
|
(vii) Required
Votes
The
written consent of a Majority of the Series A Purchasers shall be required for
the Company to effect or validate the following actions:
|
|
(A)
|
Any
amendment, alteration or repeal of any provision contained in this
paragraph 1.2(b);
|
|
|
(B)
|
Any
amendment, alteration or repeal of any provision contained in Articles 5
to 30 inclusive of the Company’s Articles of Association, in force as at
May 13, 2008, if such amendment, alteration or repeal of any such
provision would be adverse or inconsistent with the specific rights
attaching to the Series A Preference Shares as expressly set forth in this
paragraph 1.2(b) (the “Specific Series A
Rights”);
|
|
|
(C)
|
Any
issuance of any additional Series A Preference Shares;
or
|
|
|
(D)
|
Any
authorization, creation or designation, whether by reclassification or
otherwise, of any new class or series of capital stock or any other
securities convertible into equity securities of the Company which would
amend alter or repeal any of the Specific Series A Rights, or grant any
rights which are identical or superior to any of the Specific Series A
Rights.
|
(viii) Voting
Rights at General Meeting
Except as
provided in this paragraph 1.2(b), the Series A Preference Shares shall not
entitle the Series A Holders to vote at general meetings of the
Company.
(ix) Other
Rights
Save as
expressly provided in this paragraph 1.2(b), each Series A Preference Share
shall rank pari passu
in all respects with the Ordinary Shares.
-6-
