Exhibit 4.1
CELLEGY PHARMACEUTICALS, INC.
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is made and
entered into as of October 2, 2000 by and among Cellegy Pharmaceuticals, Inc., a
California corporation (the "Company"), and the parties listed on the Schedule
of Investors separately delivered to the Investors (the "Schedule of Investors")
(each hereinafter individually referred to as an "Investor" and collectively
referred to as the "Investors").
1. AGREEMENT TO PURCHASE AND SELL STOCK.
1.1 Authorization. As of the Closing (as defined below) the
Company will have authorized the issuance, pursuant to the terms and conditions
of this Agreement, of up to 1.5 million shares of the Company's Common Stock, no
par value (the "Common Stock").
1.2 Agreement to Purchase and Sell. The Company agrees to sell
to each Investor at the Closing, and each Investor agrees, severally and not
jointly, to purchase from the Company at the Closing, the number of shares of
Common Stock for the aggregate price set forth beside such Investor's name on
the Schedule of Investors, at the price per share for such Investor set forth on
the Schedule of Investors. The shares of Common Stock purchased and sold
pursuant to this Agreement will be collectively hereinafter referred to as the
"Purchased Shares."
2. CLOSING.
2.1 The Closing. The purchase and sale of the Purchased Shares
will take place at the offices of Fenwick & West LLP, Two Palo Alto Square,
Suite 800, Palo Alto, California, at 2:30 p.m. Pacific Time, on October 2, 2000
or at such other time and place as the Company and Investors who have agreed to
purchase a majority of the Purchased Shares listed on the Schedule of Investors
mutually agree upon (which time and place are referred to in this Agreement as
the "Closing"), provided that the closing may not be delayed for more than five
business days without the consent of all Investors. At the Closing, the Company
will deliver to each Investor a certificate representing the number of Purchased
Shares that such Investor has agreed to purchase hereunder as shown on the
Schedule of Investors against delivery to the Company by such Investor of the
full purchase price of such Purchased Shares, paid by (i) a check payable to the
Company's order, (ii) wire transfer of funds to the Company or (iii) any
combination of the foregoing.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Investor that, except as set forth in the Disclosure
Schedule and Schedule of Exceptions (the "Disclosure Schedule") separately
delivered by the Company to the Investors (which Disclosure Schedule shall be
deemed to be representations and warranties to the Investors by the Company
under this Section and to qualify each of the representations and warranties set
forth herein), the statements in the following paragraphs of this Section 3 are
all true and correct:
3.1 Organization, Good Standing and Qualification. The Company
is a corporation duly organized, validly existing and in good standing under the
laws of the State of California, and has all requisite corporate power and
authority to conduct its business as currently conducted. The Company is
qualified to do business as a foreign corporation in each jurisdiction where
failure to be so qualified could reasonably be expected to have a material
adverse effect on the business, assets, financial condition or results of
operations or assets of the Company (the "Business") (such effect referred to as
a "Material Adverse Effect").
3.2 Capitalization. Immediately before the Closing the
capitalization of the Company will consist of the following:
(a) Preferred Stock. A total of 5,000,000 authorized
shares of Preferred Stock, no par value per share (the "Preferred Stock"), none
of which are issued and outstanding.
(b) Common Stock. A total of 20,000,000 authorized
shares of Common Stock, of which approximately 12,262,614 shares were issued and
outstanding as of September 27, 2000.
(c) Options, Warrants, Reserved Shares. Except for:
(i) the approximately 2,523,711 shares of Common Stock issuable upon exercise of
options outstanding as of September 27, 2000, (ii) approximately 75,500
additional shares of Common Stock reserved for issuance under the Company's 1995
Directors Stock Option Plan, (iii) approximately 1,100,789 additional shares of
Common Stock reserved for issuance under the Company's 1995 Equity Incentive
Plan and (iv) warrants to purchase an aggregate of approximately 1,034,200
shares of Common Stock, there are not outstanding any options, warrants, rights
or agreements for the purchase or acquisition from the Company of any shares of
its capital stock or any securities convertible into or ultimately exchangeable
or exercisable for any shares of the Company's capital stock.
3.3 Subsidiaries. Except for Cellisis Pharmaceuticals, Inc.,
Cellegy Australia Pty Ltd, and Cellegy International, Inc., each of which is not
a "significant subsidiary" as defined in Rule 1-02 of Regulation S-X, the
Company does not presently own or control, directly or indirectly, any interest
in any other corporation, partnership, trust, joint venture, association, or
other entity.
3.4 Due Authorization; No Violation. All corporate action on
the part of the Company and its officers, directors and shareholders necessary
for the authorization, execution and delivery of, and the performance of all
obligations of the Company under, this Agreement, and the authorization,
issuance, reservation for issuance and delivery of all of the Purchased Shares
being sold under this Agreement, has been taken or will be taken prior to the
Closing, and this Agreement constitutes a valid and legally binding obligation
of the Company, enforceable against the Company in accordance with its terms,
except as enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization or other laws of general application relating to or
affecting the enforcement of creditors' rights generally and (ii) the effect of
rules of law governing the availability of equitable remedies. Neither the
execution, delivery or performance by the Company of this Agreement nor the
consummation by the Company of the transactions contemplated hereby will (i)
conflict with or result in a breach of any provision of the Restated
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Articles of Incorporation of the Company (the "Restated Articles") or the
Company's Bylaws, (ii) conflict with, result in a violation or breach of, or
cause a default (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any agreement,
instrument or obligation to which the Company is a party, which default could
reasonably be expected to have a Material Adverse Effect or (iii) violate any
law, statute, rule or regulation or judgment, order, writ, injunction or decree
of any governmental authority, in each case applicable to the Company or its
properties or assets and which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
3.5 Valid Issuance of Stock. The Purchased Shares, when
issued, sold and delivered in accordance with the terms of this Agreement for
the consideration provided for herein, will be duly and validly issued, fully
paid and nonassessable and are not subject to preemptive or other similar rights
of any shareholder of the Company.
3.6 Governmental Consents. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority on the part of
the Company is required in connection with the valid execution and delivery of
this Agreement, the offer, sale and issuance of the Purchased Shares, or the
consummation of the transactions contemplated by this Agreement, except for
qualifications or filings under the Securities Act of 1933, as amended (the
"Act") and the applicable rules and regulations (the "Rules and Regulations") of
the Securities and Exchange Commission (the "Commission") under the Act, and all
other applicable securities laws as may be required in connection with the
transactions contemplated by this Agreement. All such qualifications will be
effective on the Closing, and all such filings be made within the time
prescribed by law.
3.7 Absence of Changes. After the respective dates as of which
information is given in the Company's Proxy Statement for the annual meeting of
shareholders held on May 31, 2000, the Company's Annual Report on Form 10-K for
the year ended December 31, 1999, and the Company's Quarterly Report on Form
10-Q for the quarter ended June 30, 2000, respectively (such documents, together
with the Disclosure Schedule, referred to collectively as the "Disclosure
Documents"), there has not been (i) any material adverse change in the Business,
(ii) any transaction that is material to the Company, (iii) any obligation,
direct or contingent, that is material to the Company, incurred by the Company,
(iv) any change in the outstanding indebtedness of the Company that is material
to the Company, (v) any dividend declared, paid or made on the capital stock of
the Company or (vi) any loss or damage (whether or not insured) to the property
of the Company which has been sustained which could reasonably be expected to
have a Material Adverse Effect.
3.8 Litigation. There is no action, suit, proceeding, claim,
arbitration or investigation ("Action") pending (or, to the Company's knowledge,
currently threatened) against the Company, its activities, properties or assets,
which (i) might prevent the consummation of the transactions contemplated hereby
or (ii) if adversely resolved against the Company could reasonably be expected
to have a Material Adverse Effect.
3.9 Nasdaq Listing. The Common Stock is registered pursuant to
Section 12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and is listed on the Nasdaq Stock Market (Nasdaq National Market). The
Company has not received any notification that the Commission or the National
Association of Securities Dealers, Inc. is
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contemplating the termination of such registration or listing. Before the Shelf
Registration Statement (as defined in Section 7.2) is declared effective by the
Commission, the Purchased Shares will, if required by the listing rules of the
Nasdaq Stock Market, have been approved for quotation on the Nasdaq Stock
Market, subject to notice of issuance.
3.10 Exchange Act Filings. The Company has filed in a timely
manner all reports and other information required to be filed ("Filings") with
the Commission pursuant to the Exchange Act during the preceding twelve calendar
months. On their respective dates of filing, the Filings complied as to form in
all material respects with the requirements of the Exchange Act, and the
published rules and regulations of the Commission promulgated thereunder. On
their respective dates of filing, the Filings did not include any untrue
statement of a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they were made,
not misleading, and all financial statements contained in the Filings fairly
present the financial position of the Company on the dates of such statements
and the results of operations for the periods covered thereby in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved and prior periods, except as otherwise indicated in the notes
to such financial statements.
3.11 Disclosure. The representations and warranties made by
the Company in this Agreement (including the Disclosure Schedule) and the
Filings when read together do not contain any untrue statement of a material
fact and do not omit to state a material fact necessary to make the statements
herein as a whole not misleading.
3.12 Governmental Permits, Etc. The Company possesses all
licenses, franchises, governmental approvals, permits or other governmental
authorizations (collectively, "Authorizations") relating to the operation of the
Business, except for those Authorizations the failure of which to possess would
not, separately or in the aggregate, have a Material Adverse Effect. To the
Company's knowledge after reasonable investigation, the Company is in compliance
with the terms of all Authorizations and all laws, ordinances, regulations and
decrees which to the Company's knowledge are applicable to the Business, except
for such non-compliance which does not, separately or in the aggregate, have a
Material Adverse Effect.
3.13 Insurance. The Company is covered by insurance with
companies the Company believes to be responsible and in such amounts and
covering such risks as it believes to be adequate for the conduct of its
Business and the value of its properties and as is customary for companies
engaged in similar businesses in similar industries. The Company has no
knowledge that any such carrier has grounds or intends to cancel or fail to
renew such policies.
3.14 Intellectual Property. To the Company's knowledge after
reasonable investigation, the Company owns or possesses the patents, patent
rights, licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) and other rights or interests in items of intellectual
property as are necessary for the operation of the Business operated by it (the
"Patent and Proprietary Rights"), except where the failure to own or possess
such rights would not have a Material Adverse Effect; the Company has not
received notice of any asserted rights with respect to any of the Patent and
Proprietary Rights which, if determined unfavorably with respect to the
interests of the Company would have a Material Adverse Effect; and the Company
has not received notice or is otherwise aware of any infringement of or conflict
with
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asserted rights of others with respect to any of the Patent or Proprietary
Rights, which infringement or conflict (if the subject of any unfavorable
decision, ruling or finding), individually or in the aggregate, would result in
a Material Adverse Effect.
4. REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF INVESTORS.
Each Investor hereby represents and warrants to, and agrees with, the Company,
that:
4.1 Authorization. All corporate action on the part of the
Investor and its officers, directors and stockholders necessary for the
authorization, execution and delivery of, and the performance of all obligations
of the Investor under, this Agreement has been taken or will be taken prior to
the Closing, and this Agreement constitutes a valid and legally binding
obligation of the Investor, enforceable against the Investor in accordance with
its terms, except as enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization or other laws of general application relating to or
affecting the enforcement of creditors' rights generally and (ii) the effect of
rules of law governing the availability of equitable remedies.
4.2 Purchase for Own Account. The Purchased Shares to be
purchased by such Investor hereunder will be acquired for investment for such
Investor's own account, not as a nominee or agent, and not with a view to the
public resale or distribution thereof within the meaning of the Act, and such
Investor has no present intention of selling, granting any participation in, or
otherwise distributing the same. If not an individual, such Investor also
represents that such Investor has not been formed for the specific purpose of
acquiring Purchased Shares.
4.3 Disclosure of Information. The Investor has received a
copy of the Disclosure Documents and has received or has had full access to all
the information it considers necessary or appropriate to make an informed
investment decision with respect to the Purchased Shares to be purchased by the
Investor under this Agreement. Investor further has had an opportunity to ask
questions and receive answers from the Company regarding the terms and
conditions of the offering of the Purchased Shares and to obtain additional
information (to the extent the Company possessed such information or could
acquire it without unreasonable effort or expense) necessary to verify any
information furnished to the Investor or to which the Investor had access. The
foregoing, however, does not in any way limit or modify the representations and
warranties made by the Company in Section 3.
4.4 Investment Experience. Such Investor understands that the
purchase of the Purchased Shares involves substantial risk. Such Investor: (i)
has experience as an investor in securities of companies in the development
stage and acknowledges that such Investor is able to fend for itself, can bear
the economic risk of such Investor's investment in the Purchased Shares and has
such knowledge and experience in financial or business matters that such
Investor is capable of evaluating the merits and risks of this investment in the
Purchased Shares and protecting its own interests in connection with this
investment and/or (ii) has a preexisting personal or business relationship with
the Company and certain of its officers, directors or controlling persons of a
nature and duration that enables such Investor to be aware of the character,
business acumen and financial circumstances of such persons.
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4.5 Accredited Investor Status. Unless otherwise expressly
indicated on the Schedule of Investors to this Agreement, such Investor is an
"accredited investor" within the meaning of Regulation D promulgated under the
Act.
4.6 Restricted Securities. Such Investor understands that the
Purchased Shares are characterized as "restricted securities" under the Act
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under the Act and the Rules and Regulations
such securities may be resold without registration under the Act only in certain
limited circumstances. In this connection, such Investor represents that such
Investor is familiar with Rule 144 of the Commission and understands the resale
limitations imposed thereby and by the Act. Such Investor understands that the
Company is under no obligation to register any of the Purchased Shares except as
provided in Section 7 below.
4.7 Further Limitations on Disposition. Without in any way
limiting the representations set forth above, such Investor further agrees not
to make any disposition of all or any portion of the Purchased Shares unless and
until:
(a) there is then in effect a registration statement
under the Act covering such proposed disposition and such disposition is made in
accordance with such registration statement and the provisions of Section 7 of
this Agreement; or
(b) (i) such Investor shall have notified the Company
of the proposed disposition and shall have furnished the Company with a
statement of the circumstances surrounding the proposed disposition, and (ii)
such Investor shall have furnished the Company, at the expense of such Investor
or its transferee, with an opinion of counsel, reasonably satisfactory to the
Company, that such disposition will not require registration of such securities
under the Act.
Notwithstanding the provisions of paragraphs (a) and (b) above,
no such registration statement or opinion of counsel shall be required: (i) for
any routine transfer of any Purchased Shares in compliance with Rule 144 or Rule
144A (except that an opinion of counsel may be required for other than routine
Rule 144 transactions), or (ii) for any transfer of Purchased Shares by an
Investor that is a partnership or a corporation to (A) a partner of such
partnership or shareholder of such corporation, or (B) the estate of any such
partner or shareholder, or (iii) for the transfer by gift, will or intestate
succession by any Investor to his or her spouse or lineal descendants or
ancestors or any trust for any of the foregoing; provided, that in each of the
foregoing cases the transferee agrees in writing to be subject to the terms of
this Section 4 (other than Section 4.5) to the same extent as if the transferee
were an original Investor hereunder.
4.8 Legends. It is understood that the certificates evidencing
the Purchased Shares will bear the legends set forth below:
(a) THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER
THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER
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THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR
EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR
THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE
ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND
SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR
RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
(b) THE SHARES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO THE PROVISIONS OF, AND MAY HAVE CERTAIN REGISTRATION RIGHTS PURSUANT
TO, THE PROVISIONS OF A PURCHASE AGREEMENT BETWEEN THE COMPANY AND THE HOLDER,
WHICH MAY RESTRICT THE TRANSFER OF SUCH SHARES IN CERTAIN CIRCUMSTANCES. A COPY
OF SUCH AGREEMENT MAY BE OBTAINED, WITHOUT CHARGE, AT THE COMPANY'S PRINCIPAL
OFFICE.
(c) After consultation with counsel for the Investor,
any legend that counsel to the Company reasonably deems appropriate under the
laws of the State of California.
The legends set forth in (a) and (b) above shall, upon the request of
an Investor, be promptly removed by the Company from any certificate evidencing
Purchased Shares upon delivery to the Company of an opinion of counsel to the
Investor, reasonably satisfactory to the Company, that the legended security can
be freely transferred in a public sale without a registration statement being in
effect under the Act and in compliance with exemption requirements under
applicable state securities laws and that such transfer will not jeopardize the
exemption or exemptions from registration pursuant to which the Company issued
the Purchased Shares; provided, however, that no such opinion shall be required
in connection with routine sales of Purchased Shares pursuant to the Shelf
Registration Statement (as defined below). In connection with any such opinion,
the Investor shall provide such certifications as may be reasonably be deemed
necessary for the delivery of such opinion.
4.9 Resale Restrictions. To the extent requested by the
Company or an underwriter or placement agent of securities of the Company, each
Investor agrees that it will not directly or indirectly offer, sell, contract or
grant an option to sell, pledge, encumber, or otherwise dispose of or otherwise
transfer, or enter into any swap or other arrangement that transfers to another,
in whole or in part, any of the economic consequences of ownership of (whether
any such transaction described above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise) (a "Disposition"), any
Purchased Shares (other than to donees, shareholders or partners of the Investor
who agree to be similarly bound) from the date such a registration statement is
filed until up to 90 days after the effective date of a registration statement
of the Company relating to an underwritten offering of securities of the Company
filed under the Act; provided, however, that (i) this paragraph shall be
applicable only to the first such registration statement of the Company filed
after the date of this Agreement that covers securities to be sold on its behalf
to the public in a firm commitment underwritten offering and (ii) all executive
officers and directors of the Company then holding Common Stock who beneficially
own more than one percent of the outstanding shares of Common Stock enter into
similar
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agreements. This paragraph shall not preclude Investor from including
Registrable Securities in such registration statement.
5. CONDITIONS TO INVESTOR'S OBLIGATIONS AT CLOSING.
5.1 Closing. The obligations of each Investor under Section 2
of this Agreement to purchase the Purchased Shares at the Closing are subject to
the fulfillment or waiver, on or before the Closing, of each of the following
conditions, and the Company shall use all reasonable efforts to cause such
conditions to be satisfied on or before the Closing:
5.1.1 Representations and Warranties True. Each of
the representations and warranties of the Company contained in Section 3 shall
be true and correct on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of the Closing.
5.1.2 Performance. The Company shall have performed
and complied with all agreements, obligations and conditions contained in this
Agreement that are required to be performed or complied with by it on or before
the Closing and shall have obtained all approvals, consents and qualifications
necessary to complete the purchase and sale described herein.
5.1.3 Compliance Certificate. The Company shall have
delivered to the Investors at the Closing a certificate signed on its behalf by
its President, Chief Executive Officer, or Chief Financial Officer certifying
that the conditions specified in Sections 5.1.1 and 5.1.2 have been fulfilled.
5.1.4 Registration; Securities Exemptions. The offer
and sale of the Purchased Shares to the Investors pursuant to this Agreement
shall be exempt from the registration requirements under the Act and the
California Corporate Securities Law of 1968, as amended, and the rules
thereunder (the "Law") and the registration and/or qualification requirements of
all other applicable state securities laws.
5.1.5 No Material Change. There shall have been no
material adverse change in the Business from the date of this Agreement.
5.1.6 Opinion of Counsel. The Investors shall have
received an opinion of counsel to the Company substantially in the form of
Exhibit A attached hereto.
6. CONDITIONS TO THE COMPANY'S OBLIGATIONS AT CLOSING.
6.1. Closing. The obligations of the Company under this
Agreement to sell the Purchased Shares to the Investors at the Closing are
subject to the fulfillment or waiver on or before the Closing of each of the
following conditions by the Investor, and each Investor shall use all reasonable
efforts to cause such conditions to be satisfied on or before the Closing:
6.1.1 Representations and Warranties. The
representations and warranties of the Investor contained in Section 4 shall be
true and correct on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of the Closing.
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6.1.2 Payment of Purchase Price. The Investor shall
have delivered to the Company the purchase price for the Purchased Shares
specified for such Investor on the Schedule of Investors attached hereto, in
accordance with the provisions of Section 2.
6.1.3 Registration; Securities Exemptions. The offer
and sale of the Purchased Shares to the Investor pursuant to this Agreement
shall be exempt from the registration requirements under the Act and shall be
exempt from the qualification requirements of the Law and the registration
and/or qualification requirements of all other applicable state securities laws.
7. REGISTRATION RIGHTS.
7.1 Definitions. For purposes of this Agreement:
(a) Form S-3. The term "Form S-3" means such form
under the Act as is in effect on the date hereof or any successor registration
form under the Act subsequently adopted by the Commission that permits inclusion
or incorporation of substantial information by reference to other documents
filed by the Company with the Commission.
(b) Holder. The term "Holders" shall mean holders of
Registrable Securities that have registration rights pursuant to this Agreement.
(c) Registration. The terms "register," "registered,"
and "registration" refer to a registration effected by preparing and filing a
registration statement in compliance with the Act, and the declaration or
ordering of effectiveness of such registration statement.
(d) Registrable Securities. The term "Registrable
Securities" means: (1) all of the Purchased Shares, and (2) any shares of Common
Stock of the Company issued as a dividend or other distribution with respect to,
or in exchange for or in replacement of, any of the Purchased Shares; provided,
however, that the term "Registrable Securities" shall exclude in all events (and
such securities shall not constitute "Registrable Securities") (i) any
Registrable Securities sold or transferred by a person in a transaction in which
the registration rights granted under this Agreement are not assigned in
accordance with the provisions of this Agreement, (ii) any Registrable
Securities sold in a public offering pursuant to a registration statement filed
with the Commission or sold pursuant to Rule 144 promulgated under the Act
("Rule 144") or (iii) as to any Holder, the Registrable Securities held by such
Holder if all of such Registrable Securities can be publicly sold without volume
restriction within a three-month period pursuant to Rule 144.
(e) Prospectus: The term "Prospectus" shall mean the
prospectus included in any Shelf Registration Statement (including, without
limitation, a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A promulgated under the Act), as amended or supplemented by any
prospectus supplement (including, without limitation, any prospectus supplement
with respect to the terms of the offering of any portion of the Registrable
Securities covered by such Shelf Registration Statement), and all other
amendments and supplements to the
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Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
(f) Shelf Registration Statement. See Section 7.2(a).
7.2 Form S-3 Shelf Registration.
(a) Registration. The Company shall prepare and file
with the Commission within 60 days following the Closing and use all reasonable
efforts to have declared effective as soon as practicable thereafter, a
registration statement on Form S-3 (or, if the Company is not then eligible to
use Form S-3, then another appropriate form) providing for the resale by the
Holders of all of the Registrable Securities (the "Shelf Registration
Statement"). The Shelf Registration Statement may include securities other than
those held by Holders. If the Shelf Registration Statement is not declared
effective by January 31, 2001 and does not remain effective for 45 continuous
days after its effective date (except for the duration of any Blackout Notice as
described in Section 7.2(b) below), then the Investors holding Registrable
Securities shall be entitled to receive from the Company (pro rata in accordance
with their ownership of Registrable Securities) an aggregate number of shares of
Common Stock equal to 1% of the number of Purchased Shares for each month after
January 31, 2001, that the Shelf Registration Statement is not declared
effective (or does not remain effective), up to a maximum aggregate amount of 5%
of the Purchased Shares. The Company shall use its best efforts to keep the
Shelf Registration Statement continuously effective (subject to Section 7.2(b)),
pursuant to the Act and the Rules and Regulations promulgated thereunder, until
(i) the date when such Registrable Securities cease to meet the definition of
Registrable Securities pursuant to Section 7.1, or (ii) the Company's
obligations hereunder terminate. In the event that the Shelf Registration
Statement shall cease to be effective, the Company shall promptly prepare and
file a new registration statement covering the Registrable Securities and shall
use its best efforts to have such registration statement declared effective as
soon as possible. Any such registration statement shall be considered a "Shelf
Registration Statement" hereunder.
(b) Blackout Notice. In the event (i) that the
Company concludes that it is necessary for the Company to supplement the
Prospectus or make an appropriate filing under the Exchange Act so as to cause
the Prospectus to become current, or (ii) that, in the judgment of the
President, Chief Executive Officer or the Company's Board of Directors, it is
advisable to suspend use of the Prospectus for a discrete period of time due to
undisclosed pending corporate developments or pending public filings with the
Commission (which need not be described in detail), the Company shall deliver a
written notice (the "Blackout Notice") to the Holder to the effect of the
foregoing and, upon delivery of the Blackout Notice, the Holder shall not sell
any Purchased Shares or any other securities of the Company that are held by the
Holder, shall not otherwise engage in any other Disposition with respect to the
Company's securities, and shall not disclose to any third party that such a
notice has been given or the contents of the notice. The Permitted Window shall
resume upon the Holder's receipt of copies of the supplemented or amended
Prospectus, or at such time as the Holder is advised in writing by the Company
that the Prospectus may be used, and at such time as the Holder has received
copies of any additional or supplemental filings that are incorporated or deemed
incorporated by reference in such Prospectus and which are required to be
delivered as part of the Prospectus. In any event, such restrictions shall
terminate no later than 45 days after the date of delivery of the Blackout
Notice.
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If the Company has delivered a Blackout Notice within 90 days of the date that
it delivers another Blackout Notice pursuant this section, then the 45-day time
period set forth in the preceding sentence shall be shortened so that the
restrictions imposed by the Blackout Notice shall expire no later than 10 days
after delivery of such Blackout Notice.
(c) Expenses. The registration fees and expenses
incurred by the Company in connection with the Shelf Registration Statement and
actions taken by the Company in connection with each Permitted Window shall be
borne by the Company. Holder shall be responsible for any fees and expenses of
its counsel or other advisers.
7.3 Obligations of the Company. Whenever required to effect
the registration of any Registrable Securities under this Agreement, the Company
shall, as expeditiously as reasonably possible:
(a) Furnish to the Holder such number of copies of a
Prospectus, including a preliminary Prospectus, in conformity with the
requirements of the Act, and such other documents as it may reasonably request
in order to facilitate the disposition of the Registrable Securities owned by it
that are included in such registration.
(b) Use all reasonable efforts to register and
qualify the securities covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
requested by the Holder, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or
jurisdictions.
(c) Notify the Holder promptly (i) of any request by
the Commission or any other federal or state governmental authority during the
period of effectiveness of a registration statement for amendments or
supplements to such registration statement or related prospectus or for
additional information, (ii) of the issuance by the Commission or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a registration statement or the initiation of any proceedings
for that purpose and (iii) of the receipt by the Company of any notification
with respect to the suspension of the qualification or exemption from
qualification of any of the Registrable Securities for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose.
(d) Make every reasonable effort to obtain the
withdrawal of any order suspending the effectiveness of the Shelf Registration
Statement at the earliest possible time.
7.4 Furnish Information. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to Section 7.2 that
the Holder shall furnish to the Company such information regarding it, the
Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to timely effect the registration of its
Registrable Securities.
7.5 Indemnification. In the event any Registrable Securities
are included in a registration statement under this Agreement:
11
(a) By the Company. To the extent permitted by law,
the Company will indemnify and hold harmless the Holder, the officers and
directors of the Holder and each person, if any, who controls the Holder (such
persons and entities referred to as "Holder Indemnified Parties"), against any
losses, expenses, damages or liabilities to which they may become subject under
the Act, the Exchange Act or other federal or state law (a "Loss"), insofar as
such Losses (or actions in respect thereof) arise out of any claim, action or
proceeding brought by a third party arising out of or based upon any of the
following statements, omissions or violations (collectively a "Violation"):
(i) any untrue statement or alleged untrue statement
of a material fact contained in a registration statement filed
pursuant to this Section 7;
(ii) the omission or alleged omission to state in a
registration statement filed pursuant to this Section 7 a
material fact required to be stated therein, or necessary to
make the statements therein not misleading; or
(iii) any violation or alleged violation by the
Company of the Act, the Exchange Act, any federal or state
securities law or any rule or regulation promulgated under the
Act, the Exchange Act or any federal or state securities law,
in each case in connection with the offering covered by such
registration statement;
and the Company will reimburse each Holder Indemnified Party for any legal or
other expenses reasonably incurred by them, as incurred, in connection with
investigating or defending any such Violation; provided, however, that the
indemnity agreement contained in this subsection shall not apply to amounts paid
in settlement of any such Loss, if such settlement is effected without the
consent of the Company, nor shall the Company be liable in any such case for any
such Loss to the extent that it arises out of or is based upon a Violation which
occurs in reliance upon and in conformity with written information furnished
expressly for use in connection with such registration statement by the Holder
Indemnified Party; and provided further, that the Company will not be liable for
the reasonable legal fees and expenses of more than one counsel to the Holder
Indemnified Parties.
(b) By the Holder. To the extent permitted by law,
each Holder will indemnify and hold harmless the Company, each of its directors,
each of its officers who have signed the registration statement, and each
person, if any, who controls the Company within the meaning of the Act (such
persons and entities referred to as "Company Indemnified Parties") against any
Losses to which such Company Indemnified Parties may become subject under the
Act, the Exchange Act or other federal or state law, insofar as such Losses (or
actions in respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such Violation occurs in
reliance upon and in conformity with written information furnished by the Holder
expressly for use in connection with such registration statement; and the Holder
will reimburse any legal or other expenses reasonably incurred by such Company
Indemnified Parties in connection with investigating or defending any such
Violation; provided, however, that the indemnity agreement contained in this
subsection shall not apply to amounts paid in settlement of any such Loss if
such settlement is effected without the consent of the
12
Holder; provided further, that the Holder shall not be liable for the reasonable
legal fees and expenses of more than one counsel to the Company Indemnified
Parties; and provided further, that the total amounts payable in indemnity by
the Holder under this subsection in respect of any Violation shall not exceed
the net proceeds received by the Holder in the registered offering out of which
such Violation arises.
(c) Notice. Promptly after receipt by an indemnified
party under this Section of notice of the commencement of any action (including
any governmental action), such indemnified party will, if a claim for
indemnification in respect thereof is to be made against any indemnifying party
under this Section, deliver to the indemnifying party a written notice of the
commencement of such an action and the indemnifying party shall have the right
to participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume the defense
thereof with counsel selected by the indemnifying party and reasonably
acceptable to a majority in interest of the indemnified parties; provided,
however, that an indemnified party shall have the right to retain its own
counsel, with the reasonable fees and expenses to be paid by the indemnifying
party, if the indemnified party has been advised in writing by counsel that
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual conflict of interests
between such indemnified party and any other party represented by such counsel
in such proceeding. The failure to deliver written notice to the indemnifying
party within a reasonable time of the commencement of any such action shall
relieve such indemnifying party of liability to the indemnified party under this
Section to the extent such delay caused material prejudice to the indemnified
party, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section.
(d) Defect Eliminated in Final Prospectus. The
foregoing indemnity agreements of the Company and the Holder are subject to the
condition that, insofar as they relate to any Violation made in a preliminary
prospectus but eliminated or remedied in the amended prospectus on file with the
Commission at the time the registration statement in question becomes effective
or in the amended prospectus filed with the Commission pursuant to Rule 424(b)
of the Commission (the "Final Prospectus"), such indemnity agreements shall not
inure to the benefit of any person if a copy of the Final Prospectus was
furnished in a timely manner to the indemnified party and was not furnished to
the person asserting the loss, liability, claim or damage at or prior to the
time such action is required by the Act.
(d) Survival. The obligations of the Company and the
Holder under this Section shall survive the completion of any offering of
Registrable Securities in a registration statement, and otherwise.
7.6 Rule 144 Reporting. With a view to making available the
benefits of certain rules and regulations of the Commission, which may at any
time permit the sale of the Registrable Securities to the public without
registration, for so long as the Holder owns any Registrable Securities, the
Company agrees to:
(a) Make and keep adequate, current public
information available, as those terms are understood and defined in Rule 144
under the Act, at all times;
13
(b) File with the Commission in a timely manner all
reports and other documents required of the Company under the Exchange Act; and
(c) So long as the Holder owns any Registrable
Securities, to furnish to the Holder forthwith upon request a written statement
by the Company as to its compliance with the reporting requirements of said Rule
144, a copy of the most recent annual or quarterly report of the Company, and
such other reports and documents of the Company as the Holder may reasonably
request in availing itself of any rule or regulation of the Commission allowing
a Holder to sell any such securities without registration.
7.7 Termination of Cellegy's Obligations. The Company shall
have no obligation to register, or maintain, a registration statement governing
Registrable Securities, (i) if all Registrable Securities have been registered
and sold pursuant to registrations effected pursuant to this Agreement, or (ii)
with respect to any particular Holder, at such time as all Registrable
Securities held by such Holder may be sold without any volume restrictions
within a three month period under Rule 144, as it may be amended from time to
time, including but not limited to amendments that reduce that period of time
that securities must be held before such securities may be sold pursuant to such
rule.
7.8 Piggyback Registrations. (a) The Company shall use its
best efforts to notify all Holders of Registrable Securities in writing at least
twenty (20) days before filing any registration statement under the Act for
purposes of effecting an underwritten public offering by the Company of
securities of the Company (excluding registration statements relating to any
employee benefit plan or a corporate merger, acquisition or reorganization, or
any Form S-3 or similar shelf registration statements relating to the
non-underwritten offer and sale of securities for the account of persons or
entities other than the Company) and will afford each such Holder an opportunity
to include in such registration statement all or any part of the Registrable
Securities then held by such Holder. Each Holder desiring to include in any such
registration statement all or any part of the Registrable Securities held by
such Holder shall, within ten (10) days after receipt of the above-described
notice from the Company, so notify the Company in writing, and in such notice
shall inform the Company of the number of Registrable Securities such Holder
wishes to include in such registration statement. If a Holder decides not to
include all of its Registrable Securities in any such registration statement
filed by the Company, such Holder shall nevertheless continue to have the right
to include any Registrable Securities in any subsequent registration statement
or registration statements as may be filed by the Company with respect to
offerings of its securities, all upon the terms and conditions set forth herein.
The Holders' rights to include any Registrable Securities in any offering under
this Section are subject in all events to the ability of the managing
underwriter for such offering to exclude some or all of the Registrable
Securities requested to be registered on the basis of a good faith determination
that inclusion of such securities might adversely affect the success of the
offering or otherwise adversely affect the Company. Any such exclusion shall be
pro rata among all Holders who have requested to sell Registrable Securities in
such registration.
(b) Underwriting. If a registration statement under
which the Company gives notice under this Section is for an underwritten
offering, then the Company shall so advise the Holders of Registrable
Securities. In such event, the right of any such Holder's Registrable Securities
to be included in a registration pursuant to this Section shall be
14
conditioned upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the underwriting to the
extent provided herein. All Holders proposing to distribute their Registrable
Securities through such underwriting shall enter into an underwriting agreement
in customary form with the managing underwriter or underwriters selected for
such underwriting and shall furnish such information and documents as the
Company or the managing underwriter or underwriters may reasonably request.
Notwithstanding any other provision of this Agreement, if the managing
underwriter determine(s) in good faith that marketing factors require a
limitation of the number of shares to be underwritten, then the managing
underwriter(s) may exclude Registrable Securities from the registration and the
underwriting, pro rata among all Holders who have requested to sell Registrable
Securities in such registration. If any Holder disapproves of the terms of any
such underwriting, such Holder may elect to withdraw therefrom by written notice
to the Company and the underwriter, delivered at least ten (10) business days
prior to the effective date of the registration statement. Any Registrable
Securities excluded or withdrawn from such underwriting shall be excluded and
withdrawn from the registration.
(c) Expenses. The Holders shall be responsible for
there pro rata share of registration fees and underwriters' and brokers'
discounts and commissions relating to any Registrable Securities included in
such registration. Other registration expenses (such as legal and accounting
fees of counsel to the Company, printing fees, road show expenses, and the like)
shall be shall be borne by the Company.
(d) Number of Piggyback Registrations. The piggyback
registration rights granted to the Holders under this Section shall apply to the
first three registrations filed by the Company after the Closing.
8. ASSIGNMENT. Notwithstanding anything herein to the contrary, the
registration rights of the Holder under Section 7 hereof may be assigned only to
a party who acquires from the Holder at least 100,000 shares of Registrable
Securities (as such number may be adjusted to reflect subdivisions, combinations
and stock dividends of the Company's Common Stock), (such party is referred to
as a "Assignee"); provided, however, that (w) no party may be assigned any of
the foregoing rights until the Company is given written notice by the assigning
party at the time of such assignment stating the name and address of the
Assignee and identifying the securities of the Company as to which the rights in
question are being assigned; (x) that any such Assignee shall receive such
assigned rights subject to all the terms and conditions of this Agreement; and
(y) no such assignment or assignments shall increase the obligations of the
Company hereunder.
9. MISCELLANEOUS.
9.1 Survival of Warranties. The representations, warranties
and covenants of the Company and the Investors contained in or made pursuant to
this Agreement shall survive the execution and delivery of this Agreement and
the Closing and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of the Investors, their counsel or the
Company, as the case may be.
9.2 Successors and Assigns. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties.
15
9.3 Governing Law; Consent to Jurisdiction. This Agreement
shall be governed by and construed under the internal laws of the State of
California as applied to agreements among California residents entered into and
to be performed entirely within California, without reference to principles of
conflict of laws or choice of laws.
9.4 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.5 Headings. The headings and captions used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement. All references in this Agreement to sections,
paragraphs, exhibits, and schedules shall, unless otherwise provided, refer to
sections and paragraphs hereof and exhibits and schedules attached hereto, all
of which exhibits and schedules are incorporated herein by this reference.
9.6 Notices. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified, by
telecopier or upon deposit with the United States Post Office, by registered or
certified mail, postage prepaid and addressed to the party to be notified in the
case of the Company, at 000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx Xxx Xxxxxxxxx, XX
00000, attention: President, with a copy to C. Xxxxx Xxxxx, Xxxxxxx & West LLP,
Two Palo Xxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000, or in the case of Investor,
at the record address for such Investor as reflected on the books of the
Company, or at such other address as any party may designate by giving ten (10)
days advance written notice to the other party. Notices shall be deemed
delivered upon delivery if personally delivered, one business day after
transmission with confirmation of receipt if sent by telecopier, or three days
after deposit in the mails if mailed.
9.7 No Finder's Fees. Each party represents that it neither is
nor will be obligated for any finder's or broker's fee or commission in
connection with this transaction. Each Investor agrees to indemnify and to hold
harmless the Company from any liability for any commission or compensation in
the nature of a finder's or broker's fee (and any asserted liability) for which
the Investor or any of its officers, partners, employees, or representatives is
responsible. The Company agrees to indemnify and to hold harmless each Investor
from any liability for any commission or compensation in the nature of a
finder's or broker's fee (and any asserted liability) for which the Company or
any of its officers, employees or representatives is responsible.
9.8 Costs, Expenses. Each party's costs in connection with the
preparation, execution delivery and performance of this Agreement (including
without limitation legal fees) shall be borne by that party.
9.9 Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and Investors
holding a majority of the Purchased Shares purchased hereunder; provided,
however, that no amendment or waiver of the Company's obligations under Section
7 of this Agreement that significantly and adversely affects the rights of a
holder of Purchased Shares shall be binding upon that holder unless that holder
has consented in writing to such
16
amendment or waiver. Subject to the limitations set forth in the preceding
sentence, any amendment or waiver effected in accordance with this Section shall
be binding upon each holder of any Purchased Shares at the time outstanding
(even if such Investor or other holder did not vote with respect to, or voted
against, such amendment or waiver), each future holder of such securities, and
the Company. The Investors acknowledge that by virtue of this provision, holders
of a majority of the Purchased Shares may bind other holders to amendment or
waivers that such other holders may have voted to oppose.
9.10 Severability. If one or more provisions of this Agreement
are held to be invalid, illegal or unenforceable under applicable law, such
provision(s) shall be excluded from this Agreement and the balance of the
Agreement shall be interpreted as if such provision(s) were so excluded and
shall be enforceable in accordance with its terms.
9.11 Entire Agreement. This Agreement, together with any
exhibits or schedules hereto, constitutes the entire agreement and understanding
of the parties with respect to the subject matter hereof and supersedes any and
all prior negotiations, correspondence, agreements, understandings duties or
obligations between the parties with respect to the subject matter hereof.
9.12 Further Assurances. From and after the date of this
Agreement, upon the request of an Investor or the Company, the Company and the
Investors shall execute and deliver such instruments, documents or other
writings as may be reasonably necessary or desirable to confirm and carry out
and to effectuate fully the intent and purposes of this Agreement.
[Remainder of this page intentionally left blank]
17
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the date first above written.
THE COMPANY: INVESTOR:
----------- --------
Cellegy Pharmaceuticals, Inc., Framlington Health Fund
a California corporation ------------------------------
Name of Investor
By: /s/ Xxxxxxx Xxxxxx By: /s/ Xxxxxx Xxxxxxx
------------------------------------ -------------------------
Title: VP, Finance, CFO Title: Trust Accounts Supervisor
--------------------------------- ----------------------
[COUNTERPART SIGNATURE PAGE
COMMON STOCK PURCHASE AGREEMENT]
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IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the date first above written.
THE COMPANY: INVESTOR:
----------- --------
Cellegy Pharmaceuticals, Inc., Munder Framlington Healthcare Fund
a California corporation ------------------------------
Name of Investor
By: /s/ A. Xxxxxxx Xxxxxx By: /s/ Xxxxxx Xxxxxxx
------------------------------------ -------------------------
Title: VP, Finance, CFO Title: Trust Accounts Supervisor
--------------------------------- ----------------------
[COUNTERPART SIGNATURE PAGE
COMMON STOCK PURCHASE AGREEMENT]
19
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the date first above written.
THE COMPANY: INVESTOR:
----------- --------
Cellegy Pharmaceuticals, Inc., SMALL CAP World Fund, Inc.
a California corporation ------------------------------
Name of Investor
By: /s/ A. Xxxxxxx Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -------------------------
Title: VP, Finance, CFO Title: Secretary
--------------------------------- ----------------------
[COUNTERPART SIGNATURE PAGE
COMMON STOCK PURCHASE AGREEMENT]
20
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the date first above written.
THE COMPANY: INVESTOR:
----------- --------
Cellegy Pharmaceuticals, Inc., Four Partners
a California corporation ------------------------------
Name of Investor
By: /s/ A. Xxxxxxx Xxxxxx By: /s/ Xxxxxx X. Xxxxx
------------------------------------ -------------------------
Title: VP, Finance, CFO Title: Manager, Four Partners
--------------------------------- ----------------------
[COUNTERPART SIGNATURE PAGE
COMMON STOCK PURCHASE AGREEMENT]
21
