SECURITIES PURCHASE AGREEMENT
Exhibit 10.1
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
[INVESTOR]
This
Securities Purchase Agreement (this "Agreement")
is
dated as of February 7, 2007, among DOR BioPharma, Inc., a Delaware corporation
(the "Company"),
and
the investors identified on the signature pages hereto (each, an "Investor"
and
collectively, the "Investors").
WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant
to
Section 4(2) of the Securities Act (as defined below) and Rule 506 promulgated
thereunder, the Company desires to issue and sell to the Investors, and each
Investor, severally and not jointly, desires to purchase from the Company
certain securities of the Company, as more fully described in this
Agreement.
NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement,
and for other good and valuable consideration the receipt and adequacy of which
are hereby acknowledged, the Company and the Investors agree as
follows:
ARTICLE
I.
DEFINITIONS
1.1 Definitions.
In
addition to the terms defined elsewhere in this Agreement, for all purposes
of
this Agreement, the following terms shall have the meanings indicated in this
Section 1.1:
"Action"
means
any action, suit, inquiry, notice of violation, proceeding (including any
partial proceeding such as a deposition) or investigation pending or threatened
in writing against or affecting the Company, any Subsidiary or any of their
respective properties before or by any court, arbitrator, governmental or
administrative agency, regulatory authority (federal, state, county, local
or
foreign), stock market, stock exchange or trading facility.
"Affiliate"
means
any Person that, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with a Person, as such
terms are used in and construed under Rule 144.
"Business
Day"
means
any day except Saturday, Sunday and any day that is a federal legal holiday
or a
day on which banking institutions in the State of New York are authorized or
required by law or other governmental action to close.
"Closing"
means
the closing of the purchase and sale of the Securities pursuant to Article
II.
"Closing
Date"
means
the Business Day immediately following the date on which all the conditions
set
forth in Sections 5.1 and 5.2 hereof are satisfied, or such other date as the
parties may agree.
"Commission"
means
the Securities and Exchange Commission.
"Common
Stock"
means
the common stock of the Company, par value $.001 per share, and any securities
into which such common stock may hereafter be reclassified.
"Common
Stock Equivalents"
means
any securities of the Company or any Subsidiary which entitle the holder thereof
to acquire Common Stock at any time, including without limitation, any debt,
preferred stock, rights, options, warrants or other instrument that is at any
time convertible into or exchangeable for, or otherwise entitles the holder
thereof to receive, Common Stock or other securities that entitle the holder
to
receive, directly or indirectly, Common Stock.
"Company
Counsel"
means
Xxxxxxx Xxxxxx Xxxxxx & Dodge LLP.
"Delaware
Courts"
has the
meaning set forth in Section 6.8 hereof.
"Disclosure
Materials"
has the
meaning set forth in Section 3.1(h) hereof.
"Discussion
Time"
has the
meaning set forth in Section 3.2(g) hereof.
"Effective
Date"
means
the date that the Registration Statement required by Section 2(a) of the
Registration Rights Agreement is first declared effective by the
Commission.
"Exchange
Act"
means
the Securities Exchange Act of 1934, as amended.
"First
Notice"
has the
meaning set forth in Section 4.2 hereof.
"GAAP"
has the
meaning set forth in Section 3.1(h) hereof.
"Intellectual
Property Rights"
has the
meaning set forth in Section 3.1(o) hereof.
"Investment
Amount"
means,
with respect to each Investor, the investment amount indicated below the
Investor's name on the signature page of this Agreement.
"Investor
Party"
has the
meaning set forth in Section 4.6 hereof.
"Investors"
shall
mean the parties listed on the signature pages attached hereto.
"Lien"
means
any lien, charge, encumbrance, security interest, right of first refusal or
other restrictions of any kind.
"Losses"
shall
have the meaning set forth in Section 4.6 hereof.
"Material
Adverse Effect"
has the
meaning set forth in Section 3.1(b) hereof.
"Material
Permits"
has the
meaning set forth in Section 3.1(m) hereof.
"Per
Unit Purchase Price"
equals
$0.47 per common share.
"Person"
means an
individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any
kind.
"Proceeding"
means an
action, claim, suit, investigation or proceeding (including, without limitation,
an investigation or partial proceeding, such as a deposition), whether commenced
or threatened.
"Registration
Statement"
means a
registration statement meeting the requirements set forth in the Registration
Rights Agreement and covering the resale by the Investors of the
Shares.
"Registration
Rights Agreement"
means
the Registration Rights Agreement, dated as of the date of this Agreement,
among
the Company and the Investors, in the form of Exhibit
A
hereto.
"Rule
144"
means
Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as
such
Rule.
“Securities”
means
the Shares.
"Securities
Act"
means
the Securities Act of 1933, as amended.
"SEC
Reports"
has the
meaning set forth in Section 3.1(h) hereof.
"Shares"
means
the shares of Common Stock issued or issuable to the Investors pursuant to
this
Agreement.
"Short
Sales"
means,
without limitation, all "short sales" as defined in Rule 3b-3 of the Exchange
Act.
"Subsidiary"
means
any "significant subsidiary" as defined in Rule 1-02(w) of the Regulation S-X
promulgated by the Commission under the Exchange Act.
"Trading
Day"
means
(i) a day on which the Common Stock is traded in the over-the-counter market,
as
reported by the OTC Bulletin Board, or (ii) if the Common Stock is not quoted
on
the OTC Bulletin Board, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding to its functions
of reporting prices); provided, that in the event that the Common Stock is
not
listed or quoted as set forth in (i) and (ii) hereof, then Trading Day shall
mean a Business Day.
"Trading
Market"
means
the OTC Bulletin Board on which the Common Stock is listed or quoted for trading
on the date in question.
"Transaction
Documents"
means
this Agreement, the Registration Rights Agreement, and any other documents
or
agreements executed in connection with the transactions contemplated
hereunder.
ARTICLE
II.
PURCHASE
AND SALE
2.1 Closing.
Subject
to the terms and conditions set forth in this Agreement, at the Closing the
Company shall issue and sell to the Investors, and each Investor shall,
severally and not jointly, purchase from the Company, the Shares representing
each Investor’s Investment Amount. The Closing shall take place at the offices
of Xxxxxxx Xxxxxx Xxxxxx & Dodge LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 on the Closing Date or at such other location or time as the parties
may agree.
2.2 Closing
Deliveries.
(a) At
the Closing, the Company shall deliver or cause to be delivered to the Investors
the following (the “Company
Deliverables”):
(i) a
stock
certificate evidencing a number of Shares equal to each Investor’s Investment
Amount divided by the Per Unit Purchase Price, registered in the name of the
Investor; and
(ii) this
Agreement and the Registration Rights Agreement, duly executed by the
Company.
(iii) The
legal
opinion of Company Counsel, in agreed form, addressed to the
Investors.
(b) At
the
Closing, the Investors shall deliver or cause to be delivered to the Company
the
following:
(i) its
Investment Amount, in United States dollars and in immediately available funds,
by wire transfer to an account designated in writing by the Company for such
purpose; and
(ii) this
Agreement and the Registration Rights Agreement, duly executed by the
Investors.
ARTICLE
III.
REPRESENTATIONS
AND WARRANTIES
3.1 Representations
and Warranties of the Company.
The
Company hereby makes the following representations and warranties to the
Investors:
(a) Subsidiaries.
The
Company has no direct or indirect Subsidiaries other than as specified in the
SEC Reports. The Company owns, directly or indirectly, all of the capital stock
of each Subsidiary free and clear of any and all Liens, other than restrictions
on transfer under applicable securities laws, 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.
(b) Organization
and Qualification.
Each of
the Company and each Subsidiary is an entity duly incorporated or otherwise
organized, validly existing and in good standing 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. Neither the Company nor any
Subsidiary is in violation of any of the provisions of its respective
certificate or articles of incorporation, bylaws or other organizational or
charter documents. Each of the Company and each Subsidiary is duly qualified
to
conduct business and is in good standing as a foreign corporation or other
entity in each 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, would not,
individually or in the aggregate, have or reasonably be expected to result
in
(i) a material and adverse effect on the legality, validity or enforceability
of
any Transaction Document, (ii) a material and adverse effect on the results
of
operations, assets, prospects, business or condition (financial or otherwise)
of
the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
impairment to the Company's ability to perform on a timely basis its obligations
under any Transaction Document (any of (i), (ii) or (iii), a "Material
Adverse Effect").
(c) Authorization;
Enforcement.
The
Company has the requisite corporate power and authority to enter into and to
consummate the transactions contemplated by each of the Transaction Documents
and otherwise to carry out its obligations thereunder. The execution and
delivery of each of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated thereby have been duly
authorized by all necessary action on the part of the Company and no further
action is required by the Company in connection therewith other than the filings
referred to in Section 3.1(e) hereof and required pursuant to Section 4.5
hereof. Each Transaction Document 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
such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of, creditors’ rights and remedies or by
other equitable principles 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) insofar as indemnification and contribution provisions may
be
limited by applicable law.
(d) No
Conflicts.
The
execution, delivery and performance of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated thereby
do
not and will not (i) conflict with or violate any provision of the Company's
or
any Subsidiary's certificate or articles of incorporation, bylaws or other
organizational or charter documents, or (ii) conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become
a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both)
of,
any agreement, credit facility, debt or other instrument (evidencing a Company
or Subsidiary debt or otherwise) or other understanding to which the Company
or
any Subsidiary is a party or by which any property or asset of the Company
or
any Subsidiary is bound or affected, or (iii) result in a violation of any
law,
rule, regulation, order, judgment, injunction, decree or other restriction
of
any court or governmental authority to which the Company or a Subsidiary is
subject (including federal and state securities laws and regulations), or by
which any property or asset of the Company or a Subsidiary is bound or affected;
except in the case of each of clauses (ii) and (iii), such as would not,
individually or in the aggregate, have or reasonably be expected to result
in a
Material Adverse Effect.
(e) Filings,
Consents and Approvals.
The
Company is not required to obtain any consent, waiver, authorization or order
of, give any notice to, or make any filing or registration with, any court
or
other federal, state, local or other governmental authority or other Person
in
connection with the execution, delivery and performance by the Company of the
Transaction Documents, other than (i) the filing with the Commission of one
or
more Registration Statements in accordance with the requirements Registration
Rights Agreement, (ii) filings required by state securities laws, and the
timely filing of a Notice of Sale of Securities on Form D with the Commission,
(iii) the filings required in accordance with Section 4.5, and (iv) those that
have been made or obtained prior to the date of this Agreement.
(f) Issuance
of the Securities.
The
Securities have been duly authorized and, when issued and paid for in accordance
with the Transaction Documents, will be duly and validly issued, fully paid
and
nonassessable, free and clear of all Liens, other than restrictions on transfer
under applicable securities laws. The Company has reserved from its duly
authorized capital stock the shares of Common Stock issuable pursuant to this
Agreement.
(g) Capitalization.
The
number of shares and type of all authorized, issued and outstanding capital
stock of the Company, and all shares of Common Stock reserved for issuance
under
the Company’s various option and incentive plans, is set forth in the SEC
Reports. As of the date hereof, the authorized capital stock of the Company
consists of (i) 250,000,000 shares of Common Stock, of which as of the date
hereof, 73,916,781 shares are issued and outstanding, and (ii) 4,600,000 shares
of preferred stock, no shares of which are outstanding. Except as set forth
in
Schedule
3.1(g),
no
securities of the Company are entitled to preemptive or similar rights, and
no
Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by the
Transaction Documents, and there are no outstanding options, warrants, scrip
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities, rights or obligations convertible into or
exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of Common Stock, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound
to
issue additional shares of Common Stock, or securities or rights convertible
or
exchangeable into shares of Common Stock. Except as set forth in Schedule
3.1(g),
the
issue and sale of the Securities will not, immediately or with the passage
of
time, obligate the Company to issue shares of Common Stock or other securities
to any Person (other than the Investors) and will not result in a right of
any
holder of Company securities to adjust the exercise, conversion, exchange or
reset price under such securities.
(h) SEC
Reports; Financial Statements.
The
Company has filed all reports required to be filed by it under the Securities
Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
for the 12 months preceding the date hereof (or such shorter period as the
Company was required by law to file such reports) (the foregoing materials
being
collectively referred to herein as the "SEC
Reports"
and,
together with the Schedules to this Agreement (if any), the "Disclosure
Materials")
on a
timely basis or has timely filed a valid extension of such time of filing and
has filed any such SEC Reports prior to the expiration of any such extension.
As
of their respective dates, the SEC Reports complied in all material respects
with the requirements of the Securities Act and the Exchange Act and the rules
and regulations of the Commission promulgated thereunder, and none of the SEC
Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. The financial statements of the Company included
in the SEC Reports comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with respect
thereto as in effect at the time of filing. Such financial statements have
been
prepared in accordance with generally accepted accounting principles applied
on
a consistent basis during the periods involved ("GAAP"),
except
as may be otherwise specified in such financial statements or the notes thereto
and except that unaudited financial statements may not 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, year-end audit
adjustments disclosed therein.
(i) Material
Changes.
Since
the date of the latest audited financial statements included within the SEC
Reports, except as specifically disclosed in the SEC Reports, (i) there has
been
no event, occurrence or development that has had or that would reasonably be
expected to result in a Material Adverse Effect, (ii) the Company has not
incurred any liabilities (contingent or otherwise) other than (A) trade
payables, accrued expenses, and other liabilities incurred in the ordinary
course of business consistent with past practice and (B) liabilities not
required to be reflected in the Company's financial statements pursuant to
GAAP
or required to be disclosed in filings made with the Commission, (iii) the
Company has not altered its method of accounting or the identity of its
auditors, (iv) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made
any
agreements to purchase or redeem any shares of its capital stock, and (v) the
Company has not issued any equity securities to any officer or director, except
pursuant to existing Company stock option plans. The Company does not have
pending before the Commission any request for confidential treatment of
information.
(j) Litigation.
Except
as disclosed in the SEC Reports, there is no Action which (i) adversely affects
or challenges the legality, validity or enforceability of any of the Transaction
Documents or the Securities or (ii) except as specifically disclosed in the
SEC
Reports, would, if there were an unfavorable decision, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect. Neither the Company nor any Subsidiary, nor any director or officer
thereof (in his or her capacity as such), is or has been the subject of any
Action involving a claim of violation of or liability under federal or state
securities laws or a claim of breach of fiduciary duty, except as specifically
disclosed in the SEC Reports. There has not been, and to the knowledge of the
Company, there is not pending any investigation by the Commission involving
the
Company or any current or former director or officer of the Company (in his
or
her capacity as such). The Commission 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.
(k) Labor
Relations.
No
material labor dispute exists or, to the actual knowledge of the executive
officers or directors of the Company, is imminent with respect to any of the
employees of the Company.
(l) Compliance.
Neither
the Company nor any Subsidiary (i) is in default under or in violation of (and
no event has occurred that has not been waived that, with notice or lapse of
time or both, would result in a default by the Company or any Subsidiary under),
nor has the Company or any Subsidiary received notice of a claim that it is
in
default under or that it is in violation of, any indenture, loan or credit
agreement or any other agreement or instrument to which it is a party or by
which it or any of its properties is bound (whether or not such default or
violation has been waived), (ii) is in violation of any order of any court,
arbitrator or governmental body, or (iii) is or has been in violation of any
statute, rule or regulation of any governmental authority, including without
limitation all foreign, federal, state and local laws relating to taxes,
environmental protection, occupational health and safety, product quality and
safety and employment and labor matters, except in each case as would not,
individually or in the aggregate, have or reasonably be expected to result
in a
Material Adverse Effect. The Company is in compliance with the applicable
effective requirements of the Xxxxxxxx-Xxxxx Act of 2002, as amended, and the
rules and regulations thereunder, except where such noncompliance would not
have
or reasonably be expected to result in a Material Adverse Effect.
(m) Regulatory
Permits.
The
Company and the Subsidiaries possess all certificates, authorizations and
permits issued by the appropriate federal, state, local or foreign regulatory
authorities necessary to conduct their respective businesses as described in
the
SEC Reports, except where the failure to possess such permits would not,
individually or in the aggregate, have or reasonably be expected to result
in a
Material Adverse Effect ("Material
Permits"),
and
neither the Company nor any Subsidiary has received any notice of proceedings
relating to the revocation or modification of any Material Permit.
(n) Title
to Assets.
The
Company and the Subsidiaries have good and marketable title in fee simple to
all
real property owned by them that is material to their respective businesses
and
good and marketable title in all personal property owned by them that is
material to their respective businesses, in each case free and clear of all
Liens, except for Liens as do not materially affect the value of such property
and do not materially interfere with the use made and proposed to be made of
such property by the Company and the Subsidiaries. Any real property and
facilities held under lease by the Company and the Subsidiaries are held by
them
under valid, subsisting and enforceable leases of which the Company and the
Subsidiaries are in compliance, except as would not, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect.
(o) Patents
and Trademarks.
The
Company and the Subsidiaries have, or have rights to use, all patents, patent
applications, trademarks, trademark applications, service marks, trade names,
copyrights, licenses and other similar rights that are necessary or material
for
use in connection with their respective businesses as described in the SEC
Reports and which the failure to so have would, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse Effect
(collectively, the "Intellectual
Property Rights").
Neither the Company nor any Subsidiary has received a written notice that the
Intellectual Property Rights used by the Company or any Subsidiary violates
or
infringes upon the rights of any Person where such infringement would have
or
could reasonably be expected to have a Material Adverse Effect. Except as set
forth in the SEC Reports and file histories of pending patent applications,
to
the actual knowledge of the executive officers and directors of the Company,
all
such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property
Rights.
(p) Insurance.
The
Company and the Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in which the Company and the Subsidiaries are
engaged. The Company has no reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business on terms consistent with market for the Company’s line of
business.
(q) Transactions
With Affiliates and Employees.
Except
as set forth in the SEC Reports, none of the officers or directors of the
Company and, to the knowledge of the Company, none of the employees of the
Company is presently a party to any transaction with the Company or any
Subsidiary (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of the Company, any entity in
which any officer, director, or any such employee has a substantial interest
or
is an officer, director, trustee or partner.
(r) Internal
Accounting Controls.
The
Company and the Subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed
in
accordance with management's general or specific authorizations, (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and
to
maintain asset accountability, (iii) access to assets is permitted only in
accordance with management's general or specific authorization, and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. The Company has established disclosure controls and procedures
(as
defined in Exchange Act rules 13a-15(e) and 15d-15(e)) for the Company and
designed such disclosure controls and procedures to ensure that material
information relating to the Company, including its Subsidiaries, is made known
to the certifying officers by others within those entities, particularly during
the period in which the Company’s Form 10-KSB or 10-QSB, as the case may be, is
being prepared.
(s) Solvency.
Based
on the financial condition of the Company as of the Closing Date (and assuming
the Closing with $4 million in proceeds shall have occurred), the Company’s
assets constitute sufficient capital to enable the Company to carry on its
business for the current fiscal year as now conducted and as currently proposed
to be conducted through December 2007.
(t) Certain
Fees.
Except
as may be payable to MidSouth Capital, Inc. by the Company, 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 Investors shall have no obligation with respect to any
fees
payable to MidSouth Capital, Inc. or with respect to any claims (other than
such
fees or commissions owed by the Investors pursuant to written agreements
executed by the Investors which fees or commissions shall be the sole
responsibility of the Investors) 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.
(u) Certain
Registration Matters.
Assuming the accuracy of the Investors' representations and warranties set
forth
in Section 3.2(b)-(e), no registration under the Securities Act is required
for
the offer and sale of the Shares by the Company to the Investors under the
Transaction Documents. Except as set forth in Schedule
3.1(u),
the
Company has not granted or agreed to grant to any Person any rights (including
"piggy-back" registration rights) to have any securities of the Company
registered with the Commission or any other governmental authority that have
not
been satisfied.
(v) Listing
and Maintenance Requirements.
The
issuance and sale of the Securities under the Transaction Documents does not
contravene the rules and regulations of the Trading Market on which the Common
Stock is currently listed or quoted, and no approval of the shareholders of
the
Company thereunder is required for the Company to issue and deliver to the
Investors the maximum number of Securities contemplated by Transaction
Documents.
(w) Investment
Company.
The
Company is not, and is not an Affiliate of, an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.
(x) Application
of Takeover Protections.
The
Company has taken all necessary action, if any, in order to render inapplicable
any control share acquisition, business combination, poison pill (including
any
distribution under a rights agreement) or other similar anti-takeover provision
under the Company's Certificate of Incorporation (or similar charter documents)
or the laws of its state of incorporation that is or could become applicable
to
the Investors as a result of the Investors and the Company fulfilling their
obligations or exercising their rights under the Transaction Documents,
including without limitation the Company's issuance of the Securities and the
Investors' ownership of the Securities.
(y) No
Additional Agreements.
The
Company does not have any agreement or understanding with the Investors with
respect to the transactions contemplated by the Transaction Documents other
than
as specified in the Transaction Documents.
(z) Disclosure.
Upon
the filing of the initial Current Report on Form 8-K required under Section
4.5,
the Investors will not have received from the Company or any Person acting
on
its behalf any information that the Company believes constitutes material,
non-public information concerning the Company. The Company understands and
confirms that the Investors will rely on the foregoing representations and
covenants in effecting transactions in securities of the Company. All written
disclosures provided to the Investors regarding the Company, its business and
the transactions contemplated hereby, furnished by or on behalf of the Company
(including the Company’s representations and warranties set forth in this
Agreement) are true and correct and do not contain any untrue statement of
a
material fact or omit to state any material fact necessary in order to make
the
statements made therein, in light of the circumstances under which they were
made, not misleading.
3.2 Representations
and Warranties of the Investors.
Each
Investor hereby, for itself and for no other Investor, represents and warrants
to the Company as follows:
(a) Organization;
Authority.
Such
Investor is an entity duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization with the requisite
corporate or partnership power and authority to enter into and to consummate
the
transactions contemplated by the applicable Transaction Documents and otherwise
to carry out its obligations thereunder. The execution, delivery and performance
by such Investor of the transactions contemplated by this Agreement has been
duly authorized by all necessary corporate or, if such Investor is not a
corporation, such partnership, limited liability company or other applicable
like action, on the part of such Investor. Each of this Agreement and the
Registration Rights Agreement has been duly executed by such Investor, and
when
delivered by such Investor in accordance with terms hereof, will constitute
the
valid and legally binding obligation of such Investor, enforceable against
it in
accordance with its terms, except (i) as such enforceability may be limited
by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
or
similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies or by other equitable principles 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) insofar as indemnification and contribution
provisions may be limited by applicable law.
(b) Investment
Intent.
The
Investor is acquiring the Securities as principal for its own account for
investment purposes only and not with a view to or for distributing or reselling
such Securities or any part thereof, without prejudice, however, to such
Investor's right at all times to sell or otherwise dispose of all or any part
of
such Securities in compliance with applicable federal and state securities
laws.
Subject to the immediately preceding sentence, nothing contained herein shall
be
deemed a representation or warranty by such Investor to hold the Securities
for
any period of time. The Investor is acquiring the Securities hereunder in the
ordinary course of its business. The Investor does not have any agreement or
understanding, directly or indirectly, with any Person to distribute any of
the
Securities.
(c) Investor
Status.
At the
time such Investor was offered the Securities, it was, and at the date hereof
it
is an "accredited investor" as defined in Rule 501(a) under the Securities
Act.
The Investor is not required to be registered as a broker-dealer under Section
15 of the Exchange Act.
(d) General
Solicitation.
The
Investor is not purchasing the Securities as a result of any advertisement,
article, notice or other communication regarding the Securities published in
any
newspaper, magazine or similar media or broadcast over television or radio
or
presented at any seminar or any other general solicitation or general
advertisement.
(e) Access
to Information.
The
Investor acknowledges that it has reviewed the Disclosure Materials and 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 Shares and the merits and risks
of
investing in the Securities; (ii) access to information about the Company and
the Subsidiaries and their respective financial condition, results of
operations, business, properties, management and prospects sufficient to enable
it to evaluate its investment; and (iii) the opportunity to obtain such
additional information that the Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed investment
decision with respect to the investment. Neither such inquiries nor any other
investigation conducted by or on behalf of such Investor or its representatives
or counsel shall modify, amend or affect such Investor's right to rely on the
truth, accuracy and completeness of the Disclosure Materials and the Company's
representations and warranties contained in the Transaction
Documents.
(f) Independent
Investment Decision.
The
Investor has independently evaluated the merits of its decision to purchase
Securities pursuant to this Agreement, such decision has been independently
made
by such Investor and such Investor confirms that it has only relied on the
advice of its own business and/or legal counsel and not on the advice of any
other Investor’s business and/or legal counsel in making such
decision.
(g) Short
Sales.
The
Investor has not directly or indirectly, nor has any Person acting on behalf
of
or pursuant to any understanding with such Investor, executed any Short Sales
in
the securities of the Company since the date that such Investor was first
contacted regarding an investment in the Company ("Discussion
Time").
(h) Residency.
The
Investor is a resident of that jurisdiction specified as the address that such
Investor is to receive notices hereunder on the signature pages hereto.
The
Company acknowledges and agrees that the Investor does not make or has not
made
any representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in this Section 3.2.
ARTICLE
IV.
OTHER
AGREEMENTS OF THE PARTIES
4.1 (a)Securities
may only be disposed of in compliance with state and federal securities laws.
In
connection with any transfer of the Securities other than pursuant to an
effective registration statement, to the Company, to an Affiliate of such
Investor or in connection with a pledge as contemplated in Section 4.1(b),
the
Company may require the transferor thereof to provide to the Company an opinion
of counsel selected by the transferor, reasonably acceptable to the Company,
the
form and substance of which opinion shall be reasonably satisfactory to the
Company, to the effect that such transfer does not require registration of
such
transferred Securities under the Securities Act.
(b) Certificates
evidencing the Securities will contain the following legend, until such time
as
they are not required under Section 4.1(c):
THESE
SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT SECURED BY SUCH SECURITIES.
The
Company acknowledges and agrees that an Investor may from time to time pledge,
and/or grant a security interest in some or all of the Securities pursuant
to a
bona fide margin agreement with a registered broker-dealer or grant a security
interest in some or all of the Securities to a financial institution that is
an
"accredited investor" as defined in Rule 501(a) under the Securities Act and
who
agrees to be bound by the provisions of this Agreement and the Registration
Rights Agreement and, if required under the terms of such agreement or account,
such Investor may transfer pledged or secured Securities to the pledgees or
secured parties. Such a pledge or transfer would not be subject to approval
or
consent of the Company and no legal opinion of legal counsel to the pledgee,
secured party or pledgor shall be required in connection with the pledge, but
such legal opinion may be required in connection with a subsequent transfer
following default by the Investor transferee of the pledge. No notice shall
be
required of such pledge. At the appropriate Investor’s expense, the Company will
execute and deliver such reasonable documentation as a pledgee or secured party
of Securities may reasonably request in connection with a pledge or transfer
of
the Securities including the preparation and filing of any required prospectus
supplement under Rule 424(b)(3) of the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of Selling
Stockholders thereunder.
(c) Certificates
evidencing the Shares shall not contain any legend (including the legend set
forth in Section 4.1(b)): (i) following a sale of such Securities pursuant
to an
effective registration statement (including the Registration Statement), or
(ii)
following a sale of such Shares pursuant to Rule 144 (assuming the transferor
is
not an Affiliate of the Company), or (iii) while such Shares are eligible for
sale under Rule 144(k). Following such time as restrictive legends are not
required to be placed on certificates representing Shares pursuant to the
preceding sentence, the Company will, no later than three Trading Days following
the delivery by such Investor to the Company or the Company's transfer agent
of
a certificate representing Shares containing a restrictive legend, deliver
or
cause to be delivered to such Investor a certificate representing such Shares
that is free from all restrictive and other legends. The Company may not make
any notation on its records or give instructions to any transfer agent of the
Company that enlarge the restrictions on transfer set forth in this
Section.
4.2 Right
of First Negotiation.
If, at
any time before the one year anniversary of the Closing Date, the Company
proposes to sell any newly issued equity Common Stock or Common Stock
Equivalents in a financing transaction (collectively, “New
Issue Securities”),
the
Company shall not commence negotiations with any party regarding the offer
of
the New Issue Securities without first offering such Investor the right to
negotiate to purchase a portion of such New Issue Securities in accordance
with
the following provisions:
(a) The
Company shall give a notice to each Investor (the “First
Notice”)
stating
(i) its intention to sell the New Issue Securities, (ii) the number and
description of the New Issue Securities proposed to be sold and (iii) the
proposed purchase price (calculated as of the proposed issuance date) and the
other terms and conditions upon which the Company is proposing to offer the
New
Issue Securities.
(b) Upon
receipt of the First Notice, each Investor, if it elects to do so, may commence
negotiations with the Company to purchase up to his, her or its proportionate
number of fifty percent (50%) of the New Issue Securities (based upon his,
her
or its percentage ownership of the total number of issued and outstanding shares
of Common Stock) (the "New
Issue Percentage");
provided however that in no event may any Investor purchase an amount of New
Issue Securities so that the Investor, after such purchase, would own more
than
fifteen percent (15%) of the voting capital stock of the Company (the
"Investor
Cap").
In
order to commence such negotiations with the Company, such Investor shall
provide notice to the Company of such decision ("Notice
of Negotiation")
within
two (2) Business Days after the First Notice and, for a period of no more than
five (5) Business Days after receipt of the Notice of Negotiation, both parties
shall negotiate the terms of an agreement for such Investor to purchase the
New
Issue Percentage subject to the Investor Cap.
(c) If
such
Investor does not provide the Notice of Negotiation or the parties are unable
to
agree on the terms of such agreement within such five-Business Day period,
the
Company may immediately proceed to negotiate with other parties with respect
to
such an issuance of New Issue Securities; provided, however that if the Company
has not entered into a definitive agreement with a third party for the purchase
of the New Issue Securities within forty-five (45) days after the date of the
Notice of Negotiation, the provisions of this Section 4.2 shall be reinstated.
4.3 Integration.
The
Company shall not, and shall use its best efforts to ensure that no Affiliate
of
the Company shall, sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in Section 2 of the Securities
Act) that would be integrated with the offer or sale of the Securities in a
manner that would require the registration under the Securities Act of the
sale
of the Securities to such Investor, or that would be integrated with the offer
or sale of the Securities for purposes of the rules and regulations of any
Trading Market in a manner that would require stockholder approval of the sale
of the securities to such Investor.
4.4 Subsequent
Registrations.
Except
for the items described on Schedule
4.4
and the
Registration Statement, prior to the Effective Date, the Company may not file
any registration statement (other than on Form S-8) with the Commission with
respect to any securities of the Company.
4.5 Securities
Laws Disclosure; Publicity.
By 9:00
a.m. (New York time) on the next Business Day following the Closing Date, the
Company will file a Current Report on Form 8-K disclosing the material terms
of
the Transaction Documents (and attach as exhibits thereto the Transaction
Documents), and on the Closing Date the Company will file an additional Current
Report on Form 8-K to disclose the Closing. In addition, the Company will make
such other filings and notices in the manner and time required by the Commission
and the Trading Market on which the Common Stock is listed. Notwithstanding
the
foregoing, the Company shall not publicly disclose the name of any Investor,
or
include the name of any Investor in any filing with the Commission (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 or Trading Market, without the prior written
consent of such Investor, except to the extent such disclosure is required
by
law or Trading Market regulations, in which case the Company shall provide
such
Investor with prior notice of such disclosure.
4.6 Indemnification
of the Investors.
In
addition to the indemnity provided in the Registration Rights Agreement, the
Company will indemnify and hold each Investor and its directors, officers,
shareholders, partners, employees and agents (each, an "Investor
Party")
harmless from any and all losses, liabilities, obligations, claims,
contingencies, damages, costs and expenses, including all judgments, amounts
paid in settlements, court costs and reasonable attorneys' fees and costs of
investigation (collectively, "Losses")
that
any such Investor Party may suffer or incur as a result of or relating to any
misrepresentation, breach or inaccuracy of any representation, warranty,
covenant or agreement made by the Company in any Transaction Document. In
addition to the indemnity contained herein, the Company will reimburse the
Investor Party for its reasonable legal and other expenses (including the cost
of any investigation, preparation and travel in connection therewith) incurred
in connection therewith, as such expenses are incurred.
4.7 Non-Public
Information.
The
Company covenants and agrees that neither it nor any other Person acting on
its
behalf will provide any Investor or its agents or counsel with any information
that the Company believes constitutes material non-public information, unless
prior thereto such Investor shall have executed a written agreement regarding
the confidentiality and use of such information. The Company understands and
confirms that each Investor shall be relying on the foregoing representations
in
effecting transactions in securities of the Company.
4.8 Use
of
Proceeds.
The net
proceeds from the offer and sale of the Securities will be used to advance
the
pre-clinical, clinical and regulatory development of the Company’s drug and
vaccine candidates. A portion of the net proceeds shall also be used for general
corporate purposes, including the maintenance of in-licensed patent rights
and
proprietary intellectual property patent applications and patents. No portion
of
the net proceeds will be used to redeem outstanding securities of the Company.
4.9 No
Net
Short Position.
Each
Investor covenants that neither it nor any Affiliates acting on its behalf
or
pursuant to any understanding with it will execute any Short Sales during the
period from the Discussion Time until prior to the time that the transactions
contemplated by this Agreement are first publicly announced as described in
Section 4.5 hereof. Additionally, each Investor understands and acknowledges,
severally and not jointly with any other Investor, that the Commission currently
takes the position that coverage of short sales of the Common Stock "against
the
box" prior to the Effective Date of the Registration Statement issuable
hereunder is a violation of Section 5 of the Securities Act, as set forth in
Item 65, Section 5 under Section A, of the Manual of Publicly Available
Telephone Interpretations, dated July 1997, compiled by the Office of Chief
Counsel, Division of Corporation Finance.
ARTICLE
V.
CONDITIONS
PRECEDENT
5.1 Conditions
Precedent to the Obligations of the Investors to Purchase
Securities.
The
obligation of each Investor to acquire Securities at the Closing is subject
to
the satisfaction or waiver by such Investor, at or before the Closing, of each
of the following conditions:
(a) Representations
and Warranties.
The
representations and warranties of the Company contained herein shall be true
and
correct in all material respects as of the date when made and as of the Closing
as though made on and as of such date;
(b) Performance.
The
Company shall have performed, satisfied and complied in all material respects
with all covenants, agreements and conditions required by the Transaction
Documents to be performed, satisfied or complied with by it at or prior to
the
Closing;
(c) No
Injunction.
No
statute, rule, regulation, executive order, decree, ruling or injunction shall
have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction that prohibits the consummation of any
of
the transactions contemplated by the Transaction Documents;
(d) Adverse
Changes.
Since
the date of execution of this Agreement, no event or series of events shall
have
occurred that reasonably would be expected to have or result in a (i) an
adverse effect on the legality, validity or enforceability of any Transaction
Document, or (ii) a material and adverse effect on the results of operations,
assets, business or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole;
(e) No
Suspensions of Trading in Common Stock; Listing.
Trading
in the Common Stock shall not have been suspended by the Commission or any
Trading Market (except for any suspensions of trading of not more than one
Trading Day solely to permit dissemination of material information regarding
the
Company) at any time since the date of execution of this Agreement, and the
Common Stock shall have been at all times since such date listed for trading
on
a Trading Market;
(f) Company
Deliverables.
The
Company shall have delivered to such Investor the Company Deliverables;
and
(g) Minimum
Subscriptions.
The
aggregate of the Investors' Investment Amount shall not be less than $2,000,000.
5.2 Conditions
Precedent to the Obligations of the Company to sell Securities.
The
obligation of the Company to sell Securities at the Closing is subject to the
satisfaction or waiver by the Company, at or before the Closing, of each of
the
following conditions:
(a) Representations
and Warranties.
The
representations and warranties of the Investors contained herein shall be true
and correct in all material respects as of the date when made and as of the
Closing Date as though made on and as of such date;
(b) Performance.
Each
Investor shall have performed, satisfied and complied in all material respects
with all covenants, agreements and conditions required by the Transaction
Documents to be performed, satisfied or complied with by each Investor at or
prior to the Closing;
(c) No
Injunction.
No
statute, rule, regulation, executive order, decree, ruling or injunction shall
have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction that prohibits the consummation of any
of
the transactions contemplated by the Transaction Documents; and
(d) Minimum
Subscriptions.
The
aggregate of the Investors' Investment Amounts shall not be less than
$2,000,000.
ARTICLE
VI.
MISCELLANEOUS
6.1 Fees
and Expenses.
Each
party shall pay the fees and expenses of its advisers, counsel, accountants
and
other experts, if any, and all other expenses incurred by such party incident
to
the negotiation, preparation, execution, delivery and performance of the
Transaction Documents. The Company shall pay all stamp and other taxes and
duties levied in connection with the sale of the Securities.
6.2 Entire
Agreement.
The
Transaction Documents, together with the Exhibits and Schedules thereto, contain
the entire understanding of the parties with respect to the subject matter
hereof and supersede all prior agreements, understandings, discussions and
representations, oral or written, with respect to such matters, which the
parties acknowledge have been merged into such documents, exhibits and
schedules.
6.3 Notices.
Any and
all notices or other communications or deliveries required or permitted to
be
provided hereunder shall be in writing and shall be deemed given and effective
on the earliest of (a) the date of transmission, if such notice or communication
is delivered via facsimile (provided the sender receives a machine-generated
confirmation of successful transmission) at the facsimile number specified
in
this Section prior to 6:30 p.m. (New York City time) on a Trading Day, (b)
the
next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number specified in this Section
on
a day that is not a Trading Day or later than 6:30 p.m. (New York City time)
on
any Trading Day, (c) the Trading Day following the date of mailing, if sent
by
U.S. nationally recognized overnight courier service, or (d) upon actual receipt
by the party to whom such notice is required to be given. The address for such
notices and communications shall be as follows:
If
to the
Company: DOR
BioPharma Inc.
0000
Xxxxxxxx Xxx.
Xxxxx
000
Xxxxx
Xxxxx,
Xxxxxxx 00000
Attn:
President
Facsimile:
(000) 000-0000
With
a
copy to: Xxxxxxx
Xxxxxx Xxxxxx & Dodge LLP
000
X.
Xxx Xxxx Xxxxxxxxx
Xxxxx
0000
Xxxx
Xxxxxxxxxx, XX 00000-0000
Attn:
Xxxxxx X. Xxxxxxx, P.A.
Facsimile:
(000)
000-0000
If
to an
Investor: To
the
address set forth under the Investor's name
on
the
signature pages hereof;
or
such
other address as may be designated in writing hereafter, in the same manner,
by
such Person.
6.4 Amendments;
Waivers; No Additional Consideration.
No
provision of this Agreement may be waived or amended except in a written
instrument signed by the Company and the Investors holding a majority of the
Shares. No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in
the
future or a waiver of any subsequent default or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of either
party
to exercise any right hereunder in any manner impair the exercise of any such
right. No consideration shall be offered or paid to any Investor to amend or
consent to a waiver or modification of any provision of any Transaction Document
unless the same consideration is also offered to all Investors who then hold
Securities.
6.5 Construction.
The
headings herein are for convenience only, do not constitute a part of this
Agreement and shall not be deemed to limit or affect any of the provisions
hereof. The language used in this Agreement will be 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. This Agreement shall be
construed as if drafted jointly by the parties, and no presumption or burden
of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement or any of the Transaction
Documents.
6.6 Successors
and Assigns.
This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and permitted assigns. The Company may not assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Investor. Each Investor may assign any or all of its rights
under
this Agreement to one and only one Person to whom such Investor assigns or
transfers any Securities, provided such transferee agrees in writing to be
bound, with respect to the transferred Securities, by the provisions hereof
that
apply to the "Investor."
6.7 No
Third-Party Beneficiaries.
This
Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person, except as otherwise set
forth
in Section 4.7 (as to the Investor Party).
6.8 Governing
Law.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of Delaware, without regard to the
principles of conflicts of law thereof. Each party agrees that all Proceedings
concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement and any other Transaction Documents (whether
brought against a party hereto or its respective Affiliates, employees or
agents) may be commenced exclusively in the Chancery Court, State of Delaware
(the “Delaware
Court”).
Each
party hereto hereby irrevocably submits to the exclusive jurisdiction of the
Delaware Court for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of the any of the Transaction
Documents), and hereby irrevocably waives, and agrees not to assert in any
Proceeding, any claim that it is not personally subject to the jurisdiction
of
any such Delaware Court, or that such Proceeding has been commenced in an
improper or inconvenient forum. Each party hereto hereby irrevocably waives
personal service of process and consents to process being served in any such
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 manner permitted by law. Each party hereto hereby irrevocably waives,
to
the fullest extent permitted by applicable law, any and all right to trial
by
jury in any legal proceeding arising out of or relating to this Agreement or
the
transactions contemplated hereby. If either party shall commence a Proceeding
to
enforce any provisions of a Transaction Document, then the prevailing party
in
such Proceeding shall be reimbursed by the other party for its reasonable
attorneys’ fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such Proceeding.
6.9 Survival.
The
representations, warranties, agreements and covenants contained herein shall
survive the Closing and the delivery of the Shares.
6.10 Execution.
This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to
the
other party, it being understood that both parties need not sign the same
counterpart. In the event that any signature is delivered by facsimile
transmission, 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 signature page were an original
thereof.
6.11 Severability.
If any
provision of this Agreement is held to be invalid or unenforceable in any
respect, the validity and enforceability of the remaining terms and provisions
of this Agreement shall not in any way be affected or impaired thereby and
the
parties will attempt to agree upon a valid and enforceable provision that is
a
reasonable substitute therefor, and upon so agreeing, shall incorporate such
substitute provision in this Agreement.
6.12 Rescission
and Withdrawal Right.
Notwithstanding anything to the contrary contained in (and without limiting
any
similar provisions of) the Transaction Documents, whenever an Investor exercises
a right, election, demand or option under a Transaction Document and the Company
does not timely perform its related obligations within the periods therein
provided, then such Investor may rescind or withdraw, in its sole discretion
from time to time upon written notice to the Company, any relevant notice,
demand or election in whole or in part without prejudice to its future actions
and rights.
6.13 Replacement
of Securities.
If any
certificate or instrument evidencing any Securities is mutilated, lost, stolen
or destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation thereof, or in lieu of and substitution
therefor, a new certificate or instrument, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction and
customary and reasonable indemnity, if requested. The applicants for a new
certificate or instrument under such circumstances shall also pay any reasonable
third-party costs associated with the issuance of such replacement Securities.
If a replacement certificate or instrument evidencing any Securities is
requested due to a mutilation thereof, the Company may require delivery of
such
mutilated certificate or instrument as a condition precedent to any issuance
of
a replacement.
6.14 Remedies.
In
addition to being entitled to exercise all rights provided herein or granted
by
law, including recovery of damages, the Investors and the Company will be
entitled to specific performance under the Transaction Documents. The parties
agree that monetary damages may not be adequate compensation for any loss
incurred by reason of any breach of obligations described in the foregoing
sentence and hereby agrees to waive in any action for specific performance
of
any such obligation the defense that a remedy at law would be
adequate.
6.15 Payment
Set Aside.
To the
extent that the Company makes a payment or payments to an Investor pursuant
to
any Transaction Document or an Investor enforces or exercises its rights
thereunder, and such payment or payments or the proceeds of such enforcement
or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other person under any law (including, without limitation,
any
bankruptcy law, state or federal law, common law or equitable cause of action),
then to the extent of any such restoration the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full
force
and effect as if such payment had not been made or such enforcement or setoff
had not occurred.
6.16 Independent
Nature of Investors' Obligations and Rights.
The
obligations of each Investor under any Transaction Document are several and
not
joint with the obligations of any other Investor, and no Investor shall be
responsible in any way for the performance of the obligations of any other
Investor under any Transaction Document. The decision of each Investor to
purchase Securities pursuant to the Transaction Documents has been made by
such
Investor independently of any other Investor. Nothing contained herein or in
any
Transaction Document, and no action taken by any Investor pursuant thereto,
shall be deemed to constitute the Investors as a partnership, an association,
a
joint venture or any other kind of entity, or create a presumption that the
Investors are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by the Transaction Document. Each
Investor acknowledges that no other Investor has acted as agent for such
Investor in connection with making its investment hereunder and that no Investor
will be acting as agent of such Investor in connection with monitoring its
investment in the Securities or enforcing its rights under the Transaction
Documents. Each Investor shall be entitled to independently protect and enforce
its rights, including without limitation the rights arising out of this
Agreement or out of the other Transaction Documents, and it shall not be
necessary for any other Investor to be joined as an additional party in any
proceeding for such purpose. The Company acknowledges that each of the Investors
has been provided with the same Transaction Documents for the purpose of closing
a transaction with multiple Investors and not because it was required or
requested to do so by any Investor.
IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as
of
the date first indicated above.
DOR
BIOPHARMA, INC.
By:
/s/
Xxxxxxxxxxx X. Xxxxxxx
Name:
Xxxxxxxxxxx X. Xxxxxxx
Title:
Chief Executive Officer
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxx
Butts__________
Name: Xxxxxx
Xxxxx
|
Title:
|
Managing
Member
|
Southpoint
Master Fund
Investment
Amount: $_4,000,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxxxxxxx
X. Xxxxxxx and Xxxxxxxx Xxxxxxx
|
Name:
|
Xxxxxxxxxxx
X. Xxxxxxx and Xxxxxxxx Xxxxxxx
|
|
Title:
|
Investment
Amount: $_100,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxx
Xxxxxxxxxxxxxxx and Xxxxxxxxxxx Xxxxxxxxxxxxxxx JTWROS
|
Name:
|
Xxxx
Xxxxxxxxxxxxxxx and Xxxxxxxxxxx Xxxxxxxxxxxxxxx
JTWROS
|
|
Title:
|
Investment
Amount: $_25,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxx
Xxxxxxxxxxxxxxx and Xxxxxxxxx Xxxxxxxxxxxxxxx
|
Name:
|
Xxxxxx
Xxxxxxxxxxxxxxx and Xxxxxxxxx Xxxxxxxxxxxxxxx
|
|
Title:
|
Investment
Amount: $_25,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxx
Xxxxxxx
|
Name:
|
Xxxxx
Xxxxxxx
|
|
Title:
|
Investment
Amount: $_25,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxx
X. Xxxxxx
|
Name:
|
Xxxxx
X. Xxxxxx
|
|
Title:
|
Investment
Amount: $_100,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxx
Xxxxxxx
|
Name:
|
Xxxxxx
Xxxxxxx
|
Director
Firebird
Global Master Fund
|
Title:
|
Investment
Amount: $_500,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxxx
X. Xxxxxxx
|
Name:
|
Xxxxxxx
X. Xxxxxxx
|
|
Title:
|
Investment
Amount: $_500,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxx
X. Xxxxxxxx
|
Name:
|
Xxxxxx
X. Xxxxxxxx
|
|
Title:
|
Investment
Amount: $_50,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxx
Xxxxxxx
|
Name:
|
Xxxxx
Xxxxxxx
|
|
Title:
|
Investment
Amount: $_50,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxxx
Xxxxxxx
|
Name:
|
Xxxxxxx
Xxxxxxx
|
|
Title:
|
Investment
Amount: $_50,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxx
Xxxxxxx
|
Name:
|
Xxxx
Xxxxxxx
|
|
Title:
|
Investment
Amount: $_50,000_________________
Address
for Notice:
IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as
of the date first written above.
By:_/s/Xxxxxxx
X. Xxxxxxx
|
Name:
|
Xxxxxxx
X. Xxxxxxx
|
|
Title:
|
Investment
Amount: $_15,000_________________
Address
for Notice:
SCHEDULE
3.1(g)
In
connection with the execution of a stock purchase agreement dated April 6,
2006,
certain investors have anti-dilution rights that expire on the earlier of (i)
April 10, 2007 and (ii) the date that the FDA approves the New Drug Application
for orBec®.
In
connection with the execution of a stock purchase agreement dated April 6,
2006,
certain investors have been granted rights of participation that expire on
the
earlier of (i) April 10, 2007 and (ii) the date that each such investor no
longer holds of record at least 25% of the shares purchased by such investor
thereunder.
|
DOR
BioPharma, Inc
|
|||
|
Summary
schedule of outstanding warrants
|
|||
|
|
|
|
|
|
Exercise
|
Current
|
Expiration
|
|
|
Price
|
Outstanding
|
Date
|
|
|
1.8209
|
2,012,622
|
4/16/2008
|
|
|
5.2500
|
226,190
|
10/11/2007
|
|
|
8.1100
|
207,070
|
11/8/2008
|
|
|
0.7500
|
1,741,933
|
12/30/2007
|
|
|
0.3500
|
310,787
|
12/30/2007
|
|
|
0.8194
|
6,801,920
|
9/17/2008
|
|
|
0.8756
|
1,359,384
|
9/17/2008
|
|
|
0.8700
|
1,980,429
|
3/15/2009
|
|
|
0.5600
|
600,000
|
6/16/2009
|
|
|
0.5050
|
6,297,075
|
8/8/2010
|
|
|
0.6250
|
629,708
|
8/8/2010
|
|
|
0.2460
|
11,836,882
|
4/10/2009
|
|
|
0.3400
|
735,744
|
4/10/2009
|
|
|
0.4500
|
635,744
|
4/10/2009
|
|
|
0.4500
|
150,000
|
1/31/2008
|
|
|
0.2600
|
250,000
|
10/24/2008
|
|
|
Total
|
35,775,487
|
||
|
DOR
BioPharma, Inc
|
|||
|
Summary
schedule of outstanding options
|
|||
|
Exercise
|
Number
of
|
Expiration
|
|
|
Price
|
Options
|
Date
|
|
|
|
|
|
|
|
2.469
|
242,000
|
10/21/2007
|
|
|
5.625
|
35,000
|
11/28/2007
|
|
|
2.000
|
7,500
|
2/23/2009
|
|
|
1.380
|
12,000
|
10/21/2009
|
|
|
2.540
|
36,000
|
10/25/2009
|
|
|
3.938
|
9,000
|
2/8/2010
|
|
|
1.250
|
50,000
|
2/21/2011
|
|
|
0.740
|
307,839
|
11/29/2011
|
|
|
0.400
|
100,000
|
11/10/2007
|
|
|
0.250
|
50,000
|
11/10/2007
|
|
|
0.200
|
200,000
|
11/29/2012
|
|
|
0.200
|
200,000
|
11/10/2007
|
|
|
0.350
|
150,000
|
11/14/2012
|
|
|
0.350
|
2,000,000
|
11/30/2007
|
|
|
0.990
|
100,000
|
3/6/2008
|
|
|
0.850
|
300,000
|
11/10/2007
|
|
|
1.280
|
75,000
|
5/1/2013
|
|
|
0.580
|
150,000
|
7/2/2013
|
|
|
1.280
|
75,000
|
5/1/2013
|
|
|
0.900
|
100,000
|
9/15/2013
|
|
|
0.900
|
150,000
|
11/10/2007
|
|
|
0.900
|
50,000
|
11/30/2007
|
|
|
0.760
|
105,000
|
11/18/2013
|
|
|
1.000
|
100,000
|
2/11/2014
|
|
|
0.580
|
50,000
|
6/11/2014
|
|
|
0.580
|
150,000
|
11/10/2007
|
|
|
0.580
|
150,000
|
9/9/2014
|
|
|
0.580
|
50,000
|
11/30/2007
|
|
|
0.450
|
100,000
|
10/22/2014
|
|
|
0.470
|
300,000
|
11/10/2014
|
|
|
0.460
|
1,340,000
|
8/24/2007
|
|
|
0.490
|
500,000
|
12/13/2014
|
|
|
0.450
|
150,000
|
2/22/2015
|
|
|
0.290
|
100,000
|
1/10/2016
|
|
|
0.330
|
1,645,000
|
5/10/2016
|
|
|
0.270
|
2,500,000
|
8/29/2016
|
|
|
0.425
|
100,000
|
1/23/2017
|
|
|
0.430
|
200,000
|
1/25/2017
|
|
|
Total
|
11,939,339
|
|
|
SCHEDULE
3.1(u)
On
January 3, 2007, in connection with a letter of intent agreement with Sigma
Tau
Pharmaceuticals, Inc. (“Sigma Tau”), the Company granted piggy-back registration
rights to Sigma-Tau in connection with the issuance of 4,065,041 shares of
common stock. The Company granted demand registration rights with regard to
the
4,065,041 shares of common stock, which are exercisable after March 31, 2007.
Finally, the Company granted demand registration rights, which become
exercisable three months after issuance of the shares, to Sigma Tau with regard
$2 million worth of the Company’s common stock that may be purchased upon
election by Sigma Tau, provided certain events occur.
In
connection with anti-dilution rights granted to investors in connection with
a
securities purchase agreement dated April 6, 2006, the Company may be obligated
to register new shares of common stock.
SCHEDULE
4.4
The
Company has an obligation to keep the registration statements, as amended,
identified below continuously effective under the Securities Act of 1933 until
the date when all securities registered thereon have been sold or may be sold
(assuming for such purposes that the holder shall elect to utilize the cashless
or net exercise provisions under the warrants) without volume restrictions
pursuant to Rule 144(k) promulgated under the Securities Act of 1933. The
Company will be required to file post-effective amendments to each of the
registration statements set forth below upon filing its Form 10KSB for the
year
ended December 31, 2006.
|
Registration
Statement
|
Filing
Date
|
Effective
Date
|
File
Number
|
|||
|
SB-2
|
5-10-2006
|
5-26-2006
|
333-133975
|
|||
|
S-1
|
1-20-2006
|
2-13-2006
|
333-131166
|
|||
|
S-3
|
3-11-2005
|
4-6-2005
|
333-123281
|
|||
|
S-3
|
4-15-2004
|
4-27-2004
|
333-114494
|
EXHIBIT
A
Registration
Rights Agreement
