Exhibit 4.4
WARRANT AGREEMENT
By and Between
VION PHARMACEUTICALS, INC.
and
XXXXX XXXXXX & CO., INC.
Dated as of ____ __, 1999
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of ____ __, 1999 by and between VION
PHARMACEUTICALS, INC., a Delaware corporation (the "Company"), and XXXXX XXXXXX
& CO., INC. (the "Underwriter") (the Company and the Underwriter are referred to
collectively herein as the "Parties").
The Company proposes to issue to the Underwriter warrants as hereinafter
described (the "Warrants") to purchase up to an aggregate of 360,000 shares of
the Company's Common Stock, $0.01 par value per share (the "Common Stock"),
subject to adjustment as provided in Section 8 hereof (such 360,000 shares, as
adjusted, being hereinafter referred to as the "Shares"). Each warrant entitles
the holder ("Holder") thereof to purchase one share of Common Stock. All
capitalized terms used herein and not otherwise defined herein shall have the
same meanings as in that certain underwriting agreement, of even date herewith,
by and between the Company and the Underwriter (the "Underwriting Agreement").
NOW, THEREFORE, in consideration of the following promises and mutual
agreements and for other good and valuable consideration, the Parties agree as
follows:
1. Issuance of Warrants; Form of Warrant. On the Closing Date the Company
will issue, sell and deliver the Warrants to the Underwriter or its bona fide
officers for an aggregate price of $100. The Warrants shall be issued to the
Underwriter or such designees in the amounts set forth on Schedule I attached
hereto. The form of the Warrant and the Form of Election to Purchase attached
thereto shall be substantially as set forth on Exhibit A attached hereto. The
Warrants shall be executed on behalf of the Company by the manual or facsimile
signature of the present or any future President or any Vice President of the
Company, under its corporate seal, affixed or in facsimile, and attested by the
manual or facsimile signature of the present or any future Secretary or
Assistant Secretary of the Company. The Underwriter and each other Holder,
severally and not jointly, represents and warrants to the Company that (i) such
Holder is acquiring the Warrants, and any Shares acquired upon exercise of any
Warrants, for such Holder's own account and not with a view to, or for sale in
connection with, any distribution of the Warrants or any shares of Common Stock,
unless such distribution is registered or exempt from registration under the
Securities Act of 1933, as amended (the "Act"), and any applicable state and
foreign securities or blue sky laws and (ii) such Holder is aware that the
Warrants and the Shares have not been registered under the Act or the securities
or blue sky laws of any state or other jurisdiction, and that the Warrants may
not be exercised and the Warrants and the Shares may not be resold (and the
Holder covenants not to resell them) unless they are registered under applicable
federal and state securities laws or unless exemptions from all such applicable
registration requirements are available, and that the Warrants and the Shares
will be legended to indicate the foregoing restrictions.
2. Registration. The Warrants shall be numbered and shall be registered in
a Warrant register (the "Warrant Register"). The Company shall be entitled to
treat the registered holder of any Warrant on the Warrant Register as the owner
in fact thereof for all purposes and shall not be bound to recognize any
equitable or other claim to or interest in such
Warrant on the part of any other person, and shall not be liable for any
registration or transfer of Warrants that are registered or are to be registered
in the name of a fiduciary or the nominee of a fiduciary. The Warrants shall be
registered initially in the name of the Underwriter in such denominations as the
Underwriter may request in writing from the Company; provided, however, that the
Underwriter may designate that all or a portion of the Warrants be issued in
varying amounts directly to its bona fide officers and not to the Underwriter.
Such designation will only be made by the Underwriter if it determines that such
issuances would not violate the interpretation of the Board of Governors of the
National Association of Securities Dealers, Inc. (the "NASD") relating to the
review of corporate financing arrangements.
3. Transfer of Warrants. The Warrants will not be sold, transferred,
assigned or hypothecated, in whole or in part, prior to the first anniversary of
the effective date of the Registration Statement (the "Effective Date"), and
thereafter only to bona fide officers, directors, stockholders, employees or
registered representatives of the Underwriter upon written request to the
Company (including a certificate of the Holder that the transferee is a
permitted transferee under this Section 3) delivered in accordance with Section
12 hereof and upon delivery of the Warrant Certificate to the Company with the
form of assignment at the end thereof duly endorsed by the Holder or by its duly
authorized attorney or representative. In all cases of transfer by an attorney,
the original power of attorney, duly approved, or an official copy thereof, duly
certified, shall be deposited with the Company. In case of transfer by
executors, administrators, guardians or other legal representatives, duly
authenticated evidence of their authority shall be produced and may be required
to be deposited with the Company in its discretion. Upon any registration of
transfer, the Company shall deliver a new Warrant or Warrants to the persons
entitled thereto. Upon surrender of the Warrants to the Company or its duly
authorized agent, any of the Warrants may be exchanged at the option of its
Holder for other Warrants of different denominations, of like tenor and
representing in the aggregate the right to purchase a like number of shares of
Common Stock. The Company may require payment of a sum sufficient to cover all
taxes and other governmental charges that may be imposed in connection with any
transfer, exchange or other disposition of the Warrants or Shares. However, the
Company shall have no obligation to cause Warrants or Shares to be transferred
on its books to any person, if such transfer would violate the Act, the rules
and regulations promulgated thereunder (the "Rules and Regulations") or
applicable state securities laws, rules and regulations.
4. Term of Warrants; Exercise of Warrants.
(a) Term of Warrants. Each Warrant entitles the registered owner
thereof to purchase one fully paid and nonassessable Share at a purchase price
of $____ per Share (as adjusted from time to time pursuant to the provisions
hereof, the "Exercise Price") at any time from the first anniversary of the
Effective Date until 5:00 p.m., New York City time, on ____ __, 2004 (the
"Warrant Expiration Date").
(b) Exercise of Warrants. The Exercise Price and the Shares issuable
upon exercise of Warrants are subject to adjustment upon the occurrence of
certain events, pursuant
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to the provisions of Section 8 of this Agreement. Subject to the provisions of
this Agreement, and in addition to the right to surrender Warrants without any
cash payment as set forth in subsection (c) below, each Holder shall have the
right to purchase from the Company the number of fully-paid and nonassessable
Shares specified in such Warrants, upon (i) surrender to the Company, or its
duly authorized agent, of such Warrants, with the Form of Election to Purchase
attached thereto duly completed and signed, with signatures guaranteed by a
member firm of a national securities exchange, a commercial bank (not a savings
bank or savings and loan association) or trust company located in the United
States or a member of the NASD, (ii) payment to the Company of the Exercise
Price, as adjusted in accordance with the provisions of Section 8 of this
Agreement, for the number of Shares in respect of which such Warrants are then
exercised and (iii) compliance with the requirements of the Act, the Rules and
Regulations and applicable state securities laws, rules and regulations (clauses
(i), (ii) and (iii) above are hereinafter collectively referred to as the
"Exercise Requirements"). No adjustment shall be made for any cash dividends
paid to stockholders of record before the date on which the Warrants are
exercised. Upon completion of the Exercise Requirements, the Company shall issue
and cause to be delivered, no later than three (3) trading days following such
surrender, to the Holders or (subject to Section 3) to such person or persons
and in such name or names as such Holder may designate, a certificate or
certificates for the number of full Shares so purchased upon the exercise of
such Warrants, together with cash, in respect of any fractional Shares otherwise
issuable upon such surrender, as provided in Section 9 of this Agreement. Such
certificate or certificates shall be deemed to have been issued and any person
so named therein shall be deemed to have become a holder of record of such
Shares as of the date of the completion of the Exercise Requirements; provided,
however, that if, at the date of surrender of such Warrants, the transfer books
for the shares of Common Stock or other class of securities issuable upon the
exercise of such Warrants shall be closed, the certificates for the Shares shall
be issuable as of the date such books shall next be opened (whether before, on
or after the Warrant Expiration Date) and until such date the Company shall be
under no duty to deliver any certificate for such Shares; provided further,
however, that the transfer books of record, unless otherwise required by law,
shall not be closed at any one time for a period longer than twenty (20) days.
The rights of purchase represented by the Warrants shall be exercisable, at the
election of the Holder(s) thereof, either in full or, from time to time, in part
and, if any Warrant is exercised in respect of less than all of the Shares
issuable upon such exercise at any time prior to the Warrant Expiration Date, a
new Warrant or Warrants will be issued for the remaining number of Shares
specified in the Warrant so surrendered.
(c) Payment of Exercise Price. Payment of the Exercise Price may be
made in cash, by wire transfer of immediately available funds or by certified or
official bank check payable to the order of the Company. In addition and in lieu
of any cash payment, the Holder of the Warrants shall have the right at any
time, and from time to time, to exercise the Warrants in full or in part by
surrendering the Warrants in exchange for the number of Shares equal to the
product of (x) the number of shares as to which the Warrants are being exercised
multiplied by (y) a fraction, the numerator of which is the Market Price (as
defined in Section 8(d) below) of the Shares less the Exercise Price and the
denominator of which is such Market Price.
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5. Payment of Taxes. The Company will pay all documentary stamp taxes, if
any, attributable to the issuance of Shares upon the exercise of Warrants;
provided, however, that the Company shall not be required to pay any taxes
payable in connection with the transfer of any certificates for Shares in a name
other than that of the Holder of Warrants in respect of which such Shares are
issued, which taxes shall be paid by the Holder.
6. Mutilated or Missing Warrants. In the event any of the Warrants are
mutilated, lost, stolen or destroyed, the Company shall issue and deliver (i) in
exchange for and upon cancellation of the mutilated Warrant, or (ii) in lieu of
and substitution for the lost, stolen or destroyed Warrant, a new Warrant of
like tenor representing an equivalent right or interest; provided, however, that
the Company shall not be required to issue such substitute Warrant unless it
receives evidence reasonably satisfactory to the Company of ownership of such
Warrant and of such mutilation, loss, theft or destruction of such Warrant and
indemnity and affidavit of loss, if requested, reasonably satisfactory to the
Company. An applicant for such substitute Warrant shall also comply with such
other reasonable regulations and pay such other reasonable charges and expenses
as the Company may prescribe.
7. Reservation of Shares, etc. The Company has reserved, and shall at all
times keep reserved, out of the authorized and unissued shares of Common Stock,
a number of shares of Common Stock sufficient to provide for the exercise of the
Warrants. [Name of Transfer Agent], transfer agent for the Common Stock, and any
subsequent transfer agent for the Company's securities issuable upon the
exercise of the Warrants (the "Transfer Agent") will be irrevocably authorized
and directed at all times until the Warrant Expiration Date to reserve such
number of authorized and unissued shares as shall be required for such purpose.
The Company will keep a copy of this Agreement on file with the Transfer Agent.
The Company will supply the Transfer Agent with duly executed certificates for
such purpose and will itself provide or make available any cash distributable as
provided in Section 9 of this Agreement. All Warrants surrendered upon exercise
in compliance with this Agreement shall be canceled, and such canceled Warrants
shall constitute sufficient evidence of the number of Shares that are issuable
upon the exercise of such Warrants. No shares of Common Stock shall be subject
to reservation in respect of unexercised Warrants after the Warrant Expiration
Date.
8. Adjustments of Exercise Price and Number of Shares. The Exercise Price
and the number and kind of securities issuable upon exercise of each Warrant
shall be subject to adjustment from time to time upon the happening of certain
events, as follows:
(a) If the Company (i) declares a dividend on its Common Stock in
shares of Common Stock or makes a distribution to all holders of its Common
Stock in shares of Common Stock without charge to such holders, (ii) subdivides
its outstanding shares of Common Stock, (iii) combines its outstanding shares of
Common Stock into a smaller number of shares of Common Stock or (iv) issues by
reclassification of its Common Stock other securities of the Company (including
any such reclassification in connection with a consolidation or merger in which
the Company is the surviving entity, but excluding those referred to in
paragraph (b) below), the number and kind of Common Stock purchasable upon
exercise of each Warrant immediately prior thereto shall be adjusted so that the
Holder of each
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Warrant shall be entitled to receive the kind and number of shares of Common
Stock or other securities of the Company which such Holder would have owned or
have been entitled to receive after the happening of any of the events described
above, had such Warrant been exercised immediately prior to such event or any
record date with respect thereto. Any adjustment made pursuant to this paragraph
(a) shall become effective immediately after the effective date of such event
retroactive to immediately after the record date, if any, for such event.
(b) If the Company issues rights, options or warrants to all holders
of its Common Stock, without any charge to such holders, entitling them to
subscribe for or to purchase shares of Common Stock at a price per share lower
than the then current Market Price per share of Common Stock (as defined in
paragraph (d) below) at the record date mentioned below, the Holders of
unexercised Warrants as of such record date, upon exercise of such Warrants,
shall receive the same rights, options or warrants that such Holder would have
received or have been entitled to receive after such issuance, had such Warrants
been exercised immediately prior to such issuance or any record date with
respect thereto. Such adjustment shall be made whenever rights, options or
warrants are issued as described above and shall become effective retroactively
to immediately after the record date for the determination of stockholders
entitled to receive such rights, options or warrants.
(c) If the Company distributes to all holders of its Common Stock,
without any charge to such holders, shares of its stock other than shares of
Common Stock or evidences of its indebtedness or assets (excluding cash
dividends and dividends or distributions referred to in paragraph (a) or (b)
above) or rights, options or warrants or other securities convertible into or
exchangeable for shares of Common Stock (excluding those referred to in
paragraph (a) or (b) above), then in each case the Holders of unexercised
Warrants as of the record date mentioned below, upon exercise of such Warrants,
shall receive the same distribution that such Holder would have received or have
been entitled to receive after the distribution, had such Warrants been
exercised immediately prior to the distribution or any record date with respect
thereto. Such adjustment shall be made whenever any such distribution is made as
described above and shall become effective on the date of distribution
retroactive to immediately after the record date for the determination of
stockholders entitled to receive such distribution.
(d) For the purpose of any computation under paragraph (b) of this
Section 8, the current "Market Price" per share of Common Stock at any date
shall be the average of the daily closing prices for fifteen (15) consecutive
trading days commencing twenty (20) trading days before the date of such
computation. The closing price for each day shall be the last reported sale
price regular way or, if no such reported sale takes place on such day, the
average of the closing bid and asked prices regular way for such day, in either
case on the principal national securities exchange on which the shares are
listed or admitted to trading, or if they are not listed or admitted to trading
on any national securities exchange, but are traded in the over-the-counter
market, the closing sale price of the Common Stock or, if no sale is publicly
reported, the average of the representative closing bid and asked quotations for
the Common Stock on The Nasdaq National or SmallCap Market or any comparable
system, or if
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the Common Stock is not listed on The Nasdaq Stock Market or a comparable
system, the closing sale price of the Common Stock or, if no sale is publicly
reported, the average of the closing bid and asked prices as furnished by two
members of the NASD selected from time to time by the Company for that purpose.
(e) No adjustment in the number of Shares purchasable hereunder shall
be required unless such adjustment would result in an increase or decrease of at
least one percent (1%) in the number of Shares purchasable upon the exercise of
each Warrant; provided, however, that any adjustments which by reason of this
paragraph (e) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment but not later than three (3) years
after the happening of the specified event or events. All calculations shall be
made to the nearest one thousandth of a share.
(f) Whenever the number of Shares purchasable upon exercise of each
Warrant is adjusted, as herein provided, the Exercise Price shall be adjusted by
multiplying the Exercise Price in effect immediately prior to such adjustment by
a fraction, of which (i) the numerator shall be the number of Shares purchasable
upon the exercise of each Warrant immediately prior to such adjustment and (ii)
the denominator shall be the number of shares so purchasable immediately
thereafter.
(g) For the purpose of this Section 8, the term "Common Stock" shall
mean (i) the class of stock designated as the Common Stock of the Company at the
date of this Agreement or (ii) any other class of stock resulting from
successive changes or reclassifications of such shares consisting solely of
changes in par value, or from no par value to par value or from par value to no
par value. If at any time, as a result of an adjustment made pursuant to
paragraph (a) above, the Holders become entitled to purchase any shares of
capital stock of the Company other than shares of Common Stock, thereafter the
number of such other shares so purchasable upon exercise of each Warrant and the
Exercise Price of such shares shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable to the provisions
with respect to the Shares contained in paragraphs (a) through (f), inclusive,
and paragraphs (h) through (m), inclusive, of this Section 8, and the provisions
of Sections 4, 5, 7 and 10 hereof, with respect to the Shares, shall apply on
like terms to any such other shares.
(h) Upon the expiration of any rights, options, warrants or conversion
rights or exchange privileges that caused adjustments under this Section 8, such
adjustments with respect to any unexercised Warrants shall, upon such
expiration, be readjusted and shall thereafter be as they would have been had
such rights, options, warrants or conversion rights or exchange privileges never
existed.
(i) The Company may, at its option at any time during the term of the
Warrants, reduce the then current Exercise Price to any amount deemed
appropriate by the Board of Directors of the Company.
(j) Whenever the number of Shares issuable upon the exercise of each
Warrant or the Exercise Price of such Shares is adjusted, as herein provided,
the Company
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shall promptly mail by first class-mail, postage prepaid, to each Holder notice
of such adjustment or adjustments. No failure to mail such notice nor any defect
therein or in the mailing thereof shall affect the validity thereof except as to
the Holder to whom the Company failed to mail such notice or whose notice was
defective. A certificate of an officer of the Company, on behalf of the Company,
that such notice has been mailed shall be prima facie evidence of the facts
stated therein. After any such adjustment, the Company shall prepare a
certificate setting forth the number of Shares issuable upon the exercise of
each Warrant and the Exercise Price of such Warrant after such adjustment,
setting forth a brief statement of the facts requiring such adjustment. Such
certificate shall, except as provided below, be conclusive as to the correctness
of such adjustment, and each Holder shall have the right to inspect such
certificate during reasonable business hours. Any determination as to whether an
adjustment is required pursuant to this Section 8, or as to the amount of any
such adjustment, shall be initially made in good faith by the Board of Directors
of the Company. If the Holders of a majority of the then outstanding Warrants
shall, in the exercise of their discretion, object to such determination, the
amount of such adjustment shall be made by an independent accounting or
investment banking firm selected by the Holders of a majority of the then
outstanding Warrants and reasonably acceptable to the Company.
(k) Except as provided in this Section 8, no adjustment in respect of
any dividends shall be made during the term of a Warrant or upon the exercise of
a Warrant.
(l) If the Company consolidates with or merges into another
corporation or if the Company sells or conveys all or substantially all its
property to another corporation, or if the Company enters into a statutory share
exchange with another Company pursuant to which its Common Stock is exchanged
for, or changed into, securities or property of another Company, the Company or
such successor or purchasing corporation (or an affiliate of such successor or
purchasing corporation), as the case may be, agrees that each Holder shall have
the right thereafter upon payment of the Exercise Price in effect immediately
prior to such action to purchase upon exercise of each Warrant the kind and
amount of shares and other securities and property (including cash) that such
Holder would have owned or been entitled to receive after the happening of the
consolidation, merger, sale, conveyance or share exchange had such Warrant been
exercised immediately prior to such action. The provisions of this paragraph (l)
shall apply to successive consolidations, mergers, sales, conveyances or share
exchanges.
(m) Notwithstanding any adjustment in the Exercise Price or the number
or kind of shares purchasable upon the exercise of the Warrants pursuant to this
Agreement, certificates for Warrants issued prior or subsequent to such
adjustment may continue to express the same price and number and kind of shares
as are initially issuable pursuant to this Agreement.
9. Fractional Interests. The Company shall not be required to issue
fractions of Shares on the exercise of Warrants. If more than one Warrant is
presented for exercise in full at the same time by the same Holder, the number
of Shares issuable upon the exercise thereof shall be computed on the basis of
the aggregate number of Shares issuable on exercise of the Warrants so
presented. If any fraction of a Share would, except for the provisions of this
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Section 9, be issuable on the exercise of any Warrants (or specified portions
thereof), the Company shall purchase such fraction for an amount in cash equal
to the same fraction of the current Market Price per share of Common Stock
(determined as provided in Section 8(d) of this Agreement) on the date of
exercise.
10. Registration Rights.
(a) Demand Registration Rights.
(i) The Company covenants and agrees with the Underwriter and any
other or subsequent Holders of the Registrable Securities (as defined in
paragraph (f) of this Section 10) that, upon the written request of the then
Holder(s) of Warrants, Registrable Securities or both, representing at least a
majority of the shares of Common Stock underlying the Warrants originally issued
to the Underwriter or its designees, made at any time within the period
commencing one (1) year and ending five (5) years after the Effective Date, the
Company will file as promptly as practicable and, in any event, within sixty
(60) days after receipt of such written request, at its expense (other than (x)
all underwriters', broker-dealers', placement agents' and similar selling
discounts, commissions and fees relating to the sale of the Holder's Registrable
Securities, (y) any costs and expenses of counsel, accountants or other advisors
retained by the Holder and (z) all transfer, franchise, capital stock and other
taxes, if any, applicable to the Holder's Registrable Securities (collectively,
"Holders' Expenses"), all of which shall be paid by the Holder), no more than
once (except as otherwise provided below), a post-effective amendment (the
"Amendment") to the Company's Registration Statement on Form S-1, Registration
No. 333-_____ as filed with the Securities and Exchange Commission on _____ __,
1999, or a new registration statement on an appropriate form under the Act,
registering or qualifying the Registrable Securities for sale in accordance with
the intended method of sale or other disposition described in such request.
Within fifteen (15) days after receiving any such notice, the Company shall give
notice to the other Holders of the outstanding Warrants or Registrable
Securities advising that the Company is proceeding with such Amendment or
registration statement and offering to include the Registrable Securities of
such Holders. The Company shall not be obligated to any other such Holder unless
that other Holder accepts such offer by notice in writing to the Company within
twenty (20) days thereafter. The Company will use its best efforts, through its
officers, directors, auditors and counsel in all matters necessary or advisable,
to file and cause such Amendment or registration statement to become effective
as promptly as practicable (but in any event within ninety (90) days of the
initial filing of such Amendment or registration statement) and for a period of
twelve (12) months thereafter to reflect in the Amendment or registration
statement financial statements prepared in accordance with Section 10(a)(3) of
the Act and any facts or events arising that, individually, or in the aggregate,
represent a fundamental or material change in the information set forth in the
Amendment or registration statement to enable Holders of the Registrable
Securities registered to sell such Registrable Securities. The Holders may
register the Registrable Securities for sale pursuant to the Amendment or
registration statement without exercising the Warrants. If any registration
pursuant to this paragraph (a) is an underwritten offering, the Holders of a
majority of the
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Registrable Securities to be included in such registration shall be entitled to
select the underwriter or managing underwriter (in the case of a syndicated
offering) of such offering.
(ii) Anything in this Section 10(a) to the contrary
notwithstanding, if the Company's securities proposed to be registered for sale
are to be distributed in an underwritten offering and the managing underwriter
shall advise the Company in writing that, in its opinion, the amount of
securities to be offered should be limited in order to assure a successful
offering, the amount of Registrable Securities to be included in such Amendment
or registration statement shall be so limited and shall be allocated among the
persons selling such securities in the following order of priority: (x) first,
securities subject to any demand or piggyback registration rights granted by the
Company before the Effective Date, (y) next, Registrable Securities in
proportion, as nearly as practicable, to the number of Registrable Securities
desired and eligible to be sold by each Holder of such Registrable Securities
and (z) next, any other shares of Common Stock subject to similar demand or
piggyback registration rights granted by the Company in proportion, as nearly as
practicable, to the number of shares of Common Stock desired and eligible to be
sold by each holder of such Common Stock. In the event that, (x) pursuant to the
preceding sentence, the managing underwriter limits the number of Registrable
Securities that the Holders desire to have registered and (y) the Company does
not thereafter effect a registration to include the Registrable Securities that
the Holders were not then permitted to sell within one hundred eighty (180) days
after the effective date of the Amendment or registration statement from which
the Holders have been excluded, then, at any time after such one hundred eighty
(180) day period until the period ending five (5) years after the Effective
Date, the Holders of a majority of such Registrable Securities not so included
may make a request to the Company for registration under the Act of all or part
of such Registrable Securities not so included in accordance with Section
10(a)(ii).
(iii) Notwithstanding anything in this Section 10(a) to the
contrary, the Company will not be required to file an Amendment or registration
statement (i) at a time when the audited financial statements required to be
included therein are not available, which time shall be limited to the period
commencing one hundred thirty five (135) days after the end of the Company's
third quarter and ending ninety (90) days after the end of such fiscal year,
(ii) for the period beginning with the filing of a registration statement under
the Act with respect to a public offering by the Company of its securities and
ending one hundred eighty (180) days after the closing of such public offering
or (iii) if in the reasonable opinion of the Company it would adversely impact
the Company in its capital raising plans or otherwise (in which latter case
filing may be delayed for up to one hundred thirty five (135) days).
(b) Piggyback Registration Rights. The Company covenants and agrees
with the Underwriter and any other Holders or subsequent Holders of the
Registrable Securities that if, at any time within the period commencing one (1)
year and ending five (5) years after the Effective Date, it proposes to file a
new registration statement with respect to the public sale of Common Stock for
cash (other than in connection with an offering to the Company's employees, an
acquisition, merger or similar transaction, an employee benefit plan, an
exchange offer or a dividend reinvestment plan) under the Act in a primary
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registration on behalf of the Company and/or in a secondary registration on
behalf of holders of such securities and the registration form to be used may be
used for registration of the Registrable Securities, the Company will give
written notice at least thirty (30) days prior to such filing to the Holders of
Warrants or Registrable Securities (regardless whether some of the Holders have
theretofore availed themselves of the right provided in Section 10(a) of this
Agreement) at the addresses appearing on the records of the Company of its
intention to file a registration statement and will use its best efforts to
include in such registration statement any of the Registrable Securities,
subject to clauses (i) and (ii) of this paragraph (b), such number of
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within twenty (20) days after notice by the
Company. All registrations requested pursuant to this paragraph (b) are referred
to herein as "Piggyback Registrations." All Piggyback Registrations pursuant to
this paragraph (b) will be made solely at the Company's expense, except for the
Holders' Expenses, which respective portion shall be paid by each Holder. If the
securities or blue sky laws of any jurisdiction in which the securities are
proposed to be offered would require the Holder's payment of greater
registration expenses than those otherwise required by this Section 10 and if
the Company shall determine, in good faith, that the offering of such securities
in such jurisdiction is necessary for the successful consummation of the
registered offering, then the Holder shall either agree to pay such Holder's
portion of the registration expenses required by the securities or blue sky laws
of such jurisdiction or withdraw his request for inclusion of his Registrable
Securities in such registration.
(i) Priority on Primary Registrations. If a Piggyback
Registration is part of an underwritten primary registration for the Company and
the managing underwriter(s) for such offering advise(s) the Company in writing
that, in its opinion, the amount of securities to be offered should be limited
in order to assure a successful offering, the amount of Registrable Securities
to be included in such registration statement shall be so limited and shall be
allocated among the persons selling such securities in the following order of
priority: (w) first, securities the Company proposes to sell, (x) next,
securities subject to any demand or other piggyback registration rights granted
by the Company before the Effective Date, (y) next, Registrable Securities in
proportion, as nearly as practicable, to the number of Registrable Securities
desired and eligible to be sold by each Holder of such Registrable Securities
and (z) next, any other shares of Common Stock subject to similar demand or
piggyback registration rights granted by the Company in proportion, as nearly as
practicable, to the number of shares of Common Stock desired and eligible to be
sold by each holder of such Common Stock.
(ii) Priority on Secondary Registrations. If a Piggyback
Registration is part of an underwritten secondary registration for holders of
securities of the Company (other than pursuant to Section 10(a)) and not a
primary registration for the Company and the managing underwriter(s) for such
offering advise(s) the Company in writing that, in its opinion, the amount of
securities to be offered should be limited in order to assure a successful
offering, the amount of Registrable Securities to be included in such
registration statement shall be so limited and shall be allocated among the
persons selling such securities in the following order of priority: (x) first,
securities subject to any demand or other piggyback
-10-
registration rights granted by the Company before the Effective Date, (y) next,
Registrable Securities in proportion, as nearly as practicable, to the number of
Registrable Securities desired and eligible to be sold by each Holder of such
Registrable Securities and (z) next, any other shares of Common Stock subject to
similar demand or piggyback registration rights granted by the Company in
proportion, as nearly as practicable, to the number of shares of Common Stock
desired and eligible to be sold by each holder of such Common Stock.
Notwithstanding the provisions of this Section 10(b), the Company shall
have the right at any time and for any reason or for no reason after having
given written notice pursuant to this Section 10(b) (irrespective of whether a
written request for inclusion of any such securities has been made) to elect not
to file any such proposed registration statement, or to withdraw the same after
the filing but before the effective date thereof and, thereupon, shall be
relieved from its obligation to proceed with such registration. If any
registration pursuant to this paragraph (b) is an underwritten offering, the
Company shall be entitled to select the underwriter or managing underwriter(s)
(in the case of a syndicated offering) of such offering.
(c) Other Registration Rights. In addition to the rights above
provided, during the period commencing one (1) year and ending five (5) years
after the Effective Date, the Company will cooperate with the then Holders of
the Registrable Securities in preparing and signing one (but not more than one)
registration statement, in addition to the registration statements discussed
above, required in order to sell or transfer the Registrable Securities and will
supply all information required therefor, but the then Holders shall pay the
costs and expenses of such additional registration (including all of the
Company's reasonable out-of-pocket costs and expenses); provided, however, that
if the Company elects to register or qualify additional shares of Common Stock,
the cost and expense of such registration statement will be pro rated between
the Company and the Holders of the Registrable Securities according to the
aggregate sales price of the securities being issued. However, the Company will
not be required to file a registration statement pursuant to this paragraph (c)
(i) at a time when the audited financial statements required to be included
therein are not available, which time shall be limited to the period commencing
one hundred thirty five (135) days after the end of the Company's third quarter
and ending ninety (90) days after the end of such fiscal year, (ii) for the
period beginning with the filing of a registration statement under the Act with
respect to a public offering by the Company of its securities and ending one
hundred eighty (180) days after the closing of such public offering or (iii) if
in the reasonable opinion of the Company it would adversely impact the Company
in its capital raising plans or otherwise (in which latter case filing may be
delayed for up to one hundred thirty five (135) days).
(d) Action to be Taken by the Company. In connection with the
registration of Registrable Securities in accordance with paragraphs (a), (b) or
(c) of this Section 10, the Company agrees to:
(i) bear the expenses of any registration or qualification under
paragraphs (a) or (b) of this Section 10, including, but not limited
to, legal, accounting and printing fees; provided, however, that in no
event shall the Company be obligated to pay any of the Holders'
Expenses, which shall be paid by the Holders; and
-11-
(ii) use its reasonable efforts to register or qualify the
Registrable Securities included in an Amendment or registration
statement for offer or sale under state securities or blue sky laws of
such jurisdictions in which the Underwriter or such Holders shall
reasonably request and do all other acts or things necessary or
advisable to effect the registration or qualification of the
Registrable Securities covered by such Amendment or registration
statement in the various states; provided, however, that no
registration or qualification shall be required in any jurisdiction
where, as a result thereof, the Company would be subject to service of
general process, taxation as a foreign corporation doing business in
such jurisdiction, any requirement that it qualify generally to do
business as a foreign corporation in such jurisdiction or any
requirement that it agree to restrictions on future actions by the
Company to which it is not then subject.
(e) Action to be Taken by the Holders. Any written request to exercise
registration rights pursuant to paragraphs (a) or (b) of this Section 10 shall
contain, as applicable, (i) a description of the proposed plan of distribution
of the Registrable Securities, including the name of any underwriters, the
amounts underwritten and any material relationship between any proposed
underwriter and the Company, (ii) the full name of the Holder, the number of
Warrants, Registrable Securities and other securities of the Company owned by
such Holder and the number proposed to be registered and (iii) a description of
any position, office or other material relationship which the Holder has had
within the past three (3) years with the Company or any of its predecessors or
affiliates.
In addition, in connection with the registration of Registrable Securities
in accordance with paragraphs (a), (b) or (c) of this Section 10, the Company's
obligation shall be conditioned as to each such public offering upon a timely
receipt by the Company in writing of:
(i) information as to participating Holders (to the extent
required by the Rules and Regulations) and the terms of such public
offering furnished by or on behalf of each Holder intending to make a
public offering of such Holder's Registrable Securities;
(ii) such other information as the Company may reasonably require
from such Holders, or any underwriter for any of them, for inclusion
in such Registration Statement; and
(iii) all documents reasonably requested by any underwriter in
connection with the offering and any other documents customary in
similar offerings, signed and delivered by such Holder, including,
without limitation, underwriting agreements, custody agreements,
powers of attorney, indemnification agreements, and agreements
restricting other sales of securities.
-12-
(f) For purposes of this Section 10, (i) the term "Holder" shall
include holders of Registrable Securities received upon exercise of Warrants,
and (ii) the term "Registrable Securities" shall mean the Shares, if issued,
until five (5) years after the Effective Date.
(g) Each Holder agrees that, upon receipt of any notice from the
Company of the happening of any of the following: (i) the issuance by the
Securities and Exchange Commission of any stop order denying or suspending the
effectiveness of any Amendment or registration statement covering Registrable
Securities or the initiation or threatening of any proceeding for that purpose,
(ii) the Company's receipt of any stop order denying registration or suspending
the qualification of the Registrable Securities for sale or the initiation or
threatening of any proceeding for such purpose or (iii) the happening of any
event that makes any statement made in such Amendment or registration statement,
the related prospectus or any document incorporated by reference therein untrue
or that requires any change in such Amendment or registration statement,
prospectus or document incorporated by reference therein to make the statements
not include an untrue statement of material fact or not omit any material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing, each Holder shall
discontinue the disposition of Registrable Securities until such Holder receives
a supplemental or amended prospectus from the Company or until the Company
advises such Holder in writing that the Holder may resume the use of such
prospectus and have received copies of any additional or supplemental filings
which are incorporated by reference in the prospectus. If the Company so
directs, such Holder will deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in the Holder's possession, of the
prospectus covering the Registrable Securities at the time the Holder received
the notice. Upon the occurrence of such event, the Company shall immediately
take such action as may be necessary to resume sale of the Registrable
Securities and the use of such prospectus, by amendment or otherwise.
11. Notices to Holders.
(a) Nothing in this Agreement or in any Warrants shall be construed as
conferring upon the Holders the right to vote or to receive dividends or to
consent or to receive notice as stockholders in respect of the meetings of
stockholders or the election of directors of the Company or any other matter or
any rights whatsoever as stockholders of the Company prior to the exercise of
Warrants and such Holder becoming a holder of record of Shares; provided,
however, that in the event that any meeting of stockholders shall be called, the
Company shall cause a notice thereof to be sent by first-class mail, postage
prepaid, at least twenty (20) days prior to the date fixed as a record date or
the date of closing the transfer books in relation to such meeting, to each
registered Holder of Warrants at such Holder's address appearing on the Warrant
Register.
(b) If the Company intends to make any distribution on its Common
Stock (or other securities that may be issuable in lieu thereof upon the
exercise of Warrants), including, without limitation, any such distribution to
be made in connection with a consolidation or merger in which the Company is the
surviving entity or to issue subscription rights or warrants to holders of its
Common Stock, the Company shall cause a notice of its intention to make such
distribution to be sent by first-class mail, postage prepaid, at least
-13-
twenty (20) days prior to the date fixed as a record date or the date of closing
the transfer books in relation to such distribution, to each registered Holder
of Warrants at such Holder's address appearing on the Warrant Register, but
failure to mail or to receive such notice or any defect therein or in the
mailing thereof shall not affect the validity of any action taken in connection
with such distribution.
12. Notices. Any notice pursuant to this Agreement to be given by the
Holder of any Warrant or the holder of any Share to the Company shall be
sufficiently given or made three business days after sent by first-class mail,
postage prepaid, addressed as follows or to such other address as the Company
may designate by notice given in accordance with this Section 12, to the Holders
of Warrants or the holders of Shares:
Vion Pharmaceuticals, Inc.
0 Xxxxxxx Xxxx
Xxx Xxxxx, XX 00000
Attn.: President
Notices or demands authorized by this Agreement to be given or made by the
Company to or on the Holder of any Warrant or the holder of any Share shall be
sufficiently given or made (except as otherwise provided in this Agreement) if
sent by first-class mail, postage prepaid, addressed to such Holder or such
holder of Shares at the address of such Holder or such holder of Shares as shown
on the Warrant Register or the books of the Company, as the case may be.
13. Governing Law. This Agreement and each Warrant issued hereunder shall
be governed by and construed in accordance with the substantive laws of the
State of New York, without giving effect to the principles of conflicts of law.
The Company hereby agrees to accept service of process by notice given to it
pursuant to the provisions of Section 12 hereof.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
such counterparts together shall constitute one and the same instrument.
-14-
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed as of the day, month and year first above written.
VION PHARMACEUTICALS, INC.
By: Xxxx Xxxxxxx
----------------------------------
Its: President and Chief Executive
Officer
------------------------------
XXXXX XXXXXX & CO., INC.
By: Xxxxxxxx Xxxxxxxx
---------------------------------
Its: Executive Vice President and
Senior Managing Director
-----------------------------
-15-
SCHEDULE I
Name of Number of
Initial Holder Warrants
-------------- ----------
Xxxxx Xxxxxx & Co., Inc. 360,000
Total 360,000
Exhibit A
No. _______ Warrant to Purchase
**360,000**
Shares of Common Stock
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY STATE OR OTHER
JURISDICTION. THIS WARRANT MAY NOT BE EXERCISED, AND THIS WARRANT AND THE SHARES
OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE RESOLD OR
OTHERWISE TRANSFERRED, UNLESS THEY ARE REGISTERED UNDER APPLICABLE STATE AND
FEDERAL SECURITIES LAWS OR UNLESS EXEMPTIONS FROM ALL SUCH REGISTRATION
REQUIREMENTS ARE AVAILABLE.
VOID AFTER 5:00 P.M. NEW YORK CITY TIME
ON _____ __, 2004
VION PHARMACEUTICALS, INC.
Warrant Certificate
THIS CERTIFIES THAT, for value received, Xxxxx Xxxxxx & Co., Inc., or
its registered assigns, is the owner of the number of warrants set forth above
(the "Warrants"), each of which entitles the owner thereof to purchase at any
time from ____ __, 2000, until 5:00 p.m., New York City time on ____ __, 2004
(the "Warrant Expiration Date"), one fully paid and nonassessable share of
Common Stock, $0.01 par value per share (the "Common Stock"), of VION
PHARMACEUTICALS, INC., a Delaware corporation (the "Company"), at the purchase
price of $_____ per Share (as adjusted from time to pursuant to the Warrant
Agreement referenced below, the "Exercise Price") upon presentation and
surrender of this Warrant Certificate with the Form of Election to Purchase duly
executed. The number of Warrants (and the number of shares of Common Stock that
may be purchased upon exercise hereof) set forth above and the Exercise Price
per share of Common Stock set forth above are the number and Exercise Price as
of the date of original issuance of the Warrants, based on the Common Stock of
the Company at such date. As provided in the Warrant Agreement referenced below,
the Exercise Price and the number or kind of shares that may be purchased upon
the exercise of the Warrants are, upon the happening of certain events, subject
to modification and adjustment. The shares of Common Stock, as so modified and
adjusted, are herein referred to as the "Shares".
This Warrant Certificate is subject to, and entitled to the benefits
of, all of the terms, provisions and conditions of an agreement dated as of
_____ __, 1999 (the "Warrant Agreement") between the Company and Xxxxx Xxxxxx &
Co., Inc., which Warrant Agreement is hereby incorporated herein by reference
and made a part hereof. Reference is made to the Warrant Agreement for a full
description of the rights, limitations of rights, duties and immunities
hereunder of the Company and the holders of the Warrant Certificates. Copies of
the Warrant Agreement are on file at the principal office of the Company.
Upon surrender at the principal office of the Company, this Warrant
Certificate, with or without other Warrant Certificates, may be exchanged for
another Warrant Certificate or Warrant Certificates of like tenor and date
evidencing warrants entitling the holder to purchase the aggregate number of
shares of Common Stock as the Warrants evidenced by the Warrant Certificate or
Warrant Certificates surrendered entitled such holder to purchase. If this
Warrant Certificate shall be exercised in part, the holder hereof shall be
entitled to receive, upon surrender hereof, another Warrant Certificate or
Warrant Certificates for the number of whole Warrants not exercised.
No fractional shares of Common Stock will be issued upon the exercise
of any Warrants evidenced hereby, but in lieu thereof a cash payment will be
made, as provided in the Warrant Agreement.
No holder of this Warrant Certificate will be entitled to vote,
receive dividends or subscription rights or be deemed the holder of the Shares
that may at any time be issuable on the exercise hereof for any purpose, nor
shall anything contained in the Warrant Agreement or herein be construed to
confer upon the holder hereof, as such, any of the rights of a stockholder of
the Company or any right to vote for the election of directors or upon any
matter submitted to stockholders at any meeting thereof, or to give or withhold
consent to any corporate action (whether upon any recapitalization, issue of
stock, reclassification of stock, change of par value or change of stock to no
par value, consolidation, merger, conveyance, or otherwise) or, except as
provided in the Warrant Agreement, to receive notice of meetings, until the
Warrants evidenced by this Warrant Certificate shall have been exercised and
such holder shall have become a holder of record of the Shares as provided in
the Warrant Agreement.
If this Warrant shall be surrendered for exercise during any period in
which the transfer books for the Shares are closed for any purpose, the Company
shall not be required to make delivery of certificates for Shares purchasable
upon such exercise until the date of the reopening of said transfer books,
provided, however, that such books shall not be closed for longer than a twenty
(20) day period.
-2-
IN WITNESS WHEREOF, VION PHARMACEUTICALS, INC. has caused the
signature (or facsimile signature) of its President and its Secretary to be
printed hereon.
Dated _____ __, 1999
VION PHARMACEUTICALS, INC.
By:_____________________________
Xxxx Xxxxxxx
President
Attest:
_____________________________
Xxxxxx X. Xxxxxxx
Secretary
-3-
FORM OF
ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer the
Warrant Certificate.)
FOR VALUE RECEIVED ________________________________ hereby sells,
assigns and transfers unto ________________________________ this Warrant
Certificate, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint __________________________ to transfer
the Warrant Certificate on the books of Vion Pharmaceuticals, Inc., with full
power of substitution.
Dated: _________________________
__________________________________
Signature
Signature Guaranteed:
NOTICE
The signature on the foregoing Assignment must correspond to the name
as written upon the face of the Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever.
-4-
FORM OF
ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Warrants)
TO: VION PHARMACEUTICALS, INC.
The undersigned hereby irrevocably elects to exercise Warrants
represented by this Warrant Certificate to purchase __________ shares of Common
Stock issuable upon the exercise of such Warrants and requests that certificates
for such shares of Common Stock be issued in the name of:
____________________________________
Please insert social security, tax identification or other identifying number
___________________________
___________________________
___________________________
If such number of Warrants is not all the Warrants evidenced by this Warrant
Certificate, a new Warrant Certificate for the balance remaining of such
Warrants shall be registered in the name of and delivered to:
Please insert social security, tax identification or other identifying number
___________________________
___________________________
___________________________
(Please print name and address)
Dated:________________________
__________________________________
Signature
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate)
Signature Guaranteed:
-5-
