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Exhibit 4.1
STOCK PURCHASE AGREEMENT
OSI Pharmaceuticals, Inc.
000 Xxxxxxx Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Ladies & Gentlemen:
The undersigned, Biotechnology Value Fund, L.P. (the "Investor"), hereby
confirms its agreement with you as follows:
1. This Stock Purchase Agreement (the "Agreement") is made as of February 24,
2000 between OSI Pharmaceuticals, Inc., a Delaware corporation (the "Company"),
and the Investor.
2. The Company has authorized the sale and issuance of up to 3,500,000 shares
(the "Shares") of common stock of the Company, $0.01 par value per share (the
"Common Stock"), subject to adjustment by the Company's Board of Directors, to
certain investors in a private placement (the "Offering").
3. The Company and the Investor agree that the Investor will purchase from the
Company and the Company will issue and sell to the Investor 75,000 Shares, for a
purchase price of $17.00 per share, or an aggregate purchase price of $1,275,000
pursuant to the Terms and Conditions for Purchase of Shares attached hereto as
Annex I and incorporated herein by reference as if fully set forth herein.
Unless otherwise requested by the Investor, certificates representing the Shares
purchased by the Investor will be registered in the Investor's name and address
as set forth below.
4. The Investor represents that, except as set forth below, (a) it has had no
position, office or other material relationship within the past three years with
the Company or persons known by it to be affiliates of the Company, (b) neither
it, nor any group of which it is a member or to which it is related,
beneficially owns (including the right to acquire or vote) any securities of the
Company and (c) it has no direct or indirect affiliation or association with any
member of the National Association of Securities Dealers, Inc. as of the date
hereof. Exceptions: None
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(If no exceptions, write "none." If left blank, response will be deemed to be
"none.")
[Remainder of Page Intentionally Left Blank. Signature Page follows.]
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Please confirm that the foregoing correctly sets forth the agreement between us
by signing in the space provided below for that purpose. By executing this
Agreement, you acknowledge that the Company may use the information in paragraph
4 above and the name and address information below in preparation of the
Registration Statement only (as defined in Annex I).
"INVESTOR"
By: /s/ XXXX XXXXXXX
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Print Name: Xxxx Xxxxxxx
Title: President of BVF Inc.
General Partner of BVF Partners L.P.
General Partner of Biotechnology Value
Fund, L.P.
Address:
AGREED AND ACCEPTED:
OSI PHARMACEUTICALS, INC.
Tax ID No.: 00-0000000
By: /s/ XXXXX XXXXXXX, Ph.D.
-------------------------
Contact name: Xxxxxxxxx Xxxxxxx
Title: President & CEO
Telephone: 000-000-0000
Name in which shares should registered (if
different):
Biotechnology Value Fund, L.P.
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ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF SHARES
1. Authorization and Sale of the Shares. Subject to the terms and
conditions of this Agreement, the Company has authorized the sale of up to
3,500,000 Shares. The Company reserves the right to increase or decrease this
number.
2. Agreement to Sell and Purchase the Shares; Subscription Date.
2.1. At the Closing (as defined in Section 3), the Company will
sell to the Investor, and the Investor will purchase from the Company, upon the
terms and conditions hereinafter set forth, the number of Shares set forth on
the signature page hereto at the purchase price set forth on such signature
page.
2.2. The Company may enter into this same form of Stock Purchase
Agreement with certain other investors (the "Other Investors") and expects to
complete sales of Shares to them. (The Investor and the Other Investors are
hereinafter sometimes collectively referred to as the "Investors," and this
Agreement and the Stock Purchase Agreements executed by the Other Investors are
hereinafter sometimes collectively referred to as the "Agreements.") The Company
may accept executed Agreements from the Investors for the purchase of Shares
commencing upon the date on which the Company provides the Investors with the
proposed purchase price per Share and concluding upon the date (the
"Subscription Date") on which the Company has (a) executed Agreements with the
Investors for the purchase of at least _______ Shares, and (b) notified the
Investors in writing that it is no longer accepting Agreements from Investors
for the purchase of Shares. The Company may not enter into any Agreements after
the Subscription Date.
3. Delivery of the Shares at Closing. The completion of the purchase
and sale of the Shares (the "Closing") shall occur on February 28, 2000 (the
"Closing Date") at the offices of the Company's counsel. At the Closing, the
Company shall deliver to the Investor one or more stock certificates
representing the number of Shares set forth on the signature page hereto, each
such certificate to be registered in the name of the Investor or, if so
indicated on the signature page hereto, in the name of a nominee designated by
the Investor.
The Company's obligation to issue the Shares to the Investor shall be
subject to the following conditions, any one or more of which may be waived by
the Company: (a) receipt by the Company of a certified or official bank check or
wire transfer of funds in the full amount of the purchase price for the Shares
being purchased hereunder as set forth on the signature page hereto; (b)
completion of the purchases and sales under the Agreements with the Other
Investors; and (c) accuracy of the representations and warranties made by the
Investors and the fulfillment of those undertakings of the Investors to be
fulfilled prior to the Closing.
The Investor's obligation to purchase the Shares shall be subject to
the following conditions, any one or more of which may be waived by the
Investor: (a) Investors shall have executed Agreements for the purchase of at
least _______ Shares, (b) the representations and warranties of the Company set
forth herein shall be true and correct as of the Closing Date in all material
respects and (c) the Investor shall have received such documents as such
Investor shall reasonably have requested, including, a standard opinion of
Company Counsel as to the matters set forth in Section 4.2 and as to
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the exemption from the registration requirements of the Securities Act of 1933,
as amended, of the sale of the Shares.
4. Representations, Warranties and Covenants of the Company. The
Company hereby represents and warrants to, and covenants with, the Investor, as
follows:
4.1. Organization. The Company is duly organized and validly
existing in good standing under the laws of the jurisdiction of its
organization. Each of the Company and its Subsidiaries (as defined in Rule 405
under the Securities Act of 1933, as amended (the "Securities Act")) has full
power and authority to own, operate and occupy its properties and to conduct its
business as presently conducted and as described in the confidential offering
memorandum, dated February 18, 2000 distributed in connection with the sale of
the Shares (including the documents incorporated by reference therein, the
"Placement Memorandum") and is registered or qualified to do business and in
good standing in each jurisdiction in which it owns or leases property or
transacts business and where the failure to be so qualified would have a
material adverse effect upon the business, financial condition, properties or
operations of the Company and its Subsidiaries, considered as one enterprise,
and no proceeding has been instituted in any such jurisdiction, revoking,
limiting or curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification.
4.2. Due Authorization and Valid Issuance. The Company has all
requisite power and authority to execute, deliver and perform its obligations
under the Agreements, and the Agreements have been duly authorized and validly
executed and delivered by the Company and constitute legal, valid and binding
agreements of the Company enforceable against the Company in accordance with
their terms, except as rights to indemnity and contribution may be limited by
state or federal securities laws or the public policy underlying such laws,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). The Shares being purchased by the Investor
hereunder will, upon issuance pursuant to the terms hereof, be duly authorized,
validly issued, fully paid and nonassessable.
4.3. Non-Contravention. The execution and delivery of the
Agreements, the issuance and sale of the Shares to be sold by the Company under
the Agreements, the fulfillment of the terms of the Agreements and the
consummation of the transactions contemplated thereby will not (a) conflict with
or constitute a violation of, or default (with the passage of time or otherwise)
under, (i) any material bond, debenture, note or other evidence of indebtedness,
lease, contract, indenture, mortgage, deed of trust, loan agreement, joint
venture or other agreement or instrument to which the Company or any Subsidiary
is a party or by which it or any of its Subsidiaries or their respective
properties are bound, (ii) the charter, by-laws or other organizational
documents of the Company or any Subsidiary, or (iii) any law, administrative
regulation, ordinance or order of any court or governmental agency, arbitration
panel or authority applicable to the Company or any Subsidiary or their
respective properties, or (b) result in the creation or imposition of any lien,
encumbrance, claim, security interest or restriction whatsoever upon any of the
material properties or assets of the Company or any Subsidiary or an
acceleration of indebtedness pursuant to any obligation, agreement or condition
contained in any material bond, debenture, note or any other evidence of
indebtedness or any material indenture, mortgage, deed of trust or any other
agreement or instrument to which the Company or any Subsidiary is a party or by
which any of them is bound or to which any of the property or assets of the
Company or any Subsidiary is subject. No consent, approval, authorization or
other order of, or registration, qualification or filing with, any regulatory
body, administrative agency, or other
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governmental body in the United States or any other person is required for the
execution and delivery of the Agreements and the valid issuance and sale of the
Shares to be sold pursuant to the Agreements, other than such as have been made
or obtained, and except for any securities filings or notifications required to
be made after the Closing under federal or state securities laws.
4.4. Capitalization. The capitalization of the Company as of
December 31, 1999 is as set forth in the Placement Memorandum (excluding
unvested options and treasury shares). The Company has not issued any capital
stock since that date other than pursuant to (a) employee benefit plans
disclosed in the Placement Memorandum, or (b) outstanding warrants or options
disclosed in the Placement Memorandum. The Shares to be sold pursuant to the
Agreements have been duly authorized, and when issued and paid for in accordance
with the terms of the Agreements will be duly and validly issued, fully paid and
nonassessable. The outstanding shares of capital stock of the Company have been
duly and validly issued and are fully paid and nonassessable, have been issued
in compliance with all federal and state securities laws, and were not issued in
violation of any preemptive rights or similar rights to subscribe for or
purchase securities. Except as set forth in or contemplated by the Placement
Memorandum, there are no outstanding rights (including, without limitation,
preemptive rights), warrants or options to acquire, or instruments convertible
into or exchangeable for, any unissued shares of capital stock or other equity
interest in the Company or any Subsidiary, or any contract, commitment,
agreement, understanding or arrangement of any kind to which the Company is a
party or of which the Company has knowledge and relating to the issuance or sale
of any capital stock of the Company or any Subsidiary, any such convertible or
exchangeable securities or any such rights, warrants or options. Without
limiting the foregoing, no preemptive right, co-sale right, right of first
refusal, registration right, or other similar right exists with respect to the
Shares or the issuance and sale thereof. No further approval or authorization of
any stockholder, the Board of Directors of the Company or others is required for
the issuance and sale of the Shares. The Company owns the entire equity interest
in each of its Subsidiaries, free and clear of any pledge, lien, security
interest, encumbrance, claim or equitable interest, other than as described in
the Placement Memorandum. Except as disclosed in the Placement Memorandum, there
are no stockholders agreements, voting agreements or other similar agreements
with respect to the Common Stock to which the Company is a party or, to the
knowledge of the Company, between or among any of the Company's stockholders.
4.5. Legal Proceedings. There is no material legal or governmental
proceeding pending or, to the knowledge of the Company, threatened to which the
Company or any Subsidiary is or may be a party or of which the business or
property of the Company or any Subsidiary is subject that is not disclosed in
the Placement Memorandum.
4.6. No Violations. Neither the Company nor any Subsidiary is in
violation of its charter, by-laws or other organizational document, or in
violation of any law, administrative regulation, ordinance or order of any court
or governmental agency, arbitration panel or authority applicable to the Company
or any Subsidiary, which violation, individually or in the aggregate, would be
reasonably likely to have a material adverse effect on the business or financial
condition of the Company and its Subsidiaries, considered as one enterprise, or
is in default (and there exists no condition which, with the passage of time or
otherwise, would constitute a default) in any material respect in the
performance of any bond, debenture, note or any other evidence of indebtedness
in any indenture, mortgage, deed of trust or any other material agreement or
instrument to which the Company or any Subsidiary is a party or by which the
Company or any Subsidiary is bound or by which the properties of the Company or
any Subsidiary are bound, which would be reasonably likely to
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have a material adverse effect upon the business or financial condition of the
Company and its Subsidiaries, considered as one enterprise.
4.7. Governmental Permits, Etc. With the exception of the matters
which are dealt with separately in Section 4.1, 4.12, 4.13, and 4.14, each of
the Company and its Subsidiaries has all necessary franchises, licenses,
certificates and other authorizations from any foreign, federal, state or local
government or governmental agency, department, or body that are currently
necessary for the operation of the business of the Company and its Subsidiaries
as currently conducted and as described in the Placement Memorandum except where
the failure to currently possess could not reasonably be expected to have a
material adverse effect.
4.8. Intellectual Property. Subject to the matters discussed under
"Risk Factors" in the Placement Memorandum, (a) each of the Company and its
Subsidiaries owns or possesses sufficient rights to use all material patents,
patent rights, trademarks, copyrights, licenses, inventions, trade secrets,
trade names and know-how (collectively, "Intellectual Property") described or
referred to in the Placement Memorandum as owned or possessed by it or that are
necessary for the conduct of its business as now conducted or as proposed to be
conducted as described in the Placement Memorandum except where the failure to
currently own or possess would not have a material adverse effect on the
condition (financial or otherwise), earnings, operations, business or business
prospects of the Company and its Subsidiaries considered as one enterprise, (b)
neither the Company nor any of its Subsidiaries has received any notice of, or
has any knowledge of, any infringement of asserted rights of a third party with
respect to any Intellectual Property that, individually or in the aggregate,
would have a material adverse effect on the financial condition or business of
the Company and its Subsidiaries considered as one enterprise, and (c) neither
the Company nor any of its Subsidiaries has received any notice of any
infringement of rights of a third party with respect to any Intellectual
Property that, individually or in the aggregate, would have a material adverse
effect upon the business or financial condition of the Company and its
Subsidiaries, considered as one enterprise.
4.9. Financial Statements. The financial statements of the Company
and the related notes contained in the Placement Memorandum present fairly, in
accordance with generally accepted accounting principles, the financial position
of the Company and its Subsidiaries as of the dates indicated, and the results
of its operations and cash flows for the periods therein specified. Such
financial statements (including the related notes) have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods therein specified, except as disclosed in the
Placement Memorandum. The other financial information contained in the Placement
Memorandum has been prepared on a basis consistent with the financial statements
of the Company.
4.10. No Material Adverse Change. Except as disclosed in the
Placement Memorandum, since December 31, 1999, there has not been (a) any
material adverse change in the financial condition or earnings of the Company
and its Subsidiaries considered as one enterprise nor has any material adverse
event occurred to the Company or its Subsidiaries, (b) any material adverse
event affecting the Company, (c) any obligation, direct or contingent, that is
material to the Company and its Subsidiaries considered as one enterprise,
incurred by the Company, except obligations incurred in the ordinary course of
business, (d) any dividend or distribution of any kind declared, paid or made on
the capital stock of the Company or any of its Subsidiaries, or (e) any loss or
damage (whether or not insured) to the physical property of the Company or any
of its Subsidiaries which has been sustained which has a material adverse effect
on the condition (financial or otherwise), earnings,
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operations, business or business prospects of the Company and its Subsidiaries
considered as one enterprise.
4.11. Disclosure. The information contained in the Placement
Memorandum as of the date hereof and as of the Closing Date, did not and shall
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
4.12. Nasdaq Compliance. The Company's Common Stock is registered
pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and is listed on The Nasdaq Stock Market, Inc. National
Market (the "Nasdaq National Market"), and the Company has taken no action
designed to, or likely to have the effect of, terminating the registration of
the Common Stock under the Exchange Act or de-listing the Common Stock from the
Nasdaq National Market, nor has the Company received any notification that the
Securities and Exchange Commission (the "SEC") or the National Association of
Securities Dealers, Inc. ("NASD") is contemplating terminating such registration
or listing.
4.13. Reporting Status. The Company has filed in a timely manner
all documents that the Company was required to file under the Exchange Act
during the 12 months preceding the date of this Agreement. The following
documents complied in all material respects with the SEC's requirements as of
their respective filing dates, and the information contained therein as of the
date thereof did not contain an untrue statement of a material fact, or omit to
state a material fact required to be stated therein, or necessary to make the
statements therein in light of the circumstances under which they were made, not
misleading:
(a) The Company's Annual Report on Form 10-K for the year
ended September 30, 1999, filed with the SEC on December 29, 1999 (as amended on
January 25, 2000) (the "10-K");
(b) The Company's Definitive Proxy Statement filed with the
SEC on January 28, 2000 in connection with the 2000 Annual Meeting of
Stockholders;
(c) The Company's Quarterly Reports on Form 10-Q filed with
the SEC on May 17, 1999, August 16, 1999 (as amended on October 15, 1999) and
February 14; 2000;
(d) The Company's Current Reports on Form 8-K filed with the
SEC on February 18, 1999, June 28, 1999, and December 15, 1999; and
(e) All other documents, if any, filed by the Company with
the SEC since September 30, 1999 pursuant to the reporting requirements of the
Exchange Act.
4.14. Listing. The Company shall comply with all requirements of
the NASD with respect to the issuance of the Shares and the listing thereof on
the Nasdaq National Market.
4.15. No Manipulation of Stock. The Company has not taken and will
not, in violation of applicable law, take, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the Shares.
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4.16. Accountants. KPMG LLP, who has expressed their opinion with
respect to the financial statements contained in the Company's 10-K, to be
incorporated by reference in the Registration Statement (as defined in Section
7.1(a)), are independent accountants as required by the Securities Act and the
rules and regulations promulgated thereunder.
4.17. Contracts. The contracts described in the documents
referenced in Section 4.13(a)-(e) (the "SEC Documents"), or incorporated by
reference therein, that are material to the Company are in full force and effect
on the date hereof, and neither the Company nor, to the Company's knowledge, any
other party to such contracts is in breach of or default under any of such
contracts which would have a material adverse effect on the business, assets or
financial condition of the Company.
4.18. Taxes. The Company has filed all necessary federal, state
and foreign income and franchise tax returns and has paid or accrued all taxes
shown as due thereon, and the Company has no knowledge of a tax deficiency which
has been or might be asserted or threatened against it which would have a
material adverse effect on the business, assets or financial condition of the
Company.
4.19. Transfer Taxes. On the Closing Date, all stock transfer or
other taxes (other than income taxes) which are required to be paid in
connection with the sale and transfer of the Shares to be sold to the Investor
hereunder will be, or will have been, fully paid or provided for by the Company
and all laws imposing such taxes will be or will have been fully complied with.
4.20. Investment Company. The Company is not an "investment
company" or an "affiliated person" of, or "promoter" or "principal underwriter"
for an investment company, within the meaning of the Investment Company Act of
1940, as amended.
4.21. Insurance. The Company maintains and will continue to
maintain insurance of the types and in the amounts that the Company reasonably
believes is adequate for its business, including, but not limited to, insurance
covering all real and personal property owned or leased by the Company against
theft, damage, destruction, acts of vandalism and all other risks customarily
insured against by similarly situated companies, all of which insurance is in
full force and effect.
4.22. Offering Materials. Other than the SEC Documents and the
Placement Memorandum, the Company has not distributed and will not distribute
prior to the Closing Date any offering material in connection with the offer and
sale of the Shares. The Company has not in the past nor will it hereafter take
any action independent of the Placement Agent to sell, offer for sale or solicit
offers to buy any securities of the Company which would bring the offer,
issuance or sale of the Shares, as contemplated by this Agreement, within the
provisions of Section 5 of the Securities Act, unless such offer, issuance or
sale was or shall be exempt from the provisions of Section 5 of the Securities
Act.
5. Representations, Warranties and Covenants of the Investor.
5.1. The Investor represents and warrants to, and covenants with,
the Company that: (a) the Investor is an "accredited investor" as defined in
Regulation D under the Securities Act and the Investor is also knowledgeable,
sophisticated and experienced in making, and is qualified to make decisions with
respect to investments in shares presenting an investment decision like that
involved in the purchase of the Shares, including investments in securities
issued by the Company and investments in comparable companies, and has
requested, received, reviewed and considered all information it deemed relevant
in making an informed decision to purchase the Shares; (b) the Investor
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is acquiring the number of Shares set forth on the signature page hereto in the
ordinary course of its business and for its own account for investment only and
with no present intention of distributing any of such Shares or any arrangement
or understanding with any other persons regarding the distribution of such
Shares; (c) the Investor will not, directly or indirectly, offer, sell, pledge,
transfer or otherwise dispose of (or solicit any offers to buy, purchase or
otherwise acquire or take a pledge of) any of the Shares except in compliance
with the Securities Act, applicable state securities laws and the respective
rules and regulations promulgated thereunder; (d) the Investor has answered all
questions on the signature page hereto for use in preparation of the
Registration Statement (as defined herein) and the answers thereto are true and
correct as of the date hereof and will be true and correct as of the Closing
Date; (e) the Investor will notify the Company immediately of any change in any
of such information until such time as the Investor has sold all of its Shares
or until the Company is no longer required to keep the Registration Statement
effective; and (f) the Investor has, in connection with its decision to purchase
the number of Shares set forth on the signature page hereto, relied only upon
the Placement Memorandum and the representations and warranties of the Company
contained herein. Investor understands that its acquisition of the Shares has
not been registered under the Securities Act or registered or qualified under
any state securities law in reliance on specific exemptions therefrom, which
exemptions may depend upon, among other things, the bona fide nature of the
Investor's investment intent as expressed herein. Investor has completed or
caused to be completed and delivered to the Company the Investor Questionnaire
attached to the Placement Memorandum, which questionnaire is true and correct in
all material respects.
5.2. The Investor acknowledges, represents and agrees that no
action has been or will be taken in any jurisdiction outside the United States
by the Company that would permit an offering of the Shares, or possession or
distribution of offering materials in connection with the issuance of the
Shares, in any jurisdiction outside the United States where legal action by the
Company for that purpose is required. Each Investor outside the United States
will comply with all applicable laws and regulations in each foreign
jurisdiction in which it purchases, offers, sells or delivers Shares or has in
its possession or distributes any offering material, in all cases at its own
expense.
5.3. The Investor hereby covenants with the Company not to make
any sale of the Shares without complying with the provisions of this Agreement,
including Section 7.2 hereof, and without effectively causing the prospectus
delivery requirement under the Securities Act to be satisfied, and the Investor
acknowledges that the certificates evidencing the Shares will be imprinted with
a legend that prohibits their transfer except in accordance therewith. The
Investor acknowledges that there may occasionally be times when the Company
determines that it must suspend the use of the Prospectus forming a part of the
Registration Statement, as set forth in Section 7.2(c).
5.4. The Investor further represents and warrants to, and
covenants with, the Company that (a) the Investor has full right, power,
authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement, and (b) this
Agreement constitutes a valid and binding obligation of the Investor enforceable
against the Investor in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the indemnification agreements of the Investors
herein may be legally unenforceable.
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5.5. The Investor will not use any of the restricted Shares
acquired pursuant to this Agreement to cover any short position in the Common
Stock of the Company if doing so would be in violation of applicable securities
laws.
5.6. The Investor understands that nothing in the Placement
Memorandum, this Agreement or any other materials presented to the Investor in
connection with the purchase and sale of the Shares constitutes legal, tax or
investment advice. The Investor has consulted such legal, tax and investment
advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Shares.
6. Survival of Representations, Warranties and Agreements.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Shares being purchased and the payment therefor.
7. Registration of the Shares; Compliance with the Securities Act.
7.1. Registration Procedures and Expenses. The Company shall:
(a) subject to receipt of necessary information from the
Investors after prompt request from the Company to the Investors to provide such
information, use its reasonable best efforts to prepare and file with the SEC,
within 10 days after the Closing Date, a registration statement (the
"Registration Statement") to enable the resale of the Shares by the Investors
from time to time through the automated quotation system of the Nasdaq National
Market or in privately-negotiated transactions;
(b) use its reasonable best efforts, subject to receipt of
necessary information from the Investors after prompt request from the Company
to the Investors to provide such information, to cause the Registration
Statement to become effective within 30 days after the Registration Statement is
filed by the Company, such reasonable best efforts to include, without limiting
the generality of the foregoing, preparing and filing with the SEC in such 30
day period any financial statements that are required to be filed prior to the
effectiveness of such Registration Statement. If either (i) the Registration
Statement shall not have been declared effective by the SEC within 120 days
following the Closing Date, or (ii) the Registration Statement, following its
effectiveness, shall not have been continuously effective for at least 45
continuous days during the period ending 165 days after the Closing Date, then
the Company shall issue to the Investor, as liquidated damages and not as a
penalty, that number of shares of Common Stock as shall equal five percent (5%)
of the total number of Shares purchased by the Investor pursuant to this
Agreement.
(c) use its reasonable best efforts to prepare and file with
the SEC such amendments and supplements to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the
Registration Statement current and effective for a period not exceeding, with
respect to each Investor's Shares purchased hereunder, the earlier of (i) the
second anniversary of the Closing Date, (ii) the date on which the Investor may
sell all Shares then held by the Investor without restriction by the volume
limitations of Rule 144(e) of the Securities Act, or (iii) such time as all
Shares purchased by such Investor in this Offering have been sold pursuant to a
registration statement.
(d) furnish to the Investor with respect to the Shares
registered under the Registration Statement such number of copies of the
Registration Statement, Prospectuses and
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Preliminary Prospectuses in conformity with the requirements of the Securities
Act and such other documents as the Investor may reasonably request, in order to
facilitate the public sale or other disposition of all or any of the Shares by
the Investor; provided, however, that the obligation of the Company to deliver
copies of Prospectuses or Preliminary Prospectuses to the Investor shall be
subject to the receipt by the Company of reasonable assurances from the Investor
that the Investor will comply with the applicable provisions of the Securities
Act and of such other securities or blue sky laws as may be applicable in
connection with any use of such Prospectuses or Preliminary Prospectuses;
(e) file documents required of the Company for normal blue
sky clearance in states specified in writing by the Investor; provided, however,
that the Company shall not be required to qualify to do business or consent to
service of process in any jurisdiction in which it is not now so qualified or
has not so consented;
(f) bear all expenses in connection with the procedures in
paragraph (a) through (e) of this Section 7.1 and the registration of the Shares
pursuant to the Registration Statement; and
(g) advise the Investors, promptly after it shall receive
notice or obtain knowledge of the issuance of any stop order by the SEC delaying
or suspending the effectiveness of the Registration Statement or of the
initiation or threat of any proceeding for that purpose; and it will promptly
use its reasonable efforts to prevent the issuance of any stop order or to
obtain its withdrawal at the earliest possible moment if such stop order should
be issued.
The Company understands that the Investor disclaims being an
underwriter, but the Investor being deemed an underwriter by the SEC shall not
relieve the Company of any obligations it has hereunder; provided, however that
if the Company receives notification from the SEC that the Investor is deemed an
underwriter, then the period by which the Company is obligated to submit an
acceleration request to the SEC shall be extended to the earlier of (i) the 90th
day after such SEC notification, or (ii) 120 days after the initial filing of
the Registration Statement with the SEC.
7.2. Transfer of Shares After Registration; Suspension.
(a) The Investor agrees that it will not effect any
disposition of the Shares or its right to purchase the Shares that would
constitute a sale within the meaning of the Securities Act except as
contemplated in the Registration Statement referred to in Section 7.1 and as
described below or as otherwise permitted by law, and that it will promptly
notify the Company of any changes in the information set forth in the
Registration Statement regarding the Investor or its plan of distribution.
(b) Except in the event that paragraph (c) below applies, the
Company shall (i) if deemed necessary by the Company, prepare and file from time
to time with the SEC a post-effective amendment to the Registration Statement or
a supplement to the related Prospectus or a supplement or amendment to any
document incorporated therein by reference or file any other required document
so that such Registration Statement will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and so that, as
thereafter delivered to purchasers of the Shares being sold thereunder, such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; (ii) provide the Investor copies of any documents filed pursuant
to Section 7.2(b)(i); and (iii) inform each Investor that the Company has
complied with its obligations in Section 7.2(b)(i) (or that, if the Company has
filed a post-effective amendment to the
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Registration Statement which has not yet been declared effective, the Company
will notify the Investor to that effect, will use its reasonable efforts to
secure the effectiveness of such post-effective amendment as promptly as
possible and will promptly notify the Investor pursuant to Section 7.2(b)(i)
hereof when the amendment has become effective).
(c) Subject to paragraph (d) below, in the event (i) of any
request by the SEC or any other federal or state governmental authority during
the period of effectiveness of the Registration Statement for amendments or
supplements to a Registration Statement or related Prospectus or for additional
information; (ii) of the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose;
(iii) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Shares for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; or (iv) of any event or circumstance which, upon
the advice of its counsel, necessitates the making of any changes in the
Registration Statement or Prospectus, or any document incorporated or deemed to
be incorporated therein by reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; then the Company shall deliver a certificate in
writing to the Investor (the "Suspension Notice") to the effect of the foregoing
and, upon receipt of such Suspension Notice, the Investor will refrain from
selling any Shares pursuant to the Registration Statement (a "Suspension") until
the Investor's receipt of copies of a supplemented or amended Prospectus
prepared and filed by the Company, or until it is advised in writing by the
Company that the current Prospectus may be used, and has received copies of any
additional or supplemental filings that are incorporated or deemed incorporated
by reference in any such Prospectus. In the event of any Suspension, the Company
will use its reasonable efforts to cause the use of the Prospectus so suspended
to be resumed as soon as reasonably practicable within 20 business days after
the delivery of a Suspension Notice to the Investor. In addition to and without
limiting any other remedies (including, without limitation, at law or at equity)
available to the Investor, the Investor shall be entitled to specific
performance in the event that the Company fails to comply with the provisions of
this Section 7.2(c).
(d) Notwithstanding the foregoing paragraphs of this Section
7.2, the Investor shall not be prohibited from selling Shares under the
Registration Statement as a result of Suspensions on more than two occasions of
not more than 30 days each in any 12 month period, unless, in the good faith
judgment of the Company's Board of Directors, upon advice of counsel, the sale
of Shares under the Registration Statement in reliance on this Section 7.2(d)
would be reasonably likely to cause a violation of the Securities Act or the
Exchange Act and result in liability to the Company.
(e) Provided that a Suspension is not then in effect, the
Investor may sell Shares under the Registration Statement; provided, however,
that it arranges for delivery of a current Prospectus to the transferee of such
Shares. Upon receipt of a request therefor, the Company has agreed to provide an
adequate number of current Prospectuses to the Investor and to supply copies to
any other parties requiring such Prospectuses.
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(f) In the event of a sale of Shares by the Investor pursuant
to the Registration Statement, the Investor must also deliver to the Company's
transfer agent, with a copy to the Company, a Certificate of Subsequent Sale
substantially in the form attached hereto, so that the Shares may be properly
transferred.
7.3. Indemnification.
(a) For the purpose of this Section 7.3:
(i) the term "Selling Stockholder" shall include the
Investor and any officer, director, trustee or affiliate of such Investor;
(ii) the term "Registration Statement" shall include any
final Prospectus, exhibit, supplement or amendment included in or relating to
the Registration Statement referred to in Section 7.1; and
(iii) the term "untrue statement" shall include any
untrue statement or alleged untrue statement, or any omission or alleged
omission to state in the Registration Statement a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(b) The Company agrees to indemnify and hold harmless each
Selling Stockholder from and against any losses, claims, damages or liabilities
to which such Selling Stockholder may become subject (under the Securities Act
or otherwise) insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of, or are based upon, (i) any
untrue statement of a material fact contained in the Registration Statement, or
(ii) any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will reimburse such Selling Stockholder
for any reasonable legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim, or
preparing to defend any such action, proceeding or claim; provided, however,
that the Company shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based upon, an untrue
statement made in such Registration Statement in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such
Selling Stockholder specifically for use in preparation of the Registration
Statement or the failure of such Selling Stockholder to comply with its
covenants and agreements contained in Section 7.2 hereof respecting the sale of
the Shares or any statement or omission in any Prospectus that is corrected in
any subsequent Prospectus that was delivered to the Investor prior to the
pertinent sale or sales by the Investor. The Company shall reimburse each
Selling Stockholder for the amounts provided for herein on demand as such
expenses are incurred.
(c) The Investor agrees to indemnify and hold harmless the
Company (and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act, each officer of the Company who signs the
Registration Statement and each director of the Company) from and against any
losses, claims, damages or liabilities to which the Company (or any such
officer, director or controlling person) may become subject (under the
Securities Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, (i) any failure to comply with the covenants and agreements
contained in Section 7.2 hereof respecting the sale of the Shares, or (ii) any
untrue statement of a material fact contained in the Registration Statement if
such untrue statement was made in reliance upon and in conformity with written
information furnished by or on behalf of the Investor specifically for use in
preparation of the
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Registration Statement, and the Investor will reimburse the Company (or such
officer, director or controlling person), as the case may be, for any legal or
other expenses reasonably incurred in investigating, defending or preparing to
defend any such action, proceeding or claim; provided, however, that the
Investor's obligation to indemnify the Company shall be limited to the net
amount received by the Investor from the sale of the Shares.
(d) Promptly after receipt by any indemnified person of a
notice of a claim or the beginning of any action in respect of which indemnity
is to be sought against an indemnifying person pursuant to this Section 7.3,
such indemnified person shall notify the indemnifying person in writing of such
claim or of the commencement of such action, but the omission to so notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party under this Section 7.3 (except to the extent that such
omission materially and adversely affects the indemnifying party's ability to
defend such action) or from any liability otherwise than under this Section 7.3.
Subject to the provisions hereinafter stated, in case any such action shall be
brought against an indemnified person, the indemnifying person shall be entitled
to participate therein, and, to the extent that it shall elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid notice
from such indemnified party, shall be entitled to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified person. After notice
from the indemnifying person to such indemnified person of its election to
assume the defense thereof, such indemnifying person shall not be liable to such
indemnified person for any legal expenses subsequently incurred by such
indemnified person in connection with the defense thereof; provided, however,
that if there exists or shall exist a conflict of interest that would make it
inappropriate, in the opinion of counsel to the indemnified person, for the same
counsel to represent both the indemnified person and such indemnifying person or
any affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person; provided,
however, that no indemnifying person shall be responsible for the fees and
expenses of more than one separate counsel (together with appropriate local
counsel) for all indemnified parties. In no event shall any indemnifying person
be liable in respect of any amounts paid in settlement of any action unless the
indemnifying person shall have approved the terms of such settlement; provided,
however, that such consent shall not be unreasonably withheld. No indemnifying
person shall, without the prior written consent of the indemnified person,
effect any settlement of any pending or threatened proceeding in respect of
which any indemnified person is or could have been a party and indemnification
could have been sought hereunder by such indemnified person, unless such
settlement includes an unconditional release of such indemnified person from all
liability on claims that are the subject matter of such proceeding.
(e) If the indemnification provided for in this Section 7.3
is unavailable to or insufficient to hold harmless an indemnified party under
paragraph (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Investor,
as well as any other Selling Stockholders under such registration statement on
the other in connection with the statements or omissions or other matters which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
fault shall be determined by reference to, among other things, in the case of an
untrue statement, whether the untrue statement relates to information supplied
by the Company on the one hand or an Investor or other Selling Stockholder on
the other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement. The
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Company and the Investor agree that it would not be just and equitable if
contribution pursuant to this paragraph (e) were determined by pro rata
allocation (even if the Investor and other Selling Stockholders were treated as
one entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to above in this
paragraph (e). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this paragraph (e) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this paragraph (e), no Investor shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Investor from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Investor has otherwise been required to pay by
reason of such untrue statement. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Investor's obligations in this paragraph (e)
to contribute are several in proportion to its sale of Shares to which such loss
relates and not joint with any other Selling Stockholders.
(f) The parties to this Agreement hereby acknowledge that
they are sophisticated business persons who were represented by counsel during
the negotiations regarding the provisions hereof including, without limitation,
the provisions of this Section 7.3, and are fully informed regarding said
provisions. They further acknowledge that the provisions of this Section 7.3
fairly allocate the risks in light of the ability of the parties to investigate
the Company and its business in order to assure that adequate disclosure is made
in the Registration Statement as required by the Securities Act and the Exchange
Act. The parties are advised that federal or state public policy as interpreted
by the courts in certain jurisdictions may be contrary to certain of the
provisions of this Section 7.3, and the parties hereto hereby expressly waive
and relinquish any right or ability to assert such public policy as a defense to
a claim under this Section 7.3 and further agree not to attempt to assert any
such defense.
7.4. Termination of Conditions and Obligations. The conditions
precedent imposed by Section 5 or this Section 7 upon the transferability of the
Shares shall cease and terminate as to any particular number of the Shares when
such Shares shall have been effectively registered under the Securities Act and
sold or otherwise disposed of in accordance with the intended method of
disposition set forth in the Registration Statement covering such Shares or at
such time as an opinion of counsel satisfactory to the Company shall have been
rendered to the effect that such conditions are not necessary in order to comply
with the Securities Act.
7.5. Information Available. So long as the Registration Statement
is effective covering the resale of Shares owned by the Investor, the Company
will furnish to the Investor:
(a) as soon as practicable, one copy of (i) its Annual Report
to Stockholders (which Annual Report shall contain financial statements audited
in accordance with generally accepted accounting principles by a national firm
of certified public accountants), (ii) its Annual Report on Form 10-K and (iii)
its Quarterly Reports on Form 10-Q (the foregoing, in each case, excluding
exhibits);
(b) upon the request of the Investor, all exhibits excluded
by the parenthetical to paragraph (a) of this Section 7.5 as filed with the SEC
and all other information that is made available to stockholders; and
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(c) upon the reasonable request of the Investor, an adequate
number of copies of the Prospectuses to supply to any other party requiring such
Prospectuses; and the Company, upon the reasonable request of the Investor, will
meet with the Investor or a representative thereof at the Company's headquarters
to discuss all information relevant for disclosure in the Registration Statement
covering the Shares and will otherwise cooperate with any Investor conducting an
investigation for the purpose of reducing or eliminating such Investor's
exposure to liability under the Securities Act, including the reasonable
production of information at the Company's headquarters; provided, that the
Company shall not be required to disclose any confidential information to or
meet at its headquarters with any Investor until and unless the Investor shall
have entered into a confidentiality agreement in form and substance reasonably
satisfactory to the Company with the Company with respect thereto.
7.6. The Company shall not issue any public statement, press
release or any other public disclosure listing the Investor as one of the
purchasers of the Shares without the Investor's prior written consent, except
(i) the Registration Statement, (ii) the filing of this Agreement, with the name
of the Investor listed on the signature page hereof, as an exhibit to the
Company's periodic reports under the Exchange Act and (iii) as such public
statement, press release or other public disclosure may be required by
applicable law, in which case the Company shall allow Investor at least one
business day to comment on such public statement, press release or other public
disclosure in advance of such issuance.
8. Notices. All notices, requests, consents and other communications
hereunder shall be in writing, shall be mailed (a) if within domestic United
States by first-class registered or certified airmail, or nationally recognized
overnight express courier, postage prepaid, or by facsimile, or (b) if delivered
from outside the United States, by International Federal Express or facsimile,
and shall be deemed given (i) if delivered by first-class registered or
certified mail domestic, three business days after so mailed, (ii) if delivered
by nationally recognized overnight carrier, one business day after so mailed,
(iii) if delivered by International Federal Express, two business days after so
mailed, or (iv) if delivered by facsimile, upon electronic confirmation of
receipt and shall be delivered as addressed as follows:
(a) if to the Company, to:
Xxxxxx X. Xxx Xxxxxxxx
Vice President and Chief Financial Officer
OSI Pharmaceuticals, Inc.
000 Xxxxxxx Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Phone: (000) 000-0000, ext. 273
Telecopy: (000) 000-0000
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(b) with a copy to:
Saul, Ewing, Xxxxxx & Xxxx LLP
Centre Square West
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Xx., Esquire
Phone: (000) 000-0000
Telecopy: (000) 000-0000
(c) if to the Investor, at its address on the signature
page hereto, or at such other address or addresses as
may have been furnished to the Company in writing.
9. Changes. This Agreement may not be modified or amended except
pursuant to an instrument in writing signed by the Company and the Investor.
10. Headings. The headings of the various sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed to
be part of this Agreement.
11. Severability. In case any provision contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
12. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of Delaware, without giving
effect to the principles of conflicts of law.
13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.
14. Rule 144. The Company covenants that it will file the reports
required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations adopted by the SEC thereunder (or, if the Company is not
required to file such reports, it will, upon the request of any Investor holding
Shares purchased hereunder made after the first anniversary of the Closing Date,
make publicly available such information as necessary to permit sales pursuant
to Rule 144 under the Securities Act), and it will take such further action as
any such Investor may reasonably request, all to the extent required from time
to time to enable such Investor to sell Shares purchased hereunder without
registration under the Securities Act within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or (b) any similar rule or regulation hereafter adopted by
the SEC. Upon the request of any such Investor, the Company will deliver to such
holder a written statement as to whether it has complied with such information
and requirements.
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