Exhibit 4.4
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is made as of July 17,
1996, between Xxxxxxx Pharmaceutical Corporation, a New Jersey corporation, (the
"Corporation"), and an entity advised by Dimensional Fund Advisors Inc. whose
name is set forth at the foot of this Agreement (the "Purchaser").
The Corporation and the Purchaser hereby agree as follows:
SECTION I.
Authorization, Purchase and Sale of the Stock
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1. Authorization of the Stock. The Corporation has authorized issuance
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and sale of _______ shares of its common stock (the "Stock") to Purchaser as
herein provided.
2. Sale and Purchase of the Stock. At the Closing, subject to the terms
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and conditions hereof and in reliance upon the representations, warranties and
agreements contained herein, the Purchaser will purchase the Stock from the
Corporation at a purchase price of $16.65 per share, $____________ in total.
SECTION II.
Closing, Payment and Delivery
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1. Closing Date and Place of Closing. The closing shall be held as soon
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as practicable, and in no event more than 10 business days after execution of
this Agreement, on such date as the Corporation and the Purchaser may agree to
(the "Closing Date") and shall be held at the offices of Dimensional Fund
Advisors Inc., 0000 Xxxxx Xxxxxx, Xxxxx Xxxxxx, XX 00000.
2. Payment and Delivery. At the Closing, the Purchaser will pay or cause
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to be paid to the Corporation by wire funds transfer the entire purchase
price. The Corporation will deliver in advance of the Closing to an
institutional custodian designated by the Purchaser a certificate or
certificates, registered in
such name or names as Purchaser may designate, representing all of the Stock,
with instructions that such certificates are to be held for the account of
Purchaser upon payment of the purchase price.
3. Covenant of Best Efforts and Good Faith. The Corporation and the
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Purchaser agree to use their respective best efforts and to act in good faith to
cause to occur all conditions to Closing which are in their respective control.
SECTION III.
Purchase Price Adjustment
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3.1. Subsequent Sale at Lower Price. If during the six month period
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following the Closing Date, the Corporation sells any shares of its common stock
for a selling price lower than the purchase price per share set forth in Section
1.2 hereof, the purchase price per share of the Stock sold to Purchaser
hereunder shall be adjusted downward to equal such lower selling price. The
Corporation shall give to the Purchaser prompt written notice of any such sale.
3.2. Adjustment Mechanism. If an adjustment of the purchase price is
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required pursuant to this Section the Corporation shall immediately deliver to
Purchaser such number of additional shares of common stock as will cause (i) the
total number of shares of common stock delivered to Purchaser hereunder,
multiplied by (ii) the adjusted purchase price per share, to equal (iii) the
total purchase price set forth in Section 1.2 hereof; provided however, that the
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Corporation shall effect such adjustment in cash, in whole or in part, to the
extent required by the following subsection.
3.3. Limitation on Number of Shares. Purchaser and other entities
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advised by Dimensional Fund Advisors Inc. shall not be required to accept, by
way of any such adjustment, a number of shares of the Corporation such that the
total number of such shares held by Purchaser and such other entities, which
were held by them on the date of this Agreement or acquired by them pursuant to
this Agreement or agreements of like tenor with such other entities, would
exceed 4.99% of the total outstanding stock of the Corporation. The Corporation
shall effect the adjustment required by this Section by cash refund to the
extent necessary to avoid causing the aforesaid limitation to be exceeded.
3.4 Capital Adjustments. In case of any stock split or reverse stock
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split, stock dividend, reclassification of the common stock, recapitalization,
merger or consolidation, or like capital adjustment affecting the common stock
of the Corporation,
the provisions of this Section shall be applied as if such capital adjustment
event had occurred immediately prior to the Closing Date and the original
purchase price had been fairly allocated to the stock resulting from such
capital adjustment; and in other respects the provisions of this Section shall
be applied in a fair, equitable and reasonable manner so as to give effect, as
nearly as may be, to the purposes hereof.
3.5. Exclusions. Section 3.1 shall not apply to sales of shares by
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the Corporation (i) upon conversion or exercise of any convertible securities,
options or warrants outstanding on the date hereof, (ii) pursuant to the
provisions of any shareholder-approved employee benefit or incentive plan
heretofore or hereafter adopted by the Corporation, (iii) to an entity which is
a strategic investor in the Corporation or an investor which is in a related
industry, as opposed to a financial investor, (iv) to the owners of another
entity acquired by the Corporation, or (v) in the contemplated private
transactions identified in a letter from the Corporation to Xxxxxxxx & Laffer
Group, Inc., a copy of which has been delivered to the Purchaser.
3.6. Definitions. For purposes of Section 3.1 hereof, a sale of
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shares shall mean and include the sale or issuance of rights, options, warrants
or convertible securities under which the Corporation is or may become obligated
to issue shares of common stock, and the "selling price" of the common stock
covered thereby shall be the exercise or conversion price thereof plus the
consideration (if any) received by the Corporation upon such sale or issuance.
If shares are issued for a consideration other than cash, the "selling price"
shall be the fair value of the such consideration as determined in good faith by
the Board of Directors of the Corporation. The term "Stock" as used in this
Agreement shall include shares issued pursuant to this Section.
SECTION IV.
Representations and Warranties of the Corporation
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The Corporation hereby represents and warrants to the Purchaser that:
1. Corporate Power, Qualification and Standing. The Corporation and its
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subsidiaries are validly existing and in good standing under the laws of their
respective jurisdictions of incorporation and each of them is qualified to
transact business in each jurisdiction in which its ownership of property or
conduct of activities requires such qualification. The Corporation has all
requisite corporate power and authority to enter into this Agreement, to sell
the Stock and to carry out and perform its other obligations under this
Agreement.
2. S.E.C. Reports; Financial Statements. The common stock of the
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Corporation is registered under Section 12(b) or (g) of the Securities Exchange
Act of 1934 and the Corporation is in full compliance with its reporting and
filing obligations under said Act. The Corporation has delivered to Purchaser
its Annual Reports to shareholders and its reports on Form 10K for its last
three fiscal years, and all its quarterly reports to shareholders, quarterly
reports on Form 10Q, and each other report, registration statement, definitive
proxy statement or other document filed with the S.E.C. since the beginning of
said three fiscal years (collectively, the "SEC Reports"). The SEC Reports do
not (as of their respective dates) contain any 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 the light of the circumstances under which
they were made, not misleading. The audited and unaudited financial statements
of the Corporation included in the SEC Reports (the "Financial Statements") have
been prepared in accordance with generally accepted accounting principles
applied on a consistent basis (except as stated in such Financial Statements or
the notes thereto) and fairly present the financial position of the Corporation
and its consolidated subsidiaries as of the dates thereof and the results of
their operations and changes in financial position for the periods then ended.
Except as publicly disclosed by the Corporation in the SEC Reports or otherwise,
since the end of the most recent of said fiscal years there has been no material
adverse change in the business, financial condition, or results of operations of
the Corporation and its subsidiaries taken together, and there is no existing
condition, event or series of events which can reasonably be expected to have a
material adverse effect on the business, financial condition or results of
operations of the Corporation and its subsidiaries taken together, or its
ability to perform its obligations under this Agreement.
3. Authorization; No Conflict. Execution and delivery of this Agreement
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and issuance and sale of the Stock have been duly authorized by all necessary
corporate action of the Corporation, and the Stock when issued will be validly
issued, fully paid and non-assessable. Performance by the Corporation of its
obligations under this Agreement will not conflict with or violate (i) the
charter documents or bylaws of the Corporation, (ii) any indenture, loan
agreement, lease, mortgage or other material agreement binding on the
Corporation, (iii) any order of a court or administrative agency binding on the
Corporation, or (iv) any applicable law or governmental
regulation; and such performance does not and will not require the permission or
approval of any governmental agency, and will not result in the imposition or
creation of any lien or charge against any assets of the Corporation. Except as
disclosed in the Financial Statements, the SEC Reports and the attachments to
the letter described in Section 3.5(v) hereof, (i) the Corporation has no
obligation to redeem or repurchase any of its equity securities, (ii) except for
the pre-emptive rights granted to Yamanouchi Pharmaceutical Corporation, Ltd.
("Yamanouchi") pursuant to the Stock Purchase Agreement dated January 22, 1992
between the Company and Yamanouchi (the "Yamanouchi Agreement") no shareholder
or other person has pre-emptive or other rights to acquire equity securities of
the Corporation, and (iii) the Corporation has no obligation to register any of
its securities otherwise than pursuant to Section 8 of this Agreement or as
disclosed on Exhibit A hereto.
4. Material Agreements; No Defaults. All material indentures, loan
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agreements, leases, mortgages and other agreements binding on the Corporation or
its subsidiaries are identified in the list of exhibits contained in the
Corporation's most recent 10K report ("Other Agreements"). No material default
on the part of the Corporation or any of its subsidiaries (including any event
which, with notice or the passage of time, would constitute a default) exists
under any of the Other Agreements.
5. Material Liabilities. Except for liabilities disclosed in the
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Financial Statements or the SEC Reports, and obligations under the Other
Agreements, the Corporation and its subsidiaries have no material liabilities or
obligations, absolute or contingent, other than liabilities arising in the
ordinary course of business subsequent to the date of the most recent of the
Financial Statements.
6. Properties. The Corporation and its subsidiaries (i) have good title
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to the properties and assets reflected in the Financial Statements as owned by
them, (ii) have valid leasehold interests in the properties leased by them, and
(iii) own or have the right to use under valid license agreements all
trademarks, trade names, copyrights, patents and other intellectual property
rights regularly utilized by them; subject in each case to no material liens,
security interests or adverse claims except as disclosed in the Financial
Statements.
7. Litigation. There are no material legal actions, arbitrations,
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or administrative proceedings pending against the Corporation or its
subsidiaries, except for the matters disclosed in the SEC Reports.
8. Tax Matters. The Corporation and its subsidiaries have filed on a
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timely basis all tax returns required to be filed by them and have paid their
taxes prior to delinquency, and have made adequate accruals for tax liabilities
on the Financial Statements in accordance with generally accepted accounting
principles.
9. ERISA Compliance. Neither the Corporation nor any of its subsidiaries
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has incurred any material funding deficiency within the meaning of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or any material
liability to the Pension Benefit Guarantee Corporation in connection with any
employee benefit plan. The Corporation and its subsidiaries are in compliance
in all material respects with all applicable provisions of ERISA, and have no
obligations with respect to any multi-employer plan. No "reportable event" as
such term is defined in ERISA, which may result in any material liability, has
occurred with respect to any employee benefit or other plan maintained for
employees of the Corporation or any subsidiary.
10. Environmental Matters. Except as disclosed in the SEC Reports,
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neither the Corporation nor any of its subsidiaries (i) has been notified by any
governmental authority that it is, or may be, a Responsible Party with respect
to cleanup or remediation of any environmental condition or hazardous waste
site, (ii) has violated any law, regulation, order or requirement of
governmental authority with respect to Hazardous Substances, or (iii) has
incurred any material liability for violation or noncompliance with applicable
Environmental Regulations. The term "Environmental Regulations" means any law,
regulation, order or requirement relating to protection of the environment,
including without limitation, the Clean Air Act, the Clean Water Act, the
Comprehensive Environmental Response, Compensation and Liability Act, the
Resource Conservation and Recovery Act, the Hazardous Materials Transportation
Act and the Toxic Substances Control Act. The term "Hazardous Substance" means
any substance defined or listed as such in any Environmental Regulation.
11. Other Matters. The Corporation is not now and will not be after
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giving effect to the receipt of the proceeds from the sale of the Stock an
"Investment
Company" within the meaning of the Investment Company Act of 1940, nor will it
be controlled by or acting on behalf of any person which is such an investment
company. The Corporation is not selling the Stock "for the purpose of
purchasing or carrying any margin stock" within the meaning of Regulation G of
the Board of Governors of the Federal Reserve System. The Corporation has not
offered the Stock to any person other than the Purchaser or certain accredited
investors who may become purchasers of Common Stock of the Corporation.
SECTION V.
Representations and Warranties of the Purchaser
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The Purchaser represents and warrants to the Corporation that:
1. Corporate Power and Authority. It is validly existing and in good
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standing with all requisite power and authority to enter into this Agreement and
carry out its obligations hereunder and has taken all actions necessary to
authorize it to enter into this Agreement and carry out such obligations.
2. Investment. It is acquiring the Stock for investment and not with the
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view to, or for resale in connection with, any distribution thereof. It is an
"accredited investor" within the meaning of the Securities Act of 1933 and the
rules thereunder. It understands that the Stock has not been registered under
the Securities Act of 1933 nor qualified under any State blue sky law by reason
of specified exemptions therefrom which depend upon, among other things, the
bona fide nature of its investment intent as expressed herein.
3. Rule 144. It acknowledges that the Stock must be held indefinitely
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unless it is subsequently registered under the Securities Act of 1933 or an
exemption from such registration is available. It has been advised or is aware
of the provisions of Rule 144 promulgated under the Securities Act.
SECTION VI.
Conditions to Obligations of the Purchaser
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The obligation of the Purchaser to purchase the Stock is subject to
the fulfillment on or prior to the Closing Date of each of the following
conditions:
(a) Representations and Warranties. The representations and warranties of the
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Corporation shall be true and correct in all material respects on the
Closing Date.
(b) Performance. All covenants, agreements and conditions contained in this
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Agreement to be performed or complied with by the Corporation on or prior
to the Closing Date shall have been performed or complied with in all
material respects.
(c) Opinion of Corporation's Counsel. The Purchaser shall have received from
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counsel to the Corporation an opinion confirming the representations set
forth in the first sentence of Section 4.3 hereof, and on the basis of such
counsel's review of the Other Agreements and certificates of officers of
the Corporation as to factual matters, confirming the representations set
forth in the second and third sentences of Section 4.3 hereof.
(d) Legal Issuance. At the time of the Closing, the issuance and purchase of
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the Stock shall be legally permitted by all laws and regulations to which
the Purchaser and the Corporation are subject.
(e) Proceedings and Documents. All corporate and other proceedings in
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connection with the transactions contemplated hereby and all documents and
instruments incident to such transactions shall be satisfactory in form and
substance to the Purchaser and its counsel.
(f) Satisfaction of Obligations to Broker. The Corporation shall have
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furnished the Purchaser with assurances satisfactory to the Purchaser that
the Corporation has satisfied its obligations to any broker entitled to
compensation in connection with the sale of the Stock.
SECTION VII.
Conditions to Obligations of the Corporation
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The Corporation's obligation to sell the Stock is subject to the
fulfillment on or prior to the Closing Date of each of the following conditions:
(a) Representations and Warranties. The representations and warranties made by
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the Purchaser shall be true and correct in all material respects on the
Closing Date.
(b) Legal Issuance. At the time of the Closing, the issuance and purchase of
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the Stock shall be legally permitted by all laws and regulations to which
the Purchaser and the Corporation are subject.
(c) Payment. The Corporation shall concurrently receive payment for the Stock
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as provided in Section 2.
SECTION VIII.
Covenant to Register
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(a) For purposes of this Section 8, the following definitions shall
apply:
(i) The terms "register", "registered", and "registration" refer to a
registration under the Securities Act of 1933, as amended (the "Act") effected
by preparing and filing a registration statement or similar document in
compliance with the Act or an amendment thereto, and the declaration or ordering
of effectiveness of such registration statement, document or amendment thereto.
(ii) The term "Registrable Securities" means the Stock and any
securities of the Corporation or securities of any successor corporation issued
as, or issuable upon the conversion or exercise of any warrant, right or other
security that is issued as, a dividend or other distribution with respect to, or
in exchange for or in replacement of, the Stock.
(b) (i) The Company shall, as expeditiously as possible following the
Closing, file a registration statement on Form S-3, or if Form S-3 is not then
available, another appropriate form, covering all the Registrable Securities,
and shall use its best efforts to cause such registration statement to become
effective by the 120th calendar day after the Closing Date. In the event such
registration is not so declared effective or does not include all Registrable
Securities, from time to time thereafter, Purchaser shall have the right to
require by notice in writing that the Corporation register all or any part of
the Registrable Securities held by Purchaser (a "Demand Registration") and the
Corporation shall thereupon effect such registration in accordance herewith.
(ii) The Corporation shall not be obligated to effect Demand
Registration (i) if all of the Registrable Securities held by Purchaser which
are intended to be covered by the Demand Registration are, at the time of the
request of a Demand Registration, included in an effective registration
statement and the Corporation is in compliance with its obligations under
Subsection (d)(ii) through (v) hereof with respect to such registration
statement, or (ii) within 120 days after the effective date of any other
registration as to which Purchaser was given piggy-back rights pursuant to
subsection (c) hereof and in which Purchaser was able to register and sell at
least eighty percent (80%) of the Registrable Securities requested by Purchaser
to be included in such registration.
(iii) If the registration statement covering all Registrable
Securities is not effective by the 120th calendar day after the Closing Date,
then the Company shall pay the Purchaser in cash an amount equal to 3% of the
total Purchase Price for each 30 day period thereafter until such registration
statement is effective (pro-rata as to a period of less than 30 days).
(c) If the Corporation proposes to register (including for this
purpose a registration effected by the Corporation for shareholders other than
the Purchaser) any of its stock or other securities under the Act in connection
with a public offering of such securities (other than a registration on Form S-
4, Form S-8 or other limited purpose form) and the Registrable Securities have
not heretofore been included in a registration statement under Subsection (b),
which remains effective, the Corporation shall, at such time, promptly give the
Purchaser written notice of such registration. Upon the written request of the
Purchaser given within twenty (20) days after receipt of such notice by the
Purchaser, the Corporation shall cause to be registered under the Act all of the
Registrable Securities that the Purchaser has requested to be registered.
However, the Corporation shall have no obligation under this Subsection (c) to
the extent that, with respect to a public offering registration, any underwriter
of such public offering reasonably requests that the Registrable Securities or a
portion thereof be excluded therefrom.
(d) Whenever required under this Section 8 to effect the registration
of any Registrable Securities, the Corporation shall, as expeditiously as
reasonably possible:
(i) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best efforts to cause such
registration to become effective and, upon the request of the Purchaser, keep
such registration statement effective for so long as Purchaser desires to
dispose of the securities covered by such registration statement (but not after
Purchaser in the reasonable opinion of its counsel is free to sell such
securities under the provisions of Rule 144(k) or any amendment thereof or any
similar or successor rule under the Act).
(ii) Prepare and file with the SEC such amendments and supplements to
such registration statements and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Act with respect to the disposition of all securities covered by such
registration statement.
(iii) Furnish to the Purchaser such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the 1933 Act, and such other documents as the Purchaser may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by Purchaser.
(iv) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by Purchaser,
provided that the Corporation shall not be required in connection therewith or
as a condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
(v) Notify Purchaser of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing.
(vi) Furnish, at the request of Purchaser, an opinion of counsel of
the Corporation, dated the effective date of the registration statement, as to
the due authorization and issuance of the securities being registered
and compliance with securities laws by the Corporation in connection with the
authorization and issuance thereof.
(e) The Purchaser will furnish to the Corporation in connection with
any registration under this Section 8 such information regarding itself, the
Registrable Securities and other securities of the Corporation held by it, and
the intended method of disposition of such securities as shall be required to
effect the registration of the Registrable Securities held by Purchaser.
(f) (i) The Corporation shall indemnify, defend and hold harmless
each holder of Registrable Securities which are included in a registration
statement pursuant to the provisions of Subsections (b) or (c), any underwriter
(as defined in the Act) for such holder, and the directors, officers and
controlling persons of such holder or underwriter from and against, and shall
reimburse all of them with respect to, any and all claims, suits, demands,
causes of action, losses, damages, liabilities, costs or expenses
("Liabilities") to which any of them may become subject under the Act or
otherwise, arising from or relating to (A) any untrue statement or alleged
untrue statement of any material fact contained in such registration statement,
any prospectus contained therein or any amendment or supplement thereto, or (B)
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading; provided, however, that
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the Corporation shall not be liable in any such case to the extent that any such
Liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished by such person in writing specifically for use in the preparation
thereof.
(ii) Each holder of Registrable Securities included in a registration
pursuant to the provisions of Subsection (b) or (c) shall indemnify, defend, and
hold harmless the Corporation, its directors, officers, and controlling persons,
and shall reimburse the Corporation, its directors, officers, and controlling
persons with respect to, any and all Liabilities to which any of them may become
subject under the Act or otherwise, arising from or relating to (A) any untrue
statement or alleged untrue statement of any material fact contained in such
registration statement, any prospectus contained therein or any amendment or
supplement thereto, or (B) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading,
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was
so made in reliance upon and in strict conformity with written information
furnished by or on behalf of such holder specifically for use in the preparation
thereof.
(iii) Promptly after receipt by an indemnified party pursuant to the
provisions of Subsection (f) (i) or (f) (ii) of notice of the commencement of
any action involving the subject matter of the foregoing indemnity provisions,
such indemnified party shall, if a claim thereof is to be made against the
indemnifying party pursuant to the provisions of Subsection (f)(i) or (f)(ii),
promptly notify the indemnifying party of the commencement thereof; provided,
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however, that the failure to so notify the indemnifying party shall not relieve
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it from its indemnification obligations hereunder except to the extent that the
indemnifying party is materially prejudiced by such failure. If such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party shall have the right to
participate in, and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party; provided, however, if the
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defendants in any action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that there may
be legal defenses different from or in addition to those available to the
indemnifying party, or if there is conflict of interest which would prevent
counsel for the indemnifying party from also representing the indemnified party,
the indemnified party shall have the right to select separate counsel to
participate in the defense of such action on behalf of such indemnified party.
After notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party pursuant to Subsection (f)(i) or (f)(ii) for
any expense of counsel subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation, unless (A) the indemnified party shall have employed counsel in
accordance with the provisions of the preceding sentence, or (B) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after the notice of the commencement of the action. An indemnifying party shall
not be responsible for amounts paid in settlement without its consent, provided
that its consent may not be unreasonably withheld.
(g) (i) With respect to the inclusion of Registrable Securities in a
registration statement pursuant to subsections (b) or (c), all fees, costs and
expenses of and incidental to such registration, inclusion and public
offering shall be borne by the Corporation; provided, however, that any
securityholders participating in such registration shall bear their pro rata
share of the underwriting discounts and commissions, if any.
(ii) The fees, costs and expenses of registration to be borne by the
Corporation as provided in this Subsection (g) shall include, without
limitation, all registration, filing and NASD fees, printing expenses, fees and
disbursements of counsel and accountants for the Corporation, and all legal fees
and disbursements and other expenses of complying with state securities or Blue
Sky laws of any jurisdiction or jurisdictions in which securities to be offered
are to be registered and qualified. Fees and disbursements of counsel and
accountants for the selling securityholders shall, however, be borne by the
respective selling securityholder.
(h) The rights to cause the Corporation to register all or any portion
of Registrable Securities pursuant to this Section 8 may be assigned by
Purchaser to a transferee or assignee of 20% or more of the Stock. Within a
reasonable time after such transfer the Purchaser shall notify the Corporation
of the name and address of such transferee or assignee and the securities with
respect to which such registration rights are being assigned. Such assignment
shall be effective only if immediately following such transfer the further
disposition of such securities by the transferee or assignee is restricted under
the Act. Any transferee asserting registration rights hereunder shall be bound
by the provisions of this Section 8.
(i) Subject to the rights of Yamanouchi and its assigns under the
Yamanouchi Agreement, which are hereby confirmed, from and after the date of
this Agreement, the Corporation shall not agree to allow the holders of any
securities of the Corporation to include any of their securities in any
registration statement filed by the Corporation pursuant to Subsection (b)
unless the inclusion of such securities will not reduce the amount of the
Registrable Securities included therein.
SECTION IX.
Affirmative Covenants of the Corporation
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The Corporation hereby covenants that, during such time as the
Purchaser (or one of its affiliates) owns any Stock, or for four years,
whichever period is shorter:
1. Reports and Financial Statements.
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(a) The Corporation will cause its common stock to continue to be
registered under Sections 12(b) or 12(g) of the Securities Exchange Act of
1934, will comply in all respects with its reporting and filing obligations
under said Act, and will not take any action or file any document (whether
or not permitted by said Act or the rules thereunder) to terminate or
suspend such registration or to terminate or suspend its reporting and
filing obligations under said Act. The Corporation will take all action
necessary to continue the listing or trading of its common stock on any
national securities exchange or the Automated Quotation System of the
National Association of Securities Dealers on which such common stock is
listed or traded, and will comply in all respects with its reporting,
filing and other obligations under the bylaws or rules of said exchange or
Association.
(b) The Corporation will furnish to the Purchaser, concurrently with the
distribution or filing thereof, each annual and quarterly report to its
shareholders, its reports on Form 10K and 10Q, and each other report,
registration statement, definitive proxy statement or other document filed
with the S.E.C., and each press release or other public announcement issued
by the Corporation.
2. Maintenance of Office. The Corporation will maintain an office or agency
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in the United States at such address as may be designated in writing from time
to time to the registered holders of the Stock, where notices, presentations and
demands to or upon the Corporation in respect of the Stock may be given or made.
Unless or until another office or agency is designated by the Corporation, such
office shall be at the address set forth adjacent to the name of the Corporation
at the foot of this Agreement.
3. Maintenance and Compliance. The Corporation will (i) maintain its
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corporate existence, rights, powers and privileges in good standing, (ii) comply
in all material respects with all laws and governmental regulations and
restrictions applicable to its business or properties, (iii) keep records and
books of account and maintain a system of internal accounting controls in
accordance with generally accepted accounting principles and in compliance with
Section 13(b)(2) of the Securities Exchange Act of 1934, and (iv) retain
independent public
accountants of recognized national standing as auditors of the Corporation's
annual financial statements.
4. Assignment of Rights. The rights of the Purchaser hereunder may be
---------------------
assigned by the Purchaser in connection with the transfer or assignment to a
single transferee of not less than 20% of the Stock originally purchased by the
Purchaser hereunder, and such rights may be further reassigned by such
transferee to another such single transferee. Any transferee asserting rights
under this Agreement shall be bound by its provisions.
5. Effect of Covenants. The covenants in Sections 9.1 and 9.3 shall not be
--------------------
deemed to prohibit a merger, sale of all assets or other corporate
reorganization if (i) the entity surviving or succeeding to the Corporation is
bound by this Agreement with respect to its securities issued in exchange for or
replacement of the Stock, or (ii) the consideration received in exchange for or
replacement of the Stock is cash.
SECTION X.
Legend on Stock
---------------
Each certificate representing the Stock shall be stamped or otherwise
imprinted with a legend substantially in the following form (in addition to any
legend required under any applicable state securities laws):
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED FOR SALE IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.
Upon request of a holder of Stock the Corporation shall remove the
foregoing legend or issue to such holder a new certificate therefor free of any
such legend, if the Corporation shall have received either an opinion of counsel
or a "no-action" letter of the S.E.C., in either case reasonably satisfactory in
substance to the Corporation and its counsel, to the effect that such legend is
no longer required.
SECTION XI.
Miscellaneous
-------------
1. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of California. Any action or proceeding
relating to this Agreement may be brought in the courts of California sitting in
Los Angeles County, or in the United States courts located in Los Angeles
County, California, and each of the parties irrevocably consents to the
jurisdiction of such courts in any such action or proceeding.
2. Successors and Assigns. Except as otherwise expressly provided herein,
----------------------
the provisions hereof shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
3. Entire Agreement; Amendment. This Agreement (including any Exhibits
---------------------------
hereto) and the other documents delivered pursuant hereto constitute the full
and entire understanding and agreement between the parties with regard to the
subjects hereof and thereof. Neither this Agreement nor any term hereof may be
amended, waived, discharged or terminated except by a written instrument signed
by the Corporation and the Purchaser.
4. Notices, etc. All notices and other communications required or permitted
------------
hereunder shall be mailed by first-class mail, postage prepaid, or delivered
either by hand or by messenger, addressed (a) if to the Purchaser, as indicated
below the Purchaser's signature, or at such other address as the Purchaser shall
have furnished to the Corporation in writing, or (b) if to any other holder of
any Stock, at the address of such holder as shown on the records of the
Corporation, or (c) if to the Corporation, at its address set forth below or at
such other address as the Corporation shall have furnished to the Purchaser and
each such other holder in writing. All such notices or communications shall be
deemed given when actually delivered by hand, messenger, facsimile or mailgram
or, if mailed, three days after deposit in the U.S. mail.
5. Delays or Omissions. No delay or omission to exercise any right, power or
-------------------
remedy accruing to any party to this Agreement (including any holder of Stock),
upon any breach or default of another party under this Agreement, shall impair
any such right, power or remedy of such party nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. All remedies, either
under this Agreement or by law or otherwise afforded to any party, shall be
cumulative and not alternative.
6. Severability. In case any provision of the Agreement shall be invalid,
------------
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
7. Titles and Subtitles. The titles of the Sections and subsections of this
--------------------
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement.
8. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the day and year
first written above.
Xxxxxxx Pharmaceutical Corporation
By: ________________________________
Address: Xxxxxxxx Xxxxxx XX
Xxxx Xxxxxxxxxx Xxx Xxxx
Xxxxxxxxx, XX 00000-0000
[ Purchaser ]
By: ________________________________
Address: % Dimensional Fund Advisors
0000 Xxxxx Xxxxxx, 00xx xxxxx
Xxxxx Xxxxxx, XX 00000
