AMENDMENT AGREEMENT
AMENDMENT
AGREEMENT
(the
"Agreement"),
dated
as of July 28, 2006, by and among pSivida Limited, an Australian corporation,
with headquarters located at Xxxxx 00, XXX Centre, 00 Xxx Xxxxxxxxx, Xxxxx,
XX
0000 Xxxxxxxxx (the "Company"),
and
Castlerigg Master Investments Ltd. (the "Investor").
WHEREAS:
A.
The
Company and the Investor are parties to that certain Securities Purchase
Agreement, dated as of October 5, 2005 (the "Securities
Purchase Agreement"),
pursuant to which, among other things, the Investor purchased from the Company
(i) subordinated convertible notes, dated November 16, 2005 (the "Existing
Notes"),
which
are convertible in accordance with their terms into American Depositary Shares
of the Company ("ADSs"
and, as
converted, the "Existing
Conversion Shares")
each
of which represents 10 ordinary shares of the Company (the "Ordinary
Shares")
and is
evidenced by an American Depository Receipt ("ADR")
and
(ii) warrants (the "Existing
Warrants"),
which
are exercisable to purchase ADSs (the "Existing
Warrant Shares").
B.
On
the
Closing Date (as defined in the Securities Purchase Agreement, the Company
and
the Investors entered into a Registration Rights Agreement, dated as of November
16, 2005 (the "Existing
Registration Rights Agreement"),
pursuant to which the Company agreed to provide certain registration rights
with
respect to the Registrable Securities (as defined in the Existing Registration
Rights Agreement) under the Securities Act of 1933, as amended (the
"1933
Act"),
and
the rules and regulations promulgated thereunder, and applicable state
securities laws.
C.
The
Company and the Investor desire to enter into this Agreement, pursuant to which,
among other things, in consideration of extending the deadline under the
Existing Notes with respect to the Company's requirement to obtain the
effectiveness of the Initial Registration Statement (as defined in the
Registration Rights Agreement) in order for there not to be an Event of Default
(a "Registration
Rights Default"),
(i)
the Company shall pay to the Investor the sum of (x) any accrued and unpaid
interest on the Existing Notes as of the Closing Date (as defined below) and
(y)
any Registration Delay Payments (as defined in the Existing Registration Rights
Agreement), including any accrued and unpaid interest thereon, owed by the
Company to the Investor as of the Closing Date (collectively, the "Amendment
Payment Amount");
(ii)
the Company and the Investor shall amend and restate the Existing Notes in
the
form attached hereto as Exhibit
B
(the
"Amended
and Restated Notes"),
which
shall be convertible into ADSs (as converted, the "Amended
and Restated Conversion Shares"),
in
accordance with the terms thereof; (iii) the Company shall issue, upon the
terms
and conditions stated in this Agreement, Series A warrants in the form attached
hereto as Exhibit
C-1
(the
"Series
A Warrants")
which
shall be exercisable to purchase ADSs (the "Series
A Warrant Shares"),
in
accordance with the terms thereof; and (iv) the Company will agree to issue
to
the Investor series B warrants in the form attached hereto as Exhibit
C-2
(the
"Series
B Warrants",
and
together with the Series A Warrants, the "New
Warrants")
from
time to time in accordance with the terms of the Amended and Restated Notes,
which shall be exercisable to purchase ADSs (the "Series
B Warrant Shares",
and
together with the Series A Warrant Shares, the "New
Warrant Shares",
and
together with Amended and Restated Conversion Shares and the Existing Warrant
Shares, the "Amended
and Restated Shares"),
in
accordance with the terms thereof.
D.
The
Amended and Restated Notes will rank pari passu with all Permitted Indebtedness
and shall be senior to all other Indebtedness other than the Permitted Senior
Indebtedness (as defined in the Amended and Restated Notes) and will be secured
by a first priority, perfected security interest, subject to the Permitted
Senior Indebtedness (as defined in the Amended and Restated Notes) in all of
the
Company and any of its Subsidiary's revenue from the Retisert and Vitrasert
product lines (including, without limitation, and successor or replacement
product line of the Company or any of its Subsidiaries or its direct or
indirect, licensees or sublicensees thereof, the "Collateral
Product Lines"),
whether through licenses, assignments or otherwise with the Company or any
of
its Subsidiaries prior to, on or after the Closing Date (collectively, the
"Collateral"),
including, without limitation, any revenue arising under that certain license
agreement, by and among pSivida, Inc. (f/k/a Control Delivery Systems, Inc.),
a
Delaware corporation (the "Delaware
Subsidiary")
and
Bausch & Lomb Incorporated, dated December 9, 2003 (as such has been and may
from time to time be amended, the "BL
License"),
as
evidenced by (i) a collateral assignment agreement, in a form reasonably
satisfactory to the parties (the "Security
Agreement"),
(ii)
a guaranty agreement of the Delaware Subsidiary in a form reasonably
satisfactory to the parties (the "Guarantee"),
and
(iii) such other security documents and ancillary documents and mutually agreed
upon by the parties or required to be entered into hereunder from time to time
(the "Ancillary
Agreements",
and
together with the Security Agreement and the Guarantee, collectively the
"Security
Documents").
E.
On
the
Closing Date (as defined below), the parties hereto are amending and restating
the Registration Rights Agreement in the form attached hereto as Exhibit
F
(the
"Amended
and Restated Registration Rights Agreement"),
pursuant to which the Company has agreed to provide certain registration rights
with respect to the Registrable Securities (as defined in the Amended and
Restated Registration Rights Agreement) under the 1933 Act, and the rules and
regulations promulgated thereunder, and applicable state securities
laws.
F.
On
the
Closing Date, subject to satisfaction (or waiver) of the conditions set forth
in
Sections 5 and 6 below, at the Closing, the Company shall redeem (the
"Note
Redemption")
$2.5
million in principal amount of the Existing Notes for a redemption price to
be
paid in cash to the Investor equal to $3.5 million (the "Note
Redemption Price").
G.
The
amendment and restatement of the Existing Notes and the issuance of the New
Warrants is being made in reliance upon an exemption from registration under
the
1933 Act.
H.
Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings ascribed to them in the Securities Purchase Agreement and, if not
defined therein, the Amended and Restated Notes.
NOW,
THEREFORE,
in
consideration of the foregoing recitals and the mutual promises hereinafter
set
forth, the Company and the Investor hereby agree as follows:
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1.
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AMENDMENT
AND RESTATEMENT OF NOTES AND ISSUANCE OF NEW WARRANTS, NOTE
REDEMPTION.
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(a)
Amendment
and Restatement.
Subject
to satisfaction (or waiver) of the conditions set forth in Sections 5 and 6
below, at the closing contemplated by this Agreement (the "Closing"),
(i)
the terms of the Existing Notes in the principal amount of $12.5 million held
by
the Investor shall be amended and restated with effect from the Closing to
the
terms of the Amended and Restated Notes, (ii) the Company shall issue and
deliver to the Investor the Series A Warrants, exercisable for 5,700,000 ADRs
and (iii) the Company shall pay in cash to the Investor the Amendment Payment
Amount. From time to time in accordance with the terms of the Amended and
Restated Notes, the Company shall issue and deliver to the Investor the Series
B
Warrants exercisable for such number of ADRs as determined in accordance with
the terms of the Amended and Restated Notes.
(b)
Note
Redemption.
Subject
to satisfaction (or waiver) of the conditions set forth in Sections 5 and 6
below, at the Closing, pSivida shall effect the Note Redemption.
(c)
Ratifications.
Except
as otherwise expressly provided herein, (i) the Securities Purchase
Agreement, the Existing Warrants and the Irrevocable Transfer Agent Instructions
are, and shall continue to be, in full force and effect and are hereby ratified
and confirmed in all respects, except that on and after the Closing Date (A)
all
references in the Securities Purchase Agreement to "this Agreement", "hereto",
"hereof", "hereunder" or words of like import referring to the Securities
Purchase Agreement shall mean the Securities Purchase Agreement as amended
by
this Agreement, (B) all references in the Transaction Documents to "this
Agreement", "hereto", "hereof", "hereunder" or words of like import referring
to
the Registration Rights Agreement shall mean the Amended and Restated
Registration Rights Agreement, (C) all references in the other Transaction
Documents to the "Registration Rights Agreement", "thereto", "thereof",
"thereunder" or words of like import referring to the Registration Rights
Agreement shall mean the Registration Rights Agreement as amended by this
Agreement, (D) all references in the Securities Purchase Agreement and the
other
Transaction Documents to "Transaction Documents" shall also include this
Agreement, the Amended and Restated Notes, the New Warrants and the Security
Documents, (E) all references in the Securities Purchase Agreement and the
other
Transaction Documents to "Notes" shall mean the Amended and Restated Notes,
(F)
all references in the Securities Purchase Agreement and the other Transaction
Documents to "Conversion Shares" shall mean the Amended and Restated Conversion
Shares, (G) all references in the Securities Purchase Agreement and the other
Transaction Documents to "Warrants" shall be amended to include the New
Warrants, and (H) all references in the Securities Purchase Agreement and the
other Transaction Documents to "Warrant Shares" shall be amended to include
New
Warrant Shares, and (ii) the execution, delivery and effectiveness of this
Agreement shall not operate as an amendment of any right, power or remedy of
the
Investor under any Transaction Document, nor constitute an amendment of any
provision of any Transaction Document.
(d)
Closing
Date.
The
date and time of the Closing (the "Closing
Date")
shall
be 10:00 a.m., New York Time, on August 3, 2006 after notification of
satisfaction (or waiver) of the conditions to the Closing set forth in Sections
5 and 6 below (or such other time and date as is mutually agreed to by the
Company and the Investor). The Closing shall occur on the Closing Date at the
offices of Xxxxxxx Xxxx & Xxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000.
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(e)
Form
of Payment.
On the
Closing Date, (i) the Company (A) shall pay to the Investor the
Amendment Payment Amount and the Note Redemption Price, by wire transfer of
immediately available funds in accordance with the Investor's written wire
instructions provided to the Company prior to the Closing, (B) shall issue
and deliver to the Investor, the Investor's Amended and Restated Notes, duly
executed on behalf of the Company and registered in the name of the Investor,
and (C) shall issue and deliver to the Investor, the Investor's Series A
Warrants, duly executed on behalf of the Company and registered in the name
of
the Investor, and (ii) the Investor shall deliver to the Company the
Investor's Existing Notes for cancellation.
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2.
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AMENDMENTS
TO SECURITIES PURCHASE AGREEMENT.
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The
Securities Purchase Agreement is hereby amended as follows:
(a)
Section
2(j)(A) shall
be
deleted in its entirety;
(b)
Section
2(j)(B) shall be deleted in its entirety; and
(c)
Notwithstanding
anything in Sections 4(n)(ii) and 4(n)(iii) to the contrary, the Company shall
not be required to comply with either Section 4(n)(ii) or 4(n)(iii), except
as
to allow the Investor the rights set forth in the following
sentence:
The
Investor shall have the option to participate in such Subsequent Placement
with
the purchase price of such securities being paid by surrender of outstanding
principal amount of the Amended and Restated Note plus any accrued and unpaid
interest on such principal and late charges, if any, on such principal and
interest.
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3.
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REPRESENTATIONS
AND WARRANTIES
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(a)
Investor
Bring Down.
The
Investor hereby represents and warrants to the Company as set forth in Section
2
of the Securities Purchase Agreement (as amended hereby) as to this Agreement
as
if such representations and warranties were made as of the date hereof and
set
forth in their entirety in this Agreement. The Investor hereby represents and
warrants to the Company with respect to itself only that it is not actually
aware of any outstanding Events of Default. The Investor further represents
and
warrants to the Company that: (a) it is the sole holder of the Existing Notes;
(b) that it has not transferred beneficial ownership thereof; and (c) this
agreement shall constitute written consent of the Required Holders pursuant
to
Section 17 of the Note.
(b)
Company
Bring Down.
The
Company represents and warrants to the Investor as set forth in Section 3 of
the
Securities Purchase Agreement (as amended hereby) as if such representations
and
warranties were made as of the date hereof and set forth in their entirety
in
this Agreement; provided that the Schedules to the Securities Purchase Agreement
are replaced in their entirety by the Schedules attached to this Agreement
(the
"New
Schedules").
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Such
representations and warranties in the Securities Purchase Agreement to the
transactions thereunder and the securities issued thereby are hereby deemed
for
purposes of this Agreement to be references to the transactions hereunder and
the issuance of the securities hereby, and references therein to "Closing
Date"
being
deemed references to the Closing Date as defined in Section 1(d) above. The
Company represents and warrants to the Investor that it is not aware of any
outstanding Events of Default other than the Registration Rights Default. The
Company represents and warrants to the Investor that this Agreement, the terms
of the Amended and Restated Notes, the terms of the Series A Warrants, the
terms
of the Series B Warrants, the issue of the Series A Warrants and the agreement
to issue Series B Warrants contemplated by the Amended and Restated Notes and
the agreement to issue shares or ADRs on exercise of the Amended and Restated
Notes, Series A Warrants or Series B Warrants: (i) comply in all respects with
the Corporations Xxx 0000 (Cwth) and the Listing Rules of the Australian Stock
Exchange Limited; and, (ii) do not require any approval from the Australian
Stock Exchange Limited or shareholders of the Company. The
Company will not challenge, and based on the facts in existence as of the date
hereof, has no basis to disagree with, the Investor's position that the holding
period of the Amended and Restated Notes, the New Warrants and the Amended
and
Restated Conversion Shares may be tacked back to the date of issuance of the
Existing Notes for purposes of Rule 144 promulgated under the 1933 Act (or
a
successor rule) and will not take any action which would be likely to adversely
affect such tacking for the benefit of the Investor, including, without
limitation, taking negative action with respect to the reliance by the Company's
transfer agent on an opinion letter of the Investor's Legal
Counsel.
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4.
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CERTAIN
COVENANTS AND AGREEMENTS; RELEASE
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(a)
Disclosure
of Transactions and Other Material Information.
On or
before 10:30 a.m., New York Time, on the
first
Business Day following the date of this Agreement, the Company shall issue
a
press release (the "Initial
Press Release")
and
shall file a Form 6-K describing the terms of the transactions contemplated
by
this Agreement in the form required by the 1934 Act and attaching the material
Transaction Documents (including, without limitation, this Agreement (other
than
the schedules to this Agreement), the form of each of the Amended and Restated
Notes, the form of each of the New Warrants, the form of the Amended and
Restated Registration Rights Agreement and the form of Security Documents,
if
available) as exhibits to such submission (such submission including all
attachments, the "Initial
6-K Filing").
On or
before 8:30 a.m., New York Time, on the
first
Business Day following the Closing Date, the Company shall issue a press release
(the "Closing
Press Release")
and
shall file a Form 6-K describing the terms of the transactions contemplated
by
this Agreement in the form required by the 1934 Act and attaching any material
transaction documents not previously filed as exhibits to such filing
(including, without limitation, this Agreement (other than the schedules to
this
Agreement), the form of each of the Amended and Restated Notes, the form of
each
of the New Warrants, the form of the Amended and Restated Registration Rights
Agreement and the form of Security Documents, if available) as exhibits to
such
submission (such submission including all attachments, the "Closing
6-K Filing",
and
together with the Initial 6-K Filing, the "6-K
Filings").
The
Initial Press Release and the Closing Press Release shall also indicate that
the
Company is seeking to raise additional funding. From and after the submission
of
the Closing 6-K Filing with the SEC, no Investor shall be in possession of
any
material, nonpublic information received from the Company, any of its
Subsidiaries or any of its respective officers, directors, employees or agents,
that is not disclosed in the 6-K Filings or in
5
some
other public filing or public disclosure. The Company shall not, and shall
cause
each of its Subsidiaries and its and each of their respective officers,
directors, employees and agents, not to, provide the Investor with any material,
nonpublic information regarding the Company or any of its Subsidiaries from
and
after the filing of the Closing 6-K Filing with the SEC without the express
written consent of the Investor. In the event of a breach of the foregoing
covenant by the Company, any of its Subsidiaries, or any of its or their
respective officers, directors, employees and agents, in addition to any other
remedy provided herein or in the Transaction Documents, the Investor shall
have
the right to require the Company to make promptly a public disclosure, in the
form of a press release, public advertisement or otherwise, of such material,
nonpublic information. Subject to the foregoing, neither the Company, its
Subsidiaries nor the Investor shall issue any press releases or any other public
statements with respect to the transactions contemplated hereby; provided,
however,
that
the Company shall be entitled, without the prior approval of the Investor,
to
make any press release or other public disclosure with respect to such
transactions (i) in substantial conformity with the 6-K Filings and
contemporaneously therewith and (ii) as is required by applicable law and
regulations (provided that in the case of clause (i) the Investor shall be
consulted by the Company in connection with any such press release or other
public disclosure prior to its release).
(b)
Fees
and Expenses.
The
Company shall reimburse the Investor for its legal fees and expenses in
connection with the preparation and negotiation of this Agreement and including
matters relating to the threatened Registration Rights Default by paying such
amount to Xxxxxxx Xxxx & Xxxxx LLP as set forth in such firm's written
invoice therefore (the "Investor
Counsel Expense").
Except as otherwise set forth in this Agreement, each party shall pay the fees
and expenses of its advisers, counsel, accountants and other experts, if any,
and all other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement. The Company
shall pay all stamp and other taxes and duties levied in connection with the
issuance of the Amended and Restated Notes and New Warrants.
(c)
Post-Closing
Covenant.
On or
prior to ten (10) Business Days after the Closing Date, the Company shall have
taken such actions as reasonably requested by the Investor to secure the
Collateral and perfect the Collateral Agent's security interest in the
Collateral, including, without limitation, by entering into the Security
Documents and filing any necessary UCC financing statements. The failure to
effect the foregoing shall immediately constitute an Event of Default under
the
Amended and Restated Notes. Within five (5) Business Days after the Closing,
the
Company shall have delivered or caused to be delivered to the Investor (i)
true
copies of UCC search results in Massachusetts and Delaware, listing all
effective financing statements which name as debtor the Company or any of its
U.S.-based Subsidiaries filed in the prior five (5) years to perfect an interest
in any assets thereof, together with copies of such financing statements, none
of which, except as otherwise agreed in writing by the Investor, shall cover
any
of the Collateral and, within ten (10) Business Days after the Closing, the
results of searches for any tax lien and judgment lien in Middlesex County,
Massachusetts and Delaware filed against such Person or its property, which
results, except as otherwise agreed to in writing by the Investor shall not
show
any such Liens (as defined in the Security Documents); and (ii) a perfection
certificate, duly completed and executed by the Company and each of its
Subsidiaries, in form and substance satisfactory to the Investor.
6
(d)
Future
Collateral.
So long
as any Notes remain outstanding, if at any time (a "Future
Collateral Event Date")
(i)
the Company or any of its Subsidiaries receives income, proceeds or revenue
relating to any Collateral pursuant to a license, agreement or other arrangement
or circumstance other than the BL License (each a "Future
Agreement",
and
the parties to such Agreement other than the Company or any of its Subsidiaries,
the "Future
Consenting Parties")
or
(ii) any income, proceeds or revenue relating to any Collateral is owed or
paid
directly to the Company or any Subsidiary other than the Delaware Subsidiary,
then the Company shall promptly notify the Investor in writing and within ten
(10) business days after such Future Collateral Event Date, (w) if such income,
proceeds or revenue is owed or paid to a Subsidiary other than the Delaware
Subsidiary, such Subsidiary shall duly execute and deliver a guaranty in the
form of the Guarantee, (x) if such income, proceeds or revenue is owed or paid
to the Company, the Company shall duly execute and/or deliver such opinions
of
counsel and other documents, in form and substance reasonably acceptable to
the
Investor to secure and perfect a security interest in such Collateral, (y)
if
such income, proceeds or revenue is from a Future Agreement, the parties hereto
shall amend the Security Agreement and/or enter into any other necessary
security documents, including, without limitation, any assignments or charges,
to include such Future Agreement, and (z) the Company shall deliver to the
Investor a consent of the Future Consenting Parties, in form and substance
reasonably acceptable to the Investor.
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5.
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CONDITIONS
TO COMPANY'S OBLIGATIONS HEREUNDER.
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The
obligations of the Company to the Investor hereunder are subject to the
satisfaction of each of the following conditions, provided that these conditions
are for the Company's sole benefit and may be waived by the Company at any
time
in its sole discretion by providing the Investor with prior written notice
thereof:
(a)
The
Investor shall have executed this Agreement and delivered the same to the
Company.
(b)
The
representations and warranties of the Investor shall be true and correct in
all
material respects (except for those representations and warranties that are
qualified by materiality or Material Adverse Effect, which shall be true and
correct in all respects) as of the date when made and as of the Closing Date
as
though made at that time (except for representations and warranties that speak
as of a specific date, which shall remain true and correct as of such specific
date).
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6.
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CONDITIONS
TO INVESTOR'S OBLIGATIONS
HEREUNDER.
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The
obligations of the Investor hereunder are subject to the satisfaction of each
of
the following conditions, provided that these conditions are for the Investor's
sole benefit and may be waived by the Investor at any time in its sole
discretion by providing the Company with prior written notice
thereof:
(a)
The
Company shall have executed this Agreement and delivered the same to the
Investor.
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(b)
The
Company shall have executed and delivered to the Investor the Amended and
Restated Notes and the New Warrants being issued to such Investor at the
Closing.
(c)
The
Company shall have delivered to the Investor such Investors Amendment Payment
Amount and the Note Redemption Price by wire transfer of immediately available
funds pursuant to the wire instructions provided by the Investor.
(d)
The
Company shall have delivered to the Company's transfer agent, with a copy to
the
Investors, a letter stating that the
Irrevocable Transfer Agent Instructions dated October 5, 2005 shall also apply
to the Amended and Restated Shares.
(e)
Such
Investor shall have received the opinion of Xxxxxx, Xxxxxx-Xxxxxxx, Colt &
Mosle LLP, the Company's outside U.S. counsel, and Xxxxx Xxxxxx Xxxxxxx, the
Company's outside Australian counsel, each dated as of the Closing Date, similar
in all material respects to the opinions delivered pursuant to the Securities
Purchase Agreement.
(f)
The
Company shall have delivered to the Investor a certificate, executed by the
Secretary of the Company and dated as of the Closing Date, as to (i) the
resolutions approving the transactions contemplated hereby as adopted by the
Board in a form reasonably acceptable to the Investor, (ii) the Certificate
of
Incorporation and (iii) the Bylaws, each as in effect as of the Closing, similar
in all material respects to the certificate executed by the Secretary of the
Company delivered pursuant to the Securities Purchase Agreement.
(g)
The
representations and warranties of the Company shall be true and correct in
all
material respects (except for those representations and warranties that are
qualified by materiality or Material Adverse Effect, which shall be true and
correct in all respects) as of the date when made and as of the Closing Date
as
though made at that time (except for representations and warranties that speak
as of a specific date, which shall remain true and correct as of such specific
date) and the Company shall have performed, satisfied and complied in all
material respects with the covenants, agreements and conditions required by
the
Transaction Documents to be performed, satisfied or complied with by the Company
at or prior to the Closing Date and no Default or Event of Default shall have
occurred and be continuing on the date hereof either immediately before or
after
giving effect to this Agreement in accordance with its terms. The Investor
shall
have received a certificate, executed by the Chief Executive Officer of the
Company, dated as of the Closing Date, to the foregoing effect and as to such
other matters as may be reasonably requested by the Investor, similar in all
material respects to the certificate executed by the Chief Executive Officer
of
the Company delivered pursuant to the Securities Purchase
Agreement.
(h)
The
ADRs
(I) shall be designated for quotation or listed on the Principal Market and
(II)
shall not have been suspended, as of the Closing Date, by the SEC or the
Principal Market from trading on the Principal Market nor shall suspension
by
the SEC or the Principal Market have been threatened, as of the Closing Date,
either (A) in writing by the SEC or the Principal Market or (B) by falling
below
the minimum listing maintenance requirements of the Principal
Market.
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(i)
The
Company shall have obtained all governmental, regulatory or third party consents
and approvals, if any, necessary for the issue and sale of the Securities,
including, without limitation, any approvals or notifications required by the
Principal Market.
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7.
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STOCKHOLDER
APPROVAL
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(a)
Stockholder
Approval.
The
Company represents and warrants that no Stockholder Approval (as defined below)
is required by the applicable rules of the Principal Market or other applicable
securities laws for the issuance of any of the Amended and Restated Shares
and
any stockholder approval previously obtained by the Company with respect to
the
issuance of the Securities pursuant to the terms of the Transaction Documents
will be valid and applicable to the issuance of the Amended and Restated Shares.
If at any time after the Closing Date the issuance of the Amended and Restated
Shares would exceed that number of shares of Common Stock which the Company
may
issue without breaching the Company's obligations under the rules or regulations
of the Principal Market and the Company has not obtained the approval of its
stockholder a required by the applicable rules of the Principal Market, which
is
sufficient to cure such breach prior to the Closing Date, then the Company
shall
obtain the approval of its stockholders as required by the applicable rules
of
the Principal Market for issuances of the Amended and Restated Shares in excess
of such amount. At such time, the Company shall provide each stockholder
entitled to vote at a special or annual meeting of stockholders of the Company
(the "
Stockholder Meeting"),
which
shall be promptly called and held not later than 45 days after the earlier
of
(i) the Principal Market indication of and (ii) the Company becoming aware
of,
any limitation imposed by the Principal Market on the issuance of Amended and
Restated Shares (the "Stockholder
Meeting Deadline"),
a
proxy statement, substantially in the form which has been previously reviewed
by
the Investor and Xxxxxxx Xxxx & Xxxxx LLP, at the expense of the Company,
soliciting each such stockholder's affirmative vote at the Stockholder Meeting
for approval of resolutions providing for the Company's issuance of all of
the
Amended and Restated Shares as described in the Transaction Documents in
accordance with applicable law and the rules and regulations of the Principal
Market and
such
affirmative
approval being referred to herein as the "Stockholder
Approval"),
and
the Company shall use its reasonable best efforts to solicit its stockholders'
approval of such resolutions and to cause the Board of Directors of the Company
to recommend to the stockholders that they approve such resolutions. The Company
shall be obligated to use its reasonable best efforts, to obtain the Stockholder
Approval by the Stockholder Meeting Deadline. If, despite the Company's
reasonable best efforts the Stockholder Approval is not obtained on or prior
to
the Stockholder Meeting Deadline, the Company shall cause an additional
Stockholder Meeting to be held each twelve month period thereafter until such
Stockholder Approval is obtained, provided that if the Board of Directors of
the
Company does not recommend to the stockholders that they approve such
resolutions at any such Stockholder Meeting and the Stockholder Approval is
not
obtained, or the Amended and Restated Notes are no longer outstanding, the
Company shall cause an additional Stockholder Meeting to be held each calendar
quarter thereafter until such Stockholder Approval is obtained.
|
8.
|
TERMINATION.
|
In
the
event that the Closing does not occur by August 15, 2006, due to the Company's
or the Investors' failure to satisfy the conditions set forth in Sections 5
and
6 hereof
9
(and
the
nonbreaching party's failure to waive such unsatisfied conditions(s)), the
nonbreaching party shall have the option to terminate this Agreement at the
close of business on such date without liability of any party to any other
party; provided,
however,
this if
this Agreement is terminated by the non-breaching Investor pursuant to this
Section 8, the Company shall remain obligated to reimburse the Investor for
the
expenses described in Section 4(c) above. Upon such termination, the terms
hereof shall be null and void and the parties shall continue to comply with
all
terms and conditions of the Transaction Documents, as in effect prior to the
execution of this Agreement.
|
9.
|
MISCELLANEOUS.
|
(a)
Counterparts.
This
Agreement may be executed in two or more identical counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature shall be considered due execution and shall
be binding upon the signatory thereto with the same force and effect as if
the
signature were an original, not a facsimile signature.
(b)
Headings.
The
headings of this Agreement are for convenience of reference and shall not form
part of, or affect the interpretation of, this Agreement.
(c)
Severability.
If any
provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or
the
validity or enforceability of any provision of this Agreement in any other
jurisdiction.
(d)
Governing
Law; Jurisdiction; Jury Trial.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision
or
rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State
of
New York. Each party hereby irrevocably submits to the exclusive jurisdiction
of
the state and federal courts sitting in The City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction
of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process
and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it
under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
If any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or
the
validity or enforceability of any provision of this Agreement in any other
jurisdiction. EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED
HEREBY.
10
(e)
No
Third Party Beneficiaries.
This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.
(f)
Further
Assurances.
Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.
(g)
No
Strict Construction.
The
language used in this Agreement will be deemed to be the language chosen by
the
parties to express their mutual intent, and no rules of strict construction
will
be applied against any party.
(h)
Entire
Agreement; Effect on Prior Agreements; Amendments.
Except
for the Transaction Documents (to the extent any such Transaction Document
is
not amended by this Agreement), this Agreement supersedes all other prior oral
or written agreements between the Investor, the Company, their affiliates and
Persons acting on their behalf with respect to the matters discussed herein,
and
this Agreement and the instruments referenced herein contain the entire
understanding of the parties with respect to the matters covered herein and
therein and, except as specifically set forth herein or therein, neither the
Company nor the Investor makes any representation, warranty, covenant or
undertaking with respect to such matters. No provision of this Agreement may
be
amended other than by an instrument in writing signed by the Company and the
Investor. No provision hereof may be waived other than by an instrument in
writing signed by the party against whom enforcement is sought. No consideration
shall be offered or paid to any Person to amend or consent to a waiver or
modification of any provision of any of the Transaction Documents unless the
same consideration also is offered to all of the parties to the Transaction
Documents, holders of Amended and Restated Notes or holders of the New Warrants,
as the case may be. The Company has not, directly or indirectly, made any
agreements with any of the Investors relating to the terms or conditions of
the
transactions contemplated by the Transaction Documents except as set forth
in
the Transaction Documents.
(i)
Notices.
Any
notices, consents, waivers or other communications required or permitted to
be
given under the terms of this Agreement must be in writing and will be deemed
to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending party);
or (iii) one Business Day after deposit with an overnight courier service,
in
each case properly addressed to the party to receive the same. The addresses
and
facsimile numbers for such communications shall be:
11
If
to the
Company:
pSivida
Limited
Xxxxx
00,
XXX Xxxxxx
00
Xxx
Xxxxxxxxx, Xxxxx
XX
0000
Xxxxxxxxx
Telephone: 00
0 0000
0000
Facsimile: 61
8 9226
5499
Attention: Xxxxx
Xxxxx, Managing Director
with
a
copy (for informational purposes only) to:
Xxxxxx,
Xxxxxx-Xxxxxxx, Colt & Mosle LLP
000
Xxxx
Xxxxxx
Xxx
Xxxx,
X.X.
X.X.X.
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxxxxxx
Xxxxxxx, Esq.
If
to the
Investor, to its address and facsimile number set forth in the Securities
Purchase Agreement, with copies to the Investor's representatives as set forth
on the Securities Purchase Agreement or on the signature page to this Agreement,
with
a
copy (for informational purposes only) to:
Xxxxxxx
Xxxx & Xxxxx LLP
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
X.X.X.
Telephone: (000)
000-0000
Facsimile: (000)
000-0000
Attention: Xxxxxxx
X. Xxxxx, Esq.
or
to
such other address and/or facsimile number and/or to the attention of such
other
Person as the recipient party has specified by written notice given to each
other party five (5) days prior to the effectiveness of such change. Written
confirmation of receipt (A) given by the recipient of such notice, consent,
waiver or other communication, (B) mechanically or electronically generated
by
the sender's facsimile machine containing the time, date, recipient facsimile
number and an image of the first page of such transmission or (C) provided
by an
overnight courier service shall be rebuttable evidence of personal service,
receipt by facsimile or receipt from an overnight courier service in accordance
with clause (i), (ii) or (iii) above, respectively.
The
Company hereby irrevocably appoints National Corporate Research, Ltd.,
of 000
Xxxx
00xx
Xxxxxx,
Xxxxx 000, Xxx Xxxx, X.X. 00000, X.X.X. ("NCR")
as its
agent for the receipt of service of process in the United States. The Company
agrees that any document may be effectively served on it in connection with
any
action, suit or proceeding in the United States by service on its agents. The
Investor consents and agrees that the Company may, in its reasonable discretion,
irrevocably appoint a substitute agent for the receipt of service of process
located within the Untied States, and that upon such appointment, the
appointment of NCR may be revoked.
12
Any
document shall be deemed to have been duly served if marked for the attention
of
the agent at its address as set forth in Section 9(i) or such other address
in
the United States as may be notified to the party wishing to serve the document
and (a) left at the specified address if its receipt is acknowledged in writing;
or (b) sent to the specified address by post, registered mail return receipt
requested. In the case of (a), the document will be deemed to have been duly
served when it is left and signed for. In the case of (b), the document shall
be
deemed to have been duly served when received and acknowledged.
If
the
Company's agent at any time ceases for any reason to act as such, the Company
shall appoint a replacement agent having an address for service in the United
States and shall notify the Investor of the name and address of the replacement
agent. Failing such appointment and notification, the holders of Amended and
Restated Notes representing not less than a majority of the aggregate principal
amount of the then outstanding Amended and Restated Notes shall be entitled
by
notice to the Company to appoint a replacement agent to act on the Company's
behalf. The provisions of this Section 9(i) applying to service on an agent
apply equally to service on a replacement agent.
(j)
Successors
and Assigns.
This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors and assigns in accordance with the terms of the
Securities Purchase Agreement.
(k)
Survival.
Unless
this Agreement is terminated under Section 8, the representations and warranties
of the Company and the Investor contained herein and the agreements and
covenants set forth herein shall survive the Closing.
(l)
Remedies.
The
Investor and each holder of the Securities shall have all rights and remedies
set forth in the Transaction Documents and all rights and remedies which such
holders have been granted at any time under any other agreement or contract
and
all of the rights which such holders have under any law. Any Person having
any
rights under any provision of this Agreement shall be entitled to enforce such
rights specifically (without posting a bond or other security), to recover
damages by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. Furthermore, the Company recognizes
that in the event that it fails to perform, observe, or discharge any or all
of
its obligations under this Agreement, any remedy at law may prove to be
inadequate relief to the Investor. The Company therefore agrees that the
Investor shall be entitled to seek temporary and permanent injunctive relief
in
any such case without the necessity of proving actual damages and without
posting a bond or other security.
[Signature
Page Follows]
13
IN
WITNESS WHEREOF,
the
Investor and the Company have caused their respective signature page to this
Agreement to be duly executed as of the date first written above.
|
COMPANY:
PSIVIDA
LIMITED
|
||
| By: |
/s/
Xxxxxxx X.
Xxxx
Name:
Xxxxxxx X. Xxxx
Title:
Vice President and CFO
|
|
IN
WITNESS WHEREOF,
the
Investor and the Company have caused their respective signature page to this
Agreement to be duly executed as of the date first written above.
|
INVESTOR:
CASTLERIGG
MASTER INVESTMENTS
LTD.
BY:
XXXXXXX ASSET MANAGEMENT CORP.
|
||
| By: |
/s/
Xxxxxxx X. Xxxxx
Name:
Xxxxxxx X. Xxxxx
Title:
Senior Managing Director
|
|
