EXHIBIT 4.3
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made as of the 3rd
day of November, 1997 by and between VICAL INCORPORATED, a Delaware
corporation (the "Company"), and MERCK HOLDINGS, INC., a Delaware corporation
("Investor").
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. PURCHASE AND SALE OF STOCK.
1.1 SALE AND ISSUANCE OF COMMON STOCK. Subject to the terms and
conditions of this Agreement, Investor hereby purchases and the Company
hereby sells and issues to Investor 261,812 shares (the "Shares") of the
Company's Common Stock for the purchase price of the greater of $16.00 per
share or 125% of the average Nasdaq closing price per share during the 20-day
consecutive trading period prior to, but not including, the Effective Date of
the Amended License Agreement (as defined herein) between the Company and
Investor (such average Nasdaq closing price is hereinafter referred to as the
"Base Price" and such per share purchase price is hereinafter referred to as
the "Per Share Purchase Price") for an aggregate of $5,000,000 (the "Purchase
Price").
1.2 CLOSING. The purchase and sale of the Common Stock shall take
place at the offices of the Company, 0000 Xxxxx Xxxxxx Xxxxx, Xxx Xxxxx,
Xxxxxxxxxx, at 10 A.M., on the date which is ten days following the date of
this Agreement, or at such other times and places as the Company and Investor
mutually agree upon, verbally or in writing (which times and places are
designated as the "Closing"). At the Closing the Company shall deliver to
Investor a certificate representing the Common Stock which such Investor is
purchasing against delivery to the Company by such Investor of a bank wire in
same day funds in the amount of the Purchase Price therefor payable to the
Company's order.
1.3 DEFINITIONS.
(a) The following terms, as used herein, have the following meanings:
"Closing Date" means the date of the Closing.
"Common Stock" means the Common Stock, par value $0.01 per share of the
Company, together with the associated preferred stock purchase rights
established pursuant to the Rights Agreement dated March 20, 1995 between the
Company and ChaseMellon Shareholder Services L.L.C. as rights agent (the
"Rights").
"Material Adverse Effect" means a material adverse effect on the
condition (financial or otherwise), business, assets, results of operations
of a corporation and its subsidiaries taken as a whole.
"1934 Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"1933 Act" means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
"Person" shall mean an individual, corporation, partnership, trust,
business trust, association, joint stock company, joint venture, pool,
syndicate, sole proprietorship, unincorporated organization, governmental
authority or any other form of entity not specifically listed herein.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Investor that:
2.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate power and
authority to carry on its business as now conducted. The Company is duly
qualified to transact business and is in good standing in each jurisdiction
in which the failure so to qualify would have a Material Adverse Effect.
2.2 CAPITALIZATION. The authorized capital of the Company consists of:
(i) PREFERRED STOCK. 5,000,000 shares of Preferred Stock, of which
40,000 shares have been designated Series A Participating Preferred Stock,
par value $.01 per share (the "Participating Preferred Stock"). There are no
shares of Participating Preferred Stock issued and outstanding.
(ii) COMMON STOCK. 40,000,000 shares of Common Stock, of which
15,460,802 shares were issued and outstanding on August 15, 1997.
2.3 AUTHORIZATION. All corporate action on the part of the Company,
its officers, directors and stockholders necessary for (i) the authorization,
execution and delivery of this Agreement, (ii) the performance of all
obligations of the Company hereunder and (iii) the authorization, issuance
(or reservation for issuance) and delivery of the Common Stock being sold
hereunder, to the extent that the foregoing requires performance on or prior
to the Closing, has been taken and this Agreement constitutes the valid and
legally binding obligation of the Company, enforceable against the Company in
accordance with its terms.
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2.4 VALID ISSUANCE OF COMMON STOCK. The Common Stock purchased by the
Investor hereunder has been duly and validly issued and is fully paid and
nonassessable and, based in part upon the representations of the Investor in
this Agreement, was issued in compliance with all applicable federal and
state securities laws.
2.5 SEC FILINGS. The Company has registered its Common Stock pursuant
to Section 12 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the Common Stock is listed and trades on the NASDAQ
National Market System. The Company has filed all forms, reports and
documents required to be filed pursuant to the federal securities laws and
the rules and regulations promulgated thereunder for a period of at least
twelve (12) months immediately preceding the offer or sale of the Shares (or
for such shorter period that the Company has been required to file such
material). The Company's filings with the SEC complied as of their
respective filing dates, or in the case of registration statements, their
respective effective dates, in all material respects with all applicable
requirements of the Securities Act of 1933 (the "Securities Act") and the
Exchange Act and the rules and regulations promulgated thereunder. None of
such filings, including, without limitation, any exhibits, financial
statements or schedules included therein, at the time filed, or in the case
of registration statements, at their respective filing dates, contained any
untrue statement of a material fact or omitted 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.
2.6 LITIGATION. Except as disclosed in the Company's filings with the
SEC, there is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending or, to the
knowledge of the Company, threatened, against or affecting the Company, or
any of its properties, which might result in any material adverse change in
the condition (financial or otherwise) or in the earnings, business affairs
or business prospects of the Company, or which might materially and adversely
affect the properties or assets thereof.
2.7 NO DEFAULT. Except as disclosed in the Company's filings with the
SEC, the Company is not in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust or other material agreement or INSTRUMENT
to which it is a party or by which it or its property may be bound, except
for defaults that have not had and would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
2.8 SUBSEQUENT EVENTS. Since December 31, 1996, (i) the Company has
incurred no liability or obligation, contingent or otherwise, that taken as a
whole, is material in the aggregate to the Company, except in the ordinary
course of
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business, and (ii) there has been no material adverse change in the condition
or results of operations, financial or otherwise, of the Company, taken as a
whole.
2.9 CONSENTS AND APPROVALS. No consent, approval, qualification, order
or authorization of, or filing with, any local, state or federal governmental
authority or any third party is required on the part of the Company in
connection with the Company's valid execution, delivery or performance of
this Agreement, or the offer, sale or issuance of the Shares by the Company,
other than the filings that have been made prior to the Closing, except that
any notices of sale required to be filed by the Company with the SEC under
Regulation D of the Securities Act, or such post-closing filings as may be
required under applicable state securities laws, which will be timely filed
within the applicable periods therefor.
2.10 COMPLIANCE WITH LAWS AND COURT ORDERS. The Company is not in
violation of any applicable law, rule, regulation, judgment, injunction,
order or decree except for violations that have not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
3. REPRESENTATIONS AND WARRANTIES OF INVESTOR. This Agreement is
made with Investor in reliance upon the Investor's representation and
warranties to the Company, which by such Investor's execution of this
Agreement the Investor hereby confirms, that:
3.1 ORGANIZATION AND EXISTENCE. Investor is a corporation duly
incorporated, validly existing and in good standing under the laws of
Delaware and has all corporate powers and all material governmental licenses,
authorizations, permits, consents and approvals required to carry on its
business as now conducted, except for those licenses, authorizations,
permits, consents and approvals the absence of which would not, individually
or in the aggregate, have a Material Adverse Effect.
3.2 CORPORATE AUTHORIZATION. This execution, delivery and
performance by Investor of this Agreement are within the corporate powers of
Investor and have been duly authorized by all necessary corporate action on
the part of Investor. This Agreement constitutes its valid and legally
binding obligation, enforceable in accordance with its terms.
3.3 PURCHASE ENTIRELY FOR OWN ACCOUNT. The Common Stock to be
received by Investor will be acquired for investment for Investor's own
account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof, and that Investor has no present intention
of selling, granting any participation in, or otherwise distributing the
same. By executing this Agreement, Investor further represents that Investor
does not have any contract, undertaking, agreement or
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arrangement with any person to sell, transfer or grant participation to such
person or to any third person, with respect to any of the Common Stock.
3.4 CONFIDENTIALITY. Investor hereby represents, warrants and
covenants that it shall maintain as confidential all information provided to
it by the Company hereunder in accordance with and under the same terms as
Article VI of the Amended License Agreement.
3.5 RESTRICTED SECURITIES. Investor understands that the shares of
Common Stock it is purchasing are characterized as "restricted securities"
under the federal securities laws inasmuch as they are being acquired from
the Company in a transaction not involving a public offering and that under
such laws and applicable regulations such securities may be resold without
registration under the 1933 Act, only in certain limited circumstances. In
this connection Investor represents that it is familiar with Securities and
Exchange Commission ("SEC") Rule 144, as presently in effect, and understands
the resale limitations imposed thereby and by the 1933 Act.
3.6 LEGENDS. It is understood that the certificates evidencing the
Common Stock may bear one or all of the following legends:
(a) "These securities have not been registered under the Securities
Act of 1933. They may not be sold, offered for sale, pledged or hypothecated
in the absence of a registration statement in effect with respect to the
securities under such Act or an opinion of counsel satisfactory to the
Company that such registration is not required or unless sold pursuant to
Rule 144 of such Act."
(b) If required by the authorities of any state in connection with
the issuance or sale of the Common Stock the legend required by such state
authority.
4. ADDITIONAL DELIVERIES TO INVESTOR AT CLOSING. The obligations
of Investor under Subsection of this Agreement are subject to the
fulfillment on or before the Closing of each of the following conditions, the
waiver of which shall not be effective if such Investor does not consent in
writing thereto:
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4.1 COMPLIANCE CERTIFICATE. The President or a Vice President of
the Company shall deliver to Investor at the Closing a certificate stating
that there has been no material adverse change in the business, affairs,
prospects, operations, properties, assets or condition of the Company since
June 30, 1997 other than because of operating losses and changes in the
ordinary course of business.
4.2 SECRETARY'S CERTIFICATE. The Secretary of the Company shall
deliver to Investor at the Closing a certificate certifying that attached
thereto are true and complete copies of each of the following documents:
(a) Restated Certificate of Incorporation as in effect on the
Closing Date, of the Company;
(b) Bylaws, as amended as in effect on the Closing Date, of the
Company; and
(c) Copies of the resolutions of the Company's Board of Directors
authorizing execution and delivery of this Agreement and to the Third
Amendment to Research Collaboration and License Agreement, dated May 31,
1991, amended as of the date hereof, between the Company and Investor (the
"Amended License Agreement") and performance of the transactions contemplated
herein and therein.
4.3 HSR ACT. If applicable, the waiting period under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, including any
extensions of said waiting period, shall have expired and any investigations
relating to the transactions contemplated herein and in the Amended License
Agreement that may have been opened by either the Department of Justice or
the Federal Trade Commission (by means of a request for additional
information or otherwise) shall have been terminated.
5. REGISTRATION RIGHTS. The Company covenants and agrees as
follows:
5.1 CERTAIN ADDITIONAL DEFINITIONS.
As used in this Agreement, the following capitalized terms shall have
the following meanings:
"PROSPECTUS" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement with
respect to the terms of the offering of any portion of the Registrable
Securities covered by such Registration Statement and by all other amendments
and supplements to the prospectus, including post-effective amendments and
all material incorporated by reference in such prospectus.
"REGISTER," "REGISTERED" and "REGISTRATION" refer to a registration
effected by preparing and filing a registration
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statement or similar document in compliance with the 1933 Act, and such
registration statement or document becoming effective under the 1933 Act.
"REGISTRABLE SECURITIES" shall mean (i) the Common Stock of the Company
purchased by the Investor pursuant to this Agreement; and (ii) any Common
Stock of the Company issued as (or issuable upon the conversion or exercise
of any warrant, right or other security which is issued as) a dividend or
other distribution with respect to, or in exchange for or in replacement of,
such Common Stock.
"REGISTRATION STATEMENT" shall mean any registration statement of the
Company that covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such Registration Statement, including post-effective
amendments, all exhibits and all material incorporated by reference in such
Registration Statement.
5.2 REGISTRATION. The Company will use its reasonable best efforts to
effect a registration to permit the sale of the Registrable Securities as
described below, and pursuant thereto the Company will:
(a) prepare and file within one year from the date hereof, and use its
reasonable best efforts to thereafter have declared effective by the SEC, a
Registration Statement on Form S-3 relating to resale of all of the shares of
the Registrable Securities and use its reasonable best efforts to cause such
Registration Statement to remain continuously effective for a period which
will terminate when all Registrable Securities covered by such Registration
Statements, as amended from time to time, have been sold or when the
Registrable Securities may be sold under Rule 144(k) under the 1933 Act.
(b) prepare and file with the SEC such amendments and post-effective
amendments to the Registration Statement and the Prospectus as may be
necessary to keep such Registration Statement effective for the period
specified in Section 5.2(a) and to comply with the provisions of the 1933 Act
and the 1934 Act with respect to the distribution of all Registrable
Securities;
(c) notify Investor promptly, and confirm such notice in writing, (i)
when the Prospectus or any supplement or post-effective amendment has been
filed, and, with respect to the Registration Statement or any post-effective
amendment, when the same has become effective, (ii) of any request by the SEC
for amendments or supplements to the Registration Statement or Prospectus or
for additional information, (iii) of the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose, and (iv) of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any jurisdiction or
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the initiation or threatening of any proceeding for such purpose;
(d) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement at the earliest
possible moment;
(e) furnish to the Investor, without charge, at least one copy of the
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules, all, upon a Investor's request, documents
incorporated therein by reference and all exhibits thereto (including those
incorporated by reference);
(f) deliver to the Investor, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any amendment or
supplement thereto as it may reasonably request in order to facilitate the
disposition of the Registrable Securities;
(g) cause all Registrable Securities covered by the Registration
Statement to be listed on each securities exchange or market on which similar
securities issued by the Company are then listed, and if the securities are
not so listed to use its reasonable best efforts promptly to cause all such
securities to be listed on either the New York Stock Exchange, the American
Stock Exchange or the Nasdaq Stock Market;
(h) use reasonable best efforts to qualify or register the Registrable
Securities for sale under (or obtain exemptions from the application of) the
Blue Sky laws of such jurisdictions as are applicable. The Company shall not
be required to qualify as a foreign corporation or to file a general consent
to service of process in any such jurisdiction where it is not presently
qualified or where it would be subject to general service of process or
taxation as a foreign corporation in any jurisdiction where it is not now so
subject.
(i) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the SEC under the 1933 Act and the 1934
Act and take such other actions as may be reasonably necessary to facilitate
the registration of the Registrable Securities hereunder.
Investor shall furnish to the Company such information regarding the
distribution of such securities as the Company may from time to time
reasonably request in writing.
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If at any time, the Company delivers a certificate in writing to the
Investor, to the effect that a delay in the sale of Registrable Securities by
the Investor under the Registration Statement is necessary because a sale
pursuant to such Registration Statement in its then current form would
reasonably be expected to constitute a violation of the federal securities
laws the Investor shall agree not to sell or otherwise transfer such
Registrable Securities for the period of time specified by the Company in its
certificate. In no event shall such delay exceed ten (10) business days;
PROVIDED, HOWEVER, that if, prior to the expiration of such ten (10) business
day period, the Company delivers a certificate in writing to the Investor to
the effect that a further delay in such sale beyond such ten (10) business
day period is necessary because a sale pursuant to such Registration
Statement in its then current form would reasonably be expected to constitute
a violation of the federal securities laws, the Company may refuse to permit
the Investor to resell any Registrable Securities pursuant to such
Registration Statement for an additional period not to exceed five (5)
business days.
5.3 REGISTRATION EXPENSES. All expenses incident to the Company's
performance of or compliance with this Agreement, including without
limitation all registration and filing fees, fees with respect to the filings
required to be made with the National Association of Securities Dealers,
Inc., fees and expenses of compliance with the securities or blue sky laws,
printing expenses, messenger, telephone and delivery expenses, fees and
disbursements of counsel for the Company, fees and disbursements of all
independent certified public accountants of the Company, fees and expenses
incurred in connection with the listing of the securities, rating agency fees
and the fees and expenses of any person, including special experts, retained
by the Company, will be borne by the Company, regardless of whether the
Registration Statement becomes effective; provided, however, that the Company
will not be required to pay discounts, commissions or fees of underwriters,
selling brokers, dealer managers or similar securities industry professionals
relating to the distribution of the Registrable Securities or fees or
disbursements of any other counsel to the Investor.
5.4 RULE 144.
The Company covenants that it will file the reports required to be
filed by it under the 1933 Act and the 1934 Act and the rules and regulations
thereunder, and it will take such further action as the Investor may
reasonably request, all to the extent required to enable Investor to sell
Registrable Securities without registration under the 1933 Act in reliance on
the exemption provided by Rule 144 or Rule 144A under the 1933 Act or any
successor or similar rules or statues. Upon the request of the Investor, the
Company will deliver to the Investor a written statement as to whether the
Company has complied with such information and requirements.
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MISCELLANEOUS.
6.1 SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective permitted
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto
or their respective successors and assigns any rights, remedies, obligations,
or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.
6.2 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of California (irrespective of its choice of law
principles).
6.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
6.4 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
6.5 NOTICES. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified, or if
sent by telex or telecopier, upon receipt of the correct answerback, or upon
deposit with the United States Post Office, by registered or certified mail,
or upon deposit with an overnight air courier, in each case postage prepaid
and addressed to the party to be notified at the address as follows, or at
such other address as such party may designate by ten days' advance written
notice to the other party:
If to the Company:
Vical Incorporated
0000 Xxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
Attn: Secretary
Fax: (000) 000-0000
with a copy to:
Pillsbury Madison & Sutro LLP
X.X. Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx, Xx.
Fax: (000) 000-0000
If to the Investor:
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Xxxxx Xxxxxxxx, Inc.
c/o Merck & Co., Inc.
Xxx Xxxxx Xxxxx
X.X. Xxx 000, XX0X-00
Xxxxxxxxxx Xxxxxxx, XX 00000-0000
Attn: Senior Director, Corporate Licensing
Fax: 000-000-0000
6.6 FINDERS' FEE. Each party represents that it neither is nor will be
obligated for any finders' fee or commission in connection with this
transaction. Investor agrees to indemnify and hold harmless the Company from
any liability for any commission or compensation in the nature of a finders'
fee (and the costs and expenses of defending against such liability or
asserted liability) for which the Investor or any of its officers, partners,
employees or representatives is responsible.
The Company agrees to indemnify and hold harmless Investor from any
liability for any commission or compensation in the nature of a finders' fee
(and the costs and expenses of defending against such liability or asserted
liability) for which the Company or any of its officers, employees or
representatives is responsible.
6.7 EXPENSES. The Company and the Investor shall pay their respective
costs and expenses incurred with respect to the negotiation, execution,
delivery and performance of this Agreement.
6.8 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the
Investor. Any amendment or waiver effected in accordance with this paragraph
shall be binding upon each holder of any securities purchased under this
Agreement at the time outstanding, each future holder of all such securities,
and the Company.
6.9 SEVERABILITY. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of this Agreement shall be interpreted as
if such provision were so excluded and shall be enforceable in accordance
with its terms.
6.10 ENTIRE AGREEMENT. This Agreement and the Amended License
Agreement constitute the entire agreement between the parties with respect to
the subject matter hereof and thereof and supersede all prior agreements and
understandings, both oral and written, between the parties with respect to
the subject matter hereof and thereof. No representation, inducement,
promise, understanding, condition or warranty not set forth herein or therein
has been made or relied upon by either party hereto. Neither this Agreement
nor any provision hereof is intended to confer upon any Person other
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than the parties hereto any rights or remedies hereunder.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
VICAL INCORPORATED
By /s/ Xxxxx X. Xxxxxxxxx
---------------------------
Title President & C.E.O.
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MERCK HOLDINGS, INC.
By /s/ Xxxxx Xxxxxx
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Title President
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