EXHIBIT 10.1
STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered
into as of March 15, 2004 by and among Neurocrine Biosciences, Inc., a Delaware
corporation (the "Company"), and Wyeth Holdings Corporation (formerly known as
"American Cyanamid Company"), a Maine corporation (the "Investor"). The Investor
and the Company are referred to herein as the "Parties."
W I T N E S S E T H:
WHEREAS, the Investor and the Company have entered into that certain
Assignment and License Agreement dated February 26, 2004 (the "Assignment
Agreement"), which Assignment Agreement provides, inter alia, for the Parties to
enter into this Agreement, pursuant to which the Company will issue to the
Investor shares of its common stock, $.001 par value per share ("Common Stock"),
as partial consideration for the rights and obligations assigned by the Investor
to the Company under Article 2 of the Assignment Agreement and the licenses
granted by the Investor to the Company under Article 3 of the Assignment
Agreement;
WHEREAS, the Company and Investor wish to set forth certain terms
relating to the issuance of the shares of Common Stock.
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein made, and in consideration of the representations, warranties
and covenants herein contained, the Parties agree as follows:
1. AGREEMENT TO ISSUE STOCK.
Subject to the terms and conditions of this Agreement, as
partial consideration for the rights and obligations assigned by the Investor to
the Company under Article 2 of the Assignment Agreement and the licenses granted
by the Investor to the Company under Article 3 of the Assignment Agreement, the
Company shall issue and deliver to the Investor at the Closing (as defined
below) Eight Hundred Two Thousand Nine Hundred Ninety-Eight (802,998) shares of
its Common Stock; provided that if the sum of the aggregate value of such shares
of Common Stock on the Closing Date (as defined below) plus the aggregate value
of any other Common Stock as of the Closing Date held by the Investor or its
Affiliate as of the Closing Date (including without limitation the 4,186 shares
of Common Stock held by the Investor or its Affiliate as of the Signature Date)
plus the aggregate value of any Common Stock as of the Closing Date purchasable
by the Investor or its Affiliate pursuant to any warrant (including without
limitation the 19,950 shares of Common Stock purchasable by the Investor or its
Affiliate under its existing warrant) is equal to or greater than $50,000,000,
the Company will (i) issue to the Investor a number of shares of Common Stock
(rounded down to the next whole share) that, when added to the number of other
shares of Common Stock held by the Investor or its Affiliate as of the Closing
Date plus the number of shares of Common Stock purchasable by the Investor or
its Affiliate pursuant to any warrant as of the Closing Date, is equal to
$49,999,995 divided by the closing sale price of the Company's Common Stock on
the Nasdaq National Market on the trading day immediately prior to the Closing
Date and (ii) pay to the
Investor an amount in cash equal to the difference of the aggregate value of
Eight Hundred Two Thousand Nine Hundred Ninety-Eight (802,998) shares of Common
Stock minus the aggregate value of the number of shares of Common Stock issuable
pursuant to this proviso. For purposes of this Section 1, the value of a number
of shares of the Company's Common Stock as of the Closing Date shall be
calculated by multiplying the number of shares by the closing sale price of the
Company's Common Stock on the Nasdaq National Market on the trading day
immediately prior to the Closing Date. The shares of the Company's Common Stock
to be issued pursuant to this Section 1 are referred to herein as the "Shares."
2. CLOSING.
The issuance and delivery of the Shares (the "Closing") will
take place at the offices of the Investor, 000 Xxxxxx Xxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000, on the date hereof (the "Closing Date").
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby represents and warrants to the Investor
that the statements in the following paragraphs of this Section 3 are true and
correct:
3.1 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. Schedule 3.1 attached hereto sets forth
the name and jurisdiction of organization of each of the Company's subsidiaries
("Subsidiaries"). The Company and each of its Subsidiaries are duly authorized
to conduct business and are in good standing under the laws of each jurisdiction
where such qualification is required, except where the failure to be so
qualified would not have a material adverse effect on the business, properties,
financial condition, operations or results of operations of the Company and its
Subsidiaries, taken as a whole (a "Material Adverse Effect"). Neither the
Company nor any of its Subsidiaries is in default under or in violation of any
provision of its charter or bylaws. The Company has full power and authority to
execute and deliver this Agreement and to perform its obligations hereunder. The
Company and each of the Subsidiaries have full power and authority to carry on
their respective businesses as currently conducted.
3.2 Authorization; Enforceability. All corporate action
on the part of the Company necessary for the authorization, execution and
delivery of this Agreement, the performance of the obligations of the Company at
the Closing, and the issuance and delivery of the Shares has been taken, and
this Agreement has been duly executed and delivered by the Company and
constitutes a legally valid and binding obligation of the Company, enforceable
in accordance with its terms, except as may be limited by (i) applicable
bankruptcy, insolvency, reorganization or other laws of general application
relating to or affecting the enforcement of creditors' rights generally, (ii)
the effect of rules of law governing the availability of equitable remedies and
(iii) the unenforceability under certain circumstances under law or court
decisions of provisions providing for the indemnification of or contribution to
a party with respect to a liability where such indemnification or contribution
is contrary to public policy or prohibited by law.
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3.3 Valid Issuance of Stock. The Shares have been duly
reserved for issuance and, when issued and delivered in accordance with the
terms of this Agreement for the consideration contemplated herein, (i) will be
duly and validly issued, fully paid and nonassessable and will be free of any
taxes, liens or claims (other than those that may be created by the Investor);
(ii) will be free of any restrictions on transfer other than restrictions on
transfer under applicable federal and state securities laws; (iii) will not be
subject to preemptive rights or similar rights of any stockholders of the
Company; and (iv) will be issued in compliance with all applicable federal and
state securities laws. The Shares will have attached thereto rights (the
"Rights") to purchase Series A Participating Preferred Stock. The Rights have
been and will be issued pursuant to an Amended and Restated Preferred Shares
Rights Agreement dated as of January 11, 2002 between the Company and American
Stock Transfer & Trust Company.
3.4 Capitalization. The entire authorized capital stock
of the Company consists of 50,000,000 shares of Common Stock, of which
35,334,440 shares were issued and outstanding as of February 27, 2004, and
5,000,000 shares of preferred stock, $.001 par value per share, none of which
are issued and outstanding as of the date hereof. Except as set forth in SEC
Documents (as defined below) and except as granted in the ordinary course of
business pursuant to the Company's 2003 Incentive Stock Plan since the dates of
the SEC Documents, there are no outstanding or authorized warrants, options,
preemptive rights, purchase rights, subscription rights, conversion rights,
exchange rights, or instruments convertible into or exchangeable for, any
unissued shares of capital stock or other equity interest in the Company, or
other contracts or commitments that could require the Company to issue, sell or
otherwise cause to become outstanding any of its capital stock. There are no
outstanding or authorized stock appreciation, phantom stock, profit
participation or similar rights with respect to the Company. Without limiting
the foregoing, no preemptive right, co-sale right, right of first refusal or
other similar right exists with respect to the issuance and sale of the Shares.
Except as set forth in the SEC Documents, there are no stockholders agreements,
voting trusts, proxies or other agreements or understandings with respect to the
voting of the capital stock of the Company.
3.5 Noncontravention. Neither the execution nor the
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, will (i) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge or other restriction
of any government, governmental agency or court to which the Company is subject,
(ii) violate any provision of the charter or bylaws of the Company (the
"Governing Documents") or (iii) conflict with, result in a breach of, constitute
a default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify or cancel, or require any notice under any
agreement, contract, lease, license, instrument, or other arrangement to which
the Company is a party or by which the Company is bound or to which any of the
Company's assets is subject (or result in the imposition of any mortgage,
pledge, lien, encumbrance, charge or other security interest upon any of such
assets), except in the case of clause (i) or (iii) above, where such violation,
conflict or default would not have a Material Adverse Effect. Except for (i) the
filing of a Form D with the Securities and Exchange Commission (the "SEC") and
(ii) filings which may be required under state securities laws, the Company does
not need to give any notice to, make any filing with, or obtain any
authorization, consent or approval of any government or governmental agency in
order for the Company and the Investor to consummate the transactions
contemplated by this Agreement.
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3.6 Reports Filed under the Securities Exchange Act of
1934; Financial Statements. The Company has timely filed or furnished, as
applicable, all reports required to be filed by the Company under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and the related
certifications required under Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act of
2002. All such reports filed by the Company in the preceding twelve (12) months
(the "SEC Documents") contain all statements required to be stated therein in
accordance with the 1934 Act and the rules and regulations promulgated
thereunder applicable to the SEC Documents, and the SEC Documents do not 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 not
misleading. Any statements made in any such SEC Documents that are or were
required to be updated or amended have been so updated or amended. As of their
respective dates (except as they have been correctly amended), the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such financial statements
have been prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (a) as may be
otherwise indicated in such financial statements or the notes thereto or (b) in
the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present the
financial position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). Except as set forth
in the SEC Documents, the Company has no liabilities, contingent or otherwise,
other than (i) liabilities incurred in the ordinary course of business
subsequent to the date of such SEC Documents, (ii) obligations under contracts
and commitments incurred in the ordinary course of business and not required
under generally accepted accounting principles to be reflected in such SEC
Documents, which liabilities and obligations referred to in clauses (i) and
(ii), individually or in the aggregate, would not have a Material Adverse
Effect, and (iii) contingent liabilities which, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
3.7 Absence of Litigation. Except as disclosed in the SEC
Documents, there is no action, suit, proceeding, inquiry or investigation before
or by any court, public board, government agency, self-regulatory organization
or body pending or, to the knowledge of the Company, threatened against or
affecting the Company, or any of its Subsidiaries, or any of their directors or
officers in their capacities as such which could reasonably be expected to have
a Material Adverse Effect.
3.8 Taxes. The Company has filed all tax returns,
reports, forms, schedules and any other documents ("Tax Returns") required to be
filed by or on behalf of the Company, and all such Tax Returns are accurate and
complete in all material respects. The Company has paid all material taxes
(including interest, penalties, additions to tax or other additional amounts
imposed by any taxing authority) shown to be due on such Tax Returns or
otherwise due, except for such taxes that are being contested in good faith and
for which adequate reserves have been provided.
3.9 No Violations. The Company is not in violation of its
charter, bylaws or other organizational documents, or in violation of any law,
administrative regulation, ordinance
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or order of any court or governmental agency, arbitration panel or authority
applicable to the Company, which violation, individually or in the aggregate,
would be reasonably likely to have a Material Adverse Effect, and is not in
default (and there exists no condition which, with or without the passage of
time or giving of notice or otherwise, would constitute a default) in the
performance of any bond, debenture, note or any other evidence of indebtedness
in any indenture, mortgage, deed of trust or any other agreement or instrument
to which the Company is a party or by which the Company is bound or by which the
property of the Company is bound, which would be reasonably likely to have a
Material Adverse Effect.
3.10 Nasdaq Compliance. The Common Stock is registered
pursuant to Section 12(g) of the 1934 Act, and is listed on the Nasdaq National
Market, and the Company has taken no action designed to, or likely to have the
effect of, terminating the registration of the Common Stock under the 1934 Act
or delisting the Common Stock from the Nasdaq National Market.
3.11 No Manipulation of Stock. The Company has not taken
any action outside the ordinary course of business designed to or that might
reasonably be expected to cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the Shares.
3.12 No General Solicitation. Neither the Company, nor any
of its affiliates, nor any person acting on its or their behalf, has engaged in
any form of general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act of 1933, as amended (the "1933 Act")) in
connection with the offer or sale of the Shares.
3.13 Form S-3 Eligibility. The Company is currently, and
at the Closing Date will be, eligible to register the resale of the Shares on a
registration statement on Form S-3 under the 0000 Xxx. There exist no facts or
circumstances (including without limitation any required approvals or waivers of
any circumstances that may delay or prevent the obtaining of accountant's
consents) that would prohibit or delay the preparation and filing of a
registration statement on Form S-3 with respect to the Shares.
3.14 Rule 144 Availability. The Company has filed the
reports required to be filed by it under the 1934 Act and the rules and
regulations adopted by the SEC thereunder in order to enable the holders of
unregistered Common Stock to sell such Common Stock without registration under
the 1933 Act within the limitation of the exemptions provided by Rule 144 under
the 1933 Act, as such Rule is currently in effect.
4. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.
The Investor represents and warrants to the Company that the
statements in the following paragraphs of this Section 4 are true and correct:
4.1 Organization and Qualification. The Investor is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Maine. The Investor has all requisite corporate power and
authority to enter into and perform this Agreement and to carry out the
transactions contemplated by this Agreement.
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4.2 Authorization. All action on the part of the Investor
necessary for the authorization, execution and delivery of this Agreement and
the performance of all obligations of the Investor hereunder has been taken, and
this Agreement has been duly executed and delivered by the Investor and
constitutes a legally valid and binding obligation of the Investor, enforceable
in accordance with its terms, except as may be limited by (i) applicable
bankruptcy, insolvency, reorganization or other laws of general application
relating to or affecting the enforcement of creditors' rights generally, (ii)
the effect of rules of law governing the availability of equitable remedies and
(iii) the unenforceability under certain circumstances under law or court
decisions of provisions providing for the indemnification of or contribution to
a party with respect to a liability where such indemnification or contribution
is contrary to public policy or prohibited by law.
4.3 Purchase for Own Account. The Shares to be purchased
by the Investor hereunder will be acquired for investment for the Investor's own
account, not as a nominee or agent, and not with a view to the public
distribution thereof within the meaning of the 1933 Act, and the Investor has no
present intention of selling or otherwise distributing the same, except in
compliance with the requirements of, or pursuant to a valid exemption from, such
Act. The Investor does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to the Shares. The Investor also
represents that it has not been formed for the specific purpose of acquiring the
Shares.
4.4 Accredited Investor Status. The Investor is an
"accredited investor" within the meaning of Regulation D promulgated under the
1933 Act. By reason of its business and financial experience, sophistication and
knowledge, the Investor is capable of evaluating the risks and merits of the
investment made pursuant to this Agreement. The Investor confirms that it is
able (i) to bear the economic risk of this investment, (ii) to hold the Shares
for an indefinite period of time, and (iii) to bear a complete loss of the
Investor's investment; and the Investor represents that it has sufficient liquid
assets so that the illiquidity associated with this investment will not cause
any undue financial difficulties or affect the Investor's ability to provide for
its current needs and possible financial contingencies.
4.5 Restricted Securities. The Investor understands that
the Shares are characterized as "restricted securities" under the 1933 Act
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under the 1933 Act and applicable
regulations thereunder such securities may be resold without registration under
the 1933 Act only in certain limited circumstances. In this connection, the
Investor represents that it is familiar with SEC Rule 144, as presently in
effect, and understands the resale limitations imposed thereby and by the 1933
Act. The Investor understands that the Company is under no obligation to
register any of the securities sold hereunder, except as provided in Section 7
below.
4.6 Due Diligence and No Solicitation. The Investor has
had a reasonable opportunity to conduct due diligence and to ask questions of
and receive answers from the Company and its officers. At no time was the
Investor presented with or solicited by any leaflet, public promotional meeting,
circular, newspaper or magazine article, radio or television advertisement or
any other form of general advertising. Neither such inquiries nor any other due
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diligence investigation conducted by Investor or its counsel or any of its
representatives shall modify or affect Investor's right to rely on the Company's
representations and warranties in this Agreement.
4.7 Further Limitations on Disposition. The Investor
further agrees not to make any disposition of all or any portion of the Shares
unless and until:
(a) there is then in effect a registration
statement under the 1933 Act covering such proposed disposition and such
disposition is made in accordance with such registration statement; or
(b) (i) the Investor shall have notified the
Company of the proposed disposition and shall have furnished the Company with a
statement of the circumstances surrounding the proposed disposition, which in
the case of a sale to be made pursuant to Rule 144 shall be limited to customary
representations regarding compliance with the requirements of Rule 144 regarding
volume, manner of sale and other matters, and (ii) the Investor shall have
furnished the Company at the Investor's expense an opinion of in house or
outside counsel (as determined by the Investor), reasonably satisfactory to the
Company that such disposition will not require registration of such securities
under the 1933 Act; provided that the Company shall not require an opinion of
counsel for routine sales of shares pursuant to Rule 144 or any sale of shares
pursuant to Rule 144(k).
Notwithstanding the foregoing provisions of this Section 4.7
or any other provision of this Article 4 or this Agreement, the Parties
acknowledge and agree that the Investor may contribute or otherwise transfer the
Shares without consideration to a corporation that is the direct or indirect
parent of the Investor or to any subsidiary of the Investor or such corporate
parent.
4.8 Legends. It is understood that the certificates
evidencing the Shares will bear the legends set forth below:
(a) THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
(b) Any legend required by the laws of the State
of California, including any legend required by the California Department of
Corporations.
The legend set forth above shall be removed and the Company shall issue a
certificate without such legend to the holder of Shares upon which it is
stamped, if (a) the Shares represented by such certificate have been sold
pursuant to an effective registration statement under the 1933 Act or (b) in
connection with the resale of such Shares, such holder provides the Company with
an opinion of in house or outside counsel (as determined by the Investor), in
form, substance and
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scope customary for opinions of counsel in comparable transactions, to the
effect that a public sale or transfer of such Security may be made without
registration under the 1933 Act or (c) such holder provides the Company with
reasonable assurances that such Shares have been sold under Rule 144 or can be
sold under Rule 144(k).
5. COVENANTS.
The Company and the Investor agree as follows:
5.1 Form D. The Company agrees to file a notice of sale
on Form D with respect to the Shares as required under Regulation D promulgated
under the 1933 Act and to provide a copy thereof to Investor promptly after such
filing.
5.2 No Integrated Offerings. The Company shall not make
any offers or sales of any security (other than the Shares) under circumstances
that would require registration of the Shares being offered or sold hereunder
under the 1933 Act or cause this offering of Shares to be integrated with any
other offering of securities by the Company.
5.3 Transfer Taxes. On the Closing Date, all stock
transfer or other taxes (other than income taxes) which are required to be paid
in connection with the sale and transfer of the Shares to be sold to the
Investor hereunder will be, or will have been, fully paid or provided for by the
Company and all laws imposing such taxes will be or will have been fully
complied with.
6. DELIVERIES BY THE COMPANY AT CLOSING.
At the Closing, the Company shall deliver, or cause to be
delivered, to the Investor the following:
6.1 Stock Certificate. A certificate representing the
Shares.
6.2 Opinion of Company Counsel The Investor shall have
received a customary opinion of Xxxxxx & Xxxxxxx LLP, outside counsel to the
Company, with respect to the matters set forth on Exhibit A and a customary
legal opinion of Xxxxxxxx X. Valeur-Xxxxxx, Esq., the Company's General Counsel,
addressed to the Investor with respect to the matters set forth on Exhibit B.
7. REGISTRATION STATEMENT FOR RESALE OF THE SHARES.
7.1 Demand Registration Rights. As promptly as
practicable but in no event later than thirty (30) days after the receipt of a
written request from the Investor that the Company effect any registration under
the 1933 Act on SEC Form S-3 (or any successor form to Form S-3 regardless of
its designation) at a time when the Company is eligible to register securities
on Form S-3 (or any successor form to Form S-3 regardless of its designation),
the Company will prepare and file with the SEC a registration statement on Form
S-3 (or any successor form to Form S-3 regardless of its designation)
registering all of the Shares sold to the Investor pursuant to this Agreement
for resale to the public by the Investor pursuant to such
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registration statement (the "Shelf Registration Statement") and the prospectus
included therein, free and clear of any restrictions under the 1933 Act except
for prospectus delivery requirements. For purposes of this Section 7, the term
"Shares" shall be deemed to include shares of Common Stock issued as a dividend
or other distribution with respect to or in replacement of the Shares. The
Company shall use its reasonable best efforts to cause the Shelf Registration
Statement to become effective as promptly as practicable thereafter and, subject
to Sections 7.3(c), to remain effective until the earlier of (i) ninety (90)
days from the effective date and (ii) such time as the Investor has sold all of
the Shares (the "Registration Period"). Notwithstanding the foregoing, (1) the
Company shall have no obligation to prepare and file, or maintain the
effectiveness of, a Shelf Registration Statement at any time that the Investor
may sell all or any portion of the Shares pursuant to SEC Rule 144(k); (2) the
Company shall have the right to defer the filing of a Shelf Registration
Statement for a period of not more than sixty (60) days from delivery of the
request of the Investor if within seven (7) days from delivery of such request
the Company notifies the Investor of the Company's intention to make a public
offering within sixty (60) days or the Company notifies the Investor that, in
the good faith determination of the Board of Directors of the Company, it would
be seriously detrimental to the Company for any registration to be effected as
requested under this Section 7.1; provided, however, that the Company may not
utilize this right more than once; and (3) the Company shall have no obligation
to enter into an underwriting agreement relating to, or otherwise facilitate, an
underwritten sale of the Shares pursuant to the Shelf Registration Statement.
7.2 Piggyback Registration Rights.
(a) Right to Piggyback. If, at any time during
the period commencing upon the Closing Date and ending upon the one-year
anniversary of the Closing Date, the Company proposes to register any shares of
Common Stock with the SEC under the 1933 Act in connection with the underwritten
public offering of such shares, and the registration form to be used may be used
for the registration of the Shares (a "Piggyback Registration"), the Company (1)
will give written notice (the "Piggyback Notice") to the Investor no later than
ten (10) days prior to the anticipated filing date of its intention to effect
such a registration, which Piggyback Notice will specify the kind and number of
securities proposed to be registered, the distribution arrangements and such
other information that at the time would be appropriate to include in such
notice, and (2) will, subject to Section 7.2(b), include in such Piggyback
Registration all Shares with respect to which the Company has received written
requests for inclusion therein within five (5) days after the date of the
Piggyback Notice. Subject to Section 7.2(b), such Shares shall be included in
the underwriting on the same terms and conditions as the securities otherwise
being sold through the underwriters. The Investor's right to registration of any
Shares pursuant to this Section 7.2 shall be conditioned on the inclusion of
such Shares in such underwriting, and the Investor shall have no right to
participate in the selection of the underwriters for such offering.
(b) Priority on Piggyback Registrations. If the
managing underwriter or underwriters in any Piggyback Registration advise the
Company that in its or their reasonable good faith opinion the number or kind of
securities proposed to be sold in such registration (including Shares to be
included pursuant to Section 7.2(a)) is inconsistent with that which can be sold
in such registration without having a material adverse effect on the success of
the offering, the Company will include in such registration the number of
securities, if any, which, in
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the opinion of such underwriter or underwriters can be sold, in the following
order of priority: (1) first, the shares the Company proposes to sell for its
own account, (2) second, the Shares requested to be included in such
registration by the Investor and other holders of similar piggyback registration
rights, and (3) third, any securities held by any other persons to be included
in such Piggyback Registration.
7.3 Company Obligations. In connection with the
registration of the Shares pursuant to this Section 7, the Company shall do the
following:
(a) Prepare and deliver to the Investor as many
copies of the Prospectus (as hereafter defined) as the Investor may reasonably
request;
(b) With respect to the Shelf Registration
Statement contemplated by Section 7.1, use its reasonable best efforts to comply
with all requirements imposed upon it by the 1933 Act, by the 1934 Act and by
the undertakings in the Shelf Registration Statement, so far as is necessary to
permit the continuance of resales of the Shares by the Investor to the public,
free and clear of any restrictions under the 1933 Act except for prospectus
delivery requirements;
(c) If an event shall occur which makes it
necessary to amend or supplement any registration statement filed pursuant to
this Section 7 (any such registration statement, including the Shelf
Registration Statement, the "Registration Statement") or the Prospectus to
comply with law or with the rules and regulations of the SEC, the Company shall
promptly notify the Investor of the proposed amendment or supplement and
promptly prepare and furnish to the Investor such number of copies of an amended
or supplemented Registration Statement and/or Prospectus that complies with law
and with such rules and regulations as the Investor may reasonably request. The
Investor shall suspend its sales of the Shares pending the preparation and
delivery of such amendment or supplement and until such time as each such
amendment or amendments to the Registration Statement have been declared
effective by the SEC. The Company authorizes the Investor, and any brokers or
dealers effecting sales of the Shares for the account of the Investor, to use
the Prospectus, as from time to time amended or supplemented, in connection with
the sale of the Shares in accordance with applicable provisions of the 1933 Act
and state securities laws. For purposes of this Agreement, the term "Prospectus"
means the final prospectus relating to the Shares most recently included in the
Registration Statement or filed by the Company pursuant to Rule 424 of the 1933
Act and any amendments or supplements thereto filed by the Company pursuant to
Rule 424 of the 1933 Act and shall include all documents or information
incorporated in any such prospectus by reference;
(d) Promptly advise the Investor (i) when any
post-effective amendment of the Registration Statement is filed with the SEC and
when any post-effective amendment becomes effective; (ii) of any request made by
the SEC for any amendment of or supplement to the Registration Statement or the
Prospectus or for additional information relating thereto; (iii) of any
suspension or threatened suspension of the use of any Prospectus in any state;
and (iv) of any proceedings commenced or threatened to be commenced by the SEC
or any state securities commission that would result in the issuance of any stop
order or other order or suspension of use. The Company agrees to use its
reasonable best efforts to prevent or promptly remove any stop order or other
order preventing or suspending the use of the Prospectus during any period
during which the Company has an obligation to maintain the effectiveness of a
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Registration Statement filed pursuant to this Section 7 (the "Resale Period")
and to comply with any such request by the SEC to amend or supplement the
Prospectus;
(e) Take such action as shall be necessary to
qualify and maintain the qualification of the Shares covered by such
registration under such state securities or "blue sky" laws for offers and sales
to the public during the Resale Period as the Investor shall reasonably request;
provided, however, that the Company shall not be obligated to qualify as a
foreign corporation to do business under the laws of or become subject to
taxation in, any jurisdiction in which it shall not be then qualified, or to
file any general consent to service of process;
(f) Provide a transfer agent and registrar,
which may be a single entity, for the Shares not later than the effective date
of the Registration Statement;
(g) Prepare and file with the SEC, at the
request of the Investor, such amendments (including post-effective amendments)
and supplements to a Shelf Registration Statement and the prospectus used in
connection therewith as may be reasonably necessary or appropriate to change the
plan of distribution set forth in the Shelf Registration Statement; and
(h) Cause the Common Stock to be registered
pursuant to Section 12(b) or 12(g) of the 1934 Act and continually quoted or
listed, subject to notice of issuance, on the Nasdaq National Market or a
national securities exchange, if such exchange is the principal market on which
the Common Stock is traded, and not subject to any restriction or suspension
from trading on the Nasdaq National Market or such national securities exchange;
provided, however, that the Company may deregister the Common Stock registered
pursuant to Section 12(b) or 12(g) of the 1934 Act if such deregistration is in
connection with a merger, dissolution or other transaction in which the
stockholders of the Company receive prior to such deregistration either cash or
securities that are listed on the Nasdaq National Market or a national
securities exchange or some combination of cash and such securities; provided,
further, that the Company may delist the Common Stock from trading on the Nasdaq
National Market or national securities exchange if the Company is concurrently
listing such stock on the New York Stock Exchange or the American Stock
Exchange.
(i) With a view to making available to the
Investor the benefits of certain rules and regulations of the SEC that at any
time permit the sale of the Shares to the public without registration, the
Company agrees to:
(A) make and keep public information
available, as those terms are understood and defined in Rule 144 under the 1933
Act;
(B) file with the SEC in a timely
manner all reports and other documents required of the Company under the 1934
Act; and
(C) so long as the Investor owns any
unregistered Shares, furnish to the Investor upon any reasonable request a
written statement by the Company as to its compliance with the public
information requirements of Rule 144 under the 1933 Act, and of the 1934 Act, a
copy of the most recent annual or quarterly report of the Company, and the other
SEC reports and documents of the Company as the Investor may reasonably request
in availing
11
itself of any rule or regulation of the SEC allowing an Investor to sell any
Shares without registration (excluding any reports or documents of the Company
that the Company, in its sole discretion, deems confidential).
7.4 Restrictions on Registrations. If at any time or from
time to time after the effective date of the Registration Statement, the Company
notifies the Investor in writing of the existence of a Material Event (as
defined below), the Investor shall not offer or sell any Shares or engage in any
other transaction involving or relating to Shares from the time of the giving of
notice with respect to a Material Event until the Investor receives written
notice from the Company that such Material Event either has been disclosed to
the public or no longer constitutes a Material Event. "Material Event" means any
of the following: (i) the possession by the Company of material information not
ripe for disclosure in the Registration Statement, as determined in good faith
by the Board of Directors of the Company that disclosure of such information in
the Registration Statement at such time would be seriously detrimental to the
business and affairs of the Company; or (ii) any material engagement or activity
by the Company which would, in the good faith determination of the Board of
Directors of the Company, be seriously adversely affected by disclosure in the
Registration Statement at such time, which determination shall be accompanied by
a good faith determination by the Board of Directors of the Company that the
Registration Statement would be materially misleading absent the inclusion of
such information. In no event shall the suspension of the Registration Statement
(or the permissible delay in filing the Registration Statement) exceed sixty
(60) days as a result of a Material Event.
7.5 Certain Obligations of Investor. In connection with
the registration of the Shares pursuant to this Section 7:
(a) The Investor shall cooperate as reasonably
requested by the Company with the Company in connection with the preparation of
the Registration Statement, and for so long as the Company is obligated to file
and keep effective the Registration Statement, shall provide to the Company, in
writing, for use in the Registration Statement, all such information regarding
such Investor and its plan of distribution of the Shares as may be required to
enable the Company to prepare the Registration Statement and the Prospectus, to
maintain the currency and effectiveness thereof and otherwise to comply with all
applicable requirements of law in connection therewith.
(b) The Investor agrees to promptly furnish
additional information required to be disclosed in order to make the information
previously furnished to the Company by the Investor not materially misleading.
The Investor agrees to furnish all such information and to cooperate with and
provide assistance to the Company, as the Company may reasonably request, in
connection with any registration and sale of the Shares.
(c) The Investor hereby covenants with the
Company not to make any sale of the Shares without effectively causing the
prospectus delivery requirements under the 1933 Act to be satisfied unless the
sale is made pursuant to an exemption from registration.
(d) The Investor acknowledges and agrees that
the Shares sold pursuant to the Registration Statement are not transferable on
the books of the Company unless
12
the stock certificate submitted to the transfer agent evidencing the Shares is
accompanied by a certificate reasonably satisfactory to the Company to the
effect that (i) the Shares have been sold in accordance with this Agreement and
the Registration Statement and (ii) the requirement of delivering a current
prospectus has been satisfied.
(e) The Investor is hereby advised that the
anti-manipulation provisions of Regulation M under the 1934 Act may apply to
sales of the Shares offered pursuant to the Registration Statement and agrees
not to take any action with respect to any distribution deemed to be made
pursuant to the Registration Statement that constitutes a violation of
Regulation M under the 1934 Act or any other applicable rule, regulation or law.
(f) At the end of the Registration Period, the
Investor shall discontinue sales of Shares pursuant to the Shelf Registration
Statement upon receipt of notice from the Company of its intention to remove
from registration the Shares covered thereby which remain unsold, and the
Investor shall promptly notify the Company of the number of Shares registered
that remain unsold immediately upon receipt of the notice from the Company.
7.6 Indemnification of the Investor. The Company shall
indemnify, defend and hold harmless the Investor, its officers and its directors
and any controlling persons of the Investor against and in respect of any
losses, claims, damages or liabilities, joint or several (including legal or
other fees and expenses reasonably incurred by any of them in connection with
investigating or defending any such loss, claim, damage or liability) to which
the Investor or any such persons may become subject under the 1933 Act or
otherwise insofar as such losses, claims, damages or liabilities (or actions
with respect thereto) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement or Prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except to the extent
that any such untrue statement or omission is based upon written information
supplied by the Investor or by any of its representatives for use specifically
in such Registration Statement; provided, however, this indemnity agreement
shall not inure to the benefit of the Investor to the extent any loss, claim,
damage, liability or action arising from the sale of the Shares to any person
results from the Investor failing to send or give a copy of the Prospectus (as
amended or supplemented) to such person.
7.7 Indemnification of the Company. The Investor shall
indemnify, defend and hold harmless the Company, its officers and its directors
and any controlling persons of the Company against and in respect of any losses,
claims, damages or liabilities, joint or several (including legal or other fees
and expenses reasonably incurred by any of them in connection with investigating
or defending any such loss, claim, damage or liability) to which the Company or
any such persons may become subject under the 1933 Act or otherwise insofar as
such losses, claims, damages or liabilities (or actions with respect thereto)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only in each case to the extent that any such untrue statement
or omission is based upon written information supplied by the Investor or its
representatives for use specifically
13
in such Registration Statement; provided that in no event shall any
indemnification obligation on the part of the Investor under this Section 7.7
exceed the net proceeds from the offering received by the Investor.
7.8 Contribution. If for any reason the indemnification
provided for in the preceding Sections 7.6 or 7.7 is unavailable to an
indemnified party as contemplated by such clauses, then the indemnifying party
shall contribute to the amount paid or payable by the indemnified party as a
result of such loss, claim, damage or liability in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnified party and the indemnifying party, but also the relative fault of the
indemnified party and the indemnifying party, as well as any other relevant
equitable considerations; provided that in no event shall any contribution
obligation on the part of the Investor under this Section 7.8 exceed the net
proceeds from the offering received by the Investor.
7.9 Procedure for Indemnification. The procedure for
indemnification under this Section 7 shall be as follows:
(a) Notice. The indemnified party shall promptly
give notice to the indemnifying party of any pending or threatened claim giving
rise to indemnification under Sections 7.6 or 7.7 (a "Claim"), specifying the
factual basis for the Claim and the approximate amount thereof.
(b) Control of Claim and Settlement. With
respect to any Claim as to which a person is entitled to indemnification
hereunder, the indemnifying party shall have the right at its own expense to
participate in or assume control of the defense of the Claim, and the
indemnified party shall reasonably cooperate with the indemnifying party,
subject to reimbursement for actual out-of-pocket expenses incurred by the
indemnified party as the result of a request by the indemnifying party;
provided, however, that such indemnifying party shall not be entitled to assume
such defense and an indemnified party shall have the right to retain its own
counsel with the reasonable fees and expenses to be paid by the indemnifying
party, if, in the reasonable opinion of counsel retained by the indemnifying
party, the representation by such counsel of the indemnified party and the
indemnifying party would be inappropriate due to actual or potential conflicts
of interest between such indemnified party and any other party represented by
such counsel in such proceeding or the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and any such indemnified party reasonably determines that
there may be legal defenses available to such indemnified party which are in
conflict with those available to such indemnifying party. If the indemnifying
party elects to assume control of the defense of any Claim, the indemnified
party shall have the right to participate in the defense of the Claim at its own
expense. If the indemnifying party does not elect to assume control or otherwise
participate in the defense of any Claim, it shall be bound by the results
obtained by the indemnified party with respect to the Claim. No indemnifying
party shall be liable for any settlement effected without its written consent,
not to be unreasonably withheld or delayed.
(c) Survival. Notwithstanding any other
provision of this Agreement, the indemnification and contribution obligations of
the parties hereunder shall survive indefinitely.
14
7.10 Expenses. The Company shall pay all expenses incident
to the registration of the Shares under this Section 7, including without
limitation, all registration and filing fees, all fees and expenses of complying
with securities or blue sky laws, all word processing, duplicating and printing
expenses, and the fees and disbursements of counsel for the Company and its
independent public accountants. With respect to sales of the Shares, the
Investor shall pay all underwriting discounts and commissions and fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals relating to any resale of the Shares by the Investor, and transfer
taxes, if any.
7.11 Compliance. The Investor will observe and comply with
the 1933 Act, the 1934 Act and the general rules and regulations thereunder, as
now in effect and as from time to time amended and including those hereafter
enacted or promulgated, in connection with any offer, sale, pledge, transfer or
other disposition of the Shares or any part thereof.
8. MISCELLANEOUS.
8.1 Survival of Warranties. The representations and
warranties of the Company and the Investor contained in or made pursuant to this
Agreement shall survive the execution and delivery of this Agreement, the
Closing and the delivery to the Investor of the Shares and shall in no way be
affected by any investigation of the subject matter thereof made by or on behalf
of the Investor or the Company, as the case may be; provided, however, that (a)
the representations and warranties in Sections 3.1, 3.2, 3.3, 4.1 and 4.2 shall
survive without limitation to time, (b) the representations and warranties set
forth in Section 3.8 shall survive until fifteen (15) months after the Closing
Date and (c) all other representations and warranties in Articles 3 and 4 shall
survive until one (1) year after the Closing Date. The covenants of the Company
and the Investor contained in or made pursuant to this Agreement shall survive
the execution and delivery of this Agreement, the Closing and the delivery to
the Investor of the Shares and shall survive indefinitely.
8.2 Successors and Assigns. This Agreement shall bind and
inure to the benefit of the Company and the Investor and their respective
successors and permitted assigns; provided that the Company may not assign its
rights or obligations under this Agreement to any person without the prior
written consent of the Investor; provided, further, that the Investor may not
assign its rights or obligations under this Agreement to any person (other than
an affiliate) without the prior written consent of the Company. For the
avoidance of doubt, the Parties agree that the Investor may contribute or
otherwise transfer the Shares to any affiliate.
8.3 Applicable Law. This Agreement is governed by, and
shall be construed in accordance with, the laws of the State of California,
United States of America.
8.4 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.
8.5 Headings. The headings and captions used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement. All references in this Agreement to
sections, paragraphs, exhibits and schedules shall, unless
15
otherwise provided, refer to sections and paragraphs hereof and exhibits and
schedules attached hereto, all of which exhibits and schedules are incorporated
herein by this reference.
8.6 Notices. All notices, requests, demands, claims and
other communications hereunder will be in writing. Any notice, request, demand,
claim or other communication hereunder shall be deemed duly given if (within two
business days) it is sent by registered or certified mail, return receipt
requested, postage prepaid and addressed to the intended recipient as set forth
below:
To the Company: Neurocrine Biosciences, Inc.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Attention: Xxxxxxxx Valeur-Xxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to: Xxxxxx & Xxxxxxx LLP
00000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To the Investor: Wyeth Holdings Corporation
000 Xxxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Attention: Senior Vice President, Worldwide
Licensing
Facsimile: (000) 000-0000
with a copy to: Wyeth
0 Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
Any Party may send any notice, request, demand, claim or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service
or ordinary mail), but no such notice, request, demand, claim or other
communication shall be deemed to have been duly given unless and until it
actually is received by the intended recipient. Any Party may change the address
to which notices, requests, demands, claims and other communications hereunder
are to be delivered by giving the other Parties notice in the manner herein set
forth.
8.7 No Finder's Fees. Each of the Company and the
Investor represents that it neither is nor will be obligated for any finder's or
broker's fee or commission in connection with this transaction. The Company
agrees to indemnify and hold harmless the Investor from any
16
liability for any commission or compensation in the nature of a finder's or
broker's fee (and any asserted liability) for which the Company or any of its
officers, employees or representatives is responsible.
8.8 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.
8.9 Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision(s)
shall be excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision(s) were so excluded and shall be enforceable in
accordance with its terms.
8.10 Entire Agreement. This Agreement, together with all
exhibits and schedules hereto, constitutes the entire agreement and
understanding of the parties with respect to the subject matter hereof and
supersedes any and all prior negotiations, correspondence, agreements,
understandings, duties or obligations between the parties with respect to the
subject matter hereof.
8.11 Public Announcements. The Investor and the Company
shall use reasonable efforts to consult with each other before issuing any press
release with respect to this Agreement or the transactions contemplated hereby
and neither shall issue any such press release or make any such public statement
without the prior consent of the other, which consent shall not be unreasonably
withheld or delayed; provided, however, that a Party may, without the prior
consent of the other Party, issue such press release or make such public
statement as may upon the advice of counsel be required by law if it has used
reasonable efforts to consult with the other Party prior thereto. The Investor
hereby consents to the filing of this Agreement by the Company with the SEC.
8.12 Further Assurances. From and after the date of this
Agreement, upon the request of the Investor or the Company, the Company and the
Investor shall execute and deliver such instruments, documents or other writings
as may be reasonably necessary or desirable to confirm and carry out and to
effectuate fully the intent and purposes of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
17
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
THE COMPANY:
NEUROCRINE BIOSCIENCES, INC.
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: EVP & CFO
THE INVESTOR:
WYETH HOLDINGS CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President
EXHIBIT A
FORM OF OPINION OF XXXXXX & XXXXXXX
1. The Company is a corporation under the General Corporation Law
of the State of Delaware, with corporate power and authority to own its
properties and to conduct its business as described in the SEC Documents. Based
on certificates from public officials, we confirm that the Company is validly
existing and in good standing under the laws of the State of Delaware and is
qualified to do business in the State of California.
2. The authorized capital stock of the Company consists of (a)
50,000,000 shares of Common Stock, and (b) 5,000,000 shares of preferred stock,
par value $0.001 per share. The Shares have been duly authorized by all
necessary corporate action of the Company and, when issued to you in accordance
with the terms of the Purchase Agreement, will be validly issued, fully paid and
nonassessable and free of preemptive rights arising from the Governing
Documents.
3. The execution, delivery and performance of the Purchase
Agreement have been duly authorized by all necessary corporate action of the
Company, and the Purchase Agreement has been duly executed and delivered by the
Company. The Purchase Agreement constitutes a legally valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms.
4. The execution and delivery of the Purchase Agreement and the
issuance and sale of the Shares by the Company to you pursuant to the Purchase
Agreement on the date hereof do not:
(a) violate the Company's Governing Documents;
(b) violate any federal or California statute, rule or
regulation applicable to the Company; or
(c) require any consents, approvals or authorizations to
be obtained by the Company, or any registrations,
declarations or filings to be made by the Company, in
each case, under any federal or California statute,
rule or regulation applicable to the Company, except
such that have been obtained under the Securities Act
and such that may be required under state securities
laws.
5. Assuming the accuracy of the representations in Section 4 of
the Purchase Agreement, no registration of the Shares under the Securities Act
of 1933, as amended (the "Securities Act"), is required in connection with the
issuance of the Shares to the Investor in the manner contemplated by the
Purchase Agreement.
The opinions expressed in paragraph 3 shall be further subject to the
following limitations, qualifications and exceptions:
1
(a) the effect of bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium or other similar laws relating to or
affecting the rights or remedies of creditors;
(b) the effects of general principles of equity, whether
considered in a proceeding in equity or at law (including the possible
unavailability of specific performance or injunctive relief), concepts
of materiality, reasonableness, good faith and fair dealing, and the
discretion of the court before which a proceeding is brought;
(c) the unenforceability under certain circumstances
under law or court decisions of provisions for the indemnification of
or contribution to a party with respect to a liability where such
indemnification or contribution is contrary to public policy;
(d) certain rights, remedies and waivers contained in the
Purchase Agreement may be limited or rendered ineffective by applicable
California laws or judicial decisions governing such provisions, but
such laws or judicial decisions do not render the Purchase Agreement
invalid or unenforceable as a whole; and
(e) such counsel calls to your attention the provisions
of Sections 1717 and 1717.5 of the California Civil Code, which limit
and create obligations for the payment of attorney's fees.
Our opinions set forth in paragraph 4 are based upon our consideration
of only those statutes, rules and regulations which, in our experience, are
normally applicable to private placements of common equity securities. We
express no opinion in paragraph 4 as to the application of laws which by custom
are understood to be excluded from such opinions and identified in Section 19 of
the Legal Opinion Accord of the Section of Business Law of the American Bar
Association (1991). Without limiting the foregoing, we express no opinion in
paragraph 4 as to the application of Section 548 of the federal Bankruptcy Code
and comparable provisions of state law, federal securities laws (certain aspects
of which are addressed elsewhere herein), state securities laws, antifraud laws,
antitrust or trade regulation laws, the Hatch/Waxman Patent Term Extension Act
and the other patent laws of the United States or the rules and regulations of
the U.S. Patent and Trademark Office, the Federal Food, Drug and Cosmetic Act,
the Public Health Service Act, the Food and Drug Administration Modernization
Act, the Orphan Drug Act or the rules and regulations of the Federal Food and
Drug Administration, or any other federal or California laws pertaining to the
regulation of the development, testing, manufacture or sale of drugs.
2
EXHIBIT B
FORM OF GENERAL COUNSEL OPINION
1. To my knowledge, the issuance and sale of the Shares by the
Company pursuant to the Stock Purchase Agreement will not result in the breach
of or a default under (i) any order, writ or decree of any court or governmental
agency having jurisdiction over the Company or the Subsidiaries or over any of
their respective properties or operations or (ii) any of the agreements listed
on Annex I hereto.
2. To my knowledge, there are no legal or governmental
proceedings pending or threatened against the Company of a character required to
be disclosed in an Annual Report on Form 10-K or Quarterly Report on Form 10-Q
by the Securities Exchange Act of 1934, as amended, other than those described
in the SEC Documents, except for such proceedings as, if the subject of an
unfavorable decision, would not individually or in the aggregate result in a
material adverse change in the earnings, business, management, properties,
assets, operations, condition (financial or otherwise) or prospects of the
Company and its subsidiaries, taken as a whole, or prevent the consummation of
the transactions contemplated by the Purchase Agreement.
3
