EXHIBIT 99.2
EXECUTION COPY
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this "AGREEMENT") is made
and effective as of December 31, 2002 by and among EntreMed, Inc., a Delaware
corporation (the "COMPANY"), and Celgene Corporation, a Delaware corporation
(the "PURCHASER").
WHEREAS, subject to the terms and conditions set forth in this
Agreement, the Company desires to sell to the Purchaser and the Purchaser
desires to purchase from the Company Three Million Three Hundred Fifty Thousand
(3,350,000) shares of the Company's Series A convertible preferred stock, $1.00
par value per share (the "SERIES A STOCK"), and, as an inducement to the
Purchaser to purchase the Series A Stock, the Company desires to issue to the
Purchaser, and the Purchaser desires to acquire from the Company, a warrant to
purchase Seven Million (7,000,000) shares of the Company's common stock, par
value $0.01 per share ("COMMON STOCK"), in the form of Exhibit A hereto (the
"WARRANT"), as more fully set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
contained in this Agreement and for other good and valuable consideration the
receipt and adequacy of which are hereby acknowledged, the Company and the
Purchaser agree as follows:
1. CLOSING.
(a) The closing of the sale of the securities contemplated
hereby (the "CLOSING") shall take place at the offices of Proskauer Rose LLP
("PURCHASER COUNSEL"), 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the date
hereof, or on such date or location as the parties shall otherwise agree. The
date of the Closing is hereinafter referred to as the "CLOSING DATE." At the
Closing: (x) the Company shall issue and deliver to the Purchaser (i) a stock
certificate, registered in the name of the Purchaser and free of all restrictive
legends, representing Three Million Three Hundred Fifty Thousand (3,350,000)
shares of Series A Stock (the shares of Series A Stock issued and sold to the
Purchaser hereunder are sometimes collectively referred to herein as the
"SHARES"), (ii) the Warrant, registered in the name of the Purchaser, pursuant
to which the Purchaser shall have the right to acquire Seven Million (7,000,000)
shares of Common Stock, on the terms set forth therein (the shares of Common
Stock issuable upon exercise of the Warrant and upon conversion of the Shares
are sometimes collectively referred to herein as the "UNDERLYING SHARES;" and
the Shares, the Warrant and the Underlying Shares are sometimes collectively
referred to herein as the "Securities"), (iii) a prospectus supplement with
respect to the Registration Statement (as defined in Section 2(c)) reflecting
the sale of the Shares and the Underlying Shares (the "SUPPLEMENT"), (iv) an
investor and registration rights agreement in the form of Exhibit C attached
hereto (the "INVESTOR AND REGISTRATION RIGHTS AGREEMENT"), and (v) any other
documents reasonably requested by the Purchaser or Purchaser Counsel; and (y)
the Purchaser shall deliver to the Company Sixteen Million Seven Hundred Fifty
Thousand Dollars ($16,750,000), representing the aggregate purchase price for
the Shares, in immediately available funds by wire transfer to an account
designated in writing by the Company for such purpose.
(b) The obligation of the Purchaser to purchase and acquire
the Shares and Warrant under this Agreement is subject to the fulfillment (or
waiver by the Purchaser) of each of the following conditions:
(i) The Company shall have adopted and filed with the
Secretary of State of the State of Delaware a Certificate of
Designation of Series A Convertible Preferred Stock in the
form of Exhibit B hereto (the "CERTIFICATE") and the
Certificate shall be in full force and effect;
(ii) The Registration Statement shall be effective on
the Closing Date as to all Underlying Shares, not subject to
any threatened or actual stop order and will not on the
Closing Date contain any untrue statement of material fact or
omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading;
(iii) The Company shall have duly executed and
delivered the Investor and Registration Rights Agreement;
(iv) The Company shall have notified the Nasdaq
National Market (the "TRADING MARKET") of the issuance of the
Underlying Shares;
(v) The Company shall have received written notice
from the Trading Market that the sale and issuance of the
Securities is exempted from the requirements of Section
4350(i)(1) by virtue of the fact that a delay in obtaining
stockholder approval of the sale and issuance of the
Securities and the other transactions contemplated hereby
would seriously jeopardize the financial viability of the
Company (the "EXEMPTION"); and
(vi) The Company shall have provided a certificate
from a duly authorized officer certifying on behalf of the
Company that each of the conditions set forth in this Section
1(b) shall have been satisfied.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby makes the following representations and warranties to
the Purchaser:
(a) SUBSIDIARIES. The Company does not directly or indirectly
control or own any interest in any other corporation, partnership, joint venture
or other business association or entity, other than MaxCyte, Inc. and Cytokine
Sciences, Inc. (each a "SUBSIDIARY" and, collectively, the "SUBSIDIARIES").
(b) ISSUANCE OF THE SECURITIES. The Securities (including the
Underlying Shares) are duly authorized and, when issued and paid for in
accordance with the terms hereof, will be duly and validly issued, fully paid
and nonassessable, free and clear of free and clear of any lien, charge, claim,
security interest, encumbrance, right of first refusal or other restriction and
shall not be subject to preemptive rights or similar rights of stockholders. The
Company has reserved a sufficient number of duly authorized shares of Common
Stock to issue all of the Underlying Shares. At the Closing, the Underlying
Shares shall have been listed for trading on the Trading Market.
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(c) REGISTRATION STATEMENT. The Company's Registration
Statement on Form S-3 (No. 333-87940) (the "REGISTRATION STATEMENT") was
declared effective by the Securities and Exchange Commission (the "COMMISSION")
on September 27, 2002. The Registration Statement is effective on the date
hereof and the Company has not received notice that the Commission has issued or
intends to issue a stop order with respect to the Registration Statement or that
the Commission otherwise has suspended or withdrawn the effectiveness of the
Registration Statement, either temporarily or permanently, or intends or has
threatened in writing to do so. The Registration Statement (including the
information or documents incorporated by reference therein), as of the time it
was declared effective and as of the date hereof, and any amendments or
supplements thereto, each as of the time of filing and as of the date hereof,
did not and do not contain any untrue statement of material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading. The issuance of the Underlying Shares to the
Purchaser is registered by the Registration Statement.
(d) LISTING AND MAINTENANCE REQUIREMENTS, Except as described
in Schedule 2(d), the Company has not, in the two years preceding the date
hereof, received notice (written or oral) from the Trading Market to the effect
that the Company is not in compliance with the listing or maintenance
requirements thereof.
(e) CERTAIN FEES. Except for listing fees to be paid by the
Company to the Trading Market and fees and commissions due to Ferghana Partners
Inc., no fees or commissions will be payable by the Company to any broker,
financial advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated by this
Agreement. The Purchaser shall have no obligation with respect to any fees
incurred by the Company or any other Person (other than the Purchaser, if the
Purchaser has agreed in writing to pay such fees) or with respect to any claims
made by or on behalf of other Persons for fees of a type contemplated in this
Section that may be due in connection with the transactions contemplated by this
Agreement. The Company shall indemnify and hold harmless the Purchaser, its
employees, officers, directors, agents, and partners, and its affiliates, from
and against all claims, losses, damages, costs (including the reasonable costs
of preparation and reasonable attorney's fees) and expenses suffered in respect
of any such claimed or existing fees incurred by the Company or any other Person
(other than the Purchaser, if the Purchaser has agreed in writing to pay such
fees), as such fees and expenses are incurred. "PERSON" means any court or other
federal, state, local or other governmental authority or other individual or
corporation, partnership, trust, incorporated or unincorporated association,
joint venture, limited liability company, joint stock company, government (or an
agency or subdivision thereof) or other entity of any kind.
(f) DISCLOSURE. Subject to Section 4.8 below, no event or
circumstance has occurred or information exists with respect to the Company or
any of its Subsidiaries or its or their business, properties, prospects,
operations or financial conditions, which, under applicable law, rule or
regulation, requires public disclosure or announcement by the Company but which
has not been so publicly announced or disclosed (assuming for this purpose that
the Company's reports filed under the Securities Exchange Act of 1934, as
amended (the "EXCHANGE ACT") are being incorporated into an effective
registration statement filed by the Company under the Securities Act of 1933, as
amended (the "SECURITIES ACT")). The Company acknowledges and agrees that the
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Purchaser is not making and has not made any representations or warranties with
respect to the transactions contemplated hereby other than those specifically
set forth in Section 3.
(g) NO VIOLATION. The issuance and sale of the Securities
hereunder does not conflict with or violate any rules or regulations of the
Trading Market.
(h) SEC REPORTS; FINANCIAL STATEMENTS. The Company has filed
all reports required to be filed by it under the Securities Act and the Exchange
Act, including, without limitation, pursuant to Section 13(a) or 15(d) of the
Exchange Act, for the two years preceding the date hereof (the foregoing
materials being collectively referred to herein as the "SEC REPORTS" and,
together with this Agreement and the Schedules to this Agreement, the
"DISCLOSURE MATERIALS") on a timely basis or has received a valid extension of
such time of filing and has filed any such SEC Reports prior to the expiration
of any such extension. The Company has delivered to the Purchaser a copy of all
SEC Reports filed within the 20 days preceding the date hereof. As of their
respective dates, the SEC Reports complied in all material respects with the
requirements of the Securities Act and the Exchange Act and the rules and
regulations of the Commission promulgated thereunder, and none of the SEC
Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. The financial statements of the Company included
in the SEC Reports comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with respect
thereto as in effect at the time of filing. Such financial statements have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis during the periods involved ("GAAP"), except as may be
otherwise specified in such financial statements or the notes thereto, and
fairly present in all material respects the financial position of the Company
and its consolidated subsidiaries as of and for the dates thereof and the
results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit adjustments.
All material agreements to which the Company or any Subsidiary is a party or to
which the property or assets of the Company or any Subsidiary are subject are
included as part of or specifically identified in the SEC Reports.
(i) CAPITALIZATION. The number of shares and type of all
authorized, issued and outstanding capital stock, options and other securities
of the Company (whether or not presently convertible or exchangeable for shares
of capital stock of the Company) is set forth in Schedule 2(i). All outstanding
shares of capital stock are duly authorized, validly issued, fully paid and
nonassessable and have been issued in compliance with all applicable securities
laws. Except as disclosed in Schedule 2(i), there are no outstanding options,
warrants, script rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or
exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of Common Stock, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to
issue additional shares of Common Stock, or securities or rights convertible or
exchangeable into shares of Common Stock. There are no anti-dilution or price
adjustment provisions contained in any security issued by the Company (or in any
agreement providing rights to security holders) and the issue and sale of the
Securities will not obligate the Company to issue shares of Common Stock or
other securities to any Person and will not result in a right of any holder of
Company securities to adjust the exercise, conversion, exchange or reset price
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under such securities. To the knowledge of the Company, except as specifically
disclosed in Schedule 2(i), no Person or group of related Persons beneficially
owns (as determined pursuant to Rule 13d-3 under the Exchange Act), or has the
right to acquire, by agreement with or by obligation binding upon the Company,
beneficial ownership of in excess of five percent (5%) of the outstanding Common
Stock, ignoring for such purposes any limitation on the number of shares of
Common Stock that may be owned at any single time.
(j) MATERIAL CHANGES. Since the date of the latest audited
financial statements included within the SEC Reports, except as specifically
disclosed in the SEC Reports, (i) there has been no event, occurrence or
development that has had or that could (x) adversely affect the legality,
validity or enforceability of this Agreement, (y) have or result in a material
adverse effect on the results of operations, assets, prospects, business or
condition (financial or otherwise) of the Company and the Subsidiaries, taken as
a whole, or (z) adversely impair the Company's ability to perform fully on a
timely basis its obligations under this Agreement (any of (x), (y) or (z), a
"MATERIAL ADVERSE EFFECT"), (ii) the Company has not incurred any liabilities
(contingent or otherwise) other than (A) trade payables and accrued expenses
incurred in the ordinary course of business consistent with past practice and
(B) liabilities not required to be reflected in the Company's financial
statements pursuant to GAAP or required to be disclosed in filings made with the
Commission, (iii) the Company has not altered its method of accounting or the
identity of its auditors, (iv) the Company has not declared or made any dividend
or distribution of cash or other property to its stockholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital
stock, and (v) the Company has not issued any equity securities to any officer,
director or affiliate, except pursuant to existing Company stock option plans or
employment termination agreements.
(k) LITIGATION. There is no action, suit, claim, inquiry,
notice of violation, proceeding or investigation pending or, to the knowledge of
the Company, threatened against or affecting the Company, any Subsidiary or any
of their respective properties before or by any court, arbitrator, public board,
governmental or administrative agency or regulatory authority (federal, state,
county, local or foreign) (collectively, an "ACTION") which (i) adversely
affects or challenges the legality, validity or enforceability of this Agreement
or the Securities or (ii) could, if there were an unfavorable decision,
individually or in the aggregate, have or result in a Material Adverse Effect.
Schedule 2(k) contains a complete list and summary description of any pending
or, to the knowledge of the Company, threatened proceeding against or affecting
the Company or any of its Subsidiaries, without regard to whether it would have
a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any
director or officer thereof, is or has been the subject of any Action involving
a claim of violation of or liability under federal or state securities laws or a
claim of breach of fiduciary duty. The Company does not have pending before the
Commission any request for confidential treatment of information. There has not
been, and to the knowledge of the Company, there is not pending or contemplated,
any investigation by the Commission involving the Company or any current or
former director or officer of the Company. The Commission has not issued any
stop order or other order suspending the effectiveness of any registration
statement filed by the Company or any Subsidiary under the Exchange Act or the
Securities Act. No strike, work stoppage, slow down or other material labor
problem exists or, to the knowledge of the Company, is threatened or imminent
with respect to any of the employees of the Company or the Subsidiaries.
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(l) COMPLIANCE. Neither the Company nor any Subsidiary (i) is
in default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, would result in a default by
the Company or any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it is in
violation of, any indenture, loan or credit agreement or any other agreement or
instrument to which it is a party or by which it or any of its properties is
bound (whether or not such default or violation has been waived), (ii) is in
violation of any order of any court, arbitrator or governmental body, or (iii)
is or has been in violation of any statute, rule or regulation of any
governmental authority, including without limitation all foreign, federal, state
and local laws relating to taxes, environmental protection, occupational health
and safety, product quality and safety and employment and labor matters, except
in each case as could not, individually or in the aggregate, have or result in a
Material Adverse Effect.
(m) SOLVENCY. Based on the financial condition of the Company
as of the Closing Date, and after giving effect to the Asset Purchase Agreement
by and between the Company and the Purchaser, dated as of the date hereof, and
the sale and issuance of the Shares, (i) the Company's fair saleable value of
its assets exceeds the amount that will be required to be paid on or in respect
of the Company's existing debts and other liabilities (including known
contingent liabilities) as they mature; (ii) the Company's assets do not
constitute unreasonably small capital to carry on its business for the current
fiscal year as now conducted and as proposed to be conducted including its
capital needs taking into account the particular capital requirements of the
business conducted by the Company, and projected capital requirements and
capital availability thereof; and (iii) the current cash flow of the Company,
together with the proceeds the Company would receive, were it to liquidate all
of its assets, after taking into account all anticipated uses of the cash, would
be sufficient to pay all amounts on or in respect of its debt when such amounts
are required to be paid. The Company does not intend to incur debts beyond its
ability to pay such debts as they mature (taking into account the timing and
amounts of cash to be payable on or in respect of its debt).
(n) ACKNOWLEDGMENT REGARDING PURCHASER'S PURCHASE OF
SECURITIES. The Company acknowledges and agrees that the Purchaser is acting
solely in the capacity of an arm's length purchaser with respect to this
Agreement and the transactions contemplated hereby. The Company further
acknowledges that the Purchaser is not acting as a financial advisor or
fiduciary of the Company (or in any similar capacity) with respect to this
Agreement and the transactions contemplated hereby and any advice given by the
Purchaser or any of its representatives or agents in connection with this
Agreement and the transactions contemplated hereby is merely incidental to the
Purchaser's purchase of the Securities.
3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The
Purchaser hereby represents, warrants and covenants to the Company that (i) the
Purchaser is an entity duly organized, validly existing and in good standing
under the laws of the State of Delaware with the requisite corporate power and
authority to enter into and to consummate the transactions contemplated by this
Agreement and otherwise to carry out its obligations hereunder; (ii) the
purchase by the Purchaser of the Shares and Warrant hereunder has been duly
authorized by all necessary action on the part of the Purchaser; and (iii) this
Agreement has been duly executed and delivered by the Purchaser and constitutes
the valid and legally binding obligation of the Purchaser, enforceable against
it in accordance with its terms. The Company acknowledges and agrees that the
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Purchaser is not making and has not made any representations or warranties with
respect to the transactions contemplated hereby other than those specifically
set forth in this Section 3.
4. OTHER AGREEMENTS OF THE PARTIES.
4.1 Preemptive Rights. The Company hereby grants to the
Purchase a preemptive right to purchase all or any part of the Purchaser's Pro
Rata Share (as defined below) of any New Securities (as defined below) that the
Company may, from time to time, propose to issue or sell. Such preemptive right
shall be subject to the following provisions of this Section 4.1.
(a) Procedure. In the event that the Company proposes to
undertake an issuance of New Securities, the Company shall give the Purchaser
written notice of its intention, describing the type of New Securities and the
price and other terms and conditions upon which the Company proposes to issue
such New Securities. The Purchaser shall have 20 days from the date any such
notice is given to agree, by written notice to the Company, to purchase all or
any part of its pro rata share of such New Securities at the price and upon the
other terms and conditions specified in the Company's notice by giving written
notice to the Company of its intention to exercise its preemptive right and
stating therein the number of New Securities, up to its pro rata share, to be
purchased. The failure of the Purchaser to notify the Company within such 20-day
period shall constitute an election by the Purchaser not to exercise its
preemptive right with respect to such issuance. If the Purchaser has elected to
exercise all or any part of its preemptive right hereunder, the Company shall,
within three days of the date of issuance of the New Securities, issue to the
Purchaser such number of New Securities as the Purchaser requested in its notice
to the Company and, simultaneously therewith, the Purchaser shall pay to the
Company the purchase price therefor in immediately available funds by bank check
or wire transfer to an account designated in writing by the Company.
(b) Certain Definitions.
(i) "AS-CONVERTED BASIS" shall mean, with respect to
the calculation of the number of shares of Common Stock, (i)
all shares of Common Stock outstanding at the time of
determination and (ii) all shares of Common Stock issuable at
the time of determination upon exercise, conversion or
exchange of any Convertible Security.
(ii) "CONVERTIBLE SECURITY" shall mean any evidences
of indebtedness, shares (other than Common Stock) or other
securities directly or indirectly convertible into or
exercisable or exchangeable for Common Stock.
(iii) "NEW SECURITIES" shall mean any shares of
capital stock of the Company and any Convertible Securities;
provided, however, that "New Securities" shall not include (i)
securities issuable upon exercise, conversion or exchange of
other securities of the Company, (ii) securities issued to
officers, directors or employees of, or consultants to, the
Company pursuant to stock options outstanding on the date
hereof or stock options granted after the date hereof on terms
approved by the Board of Directors of the Company (as adjusted
for any stock splits, stock dividends, stock combinations or
similar transactions), (iii) shares of the Company's capital
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stock issued pursuant to any rights or agreements, including,
without limitation, Convertible Securities, provided that the
preemptive rights established by this Section 4.1 shall apply
with respect to the initial sale or grant by the Company of
such rights or agreements, (iv) shares of the Company's
capital stock issued in connection with any stock split, stock
dividend or recapitalization by the Company, (v) shares issued
pursuant to any employment agreement or employee benefit plan
or in satisfaction of liabilities in existence on the date
hereof to creditors disclosed on Schedule 2(j), (vi)
securities issued in connection with a merger or
consolidation, or purchase of all or substantially all of the
assets, shares or other interests, involving the Company,
(vii) securities issued in connection with a strategic
partnership, up to an aggregate of five percent of the
outstanding capital stock of the Company on the date hereof
after giving effect to the transactions contemplated by this
Agreement (including, without limitation the issuance of the
Shares and the Warrant); provided, that any -------- such
issuance is not for the principal purpose of raising equity
capital, or (viii) securities issued for cash consideration
equal to or greater than $1.50 per share of Common Stock (as
adjusted for any stock splits, stock dividends, stock
combinations or similar transactions) in a transaction exempt
from registration under the Securities Act with an aggregate
value of $10 million or less.
(iv) "PRO RATA SHARE" shall mean the ratio that (i)
the total number of shares of Common Stock on an As-Converted
Basis then held by the Purchaser bears to (ii) the total
number of shares of Common Stock on an As-Converted Basis then
outstanding.
4.2 Reservation and Listing of Underlying Shares. The Company
shall maintain a reserve from its duly authorized shares of Common Stock for
issuance pursuant to this Agreement in such amount as may be required to fulfill
its obligations in full under this Agreement and upon conversion of the Shares
and exercise or conversion of the Warrant. In the event that at any time the
then authorized shares of Common Stock are insufficient for the Company to
satisfy its obligations in full under this Agreement and upon conversion of the
Shares and exercise or conversion of the Warrant, the Company shall promptly
take such actions as may be required to increase the number of authorized
shares. The Company shall take such steps as may be required to cause and
maintain the listing of the Underlying Shares on the Trading Market and such
other exchange, market or quotation facility on which the Common Stock is
traded.
4.3 Shareholders Rights Plan. No claim will be made or
enforced by the Company that the Purchaser is an "Acquiring Person" under any
shareholder rights plan or similar plan or arrangement in effect or hereafter
adopted by the Company, or that the Purchaser could be deemed to trigger the
provisions of any such plan or arrangement, by virtue of purchasing the
Securities hereunder or the acquisition of any other securities of the Company
under any other arrangement between the Company and the Purchaser.
4.4 Board of Directors.
(a) The Company shall use its best efforts to take all action
necessary in accordance with the Delaware General Corporation Law and its
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Certificate of Incorporation and Bylaws, and shall use its best efforts to take
all other actions necessary, to ensure that the Purchaser shall have the right
to designate up to two (2) individuals to serve as members of the Board of
Directors of the Company (each, a "Purchaser Director"). Upon the Purchaser's
written request, the Company shall (i) increase the size of the Board or
otherwise create vacancies sufficient to create up to two vacancies effective no
later than the date designated by Purchaser, (ii) appoint the Purchaser
Director(s) as member(s) of the Board, and (iii) enter into an indemnification
agreement reasonably acceptable to the Purchaser with each Purchaser Director.
(b) If the Purchaser does not at any time have a designee on
the Board of Directors of the Company) the Company shall give the Purchaser
notice of each meeting of the Board of Directors of the Company at the same time
and in the same manner as notice is given to the directors and permit a designee
of the Purchaser (an "OBSERVER") to attend in person, as an observer, all
meetings held in person and to participate in telephonic meetings of the Board
of Directors of the Company solely for the purpose of allowing the Purchaser to
have current information with respect to the affairs of the Company. The Company
shall provide to the Purchaser in connection with each meeting it is entitled to
have an Observer attend, whether or not present at such meeting, copies of all
notices, minutes, consents, and all other materials or information that the
Company provides to the directors of the Company with respect to such meeting,
at the same time such materials and information are given to the directors of
the Company (except that materials and information provided to directors of the
Company at meetings of the Board of Directors of the Company at which an
Observer is not present shall be provided to the Purchaser promptly after the
meeting). If the Board of Directors proposes to take any action by written
consent in lieu of a meeting, the Company shall give written notice thereof to
the Purchaser prior to the effective date of such consent describing in
reasonable detail the nature and substance of such action.
4.5 Furnishing of Information. As long as the Purchaser owns
Securities, the Company covenants to timely file (or obtain extensions in
respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the date hereof pursuant to the
Securities Act and the Exchange Act. Upon the request of the Purchaser, the
Company shall deliver to such Purchaser a written certification of a duly
authorized officer as to whether it has complied with the preceding sentence. As
long as the Purchaser owns Securities, if the Company is not required to file
reports pursuant to such laws, it will prepare and furnish to the Purchaser and
make reasonably available the information concerning the Company specified in
paragraphs (a)(5)(i) to (xiv), inclusive, and (xvi) of Rule 15c2-11 under the
Exchange Act.
4.6 Disclosure of Material Non-Public Information. Upon the
written request of the Purchaser, the Company shall not and shall cause each of
its affiliates (as defined in Rule 405 under the Securities Act) and other
Persons acting on behalf of the Company not to divulge to the Purchaser any
information that it believes to be material non-public information unless the
Purchaser has agreed in writing to receive such information prior to such
divulgence. The Purchaser may rescind and deliver such written request at any
time and from time to time.
4.7 Stockholder Notice. On December 31, 2002, the Company
shall mail to all stockholders of the Company a letter alerting such
stockholders to the omission of the Company to obtain stockholder approval of
the issuance and sale of the Securities, which would otherwise be required by
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the rules of the Trading Market, and indicating that the audit committee of the
board of directors of the Company has expressly approved the Exemption.
4.8 Filing of Supplement. The Company shall file the
Supplement with the Commission as soon as reasonably practicable, but in no
event later than the date the Supplement is required to be filed pursuant to
Rule 424(b) promulgated under the Securities Act.
5. MISCELLANEOUS.
(a) Any notices or other communications required or permitted
under, or otherwise in connection with, this Agreement shall be in writing and
shall be deemed to have been duly given (w) when delivered in person, (x) upon
confirmation of receipt when transmitted by facsimile transmission, (y) on
receipt after dispatch by registered or certified mail, postage prepaid, or (z)
on the next Business Day if transmitted by national overnight courier, addressed
in each case as follows (or to such other address which has been delivered in
accordance with this Section 5(a)): "BUSINESS DAY" shall mean any day on which
banks are not required or authorized to close in New York, New York.
(a) if to Purchaser, to:
Celgene Corporation
0 Xxxxxx Xxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention:
with a copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
(b) if to the Company, to:
EntreMed, Inc.
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: President
10
with a copy to:
Xxxxxx & Xxxxxx
000 Xxxxxxx Xxxxxx, XX
Xxxxxxxxxx, X.X. 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx, Esq.
(b) Descriptive Headings. The descriptive headings herein are
inserted for convenience only and are not intended to be part of or to affect
the meaning or interpretation of this Agreement.
(c) Counterparts; Facsimile Signatures. This Agreement may be
executed in counterparts, each of which shall be deemed an original, but both of
which together shall constitute one and the same agreement. In the event that
any signature is delivered by facsimile transmission, such signature shall
create a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature page were an original thereof.
(d) Entire Agreement. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge have been merged into
this Agreement and its exhibits and schedules.
(e) Fees and Expenses. Regardless of whether or not the
transactions contemplated by this Agreement are consummated, each party shall
bear its own fees and expenses incurred in connection with the negotiation,
execution, delivery and performance of this Agreement, except as otherwise
expressly provided herein. The Company shall pay all transfer agent fees, stamp
taxes and other taxes and duties levied in connection with the issuance of the
Securities.
(f) Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of New York, as applied to
agreements between New York residents entered into and to be performed entirely
within New York.
(g) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
(h) Assignment. The Company may not assign this Agreement or
any rights or obligations hereunder without the prior written consent of the
Purchaser. The Purchaser may assign its rights under this Agreement to any
Person to whom the Purchaser assigns or transfers any Securities, provided such
transferee agrees in writing to be bound, with respect to the transferred
Securities, by the provisions hereof that apply to the "Purchaser."
11
(i) Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto and its successors and
permitted assigns, and, except as expressly provided herein, nothing in this
Agreement, express or implied, is intended to or shall confer upon any other
Person any rights, interests, benefits or remedies of any nature whatsoever
under or by reason of this Agreement.
(j) Interpretation. In the event of an ambiguity or question
of intent or interpretation, this Agreement shall be construed as if drafted
jointly by the parties and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any provisions
of this Agreement.
(k) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable in any respect for any reason, the
parties shall negotiate in good faith with a view to the substitution therefor
of a suitable and equitable solution in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid provision;
provided, however, that the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be in any way impaired thereby, it being intended that all of
the rights and privileges of the parties hereto shall be enforceable to the
fullest extent permitted by law.
(l) Payments. Unless otherwise provided herein, all payments
required to be made pursuant to this Agreement shall be made in U.S. dollars in
the form of cash or by wire transfer of immediately available funds to an
account designated by the party receiving such payment.
(m) Amendment; Waiver. No provision of this Agreement may be
waived or amended except in a written instrument signed, in the case of an
amendment, by the Company and the Purchaser or, in the case of a waiver, by the
party against whom enforcement of any such waiver is sought. No waiver of any
default with respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future or a waiver of
any subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of any party to exercise any
right hereunder in any manner impair the exercise of any such right.
(n) Further Assurances. Each party hereto 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 any other party hereto reasonably may request in order to carry out
the intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.
(o) Survival. The representations, warranties, agreements and
covenants contained herein shall survive the Closing and the delivery, exercise
and/or conversion of the Securities, as applicable.
(p) Replacement of Securities. If any certificate or
instrument evidencing any Securities is mutilated, lost, stolen or destroyed,
the Company shall issue or cause to be issued in exchange and substitution for
and upon cancellation thereof, or in lieu of and substitution therefor, a new
12
certificate or instrument, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft or destruction and customary and
reasonable indemnity, if requested. The applicants for a new certificate or
instrument under such circumstances shall also pay any reasonable third-party
costs associated with the issuance of such replacement Securities.
[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK. SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, the parties hereto have caused this
Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.
ENTREMED, INC.
By: /s/ Xxxx Xxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxx
Title: President
CELGENE CORPORATION
By: /s/ Xxxxxx X. Hugin
--------------------------------
Name: Xxxxxx X. Hugin
Title: Senior Vice President and
Chief Financial Officer
