Exhibit 10.1
Execution Version
COMMON STOCK PURCHASE
AGREEMENT
Dated August 19,
2009
by and between
PONIARD PHARMACEUTICALS,
INC.
and
AZIMUTH OPPORTUNITY
LTD.
TABLE OF
CONTENTS
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Page
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ARTICLE I PURCHASE AND SALE OF COMMON
STOCK
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1
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Section 1.1.
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Purchase and Sale of Stock
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1
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Section 1.2.
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Effective Date; Settlement Dates
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1
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Section 1.3.
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The Shares
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2
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Section 1.4.
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Current Report; Prospectus Supplement
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2
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ARTICLE II FIXED REQUEST TERMS; OPTIONAL
AMOUNT
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2
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Section 2.1.
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Fixed Request Notice
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2
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Section 2.2.
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Fixed Requests
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3
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Section 2.3.
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Share Calculation
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4
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Section 2.4.
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Limitation of Fixed Requests
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4
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Section 2.5.
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Reduction of Commitment
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4
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Section 2.6.
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Below Threshold Price
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4
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Section 2.7.
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Settlement
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5
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Section 2.8.
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Reduction of Pricing Period
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5
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Section 2.9.
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Optional Amount
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6
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Section 2.10.
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Calculation of Optional Amount Shares
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6
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Section 2.11.
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Exercise of Optional Amount
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7
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Section 2.12.
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Aggregate Limit
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7
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ARTICLE III REPRESENTATIONS AND WARRANTIES OF
THE INVESTOR
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8
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Section 3.1.
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Organization and Standing of the
Investor
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8
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Section 3.2.
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Authorization and Power
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8
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Section 3.3.
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No Conflicts
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9
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Section 3.4.
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Information
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9
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ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE
COMPANY
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9
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Section 4.1.
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Organization, Good Standing and Power
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9
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Section 4.2.
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Authorization, Enforcement
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10
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Section 4.3.
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Capitalization
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10
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Section 4.4.
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Issuance of Shares
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11
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Section 4.5.
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No Conflicts
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11
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Section 4.6.
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Commission Documents, Financial
Statements
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11
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Section 4.7.
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Subsidiaries
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13
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Section 4.8.
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No Material Adverse Effect
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13
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Section 4.9.
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Indebtedness
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13
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Section 4.10.
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Title To Assets
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13
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Section 4.11.
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Actions Pending
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13
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Section 4.12.
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Compliance With Law
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14
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Section 4.13.
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Certain Fees
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14
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Section 4.14.
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Operation of Business
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14
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Section 4.15.
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Environmental Compliance
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16
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Section 4.16.
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Material Agreements
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16
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Section 4.17.
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Transactions With Affiliates
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17
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Section 4.18.
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Securities Act; NASD Conduct Rules
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17
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Section 4.19.
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Employees
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19
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Section 4.20.
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Use of Proceeds
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19
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Section 4.21.
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Investment Company Act Status
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19
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Section 4.22.
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ERISA
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19
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Section 4.23.
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Taxes
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20
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Section 4.24.
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Insurance
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20
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Section 4.25.
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Acknowledgement Regarding Investor’s
Purchase of Shares
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20
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ARTICLE V COVENANTS
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20
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Section 5.1.
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Securities Compliance
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20
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Section 5.2.
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Registration and Listing
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21
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Section 5.3.
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Compliance with Laws
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21
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Section 5.4.
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Keeping of Records and Books of Account; Foreign
Corrupt Practices Act
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21
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Section 5.5.
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Limitations on Holdings and Issuances
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22
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Section 5.6.
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Other Agreements and Other Financings
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22
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Section 5.7.
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Stop Orders
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23
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Section 5.8.
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Amendments to the Registration Statement;
Prospectus Supplements; Free Writing Prospectuses
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24
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Section 5.9.
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Prospectus Delivery
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25
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Section 5.10.
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Selling Restrictions
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25
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Section 5.11.
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Effective Registration Statement
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26
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Section 5.12.
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Non-Public Information
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26
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Section 5.13.
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Broker/Dealer
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26
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Section 5.14.
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Disclosure Schedule
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27
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ARTICLE VI OPINION OF COUNSEL AND
CERTIFICATE; CONDITIONS TO THE SALE AND PURCHASE OF THE
SHARES
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27
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Section 6.1.
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Opinion of Counsel and Certificate
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27
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Section 6.2.
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Conditions Precedent to the Obligation of the
Company
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27
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Section 6.3.
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Conditions Precedent to the Obligation of the
Investor
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29
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ARTICLE VII TERMINATION
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31
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Section 7.1.
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Term, Termination by Mutual Consent
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31
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Section 7.2.
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Other Termination
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32
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Section 7.3.
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Effect of Termination
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32
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ARTICLE VIII INDEMNIFICATION
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33
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Section 8.1.
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General Indemnity
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33
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Section 8.2.
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Indemnification Procedures
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34
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ARTICLE IX MISCELLANEOUS
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35
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Section 9.1.
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Fees and Expenses
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35
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Section 9.2.
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Specific Enforcement, Consent to Jurisdiction,
Waiver of Jury Trial
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36
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ii
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Section 9.3.
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Entire Agreement; Amendment
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37
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Section 9.4.
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Notices
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37
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Section 9.5.
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Waivers
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38
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Section 9.6.
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Headings
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38
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Section 9.7.
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Successors and Assigns
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38
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Section 9.8.
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Governing Law
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38
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Section 9.9.
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Survival
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38
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Section 9.10.
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Counterparts
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39
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Section 9.11.
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Publicity
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39
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Section 9.12.
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Severability
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39
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Section 9.13.
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Further Assurances
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39
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Annex
A. Definitions
iii
COMMON STOCK PURCHASE
AGREEMENT
This COMMON STOCK PURCHASE
AGREEMENT , made and entered into on this 19
th day of August 2009 (this “
Agreement ”), by and between Azimuth Opportunity Ltd.,
an international business company incorporated under the laws of
the British Virgin Islands (the “ Investor ”),
and Poniard Pharmaceuticals, Inc., a corporation organized and
existing under the laws of the State of Washington (the “
Company ”). Capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in Annex
A hereto.
RECITALS
WHEREAS , the parties desire that, upon the terms and
subject to the conditions contained herein, the Company may issue
and sell to the Investor and the Investor shall thereupon purchase
from the Company up to $60,000,000 of newly issued shares of the
Company’s common stock, $0.02 par value (“ Common
Stock ”), subject, in all cases, to the Trading Market
Limit; and
WHEREAS , the offer and sale of the shares of Common
Stock hereunder have been registered by the Company in the
Registration Statement, which has been declared effective by order
of the Commission under the Securities Act;
NOW, THEREFORE
, the parties hereto, intending to
be legally bound, hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF COMMON STOCK
Section 1.1.
Purchase and Sale of Stock . Upon the terms and
subject to the conditions of this Agreement, during the Investment
Period the Company in its discretion may issue and sell to the
Investor up to $60,000,000 (the “ Total Commitment
”) of duly authorized, validly issued, fully paid and
non-assessable shares of Common Stock (subject in all cases to the
Trading Market Limit, the “ Aggregate Limit ”),
by (i) the delivery to the Investor of not more than 24
separate Fixed Request Notices (unless the Investor and the Company
mutually agree that a different number of Fixed Request Notices may
be delivered) as provided in Article II hereof and
(ii) the exercise by the Investor of Optional Amounts, which
the Company may in its discretion grant to the Investor and which
may be exercised by the Investor, in whole or in part, as provided
in Article II hereof. The aggregate of all Fixed Request
Amounts and Optional Amount Dollar Amounts shall not exceed the
Aggregate Limit.
Section 1.2.
Effective Date; Settlement Dates . This
Agreement shall become effective and binding upon delivery of
counterpart signature pages of this Agreement executed by each
of the parties hereto, and by delivery of an opinion of counsel and
a certificate of the Company as provided in Section 6.1
hereof, to the offices of Greenberg Traurig, LLP, 200 Park Avenue,
New York, New York 10166, at l0:00 a.m., New York time, on the
Effective Date. In consideration of and in express reliance
upon the representations, warranties and covenants, and otherwise
upon the terms and subject to the conditions, of this Agreement,
from and after the Effective Date and during the Investment Period
(i) the Company shall issue and sell to the Investor, and the
Investor agrees to purchase from the Company, the Shares in respect
of each
Fixed Request and (ii) the Investor may in
its discretion elect to purchase Shares in respect of each Optional
Amount. The issuance and sale of Shares to the Investor
pursuant to any Fixed Request or Optional Amount shall occur on the
applicable Settlement Date in accordance with Sections 2.7 and 2.9
(or on such Trading Day in accordance with Section 2.8, as
applicable), provided in each case that all of the
conditions precedent thereto set forth in Article VI
theretofore shall have been fulfilled or (to the extent permitted
by applicable law) waived.
Section 1.3.
The Shares . The Company has or will have duly
authorized and reserved for issuance, and covenants to continue to
so reserve once reserved for issuance, free of all preemptive and
other similar rights, at all times during the Investment Period,
the requisite aggregate number of authorized but unissued shares of
its Common Stock to timely effect the issuance, sale and delivery
in full to the Investor of all Shares to be issued in respect of
all Fixed Requests and Optional Amounts under this Agreement, in
any case prior to the issuance to the Investor of such
Shares.
Section 1.4.
Current Report; Prospectus Supplement . As soon
as practicable, but in any event not later than 5:30 p.m. (New
York time) on the first Trading Day immediately following the
Effective Date, the Company shall file with the Commission a report
on Form 8-K relating to the transactions contemplated by, and
describing the material terms and conditions of, this Agreement and
disclosing all information relating to the transactions
contemplated hereby required to be disclosed in the Registration
Statement and the Base Prospectus (but which permissibly has been
omitted therefrom in accordance with the Securities Act),
including, without limitation, information required to be disclosed
in the section captioned “ Plan of Distribution
” in the Base Prospectus (the “ Current Report
”). The Current Report shall include a copy of this
Agreement as an exhibit. To the extent applicable, the
Current Report shall be incorporated by reference in the
Registration Statement in accordance with the provisions of
Rule 430B under the Securities Act. The Company
heretofore has provided the Investor a reasonable opportunity to
comment on a draft of such Current Report and has given due
consideration to such comments. The Company shall file a
final Base Prospectus pursuant to Rule 424(b) under the
Securities Act on or prior to the second Trading Day immediately
following the Effective Date. Pursuant to Section 5.9
and subject to the provisions of Section 5.8, on the first
Trading Day immediately following the last Trading Day of each
Pricing Period, the Company shall file with the Commission a
Prospectus Supplement pursuant to Rule 424(b) under the
Securities Act disclosing the number of Shares to be issued and
sold to the Investor thereunder, the total purchase price therefor
and the net proceeds to be received by the Company therefrom and,
to the extent required by the Securities Act, identifying the
Current Report.
ARTICLE II
FIXED REQUEST TERMS; OPTIONAL AMOUNT
Subject to the satisfaction of the
conditions set forth in this Agreement, the parties agree (unless
otherwise mutually agreed upon by the parties in writing) as
follows:
Section 2.1.
Fixed Request Notice . The Company may, from
time to time in its sole discretion, no later than 9:30 a.m.
(New York time) on the second Trading Day immediately preceding the
first Trading Day of the Pricing Period, provide to the Investor a
Fixed Request notice, substantially in the form attached hereto as
Exhibit A (the “ Fixed Request Notice
”),
2
which Fixed Request Notice shall become
effective at 9:30 a.m. (New York time) on the first Trading
Day of the Pricing Period. The Fixed Request Notice shall specify
the Fixed Amount Requested, establish the Threshold Price for such
Fixed Request, designate the first Trading Day of the Pricing
Period and specify the Optional Amount, if any, that the Company
elects to grant to the Investor during the Pricing Period and the
applicable Threshold Price for such Optional Amount (the “
Optional Amount Threshold Price ”). The
Threshold Price and the Optional Amount Threshold Price established
by the Company in a Fixed Request Notice may be the same or
different, in the Company’s sole discretion. Upon the
terms and subject to the conditions of this Agreement, the Investor
is obligated to accept each Fixed Request Notice prepared and
delivered in accordance with the provisions of this
Agreement.
Section 2.2.
Fixed Requests . From time to time during the
Investment Period, the Company may in its sole discretion deliver
to the Investor a Fixed Request Notice for a specified Fixed Amount
Requested, and the applicable discount price (the “
Discount Price ”) shall be determined, in accordance
with the price and share amount parameters as set forth below or
such other parameters mutually agreed upon by the Investor and the
Company, and upon the terms and subject to the conditions of this
Agreement, the Investor shall purchase from the Company the Shares
subject to such Fixed Request Notice; provided ,
however , that (i) if an ex-dividend date is
established by the Trading Market in respect of the Common Stock on
or between the first Trading Day of the applicable Pricing Period
and the applicable Settlement Date, the Discount Price shall be
reduced by the per share dividend amount and (ii) the Company
may not deliver any single Fixed Request Notice for a Fixed Amount
Requested in excess of the lesser of (a) the amount in the
applicable Fixed Amount Requested column below and (b) 2.5% of
the Market Capitalization:
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Threshold Price
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Fixed Amount
Requested
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Discount Price
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Equal to or greater than $15.00
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Not to exceed $11,000,000
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96.000% of the VWAP
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Equal to or greater than $14.00 and less than
$15.00
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Not to exceed $10,250,000
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95.875% of the VWAP
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Equal to or greater than $13.00 and less than
$14.00
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Not to exceed $9,500,000
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95.750% of the VWAP
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Equal to or greater than $12.00 and less than
$13.00
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Not to exceed $8,750,000
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95.625% of the VWAP
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Equal to or greater than $11.00 and less than
$12.00
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Not to exceed $8,000,000
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95.500% of the VWAP
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Equal to or greater than $10.00 and less than
$11.00
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Not to exceed $7,250,000
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95.375% of the VWAP
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Equal to or greater than $9.00 and less than
$10.00
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Not to exceed $6,500,000
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95.250% of the VWAP
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Equal to or greater than $8.00 and less than
$9.00
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Not to exceed $5,750,000
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95.125% of the VWAP
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Equal to or greater than $7.00 and less than
$8.00
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Not to exceed $5,000,000
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95.000% of the VWAP
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Equal to or greater than $6.00 and less than
$7.00
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Not to exceed $4,250,000
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94.750% of the VWAP
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Equal to or greater than $5.00 and less than
$6.00
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Not to exceed $3,500,000
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94.500% of the VWAP
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3
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Equal to or greater than $4.00 and less than
$5.00
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Not to exceed $2,750,000
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94.250% of the VWAP
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Equal to or greater than $3.00 and less than
$4.00
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Not to exceed $2,000,000
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94.000% of the VWAP
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Anything to the contrary in this
Agreement notwithstanding, at no time shall the Investor be
required to purchase more than $11,000,000 worth of Common Stock in
respect of any Pricing Period (not including Common Stock subject
to any Optional Amount). The date on which the Company
delivers any Fixed Request Notice in accordance with this
Section 2.2 hereinafter shall be referred to as a “
Fixed Request Exercise Date ”.
Section 2.3.
Share Calculation . With respect to the Trading
Days during the applicable Pricing Period for which the VWAP equals
or exceeds the Threshold Price, the number of Shares to be issued
by the Company to the Investor pursuant to a Fixed Request shall
equal the aggregate sum of each quotient (calculated for each
Trading Day during the applicable Pricing Period for which the VWAP
equals or exceeds the Threshold Price) determined pursuant to the
following equation (rounded to the nearest whole Share):
N = (A x B)/C, where:
N = the number of Shares to be
issued by the Company to the Investor in respect of a Trading Day
during the applicable Pricing Period for which the VWAP equals or
exceeds the Threshold Price,
A = 0.10 (the “ Multiplier
”),
B = the total Fixed Amount Requested,
and
C = the applicable Discount
Price.
Section 2.4.
Limitation of Fixed Requests . The Company
shall not make more than one Fixed Request in each Pricing
Period. Not less than five Trading Days shall elapse between
the end of one Pricing Period and the commencement of any other
Pricing Period during the Investment Period. There shall be
permitted a maximum of 24 Fixed Requests during the Investment
Period. Each Fixed Request automatically shall expire
immediately following the last Trading Day of each Pricing
Period.
Section 2.5.
Reduction of Commitment . On the last Trading
Day of each Pricing Period, the Investor’s Total Commitment
under this Agreement automatically (and without the need for any
amendment to this Agreement) shall be reduced, on a
dollar-for-dollar basis, by the total amount of the Fixed Request
Amount and the Optional Amount Dollar Amount, if any, for such
Pricing Period paid to the Company at the Settlement
Date.
Section 2.6.
Below Threshold Price . If the VWAP on any
Trading Day in a Pricing Period is lower than the Threshold Price,
then for each such Trading Day the Fixed Amount Requested shall be
reduced, on a dollar-for-dollar basis, by an amount equal to the
product of (x) the Multiplier and (y) the total Fixed
Amount Requested, and no Shares shall be purchased or
4
sold with respect to such Trading Day, except as
provided below. If trading in the Common Stock on NASDAQ (or
any other U.S. national securities exchange on which the Common
Stock is then listed) is suspended for any reason for more than
three hours on any Trading Day, the Investor may at its option deem
the price of the Common Stock to be lower than the Threshold Price
for such Trading Day and, for each such Trading Day, the total
amount of the Fixed Amount Requested shall be reduced as provided
in the immediately preceding sentence, and no Shares shall be
purchased or sold with respect to such Trading Day, except as
provided below. For each Trading Day during a Pricing Period
on which the VWAP is lower (or is deemed to be lower as provided in
the immediately preceding sentence) than the Threshold Price, the
Investor may in its sole discretion elect to purchase such U.S.
dollar amount of Shares equal to the amount by which the Fixed
Amount Requested has been reduced in accordance with this
Section 2.6, at the Threshold Price multiplied by the
applicable percentage determined in accordance with the price and
share amount parameters set forth in Section 2.2. The
Investor shall inform the Company via facsimile transmission not
later than 8:00 p.m. (New York time) on the last Trading Day
of such Pricing Period as to the number of Shares, if any, the
Investor elects to purchase as provided in this
Section 2.6.
Section 2.7.
Settlement
. The payment for, against
simultaneous delivery of, Shares in respect of each Fixed Request
shall be settled on the second Trading Day next following the last
Trading Day of each Pricing Period, or on such earlier date as the
parties may mutually agree (the “ Settlement Date
”). On each Settlement Date, the Company shall deliver
the Shares purchased by the Investor to the Investor or its
designees via DTC’s Deposit/Withdrawal at Custodian (DWAC)
system, against simultaneous payment therefor to the
Company’s designated account by wire transfer of immediately
available funds, provided that if the Shares are received by the
Investor later than 1:00 p.m.
(New York time), payment therefor shall be made with next day
funds. As set forth in Section 9.1(ii), a failure by the
Company to deliver such Shares shall result in the payment of
liquidated damages by the Company to the Investor.
Section 2.8.
Reduction of Pricing
Period . If
during a Pricing Period the Company elects to reduce the number of
Trading Days in such Pricing Period (and thereby amend its
previously delivered Fixed Request Notice), the Company shall so
notify the Investor before 9:00 a.m. (New York time) on any
Trading Day during a Pricing Period (a “ Reduction
Notice ”) and the last Trading Day of such Pricing Period
shall be the Trading Day immediately preceding the Trading Day on
which the Investor received such Reduction Notice; provided,
however , that if the Company delivers the Reduction Notice
later than 9:00 a.m. (New York time) on a Trading Day during a
Pricing Period, then the last Trading Day of such Pricing Period
instead shall be the Trading Day on which the Investor received
such Reduction Notice.
Upon receipt of a Reduction Notice,
the Investor (i) shall purchase the Shares in respect of each
Trading Day in such reduced Pricing Period for which the VWAP
equals or exceeds the Threshold Price in accordance with
Section 2.3 hereof; (ii) may elect to purchase the Shares
in respect of any Trading Day in such reduced Pricing Period for
which the VWAP is (or is deemed to be) lower than the Threshold
Price in accordance with Section 2.6 hereof; and
(iii) may elect to exercise all or any portion of an Optional
Amount on any Trading Day during such reduced Pricing Period in
accordance with Sections 2.10 and 2.11 hereof.
5
In addition, upon receipt of a
Reduction Notice, the Investor may elect to purchase such U.S.
dollar amount of additional Shares equal to the product determined
pursuant to the following equation:
D = (A/B) x (B — C),
where:
D = the U.S. dollar amount of additional
Shares to be purchased,
A = the Fixed Amount Requested,
B = 10 or, for purposes of
this Section 2.8, such lesser number of Trading Days as the
parties may mutually agree to, and
C = the number of Trading Days in the
reduced Pricing Period,
at a per Share price equal to (x) the Fixed
Amount Requested attributable to the reduced Pricing Period divided
by (y) the number of Shares to be purchased during such
reduced Pricing Period pursuant to clauses (i) and
(ii) (as applicable) of the immediately preceding
paragraph.
The Investor may also elect to
exercise any portion of the applicable Optional Amount which was
unexercised during the reduced Pricing Period by issuing an
Optional Amount Notice to the Company not later than
10:00 a.m. (New York time) on the first Trading Day next
following the last Trading Day of the reduced Pricing Period. The
number of Shares to be issued upon exercise of such Optional Amount
shall be calculated pursuant to the equation set forth in
Section 2.10 hereof, except that “ C ”
shall equal the greater of (i) the VWAP for the Common Stock
on the last Trading Day of the reduced Pricing Period or
(ii) the Optional Amount Threshold Price.
The payment for, against
simultaneous delivery of, Shares to be purchased and sold in
accordance with this Section 2.8 shall be settled on the
second Trading Day next following the Trading Day on which the
Investor receives a Reduction Notice.
Section 2.9.
Optional Amount . With respect to any Pricing
Period, the Company may in its sole discretion grant to the
Investor the right to exercise, from time to time during the
Pricing Period (but not more than once on any Trading Day), all or
any portion of an Optional Amount. The maximum Optional
Amount Dollar Amount and the Optional Amount Threshold Price shall
be set forth in the Fixed Request Notice. If an ex-dividend
date is established by the Trading Market in respect of the Common
Stock on or between the first Trading Day of the applicable Pricing
Period and the applicable Settlement Date, the applicable exercise
price in respect of the Optional Amount shall be reduced by the per
share dividend amount. Each daily Optional Amount exercise
shall be aggregated during the Pricing Period and settled on the
next Settlement Date. The Optional Amount Threshold Price
designated by the Company in its Fixed Request Notice shall apply
to each Optional Amount exercised during the applicable Pricing
Period.
Section 2.10.
Calculation of Optional Amount Shares . The
number of shares of Common Stock to be issued in connection with
the exercise of an Optional Amount shall be the quotient determined
pursuant to the following equation (rounded to the nearest whole
Share):
6
O = A/(B x C),
where:
O = the number of shares of
Common Stock to be issued in connection with such Optional Amount
exercise,
A = the Optional Amount Dollar
Amount with respect to which the Investor has delivered an Optional
Amount Notice,
B = the applicable percentage
determined in accordance with the price and shares amount
parameters set forth in Section 2.2 (with the Optional Amount
Threshold Price serving as the Threshold Price for such purposes),
and
C = the greater of
(i) the VWAP for the Common Stock on the day the Investor
delivers the Optional Amount Notice or (ii) the Optional
Amount Threshold Price.
Section 2.11.
Exercise of Optional Amount . If granted by the
Company to the Investor with respect to a Pricing Period, all or
any portion of the Optional Amount may be exercised by the Investor
on any Trading Day during the Pricing Period, subject to the
limitations set forth in Section 2.9. As a condition to
each exercise of an Optional Amount pursuant to this
Section 2.11, the Investor shall issue an Optional Amount
Notice to the Company no later than 8:00 p.m. (New York time)
on the day of such Optional Amount exercise. If the Investor
does not exercise an Optional Amount in full by 8:00 p.m. (New
York time) on the last Trading Day of the applicable Pricing
Period, such unexercised portion of the Investor’s Optional
Amount with respect to that Pricing Period automatically shall
lapse and terminate.
Section 2.12.
Aggregate Limit . Notwithstanding anything to
the contrary contained in this Agreement, in no event may the
Company issue a Fixed Request Notice or grant an Optional Amount to
the extent that the sale of Shares pursuant thereto and pursuant to
all prior Fixed Request Notices and Optional Amounts issued
hereunder, and as liquidated damages pursuant to
Section 9.1(ii), would cause the Company to sell or the
Investor to purchase Shares which in the aggregate are in excess of
the Aggregate Limit. If the Company issues a Fixed Request
Notice or Optional Amount that otherwise would permit the Investor
to purchase shares of Common Stock which would cause the aggregate
purchases by Investor hereunder to exceed the Aggregate Limit, such
Fixed Request Notice or Optional Amount shall be void ab
initio to the extent of the amount by which the dollar value of
shares or number of shares, as the case may be, of Common Stock
otherwise issuable pursuant to such Fixed Request Notice or
Optional Amount together with the dollar value of shares or number
of shares, as the case may be, of all other Common Stock purchased
by the Investor pursuant hereto, or issued as liquidated damages
pursuant to Section 9.1(ii), would exceed the Aggregate
Limit. The Company hereby represents, warrants and covenants
that neither it nor any of its Subsidiaries (i) has effected
any transaction or series of transactions, (ii) is a party to
any pending transaction or series of transactions or
(iii) shall enter into any contract, agreement,
agreement-in-principle, arrangement or understanding with respect
to, or shall effect, any Other Financing which, in any of such
cases, may be aggregated with the transactions contemplated by this
Agreement for purposes of determining whether approval of the
Company’s stockholders is required under any bylaw, listed
securities maintenance standards or other rules of the Trading
Market; provided , however , that the
7
Company shall be permitted to take any action
referred to in clause (iii) above if the Company has timely
provided the Investor with an Integration Notice as provided in
Section 5.6(ii) hereof.
At the Company’s sole
discretion, and effective automatically upon delivery of notice by
the Company to the Investor, this Agreement may be amended by the
Company from time to time to reduce the Aggregate Limit by a
specified dollar amount and/or number of Common Stock as shall be
determined by the Company in its sole discretion; provided ,
however , that any such amendment of this Agreement (and any
such purported amendment) shall be void and of no force and effect
if the effect thereof would restrict, materially delay, conflict
with or impair the ability or right of the Company to perform its
obligations under this Agreement in connection with a previously
provided Fixed Request Notice or the settlement thereof, including,
without limitation, the obligation of the Company to deliver Shares
to the Investor in respect of a previously provided Fixed Request
or Optional Amount on an applicable Settlement Date. In the
event the Company shall have elected to reduce the Aggregate Limit
as provided in the immediately preceding sentence, at the
Company’s sole discretion, and effective automatically upon
delivery of notice by the Company to the Investor, the Company may
subsequently amend this Agreement to increase the Aggregate Limit
up to $60,000,000; subject in all cases to the Trading Market
Limit; provided , however , that in no event shall
the Company be entitled to issue Fixed Requests and grant Optional
Amounts during the remainder of the Investment Period for an
aggregate amount greater than the amount obtained by subtracting
(x) the aggregate of all Fixed Request Amounts and Optional
Amount Dollar Amounts (including any amounts paid as liquidated
damages pursuant to Section 9.1(ii) hereunder) covered by
all Fixed Requests and Optional Amounts theretofore issued or
granted by the Company in respect of which a settlement has
occurred pursuant to Section 2.7 from (y) $60,000,000,
subject in all cases to the Trading Market Limit.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE INVESTOR
The Investor hereby makes the
following representations and warranties to the Company:
Section 3.1.
Organization and Standing of the Investor . The
Investor is an international business company duly organized,
validly existing and in good standing under the laws of the British
Virgin Islands.
Section 3.2.
Authorization and Power . The Investor has the
requisite corporate power and authority to enter into and perform
its obligations under this Agreement and to purchase the Shares in
accordance with the terms hereof. The execution, delivery and
performance of this Agreement by the Investor and the consummation
by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate action, and no further
consent or authorization of the Investor, its Board of Directors or
stockholders is required. This Agreement has been duly
executed and delivered by the Investor. This Agreement
constitutes a valid and binding obligation of the Investor
enforceable against it in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship,
receivership, or similar laws relating to, or affecting generally
the enforcement of, creditor’s rights and remedies or by
other equitable principles of general application.
8
Section 3.3.
No Conflicts . The execution, delivery and
performance by the Investor of this Agreement and the consummation
by the Investor of the transactions contemplated herein do not and
shall not (i) result in a violation of such Investor’s
charter documents, bylaws or other applicable organizational
instruments, (ii) conflict with, constitute a default (or an
event which, with notice or lapse of time or both, would become a
default) under, or give rise to any rights of termination,
amendment, acceleration or cancellation of, any material agreement,
mortgage, deed of trust, indenture, note, bond, license, lease
agreement, instrument or obligation to which the Investor is a
party or is bound, (iii) create or impose any lien, charge or
encumbrance on any property of the Investor under any agreement or
any commitment to which the Investor is party or under which the
Investor is bound or under which any of its properties or assets
are bound, or (iv) result in a violation of any federal,
state, local or foreign statute, rule, or regulation, or any order,
judgment or decree of any court or governmental agency applicable
to the Investor or by which any of its properties or assets are
bound or affected, except, in the case of clauses (ii),
(iii) and (iv), for such conflicts, defaults, terminations,
amendments, acceleration, cancellations and violations as would
not, individually or in the aggregate, prohibit or otherwise
interfere with the ability of the Investor to enter into and
perform its obligations under this Agreement in any material
respect. The Investor is not required under federal, state,
local or foreign law, rule or regulation to obtain any
consent, authorization or order of, or make any filing or
registration with, any court or governmental agency in order for it
to execute, deliver or perform any of its obligations under this
Agreement or to purchase the Shares in accordance with the terms
hereof.
Section 3.4.
Information . All materials relating to the
business, financial condition, management and operations of the
Company and materials relating to the offer and sale of the Shares
which have been requested by the Investor have been furnished or
otherwise made available to the Investor or its advisors (subject
to Section 5.12 of this Agreement). The Investor and its
advisors have been afforded the opportunity to ask questions of
representatives of the Company. The Investor has sought such
accounting, legal and tax advice as it has considered necessary to
make an informed investment decision with respect to its
acquisition of the Shares. The Investor understands that it
(and not the Company) shall be responsible for its own tax
liabilities that may arise as a result of this investment or the
transactions contemplated by this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in the
disclosure schedule delivered by the Company to the Investor (which
is hereby incorporated by reference in, and constitutes an integral
part of, this Agreement) (the “ Disclosure Schedule
”), the Company hereby makes the following representations
and warranties to the Investor:
Section 4.1.
Organization, Good Standing and Power . The
Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Washington and has the
requisite corporate power and authority to own, lease and operate
its properties and assets and to conduct its business as it is now
being conducted. The Company and each Subsidiary is duly
qualified as a foreign corporation to do business and is in good
standing in every jurisdiction in which the nature of the business
conducted or property owned by it
9
makes such qualification necessary, except for
any jurisdiction in which the failure to be so qualified would not
have a Material Adverse Effect.
Section 4.2.
Authorization, Enforcement . The Company has
the requisite corporate power and authority to enter into and
perform this Agreement and to issue and sell the Shares in
accordance with the terms hereof. Except for approvals of the
Company’s Board of Directors or a committee thereof as may be
required in connection with any issuance and sale of Shares to the
Investor hereunder (which approvals shall be obtained prior to the
delivery of any Fixed Request Notice), the execution, delivery and
performance by the Company of this Agreement and the consummation
by it of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action and no further
consent or authorization of the Company or its Board of Directors
or stockholders is required. This Agreement has been duly
executed and delivered by the Company and constitutes a valid and
binding obligation of the Company enforceable against the Company
in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation, conservatorship, receivership or similar
laws relating to, or affecting generally the enforcement of,
creditor’s rights and remedies or by other equitable
principles of general application.
Section 4.3.
Capitalization . The authorized capital stock
of the Company and the shares thereof issued and outstanding are as
set forth in the Commission Documents as of the dates reflected
therein. All of the outstanding shares of Common Stock have
been duly authorized and validly issued, and are fully paid and
nonassessable. Except as set forth in the Commission
Documents, as of the Effective Date, no shares of Common Stock were
entitled to preemptive rights or registration rights and there were
no outstanding options, warrants, scrip, rights to subscribe to,
call or commitments of any character whatsoever relating to, or
securities or rights convertible into or exchangeable for, any
shares of capital stock of the Company, other than those issued or
granted in the ordinary course of business. Except as set
forth in the Commission Documents, as of the Effective Date, there
were no contracts, commitments, understandings, or arrangements by
which the Company is or may become bound to issue additional shares
of the capital stock of the Company or options, securities or
rights convertible into or exchangeable for any shares of capital
stock of the Company. Except for customary transfer
restrictions contained in agreements entered into by the Company to
sell restricted securities or as set forth in the Commission
Documents, as of the Effective Date, the Company was not a party
to, and it had no knowledge of, any agreement restricting the
voting or transfer of any shares of the capital stock of the
Company. Except as set forth in the Commission Documents, the
offer and sale of all capital stock, convertible or exchangeable
securities, rights, warrants or options of the Company issued prior
to the Effective Date complied with all applicable federal and
state securities laws, and no stockholder has any right of
rescission or damages or any “put” or similar right
with respect thereto that would have a Material Adverse
Effect. The Company has furnished or made available to the
Investor via the Commission’s Electronic Data Gathering,
Analysis and Retrieval System (“ EDGAR ”) true
and correct copies of the Company’s Articles of Incorporation
as in effect on the Effective Date (the “ Charter
”), and the Company’s Bylaws as in effect on the
Effective Date (the “ Bylaws ”), and true and
correct copies (redacted as appropriate) of all executed
resolutions of the Company’s Board of Directors (and
committees thereof) relating to the capital stock of the Company
(and transactions in respect thereof) since December 31, 2005
(except with respect to issuances of shares of capital stock
of
10
the Company to directors or employees of the
Company as fees or compensation that were duly approved by the
Company’s Board of Directors or a committee
thereof).
Section 4.4.
Issuance of Shares . The Shares to be issued
under this Agreement have been or will be duly authorized by all
necessary corporate action and, when paid for or issued in
accordance with the terms hereof, the Shares shall be validly
issued and outstanding, fully paid and nonassessable, and, when the
Shares have been issued to the Investor, the Investor shall be
entitled to all rights accorded to a holder and beneficial owner of
Common Stock.
Section 4.5.
No Conflicts . The execution, delivery and
performance by the Company of this Agreement and the consummation
by the Company of the transactions contemplated herein do not and
shall not (i) result in a violation of any provision of the
Company’s Charter or Bylaws, (ii) conflict with,
constitute a default (or an event which, with notice or lapse of
time or both, would become a default) under, or give rise to any
rights of termination, amendment, acceleration or cancellation of,
any material agreement, mortgage, deed of trust, indenture, note,
bond, license, lease agreement, instrument or obligation to which
the Company or any of its Significant Subsidiaries is a party or is
bound (including, without limitation, any listing agreement with
the Trading Market), (iii) create or impose a lien, charge or
encumbrance on any property of the Company or any of its
Significant Subsidiaries under any agreement or any commitment to
which the Company or any of its Significant Subsidiaries is a party
or under which the Company or any of its Significant Subsidiaries
is bound or under which any of their respective properties or
assets are bound, or (iv) result in a violation of any
federal, state, local or foreign statute, rule, regulation, order,
judgment or decree applicable to the Company or any of its
Subsidiaries or by which any property or asset of the Company or
any of its Subsidiaries are bound or affected, except, in the case
of clauses (ii), (iii) and (iv), for such conflicts, defaults,
terminations, amendments, acceleration, cancellations, liens,
charges, encumbrances and violations as would not, individually or
in the aggregate, have a Material Adverse Effect. The Company
is not required under federal, state, local or foreign law,
rule or regulation to obtain any consent, authorization or
order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform
any of its obligations under this Agreement, or to issue and sell
the Shares to the Investor in accordance with the terms hereof
(other than any filings which may be required to be made by the
Company with the Commission or the Trading Market subsequent to the
Effective Date, including but not limited to a Prospectus
Supplement under Sections 1.4 and 5.9 of this Agreement, and any
registration statement, prospectus or prospectus supplement which
has been or may be filed pursuant to this Agreement).
Section 4.6.
Commission Documents, Financial Statements .
(a) The Common Stock is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act and,
except as disclosed in the Commission Documents, as of the
Effective Date the Company had timely filed (giving effect to
permissible extensions in accordance with Rule 12b-25 under
the Exchange Act) all Commission Documents. The Company has
delivered or made available to the Investor via EDGAR or otherwise
true and complete copies of the Commission Documents filed with the
Commission prior to the Effective Date (including, without
limitation, the 2008 Form 10-K) and has delivered or made
available to the Investor via EDGAR or otherwise true and complete
copies of all of the Commission Documents heretofore incorporated
by reference in the Registration Statement and the
Prospectus. The Company has not provided to the Investor
any
11
information which, according to applicable law,
rule or regulation, should have been disclosed publicly by the
Company but which has not been so disclosed, other than with
respect to the transactions contemplated by this Agreement.
As of its filing date, each Commission Document filed with the
Commission and incorporated by reference in the Registration
Statement and the Prospectus (including, without limitation, the
2008 Form 10-K) complied in all material respects with the
requirements of the Securities Act or the Exchange Act, as
applicable, and other federal, state and local laws, rules and
regulations applicable to it, and, as of its filing date (or, if
amended or superseded by a filing prior to the Effective Date, on
the date of such amended or superseded filing), such Commission
Document did not contain any untrue statement of a material fact or
omit 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.
Each Commission Document to be filed with the Commission after the
Effective Date and incorporated by reference in the Registration
Statement, the Prospectus and any Prospectus Supplement required to
be filed pursuant to Sections 1.4 and 5.9 hereof during the
Investment Period (including, without limitation, the Current
Report), when such document becomes effective or is filed with the
Commission, as the case may be, shall comply in all material
respects with the requirements of the Securities Act or the
Exchange Act, as applicable, and other federal, state and local
laws, rules and regulations applicable to it, and shall not
contain any untrue statement of a material fact or omit 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.
(b)
The financial statements, together with the related notes and
schedules, of the Company included in the Commission Documents
comply as to form in all material respects with all applicable
accounting requirements and the published rules and
regulations of the Commission and all other applicable
rules and regulations with respect thereto. Such
financial statements, together with the related notes and
schedules, have been prepared in accordance with GAAP applied on a
consistent basis during the periods involved (except (i) as
may be otherwise indicated in such financial statements or the
notes thereto or (ii) in the case of unaudited interim
statements, to the extent they may not include footnotes or may be
condensed or summary statements and are subject to normal year-end
audit adjustments), and fairly present in all material respects the
financial condition of the Company and its consolidated
Subsidiaries as of 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 year-end audit
adjustments).
(c)
The Company has timely filed with the Commission and made available
to the Investor via EDGAR or otherwise all certifications and
statements required by (x) Rule 13a-14 or
Rule 15d-14 under the Exchange Act or (y) 18 U.S.C.
Section 1350 (Section 906 of the Sarbanes-Oxley Act of
2002 (“ SOXA ”)) with respect to all relevant
Commission Documents. The Company is in compliance in all
material respects with the provisions of SOXA applicable to it as
of the date hereof. The Company maintains disclosure controls
and procedures required by Rule 13a-15 or Rule 15d-15
under the Exchange Act; such controls and procedures are effective
to ensure that all material information concerning the Company and
its Subsidiaries is made known on a timely basis to the individuals
responsible for the timely and accurate preparation of the
Company’s Commission filings and other public disclosure
documents. As used in this Section 4.6(c), the term
“ file ” shall be broadly construed to include
any manner in
12
which a document or information is furnished,
supplied or otherwise made available to the Commission.
(d)
KPMG LLP, who have expressed their opinions on the audited
financial statements and related schedules included or incorporated
by reference in the Registration Statement and the Base Prospectus
are, with respect to the Company, independent public accountants as
required by the Securities Act and is an independent registered
public accounting firm within the meaning of SOXA as required by
the rules of the Public Company Accounting Oversight
Board.
Section 4.7.
Subsidiaries . NeoRx Manufacturing
Group, Inc. (“NMG”), a corporation organized under
Washington law, is the only Subsidiary of the Company as of the
Effective Date. NMG is wholly-owned by the
Company.
Section 4.8.
No Material Adverse Effect . Since
December 31, 2008, the Company has not experienced or suffered
any Material Adverse Effect, and there exists no current state of
facts, condition or event which would have a Material Adverse
Effect, except (i) as disclosed in any Commission Documents
filed since December 31, 2008 or (ii) continued losses
from operations.
Section 4.9.
Indebtedness . The Company’s Quarterly
Report on Form 10-Q for its fiscal quarter ended June 30,
2009 sets forth, as of June 30, 2009, all outstanding secured
and unsecured Indebtedness of the Company or any Subsidiary, or for
which the Company or any Subsidiary has commitments through such
date. For the purposes of this Agreement, “
Indebtedness ” shall mean (a) any liabilities for
borrowed money or amounts owed in excess of $10,000,000 (other than
trade accounts payable incurred in the ordinary course of
business), (b) all guaranties, endorsements, indemnities and
other contingent obligations in respect of Indebtedness of others
in excess of $10,000,000, whether or not the same are or should be
reflected in the Company’s balance sheet (or the notes
thereto), except guaranties by endorsement of negotiable
instruments for deposit or collection or similar transactions in
the ordinary course of business; and (c) the present value of
any lease payments in excess of $10,000,000 due under leases
required to be capitalized in accordance with GAAP. There is
no existing or continuing default or event of default in respect of
any Indebtedness of the Company or any of its
Subsidiaries.
Section 4.10.
Title To Assets . Each of the Company and its
Subsidiaries has good and marketable title to all of their
respective real and personal property reflected in the Commission
Documents, free of mortgages, pledges, charges, liens, security
interests or other encumbrances, except for those indicated in the
Commission Documents or those that would not have a Material
Adverse Effect. To the Company’s knowledge, all real
property leases of the Company are valid and subsisting and in full
force and effect in all material respects.
Section 4.11.
Actions Pending . There is no action, suit,
claim, investigation or proceeding pending, or to the knowledge of
the Company threatened, against the Company or any Subsidiary which
questions the validity of this Agreement or the transactions
contemplated hereby or any action taken or to be taken pursuant
hereto or thereto. Except as set forth in the Commission
Documents, there is no action, suit, claim, investigation or
proceeding pending, or
13
to the knowledge of the Company threatened,
against or involving the Company, any Subsidiary or any of their
respective properties or assets, or involving any officers or
directors of the Company or any of its Subsidiaries, including,
without limitation, any securities class action lawsuit or
stockholder derivative lawsuit, in each case which, if determined
adversely to the Company, its Subsidiary or any officer or director
of the Company or its Subsidiaries, would have a Material Adverse
Effect.
Section 4.12.
Compliance With Law . The business of the
Company and the Subsidiaries has been and is presently being
conducted in compliance with all applicable federal, state, local
and foreign governmental laws, rules, regulations and ordinances,
except as set forth in the Commission Documents and except for such
non-compliance which, individually or in the aggregate, would not
have a Material Adverse Effect.
Section 4.13.
Certain Fees . Except for the placement fee
payable by the Company to Reedland Capital Partners, an
Institutional Division of Financial West Group, Member FINRA/SIPC
(“ Reedland ”), which shall be set forth in a
separate engagement letter between the Company and Reedland (a true
and complete fully executed copy of which has heretofore been
provided to the Investor), no brokers, finders or financial
advisory fees or commissions shall be payable by the Company or any
Subsidiary (or any of their respective affiliates) with respect to
the transactions contemplated by this Agreement.
Section 4.14.
Operation of Business . (a) The Company
or one or more of its Subsidiaries possesses such permits,
licenses, approvals, consents and other authorizations (including
licenses, accreditation and other similar documentation or
approvals of any local health departments) (collectively, “
Governmental Licenses ”) issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies,
including, without limitation, the United States Food and Drug
Administration (“ FDA ”), necessary to conduct
the business now operated by it, except where the failure to
possess such Governmental Licenses, individually or in the
aggregate, would not have a Material Adverse Effect. The
Company and its Subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses and all applicable FDA
rules and regulations, guidelines and policies, and all
applicable rules and regulations, guidelines and policies of
any governmental authority exercising authority comparable to that
of the FDA (including any non-governmental authority whose approval
or authorization is required under foreign law comparable to that
administered by the FDA), except where the failure to so comply,
individually or in the aggregate, would not have a Material Adverse
Effect. All of the Governmental Licenses are valid and in
full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses
to be in full force and effect, individually or in the aggregate,
would not have a Material Adverse Effect. As to each product
that is subject to FDA regulation or similar legal provisions in
any foreign jurisdiction that is developed, manufactured, tested,
packaged, labeled, marketed, sold, distributed and/or
commercialized by the Company or any of its Subsidiaries, each such
product is being developed, manufactured, tested, packaged,
labeled, marketed, sold, distributed and/or commercialized in
compliance with all applicable requirements of the FDA (and any
non-governmental authority whose approval or authorization is
required under foreign law comparable to that administered by the
FDA), including, but not limited to, those relating to
investigational use, investigational device exemption, premarket
notification, premarket approval, good clinical practices, good
manufacturing practices, record keeping, filing of
reports,
14
and patient privacy and medical record security,
except where such non-compliance, individually or in the aggregate,
would not have a Material Adverse Effect. As to each product
or product candidate of the Company or any of its Subsidiaries
subject to FDA regulation or similar legal provision in any foreign
jurisdiction, all manufacturing facilities of the Company and its
Subsidiaries are operated in compliance with the FDA’s
Quality System Regulation requirements at 21 C.F.R. Part 820,
as applicable, except where such non-compliance, individually or in
the aggregate, would not have a Material Adverse Effect.
Except as set forth in the Commission Documents or the Registration
Statement, neither the Company nor any of its Subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses or relating to a
potential violation of, failure to comply with, or request to
produce additional information under, any FDA rules and
regulations, guidelines or policies which, if the subject of any
unfavorable decision, ruling or finding, individually or in the
aggregate, would have a Material Adverse Effect. Except as
set forth in the Commission Documents or the Registration
Statement, neither the Company nor any of its Subsidiaries has
received any correspondence, notice or request from the FDA,
including, without limitation, notice that any one or more products
or product candidates of the Company or any of its Subsidiaries
failed to receive approval from the FDA for use for any one or more
indications. This Section 4.14 does not relate to
environmental matters, such items being the subject of
Section 4.15.
(b)
Except as set forth in the Commission Documents, the Company or one
or more of its Subsidiaries owns or possesses adequate patents,
patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names, trade dress, logos,
copyrights and other intellectual property, including, without
limitation, all of the intellectual property described in the
Commission Documents as being owned or licensed by the Company
(collectively, “ Intellectual Property ”),
necessary to carry on the business now operated by it, except where
failure to own, license, or have such rights would not,
individually or in the aggregate, have a Material Adverse
Effect.. Except as set forth in the Commission Documents,
there are no actions, suits or judicial proceedings pending, or to
the Company’s knowledge threatened, relating to patents or
proprietary information to which the Company or any of its
Subsidiaries is a party or of which any property of the Company or
any of its Subsidiaries is subject, and neither the Company nor any
of its Subsidiaries has received any notice or is otherwise aware
of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid
or inadequate to protect the interest of the Company and its
Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, individually or in the aggregate, would
have a Material Adverse Effect.
(c)
All pre-clinical and clinical trials conducted by, or on behalf of,
the Company or any of its Subsidiaries, or in which the Company or
any of its Subsidiaries has participated that are described in the
Registration Statement or the Commission Documents, or the results
of which are referred to in the Registration Statement or the
Commission Documents, if any, are the only pre-clinical and
clinical trials currently being conducted by or on behalf of the
Company and its Subsidiaries. To the Company’s
knowledge, all such pre-clinical and clinical trials have been
conducted in material compliance with all applicable federal,
state, local
15
and foreign laws, and the regulations and
requirements of any applicable governmental entity, including, but
not limited to, FDA good clinical practice and good laboratory
practice requirements (or the foreign equivalent
requirements). Except as set forth in the Registration
Statement or the Commission Documents or as would not likely result
in a Material Adverse Effect, neither the Company nor any of its
Subsidiaries has received any notices or correspondence from the
FDA or any other governmental agency requiring the termination,
suspension, delay or modification of any pre-clinical or clinical
trials conducted by, or on behalf of, the Company or any of its
Subsidiaries or in which the Company or any of its Subsidiaries has
participated that are described in the Registration Statement or
the Commission Documents, if any, or the results of which are
referred to in the Registration Statement or the Commission
Documents. To the Company’s knowledge, all pre-clinical
and clinical trials previously conducted by, or on behalf of, the
Company or any of its Subsidiaries while conducted by or on behalf
of the Company or any of its Subsidiaries, were conducted in
material compliance with all applicable federal, state, local and
foreign laws, and the regulations and requirements of any
applicable governmental entity, including, but not limited to, FDA
good clinical practice and good laboratory practice requirements
(or the foreign equivalent requirements).
Section 4.15.
Environmental Compliance . Except as disclosed
in the Commission Documents, the Company and each of its
Subsidiaries have obtained all material approvals, authorization,
certificates, consents, licenses, orders and permits or other
similar authorizations of all governmental authorities, or from any
other person, that are required under any Environmental Laws,
except for any approvals, authorization, certificates, consents,
licenses, orders and permits or other similar authorizations the
failure of which to obtain does not or would not have a Material
Adverse Effect. “ Environmental Laws ”
shall mean all applicable laws relating to the protection of the
environment including, without limitation, all requirements
pertaining to reporting, licensing, permitting, controlling,
investigating or remediating emissions, discharges, releases or
threatened releases of hazardous substances, chemical substances,
pollutants, contaminants or toxic substances, materials or wastes,
whether solid, liquid or gaseous in nature, into the air, surface
water, groundwater or land, or relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of hazardous substances, chemical substances,
pollutants, contaminants or toxic substances, material or wastes,
whether solid, liquid or gaseous in nature. Except for such
instances as would not, individually or in the aggregate, have a
Material Adverse Effect, to the Company’s knowledge, there
are no past or present events, conditions, circumstances,
incidents, actions or omissions relating to or in any way affecting
the Company or its Subsidiaries that violate or would reasonably be
expected to violate any Environmental Law after the Effective Date
or that would reasonably be expected to give rise to any
environmental liability, or otherwise form the basis of any claim,
action, demand, suit, proceeding, hearing, study or investigation
(i) under any Environmental Law, or (ii) based on or
related to the manufacture, processing, distribution, use,
treatment, storage (including without limitation underground
storage tanks), disposal, transport or handling, or the emission,
discharge, release or threatened release of any hazardous
substance.
Section 4.16.
Material Agreements . Except as set forth in
the Commission Documents, neither the Company nor any Subsidiary of
the Company is a party to any written or oral contract, instrument,
agreement commitment, obligation, plan or arrangement, a copy of
which would be required to be filed with the Commission as an
exhibit to an annual report on Form 10-K (collectively,
“ Material Agreements ”). Except as set
forth in the Commission
16
Documents, the Company and each of its
Subsidiaries have performed in all material respects all the
obligations required to be performed by them under the Material
Agreements, have received no notice of default or an event of
default by the Company or any of its Subsidiaries thereunder and
are not aware of any basis for the assertion thereof, and neither
the Company or any of its Subsidiaries nor, to the knowledge of the
Company, any other contracting party thereto are in default under
any Material Agreement now in effect, the result of which would
have a Material Adverse Effect. Each of the Material
Agreements is in full force and effect, and constitutes a legal,
valid and binding obligation enforceable in accordance with its
terms against the Company and/or any of its Subsidiaries and, to
the knowledge of the Company, each other contracting party thereto,
except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or
affecting generally the enforcement of, creditor’s rights and
remedies or by other equitable principles of general
application.
Section 4.17.
Transactions With
Affiliates .
Except as set forth in the Commission Documents, there are no
loans, leases, agreements, contracts, royalty agreements,
management contracts, service arrangements or other continuing
transactions exceeding $120,000 between (a) the Company or any
Subsidiary, on the one hand, and (b) any person or entity who
would be covered by Item 404(a) of Regulation S-K, on the
other hand. Except as disclosed in the Commission Documents,
there are no outstanding amounts payable to or receivable from, or
advances by the Company or any of its Subsidiaries to, and neither
the Company nor any of its Subsidiaries is otherwise a creditor of
or debtor to, any beneficial owner of more than 5% of the
outstanding shares of Common Stock, or any director, employee or
affiliate of the Company or any of its Subsidiaries, other than
(i) reimbursement for reasonable expenses incurred on behalf
of the Company or any of its Subsidiaries or (ii) as part of
the normal and customary terms of such persons’ employment or
service as a director with the Company or any of its
Subsidiaries.
Section 4.18.
Securities Act; NASD Conduct
Rules . The
Company has complied with all applicable federal and state
securities laws in connection with the offer, issuance and sale of
the Shares hereunder.
(i)
The Company has prepared and filed
with the Commission in accordance with the provisions of the
Securities Act the Registration Statement, including a base
prospectus relating to the Shares. The Registration Statement was
declared effective by order of the Commission on June 2, 2009.
As of the date hereof, no stop order suspending the effectiveness
of the Registration Statement has been issued by the Commission or
is continuing in effect under the Securities Act and no proceedings
therefor are pending before or, to the Company’s knowledge,
threatened by the Commission. No order preventing or
suspending the use of the Prospectus or any Permitted Free Writing
Prospectus has been issued by the Commission.
(ii)
The Company satisfies all of the
requirements for the use of Form S-3 for the offering and sale
of the Shares contemplated by this Agreement (without reliance on
General Instruction I.B.6. of Form S-3). The Commission has
not notified the Company of any objection to the use of the form of
the Registration Statement pursuant to
Rule 401(g)(1) under the Securities Act. The Registration
Statement complied in all material respects on the date on which it
was declared effective by the Commission, and will comply in all
material respects at
17
each deemed effective date with respect to the
Investor pursuant to Rule 430B(f)(2) of the Securities
Act, with the requirements of the Securities Act, and the
Registration Statement (including the documents incorporated by
reference therein) did not on the date it was declared effective by
the Commission, and shall not at each deemed effective date with
respect to the Investor pursuant to Rule 430 B (f) (2)
of the Securities Act, contain an 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;
provided that this representation and warranty does not
apply to statements in or omissions from the Registration Statement
made in reliance upon and in conformity with information relating
to the Investor furnished to the Company in writing by or on behalf
of the Investor expressly for use therein. The Registration
Statement, as of the Effective Date, meets the requirements set
forth in Rule 415(a)(1)(x) under the Securities
Act. The Base Prospectus complied in all material respects on
its date and on the Effective Date, and will comply in all material
respects on each applicable Fixed Request Exercise Date and, when
taken together with the applicable Prospectus Supplement and any
applicable Permitted Free Writing Prospectus, on each applicable
Settlement Date, with the requirements of the Securities Act and
did not on its date and on the Effective Date and shall not on each
applicable Fixed Request Exercise Date and, when taken together
with the applicable Prospectus Supplement and any applicable
Permitted Free Writing Prospectus, on each applicable Settlement
Date contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided that
this rep
