Exhibit 10.1
SECURITIES PURCHASE
AGREEMENT
This Securities Purchase Agreement
(“ Agreement ”) is made as of
February 13, 2009 (the “ Effective Date
”), by and among Cadence Pharmaceuticals, Inc., a Delaware
corporation (the “ Company ”), and each
of those persons and entities, severally and not jointly, listed as
a Purchaser on the Schedule of Purchasers attached as Exhibit
A hereto (the “ Schedule of Purchasers
”). Such persons and entities are hereinafter collectively
referred to as “ Purchasers ” and each
individually as a “ Purchaser
”.
AGREEMENT
In consideration of the mutual
covenants contained in this Agreement, and for other good and
valuable consideration, the receipt of which is hereby
acknowledged, the Company and each Purchaser (severally and not
jointly) hereby agree as follows:
SECTION 1. AUTHORIZATION OF SALE
OF SECURITIES.
The Company has authorized the sale
and issuance of 12,039,794 shares of its Common Stock, par value
$0.0001 per share (the “ Common Stock ”),
and warrants in the form of Exhibit B hereto to purchase an
aggregate of 6,019,897 shares of Common Stock (each a “
Warrant ,” and collectively, the “
Warrants ”), on the terms and subject to the
conditions set forth in this Agreement. The shares of Common Stock
sold hereunder at the Closing (as defined below) shall be referred
to as the “ Shares .” The Shares and the
Warrants shall be referred to collectively as the “
Securities .”
SECTION 2. AGREEMENT TO SELL AND
PURCHASE THE SECURITIES.
2.1 Sale of Securities . At
the Closing (as defined in Section 3), the Company will sell
to each Purchaser, and each Purchaser will purchase from the
Company, (a) the number of Shares set forth opposite such
Purchaser’s name on the Schedule of Purchasers at a purchase
price of $7.13 per Share and (b) a Warrant to purchase the
number of shares of Common Stock set forth opposite such
Purchaser’s name on the Schedule of Purchasers (such shares
of Common Stock, the “ Warrant Shares ”),
which Warrant shall have an exercise price equal to $7.84 per
Warrant Share, and which Warrant shall have a purchase price equal
to $0.125 per Warrant Share underlying such Warrant.
2.2 Separate Agreement . Each
Purchaser shall severally, and not jointly, be liable for only the
purchase of the Securities that appear on the Schedule of
Purchasers that relate to such Purchaser. The Company’s
agreement with each of the Purchasers is a separate agreement, and
the sale of Securities to each of the Purchasers is a separate
sale. The obligations of each Purchaser hereunder are expressly not
conditioned on the purchase by any or all of the other Purchasers
of the Securities such other Purchasers have agreed to
purchase.
SECTION 3. CLOSING AND
DELIVERY.
3.1 Closing . The closing of
the purchase and sale of the Securities (which Securities are set
forth in the Schedule of Purchasers) pursuant to this Agreement
(the “ Closing ”) shall be held on
February 18, 2009 at the offices of Latham & Watkins
LLP, 12636 High Bluff Drive, Suite 400, San Diego, California
92130, or on such other date and place as may be agreed to by the
Company and the Purchasers. At or prior to the Closing, the Company
and each Purchaser shall execute any related agreements or other
documents required to be executed hereunder, dated as of the date
of the Closing (the “ Closing Date
”).
3.2 Issuance of the Securities at
the Closing. At the Closing, the Company shall issue to each
Purchaser (a) stock certificates registered in the name of
such Purchaser, or in such nominee name(s) as designated by such
Purchaser, representing the number of Shares to be purchased by
such Purchaser at such Closing as set forth in the Schedule of
Purchasers, against payment of the purchase price for such Shares
and (b) a Warrant registered in the name of such Purchaser, or
in such nominee name(s) as designated by such Purchaser,
representing the number of Warrant Shares as set forth in the
Schedule of Purchasers. The name(s) in which the stock certificates
and Warrant are to be issued to each Purchaser are set forth in the
Stock Certificate Questionnaire and the Registration Statement
Questionnaire in the form attached hereto as Exhibits C and
D , respectively (the “ Stock Certificate
Questionnaire ” and the “ Registration
Statement Questionnaire ,” respectively), as
completed by each Purchaser, which shall be provided to the Company
no later than the Closing Date. The physical delivery of the stock
certificates and Warrants to each Purchaser shall be made promptly
following the Closing Date.
SECTION 4. REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE COMPANY.
Except as otherwise expressly
described in the Company’s filings with the Securities and
Exchange Commission (the “ Commission ”)
available on EDGAR to the public since December 31, 2007 (the
“ Commission Documents ”), or in the
Company’s press releases, as posted on the website of the
Company in the Investor Relations – News Releases section,
since December 31, 2007 (the “ Press
Releases ,” and together with the Commission
Documents, the “ Company Information ”),
which qualify the following representations and warranties in their
entirety, the Company hereby represents and warrants to, and
covenants with, each Purchaser, as follows:
4.1 Organization and Standing;
Subsidiaries . The Company has been duly organized and is
validly existing as a corporation in good standing under the laws
of the State of Delaware and has corporate power and authority to
own, lease and operate its properties and to conduct its business
as presently conducted, and to enter into and perform its
obligations under this Agreement, the Warrants and the other
documents delivered by the Company pursuant hereto; and the Company
is duly qualified as a foreign corporation to transact business and
is in good standing in each other jurisdiction in which such
qualification is required, except where the failure so to qualify
or to be in good standing, individually or in the aggregate, would
not reasonably be expected to have a material adverse effect on the
assets, liabilities, properties, condition, financial or otherwise,
in the results of operations or business or prospects of the
Company, or materially impair the Company’s ability to
perform its obligations under this Agreement (a “
Company Material Adverse Effect ”). The Company
has no subsidiaries which have incurred any material
liabilities.
4.2 Corporate Power;
Authorization. The Company has the requisite power and
authority to enter into and to consummate the transactions
contemplated by this Agreement, the Warrants and the other
documents delivered by the Company pursuant hereto and otherwise to
carry out its obligations hereunder and thereunder. The execution
and delivery by the Company of this Agreement, the
Warrants and the other documents delivered by
the Company pursuant hereto and the consummation and performance by
it of the transactions contemplated hereunder and thereunder have
been duly authorized by all necessary corporate action on the part
of the Company, and no further consent or action is required by the
Company, its Board of Directors or its stockholders. This
Agreement, the Warrants and the other documents delivered by the
Company pursuant hereto have been duly executed by the Company and,
when delivered in accordance with the terms hereof or thereof, will
constitute the valid and binding obligation of the Company,
enforceable against the Company in accordance with their terms,
except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting
creditors’ and contracting parties’ rights generally
and except as enforceability may be subject to general principles
of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).
4.3 No Conflicts or
Violations . The execution, delivery and performance by the
Company of this Agreement, the Warrants and the other documents
delivered by the Company pursuant hereto and the consummation by
the Company of the transactions contemplated hereby and thereby do
not and will not (i) conflict with or violate any provision of
the Company’s amended and restated certificate of
incorporation or amended and restated bylaws, (ii) conflict
with, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration or
cancellation (with or without notice, lapse of time or both) of, or
give any rights to receipt of any portion of the proceeds from the
sale of the Securities pursuant to, any agreement, credit facility,
debt or other instrument (evidencing a Company debt or otherwise)
to which the Company is a party or by which any property or asset
of the Company is bound or affected, or (iii) result in a
violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or
governmental authority to which the Company is subject (including
federal and state securities laws and regulations) and the rules
and regulations of any self-regulatory organization to which the
Company or its securities are subject, or by which any property or
asset of the Company is bound or affected except in the case of
clauses (ii) and (iii), such as would not, individually or in
the aggregate, be reasonably expected to result in a Company
Material Adverse Effect.
4.4 Governmental Consents. No
consent, approval, authorization, filing with or order of or
registration with, any court or governmental agency or body is
required in connection with the transactions contemplated herein,
except such as have been or will be obtained or made under the
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder (the “ Securities Act
”), or the Securities Exchange Act of 1934, as amended, and
the rule and regulations promulgated thereunder (the “
Exchange Act ”), and such as may be required
under the securities, or blue sky, laws of any state or foreign
jurisdiction in connection with the offer and sale of the
Securities by the Company in the manner contemplated
herein.
4.5 Issuance and Delivery of the
Securities. The Securities have been duly authorized and, when
issued and paid for in compliance with the provisions of this
Agreement, will be validly issued, fully paid and nonassessable.
The Warrant Shares have been duly authorized and, upon exercise of
the Warrants in accordance with their terms, including payment of
the exercise price therefore, will be validly issued, fully paid
and nonassessable. The issuance and delivery of neither the
Securities nor the Warrant Shares is
subject to preemptive, co-sale or any other
similar rights of the stockholders of the Company or any liens or
encumbrances (other than any liens or encumbrances created by or
imposed by the Purchaser purchasing the applicable Securities
pursuant to the terms of this Agreement). Assuming the accuracy of
the representations made by each Purchaser in Section 5, the
offer and issuance by the Company of the Securities is exempt from
registration under the Securities Act.
4.6 Capitalization. All of
the Company’s outstanding shares of capital stock have been
duly authorized and validly issued and are fully paid and
nonassessable, have been issued in compliance with all federal and
state securities laws, and were not issued in violation of or
subject to any preemptive, co-sale or other rights to subscribe for
or purchase securities. The authorized capital stock of the Company
consists of 100,000,000 shares of Common Stock and 10,000,000
shares of undesignated Preferred Stock. As of the Effective Date,
there are no shares of Preferred Stock issued and outstanding and
there are 38,363,985 shares of Common Stock issued, consisting of
38,363,985 shares of Common Stock outstanding and 0 shares of
Common Stock held in treasury. There are no other shares of any
other class or series of capital stock of the Company issued or
outstanding. The Company has no capital stock reserved for
issuance, except that, as of the Effective Date: (i) 50,331
shares of Common Stock are reserved for issuance upon the exercise
of outstanding warrants; (ii) 1,583,180 shares of Common Stock
are subject to currently outstanding stock options issued under the
Company’s 2004 Equity Incentive Award Plan (the “
2004 Plan ”), and no shares of Common Stock
remain available for future issuance under the 2004 Plan; and
(iii) 2,063,250 shares of Common Stock are subject to
currently outstanding stock options issued under the
Company’s 2006 Equity Incentive Award Plan (the “
2006 Plan ”), 0 shares of Common Stock are
outstanding as unvested restricted stock under the 2006 Plan, and
2,489,091 shares of Common Stock remain available for future
issuance under the 2006 Plan. Except as stated above, there are no
outstanding options, warrants, or other rights to purchase, or
equity or debt securities convertible into or exchangeable or
exercisable for, any capital stock of the Company that have been
granted by the Company. The issuance of Common Stock or other
securities pursuant to any provision of this Agreement or the
Warrants will not give rise to any preemptive rights or rights of
first refusal, co-sale rights or any other similar rights on behalf
of any person or result in the triggering of any anti-dilution or
other similar rights. There are no securities or instruments
containing anti-dilution provisions that will be triggered by the
issuance of the Securities or the Warrant Shares.
4.7 Commission Documents;
Financial Statements. Each document filed or to be filed with
the Commission pursuant to the Exchange Act and incorporated by
reference in any Registration Statement complied or will comply
when so filed in all material respects with the Exchange Act.
Except as otherwise disclosed in the Commission Documents, since
December 31, 2007, (i) there have not been any changes in
the assets, liabilities, financial condition or operations of the
Company from that reflected in the financial statements in the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2007 except changes in the ordinary course
of business consistent with past practice that would not be
reasonably expected, either individually or in the aggregate, to
have a Company Material Adverse Effect, (ii) the Company has
not incurred any liabilities (contingent or otherwise) other than
(A) trade payables, accrued expenses and other liabilities
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 Securities and
Exchange Commission (the “ Commission ”),
which would not, individually or in the
aggregate, be reasonably expected to have a
Company Material Adverse Effect, (iii) the Company has not
altered its critical accounting policies, (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 of the Company, except pursuant
to existing Company stock incentive or purchase plans. The Company
does not have pending before the Commission any request for
confidential treatment of information or documents.
4.8 No Proceedings or
Investigations. Except as disclosed in the Company Information,
there is no proceeding, or, to the Company’s knowledge,
inquiry or investigation, before or by any court, public board,
government agency, self-regulatory organization or body pending or,
to the knowledge of the Company, threatened against or affecting
the Company or any of its subsidiaries that would be reasonably
expected, individually or in the aggregate, to have a Company
Material Adverse Effect. Neither the Company or its subsidiaries,
nor any director or officer thereof, is, or within the last ten
years has been, the subject of any action involving a claim of
violation of or liability under federal or state securities laws
relating to the Company or a claim of breach of fiduciary duty
relating to the Company.
4.9 NASDAQ Compliance. The
Company has not, in the twelve months preceding the date hereof,
received notice (written or oral) from the Financial Industry
Regulatory Authority or NASDAQ to the effect that the Company is
not in compliance with the listing or maintenance requirements of
the NASDAQ Global Market. The Company is in compliance with all
such listing and maintenance requirements. The issuance and sale of
the Securities under this Agreement does not contravene the rules
and regulations of the NASDAQ Global Market, and no approval of the
stockholders of the Company thereunder is required for the Company
to issue and deliver the Securities to the Purchasers.
4.10 Sarbanes-Oxley Act . The
Company is in compliance in all material respects with applicable
requirements of the Sarbanes-Oxley Act of 2002 and applicable rules
and regulations promulgated by the Commission
thereunder.
4.11 Disclosure Controls and
Procedures . The Company has established and maintains
disclosure controls and procedures (as defined in Exchange Act
Rules 13a-15(e) and 15d-15(e)) that are effective in all material
respects to ensure that material information relating to the
Company, including its subsidiaries, is made known to its chief
executive officer and chief financial officer by others within
those entities. The Company’s certifying officers have
evaluated the effectiveness of the Company’s controls and
procedures as of December 31, 2007. The Company presented in
its Annual Report on Form 10-K for the fiscal year ended
December 31, 2007 the conclusions of the certifying officers
about the effectiveness of the disclosure controls and procedures
based on their evaluations as of December 31, 2007. Since
December 31, 2007, there have been no significant changes in
the Company’s internal controls (as such term is defined in
Item 307(b) of Regulation S-K under the Exchange Act) or, to
the Company’s knowledge, in other factors that could
significantly affect the Company’s internal
controls.
4.12 No Integrated or Aggregated
Offering. Neither the Company, nor any person acting on its
behalf, has, directly or indirectly, made any offers or sales of
any security or solicited any offers to buy any security, under
circumstances that would cause the offering of Shares contemplated
by this Agreement to be (i) integrated with prior offerings by
the Company for purposes of the Securities Act or
(ii) aggregated with prior offerings by the Company for the
purposes of the rules and regulations of the NASDAQ Global
Market.
4.13 Price of Common Stock .
The Company has not taken, nor will it take, directly or
indirectly, any action designed to stabilize or manipulate the
price of the Common Stock or any security of the Company to
facilitate the sale or resale of the Shares or the Warrant
Shares.
4.14 No General Solicitation
. Neither the Company, nor any of its affiliates, nor any person
acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of
Regulation D promulgated under the Securities Act) in connection
with the offer or sale of the Securities.
4.15 No Registration Rights .
No holder of any security of the Company has any right, which has
not been waived, to have any security owned by such holder included
in the Registration Statements (as such term is defined in
Section 8.1(a)(i)).
4.16 Publicity; Disclosures .
Except as required by law, the Company shall not issue any press
release or make any public statement (excluding information
contained in the Registration Statements (as defined below))
listing any Purchaser as a purchaser of the Shares without the
prior approval of such Purchaser. Notwithstanding the foregoing,
the Company shall be permitted to issue a press release or make a
public statement listing any Purchaser as a purchaser of the Shares
without obtaining the consent of such Purchaser if such press
release or public statement is required by law or the applicable
rules or regulations of the NASDAQ Global Market, any securities
exchange or other securities market. No later than the Trading Day
immediately following the date hereof, the Company shall issue a
press release disclosing the transactions contemplated by this
Agreement. No later than the fourth trading day following the date
hereof, the Company will file a Current Report on Form 8-K
describing the transactions contemplated by this Agreement and
attaching the press release described in the foregoing sentence. To
the Company’s knowledge, 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,
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, except for the announcement of this Agreement and
related transactions and as may be disclosed on the Form 8-K filed
pursuant to this Section 4.16. None of the representations,
warranties, or covenants in this Agreement, the Warrants, or any
agreements, certificates or instruments delivered herewith or
therewith, or other disclosures made to the Purchasers in
connection with the transactions contemplated by this Agreement,
when taken together, contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements contained therein, in light of the circumstances
under which they were made, not misleading.
4.17 Environmental Laws . The
Company (i) is in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to
the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
(“ Environmental Laws ”), (ii) has
received all permits, licenses or other approvals required
under
applicable Environmental Laws to conduct its
business and (iii) is in compliance with all terms and
conditions of any such permit, license or approval, except where
such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply
with the terms and conditions of such permits, licenses or
approvals would not, individually or in the aggregate, be
reasonably expected to have a Company Material Adverse Effect.
There are no costs or liabilities associated with Environmental
Laws, including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any
potential liabilities to third parties, that would, individually or
in the aggregate, be reasonably expected to have a Material Adverse
Effect.
4.18 Title . The Company has
good and marketable title to all personal property owned by it that
is material to the business of the Company, free and clear of all
liens, encumbrances and defects except as described in the
Commission Documents or such as do not materially affect the value
of such property and do not interfere with the use made and
proposed to be made of such property by the Company. Any real
property and buildings held under lease by the Company is held
under valid, subsisting and enforceable leases with such exceptions
as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company.
The Company does not own any real property.
4.19 Intellectual Property
.
(a) All patents and patent
applications filed by or on behalf of the Company (the “
Owned Patents ”) are owned or co-owned by the
Company free and clear of all liens, encumbrances, except with
respect to licenses granted in the ordinary course of business as
such licenses and business are described in the Commission
Documents, defects or other restrictions, except as would not,
singly or in the aggregate, have a Material Adverse Effect; and the
Company is not aware of any valid or bona fide basis for a finding
that any of the Owned Patents in its entirety is (or would after
issuance be) invalid or unenforceable; and the Company reasonably
believes that the Owned Patents are (or will be upon their
issuance) valid and enforceable, except as would not, singly or in
the aggregate, have a Material Adverse Effect.
(b) In connection with the
Company’s Owned Patents, all known relevant prior art
references were disclosed or will be disclosed to the USPTO to the
extent required by and in accordance with 37 C.F.R.
Section 1.56; and neither the Company nor, to the
Company’s knowledge, any other person has made any material
misrepresentations or concealed any material information from the
USPTO in such applications, or in connection with the prosecution
of such applications, in violation of 37 C.F.R.
Section 1.56.
(c) Except as set forth in the
Commission Documents, the Company owns or possesses rights to use,
or can acquire on reasonable terms ownership of or rights to use,
all patents, patent applications, 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 and other intellectual property (collectively, “
Intellectual Property ”) necessary for the
conduct of the Company’s business as now conducted, and for
the manufacture, use or sale of its presently proposed products, as
described in the Commission Documents, and the Company has not
received any written notice of infringement of or conflict with
asserted rights of others with respect to any of the foregoing
that, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would be reasonably expected to have a
Company Material Adverse Effect.
(d) To the Company’s
knowledge, and except as would not be reasonably expected to have a
Company Material Adverse Effect, there are no valid and enforceable
rights of third parties to such Intellectual Property that are or
would be infringed by the business currently conducted by the
Company or in the manufacture, use, sale, offer for sale or import
of its presently proposed products, as described in the Commission
Documents.
(e) Except as set forth in the
Commission Documents, the Intellectual Property owned by the
Company is not subject to any judgment, order, writ, injunction or
decree of any court or any federal, state, local, foreign or other
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, or any arbitrator, except as
would not be reasonably expected to have a Company Material Adverse
Effect.
(f) To the Company’s
knowledge, there are no ongoing infringements by others of any
material Intellectual Property owned by the Company in connection
with the business currently conducted by the Company or its
presently proposed products, as described in the Prospectus, except
as would not be reasonably expected to have a Company Material
Adverse Effect.
(g) Other than as disclosed in the
Commission Documents and except as would not be reasonably expected
to have a Company Material Adverse Effect, to the Company’s
knowledge, there is no U.S. patent or published U.S. patent
application which contains valid and enforceable claims that are
necessary for the conduct of the Company’s business as now
conducted, or for the manufacture, use or sale of its presently
proposed products, as described in the Time of Sale Prospectus and
that dominate or that would dominate any Owned Patent or that
interferes with the issued or pending claims of any such Owned
Patent.
4.20 Registration. The
Company satisfies the registrant requirements for the use of a
registration statement on Form S-3 to register the Shares and the
Warrant Shares for resale by the Purchaser under the Securities
Act.
4.21 Regulatory Compliance
.
(a) The Company has all necessary
consents, authorizations, approvals, orders, certificates and
permits of and from, and has made all required declarations and
filings with, and complied with all formal recommendations of, all
federal, state, local and other governmental authorities, all
self-regulatory organizations and all courts and other tribunals,
to own, lease, license and use its properties and assets and to
conduct its business in the manner described in the Commission
Documents, including, without limitation, all necessary U.S. Food
and Drug Administration (“ FDA ”) and
applicable foreign regulatory agency approvals and recommendations,
except as disclosed in the Commission Documents, and except to the
extent that the failure to obtain such consents, authorizations,
approvals, orders, certificates, permits, or to make such
declarations or filings, or to follow such recommendations would
not, individually or in the aggregate, be reasonably expected to
have a Company Material Adverse
Effect. The Company has not received
any notice of proceedings relating to the revocation or
modification of any such consent, authorization, approval, order,
certificate, permit or recommendation which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would be reasonably expected to have a Company Material
Adverse Effect, except as described in the Commission
Documents.
(b) No investigational new drug
(“ IND ”) application filed by or on
behalf of the Company with the FDA has been terminated by the FDA,
and none of the FDA or any applicable foreign regulatory agency has
recommended, commenced, or, to the knowledge of the Company,
threatened to initiate, any action to place a clinical hold order
on, or otherwise delay or suspend, proposed or ongoing clinical
investigations conducted or proposed to be conducted by or on
behalf of the Company.
(c) To the best of the
Company’s knowledge, all the operations of the Company and
all the manufacturing facilities and operations of the
Company’s suppliers of products and product candidates and
the components thereof manufactured in or imported into the United
States are in compliance with applicable FDA regulations, including
current Good Manufacturing Practices, and meet sanitation standards
set by the Federal Food, Drug and Cosmetic Act of 1938, as amended,
and all the operations of the Company and all the manufacturing
facilities and operations of the Company’s suppliers of
products and product candidates manufactured outside, or exported
from, the United States are in compliance with applicable foreign
regulatory requirements and standards, except to the extent that
the failure to be in compliance with such regulations and standards
would not, individually or in the aggregate, be reasonably expected
to have a Company Material Adverse Effect.
(d) Except as described in the
Commission Documents, the clinical trials and the human and animal
studies that are described in the Commission Documents were and, if
still pending, are being, conducted (to the knowledge of the
Company with respect to such studies conducted by or on behalf of
third parties) in accordance in all material respects with all
applicable rules, regulations and policies of the FDA, including
the current Good Clinical Practices and Good Laboratory Practices,
and all applicable foreign regulatory requirements and
standards.
(e) To the best of the
Company’s knowledge, the Company has operated its business
and currently is in compliance in all material respects with all
applicable rules, regulations and policies of the FDA and any
applicable foreign regulatory organization.
SECTION 5. REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE PURCHASERS.
5.1 Each Purchaser, severally and
not jointly, represents and warrants to and covenants with the
Company that:
(a) Such Purchaser, taking into
account the personnel and resources it can practically bring to
bear on the purchase of the Securities contemplated hereby, is
knowledgeable, sophisticated and experienced in making, and is
qualified to make, decisions with respect to investments in
securities presenting an investment decision like that involved in
the purchase of the Securities,
including investments in securities
issued by the Company, and has requested, received, reviewed and
considered all information such Purchaser deems relevant (including
the Commission Documents) in making an informed decision to
purchase the Securities.
(b) Such Purchaser is acquiring the
Securities pursuant to this Agreement for its own account for
investment only and with no present intention of distributing any
of such Securities or any arrangement or understanding with any
other persons regarding the distribution of such Securities, except
in compliance with Section 5.1(c).
(c) Such Purchaser is an
“accredited investor” within the meaning of Rule 501 of
Regulation D promulgated under the Securities Act or a Qualified
Institutional Buyer within the meaning of Rule 144A promulgated
under the Securities Act.
(d)(i) Such Purchaser is an entity
duly organized and validly existing in good standing (to the extent
such concepts are applicable) under the laws of its jurisdiction of
organization, (ii) such Purchaser has full right, power and
authority to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action
to authorize the execution, delivery and performance of this
Agreement, and (iii) this Agreement constitutes a valid and
binding obligation of such Purchaser enforceable against such
Purchaser in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting
creditors’ and contracting parties’ rights generally
and except as enforceability may be subject to general principles
of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).
(e) Such Purchaser is not a broker
or dealer registered pursuant to Section 15 of the Exchange
Act and, unless otherwise indicated in the Registration Statement
Questionnaire executed by such Purchaser, is not affiliated with a
registered broker dealer. The Purchaser is not party to any
agreement for distribution of any of the Securities.
(f) Such Purchaser shall have
completed or caused to be completed and delivered to the Company at
no later than the Closing Date, the Stock Certificate Questionnaire
and the Registration Statement Questionnaire for use in preparation
of the Registration Statement, and the answers to the Stock
Certificate Questionnaire and the Registration Statement
Questionnaire are true and correct in all material respects as of
the Effective Date and will be true and correct in all material
respects as of the Closing Date and the effective date of the
Registration Statement; provided that such Purchaser shall be
entitled to update such information by providing notice thereof to
the Company before the effective date of such Registration
Statement.
(g) Such Purchaser (including any
person controlling, controlled by, or under common control with
such Purchaser, as the term “control” is defined
pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, and its implementing regulations (the “
HSR Act ”)) does not, and upon the consummation
of the transactions contemplated by this Agreement will not, hold
voting securities of the Company exceeding an aggregate fair market
value as of the Closing Date of sixty-five million two hundred
thousand dollars ($65,200,000), calculated pursuant to the HSR
Act.
5.2 Each Purchaser, severally and
not jointly, represents and warrants to and covenants with the
Company that such Purchaser has not engaged in the ninety
(90) day period ending on the date hereof and will not engage
in any short sales of the Company’s Common Stock prior to the
effectiveness of the Initial Registration Statement (either
directly or indirectly through an affiliate, agent or
representative).
5.3 Each Purchaser, severally and
not jointly, understands that nothing in this Agreement or any
other materials presented to such Purchaser in connection with the
purchase and sale of the Securities constitutes legal, tax or
investment advice. Such Purchaser has consulted such legal, tax and
investment advisors as it, in its sole discretion, has deemed
necessary or appropriate in connection with its purchase of the
Securities.
5.4 Legends. Each Purchaser,
severally and not jointly, understands that the Shares, the
Warrants and the Warrant Shares may bear one or more legends in
substantially the following form and substance:
“THE SECURITIES EVIDENCED BY
THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY
OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE
UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR
OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION
WHICH IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION, IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS, AND IN THE
CASE OF A TRANSACTION EXEMPT FROM, OR NOT SUBJECT TO, SUCH
REGISTRATION, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT
REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND SUCH OTHER
APPLICABLE LAWS.”
In addition, stock certificates
representing the Securities or the Warrant Shares may
contain:
(a) any legend required by the laws
of the State of California, including any legend required by the
California Department of Corporations;
(b) any legend required by the blue
sky laws of any other state to the extent such laws are applicable
to the sale of such Securities or Warrant Shares hereunder;
and
(c) a legend regarding affiliate
status on the stock certificates of the Purchasers set forth in
Schedule 2 hereto, in the form included therein.
5.5 Restricted Securities.
Purchaser understands that the Securities and the Warrant Shares
are characterized as “restricted securities” under the
federal securities laws inasmuch as they are being acquired from
the Company in a transaction not involving a public offering and
that under such laws and applicable regulations such Securities may
be resold without registration under the Securities Act only in
certain limited circumstances. In this connection, such Purchaser
represents that it is familiar with Commission Rule 144, as
presently in effect, and understands the resale limitations imposed
thereby and by the Securities Act.
SECTION 6. CONDITIONS TO
COMPANY’S OBLIGATIONS AT THE CLOSING.
The Company’s obligation to
complete the sale and issuance of the Securities and deliver
Securities to each Purchaser, individually, as set forth in the
Schedule of Purchasers at the Closing shall be subject to the
following conditions to the extent not waived by the
Company:
6.1 Receipt of Payment. The
Company shall have received payment, by wire transfer of
immediately available funds, in the full amount of the purchase
price for the number of Securities being purchased by each
Purchaser at the Closing as set forth in the Schedule of
Purchasers.
6.2 Representations and
Warranties. The representations and warranties made by each
Purchaser in Section 5 hereof shall be true and correct in all
material respects as of, and as if made on, the date of this
Agreement and as of the Closing Date.
6.3 Receipt of Executed
Documents. Each Purchaser shall have executed and delivered to
the Company the Stock Certificate Questionnaire and the
Registration Statement Questionnaire.
6.4 NASDAQ Approval. The
Shares and the Warrant Shares shall have been approved for listing
on the NASDAQ Global Market, subject to official notice of
issuance.
SECTION 7. CONDITIONS TO
PURCHASERS’ OBLIGATIONS AT THE CLOSING.
Each Purchaser’s obligation to
accept delivery of the Securities being purchased by such Purchaser
at the Closing as set forth in the Schedule of Purchasers and to
pay for such Securities shall be subject to the following
conditions to the extent not waived by such Purchaser:
7.1 Representations and
Warranties Correct. The representations and warranties made by
the Company in Section 4 hereof shall be true and correct in
all material respects (except to the extent that such
representations and warranties are qualified by materiality,
material adverse effect, or words of like effect, in which case
such representations and warranties shall be true in all respects)
as of, and as if made on, the date of this Agreement and as of the
Closing Date.
7.2 Legal Opinion. The
Purchasers shall have received an opinion of Latham &
Watkins LLP, special counsel to the Company, in a customary form
reasonable acceptable to the Purchasers.
7.3 Certificates. Each
Purchaser shall have received:
(a) A certificate signed by the
Company’s Chief Executive Officer and the Chief Financial or
Accounting Officer to the effect that the representations and
warranties of the Company in Section 4 hereof are true and
correct in all material respects (except to the extent that such
representations and warranties are qualified by materiality,
material adverse effect, or words of like effect, in which case
such representations and warranties shall be true in all respects)
as of, and as if made on, the date of this Agreement and as of the
Closing Date and that the Company has satisfied in all material
respects all of the conditions set forth in this
Section 7.
(b) A certificate signed by the
Secretary of the Company to which is attached a true, complete and
correct copy of each of the amended and restated certificate of
incorporation of the Company, the amended and restated bylaws of
the Company and certain resolutions of the Financing Committee of
the Board of Directors of the Company, to the effect that
(i) no document with respect to any amendment to the
certificate of incorporation of the Company has been filed in the
office of the Secretary of State of the State of Delaware since,
and no action has been taken or, to the best knowledge of the
Secretary of the Company, is contemplated by the Board of Directors
or the stockholders of the Company, for the purpose of effecting
any such amendment or the dissolution, merger or consolidation of
the Company, (ii) no proposal for any amendment, repeal or
other modification to the amended and restated bylaws of the
Company has been taken or is currently pending before the Board of
Directors or stockholders of the Company and (iii) the
resolutions of the Financing Committee of the Board of Directors of
the Company authorizing the execution, delivery and performance of
this Agreement and the consummation of the transactions
contemplated by this Agreement have not been altered, amended or
superseded and remain in full force and effect as of the date
hereof.
7.4 Good Standing. The
Company shall be validly existing as a corporation in good standing
under the laws of Delaware as of the Effective Date and the Closing
Date.
7.5 NASDAQ Approval. The
Shares and the Warrant Shares shall have been approved for listing
on the NASDAQ Global Market, subject to official notice of
issuance.
7.6 Material Adverse Effect .
No Company Material Adverse Effect shall have occurred or be
reasonably expected to occur.
7.7 Minimum Commitment .
Purchasers agreeing hereunder to purchase Securities for an
aggregate purchase price of at least $75,000,000 shall have entered
into this Agreement.
SECTION 8. REGISTRATION OF THE
SECURITIES; COMPLIANCE WITH THE SECURITIES ACT.
8.1 Registration Procedures and
Expenses.
(a) Except during a Suspension (as
defined below), the Company will, subject to receipt of necessary
information from the Purchasers:
(i) as soon as practicable, but in
any event no later than 4:00 p.m. Eastern Time on the 30th day
after the Closing Date, to prepare and file with the Commission a
registration statement on Form S-3 or other applicable form
available to the Company (the “ Initial Registration
Statement ”) covering the resale of all of the Shares
and the Warrant Shares of each Purchaser that has complied with
Section 8.5, together with any shares of capital stock issued
or issuable, from time to time, upon any reclassification, share
combination, share subdivision, stock split, share dividend or
similar transaction or event or otherwise as a distribution on, in
exchange for or with respect to any of the foregoing, in each case
held at the relevant time by a Purchaser (the “
Registrable Securities ”); provided,
however , that in the event that the Commission specifically
prohibits the Initial Registration Statement from including all
Registrable Securities of each Purchaser (“ Commission
Guidance ”) ( provided that the Company shall
advocate with the Commission for the registration of all or the
maximum number of the Registrable Securities permitted by
Commission Guidance), then the Company will file such additional
Registration Statements (the “ Subsequent Registration
Statements ,” together with the Initial Registration
Statement, the “ Registration Statements
”) at the earliest practicable date on which the Company is
permitted by Commission Guidance to file such additional
Registration Statements related to the Registrable Securities (the
“ Subsequent Filing Dates ”). If any
Commission Guidance specifically limits the number of Registrable
Securities to be registered on a particular Registration Statement,
the number of Registrable Securities to be registered on such
Registration Statement will first be reduced by the Registrable
Securities represented by Warrant Shares on a pro rata basis based
on the total number of unregistered Warrant Shares held by such
Purchasers on a fully diluted basis, and second by the Registrable
Securities represented by Shares on a pro rata basis based on the
total number of unregistered Shares held by such Purchasers. If the
context so requires, Securities and Warrant Shares of any Purchaser
will not be considered Registrable Securities for the purposes of a
certain determination of Registrable Securities hereunder if, at
that time of such determination, they can be sold pursuant to Rule
144 without volume or manner of sales limitations or have been sold
under an effective Registration Statement.
(ii) cause
(A) the Initial Registration Statement, as may be amended from
time to time, to become effective under the Securities Act as soon
as practicable after the Initial Registration Statement is filed by
the Company, but in any event no later than 4:00 p.m. Eastern Time
on the 90 th day after the Closing Date, or
if the Initial Registration Statement is reviewed by the
Commission, on the 120 th day after and (B) any
Subsequent Registration Statements, as may be amended from time to
time, which may be required to be filed hereunder pursuant to
Section 8.1(a)(i) to become effective under the Securities Act
as soon as practicable but in any event no later than 4:00 p.m.
Eastern Time on the 90 th day after such Subsequent
Filing Date, or if such Subsequent Registration Statement is
reviewed by the Commission, on the 120 th day after such Subsequent
Filing Date (each, its “ Required Effective
Date ”);
(iii) cause any prospectus used in
connection with any Registration Statement (a “
Prospectus ”) to be filed with the Commission
pursuant to Rule 424(b) under the Securities Act as soon as
practicable but in any event no later than 9:00 a.m. Eastern Time
the next day that is not a weekend or holiday and the NASDAQ Global
Market is not closed (“ Trading Day ”)
following the date such Registration Statement is declared
effective by the Commission;
(iv) promptly prepare and file with
the Commission such amendments and supplements to the Registration
Statements and any Prospectus used in connection therewith
(A) as may be necessary to keep such Registration Statements
continuously effective until the earlier of (1) such time as
all Registrable Securities have been sold pursuant to such
Registration Statements, or (2) the date on which all of the
Shares and Warrant Shares may be resold by each of the Purchasers
without registration pursuant to Rule 144 without volume or manner
of sale limitations and (B) as may be reasonably requested by
a Purchaser in order to incorporate information concerning such
Purchaser or such Purchaser’s intended method of
distribution;
(v) so long as any Registration
Statement is effective covering the resale of Registrable
Securities owned by the Purchasers, furnish to each Purchaser with
respect to the Registrable Securities registered under such
Registration Statement (and to each underwriter, if any, of such
Registrable Securities) such reasonable number of copies of
Prospectuses and such other documents as such Purchaser may
reasonably request in order to facilitate the public sale or other
disposition of all or any of the Registrable Securities by such
Purchaser;
(vi) use commercially reasonable
efforts to file documents required of the Company for blue sky
clearance in any states specified in writing by the Purchasers;
provided, however , that the Company shall not be required
to qualify to do business generally in any jurisdiction in which
the Company is not now so qualified;
(vii) bear all expenses in
connection with the procedures in paragraphs (i) through
(vi) of this Section 8.1(a) and the registration of the
Registrable Securities pursuant to the Registration Statements,
other than fees and expenses, if any, of counsel (except as
provided by Section 12.9 below) or other advisers to the
Purchasers or underwriting discounts, brokerage fees and
commissions incurred by the Purchasers, if any, in connection with
an underwritten offering of the Registrable Securities;
(viii) use reasonable best efforts
to prevent the issuance of any stop order or other order suspending
the effectiveness of the Registration Statements and, if such an
order is issued, to obtain the withdrawal thereof at the earliest
possible time and to notify each Purchaser of the issuance of such
order and the resolution thereof;
(ix) furnish to each Purchaser, two
Trading Days after the date that any Registration Statement becomes
effective, a letter, dated such date, of outside counsel
representing the Company addressed to such Purchaser, confirming
the effectiveness of such Registration Statement and, to the
knowledge of such counsel, the absence of any stop
order;
(x) provide to each Purchaser and
its representatives, if requested, the opportunity to conduct a
reasonable inquiry of the Company’s financial and other
records during normal business hours and make available its
officers, directors and employees for questions regarding
information which such Purchaser may reasonably request in order to
fulfill any due diligence obligation on its part; provided
that in the case of this clause (x), the Company shall not be
required to provide, and shall not provide, any Purchaser with
material, non-public information unless such Purchaser agrees to
receive such information and enters into an agreement to keep such
material, nonpublic information confidential and refrain from
trading in any Company security for so long as such information
remains material, nonpublic information; and
(xi) not less than three Trading
Days prior to the filing of a Registration Statement and not less
than two Trading Days prior to the filing of any related Prospectus
or any amendment or supplement thereto (including any document that
would be incorporated or deemed to be incorporated therein by
reference) or, in the case of comments made by the staff of the
Commission and the Company’s responses thereto, within a
reasonable period of time following the receipt thereof by the
Company, furnish to each Purchaser copies of all such documents
proposed to be filed or copies of such correspondence from and to
the Commission relating to such Registration Statement, as the case
may be, which documents (other than those incorporated or deemed to
be incorporated by reference) will be subject to the review of such
Purchasers. The Company shall reflect in each such document when so
filed with the Commission such comments relating to such Purchaser
and its plan of distribution of Registrable Securities as such
Purchaser may reasonably propose; provided, however , that
such comments from such Purchaser must be received by the Company
no later than one Trading Day prior to the filing of such document
with the Commission. Notwithstanding any other provision of this
Agreement, the Company will have no obligation to deliver or make
available to any Purchaser any Registration Statement or Prospectus
containing any material, nonpublic information unless such
Purchaser specifically consents in advance in writing to receive
such material, nonpublic information and such Purchaser has
executed an agreement to keep such material, nonpublic information
confidential and refrain from trading in any Company security for
so long as such information remains material, nonpublic
information.
(b) Except during a Suspension (as
defined below), (i) each document filed or to be filed with
the Commission pursuant to the Exchange Act and incorporated by
reference in any Registration Statement complied or will comply
when so filed in all material respects with the Exchange Act,
(ii) each part of each Registration Statement, when such part
shall become effective, will not contain, and each such part, as
amended or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, (iii) each Registration Statement will
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (iv) each
Registration Statement and Prospectus, as may be amended or
supplemented, will comply in all material respects with the
Securities Act, and (v) each Prospectus, as may be amended or
supplemented, will not, at the time of each sale of the Shares or
the Warrant Shares by the Purchasers, contain any untrue statement
of a material fact or omit to state a material fact necessary to
make the statements
therein, in the light of the
circumstances under which they were made, not misleading, except
that the representations and warranties set forth in this paragraph
will not apply to statements or omissions in any Registration
Statement or Prospectus based upon information relating to any
Purchaser furnished to the Company in writing by such Purchaser
expressly for use therein.
(c) The Company shall be permitted
after the Initial Registration Statement’s Required Effective
Date, to suspend for one or more periods (each such period, a
“ Suspension ”) the actions required
under Sections 8.1(a)(i) through (vi) and the use of a
Prospectus forming a part of a Registration Statement to the extent
that the Board of Directors of the Company concludes in good faith
and based on the advice of counsel that the disclosure of
additional information in the Prospectus is necessary, whether
through an amendment or supplement to such Registration Statement,
the filing of an appropriate report with the Commission pursuant to
the Exchange Act or otherwise. The Company agrees to file such
amendment, supplement or report or otherwise disclose such
additional information as soon as practicable following such notice
of such Suspension. Notwithstanding the foregoing, the Company
agrees that no Suspension shall be for a period of longer than 30
days and no Suspension or Suspensions shall be for an aggregate in
any 365-day period of longer than 60 days.
(d) With a view to making available
to the Purchasers the benefits of Rule 144 (or its successor rule)
and any other rule or regulation of the Commission that may at any
time permit the Purchaser to sell Registrable Securities to the
public without registration, the Company covenants and agrees to:
(A) make and keep public information available, as those terms
are understood and defined in Rule 144, until the earlier of
(1) one year after such date as all of the Purchasers’
Registrable Securities may be resold without volume or manner of
sale limitations pursuant to Rule 144(b) or any other rule of
similar effect or (2) such date as all of the
Purchasers’ Registrable Securities shall have been resold;
(B) file with the Commission in a timely manner all reports
and other documents required of the Company under the Exchange Act;
and (C) furnish to the Purchaser upon request, as long as the
Purchaser owns any Registrable Securities, (1) a written
statement by the Company that it has complied with the reporting
requirements of the Exchange Act, (2) a copy of the
Company’s most recent Annual Report on Form 10-K or Quarterly
Report on Form 10-Q, except to the extent that such documents are
available from the Commission on its EDGAR website, and
(3) such other information as may be reasonably requested in
order to avail the Purchaser of any rule or regulation of the
Commission that permits the selling of any such Registrable
Securities without registration.
8.2 Delay in Effectiveness of
Registration Statement. If a Registration Statement is not
declared effective by the Commission on or prior to its Required
Effective Date, then, in addition to any other rights available to
the Purchasers, on each such Required Effective Date and on each
monthly anniversary of each such Required Effective Date (if the
Registration Statement shall not have been declared effective by
the Commission by such date) until the Registration Statement has
been declared effective by the Commission, the Company shall pay to
each Purchaser, as liquidated damages and not as a penalty, a cash
payment equal to 1.0% of the aggregate purchase price paid by such
Purchaser to the Company with respect to the Shares then held by
such Purchaser that are Registrable Securities. The parties agree
that the Company will not be liable for liquidated damages under
this Section 8.2 in respect
of the Warrants or the Warrant Shares. The
liquidated damages pursuant to the terms hereof shall apply on a
pro rata basis for any portion of a month prior to the Registration
Statement being declared effective by the Commission; provided
that the maximum aggregate liquidated damages payable to a
Purchaser under this Section 8.2 shall not exceed, per
calendar year, 8% of the aggregate purchase price paid by such
Purchaser to the Company with respect to the Shares then held by
such Purchaser that are Registrable Securities. The parties agree
that such liquidated damages shall not be the exclusive damages
under this Agreement with respect to the Registration Statement not
being declared effective by the Commission on or prior to its
Required Effective Date. Notwithstanding the foregoing or anything
to the contrary contained herein, no liquidated or other damages
shall be due to a Purchaser in respect of (A) any limitation
on the number of Shares and the shares of Common Stock underlying
the Warrants that may be registered imposed by the Commission
following the Company’s best efforts not to have such
limitation imposed, or (B) the failure to have any
Registration Statement declared effective on the Required Effective
Date in the event that such failure results from
(i) Commission Guidance that specifically prohibits the use of
such Registration Statement to register the Registrable Securities
(provided that the Company shall advocate with the Commission for
the registration of all or the maximum number of the Registrable
Securities), or (ii) a breach by such Purchaser of its
obligations under this Agreement.
8.3 Maintenance of Effectiveness
of Registration Statement; Listing on Permitted Securities
Exchange. If at any time after a Registration Statement is
declared effective by the Commission, sales cannot be made
thereunder (i) due to the failure of the Company to maintain
the effectiveness of such Registration Statement (other than during
a permissible Suspension), or (ii) because the Common Stock is
not listed or included for quotation on the NASDAQ Global Market,
the New York Stock Exchange or the American Stock Exchange (each, a
“ Permitted Securities Exchange ”), in
each case for a period of longer than 10 days, or for an aggregate
in any 365-day period of longer than 60 days (each such period, a
“ Maintenance Period ” and the final day
of each such period, a “ Maintenance Date
”), then, in addition to any other rights available to the
Purchasers, on each such Maintenance Date and on each successive
Maintenance Date, (A) until the Registration Statement has
been declared effective by the Commission (if the Registration
Statement shall not have been declared effective by the Commission
by such date), or (B) until the Common Stock is listed or
included for quotation on a Permitted Securities Exchange (if the
Common Stock is not listed or included for quotation on a Permitted
Securities Exchange), the Company shall pay to each Purchaser, as
liquidated damages and not as a penalty, a cash payment equal to
1.0% of the aggregate purchase price paid by such Purchaser to the
Company with respect to the Shares then held by such Purchaser that
are Registrable Securities. The parties agree that the Company will
not be liable for liquidated damages under this Section 8.3 in
respect of the Warrants or the Warrant Shares. The liquidated
damages pursuant to the terms hereof shall apply on a pro rata
basis for any portion of a Maintenance Period prior to the
Registration Statement being declared effective by the Commission
or prior to the Common Stock being listed or included for quotation
on a Permitted Securities Exchange, as the case may be;
provided that the maximum aggregate l
