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Exhibit
10.2
CURIS, INC.
COMMON STOCK PURCHASE
AGREEMENT
This COMMON STOCK PURCHASE
AGREEMENT (this “ Agreement ”) is dated as of
August 7, 2007, and is by and among (i) Curis, Inc., a
Delaware corporation, with its principal office at 45 Moulton
Street, Cambridge, Massachusetts (the “ Company
”) and (ii) each person listed on Schedule 1
hereto (each of the persons or entities described in clause (ii),
individually, a “ Purchaser ” and, collectively,
the “ Purchasers ”).
WHEREAS, the Company desires
to issue and sell to the Purchasers, and the Purchasers desire to
purchase from the Company, (i) an aggregate of 1,410,106
shares (the “ Shares ”) of the authorized but
unissued shares of common stock, $0.01 par value per share, of the
Company (the “ Common Stock ”), and
(ii) warrants to purchase an aggregate of 493,537 shares of
Common Stock, for an aggregate purchase price of $1,500,000.25, in
each case all upon the terms and subject to the conditions set
forth in this Agreement;
WHEREAS, the Company and the
Purchasers are executing and delivering this Agreement in reliance
upon the exemption from securities registration afforded by the
provisions of Regulation D (“ Regulation D ”),
as promulgated by the U.S. Securities and Exchange Commission under
the Securities Act of 1933, as amended; and
WHEREAS, simultaneously with
entering in this Agreement, the Company and the Purchasers are
entering into that certain Registration Rights Agreement, dated as
of the date hereof (as amended, the “ Registration Rights
Agreement ”), pursuant to which the Company shall
register for resale the Shares and the Warrant Shares (as defined
below) on the terms set forth therein.
NOW THEREFORE, in
consideration of the mutual agreements, representations, warranties
and covenants herein contained, the parties hereto agree as
follows:
1. Definitions . As
used in this Agreement, the following terms shall have the
following respective meanings:
(a) “ Affiliate
” means any Person that, directly or indirectly, through one
or more intermediaries, controls, is controlled by, or is under
common control with, a Person, as such terms are used and construed
under Rule 144 (as defined below). With respect to a Purchaser, any
investment fund or managed account that is managed on a
discretionary basis by the same investment manager as such
Purchaser will be deemed to be an Affiliate of such
Purchaser.
(b) “ Board
” means the board of directors of the Company.
(c) “ Effective
Date ” means the date on which the registration statement
covering the resale of the Shares and the Warrant Shares is
initially declared effective by the SEC.
(d) “ Exchange
Act ” means the Securities Exchange Act of 1934, as
amended, and all of the rules and regulations promulgated
thereunder.
(e) “ Initial
Securities ” means, the Shares, the Warrants and the
Warrant Shares, as such terms are defined in the Common Stock
Purchase Agreement by and among the Company and the Purchasers
named therein, dated as of August 6, 2007.
(f) “ Majority
Purchasers ” has the meaning set forth in
Section 8.12.
(g) “ Material
Adverse Effect ” has the meaning set forth in
Section 3.1 of this Agreement.
(h) “ Person
” (whether or not capitalized) means an individual, entity,
partnership, limited liability company, corporation, association,
trust, joint venture, unincorporated organization or any other form
of entity not specifically listed herein, and any government,
governmental department or agency or political subdivision
thereof.
(i) “ Regulatory
Authority(ies) ” means any governmental authority in a
country or region that regulates the manufacture or sale of
Company’s products, including, but not limited to, the United
States Food and Drug Administration.
(j) “ Rule 144
” means Rule 144 promulgated under the Securities Act and any
successor or substitute rule, law or provision.
(k) “ SEC
” means the Securities and Exchange Commission.
(l) “ Securities
Act ” means the Securities Act of 1933, as amended, and
all of the rules and regulations promulgated thereunder.
(m) “ Transfer Agent
Instructions ” means irrevocable instructions given in
writing by the Company to the Company’s transfer agent to
issue an original stock certificate to each Purchaser for the
number of Shares purchased by such Purchaser as set forth on
Schedule 1 hereto and registered in the name of such
Purchaser.
(n) “ Transaction
Documents ” means, collectively, this Agreement, the
Registration Rights Agreement, the Warrants and any other documents
or agreements executed in connection with the transactions
contemplated by this Agreement.
(o) “ Warrants
” means the warrants to purchase shares of Common Stock,
dated as of the date hereof, issued by the Company to the
Purchasers, in the form attached hereto as Exhibit A
.
(p) “ Warrant
Shares ” means the shares of Common Stock issued or
issuable upon the exercise of the Warrants.
2. Purchase and Sale;
Closing .
2.1 Purchase and Sale
. Subject to and upon the terms and conditions set forth in this
Agreement, the Company agrees to issue and sell to each Purchaser,
and each Purchaser hereby agrees, severally and not jointly, to
purchase from the Company, at the Closing, units consisting of one
Share and a Warrant to purchase 0.35 shares of Common Stock, with
the aggregate number of Shares and Warrants being purchased under
this Agreement by each Purchaser as set forth opposite such
Purchaser’s name on Schedule 1 hereto. The Shares and
the corresponding Warrants shall be purchased as a unit at a
purchase price per unit equal to $1.06375, allocated as follows:
$1.02 per Share and $0.04375 for each Warrant to purchase 0.35
shares of Common Stock.
2.2 Closing . The
closing of the transactions contemplated under this Agreement (the
“ Closing ”) shall take place as soon as
possible after the satisfaction or waiver of the conditions set
forth in Section 5 below, and in any event on or prior to 5:00
p.m. (Eastern Time) on Wednesday, August 8, 2007,
remotely via exchange of documents and
signatures. At the Closing, (a) the Company shall deliver to
each Purchaser (i) an original stock certificate, registered
in the name of such Purchaser, representing the number of Shares
purchased by such Purchaser, and (ii) an original warrant,
registered in the name of such Purchaser, representing the number
of Warrants purchased by such Purchaser, and (b) each
Purchaser shall deliver to the Company payment of the purchase
price for such Shares and Warrants by wire transfer of immediately
available funds to such account as the Company shall designate in
writing. The date on which the Closing actually occurs is the
“ Closing Date ”.
3. Representations and
Warranties of the Company . The Company hereby represents and
warrants to each Purchaser, as of the date of this Agreement and as
of the Closing Date, and except as otherwise specifically described
in the Company’s SEC Documents (as defined herein), which
qualifies the following representations, warranties and covenants
in their entirety, or as set forth on the specific schedule
furnished by the Company to each Purchaser (collectively, the
“ Disclosure Schedule ”) attached hereto as
Exhibit B , as follows:
3.1 Incorporation .
The Company and each of the Subsidiaries (as defined in
Section 3.17 below) is a corporation or other entity duly
organized, validly existing and in good standing under the laws of
the State of Delaware (or such other applicable jurisdiction of
incorporation or formation), and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the
nature of the business conducted or the character of the property
owned by it makes such qualification necessary, except where the
failure to be so qualified or in good standing, as the case may be,
would not result in a material adverse effect on the assets,
liabilities (contingent or otherwise), business, affairs,
operations, prospects or condition (financial or otherwise) of the
Company (“ Material Adverse Effect ”). The
Company and each of the Subsidiaries have all requisite corporate
power and authority to carry on its business as now conducted and
to carry out the transactions contemplated hereby and in the
Transaction Documents. Neither the Company nor any of the
Subsidiaries is in violation of any of the provisions of its
certificate of incorporation (or other similar corporate formation
or organization document) or by-laws (or other similar corporate
governance document).
3.2 Capitalization .
The authorized capital stock of the Company consists of
(i) 125,000,000 shares of Common Stock, of which 49,533,950
shares are outstanding as of the date of this Agreement,
(ii) 5,000,000 shares of preferred stock, of which there are
zero (0) shares outstanding as of the date of this Agreement,
and (iii) 16,155,132 shares of capital stock are issuable and
reserved for issuance pursuant to option plans or securities (other
than outstanding shares of Common Stock) exercisable for, or
convertible into or exchangeable for any shares of capital stock of
the Company comprised of (a) stock options to purchase
10,495,334 shares of the Company’s common stock under
existing approved stock plans, (b) 4,028,822 shares reserved
for future issuance under existing approved stock plans, and
(c) warrants to purchase 1,630,976 shares of the
Company’s common stock under outstanding warrant agreements.
All shares of the Company’s issued and outstanding capital
stock have been duly authorized, are validly issued and
outstanding, and are fully paid and non-assessable and were issued
in full compliance with applicable state and federal securities
laws and rights of third parties. Except as set forth on
Schedule 3.2 to the Disclosure Schedule, there are no
existing options, warrants, calls, preemptive (or similar) rights,
subscriptions or other rights, agreements, arrangements or
commitments of any character obligating the Company to issue,
transfer or sell, or cause to be issued, transferred or sold, any
shares of the capital stock of the Company or other equity
interests in the Company or any securities convertible into or
exchangeable for such shares of capital stock or other equity
interests, excluding the Shares, the Warrants and the Warrant
Shares to be issued to the Purchasers as contemplated by this
Agreement, and there are no outstanding contractual obligations of
the Company to repurchase, redeem or otherwise acquire any shares
of its capital stock or other securities or equity interests. The
issue and sale of the Shares, the Warrants and the Warrant Shares
will not obligate the Company to issue or sell, pursuant to any
pre-emptive right or otherwise, shares of Common Stock
or
other securities to any Person (other
than the Purchasers) and will not result in a right of any holder
of Company securities to adjust the exercise, conversion, exchange
or reset price under any outstanding shares of capital stock or
other securities. The issuance and sale of the Shares, the Warrants
(and the Warrant Shares pursuant to the Warrants) will not result
in the adjustment of the exercise, conversion, exchange or reset
price of any outstanding security.
3.3 Registration
Rights . Except as set forth on Schedule 3.3 to the
Disclosure Schedule, the Company has not granted or agreed to grant
to any Person any right (including “piggy-back” and
demand registration rights) to have any shares of capital stock or
other securities of the Company registered with the SEC or any
other governmental authority. The Company is eligible to utilize
the registration statement on Form S-3 in connection with
fulfilling its obligations to the Purchasers under the Registration
Rights Agreement and, to the Company’s knowledge, no facts or
circumstances currently exist or are pending or threatened which
could reasonably be expected to prevent the Company from remaining
eligible to use Form S-3 to register the Shares and Warrant Shares
pursuant to said Registration Rights Agreement.
3.4 Authorization .
All corporate action on the part of the Company, its officers,
directors and shareholders, necessary for the authorization,
execution, delivery and performance of this Agreement and the
Transaction Documents and the consummation of the transactions
contemplated herein and therein has been taken. When executed and
delivered by the Company, each of this Agreement and the
Transaction Documents shall constitute a legal, valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as such may be limited by
bankruptcy, insolvency, reorganization or other laws affecting
creditors’ rights generally and by general equitable
principles. The Company has all requisite corporate power and
authority to enter into this Agreement and the Transaction
Documents and to carry out and perform its obligations under their
respective terms.
3.5 Valid Issuance of the
Shares . The Shares, the Warrants and the Warrant Shares have
been duly authorized, and the Shares and the Warrant Shares, upon
issuance pursuant to the terms hereof and the terms of the
Warrants, respectively, will be validly issued, fully paid and
nonassessable and not subject to any encumbrances and restrictions
except for restrictions on transfer set forth in the Transaction
Documents or imposed by applicable securities laws, preemptive
rights or any other similar contractual rights of the stockholders
of the Company or any other Person. The Company has reserved from
its duly authorized capital stock the number of shares of Common
Stock issuable upon the exercise in full of all of the
Warrants.
3.6 Financial
Statements . The Company has prepared and made available to the
Purchasers copies of (i) the audited consolidated balance
sheet of the Company and the Subsidiaries as of the fiscal year
ended December 31, 2006 and the related audited consolidated
income statement, audited consolidated statement of cash flows and
audited consolidated statement of stockholders’ equity of the
Company and the Subsidiaries for the year then ended (the “
Audited Financial Statements ”), and (ii) the
unaudited consolidated balance sheet of the Company and the
Subsidiaries as of June 30, 2007 (the “ Most Recent
Balance Sheet ”), and the related unaudited consolidated
income statement and unaudited consolidated statement of cash flows
of the Company and the Subsidiaries for the same periods then ended
(the financial statements in this clause (ii) are hereinafter
referred to, collectively, as the “ Unaudited Financial
Statements ”). All of the financial statements described
in clauses (i)-(ii) above are hereinafter referred to,
collectively, as the “ Financial Statements ”.
The Financial Statements have been prepared in accordance with
United States generally accepted accounting principles applied on a
consistent basis during the periods covered thereby, subject, in
the case of the Unaudited Financial Statements, to normal year-end
adjustments (which individually and in the aggregate are not
material) and to the absence of footnotes thereto, and present
fairly, in all material respects, the financial position of the
Company and the Subsidiaries and the results of operations as of
the date and for the periods indicated therein.
3.7 SEC Documents .
The Company has prepared and made available to the Purchasers
copies of the following reports of the Company (collectively, the
“ SEC Documents ”): (i) the annual report
on Form 10-K for the year ended December 31, 2006 (the “
Annual Report ”) and (ii) quarterly report on
Form 10-Q for the periods ended June 30, 2007 and
March 31, 2007. As of their respective filing dates, the SEC
Documents complied in all material respects with the requirements
of the Exchange Act, and the rules and regulations promulgated
thereunder, and none of the SEC Documents contain any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which
they were made, not misleading. The financial statements of the
Company included in the SEC Documents comply in all material
respects with applicable accounting requirements and the rules and
regulations of the SEC with respect thereto in effect at the time
of filing. All contracts, agreements, instruments and other
documents to which the Company is a party or to which the property
or assets of the Company are subject are included as part of, or
specifically identified in, the SEC Documents to the extent
required by the rules and regulations of the SEC as in effect at
the time of filing, and each such contract, agreement, instrument
and other document is legal, valid, binding and enforceable against
the Company in accordance with their respective terms, except as
such may be limited by bankruptcy, insolvency, reorganization or
other laws affecting creditors’ rights generally and by
general equitable principles. The Company has prepared and filed
with the SEC all filings and reports required by the Securities Act
and the Exchange Act to make the Company’s filings and
reports current in all respects. Except as set forth in the SEC
Documents, and except for liabilities and obligations incurred
since the date of the Most Recent Balance Sheet in the ordinary
course of business, consistent with past practice: (i) the
Company and its Subsidiaries do not have any material liabilities
or obligations (whether absolute, accrued, contingent or otherwise)
and (ii) there has not been any aspect of the prior or current
conduct of the business of the Company or its Subsidiaries which
may form the basis for any material claim by any third party which
if asserted could result in a Material Adverse Effect.
3.8 Consents . Except
for (a) the filing and effectiveness of any registration
statement required to be filed by the Company under the Securities
Act pursuant to the terms of the Registration Rights Agreement and
(b) any required state “blue sky” law filings in
connection with the transactions contemplated hereunder or under
the Transaction Documents, all material consents, approvals, orders
and authorizations required on the part of the Company in
connection with the execution or delivery of, or the performance of
the obligations under, this Agreement and the Transaction
Documents, and the consummation of the transactions contemplated
herein and therein, have been obtained and will be effective as of
the date hereof. The execution and delivery by the Company of this
Agreement and the Transaction Documents, the consummation of the
transactions contemplated herein and therein, and the issuance of
the Shares, the Warrants and the Warrant Shares, do not require the
consent or approval of any third party or the stockholders of, or
any lender to, the Company or the Trading Market (as defined
below).
3.9 No Conflict;
Compliance With Laws .
(a) The execution, delivery
and performance by the Company of this Agreement and the
Transaction Documents, and the consummation of the transactions
contemplated hereby and thereby, including the issuance of the
Shares, the Warrants and the Warrant Shares, do not and will not
(i) conflict with or violate any provision of the certificate
of incorporation (or other charter documents) or by-laws (or other
similar documents) of the Company or any of the Subsidiaries,
(ii) breach, conflict with or result in any violation of or
default (or an event that with notice or lapse of time or both
would become a default) under, or give rise to a right of
termination, amendment, acceleration or cancellation (with
or
without notice or lapse of time, or
both) of any obligation, contract, commitment, lease, agreement,
mortgage, note, bond, indenture or other instrument or obligation
to which the Company or any of the Subsidiaries is a party or by
which they or any of their properties or assets are bound, except
in each case to the extent such breach, conflict, violation,
default, termination, amendment, acceleration or cancellation does
not, and could not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect, or (iii) result
in a violation of any statute, law, rule, regulation, order,
ordinance or restriction applicable to the Company, the
Subsidiaries or any of their properties or assets, or any judgment,
writ, injunction or decree of any court, judicial or quasi-judicial
tribunal applicable to the Company, the Subsidiaries or any of
their properties or assets.
(b) Neither the Company nor
any of the Subsidiaries (i) is in default under or in
violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a
default by the Company or any of the Subsidiaries), nor has the
Company or any of the Subsidiaries received written notice of a
claim that it is in default under or that it is in violation of,
any indenture, loan or credit agreement or any other agreement or
instrument to which it is a party or by which it or any of its
properties or assets is bound (whether or not such default or
violation has been waived), (ii) is in violation of any
statute, rule or regulation of any governmental authority,
including without limitation all foreign, federal, state and local
laws relating to taxes, environmental protection, occupational
health and safety, food and drugs, product quality and safety,
employment and labor matters, and securities regulation (including
the Securities Act, the Exchange Act and the Federal Food, Drug and
Cosmetic Act, and all rules and regulations promulgated under each
such Act) except in each case as does not reasonably be expected to
have, individually or in the aggregate, a Material Adverse
Effect.
3.10 Brokers or
Finders . Neither the Company nor any of the Subsidiaries has
dealt with any broker or finder in connection with the transactions
contemplated by this Agreement or the Transaction Documents, and
neither the Company nor any of the Subsidiaries has incurred, or
shall incur, directly or indirectly, any liability for any
brokerage or finders’ fees or agents’ commissions or
any similar charges in connection with this Agreement or the
Transaction Documents, or any transaction contemplated hereby or
thereby.
3.11 Trading Market
Listing and Maintenance . The Company’s Common Stock is
currently traded, and thus quoted, on The Nasdaq Global Market
(“ Trading Market ”). Except as set forth on
Schedule 3.11 , since its initial listing, the Company has
complied in all material respects with all of the marketplace rules
and regulations of the Trading Market. The Company has not, in the
twelve (12) months preceding the date hereof, received notice
from any Trading Market on which the Common Stock is or has been
listed or quoted to the effect that the Company is not in
compliance with the listing or maintenance requirements of such
Trading Market. The Company is currently in compliance with all
such listing and maintenance requirements and, to the
Company’s knowledge, there is currently no basis for the
delisting of the Common Stock from the Trading Market.
3.12 Absence of
Litigation . Except as set forth in the SEC Documents, there is
no action, suit, inquiry, notice of violation, proceeding or, to
the knowledge of the Company, investigation pending nor, to the
knowledge of the Company, is any of the above threatened against
the Company, any Subsidiary or any of their respective properties
before or by any court, arbitrator, governmental or administrative
agency or regulatory authority (federal, state, county, local or
foreign) (each an “ Action ”) which
(i) adversely affects or challenges the legality, validity or
enforceability of this Agreement or any of the Transaction
Documents or any of the transactions contemplated hereby or
thereby, including the issuance of the Shares, the Warrants and the
Warrant Shares, or (ii) could reasonably be expected to, if
there were an unfavorable decision, have or result in a Material
Adverse Effect. Neither the Company nor any Subsidiary, nor, to the
knowledge of the Company, any director or officer thereof, is or
has been the subject of any Action involving a claim of violation
of or liability under federal or state securities laws
or
a claim of breach of fiduciary duty
associated with such director or officer’s service to or
association with the Company. To the knowledge of the Company,
there has not been and there is not pending or threatened, any
investigation by the SEC involving the Company or any current or
former director or officer of the Company associated with such
director or officer’s service to or other association with
the Company. The SEC has not issued any stop order or other order
suspending the effectiveness of any registration statement filed by
the Company or any Subsidiary under the Exchange Act or the
Securities Act.
3.13 No Undisclosed
Liabilities; Indebtedness . Since the date of the Most Recent
Balance Sheet, the Company and the Subsidiaries have incurred no
liabilities or obligations, whether known or unknown, asserted or
unasserted, fixed or contingent, accrued or unaccrued, mature or
unmatured, liquidated or unliquidated, or otherwise, except for
liabilities or obligations, that, individually or in the aggregate,
do not or would not have a Material Adverse Effect and other than
liabilities and obligations arising in the ordinary course of
business. Except for indebtedness reflected in the Most Recent
Balance Sheet, the Company has no indebtedness outstanding as of
the date hereof. The Company is not in default with respect to any
outstanding indebtedness or any instrument relating
thereto.
3.14 Title to Assets .
Each of the Company and the Subsidiaries has good and marketable
title to all real and personal property owned by it that is
material to the business of the Company or such Subsidiaries, in
each case free and clear of all liens and encumbrances, except
those, if any, reflected in the Financial Statements or incurred in
the ordinary course of business consistent with past practice. Any
real property and facilities held under lease by the Company or the
Subsidiaries are held by it or them under valid, subsisting and
enforceable leases (subject to laws of general application relating
to bankruptcy, insolvency, reorganization, or other similar laws
affecting creditors’ rights generally and other equitable
remedies) with which the Company and the Subsidiaries are in
compliance in all material respects.
3.15 Labor Relations .
No labor or employment dispute exists or, to the knowledge of the
Company, is imminent or threatened, with respect to any of the
employees of the Company or any of the consultants who serve on any
scientific advisory board or other similar committee of the
Company, that has, or could reasonably be expected to have,
individually or in the aggregate, a Material Adverse
Effect.
3.16 Intellectual
Property . The Company and the Subsidiaries own or have the
right to use all (i) valid and enforceable patents, patent
applications, trademarks, trademark registrations, service marks,
service mark registrations, Internet domain name registrations,
copyrights, copyright registrations, licenses, trade secret rights
and (ii) inventions, software, works of authorship, trade
names, databases, formulae, know how, Internet domain names and
other intellectual property (including trade secrets and other
unpatented and/or unpatentable proprietary confidential
information, systems, or procedures) (collectively, the “
Intellectual Property ”) used in, or necessary to
conduct, their respective businesses as currently conducted and as
proposed to be conducted, and as described in the SEC Documents.
Except as described in the SEC Documents, to the knowledge of the
Company, the Company and the Subsidiaries’ ownership or use
of the Intellectual Property in their respective businesses as
currently conducted and proposed to be conducted do not give rise
to any infringement, misappropriation, or other violation of any
valid and enforceable intellectual property rights of any other
person. Except as set forth on Schedule 3.16 to the
Disclosure Schedule, there have been no written claims or notice
made against the Company or any of the Subsidiaries
(a) asserting the invalidity, abuse, misuse, or
unenforceability of any of the Intellectual Property, and, to the
Company’s knowledge, there are no reasonable grounds for any
such claims, or (b) that they are in conflict with or
infringing upon the asserted rights of others in connection with
the Intellectual Property. Neither the Company nor its Subsidiaries
have made any claim of any violation or infringement by others of
the Company’s or the
Subsidiaries’ rights in or to the
Intellectual Property, and to the best of the Company’s
knowledge, no reasonable grounds for such claims exist. Other than
as set forth in the SEC Documents and on Schedule 3.16 to
the Disclosure Schedule, no material royalties or fees (license or
otherwise) are payable by the Company or any of the Subsidiaries to
any Person by reason of the ownership or use of any of the
Intellectual Property.
3.17 Subsidiaries; Joint
Ventures . Except for the subsidiaries listed on Schedule
3.17 to the Disclosure Schedule (the “
Subsidiaries ”), the Company has no subsidiaries and
does not otherwise own or control, directly or indirectly, any
other Person. Except as described in the SEC Documents, the Company
is not a participant in any joint venture, partnership, or similar
arrangement material to its business.
3.18 Compliance with
Regulatory Requirements .
The Company and the
Subsidiaries possess all certificates, approvals, authorizations
and permits issued by the appropriate federal, state, local or
foreign regulatory authorities, including the Food and Drug
Administration, necessary to conduct their businesses as described
in the SEC Documents, except where the failure to possess such
certificates, approvals, authorizations and permits is not
reasonably expected,, individually or in the aggregate, to result
in a Material Adverse Effect (the “ Governmental
Authorizations ”), and the Company has not received any
written notice of proceedings relating to the revocation or
modification of any Governmental Authorizations except as described
in the SEC Documents. All the Governmental Authorizations have been
duly issued or obtained and are in full force and effect, and the
Company and its Subsidiaries are in material compliance with the
terms of all the Governmental Authorizations. The Company and its
Subsidiaries have not engaged in any activity that, to their
knowledge, would cause revocation or suspension of any such
Governmental Authorizations. Neither the execution, delivery nor
performance of this Agreement or any Transaction Document shall
adversely affect the status of any of the Governmental
Authorizations. The Company represents and warrants that
(a) no Regulatory Authority has initiated any clinical hold or
other regulatory or legal action with respect to any of the
Company’s product candidates or compounds, (b) the
Company and, to its knowledge, any third parties from whom the
Company obtains compounds or its product candidates are in
compliance with applicable good manufacturing practice regulations,
(c) all adverse events that were known to or required to be
reported by the Company to the Regulatory Authorities have been
reported in a timely manner, and (d) all clinical trials or
other studies required to be performed for product candidates of
the Company are ongoing in material compliance with the applicable
Regulatory Authority requirements.
3.19 Taxes . The
Company and each of the Subsidiaries has filed (or has had filed on
its behalf), will timely file or will cause to be timely filed, or
has timely filed for an extension of the time to file, all material
Tax Returns (as defined below) required by applicable law to be
filed by it or them prior to or as of the date hereof, and such Tax
Returns are, or will be at the time of filing, true, correct and
complete in all material respects. Each of the Company and the
Subsidiaries has paid (or has had paid on its behalf) or, where
payment is not yet due, has established (or has had established on
its behalf and for its sole benefit and recourse) or will establish
or cause to be established in accordance with United States
generally accepted accounting principles on or before the date of
hereof an adequate accrual for the payment of, all material Taxes
(as defined below) due with respect to any period ending prior to
or as of the date hereof. “ Taxes ” shall mean
any and all taxes, charges, fees, levies or other assessments,
including income, gross receipts, excise, real or personal
property, sales, withholding, social security, retirement,
unemployment, occupation, use, goods and services, license, value
added, capital, net worth, payroll, profits, franchise, transfer
and recording taxes, fees and charges, and any other taxes,
assessment or similar charges imposed by the Internal Revenue
Service or any taxing authority (whether state, county, local or
foreign) (each, a “ Taxing Authority ”),
including any interest, fines, penalties or additional
amounts attributable to or imposed upon
any such taxes or other assessments. “ Tax Return
” shall mean any report, return, document, declaration or
other information or filing required to be supplied to any Taxing
Authority, including information returns, any documents with
respect to accompanying payments of estimated Taxes, or with
respect to or accompanying requests for extensions of time in which
to file any such return, report, document, declaration or other
information. There are no claims or assessments pending against the
Company or any of the Subsidiaries for any material alleged
deficiency in any Tax, and neither the Company nor any of the
Subsidiaries has been notified in writing of any material proposed
Tax claims or assessments against the Company or any of the
Subsidiaries. No Tax Return of the Company or any of the
Subsidiaries is or has been the subject of an examination by a
Taxing Authority. Each of the Company and the Subsidiaries has
withheld from each payment made to any of its past or present
employees, officers and directors, and any other person, the amount
of all material Taxes and other deductions required to be withheld
therefrom and paid the same to the proper Taxing Authority within
the time required by law.
3.20 Pensions and
Benefits .
(a) Schedule 3.20(a)
to the Disclosure Schedule contains a true and complete list of
each “employee benefit plan” within the meaning of
Section 3(3) of the United States Employee Retirement Income
Security Act of 1974, as amended (“ ERISA ”),
including, without limitation, multiemployer plans within the
meaning of Section 3(37) of ERISA, and all retirement, profit
sharing, stock option, stock bonus, stock purchase, severance,
fringe benefit, deferred compensation, and other employee benefit
programs, plans, or arrangements, whether or not subject to ERISA,
under which (i) any current or former directors, officers,
employees or consultants of the Company has any present or future
right to benefits and which are contributed to, sponsored by or
maintained by the Company or any of the Subsidiaries, or
(ii) the Company or any of the Subsidiaries has any present or
future liability. All such programs, plans, or arrangements shall
be collectively referred to as the “Company Plans.”
Each Company Plan is included as part of or specifically identified
in the SEC Documents to the extent required by the rules and
regulations of the SEC as in effect at the time of
filing.
(b) (i) Each Company
Plan has been established and administered in all material respects
in accordance with its terms and in compliance with the applicable
provisions of ERISA, the Internal Revenue Code of 1986, as amended
(the “ Code ”), and other applicable laws, rules
and regulations; (ii) each Company Plan which is intended to
be qualified within the meaning of Section 401(a) of the Code
is so qualified and has received a favorable determination letter
as to its qualification (or if maintained pursuant to a prototype
form of instrument the sponsor thereof has received a favorable
opinion letter as to its qualification), and to the Company’s
knowledge nothing has occurred, whether by action or failure to
act, that could reasonably be expected to cause the loss of such
qualification; and (iii) no Company Plan provides retiree
health or life insurance benefits (whether or not insured), and
neither the Company nor the Subsidiaries have any obligations to
provide any such retiree benefits other than as required pursuant
to Section 4980B of the Code or other applicable
law.
(c) No Company Plan is a
“multiemployer plan” as defined in
Section 4001(a)(3) of ERISA) or a plan subject to the minimum
funding requirements of Section 302 or ERISA or
Section 412 of the Code or Title IV of ERISA, and neither the
Company, the Subsidiaries, nor any member of th
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