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EXHIBIT 10.37
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CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
Between
ONCORMED, INC.,
SOUTHBROOK INTERNATIONAL INVESTMENTS,
LTD.,
▇▇▇▇▇▇▇▇ INVESTMENTS L.P.,
MONTROSE INVESTMENTS, LTD.,
▇▇▇▇▇ ▇▇▇▇▇▇▇ STRATEGIC GROWTH FUND, L.P.
and
▇▇▇▇▇ ▇▇▇▇▇▇▇ STRATEGIC GROWTH FUND, LTD.
Dated as of February 27, 1998
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CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT (this "Agreement"),
dated as of February 27, 1998, between Oncormed, Inc., a Delaware corporation
(the "Company") and Southbrook International Investments, Ltd., a corporation
organized and existing under the laws of the British Virgin Islands
("Southbrook"), ▇▇▇▇▇▇▇▇ Investments L.P., a Delaware limited partnership
("▇▇▇▇▇▇▇▇"), Montrose Investments, Ltd., a Cayman Islands exempt company
("Montrose"), ▇▇▇▇▇ ▇▇▇▇▇▇▇ Strategic Growth Fund, L.P., a New York limited
partnership ("▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇"), and ▇▇▇▇▇ ▇▇▇▇▇▇▇ Strategic Growth Fund,
Ltd., a Cayman Islands exempt company ("▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited"). Southbrook,
Westover, Montrose, ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited are each
referred to herein as a "Purchaser" and are collectively referred to herein as
the "Purchasers."
WHEREAS, subject to the terms and conditions set forth in this
Agreement, the Company desires to issue and sell to the Purchasers, and the
Purchasers desire to acquire from the Company, shares of the Company's 6%
Series A Convertible Preferred Stock, par value $.01 per share (the "Series A
Preferred"), and the Company's 6% Series B Convertible Preferred Stock, par
value $.01 per share (the "Series B Preferred" and together with the Series A
Preferred, the "Preferred Stock").
IN CONSIDERATION of the mutual covenants contained in this Agreement,
the Company and each Purchaser agree as follows:
ARTICLE I
PURCHASE AND SALE OF PREFERRED SHARES
1.1 Purchase and Sale. (a) Subject to the terms and conditions
set forth herein, the Company shall issue and sell to the Purchasers, and the
Purchasers, severally and not jointly, shall purchase from the Company: (i) an
aggregate of 300 shares, or 333 shares if the Incyte Series A Closing (as
defined below) occurs, of Series A Preferred (the "Series A Shares"); and (ii)
an aggregate of 300 shares, or 333 shares if the Incyte Series A Closing (as
defined below) occurs, of Series B Preferred (the "Series B Shares" and
together with the Series A Shares, the "Shares").
(b) The Series A Preferred shall have the respective
rights, preferences and privileges set forth in Exhibit A attached hereto (the
"Series A Terms"), which shall be incorporated into a Certificate of
Designation to be approved by the Purchasers and filed on or prior to the
Series A Closing (as defined below) by the Company with the Secretary of State
of Delaware (the "Series A Designation"). The Series B Preferred shall have
respective rights, preferences and privileges identical to the Series A Terms,
mutatis mutandis, and shall rank pari passu with the Series A Preferred with
regard to dividends, liquidation, voting rights and any other preferential
rights designated therein, except that (i) the Conversion Price (as defined
below) for conversion of the Series B Shares shall be determined as of the
Original Issue Date (as defined below) for such Series B Shares and (ii) in the
"Applicable Percentage" definition
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the date "March 31, 1998" shall be replaced with the date which is the last day
of the month in which the Series B Closing Date occurs.
The Series B Preferred shall be authorized pursuant to a Certificate
of Designation prepared by the Company, subject to the approval of the
Purchasers, and filed at or prior to the Series B Closing Date (as defined
below), by the Company with the Secretary of State of Delaware (such
certificate of designation and the Series A Designation are referred to as the
"Certificates of Designation").
For purposes of this Agreement, "Conversion Price," "Original Issue
Date," "Conversion Date" "Trading Day" and "Per Share Market Value" shall have
the meanings set forth in Exhibit A; and "Market Price" as at any date shall
mean the average Per Share Market Value for the five (5) Trading Days
immediately preceding such date.
1.2 Purchase Price. The purchase price per Share shall be
$10,000.
1.3 The Closings.
(a) The Series A Closing. (i) The closing of the
purchase and sale of the Series A Shares (the "Series A Closing") shall take
place at the offices of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
("▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇"), ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
immediately following the execution hereof or such later date as the parties
shall agree, but not prior to the date that the conditions set forth in Section
4.1 have been satisfied or waived by the appropriate party. The date of the
Series A Closing is hereinafter referred to as the "Series A Closing Date." At
the Series A Closing, the Company shall sell and issue to the Purchasers, and
the Purchasers shall, severally and not jointly, purchase from the Company, an
aggregate of 300 Series A Shares for an aggregate purchase price of $3,000,000
(the "Series A Purchase Price").
(ii) At the Series A Closing, (a) the Company
shall deliver to each Purchaser (1) one or more stock certificates representing
the Series A Shares purchased by such Purchaser as set forth next to such
Purchaser's name on Schedule 1 attached hereto, each registered in the name of
such Purchaser, (2) Warrants in the form of Exhibit B (the "Series A Warrants")
to purchase an aggregate of 150,000 shares of the Company's common stock, $.01
par value (the "Common Stock"), at an exercise price equal to 122% of the
closing price of the Common Stock on the Trading Day immediately prior to the
Series A Closing Date, exercisable for three years from the Original Issue
Date, each registered in the names of such Purchaser and in the amounts set
forth in Schedule 1, (3) the legal opinion referenced in Section 4.1(b)(vi),
substantially in the form attached hereto as Exhibit D, and (4) all other
documents, instruments and writings required to have been delivered at or prior
to the Series A Closing by the Company pursuant to this Agreement and the
Registration Rights Agreement, dated the date hereof, by and between the
Company and the Purchasers, in the form of Exhibit C (the "Registration Rights
Agreement"), and (b) each Purchaser shall deliver to the Company (1) its
portion of the Series A Purchase Price set forth next to its name on Schedule
1, in United States dollars in immediately available funds by wire transfer to
an account designated in writing by the Company
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for such purpose prior to the Series A Closing Date, and (2) all documents,
instruments and writings required to have been delivered at or prior to the
Series A Closing by such Purchaser pursuant to this Agreement and the
Registration Rights Agreement.
(iii) If Incyte Pharmaceuticals, Inc, ("Incyte")
exercises its right by March 6, 1998 to purchase shares of Series A Preferred
Stock and Warrants, then the Company shall sell to Incyte and Incyte shall
purchase from the Company (the "Incyte Series A Sale") 33 shares of Series A
Preferred Stock and warrants to purchase 16,666 shares of Common Stock for an
aggregate amount of $330,000 and upon such sale Incyte shall execute a
signature page to each of this Agreement and the Registration Rights Agreement
and shall thereby become a Purchaser under this Agreement and a Holder under
the Registration Rights Agreement, subject to all of the terms, conditions,
rights and obligations of a Purchaser hereunder and a Holder thereunder. Upon
consummation of the Incyte Series A Sale the term "Purchaser" under this
Agreement shall include Incyte and the term "Series A Warrants" shall include
the warrants sold to Incyte in the Incyte Series A Sale. The Company shall
notify the Purchasers in writing within two Trading Days following the Incyte
Series A Sale and shall distribute Incyte signature pages together with such
notice.
(b) The Series B Closing. (i) Subject to the terms and
conditions set forth in this Agreement, the Purchasers shall have the right to
deliver to the Company and the Company shall have the right to deliver to the
Purchasers a written notice (a "Series B Subsequent Financing Notice")
requiring either the Company to sell or the Purchasers to buy, as the case may
be, 300 Series B Shares, for an aggregate purchase price of $3,000,000, if
Incyte has not become a Purchaser (or 333 Series B Shares, for an aggregate
purchase price of $3,330,000, if Incyte has become a Purchaser) (the "Series B
Purchase Price") at a per share purchase price of $10,000. The Purchasers may
deliver to the Company or the Company may deliver to the Purchasers a Series B
Subsequent Financing Notice no earlier than 90 days after the effective date of
the Underlying Shares Registration Statement (as defined in the Registration
Rights Agreement) relating to the securities issued at the Series A Closing
Date and no later than 150 days after such effective date. At the Series B
Closing each Purchaser shall be obligated (subject to the terms and conditions
herein) to purchase such portion of such Series B Shares as equals such
Purchaser's pro-rata portion of the purchase price for the Series A Shares
issued and sold at the Series A Closing. The closing of the purchase and sale
of the Series B Shares (the "Series B Closing") shall take place at the offices
of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ on such date indicated in the Series B Subsequent
Financing Notice (which may not be prior to the 15th Trading Day or subsequent
to the 30th Trading Day after receipt by either party of the Subsequent
Financing Notice, or as otherwise agreed to by the parties); provided that in
no case shall the Series B Closing take place unless and until the conditions
listed in Section 4.2 have been satisfied or waived by the appropriate party.
The date of the Series B Closing is hereinafter referred to as the "Series B
Closing Date."
(ii) At the Series B Closing, (a) the Company shall
deliver to each Purchaser (1) a pro rata portion of the Series B Shares
(determined by reference to the amount of Series A Shares issued and sold at
the Series A Closing and, if Incyte has become a Purchaser under this
Agreement, the Incyte Series A Closing, provided that ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ and
▇▇▇▇▇
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▇▇▇▇▇▇▇ Limited shall collectively, in their sole discretion, have the option
to purchase up to $1,000,000 of the Series B Shares) to be issued and sold
thereat (or such other amount upon which the parties may agree), registered in
the name of the appropriate Purchaser, (2) Warrants in the form of Exhibit B
(the "Series B Warrants" and together with the Series A Warrants, the
"Warrants") to purchase a pro rata portion of an aggregate of 100,000 shares of
the Common Stock (determined by reference to the percentage of Series B Shares
purchased by each Purchaser) at an exercise price equal to 122% of the closing
price of the Common Stock on the Trading Day immediately prior to the Series B
Closing Date, exercisable for three years from the Original Issue Date, each
registered in the names of such Purchaser, (3) the legal opinion referenced in
Section 4.2(xii), substantially in the form attached hereto as Exhibit D, and
(4) all other documents, instruments and writings required to have been
delivered at or prior to the Series B Closing by the Company to the Purchasers
pursuant to this Agreement; and (b) each Purchaser shall deliver to the Company
(1) its portion of the Series B Purchase Price in United States dollars in
immediately available funds by wire transfer to an account designated in
writing by the Company for such purpose on or prior to the Series B Closing
Date and (2) all documents, instruments and writings required to have been
delivered at or prior to the Series B Closing by such Purchaser pursuant to
this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 Representations, Warranties and Agreements of the Company.
The Company hereby makes the following representations and warranties to the
Purchasers:
(a) Organization and Qualification. The Company is a
corporation, duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, with the requisite corporate power and authority
to own and use its properties and assets and to carry on its business as
currently conducted. The Company has no subsidiaries other than as set forth
in Schedule 2.1(a) (collectively the "Subsidiaries"). Each of the Subsidiaries
is a corporation, duly incorporated, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or organization (as
applicable), with the requisite corporate power and authority to own and use
its properties and assets and to carry on its business as currently conducted.
Each of the Company and the Subsidiaries is duly qualified to do business and
is in good standing as a foreign corporation in each jurisdiction in which the
nature of the business conducted or 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, individually or in the aggregate, (x)
adversely affect the legality, validity or enforceability of the Preferred
Stock or any of the Transaction Documents (as defined below) in any material
respect, (y) have or result in a material adverse effect on the results of
operations, assets, prospects, or financial condition of the Company and the
Subsidiaries, taken as a whole or (z) adversely affect the Company's ability to
perform fully on a timely basis its obligations under any Transaction Document
in any material respect (any of (x), (y) or (z), being a "Material Adverse
Effect").
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(b) Authorization; Enforcement. The Company has the
requisite corporate power and authority to enter into and to consummate the
transactions contemplated by this Agreement and the other Transaction
Documents, and otherwise to perform its obligations hereunder and thereunder.
This Agreement, the Certificates of Designation, the Warrants and the
Registration Rights Agreement are collectively referred to as the "Transaction
Documents". The execution and delivery of each of the Transaction Documents by
the Company and the consummation by it of the transactions contemplated hereby
and thereby have been duly authorized by all necessary action on the part of
the Company and no further action is required by the Company. With respect to
the Series A Closing, each of the Transaction Documents to be executed by the
Company on or prior to the Series A Closing Date has been duly executed by the
Company and when delivered in accordance with the terms hereof will constitute
the valid and binding obligation of the Company enforceable against the Company
in accordance with its terms and, with respect to the Series B Closing, each of
the Transaction Documents to be executed by the Company on or prior to the
Series B Closing Date has been duly executed by the Company and when delivered
in accordance with the terms hereof will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with
its terms, in each case, except as rights to indemnification or contribution
may be limited by applicable laws, equitable principles or public policy and
except as enforceability thereof may be limited by applicable bankruptcy,
reorganization, moratorium, liquidation or other similar laws relating to or
affecting creditors' rights generally or by general equitable principles.
Neither the Company nor any Subsidiary is in violation of any of the provisions
of its respective certificate of incorporation, articles, by-laws or other
charter documents. Prior to each of the Series A Closing Date and the Series B
Closing Date, the respective Certificate of Designation has been or will have
been filed with the Secretary of State of the State of Delaware and will be in
full force and effect.
(c) Capitalization. The authorized, issued and
outstanding capital stock of the Company is set forth in Schedule 2.1(c).
Except as set forth in Schedule 2.1(c), no shares of Common Stock are entitled
to preemptive or similar rights, nor is any holder of the Common Stock entitled
to preemptive or similar rights arising out of any agreement or understanding
with the Company by virtue of any of the Transaction Documents. Except as
disclosed in Schedule 2.1(c), there are no outstanding options, warrants,
script rights to subscribe to, calls or commitments of any character whatsoever
relating to, or, except as a result of the purchase and sale of the Shares and
Warrants, securities, rights or obligations convertible into or exchangeable
for, or giving any person any right to subscribe for or acquire any shares of
Common Stock, or contracts, commitments, understandings, or arrangements by
which the Company or any Subsidiary is or may become bound to issue additional
shares of Common Stock, or securities or rights convertible or exchangeable
into shares of Common Stock. To the knowledge of the Company, except as
specifically disclosed in the SEC Documents (as defined below) or Schedule
2.1(c), no Person or group of related Persons beneficially owns (as determined
pursuant to Rule 13d-3 promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) or has the right to acquire by agreement with
or by obligation binding upon the Company beneficial ownership of in excess of
5% of the Common Stock. A "Person" means an individual or corporation,
partnership, trust, incorporated or unincorporated association, joint
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venture, limited liability company, joint stock company, government (or an
agency or subdivision thereof) or other entity of any kind.
(d) Issuance of Shares and Warrants. The Shares and the
Warrants are duly authorized, and when issued and paid for in accordance with
the terms hereof, or the Warrants, as the case may be, shall be validly issued,
fully paid and nonassessable, free and clear of all liens, encumbrances and
rights of first refusal of any kind (collectively, "Liens"). The Company, as
at the Series A Closing Date and the Series B Closing Date (each a "Closing
Date"), as the case may be, will have and at all times while the Shares and any
Warrants are outstanding will maintain an adequate reserve of duly authorized
shares of Common Stock to enable it to perform its obligations under this
Agreement, the Warrants and the Certificates of Designation with respect to the
number of Shares and Warrants issued and outstanding at such Closing Date and
in no circumstances shall such reserved and available shares of Common Stock be
less than the sum of (i) 200 % of the maximum number of shares of Common Stock
which would be issuable upon conversion of the Shares issued pursuant to the
terms hereof with respect to the number of Shares issued and outstanding at
such Closing Date were such conversion effected on the Original Issue Date for
such Shares, (ii) the number of shares of Common Stock issuable upon exercise
of the Warrants and (iii) the number of shares Common Stock which would be
issuable upon payment of dividends on the Shares, assuming each Share is
outstanding for two years. The shares of Common Stock issuable upon conversion
of the Shares or exercise of the Warrants and which may be issued as payment of
dividends on the Shares are collectively referred to herein as the "Underlying
Shares." When issued in accordance with the Certificates of Designation, and
upon exercise of the Warrants, the Underlying Shares will be duly authorized,
validly issued, fully paid and nonassessable, free and clear of all Liens.
(e) No Conflicts. The execution, delivery and
performance of this Agreement and the other Transaction Documents by the
Company 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 its certificate of incorporation, bylaws or other charter
documents (each as amended through the date hereof) or (ii) subject to
obtaining the consents referred to in Section 2.1(f), conflict with, or
constitute a default (or an event which 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 of, any agreement, indenture or
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, assuming the accuracy of Sections
2.2(b) through (f) of this Agreement, Federal and state securities laws and
regulations), or by which any material property or asset of the Company is
bound or affected, except in the case of each of clauses (ii) and (iii), such
conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have or result in a
Material Adverse Effect. The business of the Company is not being conducted in
violation of any law, ordinance or regulation of any governmental authority,
except for violations which, individually or in the aggregate, would not have a
Material Adverse Effect.
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(f) Consents and Approvals. Except as specifically set
forth in Schedule 2.1(f), neither the Company nor any Subsidiary is required to
obtain any consent, waiver, authorization or order of, give any notice to, or
make any filing or registration with, any court or other federal, state, local
or other governmental authority or other person in connection with the
execution, delivery and performance by the Company of the Transaction
Documents, other than (i) the filings of the Certificates of Designation with
respect to the Preferred Stock with the Secretary of State of Delaware, which
filings with respect to the Series A Shares shall be effected prior to the
Series A Closing Date and with respect to the Series B Shares shall be effected
prior to the Series B Closing Date, (ii) the filing of Underlying Shares
Registration Statements with the Securities and Exchange Commission (the
"Commission"), which shall be filed in accordance with and in the time periods
set forth in the Registration Rights Agreement, (iii) the application(s) or any
letter(s) acceptable to the American Stock Exchange (the "AMEX") for the
listing of the Underlying Shares with the AMEX (and with any other national
securities exchange or quotation system on which the Common Stock is then
listed), (iv) any filings, notices or registrations under applicable Federal
and state securities laws, and (v) other than, in all other cases, where the
failure to obtain such consent, waiver, authorization or order, or to give such
notice or make such filing or registration would not have or result in,
individually or in the aggregate, a Material Adverse Effect (together with the
consents, waivers, authorizations, orders, notices and filings referred to in
Schedule 2.1(f), the "Required Approvals").
(g) Litigation; Proceedings. Except as specifically
disclosed in Schedule 2.1(g) or the Disclosure Materials (as hereinafter
defined) there is no action, suit, notice of violation, proceeding or
investigation pending or, to the knowledge of the Company, threatened against
or affecting the Company or any of its Subsidiaries or any of their respective
properties before or by any court, governmental or administrative agency or
regulatory authority (federal, state, county, local or foreign) which, if
determined adversely to the Company, (i) could reasonably be expected to
adversely affect or challenge the legality, validity or enforceability of any
of the Transaction Documents or the Preferred Stock or (ii) could reasonably be
expected to, individually or in the aggregate, have a Material Adverse Effect.
(h) No Default or Violation. Neither the Company nor any
Subsidiary (i) is in default under or in violation of any indenture, loan or
credit agreement or any other agreement or instrument to which it is a party or
by which it or any of its properties is bound, (ii) is in violation of any
order of any court, arbitrator or governmental body applicable to it, or (iii)
is in violation of any statute, rule or regulation of any governmental
authority to which it is subject, except as could not reasonably be expected
to, in any such case (individually or in the aggregate), have or result in a
Material Adverse Effect.
(i) Schedules. On the Series A Closing Date, the
Schedules to this Agreement furnished by or on behalf of the Company with
respect to the Series A Closing do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. The Company shall have the right to update the Schedules
to this Agreement in connection with the Series B Closing so that on the Series
B Closing Date the Schedules to this Agreement do not contain any untrue
statement of a material fact or omit to state any
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material fact necessary in order to make the statements made therein, in light
of the circumstances under which they were made, not misleading.
(j) Private Offering. Neither the Company, any Person
controlled by the Company, nor, to the Company's knowledge, any Person acting
on its behalf has taken or will take any action which might subject the
offering, issuance or sale of the Securities to the registration requirements
of the Securities Act of 1933, as amended (the "Securities Act").
(k) SEC Documents; Financial Statements; No Adverse
Change. The Company has filed all reports required to be filed by it under the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
three years preceding the date hereof (or such shorter period as the Company
was required by law to file such material) (the foregoing materials being
collectively referred to herein as the "SEC Documents" and, together with the
Schedules to this Agreement, the "Disclosure Materials") on a timely basis or
has received a valid extension of such time of filing and has filed any such
SEC Documents prior to the expiration of any such extension. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the Securities Act and the Exchange Act and the rules and
regulations of the Commission promulgated thereunder, and none of the SEC
Documents, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. All material agreements to which the Company
is a party or to which the property or assets of the Company are subject have
been filed as exhibits to the SEC Documents as required. 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 Commission with respect thereto as in effect at the time of filing.
Such financial statements have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis during the periods
involved, except as may be otherwise specified in such financial statements or
the notes thereto, and fairly present in all material respects the financial
position of the Company as of and for the dates thereof and the results of
operations and cash flows for the periods then ended, subject, in the case of
unaudited statements, to normal year-end audit adjustments. Since the date of
the financial statements included in the Company's last filed Quarterly Report
on Form 10-Q for the period ended September 30, 1997, there has been no event,
occurrence or development that has had a Material Adverse Effect which has not
been specifically disclosed to the Purchasers by the Company. The Company last
filed audited financial statements with the Commission on March 30, 1997, and
has not received any comments from the Commission in respect thereof.
(l) Seniority. No class of equity securities of the
Company is senior to the Preferred Stock in right of payment, whether upon
liquidation, dissolution or otherwise.
(m) Investment Company. The Company is not, and is not
controlled by or under common control with an affiliate of, an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.
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(n) Certain Fees. Except for certain fees payable to
▇▇▇▇▇ ▇▇▇▇▇▇▇ Asset Management, LLC pursuant to Section 3 of the letter
agreement dated February 12, 1998 between the Company and ▇▇▇▇▇ ▇▇▇▇▇▇▇ Asset
Management, LLC (the "Engagement Letter"), and fees payable to the Company to
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC pursuant to that certain engagement letter dated February
12, 1998, no fees or commissions will be payable by the Company to any broker,
financial advisor, finder, investment banker, or bank with respect to the
transactions contemplated by this Agreement. The Purchasers shall have no
obligation with respect to any fees or with respect to any claims made by or on
behalf of other Persons for fees of a type contemplated in this Section that
may be due in connection with the transactions contemplated by this Agreement.
The Company shall indemnify and hold harmless each of the Purchasers, its
employees, officers, directors, agents, and partners, and their respective
Affiliates (as such term is defined under Rule 405 promulgated under the
Securities Act), from and against all claims, losses, damages, costs (including
the costs of preparation and attorney's fees) and expenses suffered in respect
of any such claimed or existing fees.
(o) Solicitation Materials. The Company has not (i)
distributed any offering materials in connection with the offering and sale of
the Shares, the Warrants or the Underlying Shares other than the Disclosure
Materials and materials provided pursuant to Section 2.2(f) hereof and, in each
case, any amendments and supplements thereto or (ii) solicited any offer to buy
or sell the Shares, the Warrants or the Underlying Shares by means of any form
of general solicitation or advertising. None of the Disclosure Materials or
any other information provided to the Purchasers by or on behalf of the Company
contain any untrue statement of material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading.
(p) Form S-3 Eligibility. The Company is, and at each
Closing Date will be, eligible to register securities for resale with the
Commission under Form S-3 promulgated under the Securities Act.
(q) Exclusivity. The Company shall not issue and sell
the Preferred Stock to any Person other than the Purchasers pursuant to this
Agreement other than with the specific prior written consent of each of the
Purchasers.
(r) Listing and Maintenance Requirements Compliance. The
Company has not in the two years preceding the date hereof received notice
(written or oral) from the AMEX (or any other stock exchange, market or trading
facility on which the Common Stock is or has been listed (or on which it has
been quoted) to the effect that the Company is not in compliance with the
listing or maintenance requirements of such exchange or market.
(s) Patents and Trademarks. Except as set forth in
Schedule 2.1(s), the Company has, or has rights to use, all patents, patent
applications, trademarks, trademark applications, service marks, trade names,
copyrights, licenses and rights (collectively, the "Intellectual Property
Rights") which are necessary for use in connection with its business, as
currently conducted and as described in the SEC Documents, and which the
failure to so have would have a Material Adverse Effect. Except as disclosed
in Schedule 2.1(s), to the best
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knowledge of the Company, there is no existing infringement by another Person
of any of the Intellectual Property Rights which are necessary for use in
connection with the Company's business, as currently conducted and as described
in the SEC Documents.
(t) Acknowledgement of Dilution. The Company
acknowledges that the issuance of the Underlying Shares upon (i) conversion of
the Shares and payment of dividends thereon in accordance with the Certificates
of Designation and (ii) exercise of the Warrants may result in dilution of the
outstanding shares of Common Stock, which dilution may be substantial under
certain market conditions. The Company further acknowledges that its
obligation to issue Underlying Shares upon (x) conversion of the Shares and
payment of dividends thereon in accordance with the Certificates of Designation
and (y) upon exercise of the Warrants is unconditional and absolute subject to
the limitations set forth herein in the Certificate of Designation or pursuant
to the Warrants, regardless of the effect of any such dilution.
(u) Registration Rights; Rights of Participation. Except
as described on Schedule 2.1(u) hereto, (A) the Company has not granted or
agreed to grant to any Person any rights (including "piggy-back" registration
rights) to have any securities of the Company registered with the Commission or
any other governmental authority which has not been satisfied and (B) no
Person, including, but not limited to, current or former shareholders of the
Company, underwriters, brokers or agents, has any right of first refusal,
preemptive right, right of participation, or any similar right to participate
in the transactions contemplated by this Agreement or any other Transaction
Document.
(v) Title. The Company owns no real property. Except as
disclosed in Schedule 2.1(v), the Company and the Subsidiaries have good and
marketable title to all personal property owned by them which is material to
the business of the Company and its Subsidiaries, as currently conducted and as
described in the SEC Documents, in each case free and clear of all Liens,
except for Liens as do not materially affect the value of such property and do
not materially interfere with the use made and proposed to be made of such
property by the Company and its Subsidiaries. Any real property and facilities
held under lease by the Company and its Subsidiaries are held by them 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 and its Subsidiaries.
(w) Regulatory Permits. The Company and its Subsidiaries
possess all certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their
respective businesses as described in the SEC Documents except where the
failure to possess such permits would not, individually or in the aggregate,
have a Material Adverse Effect ("Material Permits"), and neither the Company
nor any such Subsidiary has received any notice of proceedings relating to the
revocation or modification of any Material Permit.
2.2 Representations and Warranties of the Purchasers. Each of the
Purchasers, severally and not jointly, hereby represents and warrants to the
Company as follows:
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(a) Organization; Authority. Each Purchaser is a
corporation duly incorporated or a limited partnership duly formed, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or formation with the requisite power and authority, corporate or
otherwise, to enter into and to consummate the transactions contemplated hereby
and by the Registration Rights Agreement and otherwise to carry out its
obligations hereunder and thereunder. The purchase by such Purchaser of the
Shares and the Warrants hereunder has been duly authorized by all necessary
action on the part of such Purchaser. Each of this Agreement and the
Registration Rights Agreement has been duly executed and delivered by such
Purchaser and constitutes the valid and legally binding obligation of such
Purchaser, enforceable against such Purchaser, in accordance with its terms, in
each case, except as rights to indemnification or contribution may be limited
by applicable laws, equitable principles or public policy and except as
enforceability thereof may be limited by applicable bankruptcy, reorganization,
moratorium, liquidation or other similar laws relating to or affecting
creditors' rights generally or by general equitable principles.
(b) Investment Intent. Each Purchaser is acquiring the
Shares, the Warrants and the Underlying Shares for its own account for
investment purposes only and not with a view to or for distributing or
reselling such Shares, Warrants or Underlying Shares or any part thereof or
interest therein, without prejudice, however, to such Purchaser's right,
subject to the provisions of this Agreement and the Registration Rights
Agreement, at all times to sell or otherwise dispose of all or any part of such
Shares, Warrants or Underlying Shares pursuant to an effective registration
statement under the Securities Act and in compliance with applicable state
securities laws or under an exemption from such registration.
(c) Purchaser Status. At the time such Purchaser was
offered the Shares and the Warrants, it was, and at the date hereof, it is, and
at each Closing Date and each exercise date under the Warrants, it will be, an
"accredited investor" as defined in Rule 501(a)(1)-(8) under the Securities
Act.
(d) Experience of Purchaser. Each Purchaser either alone
or together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of evaluating
the merits and risks of the prospective investment in the Shares, the Warrants
and the Underlying Shares, and has so evaluated the merits and risks of such
investment.
(e) Ability of Purchaser to Bear Risk of Investment.
Each Purchaser is able to bear the economic risk of an investment in the
Shares, the Warrants and the Underlying Shares and, on each of the Series A
Closing Date and the Series B Closing Date, as applicable, is able to afford a
complete loss of such investment.
(f) Access to Information. Each Purchaser acknowledges
receipt of the Disclosure Materials and further acknowledges that it has been
afforded (i) the opportunity to ask such questions as it has deemed necessary
of, and to receive answers from, representatives of the Company concerning the
terms and conditions of the offering of the Shares, the Warrants and the
Underlying Shares and the merits and risks of investing in the Shares, the
Warrants and
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the Underlying Shares; (ii) access to information about the Company and the
Company's financial condition, results of operations, business, properties,
management and prospects sufficient to enable it to evaluate its investment;
and (iii) the opportunity to obtain such additional information which the
Company possesses or can acquire without unreasonable effort or expense that is
necessary to make an informed investment decision with respect to the
investment and to verify the accuracy and completeness of the information
contained in the Disclosure Materials.
(g) Reliance. Each Purchaser understands and
acknowledges that (i) the Shares, the Warrants and the Underlying Shares are
being offered and sold to it without registration under the Securities Act in a
private placement that is exempt from the registration provisions of the
Securities Act under Section 4(2) of the Securities Act or Regulation D
promulgated thereunder and (ii) the availability of such exemption, depends in
part on, and the Company will rely upon the accuracy and truthfulness of, the
foregoing representations and warranties and such Purchaser hereby consents to
such reliance.
The Company acknowledges and agrees that the Purchasers make
no representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in this Section 2.2.
ARTICLE III
OTHER AGREEMENTS OF THE PARTIES
3.1 Transfer Restrictions. (a) If any Purchaser should decide to
dispose of the Shares or any portion of the Warrants (and upon conversion or
exercise thereof, as the case may be, of any of the Underlying Shares) held by
it, each Purchaser understands and agrees that it may do so only pursuant to an
effective registration statement under the Securities Act, to the Company or
pursuant to an available exemption from the registration requirements of the
Securities Act. In connection with any transfer of any Shares, Warrants or any
Underlying Shares other than pursuant to an effective registration statement or
to the Company, the Company may require the transferor thereof to provide to
the Company a written opinion of counsel experienced in the area of United
States securities laws selected by the transferor, the form and substance of
which opinion shall be reasonably satisfactory to the Company, to the effect
that such transfer does not require registration of such transferred securities
under the Securities Act. Notwithstanding the foregoing, the Company hereby
consents to and agrees to register (i) any transfer of Shares or Warrants by
one Purchaser to another Purchaser, and agrees that no documentation other than
executed transfer documents shall be required for any such transfer, and (ii)
any transfer of Shares or Warrants by any Purchaser to an Affiliate of such
Purchaser or to an Affiliate of another Purchaser, or any transfer among any
such Affiliates, provided that transferee certifies to the Company that it is
an "accredited investor" as defined in Rule 501(a) under the Securities Act.
Any such transferee shall be bound by the terms of this Agreement and shall
have the rights of a Purchaser under this Agreement and the Registration Rights
Agreement.
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(b) Each Purchaser agrees to the imprinting, so long as
is required by this Section 3.1(b), of the following legend on the Shares, the
Warrants and the Underlying Shares:
[NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE
SECURITIES ARE CONVERTIBLE [EXERCISABLE] HAVE] [THE SECURITIES
REPRESENTED HEREBY HAVE NOT] BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE PURSUANT TO AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
[FOR SHARES ONLY] THE SHARES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND CONVERSION SET
FORTH IN A CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT, DATED AS OF
FEBRUARY 27, 1998, EXECUTED BY THE ORIGINAL HOLDER HEREOF. A COPY OF
THAT AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF ONCORMED, INC.
The Underlying Shares issuable upon conversion of Shares or as
payment of dividends thereon or exercise of the Warrants shall not contain the
legend set forth above nor any other legend if, in the written opinion of
counsel to the Company experienced in the area of United States securities
laws, such legend is not required under applicable requirements of the
Securities Act (including judicial interpretations and pronouncements issued by
the staff of the Commission). The Company agrees that it will provide each
Purchaser, upon request, with a certificate or certificates representing
Underlying Shares, free from such legend at such time as such legend is no
longer required hereunder.
3.2 Stop Transfer Instruction. The Company may not make any
notation on its records or give instructions to any transfer agent of the
Company which expand the restrictions of transfer set forth in Section 3.1.
3.3 Furnishing of Information. As long as any Purchaser owns
Shares, Warrants or Underlying Shares, the Company covenants to timely file (or
obtain extensions in respect thereof and file within the applicable grace
period) all reports required to be filed by the Company after the date hereof
pursuant to Section 13(a) or 15(d) of the Exchange Act. As long as any
Purchaser owns Shares, Warrants or Underlying Shares, if the Company is not
required to file reports pursuant to Section 13(a) or 15(d) of the Exchange
Act, it will prepare and furnish to the Purchasers and make publicly available
in accordance with Rule 144(c) promulgated under the Securities Act annual and
quarterly financial statements, together with a discussion and
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analysis of such financial statements in form and substance substantially
similar to those that would otherwise be required to be included in reports
required by Section 13(a) or 15(d) of the Exchange Act, as well as any other
information required thereby, in the time period that such filings would have
been required to have been made under the Exchange Act. The Company further
covenants that it will take such further action as any holder of Shares may
reasonably request, all to the extent required from time to time to enable such
Person to sell Underlying Shares without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144 promulgated under
the Securities Act, including the legal opinion referenced above in this
Section. Upon the request of any such Person, the Company shall deliver to
such Person a written certification of a duly authorized officer as to whether
it has complied with such requirements.
3.4 Blue Sky Laws. In accordance with the Registration Rights
Agreement, the Company shall qualify or exempt the issuance and sale of the
Underlying Shares under the securities or Blue Sky laws of such jurisdictions
as the Purchasers may request and shall continue such qualification or
exemption at all times through the third anniversary of the last Closing Date;
provided, however, that neither the Company nor its Subsidiaries shall be
required in connection therewith to qualify as a foreign corporation where they
are not now so qualified or to take any action that would subject the Company
to general service of process in any such jurisdiction where it is not then so
subject or subject the Company to any material tax in any such jurisdiction
where it is not then so subject.
3.5 Integration. The Company shall not sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security (as
defined in Section 2 of the Securities Act) that would be integrated with the
offer or sale of the Shares, the Warrants or the Underlying Shares in a manner
that would require the registration under the Securities Act of the sale of the
Shares or the Underlying Shares to any Purchaser.
3.6 Certain Agreements. As long as any Purchaser owns Shares, the
Company shall not and shall cause the Subsidiaries not to, without the consent
of the holders of all of the Shares then outstanding, (i) amend its certificate
of incorporation, bylaws or other charter documents so as to adversely affect
any rights of any Purchaser with respect to the Shares or any rights of the
Purchasers pursuant to the Transaction Documents; (ii) declare, authorize, set
aside or pay any dividend or other distribution with respect to the Common
Stock except as permitted under the Certificates of Designation; (iii) except
in connection with open market purchases of Common Stock pursuant to a Company
direct stock purchase plan, repay, repurchase or offer to repay, repurchase or
otherwise acquire shares of its Common Stock in any manner; or (iv) enter into
any agreement with respect to any of the foregoing.
3.7 Listing and Reservation of Underlying Shares. (a) The
Company shall (i) not later than the fifth Trading Day following the applicable
Closing Date prepare and file with the AMEX (as well as any other national
securities exchange or quotation system on which the Common Stock is then
listed) an additional shares listing application or a letter acceptable to the
AMEX (or any other national securities exchange or quotation system on which
the Common Stock is then listed) covering and listing a number of shares of
Common Stock which is at least
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equal to 200% of the maximum number of Underlying Shares then issuable assuming
the payment of all future dividends on the Shares then outstanding were made in
shares of Common Stock, (ii) take all steps necessary to cause the Underlying
Shares to be approved for listing in the AMEX (as well as on any other national
securities exchange or quotation system on which the Common Stock is then
listed), and (iii) provide to the Purchasers evidence of such listing, and the
Company shall use its commercially reasonable efforts to maintain the listing
of its Common Stock on the AMEX (or any other national securities exchange or
quotation system on which the Common Stock is then listed).
(b) The Company shall reserve for issuance upon
conversion of the Shares and for payment of dividends thereupon in shares of
Common Stock pursuant to the terms of the Certificates of Designation and upon
exercise of the Warrants in accordance with their terms the number of shares to
be listed on the AMEX (and such other national securities exchange or market on
which the Common Stock is then listed or traded) as set forth in Section
3.7(a). Shares of Common Stock reserved for issuance upon the conversion of
the Shares as set forth in Section 3.7(a) shall be allocated pro rata to each
of the Purchasers in accordance with the amount of Shares issued and delivered
to such Purchaser at each Closing, as applicable.
3.8 No Violation of Applicable Law. Notwithstanding any provision
of this Agreement to the contrary, if the redemption of Shares or Underlying
Shares otherwise required under this Agreement or any other Transaction
Document would be prohibited by the relevant provisions of the Delaware General
Corporation Law, such redemption shall be effected as soon as it is permitted
under such law; provided, however, that from the 5th day after such redemption
notice until such redemption price is paid in full, interest on any such unpaid
amount shall accrue at the rate of 15% per annum.
3.9 Notice of Breaches. (a) Each of the Company and each
Purchaser shall give prompt written notice to the other of any breach of any
representation, warranty or other agreement contained in this Agreement or in
the Registration Rights Agreement, as well as any events or occurrences arising
after the date hereof and prior to the Series B Closing Date which would
reasonably be likely to cause any representation or warranty or other agreement
of such party, as the case may be, contained herein to be incorrect or breached
as of such Closing Date. However, no disclosure by either party pursuant to
this Section 3.9 shall be deemed to cure any breach of any representation,
warranty or other agreement contained herein or in the Registration Rights
Agreement.
(b) Notwithstanding the generality of Section 3.9(a), the
Company shall promptly notify each Purchaser of any notice or claim (written or
oral) that it receives from any lender of the Company to the effect that the
consummation of the transactions contemplated hereby and by the Registration
Rights Agreement violates or would violate any written agreement or
understanding between such lender and the Company, and the Company shall
promptly furnish by facsimile to the holders of the Shares a copy of any
written statement in support of or relating to such claim or notice.
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(c) The default by any Purchaser of any of its
obligations, representations or warranties under any Transaction Document shall
not be imputed to, and shall have no effect upon, any other Purchaser or affect
the Company's obligations under the Transaction Documents to any non-defaulting
Purchaser.
3.10 Conversion and Exercise Obligations of the Company. The
Company covenants to convert the Shares and to deliver Underlying Shares in
accordance with the terms and conditions and time period set forth in the
respective Certificates of Designation and to deliver Underlying Shares upon
exercise of Warrants in accordance with the terms and conditions and time
periods set forth in the Warrants.
3.11 Subsequent Registrations. Other than Underlying Shares and
other "Registrable Securities" (as defined in the Registration Rights
Agreement) to be registered in accordance with the Registration Rights
Agreement, the Company shall not, for a period of not less than 90 Trading Days
after the date that the respective Underlying Shares Registration Statement
relating to the securities issued at the Series A Closing Date and the Series B
Closing Date is declared effective by the Commission, without the prior written
consent of the Purchasers, (i) issue or sell any of its or any of its
Affiliates' equity or equity-equivalent securities pursuant to Regulation S
promulgated under the Securities Act, or (ii) register for resale any
securities of the Company. Any Trading Days that any Purchaser is unable to
sell Underlying Shares under an Underlying Shares Registration Statement shall
be added to such 90 Trading Day period for the purposes of (i) and (ii) above.
3.12 Press Release. The Company shall issue a press release within
two Trading Days of each of the Series A Closing Date and the Series B Closing
Date relating to the issue and sale of the Shares and Warrants to the
Purchasers which press releases shall be approved by each party to this
Agreement.
3.13 Use of Proceeds. The Company shall use all of the proceeds
from the sale of the Shares for working capital and general corporate purposes
and not for the satisfaction of any portion of Company borrowings or to redeem
Company equity or equity-equivalent securities. Pending application of the
proceeds of this placement in the manner permitted hereby, the Company will
invest such proceeds in interest bearing accounts and/or short-term, investment
grade interest bearing securities.
3.14 Reimbursement. In the event that any Purchaser, other than by
reason of its bad faith, gross negligence or willful misconduct, becomes
involved in any capacity in any action, proceeding or investigation brought by
or against any person, including stockholders of the Company, in connection
with or as a result of the consummation of the transactions contemplated
pursuant to the Transaction Documents, the Company will reimburse such
Purchaser for its reasonable legal and other expenses (including the cost of
any investigation and preparation) incurred in connection therewith. In
addition, with respect to each Purchaser, other than with respect to any matter
in which such Purchaser is a named party, the Company will pay such Purchaser
the reasonable charges, as reasonably determined by such Purchaser, for the
time of any officers or employees of such Purchaser devoted to appearing and
preparing to appear
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as witnesses, assisting in preparation for hearings, trials or pretrial
matters, or otherwise with respect to inquiries, hearings, trials, and other
proceedings relating to the subject matter of this Agreement. The
reimbursement obligations of the Company under this paragraph shall be in
addition to any liability which the Company may otherwise have, shall extend
upon the same terms and conditions to any affiliate of each Purchaser and
partners, directors, agents, employees and controlling persons (if any), as the
case may be, of each Purchaser and any such affiliate, and shall be binding
upon and inure to the benefit of any successors, assigns, heirs and personal
representatives of the Company, each Purchaser and any such affiliate and any
such person. The Company also agrees that no Purchaser or any such affiliates,
partners, directors, agents, employees or controlling persons shall have any
liability to the Company or any person asserting claims on behalf of or in
right of the Company in connection with or as a result of the consummation of
the Transaction Documents except to the extent that any losses, claims,
damages, liabilities or expenses incurred by the Company result from the bad
faith, gross negligence or willful misconduct of such Purchaser or entity in
connection with the transactions contemplated by this Agreement.
3.15 Conversion Limitation. In no event shall a Purchaser be
permitted to convert any shares of Preferred Stock in excess of the number of
such shares upon the conversion of which, (x) the number of shares of Common
Stock beneficially owned by such Purchaser (other than shares of Common Stock
issuable upon conversion of shares of Preferred Stock) plus (y) the number of
shares of Common Stock issuable upon the conversion of such shares of Preferred
Stock, would be equal to or exceed (z) 4.999% of the number of shares of Common
Stock then issued and outstanding, including shares issuable on conversion of
the Preferred Stock held by such Purchaser after application of this Section
3.15. As used herein, beneficial ownership shall be determined in accordance
with Section 13(d) of the Exchange Act and the rules thereunder. To the extent
that the limitation contained in this Section 3.15 applies, the determination
of whether shares of Preferred Stock are convertible (in relation to other
securities owned by a Purchaser) and of which shares of Preferred Stock are
convertible shall be in the sole discretion of such Purchaser, and the
submission of shares of Preferred Stock for conversion shall be deemed to be
such Purchaser's determination of whether such shares of Preferred Stock are
convertible (in relation to other securities owned by a Purchaser) and of which
shares of Preferred Stock are convertible, in each case subject to such
aggregate percentage limitation, and the Company shall have no obligation to
verify or confirm the accuracy of such determination. This paragraph may be
amended in order to clarify an ambiguity or otherwise to give effect to such
limitation, by the board of directors of the Company and the holders of
two-thirds (2/3) of the shares of Preferred Stock then outstanding. Nothing
contained herein shall be deemed to restrict the right of a Purchaser to
convert such shares of Preferred Stock at such time as such conversion will not
violate the provisions of this paragraph. The provisions of this Section 3.15
may be waived by a Purchaser as to itself (and solely as to itself) upon not
less than 65 days prior notice to the Company, and the provisions of this
Section 3.15 shall continue to apply until such 65th day (or later, if stated
in the notice of waiver).
3.16 Incyte Conversion Limitation. In no event shall Incyte be
permitted to convert any shares of Preferred Stock in excess of the number of
shares upon the conversion of which (x) the number of shares of Common Stock
owned by Incyte (other than shares of
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Common Stock issuable upon conversion of shares of Preferred Stock) plus (y)
the number of shares of Common Stock issuable upon the conversion of such
shares of Preferred Stock, would be equal to or exceed (z) 9.99% of the number
of shares of Common Stock then issued and outstanding, including shares
issuable upon conversion of the Preferred Stock held by Incyte after
application of this Section 3.16 (such number of shares of Preferred Stock in
excess of clause (z) to be referred to herein as the "Incyte Excess Shares").
To the extent that the limitation contained in this Section 3.16 applies, the
Company shall use commercially reasonable efforts to either (i) facilitate the
transfer of the Incyte Excess Shares to a third party at a price per share on
an as-converted basis equal to the Per Share Market Value for the Trading Day
immediately preceding the Conversion Date, or (ii) redeem, from funds legally
available therefor at the time of such redemption, the Incyte Excess Shares at
a price per share equal to the product of (i) the Per Share Market Value for
the Trading Day immediately preceding the Conversion Date and (ii) the
Conversion Ratio calculated on the Conversion Date.
ARTICLE IV
CONDITIONS
4.1 (a) Conditions Precedent to the Obligation of the
Company to Sell the Series A Shares. The obligation of the Company to sell the
Series A Shares and the Series A Warrants hereunder is subject to the
satisfaction by the Purchasers or waiver by the Company, at or before the
Series A Closing, of each of the following conditions:
(i) Accuracy of the Purchasers' Representations
and Warranties. The representations and warranties of each Purchaser shall be
true and correct in all material respects as of the date when made and as of
the Series A Closing Date, as though made on and as of such date;
(ii) Performance by the Purchasers. Each
Purchaser shall have performed, satisfied and complied in all material respects
with all covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by such Purchaser at or prior to the
Series A Closing, including, without limitation, payment of the Series A
Purchase Price; and
(iii) No Injunction. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement or the Registration Rights Agreement relating to
the issuance or conversion of any of the Shares or exercise of any of the
Warrants.
(b) Conditions Precedent to the Obligation of the
Purchasers to Purchase the Series A Shares. The obligation of each Purchaser
hereunder to acquire and pay for the Series A Shares is subject to the
satisfaction by the Company or waiver by such Purchaser, at or before the
Series A Closing, of each of the following conditions:
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(i) Accuracy of the Company's Representations and
Warranties. The representations and warranties of the Company set forth in
this Agreement and in the Registration Rights Agreement shall be true and
correct in all material respects as of the date when made and as of the Series
A Closing Date, as though made on and as of such date;
(ii) Performance by the Company. The Company
shall have performed, satisfied and complied in all material respects with all
covenants, agreements and conditions required by this Agreement and the
Registration Rights Agreement to be performed, satisfied or complied with by
the Company at or prior to the Series A Closing;
(iii) No Injunction. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement or the Registration Rights Agreement relating to
the issuance or conversion of any of the Shares or exercise of any of the
Warrants;
(iv) Adverse Changes. Since the date of the
financial statements included in the Company's Quarterly Report on Form 10-Q or
Annual Report on Form 10-K, whichever is more recent, last filed prior to the
date of this Agreement, no event which had a Material Adverse Effect and no
material adverse change in the financial condition or prospects of the Company
shall have occurred which is not disclosed in the Disclosure Materials (for
purposes hereof changes in the market price of the Common Stock may be
considered in determining whether there has occurred an event which has had a
Material Adverse Effect or whether a material adverse change has occurred);
(v) No Suspensions of Trading in Common Stock.
The trading in the Common Stock shall not have been suspended by the Commission
or on the AMEX (or such other exchange or quotation system on which the Common
Stock is then traded) which suspension shall remain in effect;
(vi) Legal Opinion. The Company shall have
delivered to the Purchasers the opinion of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, the
Company's counsel, in substantially the form attached hereto as Exhibit D,
respectively;
(vii) Required Approvals. All Required Approvals
required to have been made on or prior to the Series A Closing Date shall have
been obtained;
(viii) Shares of Common Stock. On or prior to the
Series A Closing Date, the Company shall have duly reserved the number of
Underlying Shares required by the Transaction Documents to be reserved for
issuance upon conversion of Series A Shares and payment of dividends thereon
and exercise of the Series A Warrants;
(ix) Delivery of Stock Certificates. The Company
shall have delivered to each Purchaser or such Purchaser's designee the stock
certificate(s) representing the Series A Shares, registered in the name of such
Purchaser, each in form satisfactory to the Purchaser;
-19-
21
(x) Registration Rights Agreement. The Company
shall have executed and delivered the Registration Rights Agreement;
(xi) Certificates of Designation. The Series A
Designation shall have been duly filed with the Secretary of State of Delaware
and the Company shall have delivered a copy thereof to the Purchaser certified
as filed by the office of the Secretary of State of Delaware;
(xii) Change of Control. No Change of Control (as
hereafter defined) shall have occurred between the date hereof and the Series A
Closing Date; and
(xiii) Transfer Agent Instructions. The Irrevocable
Transfer Agent Instructions, in the form of Exhibit E attached hereto, shall
have been delivered to and acknowledged in writing by the Company's transfer
agent.
4.2 (a) Conditions Precedent to the Obligation of
the Company to Sell the Series B Shares. The obligation of the Company to sell
the Series B Shares and the Series B Warrants hereunder is subject to the
satisfaction by the Purchasers or waiver by the Company, at or before the
Series B Closing, of each of the following conditions:
(i) Accuracy of the Purchasers' Representations
and Warranties. The representations and warranties of each Purchaser shall be
true and correct in all material respects as of the date when made and as of
the Series B Closing Date, as though made on and as of such date;
(ii) Performance by the Purchasers. Each
Purchaser shall have performed, satisfied and complied in all material respects
with all covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by such Purchaser at or prior to the
Series B Closing, including, without limitation, payment of the Series B
Purchase Price; and
(iii) No Injunction. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement or the Registration Rights Agreement relating to
the issuance or conversion of any of the Shares or exercise of any of the
Warrants.
(b) Conditions Precedent to the Obligation of the
Purchasers to Purchase the Series B Shares. The obligation of each Purchaser
hereunder to acquire and pay for the Series B Shares is subject to the
satisfaction by the Company or waiver by each Purchaser, at or before the
Series B Closing of each of the following conditions:
(i) Series A Closing. The Series A Closing shall
have occurred;
-20-
22
(ii) Accuracy of the Company's Representations and
Warranties. The representations and warranties of the Company contained herein
and in the Registration Rights Agreement shall be true and correct in all
material respects as of the date when made and as of the Series B Closing Date
as though made on and as of such date;
(iii) Performance by the Company. The Company
shall have performed, satisfied and complied in all material respects with all
covenants, agreements and conditions required by this Agreement and the
Registration Rights Agreement to be performed, satisfied or complied with by
the Company at or prior to the Series B Closing Date;
(iv) Underlying Shares Registration Statement.
The Underlying Shares Registration Statement with respect to the Underlying
Shares issuable on conversion of all outstanding Series A Shares and as payment
of dividends thereon and exercise of the Series A Warrants shall have been
declared effective under the Securities Act by the Commission. On such Closing
Date, the Underlying Shares Registration Statement shall be effective, not
subject to any stop order and not be subject to any suspension pursuant to
Section 3(p) of the Registration Rights Agreement, and shall have been
effective and shall not have been subject to any stop order for the ninety (90)
days prior to such Closing Date and no stop order shall be pending or
threatened as at such Closing Date;
(v) No Injunction. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court of governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement or the Registration Rights Agreement relating to
the issuance or conversion of any of the Shares or exercise of the Warrants;
(vi) Adverse Changes. Since the date of the
financial statements included in the Company's Quarterly Report on Form 10-Q or
Annual Report on Form 10-K, whichever is more recent, last filed prior to the
date of this Agreement, no event which had a Material Adverse Effect and no
material adverse change in the financial condition or prospects of the Company
shall have occurred which is not disclosed in the Disclosure Materials (for
purposes hereof changes in the market price of the Common Stock may be
considered in determining whether there has occurred an event which has had a
Material Adverse Effect or whether a material adverse change has occurred);
(vii) Litigation. No litigation shall have been
instituted or threatened against the Company, which, if determined adversely to
the Company, could have a Material Adverse Effect;
(viii) Management. In the reasonable judgment of
each Purchaser, there have been no substantial changes in the senior management
of the Company;
(ix) No Suspensions of Trading in Common Stock.
The trading in the Common Stock shall not have been suspended by the Commission
or on the AMEX (or any other national securities exchange or quotation system
on which the Common Stock is then
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23
listed) (except for any suspension of trading of limited duration solely to
permit dissemination of material information regarding the Company or as a
result of exchange imposed "circuit brakers");
(x) Listing of Common Stock. The Common Stock
shall have been at all times since the Series A Closing Date listed for
trading on the AMEX (or any other national securities exchange or quotation
system on which the Common Stock is then listed);
(xi) Change of Control. No Change of Control in
the Company shall have occurred. "Change of Control" means the occurrence of
any of (i) an acquisition after the date hereof by an individual or legal
entity or "group" (as described in Rule 13d-5(b)(1) promulgated under the
Exchange Act) of in excess of 50% of the voting securities of the Company, (ii)
a replacement of more than one-half of the members of the Company's board of
directors which is not approved by those individuals who are members of the
board of directors on the date hereof in one or a series of related
transactions, (iii) the sale of all or substantially all of the assets of the
Company in one or a series of related transactions, (iv) the merger or
consolidation of the Company with or into another entity unless the holders of
the Common Stock immediately prior to such transactions continue to hold at
least 50% of such securities immediately following such transaction or (v) the
execution by the Company of an agreement to which the Company is a party or by
which it is bound, providing for any of the events set forth above in (i), (ii)
or (iii);
(xii) Legal Opinion. The Company shall have
delivered to the Purchasers the opinions of the Company's counsel, in
substantially the form attached hereto as Exhibit D dated the Series B Closing
Date;
(xiii) Required Approvals. All Required Approvals
required to have been made on or prior to the Series B Closing Date shall have
been obtained;
(xiv) Shares of Common Stock. On the Series B
Closing Date, the Company shall have duly reserved the number of Underlying
Shares required by this Agreement to be reserved for issuance upon conversion
of Series B Shares and payment of dividends thereon;
(xv) Delivery of Stock Certificates. The Company
shall have delivered to each Purchaser or such Purchaser's designee the stock
certificate(s) representing the Series B Shares, registered in the name of such
Purchaser, each in form satisfactory to such Purchaser;
(xvi) Certificates of Designation. The Series B
Designation shall have been duly filed with the Secretary of State of Delaware
and the Company shall have delivered a copy thereof to the Purchaser certified
as filed by the office of the Secretary of State of Delaware;
(xvii) Performance of Conversion/Exercise
Obligations. The Company shall have (a) delivered Underlying Shares upon
conversion of Series A Shares and otherwise
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24
performed its obligations in accordance with the terms, conditions and timing
requirements of each Certificate of Designation and (b) delivered Underlying
Shares upon exercise of the Series A Warrants and otherwise performed its
obligations in accordance with the terms of the Series A Warrants;
(xviii) Closing Thresholds. For the thirty Trading
Days immediately prior to the Series B Closing Date (the "Look-Back Period")
(i) the average Per Share Market Value shall have been equal or greater than
$8.00, and (ii) the average trading volume for the Common Stock shall have been
equal or greater than 25,000 shares, provided, however, that, with respect to
clause (ii) above, any Trading Day during the Look-Back Period in which the
trading volume in the Common Stock exceeds 75,000 shares shall be excluded from
the Look-Back Period and the Look-Back Period shall be extended backward by one
additional Trading Day for each Trading Day so excluded;
(xix) Research Coverage. ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP or
any comparable investment banking firm reasonably satisfactory to the
Purchasers shall be providing research coverage on the Company;
(xx) Transfer Agent Instructions. The Irrevocable
Transfer Agent Instructions, in the form of Exhibit E attached hereto, shall
have been delivered to and acknowledged in writing by the Company's transfer
agent; and
(xxi) Updated Schedules. If the Company has made
any changes to the Schedules to this Agreement as permitted under Section
2.1(i), such changes shall be satisfactory to the Purchasers.
(xxii) Officer's Certificate. On the Series B
Closing Date the Company shall deliver to the Purchasers an Officer's
Certificate dated the Closing Date and signed by an executive officer of the
Company confirming the accuracy of the Company's representations, warranties
and covenants as of the Series B Closing Date and confirming the compliance by
the Company with the conditions precedent set forth in this Section 4.2 as of
the Series B Closing Date.
ARTICLE V
MISCELLANEOUS
5.1 Fees and Expenses. The Company shall pay $20,000 to
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ LLP, counsel to the Purchasers
(which shall be credited against the amounts paid by the Company pursuant to
Section 3 of the Engagement Letter) in connection with the preparation of the
Transaction Documents and for such counsel's representation of the Purchasers
in connection with the transactions contemplated by the Transaction Documents,
and otherwise each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses incurred
-23-
25
by such party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement, except as set forth in the Registration Rights
Agreement. The Company shall pay all stamp and other taxes and duties levied
in connection with the issuance of the Shares pursuant hereto.
5.2 Entire Agreement; Amendments. This Agreement,
together with the Exhibits and Schedules hereto, the Registration Rights
Agreement, each Certificate of Designation (each when filed) and the Warrants
contain the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or
written, with respect to such matters, except that the provisions of Section 3
and Section 5 of the Engagement Letter shall survive.
5.3 Notices. Any notice or other communication required
or permitted to be given hereunder shall be in writing and shall be deemed to
have been received (a) upon hand delivery (receipt acknowledged) or delivery by
telex (with correct answer back received), telecopy or facsimile (with
transmission confirmation report) at the address or number designated below (if
delivered on a Trading Day during normal business hours where such notice is to
be received), or the first Trading Day following such delivery (if delivered on
a Trading Day after during normal business hours where such notice is to be
received) or (b) on the second Trading Day following the date of mailing by
express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be as set forth below each parties name on Schedule
1, and if to the Company with copies to ▇▇▇▇▇▇▇, Phleger & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., fax:
(▇▇▇) ▇▇▇-▇▇▇▇, and if to any Purchaser with copies to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq., fax: (▇▇▇) ▇▇▇-▇▇▇▇, or such other address as
may be designated in writing hereafter, in the same manner, by such person.
5.4 Amendments; Waivers. No provision of this Agreement
may be waived or amended except in a written instrument signed, in the case of
an amendment, by both the Company and the Purchasers; or, in the case of a
waiver, by the party against whom enforcement of any such waiver is sought. No
waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a
waiver of any other provision, condition or requirement hereof, nor shall any
delay or omission of either party to exercise any right hereunder in any manner
impair the exercise of any such right accruing to it thereafter.
5.5 Headings. The headings herein are for convenience
only, do not constitute a part of this Agreement and shall not be deemed to
limit or affect any of the provisions hereof.
5.6 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties and their successors and
permitted assigns. The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of each of the
Purchasers. No Purchaser may assign this Agreement (other than to an Affiliate
of such Purchaser) or any rights or obligations hereunder without the prior
-24-
26
written consent of the Company, except that any Purchaser may assign its rights
hereunder and under the Transaction Documents without the consent of the
Company as long as such assignee demonstrates to the reasonable satisfaction of
the Company its satisfaction of the representations and warranties set forth in
Section 2.2 and such assignment is to an Affiliate of such Purchaser. This
provision shall not limit a Purchaser's right to transfer securities or
transfer or assign rights hereunder or under the Registration Rights Agreement.
5.7 No Third-Party Beneficiaries. This Agreement is
intended for the benefit of the parties hereto and their respective permitted
successors and assigns and is not for the benefit of, nor may any provision
hereof be enforced by, any other person.
5.8 Governing Law. This Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York without regard to the principles of conflicts of law thereof. Each
party hereby irrevocably submits to the non-exclusive jurisdiction of the
federal courts sitting in the City of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law.
5.9 Survival. The agreements and covenants contained in
Article III and this Article V shall survive the delivery and conversion of the
Shares pursuant to this Agreement and the representations and warranties of the
Company and the Purchasers contained in Article II shall survive each Closing
hereunder and any conversion of the Shares and exercise of the Warrants.
5.10 Execution. This Agreement may be executed in two or
more counterparts, all of which when taken together shall be considered one and
the same agreement and shall become effective when counterparts have been
signed by each party and delivered to the other party, it being understood that
both parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission, such signature shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) the same with the same force and effect as if such
facsimile signature page were an original thereof.
5.11 Publicity. The Company and each Purchaser shall
consult with each other in issuing any press releases or otherwise making
public statements with respect to the
-25-
27
transactions contemplated hereby and neither party shall issue any such press
release or otherwise make any such public statement without the prior written
consent of the other, which consent shall not be unreasonably withheld or
delayed, except that no prior consent shall be required if such disclosure is
required by law, in which such case the disclosing party shall provide the
other party with prior notice of such public statement. The Company shall not
publicly or otherwise disclose the names of any of the Purchasers without each
such Purchaser's prior written consent, except that no prior consent shall be
required if such disclosure is required by law, in which such case the
disclosing party shall provide the other party with prior notice of such public
statement.
5.12 Severability. In case any one or more of the
provisions of this Agreement shall be invalid or unenforceable in any respect,
the validity and enforceability of the remaining terms and provisions of this
Agreement shall not in any way be affecting or impaired thereby and the parties
will attempt to agree upon a valid and enforceable provision which shall be a
reasonable substitute therefor, and upon so agreeing, shall incorporate such
substitute provision in this Agreement.
5.13 Remedies. In addition to being entitled to exercise
all rights provided herein or granted by law, including recovery of damages,
the parties hereto will be entitled to specific performance of the obligations
of the other parties under the Transaction Documents. Each of the Company and
the Purchasers (severally and not jointly) agree that monetary damages would
not be adequate compensation for any loss incurred by reason of any breach of
its obligations described in the foregoing sentence and hereby agrees to waive
in any action for specific performance of any such obligation the defense that
a remedy at law would be adequate.
5.14 Independent Nature of Purchasers' Obligations and
Rights. The obligations of each Purchaser hereunder is several and not joint
with the obligations of the other Purchasers hereunder, and no Purchaser shall
be responsible in any way for the performance of the obligations of any other
Purchaser hereunder. Nothing contained herein or in any other agreement or
document delivered at any Closing, and no action taken by any Purchaser
pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert with
respect to such obligations or the transactions contemplated by this Agreement.
Each Purchaser shall be entitled to protect and enforce its rights, including
without limitation the rights arising out of this Agreement or out of the other
Transaction Documents, and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose.
5.15 No Reliance. Each party acknowledges that (i) it has
such knowledge in business and financial matters as to be fully capable of
evaluating this Agreement, the other Transaction Documents and the transactions
contemplated hereby and thereby, (ii) it is not relying on any advice or
representation of the other party in connection with entering into this
Agreement, the other Transaction Documents or such transactions (other than the
representations made in this Agreement or the other Transaction Documents),
(iii) it has not
-26-
28
received from such party any assurance or guarantee as to the merits (whether
legal, regulatory, tax, financial or otherwise) of entering into this Agreement
or the other Transaction Documents or the performance of its obligations
hereunder and thereunder, and (iv) it has consulted with its own legal,
regulatory, tax, business, investment, financial and accounting advisors to the
extent that it has deemed necessary, and has entered into this Agreement and
the other Transaction Documents based on its own independent judgment and on
the advice of its advisors as it has deemed necessary, and not on any view
(whether written or oral) expressed by such party.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOLLOWS]
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29
IN WITNESS WHEREOF, the parties hereto have caused this
Convertible Preferred Stock Purchase Agreement to be duly executed by their
respective authorized persons as of the date first indicated above.
ONCORMED, INC. SOUTHBROOK INTERNATIONAL INVESTMENTS,
LTD.
By: /s/ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, JR By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------- ----------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, JR Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: VP & CFO Title: ATTORNEY-IN-FACT
▇▇▇▇▇▇▇▇ INVESTMENTS L.P.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: AUTHORIZED SIGNATORY
MONTROSE INVESTMENTS, LTD.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: AUTHORIZED SIGNATORY
▇▇▇▇▇ ▇▇▇▇▇▇▇ STRATEGIC GROWTH FUND,
L.P.
By:/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: PRINCIPAL
▇▇▇▇▇ ▇▇▇▇▇▇▇ STRATEGIC GROWTH FUND,
LTD.
By:/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: PRINCIPAL
INCYTE PHARMACEUTICALS, INC.
By:
----------------------------------
Name:
Title:
30
SCHEDULE 1
Company:
-------
ONCORMED, INC.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Purchasers:
----------
SOUTHBROOK INTERNATIONAL INVESTMENTS, LTD.
c/o Trippoak Advisors, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Portion of Series A Purchase Price - $1,250,000
Series A Shares - 125
Number of Shares
underlying Warrant - 62,500
▇▇▇▇▇▇▇▇ INVESTMENTS L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Portion of Series A Purchase Price - $440,000
Series A Shares - 44
Number of Shares
underlying Warrant - 21,875
MONTROSE INVESTMENTS, LTD.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Portion of Series A Purchase Price - $810,000
Series A Shares - 81
Number of Shares
underlying Warrant - 40,625
31
▇▇▇▇▇ ▇▇▇▇▇▇▇ STRATEGIC GROWTH FUND, L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Portion of Series A Purchase Price - $120,000
Series A Shares - 12
Number of Shares
underlying Warrant - 6,000
▇▇▇▇▇ ▇▇▇▇▇▇▇ STRATEGIC GROWTH FUND, LTD.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Portion of Series A Purchase Price - $380,000
Series A Shares - 38
Number of Shares
underlying Warrant - 19,000
INCYTE PHARMACEUTICALS, INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Executive Officer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Portion of Series A Purchase Price - $330,000
Series A Shares - 33
Number of Shares
underlying Warrant - 16,666