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EXHIBIT 10.14
CONFIDENTIAL TREATMENT REQUESTED BY ABGENIX, INC.
STOCK PURCHASE
and
TRANSFER-AGREEMENT
THIS AGREEMENT is made and entered into this 15th day of July, 1996, by and
between CELL GENESYS, INC. ("CG") and ABGENIX, INC. ("ABGENIX") .
CG is engaged, among other activities, in the Antibody Business as defined
in Article 1.
CG's Board of Directors has determined that CG will (a) transfer to ABGENIX
the assets of the Antibody Business and other specified assets and liabilities
related to the Antibody Business as set forth herein, (b) provide $10,000,000 in
cash to ABGENIX to fund its operations, (c) cause ABGENIX to issue to CG shares
of ABGENIX's Series A Senior and Series 1 Subordinated Convertible Preferred
Stock as set forth in Article 2, and (d) lend ABGENIX up to $4,000,000 in
exchange for a convertible promissory note.
The parties hereto have determined that it is necessary and desirable to
set forth in this Agreement and in the Transaction Agreements (as defined in
Section 3(h)) the principal corporate transactions determined by CG and ABGENIX
to be appropriate to effect the transfer of the Antibody Business to ABGENIX and
to set forth other agreements and undertakings by and between CG and ABGENIX.
Simultaneously with the execution of this Stock Purchase and Transfer
Agreement, CG and ABGENIX are entering into the Transaction Agreements.
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NOW, THEREFORE, in consideration of the promises and the mutual
representations, warranties, covenants and agreements, and upon the terms and
subject to the conditions hereinafter set forth, the parties do hereby agree as
follows:
1. Definitions.
"Antibody Business" shall mean the discovery, research, development,
manufacturing, marketing and use for any purpose of all products that contain
antibodies (excluding any Universal Receptor Product and any Gene Therapy
Product), from any source, and the discovery, creation, development and use of
transgenic mouse strains that make antibodies containing human variable regions.
"ABGENIX Biological Materials" shall mean, without limitation, all
cell lines, hybridomas, antibodies, YACs, vectors, mice and all other materials
that relate to the Antibody Business as set forth on Exhibit A-1 hereto (which
such Exhibit shall be updated and completed by mutual agreement of the parties
no later than September 15, 1996).
"CG Biological Materials" shall mean, without limitation, the
materials as set forth on Exhibit A-2 hereto (which such Exhibit shall be
updated and completed by mutual agreement of the parties no later than September
15, 1996).
"Closing" shall have the meaning given in Section 5.1.
"Collaboration Agreement" shall mean the Collaboration Agreement among
CG, JT Immunotech USA Inc. and Xenotech, L.P. effective June 12, 1991, as
amended.
"Gene Therapy Product" shall mean a product based on the transfer or
use of DNA, RNA, or hybrids thereof to treat or
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prevent disease by means of ex vivo or in vivo gene delivery, including without
limitation the use of both viral and non-viral gene transfer systems.
"Joint Biological Materials" shall mean, without limitation, the materials
as set forth on Exhibit A-3 hereto (which such Exhibit shall be updated and
completed by mutual agreement of the parties no later than September 15, 1996).
"Know-How" shall mean, without limitation, all methods, prototypes,
techniques, processes, technical and other information, unpatented inventions,
trade secrets, concepts, ideas, data, experimental methods and results,
sequences, assays, descriptions, protocols, business or scientific plans,
correspondence, competitor information, depictions, supplier lists and any other
information that relates to or is useful in the Antibody Business.
"MRLOA" shall mean the Master Research License and Option Agreement
effective June 28, 1996, by and among CG, Japan Tobacco Inc., and Xenotech, L.P.
"Patent Rights" shall mean (i) all U.S. patents and patent applications
listed on Exhibit B hereto and patents issuing on such applications; (ii) any
continuations, continuations-in-part, divisionals, reexaminations, reissues or
extensions of any of (i) above and (iii) any foreign counterparts issued or
issuing on any of (i) or (ii) above.
"Note" shall mean the Convertible Promissory Note in the form of Exhibit I.
"Preferred Stock" shall have the meaning given in Section 2.1.
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"Transaction Agreements" shall mean the Services Agreement, the
Immunization Services Agreement, the Governance Agreement, the Tax Sharing
Agreement, the Gene Therapy Rights Agreement, the Voting Agreement, the Note,
and the Patent Assignment Agreement, each by and between CG and ABGENIX and of
even date herewith, attached hereto respectively, as ▇▇▇▇▇▇▇▇ ▇, ▇, ▇, ▇, ▇, ▇,
▇ and J.
"Universal Receptor Product" shall have the meaning set forth in the MRLOA.
2. Purchase and Sale of Shares of Preferred Stock; Loan.
2.1 Subject to the terms and conditions hereof and in reliance upon
the representations, warranties, covenants and agreements hereinafter set forth,
ABGENIX shall issue and sell to CG, and CG shall subscribe for and purchase from
ABGENIX 1,691,667 shares of Series A Senior Convertible Preferred Stock and
2,058,333 shares of Series 1 Subordinated Convertible Preferred Stock of ABGENIX
(collectively, the "Preferred Stock"), having the designations, powers,
preferences and voting, conversion and other special rights and qualifications,
limitations and restrictions set forth in Exhibit K hereto for the consideration
specified in Section 5 hereof.
2.2 Subject to the terms and conditions hereof, CG agrees to make a
loan to ABGENIX in the principal amount of up to $4,000,000 in exchange for
which ABGENIX will execute the Note.
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3. Representations and Warranties of ABGENIX.
ABGENIX represents and warrants to CG that:
(a) Organization, Good Standing, Power, Etc. ABGENIX (i) is a
corporation duly incorporated; validly existing and in good standing under the
laws of Delaware; (ii) has not yet commenced to do business in any other
jurisdiction; and (iii) has all requisite corporate power and authority to (x)
own or lease and operate its properties and carry on its business as presently
being conducted and (y) execute, deliver and perform this Agreement and
consummate the transactions contemplated hereby.
(b) Articles of Incorporation and By-Laws. ABGENIX's Certificate of
Incorporation and By-Laws, copies of which are attached hereto as Exhibits L and
M, are in full force and effect and ABGENIX is not in violation of any of the
provisions thereof.
(c) Capitalization. The authorized capital stock of ABGENIX consists
as of the date hereof of 20,000,000 shares of Preferred Stock, par value $0.0001
per share, of which on the date hereof no shares are issued and outstanding, and
50,000,000 shares of Common Stock, par value $0.0001 per share, of which on the
date hereof, no shares are issued and outstanding.
(d) Outstanding Rights to Purchase Securities. ABGENIX does not have
outstanding any options, warrants, or other rights to purchase or to convert any
security or obligation into, any shares of its capital stock, nor has ABGENIX
agreed to issue or sell any shares of its capital stock; however, ABGENIX has
committed to adopt a stock plan covering 1,600,000 shares of its Common Stock
for grants of stock options and restricted stock to employees, consultants and
directors.
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(e) Valid Issuance. The Preferred Stock, when issued, paid for and
delivered as contemplated by this Agreement, will be validly issued and fully
paid.
(f) Authorization of Agreement. This Agreement and the Transaction
Agreements have been duly and validly authorized, executed and delivered by
ABGENIX (and assuming due authorization, execution and delivery by CG)
constitute valid and binding obligations of ABGENIX.
(g) Effect of Agreement, Etc. The execution, delivery and performance
of this Agreement and consummation of the transactions contemplated hereby in
the manner contemplated herein will not, to the reasonable best knowledge of
ABGENIX, violate any material provisions of law, statute, rule or regulation to
which ABGENIX is subject.
(h) Government Consents. To the reasonable best knowledge of ABGENIX,
no consent; authorization, license, permit, registration or approval of, or
exemption or other action by, any governmental or public body or authority
except the Commissioner of Corporations of the State of California is required
in connection with (i) the execution, delivery, and performance by ABGENIX of
this Agreement; (ii) the issuance, sale and delivery of the Preferred Stock; and
(iii) the execution, delivery and performance in substantially the forms
attached hereto of the Transaction Agreements.
4. Representations and Warranties of CG.
CG represents and warrants to ABGENIX that:
(a) Organization, Good Standing, Power, Etc. CG (i) is a corporation
duly incorporated, validly existing and in
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good standing under the laws of the State of Delaware; (ii) is duly qualified to
do business and is in good standing in each United States jurisdiction in which
failure to do so would have a material adverse effect on its business; and (iii)
has all requisite power and authority to (x) own or lease and operate its
properties and carry on its business as presently being conducted and (y)
execute, deliver and perform this Agreement and consummate the transactions
contemplated hereby and thereby.
(b) Authorization of Agreements. This Agreement and the Transaction
Agreements have been duly and validly authorized, executed and delivered by CG
and (and assuming due authorization, execution and delivery by ABGENIX)
constitute the valid and binding obligations of CG;
(c) Government Consents. To the reasonable best knowledge of CG; no
consent, authorization, license, permit, registration or approval of, or
exemption or other action by, any governmental or public body or authority
except the Commissioner of Corporations of the State of California is required
in connection with (i) the execution, delivery and performance by CG of this
Agreement and (ii) the execution, delivery and performance of the Transaction
Agreements.
(d) Effect of Agreements, Etc. The execution, delivery and performance
of this Agreement, and the Transaction Agreements and consummation of the
transactions contemplated hereby and thereby in the manner contemplated herein
and therein will not, with or without the giving of notice or the lapse of time
or both, to the reasonable best knowledge of CG (i) violate any material
provisions of law, statute, rule or regulation to
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which CG is subject; (ii) violate any judgment, order, writ, injunction or
decree of any court applicable to CG; or (iii) result in the breach of, or
conflict with any material term, covenant, condition or provision of, require
the modification or termination of, constitute a default under, or result in the
creation or imposition of any material lien, pledge, mortgage, claim, charge or
any encumbrance whatsoever upon any of the properties or assets of CG pursuant
to any corporate charter, by-law, commitment, contract or other agreement or
instrument to which CG is a party or by which any of its assets or properties is
or may be bound or affected or from which CG derives material benefit.
(e) Investment Purposes. It is acquiring the Preferred Stock and Note
for its account as principal, for investment purposes only, and not with a view
to, or for, resale, distribution or fractionalization thereof, in whole or in
part, and no other person has a direct or indirect beneficial interest in the
Preferred Stock or Note.
(f) Private Placement. It acknowledges that the offering and sale of
the Preferred Stock and the Note are intended to be exempt from registration
under the Securities Act of 1933, as amended (the "Securities Act"), by virtue
of Section 4(2) of the Securities Act and the provisions of Regulation D
promulgated thereunder.
(g) Accredited Investor. It is capable of evaluating the merits and
risks of its investment in ABGENIX and has the capacity to protect its own
interests.
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5. Closing; Purchase Price.
5.1 Subject to the terms and conditions of this Agreement, the
issuance and sale of the Preferred Stock and consummation of the other
transactions contemplated hereby (the "Closing") shall take place at 3:0O P.M,
on July 19, 1996 or such other time or date as the parties may agree at the
offices of CG at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇.
5.2 Subject to the terms and condition of this Agreement, ABGENIX will
deliver to CG at the Closing:
5.2.1 Certificates for the shares of Preferred Stock registered
in the name of CG against payment therefor as set forth in Section 5.3 hereof;
5.2.2 duly executed copies of the Transaction Agreements; and
5.2.3 the Note; provided that if at the Closing a permit has not
been received from the California Department of Corporations for issuance of the
Note, the parties shall use good faith efforts to obtain such permit and the
Note shall be delivered upon its receipt.
5.3 Subject to the terms and conditions of this Agreement, CG will:
5.3.1 In exchange for the shares of Series A Senior Convertible
Preferred Stock, (a) deliver or transfer to the account of ABGENIX the sum of
$10 million in readily available funds and (b) assign the employee notes in the
aggregate principal amount of $150,000 listed on Exhibit N hereto;
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5.3.2 In exchange for the shares of Series 1 Subordinated
Preferred Stock, assign to ABGENIX all of its right, title and interest in and
to the assets of the Antibody Business including but not limited to (a) the
Patent Rights, (b) all Know-How that relates exclusively to the Antibody
Business and all Know-How as defined in the Collaboration Agreement (c) the
ABGENIX Biological Materials, (d) the equipment, furniture and fixtures leased
by CG and used in the Antibody Business as listed on Exhibit O hereto (which
such Exhibit shall be updated and completed by mutual agreement of the parties
no later than September 15, 1996), subject to the assumption by ABGENIX of the
remaining lease obligations for such capital equipment, (e) existing agreements
that relate to the Antibody Business including but not limited to the agreements
listed on Exhibit P hereto (which such Exhibit shall be updated and completed by
mutual agreement of the parties no later than September 15, 1996), subject to
the assumption by ABGENIX of and its agreement to perform any obligation
thereunder and the indemnification agreement of ABGENIX as set forth in Section
8.3, (f) CG's partnership interest in Xenotech, L.P., (g) all shares of capital
stock owned by CG in Xenotech, Inc., and (h) the Mice or rights to the Mice as
such term is defined in the MRLOA;
5.3.3 Grant to ABGENIX as further consideration (and CG hereby
makes such grant effective at the Closing) a worldwide, royalty-free, fully paid
up, perpetual, irrevocable license, with the right to sublicense, to use the
Joint Biological Materials and to practice any Know-How owned or controlled by
CG that relates both to the Antibody Business and
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to other businesses of CG, and to make, have made, sell or otherwise distribute
products incorporating the Joint Biological Materials and such Know-How, which
license shall be for use solely in the Antibody Business and the Expanded Field
(as such term is defined in the Collaboration Agreement), and which shall be
exclusive within such field of use;
5.3.4 Grant to ABGENIX as further consideration (and CG hereby
makes such grant effective at the Closing) a worldwide, royalty-free, fully paid
up, perpetual, irrevocable license, with the right to sublicense, to use the CG
Biological Materials, and to make, have made, sell or otherwise distribute
products incorporating the CG Biological Materials, which license shall be for
use solely in the Antibody Business, and which shall be exclusive within such
field of use;
5.3.5 Grant to ABGENIX as further consideration (And CG hereby
makes such grant effective at the Closing) a nonexclusive, worldwide,
royalty-free, fully paid up, perpetual, irrevocable license, with the right to
sublicense, to practice any Know-How and to use any reagents and other materials
owned or controlled by CG that may be unrelated to the Antibody Business, and to
make, have made, sell or otherwise distribute products incorporating such
Know-How and materials, to the extent required to practice the Patent Rights and
the Know-How assigned to ABGENIX pursuant to Section 5.3.2 or licensed under
Sections 5.3.3 or 5.3.4;
5.3.6 Deliver to ABGENIX duly executed copies of the Transaction
Agreements.
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5.4 Subject to the terms and conditions of this Agreement, ABGENIX
will grant to CG (and ABGENIX hereby makes such grant effective at the Closing),
a worldwide, royalty-free, fully paid up, perpetual, irrevocable license, with
the right to sublicense, under Patent Rights arising under patent docket number
Cell 22 (as set forth on Exhibit B), to make, have made, use, sell or otherwise
distribute products covered by such patent outside of the Antibody Business,
which license shall be exclusive in such field of use except for any rights of
JT Immunotech USA Inc., in the Expanded Field.
5.5 Notwithstanding the provisions of Section 5.3.2, no agreement
shall be assigned hereunder if such assignment would constitute a breach
thereof. If any agreement set forth above cannot be assigned by CG to ABGENIX
because, despite its reasonable best efforts, CG is unable to secure the
required consent of a third party to such assignment, CG, if intellectual
property is involved, will grant to ABGENIX an exclusive, worldwide,
royalty-free license with right of sublicense to the applicable intellectual
property rights to the extent it is legally permitted to do so and subject to
ABGENIX's agreement to be bound by and perform all the obligations of CG under
any such agreement.
6. Registration Rights; Legend.
6.1 Registration Rights.
6.1.1 Request for Registration.
(a) If ABGENIX shall receive, at any time after six months
following the initial public offering of Common Stock of ABGENIX (other than
pursuant to a registration statement
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relating either to the sale of securities to employees of ABGENIX pursuant to a
stock option, stock purchase or similar plan or an SEC Rule 145 transaction), a
written request from CG, that ABGENIX file an underwritten registration
statement under the Securities Act covering the registration of at least five
percent of the Registrable Securities held by CG (a "Demand Registration"),
ABGENIX shall, subject to the limitations set forth below, as soon as
practicable, use its reasonable best efforts to effect such registration under
the Securities Act. "Registrable Securities" shall mean all Common Stock of
ABGENIX issued or issuable upon conversion of the Series A Senior Convertible
Preferred Stock, Series 1 Subordinated Convertible Preferred Stock and the Note,
including Common Stock issued pursuant to stock splits, stock dividends and
similar distributions with respect to such shares.
(b) The underwriter shall be selected by CG but shall be
reasonably acceptable to ABGENIX. CG (together with ABGENIX) shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting.
(c) In addition, ABGENIX shall not be obligated to effect,
or to take any action to effect, any registration:
(1) Within 90 days after the effective date of any
registration statement effected by ABGENIX, whether for its own Account or for
the account of others; or
(2) On Form S-1 (or any comparable or successor form to
such form) after ABGENIX has effected one
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Demand Registration and such registration has been declared or ordered
effective. CG shall nevertheless have the continuing right to additional
registrations on Form S-3 (or any comparable successor form to such form) even
though it has already had an effective Demand Registration so long as the gross
proceeds of the offering are expected to be at least $500,000. Registrations on
Form S-3 need not be underwritten.
(d) ABGENIX shall use its reasonable best efforts to
register and qualify the securities covered by any such registration statement
under such other securities or Blue Sky laws of such jurisdictions in the United
States as shall be reasonably requested by CG; provided that ABGENIX shall not
be required in connection therewith or as a condition thereto to qualify to-do
business or to file a general consent to services of process in any such states
or jurisdictions, unless ABGENIX is already subject to service in such
jurisdiction and except as may be required by the Securities Act.
(e) ABGENIX shall cause all such securities registered
pursuant to any such registration to be listed on each U.S. securities exchange
or quotation system on which similar securities issued by ABGENIX are then
listed.
6.1.2 Piggyback Registration.
(a) In the event ABGENIX decides to register any of its
Common Stock (either for its own account or the account of a security holder or
holders exercising their respective demand registration rights) on a form that
would be suitable for a registration involving solely Common Stock held by CG,
ABGENIX will promptly give CG written notice thereof (which
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shall include a list of the jurisdictions in which ABGENIX intends to attempt to
qualify such securities under the applicable Blue Sky or other state securities
laws). Upon the written request of CG delivered to ABGENIX within 14 days after
delivery of such written notice from ABGENIX, ABGENIX shall, subject to the
limitations set forth below, include in such registration, all Registrable
Securities (as defined above) that CG has requested to be so registered.
(b) If the registration of which ABGENIX gives notice is for
a registered public offering involving an underwriting, ABGENIX shall so advise
CG as a part of the written notice given pursuant to Section 6.1.2(a) above. In
such event the right of CG to registration shall be conditioned upon such
underwriting and the inclusion of the Registrable Securities in such
underwriting to the extent provided in this section. CG shall (together with
ABGENIX and the other holders distributing their securities through such
underwriting) enter into an underwriting agreement with the underwriter's
representative for such offering. CG shall have no right to participate in the
selection of the underwriters for an offering pursuant to this section.
(c) In the event the underwriter's representative advises CG
in writing that market factors (including, without limitation, the aggregate
number of shares of Common Stock requested to be registered, the general
condition of the market, and the status of the persons proposing to sell
securities pursuant to the registration require a limitation of
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the number of shares to be underwritten, the underwriter's representative may:
(1) in the case of ABGENIX's initial public offering,
exclude some or all Registrable Securities from such registration and
underwriting; and
(2) in the case of any registered public offering
subsequent to ABGENIX's initial public offering, limit the number of shares of
Registrable Securities to be included in such registration and underwriting;
provided, however, that the total number of shares of Registrable Securities CG
to be included in such registration shall not be less than one-third of the
total number of shares included in such registration. In such event, the
underwriter's representative shall so advise CG and the number of shares of
Registrable Securities that may be included in the registration and underwriting
(if any) shall be allocated (consistent with the preceding sentence) as follows:
among CG and holders of other securities requesting and legally entitled to
include shares of Common Stock in such registrations, in proportion, as nearly
as practicable, to the respective amounts of securities (including Registrable
Securities) requesting and entitled to inclusion in such registration held by CG
and such other holders at the time of filing of the registration statement. No
Registrable Securities or other securities excluded from the underwriting by
reason of this section shall be included in such registration statement.
(3) If CG disapproves of the terms of any such
underwriting, CG may elect to withdraw therefrom by
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written notice to ABGENIX and the underwriter delivered at least seven days
prior to the effective date of the registration statement. Any Registrable
Securities or other securities excluded or withdrawn from such underwriting
shall be withdrawn from such registration.
(d) In the event of any registration of Registrable
Securities pursuant to this Section 6.1.2, ABGENIX will exercise its best
efforts to register and qualify the securities covered by the registration
statement under such other securities or Blue Sky laws of such jurisdictions as
CG shall reasonably request and as shall be reasonably appropriate for the
distribution of such securities; provided, however, that ABGENIX shall not be
required to qualify to do business or to file a general consent to service of
process in any such states or jurisdictions.
6.1.3 Expenses. All expenses incurred by ABGENIX in complying
with Section 6 of this Agreement (including, without limitation, all federal and
state registration, qualification, and filing fees, printing expenses, fees and
disbursements of counsel for ABGENIX and one special counsel for CG (if
different from counsel for ABGENIX), blue sky fees and expenses, and the expense
of any special audits incident to or required by any such registration) shall be
borne by ABGENIX; provided, nonetheless, that all such expenses incurred in
connection with any registration that is solely for the benefit of CG shall be
paid by CG. Notwithstanding the above, ABGENIX shall not be required to pay for
any expenses of any registration proceeding begun pursuant to Section 6 if the
registration request is subsequently
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withdrawn at the request of CG; provided, however, that if at the time of such
withdrawal, CG shall have learned of a material adverse event with respect to
the condition, business, or prospects of ABGENIX not known to CG at the time of
its request, then ABGENIX shall be required to pay such expenses. All
underwriting discounts and selling commissions applicable to the sale of
Registrable Securities pursuant to this Agreement shall be borne by the holders
of the securities registered pro rata on the basis of the number of shares
registered.
6.1.4 Indemnification.
(a) To the extent permitted by law, ABGENIX will indemnify
CG, each of its officers, directors and each person controlling CG, and each
underwriter, if any, and each person who controls any underwriter against all
claims, losses, damages or liabilities (or actions in respect thereof) to the
extent such claims, losses, damages or liabilities arise out of or are based
upon any untrue statement (or alleged untrue statement) of a material fact
contained in any prospectus or other document (including any related
Registration Statement) incident to any such registration, qualification or
compliance, or are based on any omission (or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by ABGENIX of the Securities Act, the
Securities Exchange Act of 1934, as amended (the "1934 Act"), or any state
securities law, or any rule or regulation promulgated under the Securities Act,
the 1934 Act or any state securities law, applicable to ABGENIX and relating to
action or inaction required
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of ABGENIX in connection with any such registration, qualification or
compliance; and ABGENIX will reimburse CG, each of its officers, directors, and
legal counsel, each such underwriter, and each person who controls CG or such
underwriter, for any legal and any other expenses reasonably incurred, as
incurred, in connection with investigating or defending any such claim, loss,
damage, liability or action; provided, however, that the indemnity contained in
this section shall not apply to amounts paid in settlement of any such claim,
loss, damage, liability or action if settlement is effected without the consent
of ABGENIX (which consent shall not unreasonably be withheld); and provided,
further, that ABGENIX will not be liable in any such case to the extent that any
such claim, loss, damage, liability or expense arises out of or is based upon
any untrue statement or omission based upon written information furnished to
ABGENIX by CG, its officers, directors, or legal counsel, underwriter, or
controlling person and stated to be specifically for use in connection with the
offering of securities of ABGENIX.
(b) To the extent permitted by law, CG will, if Registrable
Securities are included in the securities as to which such registration,
qualification or compliance is being effected pursuant to this Agreement,
indemnify ABGENIX, each of its directors and officers, each underwriter, if any,
of ABGENIX's securities covered by such a registration statement, each person
who controls ABGENIX or such underwriter within the meaning of the Securities
Act, against all claims, losses, damages and liabilities (or actions in respect
thereof) arising out of or based upon any untrue statement (or alleged untrue
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statement) of a material fact contained in any such registration statement,
prospectus, offering circular or other document (including any related
registration statement) incident to any such registration, qualification or
compliance, or any omission (or alleged omission) to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or any violation by CG of the Securities Act, the 1934 Act or
any state securities law, or any rule or regulation promulgated under the
Securities Act, the 1934 Act or any state securities law, applicable to CG and
relating to action or inaction required of CG in connection with any such
registration, qualification or compliance; and will reimburse ABGENIX, such
directors, officers, partners, persons, law and accounting firms, underwriters
or control persons for any legal and any other expenses reasonably incurred, as
incurred, in connection with investigating or defending any such claim, loss,
damage, liability or action, in each case to the extent, but only to the extent,
that such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, prospectus, offering circular
or other document in reliance upon and in conformity with written information
furnished to ABGENIX by CG and stated to be specifically for use in connection
with the offering of securities of ABGENIX, provided, however, that CG's
liability under this section shall not exceed CG's proceeds from the offering of
securities made in connection with such registration; and provided, further,
that the indemnity contained in this section shall not apply to amounts paid in
settlement of any such claim, loss, damage,
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liability or action if settlement is effected without the consent of CG (which
consent shall not unreasonably be withheld).
(c) Promptly after receipt by an indemnified party under
this section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this section, notify the indemnifying party in writing of the commencement
thereof and generally summarize such action. The indemnifying party shall have
the right to participate in and to assume the defense of such claim, jointly
with any other indemnifying party similarly noticed; provided, however, that the
indemnifying party shall be entitled to select counsel for the defense of such
claim with the approval of any parties entitled to indemnification, which
approval shall not be unreasonably withheld; provided further, however, that if
either party reasonably determines that there may be a conflict between the
position of ABGENIX and CG in conducting the defense of such action, suit or
proceeding by reason of recognized claims for indemnity under this section, then
counsel for such party shall be entitled to conduct the defense to the extent
reasonably determined by such counsel to be necessary to protect the interest of
such party. The failure to notify an indemnifying party promptly of the
commencement of any such action, if prejudicial to the ability of the
indemnifying party to defend such action, shall relieve such indemnifying party,
to the extent so prejudiced, of any liability to the indemnified party under
this section, but the omission so to notify the indemnifying party will not
relieve such party of any liability that such
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party may have to any indemnified party otherwise other than under this Section
6.1.4.
6.1.5 Limitations on Registration Rights Granted to Other
Security Holders. ABGENIX shall not enter into any; agreement with any holder or
prospective holder of any securities of ABGENIX providing for the granting to
such holder of any registration rights, except that, with the consent of
ABGENIX, additional holders of ABGENIX securities may be granted registration
rights on a pari passu basis with CG with regard to any or all securities of
ABGENIX held by them.
6.1.6 Transfer of Rights. The registration rights granted by
ABGENIX to CG under this Agreement may be assigned to a transferee or assignee
of at least 250,000 shares of Common Stock, Series A Senior Convertible
Preferred Stock or Series 1 Subordinated Convertible Preferred Stock of ABGENIX
held by CG, including shares issued pursuant to stock splits, stock dividends
and similar distributions with respect to such shares, other than shares that
are sold to the public; provided that (a) ABGENIX is given written notice of
such transfer or assignment, stating the name and address of the transferee or
assignee and identifying the securities with respect to which such registration
rights are being assigned, and (b) the transferee or assignee of such rights is
not a person deemed by the Board of Directors of ABGENIX, in its best judgment,
to be a competitor of ABGENIX.
6.2 Legend. Each certificate representing (i) the Preferred Stock and
(ii) any other securities issued in respect of the Preferred Stock or upon any
stock split, stock dividend,
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recapitalization, merger, conversion, consolidation or similar event relating to
the Preferred Stock, shall be stamped or otherwise imprinted with a legend in
the following form (in addition to any legend or legends required under
applicable state securities laws):
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
DISTRIBUTION THEREOF, AND HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE COMPANY
RECEIVES AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY
STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT."
7. Inventions.
It is contemplated that the parties may continue to share facilities
for a period of six months after the Closing, and possibly longer by mutual
agreement. During such time employees of CG and ABGENIX may continue to exchange
ideas and concepts. Accordingly, the parties agree that:
(a) Any inventions made solely by CG employees shall be the property
of CG and any inventions made solely by employees of ABGENIX shall be the
property of ABGENIX, and the respective owner shall be responsible for filing,
prosecuting, maintaining, enforcing and defending any patent applications or
issued patents with respect thereto.
(b) Any inventions made jointly by employees of CG and employees of
ABGENIX shall be jointly owned by the parties, and the parties shall mutually
agree on how to share the responsibility and expense of filing, prosecuting,
maintaining,
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enforcing and defending any patent applications or issued patents with respect
thereto.
(c) Notwithstanding the foregoing, CG hereby agrees to grant to
ABGENIX an exclusive, worldwide, royalty-free license with right to sublicense
to practice in the Antibody Business CG's rights to any such jointly-owned
invention, whether or not patented, that is made during the period that the
parties jointly share facilities under the Services Agreement and for six months
thereafter, and ABGENIX hereby agrees to grant to CG an exclusive, worldwide,
royalty-free license with right of sublicense to practice outside the Antibody
Business ABGENIX's rights to any such jointly owned invention, whether or not
patented, that is made during the period of joint sharing of facilities under
the Services Agreement and for six months thereafter.
8. Certain Particular Agreements of CG and ABGENIX.
8.1 Except as expressly provided herein, ABGENIX and CG agree that
thereafter, the receiving party shall keep completely confidential and shall not
publish or otherwise disclose and shall not use for any purpose any information
furnished to it by the other party pursuant to this Agreement (including,
without limitation, know-how), except to the extent that it can be established
by the receiving party by competent proof that such information:
(a) was already known to the receiving party, other than under an
obligation of confidentiality, at the time of disclosure; provided, however,
that this exception shall not
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apply to information assigned or licensed exclusively by it to the other
hereunder;
(b) was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving party;
(c) became generally available to the public or otherwise part of the
public domain after its disclosure and other than through any act or omission of
the receiving party in breach of this Agreement;
(d) was subsequently lawfully disclosed to the receiving party by a
person other than the disclosing party; or
(e) was developed by the receiving party without reference to any
information or materials disclosed by the disclosing party.
Notwithstanding the foregoing, a party hereto may nevertheless
disclose the other party's information to the extent such disclosure is
reasonably necessary in filing or prosecuting patent applications, prosecuting
or defending litigation, complying with applicable governmental regulations or
otherwise submitting information to tax or other governmental authorities,
making a permitted sublicense or other exercise of its rights hereunder or
conducting clinical trials, provided that if a party is required to make any
such disclosure of another party's secret or confidential information, other
than pursuant to a confidentiality agreement, it will give reasonable advance
notice to the other party of such disclosure requirement and, save to the extent
inappropriate in the case of patent applications, will use efforts consistent
with prudent business judgment to secure
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26
confidential treatment of such information prior to its disclosure (whether
through protective orders or confidentiality agreements or otherwise).
8.2 Effective at the Closing, ABGENIX assumes and agrees to discharge
when due all obligations of the Business, including without limitation all
obligations of CG under the agreements, contracts and other obligations
transferred under this Agreement. In addition, effective at the Closing, ABGENIX
agrees to assume liability for the accrued vacation time of those CG employees
transferred to ABGENIX.
8.3 To the extent permitted by law, ABGENIX shall indemnify CG, each
of its officers, directors, agents, and each person controlling CG, if any,
against all claims, losses, damages or liabilities (or actions in respect
thereof) to the extent such claims, losses, damages or liabilities arise out of
or are based upon (a) the breach or alleged breach by ABGENIX of any agreement,
contract or other obligation transferred to ABGENIX under this Agreement, (b)
claims relating to products manufactured and/or sold by or through ABGENIX, (c)
claims made by persons who immediately prior to the Closing were employees of CG
and who immediately after the Closing become employees of ABGENIX, and (d)
operation of the Business after the Closing; and ABGENIX agrees to reimburse
each indemnified person for any legal and other expenses reasonably incurred, as
incurred, in connection with investigating or defending any such claim, loss,
damage, liability or action; provided, that the indemnity contained in this
section shall not apply to amounts paid in settlement of any such claim, loss,
damage, liability or action
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if settlement is effected without the consent of ABGENIX (which consent shall
not unreasonably be withheld); and provided, further, that the indemnity
contained in this section shall not apply to any amounts covered by CG's
insurance.
8.4 Right of First Refusal.
(a) ABGENIX hereby grants to CG the right of first refusal to purchase
up to its Pro Rata Share of New Securities (as defined below) which ABGENIX may,
from time to time, propose to sell and issue so long as CG's Pro Rata Share is
at least fifty percent. CG may purchase said New Securities on the same terms
and at the same price at which ABGENIX proposes to sell the New Securities. The
"Pro Rata Share" of CG for purposes of this right of first refusal, is the ratio
of (i) the total number of shares of Common Stock held by CG (including any
shares of Common Stock into which shares of any convertible securities held by
CG are convertible) to (ii) the total number of shares of Common Stock and
Common Stock options outstanding immediately prior to the issuance of the New
Securities (including any shares of Common Stock into which outstanding shares
of convertible securities are convertible).
(b) "New Securities" shall mean any capital stock of ABGENIX, whether
authorized or not, and any rights, options, or warrants to purchase said capital
stock, and securities of any type whatsoever that are, or may become,
convertible into said capital stock; provided that "New Securities" does not
include (i) convertible securities issued by ABGENIX in the first private
financing concluded within one year after the date of this Agreement; (ii)
securities offered pursuant to a registration
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statement filed under the Securities Act; (iii) securities issued pursuant to
the acquisition of another corporation by ABGENIX by merger, purchase of
substantially all of the assets, or other reorganization, if approved by
ABGENIX's Board of Directors; (iv) shares issued or issuable to employees
pursuant to a plan or arrangement approved by ABGENIX's Board of Directors
(except to the extent that such shares would cause an adjustment to the
conversion rate of any of ABGENIX's convertible securities); (v) shares issued
without consideration pursuant to a stock dividend, stock split, or similar
transaction; and (vi) warrants, and shares issuable upon exercise of such
warrants, issued in connection with equipment leasing or facility financing
transactions approved by ABGENIX's Board of Directors.
(c) In the event ABGENIX proposes to undertake an issuance of New
Securities, it shall give CG written notice (the "Notice") of its intention,
describing the type of New Securities, the price, the terms upon which ABGENIX
proposes to issue the same the number of shares which CG is entitled to
purchase, and a statement that CG shall have 20 days to respond to such Notice.
CG shall have 20 days from the date of receipt of the Notice to agree to
purchase any or all of its Pro Rata Share of the New Securities for the price
and upon the terms specified in the Notice by giving written notice to ABGENIX
and stating therein the quantity of New Securities to be purchased and
forwarding payment for such New Securities to the Company if immediate payment
is required by such terms.
(d) In the event that CG fails to exercise in full the right of first
refusal within said 20 day period, ABGENIX shall
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29
have 90 days thereafter to sell or enter into an agreement (pursuant to which
the sale of New Securities covered thereby shall, be closed, if at all, within
60 days from date of said agreement) to sell the New Securities respecting which
CG's rights were not exercised, at a price and upon general terms no more
favorable to the purchaser thereof than specified in the Notice. In the event
ABGENIX has not sold the New Securities within said 90 day period (or sold and
issued New Securities in accordance with the foregoing within 60 days from the
date of said agreement), ABGENIX shall not thereafter issue or sell any New
Securities without first offering such securities to CG in the manner provided
above.
(e) The right of first refusal granted under this Section 8.4 shall
expire upon:
(i) The effective date of a Registration Statement filed by
ABGENIX in connection with a bona fide firm commitment underwritten public
offering of ABGENIX's Common Stock; or
(ii) The registration of ABGENIX's Common Stock under the 1934
Act.
(f) The right of first refusal granted under this Section 8.3 is
assignable by CG to any transferee of a minimum of 250,000 shares of Common
Stock (including any shares of Common Stock into which shares of convertible
securities then held by it are convertible).
8.5 Notwithstanding any other provisions of this Agreement, neither
party shall be required to take any action hereunder if such action would
constitute a breach of any
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contract to which it is a party, including without limitation the MRLOA.
9. GenPharm Litigation.
ABGENIX agrees to cooperate with CG in connection with the pending
litigation between CG and GenPharm International, Inc., styled as Cell Genesys,
Inc. v. GenPharm International, Inc. and Related Cross-Action (Santa ▇▇▇▇▇
Superior Court Case No. CV 738041) and GenPharm International, Inc. v. Japan
Tobacco, Inc., et al. (N. Dist. California Federal District Court Case No. C
96-0487 CW) (collectively the "GenPharm Litigation"). Without limiting the
foregoing, ABGENIX shall (a) identify, designate and make ABGENIX employees and
consultants available to serve as witnesses to testify on behalf of CG for
corporate depositions; (b) assist litigation counsel to comply with CG's
discovery obligations, including, without limitation, responding to written
discovery requests; and (c) perform such other ministerial and administrative
functions that may be necessary and appropriate to ensure that the GenPharm
Litigation is prosecuted and/or defended as efficiently as possible to obtain
results most favorable to CG under the circumstances. All out-of-pocket expenses
(i.e., expenses paid to third parties, other than compensation paid to ABGENIX
employees) incurred by ABGENIX in the performance of the foregoing obligations
shall be paid or reimbursed by CG and CG shall be solely responsible for the
payment of any settlement, judgment and costs incurred in the GenPharm
litigation.
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31
10. Miscellaneous.
10.1 Entire Agreement. This Agreement, together with the Transaction
Agreements, constitutes the entire understanding of the parties with respect to
the matters provided for herein and supersedes any previous agreements and
understanding between the parties with respect to the subject matter hereof and
thereof. No amendment, modification or alteration of the terms or provisions of
this Agreement shall be binding unless the same shall be in writing and duly
executed by the party against whom such amendment, modification or alteration is
asserted.
10.2 Assignment. Except as set forth in Sections 6 and 8.3(d), neither
party shall delegate duties of performance or in whole or in part, rights or
obligations under this without the prior written consent of the other party,
except either party may assign this Agreement without such consent to an entity
that acquires all or substantially all of the assets or business of such party,
whether by sale, merger or otherwise. The terms and conditions of this Agreement
shall be binding on and inure to benefit of the permitted successors and Assigns
of the parties.
10.3 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.
10.4 Headings. The headings of this Agreement are included for
convenience only and shall not be deemed to constitute part of this Agreement or
to affect the construction hereof.
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32
10.5 Modifications and Waivers. Any of the terms or conditions of this
Agreement may be waived in writing at any time by the party which is entitled to
the benefits thereof. No waiver of any of the provisions of this Agreement shall
be deemed to or shall constitute a waiver of any other provisions hereof
(whether or not similar) or of the same provision in respect of a subsequent
event.
10.6 Notices. All notices required or permitted to be given under this
Agreement shall be in writing and shall be sent by facsimile transmission or
mailed by registered or certified mail addressed to the party to whom such
notice is required or permitted to be given. All notices shall be deemed to have
been given when transmitted if given by facsimile and confirmation of receipt is
received or, if mailed, forty-eight hours after mailed as evidenced by the
postmark at the point of mailing.
All notices to CG shall be addressed as follows:
Cell Genesys, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
All notices to ABGENIX shall be addressed as follows:
Abgenix, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Either party may, by written notice to the other, designate a new address or
number to which notices to the party giving the notice shall thereafter be
mailed or sent.
10.7 Governing Law. This Agreement shall be construed in accordance
with and governed by the laws of the State of
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California applicable to agreements made and to be performed in such
jurisdiction.
10.8 Further Action. At any time or from time to time after the date
hereof, either party shall, at the request of the other party and at such other
party's expense, execute and deliver any further instruments or documents and
take all such further action as such party reasonably may request in order to
consummate and make effective the transaction contemplated by this Agreement.
10.9 Severability. If any provisions hereof shall be held by any court
of competent jurisdiction to be illegal, void or unenforceable, such provision
shall be thereafter amended by the parties hereto such that it is thereafter
legal, valid and enforceable and gives effect to the intention of the parties,
but in any event the illegality or unenforceability of such provision shall have
no effect upon and shall not impair the enforceability of any other provision of
this Agreement.
10.10 No Third-Party Beneficiaries. The provisions of this Agreement
are for the sole benefit of the parties of this Agreement and are not for the
benefit of any third party.
10.11 Disputes. If disagreement should arise between the parties with
respect to any provision of this Agreement or the Transaction Agreements, the
parties will use reasonable efforts to resolve such dispute through mediation.
If the parties are unable to do so within 60 days, either party may submit the
matter to binding arbitration before a panel of three arbitrators in accordance
with the Commercial Arbitration Rules of the American Arbitration Association.
Any such arbitration
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shall be completed within 180 days following the date a party submits such
matter to arbitration. No punitive damages may be awarded in any such
arbitration, and enforcement of any award may be made by any court having
jurisdiction over the parties.
IN WITNESS WHEREOF, the undersigned have caused this Stock Purchase
and Transfer Agreement to be executed as of the date first above written.
CELL GENESYS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President and Chief Executive Officer
ABGENIX, Inc.
By: /s/ R. ▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
R. ▇▇▇▇▇ ▇▇▇▇▇
President and Chief Executive Officer
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35
Exhibit List
EXHIBIT A-1 ABGENIX Biological Materials
EXHIBIT A-2 CG Biological Materials
EXHIBIT A-3 Joint Biological Materials
EXHIBIT B Patents and Patent Applications
EXHIBIT C Services Agreement
EXHIBIT D Immunization Services Agreement
EXHIBIT E Governance Agreement
EXHIBIT F Tax Sharing Agreement
EXHIBIT G Gene Therapy Rights Agreement
EXHIBIT H Voting Agreement
EXHIBIT I Convertible Promissory Note
EXHIBIT J Patent Assignment Agreement
EXHIBIT K Certificate of Designations
EXHIBIT L Certificate of Incorporation
EXHIBIT M Bylaws
EXHIBIT N Employee Notes
EXHIBIT 0 Equipment, Furniture and Fixtures
EXHIBIT P Antibody Business Agreements
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36
Exhibit A-1
ABGENIX Biological Materials
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
37
Exhibit A-1
ABGENIX Biological Materials
(CONTINUED)
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
38
Exhibit A-1
ABGENIX Biological Materials
(CONTINUED)
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
39
Exhibit A-1
ABGENIX Biological Materials
(CONTINUED)
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
40
Exhibit A-2
CG Biological Materials
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
41
Exhibit A-3
Joint Biological Materials
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
42
Exhibit B
DOCKET NO. FILING DATE SERIAL NO. TITLE INVENTORS
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
43
Exhibit B
(CONTINUED)
DOCKET NO. FILING DATE SERIAL NO. TITLE INVENTORS
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
44
Exhibit C
Services Agreement
[OMITTED]
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45
Exhibit D
Immunization Services Agreement
[OMITTED]
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46
Exhibit E
Governance Agreement
[OMITTED -- SEE EXHIBIT 10.15]
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47
Exhibit F
Tax Sharing Agreement
[OMITTED -- SEE EXHIBIT 10.16]
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48
Exhibit G
Gene Therapy Rights Agreement
[OMITTED -- SEE EXHIBIT 10.17]
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49
Exhibit H
Voting Agreement
[OMITTED]
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50
Exhibit I
Convertible Promissory Note
[OMITTED]
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51
Exhibit J
Patent Assignment Agreement
[OMITTED - SEE EXHIBIT 10.18]
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52
Exhibit K
Certificate of Designations
[OMITTED -- SEE EXHIBIT 3.2]
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53
Exhibit L
Certificate of Incorporation
[OMITTED -- SEE EXHIBIT 3.1]
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54
Exhibit M
By Laws
[OMITTED -- SEE EXHIBIT 3.4]
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55
Exhibit N
Employee Notes
None.
-49-
56
Exhibit 0
Equipment, Furniture and Fixtures and Lease Obligations Assumed
[OMITTED]
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57
Exhibit P
Antibody Business Agreements
[***]
[***] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
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