EXHIBIT 10.2
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement is dated as of May 3, 2000 (this
"Agreement"), between Kos Pharmaceuticals, Inc., a Florida corporation (the
"Company"), and DuPont Pharmaceuticals Company, a Delaware general partnership
("Purchaser").
A. The Company and Purchaser have entered into that certain
Copromotion and Future Development Agreement dated the date
hereof (the "Copromotion Agreement") relating to the
copromotion of the Company's Product (as defined in the
Copromotion Agreement).
B. In connection with, and as a condition of the Company and
Purchaser entering into, the Copromotion Agreement, the
Company desires to sell to Purchaser, and Purchaser desires to
purchase from the Company, shares of the Company's common
stock, par value $.01 per share (the "Common Stock"), on the
terms and subject to the conditions set forth in this
Agreement.
C. In connection with, and as a condition of the Company and
Purchaser entering into, the Copromotion Agreement, the
Company desires to grant Purchaser the option to purchase from
the Company certain additional shares of the Company's Common
Stock, on the terms and subject to the conditions set forth in
this Agreement.
D. In connection with, and as a condition of the Company and
Purchaser entering into, the Copromotion Agreement and this
Agreement, the Company and Purchaser intend to enter into that
certain Registration Rights Agreement (the "Registration
Rights Agreement").
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound, the parties agree as follows:
Article 1
Purchase and Sale of Common Stock
1.1 Purchase and Sale of the Shares. Subject to the terms and
conditions hereof, the Company hereby agrees to issue and sell to Purchaser, and
Purchaser hereby agrees to purchase from the Company at the Closing (as
hereinafter defined), 1,250,000 shares of the Company's Common Stock (the
"Shares") at a purchase price of $16.00 per share, for an aggregate purchase
price for the Shares of $20,000,000 (the "Purchase Price"). The number of Shares
was determined by dividing (i) the Purchase Price by (ii) the average closing
price of a share of Common Stock as quoted on the Nasdaq National Market for the
sixty consecutive trading days immediately preceding the date of this Agreement
(rounded up to the nearest whole dollar).
1.2 Purchase of Additional Shares.
(a) Subject to the terms and conditions hereof, upon the
Company's receipt from the U.S. Food and Drug Administration (the "FDA") of
marketing clearance for the Product (the "Additional Closing Event"), the
Company hereby agrees to issue and sell to Purchaser, and Purchaser hereby
agrees to purchase from the Company at the Additional Closing (as hereinafter
defined), the number of shares of Common Stock (the "Additional Shares")
determined by dividing (i) $5,000,000 by (ii) the average closing price of a
share of Common Stock as quoted on the Nasdaq National Market (or such other
exchange or market on which the Company's Common Stock is then traded) for the
sixty consecutive trading days which immediately precede the date of the
Additional Closing Event, at such price per share, for an aggregate purchase
price for the Additional Shares of $5,000,000 (the "Additional Shares Purchase
Price").
(b) The Company shall provide Purchaser with written notice
(the "Additional Closing Event Notice") of the occurrence of the Additional
Closing Event within 3 business days of the occurrence thereof.
(c) In the event that, prior to issuance and sale of the
Additional Shares, there shall be an increase or decrease in the number of
issued shares of Common Stock of the Company as a result of a subdivision,
split, reclassification, consolidation of shares or the like, the number of
Additional Shares shall be adjusted so that the adjusted number of such shares
shall be the substantial equivalent of the number of Additional Shares prior to
such change.
1.3 Option Shares.
(a) Subject to the terms and conditions hereof, upon the
occurrence of the Additional Closing Event, the Company hereby grants to
Purchaser the option (the "Option"), exercisable in whole or in part at
Purchaser's sole discretion, to purchase up to a number of shares of the Common
Stock determined by dividing (i) $5,000,000 by (ii) the average of the high and
low trading prices of a share of Common Stock as quoted on the Nasdaq National
Market on the date of the Additional Closing Event (the "Option Shares") at such
price per share, for an aggregate purchase price for the Option Shares of up to
$5,000,000 (the "Option Shares Purchase Price").
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(b) The Option, or any portion of the Option, shall be
exercised by Purchaser only in accordance with the provisions of this Agreement.
Purchaser shall give to the Company a written notice (the "Exercise Notice") on
or before 5:00 p.m. (Miami time) on the 90th day following the Additional
Closing Event that shall: (i) state the number of Option Shares with respect to
which the Option is being exercised; and (ii) specify a date (other than a
Saturday, Sunday or legal holiday) not less than five nor more than ten days
after the date of such written notice, as the date on which the Option Shares
will be purchased (the "Option Closing Date").
(c) In the event that, prior to issuance and sale of the
Option Shares, there shall be an increase or decrease in the number of issued
shares of Common Stock of the Company as a result of a subdivision, split,
reclassification, consolidation of shares or the like, the number of Option
Shares shall be adjusted so that the adjusted number of such shares shall be the
substantial equivalent of the number of Option Shares prior to such change.
1.4 Closings.
(a) The closing of the issuance and sale of the Shares (the
"Closing") shall take place at the offices of Holland & Knight LLP, ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ at 10:00 a.m. (Miami time) on the date three
business days following the satisfaction or waiver of all of the conditions
precedent to the Closing set forth in Section 5.1 (the "Closing Date"), or at
such other place, date and time as may be mutually agreed upon by the Company
and Purchaser. As payment in full for the Shares being purchased by it at the
Closing, Purchaser shall pay to the Company the Purchase Price by wire transfer.
Upon the Purchaser's purchase of the Shares at the Closing, the Company shall
issue and deliver to Purchaser a stock certificate or certificates in definitive
form, registered in the name of Purchaser, representing the number of Shares
purchased at the Closing.
(b) Subject to the terms of Section 1.2 and Article 5, the
closing of the sale and purchase of the Additional Shares under this Agreement
(the "Additional Closing") shall be held on the date specified by the Company
and Purchaser within 10 days after the delivery of the Additional Closing Event
Notice (the "Additional Closing Date") at the offices of Holland & Knight LLP,
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ at 10:00 a.m. (Miami time), or at such
time and place as the Company and Purchaser may agree. As payment in full for
the Additional Shares being purchased by it at the Additional Closing, Purchaser
shall pay to the Company the Additional Shares Purchase Price by wire transfer.
Upon the Purchaser's purchase of the Additional Shares at the Additional
Closing, the Company shall issue and deliver to Purchaser a stock certificate or
certificates in definitive form, registered in the name of Purchaser,
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representing the number of Additional Shares purchased at the Additional
Closing.
(c) Subject to the terms of Section 1.3 and Article 5, the
closing of the sale and purchase of the Option Shares under this Agreement (the
"Option Closing") shall be held on the Option Closing Date at the offices of
Holland & Knight LLP, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ at 10:00 a.m.
(Miami time), or at such time and place as the Company and Purchaser may agree.
As payment in full for the Option Shares being purchased by it at the Option
Closing, Purchaser shall pay to the Company the Option Shares Purchase Price by
wire transfer. Upon the Purchaser's purchase of the Option Shares at the Option
Closing, the Company shall issue and deliver to Purchaser a stock certificate or
certificates in definitive form, registered in the name of Purchaser,
representing the number of Option Shares purchased at the Option Closing.
Article 2
Additional Agreements
2.1 Standstill. Notwithstanding any other provision of this Agreement,
without the written consent of the Company, neither Purchaser nor any business
entity that directly, or indirectly through one or more intermediaries, controls
or is controlled by, or is under common control with, Purchaser (its
"Affiliates") will acquire beneficial ownership (which term shall include for
the purposes of this Agreement, without limitation, direct or indirect ownership
or any direct or indirect ability to influence voting in any manner, singly or
as part of a partnership, limited partnership, syndicate or other "Group"
(within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) of any securities of the Company entitled to
vote with respect to the election of any directors of the Company ("Voting
Securities"), any security convertible into, exchangeable for or exercisable for
or that may become any Voting Securities or any other right to acquire Voting
Securities, other than the Shares, the Additional Shares, the Option Shares or
shares of the Company's capital stock issuable in respect thereof, including as
a result of a dividend, subdivision, split, reclassification, consolidation of
shares or the like.
2.2 Acts in Concert with Others; Agreement not to Control. Neither
Purchaser nor its Affiliates shall join a partnership, limited partnership,
syndicate or other group, or otherwise act in concert with any third person, for
the purpose of acquiring, holding, voting or disposing of Voting Securities.
2.3 Restriction on Transfer of Voting Securities. Notwithstanding any
other provision of this Agreement (including, without limitation, the provisions
of Section 2.4), neither Purchaser nor its Affiliates shall dispose of
beneficial
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ownership or voting control of any of the Shares or any right thereto (or any
securities issuable in respect thereof) ("Transfer"), except as follows: (i)
375,000 Shares may be Transferred commencing on the date the Company receives
from the FDA marketing clearance for the Product; (ii) 375,000 Shares may be
Transferred commencing on the one year anniversary of the date the Company
receives from the FDA marketing clearance for the Product; (iii) 500,000 Shares
may be Transferred commencing on the date five years from the date hereof; (iv)
the Additional Shares may be Transferred commencing on the date five years from
the date hereof; (v) one-half of the Option Shares actually purchased by
Purchaser under this Agreement may be Transferred commencing on the one year
anniversary of the Option Closing Date; and (vi) one-half of the Option Shares
actually purchased by Purchaser under this Agreement may be Transferred
commencing on the date five years from the date hereof. In the event that there
shall be an increase or decrease in the number of issued shares of Common Stock
of the Company as a result of a subdivision, split, reclassification,
consolidation of shares or the like, the number of Shares, Additional Shares and
Option Shares in the preceding sentence shall be adjusted, as appropriate, so
that the adjusted number of such shares shall be the substantial equivalent of
the number of such Shares, Additional Shares or Option Shares prior to such
change.
2.4 Right of First Refusal. If Purchaser or any of its Affiliates
desires to dispose of beneficial ownership of any or all of the Voting
Securities beneficially owned by Purchaser or such Affiliate (the "Offered
Stock"), Purchaser or such Affiliate shall first give written notice (a
"Transfer Notice") thereof to the Company, identifying whether the transaction
will occur on the open market or as a private transaction and the number of
Voting Securities sought to be transferred. If the transaction is to be a
private transaction, the Transfer Notice shall also identify the proposed
transferee, the proposed purchase price (the "Offered Price"), if applicable,
the terms of the proposed transaction including the proposed transaction date
and a copy of any written offer or other writing setting forth the terms and
conditions of the proposed transaction. Such Transfer Notice shall constitute an
irrevocable offer by Purchaser or such Affiliate to sell all of the Offered
Stock to the Company at the market price at the close of trading on the day the
offer is accepted in writing by the Company or, if a private transaction is
proposed, at the Offered Price and upon the same terms and conditions as
Purchaser or such Affiliate is willing to dispose the Offered Stock to the
proposed transferee. If a private transaction is proposed, to the extent the
consideration proposed to be paid by the proposed transferee consists of
property other than cash, the reasonable cash equivalent of such property, and
the manner of determining the same, shall be stated in such Transfer Notice.
Once given, a Transfer Notice may not be modified or amended except with the
written consent of the Company. Within the five (5) business day period, or if a
private transaction is proposed within the twenty-one (21) day period, following
the giving of the Transfer Notice (the "Offer Period"), the Company may elect,
by giving written notice of such election to
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Purchaser or such Affiliate, to purchase all but not less than all of the
Offered Stock. If the Company does not elect, by notice in writing given to
Purchaser or such Affiliate within the Offer Period, to purchase all (but not
less than all) of the Offered Stock, then Purchaser or such Affiliate shall be
free to dispose of all of the Offered Stock, if on the open market, within 180
days of the end of the Offer Period, or, if a private transaction is proposed,
within 90 days of the end of the Offer Period to the original proposed
transferee at a price not lower than the Offered Price and upon the terms
stipulated in the Transfer Notice in all material respects. If such Offered
Stock is not so disposed of by Purchaser or such Affiliate within such 180 or 90
day period, Purchaser or such Affiliate shall continue to hold the Voting
Securities subject to all of the terms and conditions of this Agreement and may
not sell any Voting Securities without again complying with all of the
provisions hereof.
2.5 Approvals and Consents; Cooperation.
(a) The Company and Purchaser shall cooperate with each other
and use (and shall cause their respective Subsidiaries to use) their respective
commercially reasonable best efforts to take or cause to be taken all actions,
and do or cause to be done all things, necessary, proper or advisable under this
Agreement and applicable Laws to consummate and make effective the sale of the
Shares, the Additional Shares and the Option Shares (the "Sale") and the other
transactions contemplated by this Agreement as soon as practicable, including
preparing and filing as promptly as practicable all documentation to effect all
necessary applications, notices, petitions, filings and other documents and to
obtain as promptly as practicable all permits, consents, approvals and
authorizations necessary or advisable to be obtained from any third party and/or
any Governmental Entity (as defined in Section 3.6) in order to consummate the
Sale or any of the other transactions contemplated by this Agreement.
(b) In particular, the Company and Purchaser each agree to use
commercially reasonable efforts to take, or cause to be taken, all appropriate
action, and do, or cause to be done, such things as may be necessary under
federal or state securities laws or the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1976, as amended (the "HSR Act") applicable to or necessary for, and will
file as soon as reasonably practicable and, if appropriate, use commercially
reasonable efforts to have declared effective or approved, all documents and
notifications with the Securities and Exchange Commission (the "SEC") and other
governmental or regulatory bodies that they deem necessary or appropriate for,
the consummation of the Sale or any of the other transactions contemplated
hereby and each party shall give the other information reasonably requested by
such other party pertaining to it and its Subsidiaries to enable such other
party to take such actions.
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2.6 SEC Filings; De-registration. The Company shall use its best
efforts to make all required filings under the Exchange Act in a timely manner.
The Company shall use its best efforts to prevent its Common Stock from being
de-registered from the Nasdaq National Market or de-registered under the
Exchange Act.
2.7 Publicity. Any press release relating to the Sale and this
Agreement shall be made in accordance with Section 11.3 of the Copromotion
Agreement.
2.8 Expenses. Whether or not the Sale is consummated, all costs and
expenses incurred in connection with this Agreement, the Sale and the other
transactions contemplated by this Agreement shall be paid by the party incurring
such expense.
2.9 Antitakeover Statutes. If any Antitakeover Statute (as defined in
Section 3.10) is or may become applicable to the Sale or the other transactions
contemplated by this Agreement, each of Purchaser and the Company and their
board of directors shall grant such approvals and take such lawful actions as
are necessary so that such transactions may be consummated as promptly as
practicable on the terms contemplated by this Agreement and otherwise act to
eliminate or minimize the effects of such statute or regulation on such
transactions.
Article 3
Representations and Warranties of the Company
The Company represents and warrants to Purchaser as of the date hereof
as follows:
3.1 Authorization of Agreements, etc. The execution and delivery by the
Company of this Agreement, the performance by the Company of its obligations
hereunder, the issuance, sale and delivery of the Shares and the issuance and
delivery of the Additional Shares and the Option Shares have been duly
authorized by all requisite corporate action and will not result in any
violation of, be in conflict with, or constitute a default under, with or
without the passage of time or the giving of notice: (a) any provision of the
Company's Articles of Incorporation, as amended, or Bylaws; (b) any provision of
any judgment, decree or order to which the Company is a party or by which it is
bound; (c) any material contract or agreement to which the Company is a party or
by which it is bound; or (d) any statute, rule or governmental regulation
applicable to the Company, except where such violation, conflict, or default
would not have a Company Material Adverse Effect (as defined in Section 3.5).
3.2 Valid Issuance of Common Stock. The Shares, the Additional Shares
and the Option Shares have been duly authorized and, when issued,
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sold and delivered in accordance with this Agreement for the consideration
expressed herein will be validly issued, fully paid and nonassessable with no
personal liability attaching to the ownership thereof and will be free and clear
of all liens, charges and encumbrances of any nature whatsoever except for
restrictions on transfer under this Agreement and under applicable Federal and
state securities laws.
3.3 Validity. This Agreement has been duly executed and delivered by
the Company and constitutes the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of
general application affecting enforcement of creditors' rights generally, (ii)
as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies, and (iii) to the extent the
indemnification provisions contained in this Agreement may be limited by
applicable Federal or state securities laws.
3.4 Capitalization. As of May 1, 2000, the authorized capital stock of
the Company consists of 50,000,000 shares of Common Stock, and 10,000,000 shares
of preferred stock, par value $.01 per share, of which 18,401,814 shares of
Common Stock are outstanding, no shares of preferred stock are outstanding, and
warrants, options or convertible securities relating to the issuance by the
Company of up to 16,183,300 shares of its Company's Common Stock are
outstanding, not including up to an aggregate of 8,000,000 options or shares of
common stock issuable under either the 1996 Kos Pharmaceuticals, Inc. Stock
Option Plan and the 1999 Kos Pharmaceuticals, Inc. Employee Stock Purchase Plan.
All of the issued and outstanding shares of the Company's Common Stock are duly
and validly issued and outstanding and are fully paid and nonassessable.
3.5 Organization, Good Standing and Qualification. Each of the Company
and each of its Subsidiaries is a corporation or limited liability company duly
organized, validly existing and in good standing (where such concept is
recognized) under the laws of its respective jurisdiction of organization. Each
of the Company and each of its Subsidiaries has all requisite corporate or
limited liability company power and authority to own and operate its respective
properties and assets and to carry on its business as presently conducted. Each
of the Company and each of its Subsidiaries is qualified to do business and is
in good standing as a foreign corporation or limited liability company in each
jurisdiction (where such concept is recognized) where the ownership or operation
of its properties or conduct of its business requires such qualification, except
where the failure to be so qualified or in such good standing, when taken
together with all other such failures, is not reasonably likely to have a
Company Material Adverse Effect (as defined below) or impair the ability of the
Company, Purchaser or any of their respective Subsidiaries, following
consummation of the Sale, to conduct any
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material business or operations in any jurisdiction where they are now being
conducted. All of the outstanding equity interests in each such Subsidiary have
been validly issued and are fully paid and non-assessable and owned by the
Company free and clear of all pledges, claims, liens, charges, encumbrances and
security interests of any kind or nature whatsoever. The Company has made
available to Purchaser a complete and correct copy of the Company's Articles of
Incorporation and Bylaws (or similar documents), each as amended to date. The
Company's Articles of Incorporation and Bylaws so made available are in full
force and effect.
As used in this Agreement, (a) "Subsidiary" means, with respect to the
Company or Purchaser, as the case may be, any entity, whether incorporated or
unincorporated, of which at least fifty percent (50%) of the securities or
ownership interests having by their terms ordinary voting power to elect fifty
percent (50%) of the board of directors or other persons performing similar
functions is directly or indirectly owned or controlled by such party or by one
or more of its respective Subsidiaries or by such party and any one or more of
its respective Subsidiaries, and (b) "Company Material Adverse Effect" means any
change in or effect on the business of the Company and its Subsidiaries that is,
or is reasonably likely to be, materially adverse to the business, operations or
assets (including intangible assets), liabilities (contingent or otherwise),
prospects, condition (financial or otherwise) of the Company and its
Subsidiaries, taken as a whole.
3.6 Governmental Filings. Other than any filings and/or notices
required pursuant to the HSR Act, federal securities laws and state securities
or "blue sky" laws, no notices or other filings are required to be made by the
Company with, nor are any consents, registrations, approvals, permits or
authorizations required to be obtained by the Company from, any governmental or
regulatory authority, agency, commission, body or other governmental entity
("Governmental Entity"), in connection with the execution and delivery of this
Agreement by the Company and the consummation by the Company of the Sale and the
other transactions contemplated hereby, except those that the failure to make or
obtain are not, individually or in the aggregate, reasonably likely to have a
Company Material Adverse Effect or prevent, materially delay or materially
impair the ability of the Company to consummate the transactions contemplated by
this Agreement.
3.7 Company Reports; Financial Statements. The Company and, to the
extent applicable, each of its then or current Subsidiaries has made all filings
required to be made by it with the SEC since December 16, 1996 (collectively,
the "Company Reports"). As of their respective dates, the Company Reports
complied in all material respects with the requirements of applicable statutes
and regulations and did not, and any Company Reports filed with the SEC prior to
the Sale will not, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or
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necessary to make the statements made therein, in light of the circumstances in
which they were made, not misleading. Each of the balance sheets included in or
incorporated by reference into the Company Reports (including the related notes
and schedules) presents fairly, or will present fairly, the financial position
of the Company and its Subsidiaries as of its date and each of the statements of
income and of changes in financial position included in or incorporated by
reference into the Company Reports (including any related notes and schedules)
presents fairly, or will present fairly, the results of operations, retained
earnings and changes in financial position, as the case may be, of the Company
and its Subsidiaries for the periods set forth therein (except as otherwise
noted therein and subject, in the case of unaudited statements, to notes and
normal year-end audit adjustments that will not be material in amount or
effect), in each case in accordance with generally accepted accounting
principles ("GAAP") consistently applied during the periods involved, except, in
the case of unaudited financial statements, as permitted by SEC Form 10-Q, and
except as may be noted therein. The Company has not, on or prior to the date
hereof, filed any other definitive reports or statements with the SEC since
March 23, 2000.
3.8 Litigation and Liabilities. Except for matters which are disclosed
in the Company Reports or those matters which are not, individually or in the
aggregate, reasonably likely to have a Company Material Adverse Effect or
prevent or materially delay or materially impair the ability of the Company to
consummate the transactions contemplated by this Agreement, there are no (i)
civil, criminal, administrative or regulatory actions, suits, claims, hearings,
investigations or proceedings pending or, to the actual knowledge of the
Company's officers and directors, threatened against the Company or any of its
Subsidiaries or (ii) material obligations or liabilities of the Company, whether
or not accrued, contingent or otherwise and whether or not required to be
disclosed in the Company Reports.
3.9 Compliance. Other than those matters which are disclosed in the
Company Reports, the Company is not in material default or violation of, (a) its
Articles of Incorporation or Bylaws, (b) any law, ordinance, rule, regulation,
order, judgment, decree, arbitration award, license or permit of any
Governmental Entity (collectively, "Laws") applicable to the Company or by which
its properties are bound, or (c) any material contract to which the Company or
any of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or its or any of their respective properties are bound or affected,
except for any such material defaults or violations that, individually or in the
aggregate, will not have a Company Material Adverse Effect, or prevent or
materially delay the transactions contemplated by this Agreement. No material
change is required in the Company's processes, properties or procedures in order
to comply in all material respects with any Laws, and the Company has not
received any notice of any material noncompliance with any such Laws that has
not been cured.
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3.10 Antitakeover Statutes. The board of directors of the Company has
taken all necessary action to approve the transactions contemplated by this
Agreement such that the restrictions under Section 607.0901 of the Florida
Business Corporation Act shall not apply to such transactions. No "fair price,"
"moratorium," "control share acquisition" or other antitakeover statute or
regulation (each, an "Antitakeover Statute") is applicable to the Sale, this
Agreement or the other transactions contemplated hereby.
3.11 Intellectual Property. The representations and warranties as set
forth in Section 14.1 of the Copromotion Agreement are correct and true as of
the Closing Date and will be correct and true as of the Additional Closing Date
and the Option Closing Date.
3.12 Brokers and Finders. Neither the Company nor any of its
Subsidiaries, officers, directors or employees has employed any broker or finder
or incurred any liability for any brokerage fees, commissions or finders' fees
in connection with the Sale or the other transactions contemplated by this
Agreement.
3.13 Certain Agreements. Neither the Company nor its Subsidiaries has
violated any provision of, or committed or failed to perform any act which, with
or without notice, lapse of time, or both, is reasonably likely to constitute a
default under the provisions of, any material contract of the Company or such
Subsidiary, and neither the Company nor any of its Subsidiaries has received
notice that any party to any such contract intends to cancel, terminate or
otherwise modify the terms of such contract, except in each case, as is not
reasonably likely to have, individually or in the aggregate, a Company Material
Adverse Effect.
3.14 No Required Vote of Company Stockholders. There is no vote of the
shareholders of the Company required to adopt this Agreement or to approve the
Sale or the transactions contemplated hereby.
3.15 Licenses and Permits. The Company and each Subsidiary has obtained
all material licenses, registrations, permits, approvals and other governmental
authorizations required to conduct its business as described in the Company
Reports. Such licenses are in full force and effect and neither the Company nor
any Subsidiary has received notice of proceedings relating to the revocation or
modification of any such license, permit, approval and other governmental
authorization.
Article 4
Representations and Warranties of Purchaser
Purchaser represents and warrants to the Company as of the date hereof
as follows:
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4.1 Authorization. The execution and delivery by Purchaser of this
Agreement and the performance by Purchaser of its obligations hereunder have
been duly authorized by all requisite partnership action.
4.2 Validity. This Agreement has been duly executed and delivered by
Purchaser and constitutes the legal, valid and binding obligation of Purchaser,
enforceable in accordance with its terms except:
(a) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement of creditors' rights generally;
(b) as limited by laws relating to the availability of
specific performance, injunctive relief, or other equitable remedies; and
(c) to the extent the indemnification provisions contained in
this Agreement may be limited by applicable Federal or state securities laws.
4.3 Investment Representations.
(a) Purchaser is an "accredited investor" within the meaning
of Rule 501 of Regulation D under the Securities Act of 1933, as amended (the
"Securities Act") and was not organized for the specific purpose of acquiring
the Shares, the Additional Shares or the Option Shares;
(b) Purchaser has sufficient knowledge and experience in
investing in companies similar to the Company in terms of the Company's stage of
development so as to be able to evaluate the risks and merits of its investment
in the Company and it is able financially to bear the risks thereof;
(c) it is the present intention that the Shares, the
Additional Shares and the Option Shares being purchased by Purchaser are being
acquired for Purchaser's own account for the purpose of investment and not with
a present view to or for sale in connection with any distribution thereof;
(d) Purchaser understands that:
(i) the Shares, the Additional Shares and the Option
Shares have not been registered under the Securities Act by reason of their
issuance in a transaction exempt from the registration requirements of the
Securities Act pursuant to Section 4(2) thereof or Rule 505 or 506 promulgated
under the Securities Act;
(ii) the Shares, the Additional Shares and the Option
Shares must be held indefinitely unless a subsequent disposition thereof is
registered under the Securities Act or is exempt from such registration;
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(iii) the Shares, the Additional Shares and the
Option Shares will bear a legend to such effect; and
(iv) the Company will make a notation on its transfer
books to such effect; and
(e) the Company has made available to Purchaser all documents
and information that the undersigned has requested relating to an investment in
the Company.
4.4 Intellectual Property. The representations and warranties as set
forth in Section 14.2 of the Copromotion Agreement are correct and true as of
the Closing Date and will be correct and true as of the Additional Closing Date
and the Option Closing Date.
4.5 Brokers and Finders. Neither the Purchaser nor any of its
Subsidiaries, officers, directors or employees has employed any broker or finder
or incurred any liability for any brokerage fees, commissions or finders' fees
in connection with the Sale or the other transactions contemplated by this
Agreement.
Article 5
Conditions
5.1 Conditions to Each Party's Obligations for the Sale. The respective
obligations of each party to effect the Sale as it pertains to both the Shares,
the Additional Shares and the Option Shares are subject to the satisfaction or
waiver at or prior to each of the Closing, the Additional Closing and the Option
Closing of each of the following conditions:
(a) No Injunctions or Restraints. (i) No court or Governmental
Entity of competent jurisdiction shall have enacted, issued, enforced or entered
any statute, rule, regulation, judgment, decree, injunction or other order
(whether temporary, preliminary or permanent) that is in effect and restrains,
enjoins or otherwise prohibits consummation of the Sale (collectively, an
"Order"); provided however, that prior to invoking this provision, each party
shall use its commercially reasonable best efforts to have any such Order lifted
or withdrawn, and (ii) no Governmental Entity shall have instituted any
proceeding seeking any such Order;
(b) Opinion of Counsel. Purchaser shall have received the
opinion of Holland & Knight LLP in substantially the form attached hereto as
Exhibit 5.1(b) at or prior to the Closing and another opinion in substantially
the same form at or prior to each of the Additional Closing and the Option
Closing;
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(c) Officer's Certificates. The representations and warranties
of the Company contained in Article 3 shall be true and correct in all material
respects on and with the same force and effect as though such representations
and warranties had been made on and as of the Closing Date, the Additional
Closing Date and the Option Closing Date. The representations and warranties of
the Purchaser contained in Article 4 shall be true and correct in all material
respects on and with the same force and effect as though such representations
and warranties had been made on and as of the Closing Date, the Additional
Closing Date and the Option Closing Date. All the terms, covenants and
conditions of this Agreement and the other agreements contemplated herein to be
complied with and performed by the Company and the Purchaser prior to the
Closing, the Additional Closing or the Option Closing shall have been duly
complied with and performed in all material respects. The Company shall have
delivered to Purchaser a certificate to such effect at or prior to the Closing,
dated the Closing Date, the Additional Closing, dated the Additional Closing
Date, and the Option Closing, dated the Option Closing Date, signed by its
President;
(d) Copromotion Agreement. The Copromotion Agreement shall not
have expired or been terminated and neither party shall be in default
thereunder;
(e) Registration Rights Agreement. The Company and Purchaser
shall have entered into the Registration Rights Agreement and such agreement
shall not have expired or been terminated prior to the Additional Closing or the
Option Closing and neither party shall be in default thereunder; and
(f) Regulatory Consents. Any waiting period under the HSR Act
shall have expired or terminated.
5.2 Conditions to Each Party's Obligations for the Sale of the
Additional Shares and the Option Shares. In addition to those conditions set
forth in Section 5.1, the respective obligations of each party to effect the
Sale as it pertains to the Additional Shares and the Option Shares is subject to
the satisfaction or waiver at or prior to the Additional Closing or the Option
Closing of each of the following conditions:
(a) Additional Closing Event. The Additional Closing Event, as
set forth in Section 1.2(a), shall have occurred.
Article 6
Miscellaneous
6.1 Termination. This Agreement shall terminate upon the expiration or
earlier termination of the Copromotion Agreement; provided however, that
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Section 2.1 shall survive for one year following the termination of the
Copromotion Agreement for any reason other than the expiration of the Term, and
provided further that Section 2.4 shall survive for one year following the
termination of the Copromotion Agreement for any reason.
6.2 Brokerage. Each party hereto will indemnify and hold harmless the
other against and in respect of any claim for brokerage or other commissions
relative to this Agreement or to the transactions contemplated hereby, based in
any way on agreements, arrangements or understandings made or claimed to have
been made by such party with any third party.
6.3 Parties in Interest. All representations, covenants and agreements
contained in this Agreement by or on behalf of any of the parties hereto shall
bind and inure to the benefit of the respective successors and assigns of the
parties hereto whether so expressed or not.
6.4 Notices. All notices, requests, consents, demands, and other
communications under this Agreement shall be in writing and shall be deemed to
have been duly given on the date of service if served personally on the party to
whom notice is to be given, on the date of transmittal of services via telecopy
to the party to whom notice is to be given (with a confirming copy delivered
within 24 hours thereafter), or on the third day after mailing if mailed to the
party to whom notice is to be given, by first class mail, registered or
certified, postage prepaid, or overnight mail via a nationally recognized
courier providing a receipt for delivery and properly addressed as follows:
If to the Company: Kos Pharmaceuticals, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
with a copy to: Holland & Knight LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
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If to Purchaser: DuPont Pharmaceuticals Company
Chestnut Run Plaza
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Senior Vice
President of Portfolio and
Business Development
with a copy to: DuPont Pharmaceuticals Company
Chestnut Run Plaza
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▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.,
General Counsel
with a copy to: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & Ingersoll, LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Any party may change its address for purposes of this paragraph by giving notice
of the new address to each of the other parties in the manner set forth above.
6.5 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida for all purposes and in all
respects, without regard to the conflict of law provisions of such state.
6.6 Dispute Resolution. Disputes arising under this Agreement shall be
resolved in accordance with Article 18 of the Copromotion Agreement.
6.7 Entire Agreement. This Agreement, the Registration Rights Agreement
and the Copromotion Agreement, including the attachments thereto, constitute the
sole and entire agreement of the parties with respect to the subject matter
hereof.
6.8 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
6.9 Amendments and Waivers. This Agreement may be amended or modified,
and provisions hereof may be waived, only with the written consent of the
Company and Purchaser.
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6.10 Severability. If any provision of this Agreement shall be declared
void or unenforceable by any judicial or administrative authority, the validity
of any other provision and of the entire Agreement shall not be affected
thereby.
6.11 Titles and Subtitles. The titles and subtitles used in this
Agreement are for convenience only and are not to be considered in construing or
interpreting any term or provision of this Agreement.
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NOW THEREFORE, the Company and Purchaser have executed this Stock
Purchase Agreement as of the date first above written.
KOS PHARMACEUTICALS, INC.
By:_________________________________
Name:
Title:
DUPONT PHARMACEUTICALS COMPANY
By:_________________________________
Name:
Title: