1
EXHIBIT 10.41
================================================================================
INSITE VISION INCORPORATED
AND
PHARMACIA & UPJOHN AB
AND
PHARMACIA & UPJOHN, SA
STOCK PURCHASE AGREEMENT
JANUARY 28, 1999
================================================================================
2
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT is made as of January 28, 1999 (the
"Agreement"), by and between INSITE VISION INCORPORATED, a Delaware corporation
with its principal office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the
"Company"), and PHARMACIA & UPJOHN AB, a Swedish corporation with a principal
office at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ("P&U") and PHARMACIA &
UPJOHN, SA, a Luxembourg corporation with its principal offices at Credit
European, ▇▇ ▇▇▇▇▇ ▇'▇▇▇▇, ▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, RC Luxembourg, B-50712 ("PUSA").
RECITALS
WHEREAS, the Company and P&U have entered into a License Agreement of
even date herewith (the "License Agreement"); and
WHEREAS, in connection with the License Agreement, the Company desires to sell
to P&U and PUSA, and P&U and PUSA desire to purchase from the Company shares of
common stock, par value $.01 per share, of the Company ("Common Stock"), on the
terms and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the following mutual covenants and
agreements, the parties agree as follows:
ARTICLE 1
PURCHASES OF COMMON STOCK
SECTION 1.1 INITIAL PURCHASE OF COMMON STOCK. Subject to the terms and
conditions of this Agreement, and in reliance on the representations and
warranties contained in this Agreement, the Company agrees to sell to P&U and
P&U agrees to purchase from the Company, at the Initial Closing (as defined
below), for a per share price of $1.8256 and aggregate consideration of two
million dollars ($2,000,000), 1,095,506 shares of Common Stock.
SECTION 1.2 PURCHASES ON ACHIEVEMENT OF MILESTONES.
(a) For purposes of this Section 1.2, the following definitions
shall apply.
(i) The "Milestone Achievement Dates" shall be the date on
which each of the following milestone events occur:
2
3
(A) * as determined by the Development Committee
(as defined in the License Agreement), in its sole
discretion, of the Company's *
(B) Either * (as
defined in the License Agreement) *
whichever occurs first
* ; and
(C) Either the *
whichever occurs first * .
(ii) The "Milestone Payments" shall be as follows:
(A) *
;
(B) *
; and
(C) *
.
(iii) The "Milestone Price Per Share" shall be the
weighted (according to sales volume) average of the daily closing
sales prices of the Company's Common Stock, as reported by the
American Stock Exchange or such other primary trading market for
the Common Stock (the "Exchange"), for the ninety (90) trading
days prior to but not including the Milestone Achievement Date.
(b) Subject to the terms and conditions of this Agreement, and in
reliance on the representations and warranties contained in this
Agreement, P&U agrees to purchase from the Company and the Company
agrees to sell to P&U, within ten (10) business days following * (a
"Milestone Closing Date") that number of shares of Common Stock of the
Company (the "Milestone Shares") determined by dividing the applicable
Milestone Payment by the Milestone Price Per Share.
(c) Subject to the terms and conditions of this Agreement, and in
reliance on the representations and warranties contained in this
Agreement, PUSA agrees to purchase
* Indicates that material has been omitted and confidential treatment has been
requested therefor. All such omitted material has been filed separately with
the Commission pursuant to Rule 24b-2.
3
4
from the Company and the Company agrees to sell to PUSA, within ten (10)
business days following * (each a "Milestone Closing
Date") that number of shares of Common Stock of the Company (the
"Milestone Shares") determined by dividing the applicable Milestone
Payment by the Milestone Price Per Share.
ARTICLE 2
CLOSING DATE; DELIVERY
SECTION 2.1 CLOSING; CLOSING DATE. Subject to the terms of Article 5,
the closing of the sale and purchase of shares of Common Stock under Sections
1.1 and 1.2 of this Agreement (the "Initial Closing" or "Milestone Closing,"
respectively) shall be held at 10:00 a.m. (Eastern Time) on the applicable
closing date at the offices of P&U or PUSA, as applicable, or at such other time
and place as the Company and P&U or PUSA may agree. The date of the Initial
Closing ("Initial Closing Date") shall be the third business day following the
date first written above, and each Milestone Closing Date shall be as provided
in Sections 1.2(b) or 1.2(c), as applicable, or, in either case, on such other
date as the Company and P&U and/or PUSA shall agree.
SECTION 2.2 DELIVERY. At the Initial Closing and within three (3)
business days of each Milestone Closing, subject to the terms and conditions of
this Agreement, the Company will deliver to P&U or PUSA, as applicable, a stock
certificate, in the name of P&U or PUSA, as applicable, representing,
respectively, the shares of Common Stock deliverable at such closing, dated as
of the Initial Closing Date or the applicable Milestone Closing Date against
payment of the purchase price therefor by wire transfer, unless P&U or PUSA and
the Company agree upon other means of payment.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Subject to and except as disclosed by the Company in the Schedule of
Exceptions attached hereto as Exhibit A, the Company represents and warrants to
P&U and PUSA as follows:
SECTION 3.1 AUTHORIZATION. All corporate action on the part of the
Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement has been taken or will
be taken prior to or as of the Initial Closing Date and each Milestone Closing
Date, as applicable. The Company has the requisite corporate power to enter into
this Agreement and carry out and perform its obligations under the terms of this
Agreement. This Agreement has been duly authorized, executed and delivered by
the Company and, upon due execution and delivery by P&U and PUSA, this Agreement
will be a valid and binding agreement of the Company, except as limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
application affecting creditors' rights generally or as limited by laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.
* Indicates that material has been omitted and confidential treatment has been
requested therefor. All such omitted material has been filed separately with
the Commission pursuant to Rule 24b-2.
4
5
SECTION 3.2 NO CONFLICT WITH OTHER INSTRUMENTS. The execution, delivery
and performance of this Agreement 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 Certificate of
Incorporation or Bylaws as either are in effect; (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, obligation or commitment to which the Company
is a party or by which it is bound; or (d) to the Company's knowledge, any
statute, rule or governmental regulation applicable to the Company.
SECTION 3.3 CERTIFICATE OF INCORPORATION; BY-LAWS. Attached hereto as
Exhibits B and C, respectively, are true, correct and complete copies of the
Certificate of Incorporation and Bylaws of the Company, as in effect on the date
hereof.
SECTION 3.4 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate power and
authority to carry on its business as now conducted and as proposed to be
conducted. The Company is duly qualified to transact business and is in good
standing in each jurisdiction in which the failure so to qualify would have a
material adverse effect on its business or properties.
SECTION 3.5 DISCLOSURE DOCUMENTS. The Company's Registration Statement
on Form S-3 (No. 333-36673) filed with the Securities and Exchange Commission on
September 29, 1997, Form 10-K for the fiscal year ended December 31, 1997 and
Forms 10-Q for the fiscal quarters ended March 31, June 30, and September 30,
1998, did not, when filed with the Securities and Exchange Commission, contain
any untrue statements of material fact or omit to state any material fact
necessary in order to make the statements therein, in light of the circumstances
in which they were made, not misleading.
SECTION 3.6 CAPITALIZATION.
(a) The authorized capital stock of the Company consists of
30,000,000 shares of Common Stock, of which 17,219,344 shares are issued
and outstanding on the date hereof, and 5,000,000 shares of Preferred
Stock, of which 900 shares of Series A Convertible Preferred Stock, par
value $.01 per share ("Series A Preferred Stock"), are issued and
outstanding on the date hereof. All such issued and outstanding shares
have been duly authorized and validly issued, and are fully paid and
nonassessable. The rights and designations of the Series A Preferred
Stock are as set forth in the Certificate of Designation included within
the Certificate of Incorporation.
(b) The Company has outstanding options to purchase 1,633,130
shares of Common Stock, outstanding warrants to purchase 317,308 shares
of Common Stock and outstanding warrants to purchase 70 shares of Series
A Preferred Stock as of the date hereof. Except as otherwise set forth
herein or in the Company's Restated Certificate of Incorporation, as
amended, or Certificate of Designations, Preferences and Rights of
Series A Convertible Preferred Stock, as corrected, there are no
preemptive or other
5
6
outstanding rights, options, warrants, conversion rights or Agreements
for the purchase or acquisition from the Company of any shares of its
capital stock or other securities of the Company.
SECTION 3.7 SUBSIDIARIES. The Company does not presently own or control,
directly or indirectly (other than investments in money market funds), and has
no stock or other interest as owner or principal in, any other corporation or
partnership, joint venture, association or other business venture or entity
except for its wholly-owned subsidiary, InSite Vision Limited.
SECTION 3.8 VALID ISSUANCE OF SHARES. The shares of Common Stock which
will be purchased by either P&U or PUSA under this Agreement, when issued, sold
and delivered in accordance with the terms of and for the consideration
expressed in this Agreement, will be duly and validly authorized and issued,
fully paid and nonassessable and, based in part upon the representations of P&U
and PUSA in Section 4.3 of this Agreement, will be issued in compliance with all
applicable federal and state securities laws.
SECTION 3.9 LITIGATION, VALIDITY OF AGREEMENT. There is no action, suit,
proceeding or, to the best of the Company's knowledge, any claim or
investigation pending or currently threatened against the Company, nor, to the
best of the Company's knowledge, is there any basis therefor, which might
result, either individually or in the aggregate, in any material adverse change
in the assets, condition, affairs or prospects of the Company, financial or
otherwise. The foregoing includes, without limitation, any action, suit,
proceeding or investigation, pending or threatened, that questions the validity
of this Agreement or any other agreement contemplated hereby or the right of the
Company to enter into such agreements.
SECTION 3.10 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, local or provincial governmental authority on
the part of the Company is required in connection with the consummation of the
transactions contemplated by this Agreement, except for notices, qualifications
or filings required or permitted to be filed with certain state or federal
securities commissions or self-regulatory organizations, which notices,
qualifications, or filings will be filed on a timely basis.
SECTION 3.11 COMPLIANCE WITH LAWS. The Company has complied and is in
compliance in all material respects with all governmental laws, orders, decrees,
rules or regulations applicable to the Company, its assets and business,
employment practices and procedures, employees or operations (except where the
failure to so comply would not have a material adverse effect on the Company,
its business and operations, or the Project as defined in the License
Agreement), including the rules and regulations of the Securities and Exchange
Commission and any exchange or automated inter-dealer quotation system on which
the Common Stock is traded and then current Good Clinical Practices and then
current Good Manufacturing Practices.
SECTION 3.12 NO BROKERS. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement.
6
7
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF P&U AND PUSA
P&U and PUSA hereby represent and warrant to the Company as follows:
SECTION 4.1 LEGAL POWER. All corporate action on the part of P&U and
PUSA, their officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement has been taken. P&U and
PUSA have the requisite corporate power to enter into this Agreement, to carry
out and perform its obligations under the terms of this Agreement and, at the
Initial Closing and each Milestone Closing, will have the requisite corporate
power to purchase the shares of Common Stock to be purchased at each such
Closing.
SECTION 4.2 DUE EXECUTION. This Agreement has been duly authorized,
executed and delivered by P&U and PUSA and, upon due execution and delivery by
the Company, this Agreement will be a valid and binding agreement of P&U and
PUSA, except as limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws of general application affecting creditors' rights generally or as
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies.
SECTION 4.3 INVESTMENT REPRESENTATIONS. In connection with the purchase
and sale of shares under this Agreement, P&U and PUSA make the following
representations:
(a) P&U and PUSA are acquiring the shares of Common Stock under
this Agreement for their own account, not as nominee or agent, for
investment and not with a view to the resale or distribution or public
offering thereof within the meaning of the Securities Act of 1933, as
amended (the "Securities Act"). P&U and PUSA have no present intention
of selling, granting any participation in, or otherwise distributing the
Common Stock acquired hereunder and has not entered into any agreement
or arrangement with any person with respect to such activities.
(b) P&U and PUSA understand that (i) the shares of Common Stock
to be purchased under this Agreement have not been registered under the
Securities Act by reason of a specific exemption therefrom, that such
securities are therefore "Restricted Securities" under the Securities
Act and must be held by P&U and PUSA, and that P&U and PUSA must bear
the economic risk of such investment, until a subsequent disposition
thereof is registered under the Securities Act or is exempt from such
registration; (ii) each certificate representing such shares will be
endorsed with the following legends:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY
STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED
OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE
APPLICABLE STATE SECURITIES
7
8
LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION
OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE
ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR
RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE
STATE SECURITIES LAWS.
and (iii) the Company will instruct any transfer agent not to register
or effect the transfer of the shares of Common Stock unless the
conditions specified in the foregoing legends are satisfied, until such
time as a transfer is made, pursuant to the terms of this Agreement, and
in compliance with Rule 144 or pursuant to a registration statement or,
if the opinion of counsel referred to above is to the further effect
that such legend is not required in order to establish compliance with
any provisions of the Securities Act or this Agreement.
(c) P&U and PUSA have such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and
risks of the investment in the shares of Common Stock purchased
hereunder and is financially able to bear the risks thereof.
(d) P&U and PUSA are each an "accredited investor" as such term
is defined in Rule 501 (a) of Regulation D of the General Rules and
Regulations prescribed by the Securities and Exchange Commission
pursuant to the Securities Act.
(e) P&U and PUSA have had an opportunity to ask questions and
receive answers from the Company regarding the Company and the terms and
conditions of the offering of the Common Stock and to obtain additional
information necessary to verify the accuracy of the information given to
P&U and PUSA. P&U and PUSA have received information that they consider
necessary or appropriate for deciding whether to purchase the Common
Stock.
(f) P&U and PUSA are not a party to any agreement or instrument,
or subject to any charter or other corporate restriction or any
judgment, order, decree, law, ordinance, regulation or other
governmental restriction which would prevent or impede, or be breached
or violated by, the transactions contemplated in this Agreement.
SECTION 4.4 NO BROKERS. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement.
SECTION 4.5 ORGANIZATION, GOOD STANDING AND QUALIFICATION. P&U and PUSA
are corporations duly organized, validly existing and in good standing under the
laws of the Sweden and Luxembourg, respectively, and have all requisite
corporate power and authority to carry on their business as now conducted and as
proposed to be conducted. P&U and PUSA are duly qualified to transact business
and are in good standing in each jurisdiction in which the failure so to qualify
would have a material adverse effect on their business or properties.
8
9
SECTION 4.6 VALIDITY OF AGREEMENT. No action, suit, proceeding or
investigation is pending or threatened that questions the validity of this
Agreement or any other agreement contemplated hereby or the right of P&U and
PUSA to enter into such agreements.
SECTION 4.7 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, local or provincial governmental authority on
the part of P&U and PUSA is required in connection with the consummation of the
transactions contemplated by this Agreement, except for notices, qualifications
or filings required or permitted to be filed with certain state or federal
securities commissions or self-regulatory organizations, which notices,
qualifications, or filings will be filed on a timely basis.
ARTICLE 5
CONDITIONS TO CLOSING
SECTION 5.1 CONDITIONS TO OBLIGATIONS OF P&U AND PUSA AT INITIAL AND
MILESTONE CLOSINGS. P&U's obligation to purchase the shares of the Company's
Common Stock at the Initial Closing, and P&U's and PUSA's obligation, if any, to
purchase the shares of the Company's Common Stock and at each Milestone Closing,
as applicable, are subject to the fulfillment to P&U's and PUSA's satisfaction,
on or prior to the Initial Closing or such Milestone Closing, as applicable, of
each of the following conditions, any of which may be waived by P&U or PUSA:
(a) Representations and Warranties/Performance of Obligations.
The representations and warranties made by the Company in Article 3
hereof and in the License Agreement shall be true and correct in all
material respects on the Initial Closing Date and on each Milestone
Closing Date with the same force and effect as if they had been made on
and as of that date, and the Company shall have performed and complied
in all material respects with all material obligations and conditions
required under this Agreement to be performed or complied with by it on
or prior to the Initial Closing or Milestone Closing, as applicable and
a Certificate of the Company, certifying the foregoing, shall be
delivered to P&U or PUSA at the Initial Closing and each Milestone
Closing, as applicable; provided, however, that notwithstanding the
foregoing, (i) the Company shall be entitled to update and revise the
representations made in Section 3.6 to the extent that such changes do
not conflict with or breach Section 6.2, and such changes shall not
affect P&U's or PUSA's obligation to effect any Milestone Closing, and
(ii) no action, suit, proceeding, claim or investigation (or threat
thereof) by P&U or PUSA, their respective affiliates or agents, or for
the benefit of P&U or PUSA, shall be deemed to preclude the Company from
making the representations set forth in Section 3.9 at any Milestone
Closing and shall not affect P&U's or PUSA's obligation to effect any
such Milestone Closing, as applicable.
(b) Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated at the
Initial Closing and each Milestone Closing and all documents and
instruments incident to such actions shall be reasonably
9
10
satisfactory in substance and form to counsel to P&U and PUSA, and
counsel to P&U and PUSA shall have received all such counterpart
originals or certified or other copies of such documents as they may
reasonably require.
(c) Qualifications, Legal Investment. All authorizations,
approvals, or permits, if any, of any governmental authority or
regulatory body of the United States or of any state that are required
in connection with the lawful sale and issuance of the shares of Common
Stock to be sold and issued pursuant to this Agreement shall have been
duly obtained and shall be effective on and as of, respectively, the
Initial Closing and each Milestone Closing. No stop order or other order
enjoining the sale of the shares to be sold at such Closing shall have
been issued and no proceedings for such purpose shall be pending or, to
the knowledge of the Company, threatened by the Securities and Exchange
Commission, or any commissioner of corporations or similar officer of
any state having jurisdiction over such transaction. At the time of the
Initial Closing and each Milestone Closing, the sale and issuance of the
shares of Common Stock to be issued and sold at such closing shall be
legally permitted by all laws and regulations to which P&U or PUSA, as
applicable, and the Company are subject.
(d) Opinion of Counsel to the Company. In connection with any
sale of shares hereunder, P&U and PUSA, as applicable, shall have
received from counsel to the Company, an opinion letter addressed to
them, dated the date of the Initial Closing and each Milestone Closing,
as applicable, in substantially the form attached hereto as Exhibit D.
(e) No Material Adverse Change. With respect to the Initial
Closing only, the Company shall not have suffered a material adverse
change to its business taken as a whole from November 12, 1998 through
the Initial Closing Date. For purposes of this condition, the layoff of
employees by the Company in December 1998 shall not be considered a
material adverse change.
(f) No Material Default or Notice of Termination under the
License Agreement. In addition to the conditions set forth above, P&U's
and PUSA's obligation to purchase the shares of the Company's Common
Stock, as applicable, at each Milestone Closing shall also be subject to
the condition that the Company is not in material default under the
License Agreement or that a notice of termination of the License
Agreement shall not have been duly given by either party under the terms
of such License Agreement.
(g) Shares Available. The Company has available under its
Certificate of Incorporation as in effect on the date hereof, and shall
have available under its Certificate of Incorporation as in effect at
the Initial Closing Date and each Milestone Closing Date, sufficient
authorized but unissued shares of its Common Stock to issue and sell to
P&U and PUSA, as applicable, all of the shares of Common Stock to be
issued on such dates.
SECTION 5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY AT CLOSING. The
Company's obligation to issue and sell the shares of its Common Stock to be sold
at the Initial Closing and each Milestone Closing, as applicable, is subject to
the fulfillment to the Company's satisfaction,
10
11
on or prior to the Initial Closing or such Milestone Closing, of each of the
following conditions, any of which may be waived by the Company:
(a) Representations and Warranties/Performance of Obligations.
The representations and warranties made by P&U and PUSA in Article 4
hereof and in the License Agreement shall be true and correct in all
material respects on the Initial Closing and on each Milestone Closing
Date, as applicable, with the same force and effect as if they had been
made on and as of that date, and P&U and PUSA shall have performed and
complied in all material respects with all material obligations and
conditions required under this Agreement to be performed or complied
with by it on or prior to the Initial Closing or Milestone Closing, as
applicable, and a certificate duly executed by an officer of P&U and
PUSA, as applicable, certifying the foregoing, shall be delivered to the
Company at the Initial Closing and each Milestone Closing; provided,
however, that notwithstanding the foregoing, no action, suit,
proceeding, claim or investigation (or threat thereof) by the Company,
its affiliates or agents, or for the benefit of the Company, shall be
deemed to preclude P&U or PUSA, as applicable, from making the
representation set forth in Section 4.6 at any Milestone Closing and
shall not affect the Company's obligation to effect any such Milestone
Closing.
(b) Qualifications, Legal Investment. All authorizations,
approvals, or permits, if any, of any governmental authority or
regulatory body of the United States or of any state that are required
in connection with the lawful sale and issuance of the shares of Common
Stock to be sold and issued pursuant to this Agreement shall have been
duly obtained and shall be effective on and as of, respectively, the
Initial Closing and each Milestone Closing, as applicable. No stop order
or other order enjoining the sale of the shares to be sold at such
closing shall have been issued and no proceedings for such purpose shall
be pending or, to the knowledge of the Company, threatened by the
Securities and Exchange Commission, or any commissioner of corporations
or similar officer of any state having jurisdiction over such
transaction. At the time of the Initial Closing and the Milestone
Closing, the sale and issuance of the shares of Common Stock to be sold
and issued at such closing shall be legally permitted by all laws and
regulations to which P&U or PUSA, as applicable and the Company are
subject.
(c) No Material Default or Notice of Termination under the
License Agreement. In addition to the conditions set forth above, the
Company's obligation to sell the shares of the Company's Common Stock at
each Milestone Closing shall also be subject to the condition that P&U
is not in material default under the License Agreement or that a notice
of termination of the License Agreement shall not have been duly given
by either party under the terms of such License Agreement.
ARTICLE 6
COVENANTS OF THE COMPANY
11
12
SECTION 6.1 AFFIRMATIVE COVENANTS OF THE COMPANY. The Company agrees
that it shall do the following for so long as P&U and PUSA, together or
individually, own at least five percent (5%) of the Company's outstanding Common
Stock.
(a) Preserve and maintain its corporate existence and good
standing in the State of Delaware, and qualify and remain qualified as a
foreign corporation in each jurisdiction in which the failure to so
qualify would have a material adverse effect on its business or
properties.
(b) Keep adequate (i) records and books of account reflecting all
financial transactions of the Company's business, (ii) minute books
containing accurate records of all meetings and accurately reflecting
all corporate action of its shareholders and its board of directors, and
(iii) stock books and ledgers correctly recording all transfers and
issuances of all capital stock.
(c) Maintain, keep and preserve all the assets owned, leased or
used in the Company's business in reasonable operating condition and
repair, ordinary wear and tear excepted, and discharge and pay in full
when due, except those disputed in good faith, all obligations of the
Company.
(d) Taking into account the Company's recent downsizing *
, engage in the Company's research and development and
business in the ordinary course and use reasonable commercial efforts to
preserve its business and the goodwill of customers, suppliers and
others having business relations with the Company.
(e) Comply with all material terms and conditions of the License
Agreement.
(f) Maintain insurance on the assets of the Company comparable to
that which the Company has customarily maintained in the past but taking
into account the Company's recent downsizing * .
(g) Comply in all material respects with all governmental laws,
orders, decrees, rules or regulations applicable to the Company, its
assets and business, employment practices and procedures, employees or
operations, including the rules and regulations of the Securities and
Exchange Commission and any exchange or automated inter-dealer quotation
system on which the Common Stock is traded and then current Good
Clinical Practices and then current Good Manufacturing Practices, except
where the failure to so comply will not have a material adverse effect
on the Company, its business and operations, or the Project (as defined
in the License Agreement).
(h) Timely file, through *, all tax returns that are required to
be filed by it and pay on or before the date they are required to be
paid all taxes due pursuant to those tax returns or any assessment
received by it or otherwise required to be paid, except taxes being
contested in good faith by appropriate proceedings, if applicable.
* Indicates that material has been omitted and confidential treatment has been
requested therefor. All such omitted material has been filed separately with
the Commission pursuant to Rule 24b-2.
12
13
SECTION 6.2 NEGATIVE COVENANTS OF THE COMPANY. The Company agrees that,
so long as P&U and PUSA, individually or collectively own at least five percent
(5%) of the Company's outstanding Common Stock, it shall not do, without P&U's
and PUSA's prior written approval (which approval shall not be unreasonably
withheld), any of the following:
(a) Amend its Certificate of Incorporation or its by-laws in any
manner that would materially and adversely affect the ability of the
Company to consummate the transactions contemplated by this Agreement or
the License Agreement.
(b) Through * , merge (forward or reverse) or
consolidate with any person or entity or, directly or indirectly, sell,
lease, or otherwise dispose of (other than through a license) any of the
assets related to the Project (as defined in the License), or any of its
other material assets used in its business (whether now owned or
hereafter acquired) or engage in a major recapitalization or conversion,
in each case whether in one transaction or in a series of transactions.
However, the Company may license its other products to third parties,
provided that the Company notifies P&U of any such license before that
license becomes effective.
(c) Through * , transfer any of the Company's
material assets used in its business to any person and thereafter
directly or indirectly lease back the same or similar property or
through * transfer, sell or assign rights or interests (other than
through licenses) in any of the material assets, intellectual property
or other property used in the Company's business now owned or hereafter
acquired, including accounts receivable.
(d) Make any significant change in its accounting policies,
except for any change required by GAAP or otherwise in the opinion of
the Company's independent public accountants.
SECTION 6.3 DEMAND REGISTRATIONS.
(a) At any time that P&U and/or PUSA owns any Common Stock of the
Company, P&U and PUSA each shall have the right to cause the Company to
register such Registrable Shares (as defined below) with the Securities
and Exchange Commission and qualify such shares with such state
securities commission as P&U and/or PUSA shall reasonably request in
order to allow P&U and/or PUSA to sell such shares, provided that the
Company shall not be required to qualify such shares in any state where
such qualification would require the Company to consent to personal
jurisdiction in such state (the "Demand Registration Right"). P&U and
PUSA each shall be entitled to a total of * Demand
Registration Rights. As used in Sections 6.4 through 6.9 and 7.2, the
term "Registrable Shares" shall mean all Common Stock issued to P&U and
PUSA pursuant to this Agreement.
(b) If, in any offering under P&U and/or PUSA Demand Registration
Rights which involves an underwriting and any other person has
piggy-back registration rights with respect to such registration, the
managing underwriter shall impose a limitation on
* Indicates that material has been omitted and confidential treatment has been
requested therefor. All such omitted material has been filed separately with
the Commission pursuant to Rule 24b-2.
13
14
the number of shares which may be included in the registration statement
because, in its judgment, such limitation is necessary to effect an
orderly public distribution or because in its judgment the inclusion of
shares being sold by persons other than P&U and/or PUSA would adversely
affect the offering, then the Company shall not be obligated to include
in such registration statement any portion of shares of any other person
or P&U and/or PUSA as provided in 6.3(c) below.
(c) Notwithstanding any other provision of this Section 6.3, if
the underwriter, in its reasonable judgment, advises the Company in
writing that marketing factors require a limitation of the number of
shares to be underwritten, then the Company shall so advise P&U and
PUSA, as applicable, and any other holders of registrable securities
which would otherwise be underwritten pursuant to such registration
statement, and the number of shares of registrable securities that may
be included in the underwriting shall be allocated among all such
persons, including P&U and PUSA, first to P&U and PUSA, as applicable,
and any other persons making such demand together with P&U and/or PUSA
and then to all other persons, and in each case, in proportion (as
nearly as practicable) to the amount of registrable securities of the
Company owned by each such person.
(d) Notwithstanding the foregoing, if the Company shall furnish
to P&U and/or PUSA, as applicable, a certificate signed by the Chief
Executive Officer of the Company stating that, in the good faith
judgment of the Board of Directors of the Company, it would be seriously
detrimental to the Company and its shareholders for such registration
statement to be filed and it is therefore essential to defer the filing
of such registration statement, the Company shall have the right to
defer taking action with respect to such filing for a period of not more
than ninety (90) days after receipt of the demand of P&U and/or PUSA;
provided that the Company may not utilize this right more than once in
any twelve-month period.
SECTION 6.4 PIGGY-BACK REGISTRATION.
(a) If the Company shall determine at any time to register for
its own account or the account of others under the Securities Act any of
its equity securities, other than on Form S-4 or Form S-8 or their then
equivalents or otherwise relating to shares of Common Stock to be issued
in connection with any acquisition of any entity or business or shares
of Common Stock issuable under stock option or other employee benefit
plans, it shall send to P&U and PUSA written notice of such
determination and, if within five (5) business days after receipt of
such notice, P&U and/or PUSA shall so request in writing, the Company
shall use its best efforts to include in such registration statement all
or any part of the Registrable Shares that P&U and/or PUSA requests to
be registered.
(b) If, in connection with any offering involving an
underwriting, the managing underwriter shall impose a limitation of the
number of shares which may be included in the registration statement
because, in its judgment, such limitation is necessary to affect an
orderly public distribution or because in its judgment the inclusion of
shares being sold by persons other than the Company would adversely
effect the offering, then the Company shall be obligated to include in
such registration statement
14
15
only such limited portion (which may be none) of the Registrable Shares
with respect to which P&U and/or PUSA has requested inclusion pursuant
hereto as may reasonably be determined by the managing underwriter. Any
inclusion of Registrable Shares in an offering, when the managing
underwriter has so limited the number of shares that may be included in
such offering, shall be allocated pro rata among the holders of similar
"piggyback" registration rights granted by the Company seeking to
include their shares, in proportion to the number of shares (whether or
not such shares are sought to be included in such offering) held by such
persons. The Company shall have the right to delay or withdraw any
registration initiated by it pursuant to Section 6.4 hereof.
SECTION 6.5 EFFECTIVENESS. The Company will use its best efforts to
maintain the effectiveness for up to 90 days, (or such shorter period of time as
the underwriters need to complete the distribution of a registered offering or
until the securities are actually sold) of any registration statement pursuant
to which any of the Registrable Shares are being offered, and from time to time
will amend or supplement such registration statement and the prospectus
contained therein to the extent necessary to comply with the Securities Act and
any applicable state securities laws or regulations.
SECTION 6.6 INDEMNIFICATION.
(a) In the event that the Company registers any of the
Registrable Shares under the Securities Act, the Company will indemnify
and hold harmless P&U and PUSA and each underwriter of Registrable
Shares (including their officers, directors, affiliates and partners and
including any broker or dealer through whom Registrable Shares may be
sold in such registration) and each person, if any, who controls P&U and
PUSA or any such underwriter within the meaning of Section 15 of the
Securities Act from and against any and all losses, claims, damages,
expenses or liabilities, joint or several, to which they or any of them
become subject under the Securities Act, applicable state securities
laws or under any other statute or at common law or otherwise, as
incurred, and, except as hereinafter provided, will reimburse P&U and
PUSA, each such underwriter and each such controlling person, if any,
for any legal or other expenses reasonably incurred by them or any of
them in connection with investigating or defending any actions whether
or not resulting in any liability, as incurred, insofar as such losses,
claims, damages, expenses, liabilities or actions arise out of or are
based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement, in any
preliminary or amended preliminary prospectus or in the final prospectus
(or the registration statement or prospectus as from time to time
amended or supplemented by the Company) or arise out of or are based
upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the
statements therein not misleading, or any violation by the Company of
any rule or regulation promulgated under the Securities Act or any state
securities laws applicable to the Company and relating to action or
inaction required of the Company in connection with such registration,
unless (i) such untrue statement or alleged untrue statement or omission
or alleged omission was made in such registration statement, preliminary
or amended preliminary prospectus or final prospectus in reliance upon
and in conformity with information furnished in writing to the Company
in connection therewith by ▇&▇ ▇▇
▇▇
▇▇
▇▇▇▇ or any such underwriter expressly for use therein, or unless (ii)
in the case of a sale directly by P&U and/or PUSA (including a sale of
Registrable Shares through any underwriter retained by P&U and/or PUSA
to engage in a distribution solely on behalf of P&U and/or PUSA), such
untrue statement or alleged untrue statement or omission or alleged
omission was contained in a preliminary prospectus and corrected in a
final or amended prospectus copies of which were delivered to P&U or
PUSA or such underwriter on a timely basis, and P&U, PUSA or such
underwriter failed to deliver a copy of the final or amended prospectus
at or prior to the confirmation of the sale of the Registrable Shares to
the person asserting any such loss, claim, damage or liability in any
case where such delivery is required by the Securities Act; provided,
however, that the indemnity agreement contained in this subsection
6.6(a) shall not apply to amounts paid in settlement of any such loss,
claim, damage, expense, liability or action if such settlement is
effected without the consent of the Company, which consent shall not be
unreasonably withheld.
(b) P&U and PUSA, as applicable, will indemnify and hold harmless
the Company, each underwriter of Registrable Shares and any other
persons selling securities in such registration statement (including
their officers, directors, affiliates and partners and including any
broker or dealer through whom Registrable Shares may be sold in such
registration) and each person, if any, who controls the Company, any
such underwriter or other such person selling securities in such
registration statement within the meaning of Section 15 of the
Securities Act from and against any and all losses, claims, damages,
expenses or liabilities, joint or several, to which they or any of them
may become subject, under the Securities Act, applicable state
securities laws or under any other statutes or at common law or
otherwise, as incurred, insofar as such losses, claims, damages,
expenses or liabilities (or actions in the respect thereto) arise out of
are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement, in any
preliminary or amended preliminary prospectus or in the final prospectus
(or the registration statement or prospectus as from time to time
amended or supplemented by the Company) or arise out of or are based
upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the
statements therein not misleading, or any violation by the Company of
any rule or regulation promulgated under the Securities Act or any state
securities laws applicable to the Company and relating to action or
inaction required of the Company in connection with such registration,
in each case to the extent (and only to the extent) that such untrue
statement, alleged untrue statement, alleged omission, omission or
violation occurs in reliance upon and in conformity with written
information furnished by or on behalf of P&U or PUSA expressly for use
in connection with such registration; and P&U or PUSA will reimburse, as
incurred, the Company, each such underwriter, each such other person
selling securities in such registration statement and each such
controlling person, if any, for any legal or other expenses reasonably
incurred by them or any of them in connection with investigating or
defending any such loss, claim, damage, liability or action, whether or
not resulting in any liability; provided, however, that the indemnity
agreement contained in this subsection 6.6(b) shall not apply to amounts
paid in settlement of any such loss, claim, damage, expense, liability
or action if such settlement is effected without the consent of P&U or
PUSA, which consent shall not be
16
17
unreasonably withheld. In any event, the liability of P&U or PUSA under
the indemnity provisions of this Agreement shall be limited to an amount
equal to the gross proceeds received by P&U or PUSA from the sale of
shares in any transaction to which such indemnification relates.
(c) Promptly after receipt by an indemnified person under this
Section 6.6 of notice of the commencement or threat of any action in
respect of which indemnity may be sought against the indemnifying party,
such indemnified person shall notify the indemnifying party in writing
of the commencement thereof (provided, that failure to so notify the
indemnifying party shall not relieve the indemnifying party from any
liability it may have hereunder, except to the extent prejudiced by such
failure) and, subject to the provisions hereinafter stated, the
indemnifying party shall be entitled to assume the defense of such
action (including the employment of counsel) and the payment of expenses
insofar as such action shall relate to any alleged liability in respect
of which indemnity may be sought against the indemnifying party.
(d) An indemnified person under this Section 6.6 shall have the
right to employ separate counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel
subsequent to any assumption of the defense by the indemnifying party
shall not be at the expense of the indemnifying party (but shall be at
the sole expense of the indemnified person) unless the employment of
such counsel has been specifically authorized in writing by the
indemnifying party; provided, however, that, if the defendants in any
such action include both the indemnified person and the indemnifying
party and the indemnified person shall have reasonably concluded that
there may be reasonable defenses available to it which are different
from or additional to those available to the indemnifying party or if
the interests of the indemnified person reasonably may be deemed to
conflict with the interests of the indemnifying party, the indemnified
person shall have the right to select a separate counsel and to assume
such legal defenses and otherwise to participate in the defense of such
action, with the expenses and fees of such separate counsel and other
expenses related to such participation to be reimbursed by the
indemnifying party as incurred. At any time, an indemnified person may
select separate counsel and assume its own legal defense with the
expenses and fees of such separate counsel and other expenses related to
such separate counsel to be borne by such indemnified person. An
indemnifying party shall not be liable to an indemnified person for any
settlement of any such action effected without the indemnifying party's
written consent (which consent shall not be unreasonably withheld or
delayed). An indemnifying party shall not, except with the approval of
each party being indemnified under this Section 6.6 (which approval
shall not be unreasonably withheld or delayed), consent to entry of any
judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to
the parties being so indemnified of a release from all liability in
respect to such claim or litigation.
(e) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which an
indemnified person makes a claim for indemnification pursuant to this
Section 6.6 but indemnification is unavailable to or
17
18
insufficient to hold harmless an indemnified person, or it is judicially
determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 6.6
provides for indemnification in such case, then the indemnifying party
and the indemnified person will contribute to the aggregate losses,
claims, damages or liabilities to which they may be subject (after
contribution from others) in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and
of the indemnified person on the other hand in connection with the
statements or omissions which resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations.
The relative fault of the indemnifying party on the one hand and of
indemnified person on the other hand shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company on the one hand or
by P&U or PUSA on the other hand, and each party's relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission; provided, however, that, in any such case,
(A) except in the case of willful misconduct or fraudulent
misrepresentations, P&U and PUSA will not be required to contribute any
amount in excess of the public offering price of all Registrable Shares
offered by it pursuant to such registration statement; and (B) no person
or entity guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) will be entitled to contribution
from any person or entity who was not guilty of such fraudulent
misrepresentation.
SECTION 6.7 FURTHER OBLIGATIONS OF THE COMPANY. Whenever under the
preceding Sections of this Article 6, the Company is required to register
Registrable Shares, the Company agrees that it shall also do the following:
(a) Furnish to P&U and PUSA, as applicable, such copies of each
preliminary and final prospectus and such other documents as P&U and
PUSA, as applicable, may reasonable request to facilitate the public
offerings of the Registrable Shares;
(b) Use its best efforts to register or qualify the Registrable
Shares covered by the registration statement under the applicable
securities or "blue sky" laws of such jurisdictions as P&U or PUSA may
reasonably request;
(c) Permit P&U and PUSA, as applicable, or their counsel or other
representatives to inspect and copy such corporate documents and records
as may reasonably be requested by them, after reasonable advance notice,
during normal business hours and without undue interference with the
operation of the Company's business;
(d) Furnish to P&U and PUSA, as applicable, a copy of all
documents filed with and all correspondence from or to the Securities
and Exchange Commission in connection with any such offering of
securities;
18
19
(e) Otherwise use its best efforts to comply with all applicable
rules and regulations of the Securities and Exchange Commission, and (to
the extent required) make available to its security holders, as soon as
reasonably practicable, an earning statement covering the period of at
least twelve months, but not more than eighteen months, beginning with
the first month after the effective date of the registration statement
covering a public offering, which earning statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.
SECTION 6.8 EXPENSES. In the case of each registration effected under
Sections 6.3, 6.4 and 6.7, the Company shall bear its own reasonable costs and
expenses of each such registration on behalf of P&U and/or PUSA, including, but
not limited to, the Company's printing, legal and accounting fees and expenses,
Securities and Exchange Commission and NASD filing fees and "blue sky" fees and
expenses; provided, however, that the Company shall have no obligation to pay or
otherwise bear any portion of the underwriters' commissions or discounts or
transfer taxes attributable to the Registrable Shares being offered and sold by
P&U and/or PUSA, or the fees and expenses of counsel for P&U and/or PUSA in
connection with the registration of the Registrable Shares.
SECTION 6.9 TERMINATION OF REGISTRATION RIGHTS. No holder of Registrable
Shares shall be entitled to exercise any right provided for in, and the Company
shall have no obligation pursuant to, Sections 6.3, 6.4, 6.5 or 6.7 hereof after
such time as all Registrable Shares held by a holder may be sold pursuant to
Rule 144 promulgated under the Securities Act during a given ninety-day period;
provided, however, if the Company fails to comply with SEC Rule 144(c)(1), the
Company's obligations pursuant to Section 6.3, 6.4, 6.5 and 6.7 hereof shall be
reinstated for so long as such failure to comply shall continue.
ARTICLE 7
COVENANTS OF P&U AND PUSA
SECTION 7.1 STANDSTILL AGREEMENT. Other than shares of Common Stock
which they are purchasing pursuant to this Agreement, P&U and PUSA hereby
covenants and agrees that they will not, nor will they permit any of their
affiliates (including parents, subsidiaries or other related entities) to,
purchase or otherwise acquire, directly or indirectly, any equity securities of
the Company (or any securities convertible, exercisable or exchangeable for any
such securities) without the prior written approval of the Company. This
provision shall terminate and be of no further force or effect one (1) year from
the date hereof or such earlier date as shall be agreed to in writing by the
Company; provided, that the restrictions of this Section 6.3 shall automatically
terminate upon the occurrence of any of the following events: (a) the filing
with the Securities and Exchange Commission of a Schedule 13D by any person or
entity indicating that a person or entity has acquired beneficial ownership of
(x) more than 9.99% of any class of the Company's voting equity securities, or
(y) has acquired at least 5% of any class of the Company's voting equity
securities which Schedule 13D expresses the filing party's intention to assume
control of the Company, whether by tender offer, merger, proxy contest or
otherwise; (b) the commencement of a tender offer by any person or entity to
acquire beneficial ownership of 9.99% or more of the Company's outstanding
voting equity securities; or (c) the solicitation of
19
20
proxies by any party other than the Company to which Rule 14(a) of the rules and
regulations under the Securities and Exchange Act of 1934, as amended, applies
and is intended to effect a change in the majority of members of the Company's
Board of Directors.
SECTION 7.2 REGISTRATION. Whenever under the preceding Sections of
Article 6, P&U and/or PUSA is registering Registrable Shares pursuant to any
registration statement, (i) P&U and/or PUSA, as applicable, agree to timely
provide to the Company, at its request, such information and materials as it may
reasonably request in order to effect the registration of such Registrable
Shares and (ii) if the offering is underwritten, the Company and P&U and/or
PUSA, as applicable, agree to execute an underwriting agreement containing
customary conditions.
SECTION 7.3 VOTING AGREEMENT. P&U and PUSA agree that they shall, so
long as they hold shares of Common Stock, vote such shares with respect to any
proposed merger or combination or sale of all or substantially all of the assets
of the Company, with or to any other entity in the same proportion as the shares
of the Company's equity securities voted in favor of such transaction by other
parties who are not themselves a party to any such merger, combination or asset
sale; provided, however, that the foregoing voting requirement shall not apply
to P&U or PUSA in any transaction which is not approved by the Company's Board
of Directors or in the event of a proposed merger or combination or sale of
substantially all of the assets of the Company to a competitor of P&U or PUSA.
SECTION 7.4 LIMITATION ON SECURITIES ISSUED PURSUANT TO THIS AGREEMENT.
Unless permitted by the applicable rules and regulations of the Exchange, in no
event shall the total number of shares of Common Stock issued pursuant to this
Agreement exceed the maximum number of shares of Common Stock that the Company
can so issue pursuant to Rule 713(a) of the American Stock Exchange (or any
successor rule or comparable rule of an applicable Exchange) which, as of the
date of this Agreement shall be 19.99% of shares outstanding on the date of this
Agreement.
ARTICLE 8
MISCELLANEOUS
SECTION 8.1 GOVERNING LAW. This Agreement shall be governed by and
interpreted in accordance with the substantive laws of the State of New York and
the United States of America, without regard to choice of law rules thereof.
SECTION 8.2 PUBLIC STATEMENTS. Any statement to the public regarding
this Agreement or any aspect of this Agreement shall be made subject to and in
accordance with the terms of the License Agreement.
SECTION 8.3 ASSIGNMENT. The rights and obligations under this Agreement
may not be assigned by either the Company, P&U or PUSA without the prior written
consent of the other party; provided, however, that the Company may, without the
prior consent of P&U or PUSA, assign the rights and obligations under this
Agreement to the acquiring company or any of its affiliates in connection with a
merger, combination or sale of all or substantially all of the assets
20
21
of the Company, unless such merger or combination or sale of substantially all
of the assets of the Company is to a competitor of P&U or PUSA.
SECTION 8.4 SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, the provisions of this Agreement shall inure to the benefit of,
and be binding upon, the successors, and permitted assigns of the Company, P&U
and PUSA.
SECTION 8.5 ENTIRE AGREEMENT. This Agreement and the License Agreement
(and all of their exhibits and appendices (collectively, the "Agreements")) set
forth all of the covenants, promises, agreements, warranties, representations,
conditions, and understandings between the Company, P&U and PUSA and supersede
and terminate all prior agreements and understandings between these parties with
respect to the subject matter hereof and thereof. There are no covenants,
promises, agreements, warranties, representations, conditions or understandings,
either oral or written, between the Company, P&U and PUSA other than as set
forth in the Agreement, the License Agreement (and all of their exhibits and
appendices). The Agreements are intended to define the full extent of the
legally enforceable undertakings of the Company, P&U and PUSA and no promise or
representation, whether written or oral, which is not set forth explicitly
herein or therein is intended by either party to be legally binding. The
Company, P&U and PUSA acknowledge that, in deciding to enter into this Agreement
and to consummate the transactions contemplated under this Agreement, neither
has relied upon any statement or representation, written or oral, other than
those explicitly set forth in this Agreement.
SECTION 8.6 SEVERABILITY. Whenever possible, each provision of the
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of the Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of the Agreement. In the event of such invalidity, the parties shall seek to
agree on an alternative enforceable provision that preserves the original
purpose of this Agreement.
SECTION 8.7 AMENDMENT AND WAIVER. Except as otherwise provided herein,
any term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance, either
retroactively or prospectively, and either for a specified period of time or
indefinitely), with the written consent of the Company, P&U and PUSA. No
amendment to this Agreement shall be binding upon the parties unless reduced to
writing and signed by the respective authorized officers of the parties. Any
amendment or waiver effected in accordance with this Section shall be binding
upon any holder of any securities purchased under this Agreement (including
securities into which such securities have been converted), each future holder
of all such securities, and the Company.
SECTION 8.8 NOTICES. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effectively given
and received (a) upon personal delivery, (b) on the fifth day following mailing
by registered or certified mail return receipt requested postage prepaid,
addressed to the Company, P&U or PUSA at their respective addresses listed below
(or at such other address for a party as shall be specified by like notice;
provided, that notices of a change of address shall be effective only upon
receipt thereof),
21
22
(c) upon transmission by facsimile (with telephonic notice), or (d) upon
confirmed delivery by overnight commercial courier service:
If to the Company, address to: InSite Vision Incorporated
Attention: Chief Executive Officer
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with a copy to: ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Two Embarcadero Place
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
If to P&U, address to: Pharmacia & Upjohn
Attention: Vice President, Licensing
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Pharmacia & Upjohn AB
Chief Legal Counsel
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
with a copy to: Pharmacia & Upjohn
Attention: Vice President, Corporate Law
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
If to PUSA, address to: Pharmacia & Upjohn, SA
Credit European
▇▇ ▇▇▇▇▇ ▇'▇▇▇▇
▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
RC Luxembourg, B-50712
Pharmacia & Upjohn
Attention: Vice President, Licensing
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
with a copy to: Pharmacia & Upjohn
Attention: Vice President, Corporate Law
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
22
23
SECTION 8.9 FEES AND EXPENSES. Except as otherwise provided herein, the
Company, P&U and PUSA shall bear their own expenses and legal fees incurred on
their behalf with respect to this Agreement and the transactions contemplated
hereby.
SECTION 8.10 TITLES AND SUBTITLES. The titles of the sections and
subsections of this Agreement are for convenience of reference only and are not
to be considered in construing this Agreement.
SECTION 8.11 COUNTERPARTS This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument.
23
24
IN WITNESS WHEREOF, this Agreement is executed and delivered by the
parties as of the date first above written.
INSITE VISION INCORPORATED
By:______________________________
Name:
Title:
PHARMACIA & UPJOHN AB
By:______________________________
Name:
Title:
By:_______________________________
Name:
Title:
PHARMACIA & UPJOHN, SA
By:______________________________
Name:
Title:
24