EXHIBIT 10.33
PREFERRED STOCK PURCHASE AGREEMENT
This Preferred Stock Purchase Agreement (the "Agreement") is entered into
this 30th day of December, 1994 by and between SCIOS NOVA INC., a Delaware
corporation (the "Company"), and GENENTECH, INC., a Delaware corporation (the
"Purchaser").
RECITALS
A. The parties desire that the Purchaser make an investment in the
Company through the purchase of Preferred Stock.
B. The Purchaser has also agreed to loan the Company $30 million pursuant
to a Note Agreement of even date herewith (the "Note Agreement").
C. The parties also desire to enter into a collaboration agreement (the
"Collaboration Agreement") relating to certain products for the treatment and
prevention of acute renal failure.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and promises set forth in this Agreement, the parties agree as follows:
1. SALE AND PURCHASE. Subject to the terms and conditions hereof and in
reliance upon the representations and warranties contained herein, the Company
will issue and sell to the Purchaser at the Closing, and the Purchaser will
purchase from the Company at the Closing 21,053 shares of Series A Preferred
Stock of the Company at a purchase price of $950.00 per share, for an aggregate
purchase price of $20,000,350. Such Preferred Stock shall have the rights,
preferences, and privileges described in the Company's Certificate of
Designation, a copy of which is attached as Exhibit A (the "Certificate of
Designation"). The shares of Preferred Stock to be issued and sold to the
Purchaser hereunder are hereinafter referred to as the "Shares." The total
amount of common stock of the Company (the "Common Stock") and other securities
issuable upon conversion of the Shares is hereinafter referred to as the
"Conversion Stock." The Shares and the Conversion Stock are hereinafter
collectively referred to as the "Securities."
2. CLOSING. The closing of the purchase and sale of the Shares hereunder
(the "Closing") shall take place at the offices of Cooley Godward Castro
Huddleson & Tatum, Five Palo Alto Square, Palo Alto, California 94306 on
December 30, 1994 at 1:30 p.m. At the Closing, the Company shall deliver to the
Purchaser a certificate representing the Shares registered in the name of the
Purchaser, dated as of the Closing, against payment of the purchase price
therefor by wire transfer or check in immediately available funds and made
payable to the order of the Company.
1.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to the Purchaser as follows:
(a) All corporate and other action or proceedings on the part of the
Company for the authorization, execution, delivery and performance by the
Company of this Agreement and the Note Agreement, and the consummation by the
Company of the transactions contemplated hereby and thereby, has been duly and
property taken, and this Agreement and the Note Agreement constitute valid and
binding obligations of the Company, enforceable in accordance with their
respective terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' fights. Upon issuance to the Purchaser for the consideration
specified in Section 1 above, the Shares will be duly authorized, validly
issued, fully paid and nonassessable and issued in accordance with applicable
state and federal securities laws. The Company has reserved 2,105,300 shares of
Common Stock for issuance upon conversion of the Shares. The Conversion Stock,
when issued in accordance with the Certificate of Designation, and any shares of
Common Stock issued in accordance with the terms of the Note Agreement (the
"Note Shares"), will be duly authorized, validly issued, fully paid and
nonassessable.
(b) All consents, approvals, orders or authorizations of or
registrations, qualifications, designations, declarations or filings with any
federal, state or local governmental authority required on the part of the
Company to be obtained in connection with the consummation of the transactions
contemplated by this Agreement and the Note Agreement will have been obtained
prior to, and be effective on and as of, the Closing.
(c) The Company has delivered to the Purchaser true and complete
copies of the Company's annual report on Form 10-K for the year ended December
31, 1993, the Company's quarterly reports on Form 10-Q for the quarters ended
March 31, June 30, and September 30, 1994, and the Company's Proxy Statement
dated May 10, 1994 (collectively, the "SEC Reports").
(d) All negotiations relative to this Agreement and the Note
Agreement, and the transactions contemplated hereby and thereby, have been
carried on by the Company directly with the Purchaser and, so far as is known to
the Company, no person acting on behalf of the Company or any affiliate is or
will be entitled to any brokers' or finders' fee or any other similar commission
or reimbursement of expenses directly or indirectly from the Company.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser hereby
represents and warrants to the Company as follows:
(a) All corporate and other action or proceedings on the part of the
Purchaser for the authorization, execution, delivery and performance by the
Purchaser of this Agreement, the Note Agreement, and the consummation by the
Purchaser of the transactions contemplated hereby and thereby, has been duly and
properly taken, and this Agreement and the Note Agreement constitute valid and
binding obligations of the Purchaser, enforceable in accordance
2.
with their respective terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights.
(b) All consents, approvals, orders or authorizations of or
registrations, qualifications, designations, declarations or filings with any
federal, state or local governmental authority required on the part of the
Purchaser to be obtained in connection with the consummation of the transactions
contemplated by this Agreement and the Note Agreement will have been obtained
prior to, and be effective on and as of, the Closing except for the Purchaser's
filing of Schedule 13D with the Securities and Exchange Commission, which shall
be filed within ten days after the Closing.
(c) The Purchaser has received and carefully reviewed the SEC
Reports, together with the Company's Annual Report to Stockholders for the
fiscal year ended December 31, 1993, and has had the opportunity to obtain and
receive such information as it deems necessary to understand the business and
financial condition of the Company and to make the investment decision to
purchase the Shares and enter into the Note Agreement.
(d) All negotiations relative to this Agreement and the Note
Agreement, and the transactions contemplated hereby and thereby, have been
carried on by the Purchaser directly with the Company and so far as is known to
the Purchaser, no person acting on behalf of the Purchaser or any affiliate is
or will be entitled to any brokers' or finders' fees or any other similar
commission or reimbursement of expenses directly or indirectly for the
Purchaser.
5. COMPLIANCE WITH SECURITIES LAWS AND RESTRICTIONS ON TRANSFER OF
SHARES.
(a) The Purchaser hereby represents and warrants to the Company as
follows:
(i) The Purchaser is purchasing the Securities for its own
account for investment only and not with a view to any resale or distribution
thereof, except pursuant to an effective registration statement under the Act
covering the sale, assignment or transfer or an opinion of counsel satisfactory
to the Company that such registration is not required.
(ii) As an investor in companies in the biopharmaceutical
industry and a participant in such industry, the Purchaser has such knowledge
and experience in financial and business matters that it is capable of
evaluating the merits and risks of the investment represented by the Securities,
and it is able to bear the economic risk of such investment.
(iii) The Purchaser understands that the Securities are being
sold in a transaction which is exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Act"), by reason of the provisions of
Section 4(2) of the Act and the rules promulgated thereunder, and that such
Securities will be subject to transfer restrictions and must be held
indefinitely unless subsequently registered under the Act or an exemption from
such registration is available. The certificates representing the Securities
will be affixed with a legend reading as follows:
3.
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED, HYPOTHECATED, ASSIGNED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER SAID ACT COVERING THE TRANSFER OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
(iv) The restrictions on sale, assignment and transfer of
the Securities contained in Section 5(a)(iii) shall terminate at such time as
there shall be delivered to the Company and the Purchaser an opinion of counsel
to the Purchaser, concurred in by counsel to the Company, to the effect that,
due to the lapse of time or otherwise, no registration of the Securities is
required under the Act in connection with any distribution of the Securities to
the public in the United States. In addition, at any time after (A) the delivery
of such opinion; (B) there exists an effective registration statement under the
Act covering the Securities; or (C) the Purchaser shall have delivered to the
Company a written undertaking, executed by the Purchaser and any broker
proposing to execute sales, to the effect that such sales shall be made only in
compliance with all applicable provisions of Rule 144 under the Act (or any
applicable similar rule which may be promulgated from time to time), the
Purchaser shall be entitled to exchange its certificate representing the
Securities (or any portion thereof as to which (A), (B) or (C) above applies)
for new certificates not bearing the legend set forth in Section 5(a)(iii), and
the Company shall promptly remove or cause to be removed the notation
restricting the transfer of such Securities and the stop transfer order referred
to in Section 5(a)(v).
(v) The Purchaser understands that notations restricting
the transfer of the Securities will be made on the transfer records of the
Company and that a stop transfer order will be entered with the Company's
transfer agent.
(b) None of the Securities nor any Note Shares shall be sold,
assigned or transferred except in accordance with the provisions of this Section
5.
(c) The Purchaser may sell, assign or transfer all or a portion of
the Securities or the Note Shares to an affiliate of the Purchaser which agrees
in writing with the Company to comply with all the provisions of this Agreement
applicable to the Purchaser. For the purposes of this Agreement, the term
"affiliate" of the Purchaser means any company or entity that, directly or
indirectly through one or more intermediaries, is controlled by the Purchaser.
(d) Except as provided in Section 5(c), the Purchaser will not
transfer ownership of all or any portion of the Securities except as follows:
the Purchaser shall notify the Company, in writing, of its good faith intention
to promptly transfer ownership of such Securities, specifying the number of
shares. For a period of five business days following receipt by the Company of
such notification, the Company shall have the right to purchase or arrange for
the purchase of all, but not less than all, of the Securities to which such
notice relates. If the Company elects to purchase or arrange for the purchase of
all such Securities, the Company shall so notify the Purchaser and the Company
and the Purchaser shall conclude such purchase
4.
and sale at the price described below within five business days of such
notification. The purchase price per share for such Securities to be purchased
by the Company, on an as-converted to Common Stock basis, shall be equal to the
average closing price of the Company's Common Stock from and including the date
of the Purchaser's written notice of its intention to transfer ownership through
and including the date on which the Company provides written response of its
intention to purchase such shares (but in any case no more than five business
days). If the Company fails to notify the Purchaser of its intention to purchase
such Securities or to arrange for the purchase of such Securities prior to
expiration of five business days from receipt of Purchaser's notice, then,
subject to Sections 5(a)(iii)-(v), the Purchaser shall thereafter have the right
to transfer ownership of such Securities (the "Noticed Shares") to any person or
persons without reoffering the Noticed Shares to the Company for purchase. If a
transfer of ownership of any Noticed Shares occurs more than three months after
the Company's election not to purchase such Noticed Shares, the Purchaser will
advise the Company, for informational purposes only, of the transaction
immediately prior to the sale or transfer.
Notwithstanding the foregoing, with respect to the Securities (but not
the Note Shares), the Purchaser shall not, without the Company's prior approval,
sell to a single third party investor (including affiliates of such investor)
greater than (i) 500,000 Securities in any twelve-month period prior to
December 31, 1996 and (ii) 1,000,000 Securities in any twelve-month period
thereafter (in each case calculated on an as-converted basis), except pursuant
to a tender offer approved by the Company's board of directors. The foregoing
volume limitation shall not be deemed to preclude the Purchaser from selling
stock in excess of such 500,000 and 1,000,000 share limits to a broker or dealer
who agrees to abide by such limits in connection with the resale of Securities
to a single third party investor. In addition, the foregoing volume limitation
shall terminate upon the issuance of any Note Shares.
(e) The obligations of Section 5(d) shall terminate upon the earlier
of (i) December 30, 2002, (ii) the date on which the Purchaser, together with
its affiliates, no longer holds securities representing or convertible into at
least 3% of the outstanding voting equity securities of the Company or (iii) the
closing of a merger or similar transaction pursuant to which greater than 50% of
the Company's voting stock is transferred to a stockholder or group of
stockholders, or a sale of all or substantially all of the assets.
6. CONDITIONS TO CLOSING.
(a) CONDITIONS TO PURCHASER'S OBLIGATIONS AT THE CLOSING. The
Purchaser's obligation to purchase the Shares at the Closing is subject to the
fulfillment on or prior to the Closing Date of the following conditions, any of
which may be waived in whole or in part by the Purchaser:
(i) The Company shall have filed the Certificate of
Designation with the Delaware Secretary of State, as evidenced by a copy of the
Certificate of Designation, file-stamped by the Delaware Secretary of State.
5.
(ii) At the Closing, the purchase of the Shares by the
Purchaser hereunder shall be legally permitted by all laws and regulations to
which the Purchaser or the Company is subject.
(iii) The Company shall have executed the Collaboration
Agreement and the Note Agreement.
(b) CONDITIONS TO COMPANY'S OBLIGATIONS AT THE CLOSING. The Company's
obligation to sell and issue the Shares at the Closing is subject to the
fulfillment on or prior to the Closing Date of the following conditions, any of
which may be waived in whole or in part by the Company:
(i) The Company shall have filed the Certificate of
Designation with the Delaware Secretary of State.
(ii) At the Closing, the purchase of the Shares by the
Purchaser hereunder shall be legally permitted by all laws and regulations to
which the Purchaser or the Company is subject.
(iii) The Purchaser shall have executed the Collaboration
Agreement and the Note Agreement.
7. ADDITIONAL STOCK PURCHASES BY PURCHASER. The Purchaser represents and
warrants to the Company that prior to the Closing it holds 100,000 shares of
Common Stock of the Company and that as of the Closing it is purchasing the
Shares for investment and not with the intention of acquiring the Company or
making the Company a subsidiary of the Purchaser. In light of such
representations and in consideration of the Purchaser's opportunity to purchase
Preferred Stock from the Company pursuant to the terms of this Agreement, the
Purchaser agrees that prior to December 30, 1999, neither the Purchaser nor any
affiliate of the Purchaser nor anyone acting on its or their behalf will acquire
any equity securities of the Company without the Company's prior written
approval, except as contemplated under the Note Agreement. The obligations of
this Section 7 shall terminate upon the Company's receipt of a firm offer from a
third party to acquire greater than 50% of the Company's voting stock or all or
substantially all of the Company's assets.
8. REGISTRATION RIGHTS.
(a) CERTAIN DEFINITIONS. As used in this Agreement, the following
terms shall have the following respective meanings:
"COMMISSION" shall mean the Securities and Exchange Commission or any
federal agency at the time administering the Act.
6.
"ACT" shall mean the Securities Act of 1933, as amended, or any
similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"REGISTRABLE SECURITIES" shall mean (i) any Conversion Stock issued to
the Purchaser upon conversion of the Shares, (ii) the Note Shares and (iii) any
Common Stock of the Company issuable in respect of the Shares, the Conversion
Stock or Note Shares as a result of any stock split, stock dividend,
recapitalization.
The terms "REGISTER", "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration statement on Form
S-3 (or if no such registration is then available, then on Form S-1 or such
other Form as is available) in compliance with the Act, and the declaration or
ordering of the effectiveness of such registration statement.
"REGISTRATION EXPENSES" shall mean all expenses incurred by the
Company in complying with Section 8(b) hereof, including, without limitation,
all registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
and the expense of any special audits incident to or required by any such
registration (but excluding the compensation of regular employees of the Company
which shall be paid in any event by the Company).
"HOLDER" shall mean the Purchaser or an affiliate of the Purchaser
which is a holder of the Shares or Conversion Stock issued pursuant to this
Agreement or the Note Agreement.
"AFFILIATE" shall mean any corporation or other entity or person that
controls, is controlled by, or is under common control with the Holder.
(b) REQUESTED REGISTRATION. In case the Company shall receive from a
Holder a written request that the Company effect registration with respect to
all or a part of the Registrable Securities, the Company will as soon as
practicable, use its diligent best efforts to effect such registration
(including, without limitation, the execution of an undertaking to file
post-effective amendments, appropriate qualification under applicable blue sky
or other state securities laws and appropriate compliance with applicable
regulations issued under the Act and any other governmental requirements or
regulations) as may be so requested and as would permit or facilitate the sale
and distribution of all or such portion of such Registrable Securities as are
specified in such request, provided that the Company shall not be obligated to
take any action to initiate any such registration, qualification or compliance
pursuant to this Section 8(b) in any particular jurisdiction in which the
Company would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Act.
7.
Notwithstanding the foregoing, the Holder's right to request, and the
Company's obligation to initiate, such a registration shall be limited as
follows:
(i) The Holder may request an initial registration covering
up to forty percent (40%) of the Registrable Securities other than Note Shares
at any time following the date of this Agreement;
(ii) The Holder may request a second registration covering
up to one-half of the Registrable Securities not then registered at any time on
or after December 15, 1995;
(iii) The Holder may request a third registration covering
the remaining Registrable Securities not then registered at any time on or after
March 15, 1996; and
(iv) If the Company issues Note Shares to the Holder, the
Holder may request an additional registration covering the Note Shares at any
time after the issuance of the Note Shares.
Subject to the foregoing clauses in this Section 8(b), the Company
shall file a registration statement covering the Registrable Securities so
requested to be registered as soon as practicable, after receipt of the request
or requests of the Holder. In the case of a registration statement on Form S-3,
the Company shall use diligent efforts to (i) prepare and file such registration
statement within 15 days of its receipt of the Holder's written request that the
Company effect a registration and (ii) cause such registration statement to
become effective as soon as practicable. In addition, the registration
statement filed by the Company with the Commission shall cover the Shares if,
but only if, such registration is required by the Commission in order to effect
a registration of the Registrable Securities underlying such Shares.
(c) EXPENSES OF REGISTRATION. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to this
Agreement shall be borne by the Holder, except that in the case of a
registration on Form S-3, the Registration Expenses borne by the Holder,
exclusive of registration fees (including fees payable to the Commission and to
the National Association of Securities Dealers or any securities exchange on
which the Company's Common Stock is then traded) shall not exceed $20,000.
(d) REGISTRATION PROCEDURES. In the case of each registration,
qualification or compliance effected by the Company pursuant to this Agreement,
the Company will keep Holder advised in writing as to the initiation of each
registration, qualification and compliance and as to the completion thereof.
The Company will:
(i) Use diligent efforts to keep such registration,
qualification or compliance effective for such period of time, not to exceed
eight years, as may be necessary to permit the Holder to complete the
distribution described in the registration statement relating thereto;
8.
(ii) Respond promptly to any comments of the Commission
related to the registration statement and promptly prepare and file such
amendments and supplements to the registration statement and related prospectus
as may be necessary to comply with the provisions of the Act and to keep such
registration statement effective for the period of time specified in Section
8(d)(i);
(iii) Cause the Registrable Securities included in such
registration to be registered on such securities exchange or over the counter
market on which the Company's Common Stock is then traded; and
(iv) Furnish such number of prospectuses and other documents
incident thereto as the Holder from time to time may reasonably request.
(e) TERMINATION OF REGISTRATION RIGHTS. The registration rights
granted pursuant to this Agreement shall terminate at the time at which all of
the Registrable Securities can be sold within a given three-month period without
compliance with the registration requirements of the Act pursuant to Rule 144 or
other applicable exemption supported by a written opinion of legal counsel for
the Company which shall be reasonably satisfactory in form and substance to
legal counsel for Holder; provided, however, that in no event shall the
registration rights granted pursuant to this Agreement terminate while Note
Shares may be issued pursuant to the terms of the Note Agreement.
(f) INDEMNIFICATION.
(i) The Company will indemnify a Holder, each of its
officers and directors, and each person controlling such Holder, with respect to
which registration, qualification or compliance has been effected pursuant to
this Agreement and each underwriter, if any, and each person who controls any
underwriter, against all expenses, claims, losses, damages and liabilities (or
actions in respect thereof), arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any registration
statement, prospectus, offering circular or other document (including any
related registration statement, notification or the like) incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading, or any violation by the Company of any rule or
regulation promulgated under the Act applicable to the Company and relating to
action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each such Holder
and each of its officers and directors, for any legal and any other expenses
reasonably incurred in connection with investigating, preparing or defending any
such claim, loss, damage, liability or action, provided that the Company will
not be liable in any such case to the extent that any such claim, loss, damage,
liability or expenses arises out of or is based on any untrue statement or
omission based upon written information furnished to the Company by an
instrument duly executed by such Holder and stated to be specifically for use
therein.
9.
(ii) A Holder will indemnify the Company, each of its
directors and officers, each legal counsel and independent accountant of the
Company, each underwriter, if any, of the Company securities covered by such a
registration statement, and each person who controls the Company within the
meaning of the Act, against all claims, losses, damages and liabilities (or
actions in respect thereof) arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any such registration
statement, prospectus, offering circular or other document, or any omission (or
alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
the Company, such directors, officers, persons, or control persons for any legal
or any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, each case to the
extent, but only to the extent, that such untrue statement (or alleged omission)
is made in such registration statement, prospectus, offering circular or other
document in reliance upon and in conformity with written information furnished
to the Company in an instrument duly executed by such Holder and stated to be
specifically for use therein; provided, however, that the obligations of such
Holder thereunder shall be limited to an amount equal to the value of the
Registrable Securities at the time of their issuance.
(iii) Each party entitled to indemnification under this
Agreement (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that the Indemnified
Party may participate in such defense at such party's expense, and provided
further that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the Indemnifying Party of its obligations under this
Agreement. No Indemnifying Party, in the defense of any such claim or
litigation, except with the consent of each Indemnified Party, shall 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 such
Indemnified Party of a release from all liability in respect to such claim or
litigation.
(g) INFORMATION BY HOLDER. The Holder of Registrable Securities
included in any registration shall furnish to the Company such information
regarding such Holder and any distribution proposed by such Holder as the
Company may request in writing and as shall be required in connection with any
registration, qualification or compliance referred to in this Agreement.
(h) RULE 144 REPORTING. With a view to making available to the
Holder the benefits of certain rules and regulations of the Commission which may
permit the sale of the Registrable Securities to the public without
registration, the Company agrees to use diligent efforts to (a) make and keep
public information available, as those terms are understood and defined in the
Commission's Rule 144, at all times, and (b) file with the Commission in a
timely manner all reports and other documents required of the Company under the
Securities Exchange Act of 1934, as amended.
10.
9. RULE 144A. Upon the Purchaser's request, the Company will promptly
provide such information and take such other actions as may reasonably be
requested by the Purchaser in order to enable the Purchaser to effect a transfer
of Securities and/or Note Shares pursuant to Rule 144A promulgated under the
Act.
10. NOTICES. All notices and other communication required or appropriate
to be given hereunder shall be in writing and shall be delivered by hand or
mailed by certified mail, return receipt requested, or sent by telex or
facsimile (in which case a confirming copy shall also be sent by certified mail
or courier), to the following respective addresses or to such other addresses as
may be specified in any notice delivered or mailed as above provided:
(a) If to the Purchaser, to:
Genentech, Inc.
460 Point San Bruno Boulevard
South San Francisco, CA 94080
Telephone: (415) 225-1000
Facsimile: (415) 952-9881
Attention: Corporate Secretary
(b) If to the Company, to:
Scios Nova Inc.
2450 Bayshore Parkway
Mountain View, CA 94043
Telephone: (415) 966-1550
Facsimile: (415) 962-5816
Attention: General Counsel
Any notice or other communication delivered by hand or mailed shall be deemed to
have been delivered on the date on which such notice or communication is
delivered by hand, or in the case of certified mail deposited with the
appropriate postal authorities on the date when such notice or communication is
actually received, and in any other case shall be deemed to have been delivered
on the date on which such notice or communication is actually received.
11. GOVERNING LAW. The parties have agreed that this Agreement will be
governed by and construed in accordance with the laws of the State of
California.
11.
12. AMENDMENTS, ASSIGNMENT. No provision of this Agreement may be waived,
changed or modified, or the discharge thereof acknowledged orally, but only by
an agreement in writing signed by the party against which the enforcement of any
waiver, change, modification or discharge is sought. None of the rights or
obligations of the parties hereto may be assigned or transferred without the
written consent of the other parties hereto, except that the Purchaser may
assign its rights and obligations to an affiliate which agrees, prior to the
transfer, in writing with the Company to comply with all the provisions of this
Agreement applicable to the Purchaser.
13. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
14. ENTIRE AGREEMENT. This Agreement and the Note Agreement constitute the
entire contract between the parties with respect to the subject matter hereof
and thereof, and no party will be liable or bound to the other in any manner by
any representations, warranties or covenants except as specifically set forth
herein and therein.
15. TERM AND TERMINATION. This Agreement is effective as of the date first
written above and, except as otherwise expressly provided herein, will continue
in effect as to the Purchaser for so long as the Purchaser holds any shares of
Common Stock of the Company unless earlier terminated by mutual written consent
of both parties.
16. TITLES. The titles of the Sections of this Agreement are inserted for
reference only, and are not to be considered as part of this Agreement in
construing this Agreement.
12.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
"THE COMPANY" SCIOS NOVA INC.
By /s/ Richard L. Casey
------------------------------------
Richard L. Casey
Chairman and Chief Executive Officer
"THE PURCHASER" GENENTECH, INC.
By /s/ G. Kirk Raab
-----------------------------------
G. Kirk Raab
President and Chief Executive Officer
13.
EXHIBIT A
CERTIFICATE OF DESIGNATION
OF
SERIES A PREFERRED STOCK
OF
SCIOS NOVA INC.
(Pursuant to Section 151 of the
Delaware General Corporation Law)
SCIOS NOVA INC., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), hereby certifies
that the following resolution was adopted on December 21, 1994 at a duly held
meeting of the Board of Directors of the Corporation as required by Section 151
of the General Corporation Law:
RESOLVED, that pursuant to the authority granted to and vested in
the Board of Directors of the Corporation in accordance with the
provisions of its Certificate of Incorporation, the Board of Directors
hereby creates a series of Preferred Stock, par value $.001 per share,
of the Corporation and hereby states the designation and number of
shares, and fixes the relative powers, preferences, rights,
qualifications, limitations and restrictions thereof (in addition to
the provisions set forth in the Certificate of Incorporation of the
Corporation, which are applicable to the Preferred Stock of all
classes and series), as follows:
Series A Preferred Stock:
SECTION 1. DESIGNATION AND AMOUNT. Twenty One Thousand Fifty-
Three (21,053) shares of Preferred Stock, $.001 par value, are
designated "Series A Preferred Stock" with the powers, preferences,
rights, qualifications, limitations and restrictions specified herein
(the "Series A Preferred Stock"). Such number of shares may be
increased or decreased by resolution of the Board of Directors;
PROVIDED, that no decrease shall reduce the number of shares of Series
A Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or upon the
conversion of any outstanding securities issued by the Corporation
convertible into Series A Preferred Stock.
1.
SECTION 2. DIVIDENDS. No dividends (other than those payable
solely in the Common Stock of the Corporation) shall be paid on any
Common Stock of the Corporation unless a dividend is paid with respect
to all outstanding shares of Series A Preferred Stock in an amount for
each such share of Series A Preferred Stock equal to or greater than
the aggregate amount of such dividends payable upon all shares of
Common Stock into which such share of Series A Preferred Stock could
then be converted.
SECTION 3. LIQUIDATION, DISSOLUTION OR WINDING UP. Upon any
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, before any payment shall be made to the
holders of shares of the Common Stock of the Corporation, the holders
of shares of Series A Preferred Stock shall be entitled to receive
$950.00 per share of Series A Preferred Stock then held by such
holders, plus an amount equal to declared and unpaid dividends and
distributions thereon. After payment of the full liquidation
preference of the Series A Preferred Stock set forth in the preceding
sentence, the assets of the Corporation legally available for
distribution, if any, shall be distributed ratably to the holders of
the Common Stock. Any consolidation or merger of the Corporation with
or into any other corporation or other entity or person, or any other
corporate reorganization, in which the shareholders of the Corporation
immediately prior to such consolidation, merger or reorganization, own
less than 50% immediately after such consolidation, merger or
reorganization, or any transaction or series of related transactions
in which in excess of fifty percent (50%) of the Corporation's voting
power is transferred, shall be considered a liquidation under this
Section 3.
SECTION 4. VOTING RIGHTS. The holders of shares of Series A
Preferred Stock shall not have any voting rights, except as required
under the General Corporation Law of Delaware.
SECTION 5. CONVERSION.
(A) RIGHT TO CONVERT. Each share of Series A Preferred Stock
shall be convertible, at the option of the holder thereof, into that
number of shares of the Common Stock of the Corporation as determined
by dividing $950.00 by the Conversion Price, determined as provided
below, in effect on the date the certificate for such share is
surrendered for conversion. The Conversion Price for the Series A
Preferred Stock shall initially be $9.50 per share. The number of
shares of Common Stock into which a share of Series A Preferred Stock
is convertible is hereinafter referred to as the "Conversion Rate" of
such series.
(B) AUTOMATIC CONVERSION. Each share of Series A Preferred Stock
shall automatically be converted into shares of Common Stock at its then
effective Conversion Rate immediately upon the transfer of ownership by the
initial holder to a third party which is not an Affiliate of such holder.
For purposes hereunder,
2.
"Affiliate shall mean a party that, directly or indirectly, through one or more
intermediaries, controls or is controlled by such holder.
(C) MECHANICS OF CONVERSION. Each holder of Series A Preferred
Stock who desires to convert the same into shares of Common Stock
pursuant to this Section 5 shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation
or any transfer agent for the Series A Preferred Stock, and shall give
written notice to the Corporation at such office that such holder
elects to convert the same; provided, however, that in the event of an
automatic conversion pursuant to Section 5(B), the outstanding shares
of Series A Preferred Stock shall be converted automatically without
any further action by the holder of such shares and whether or not the
certificates representing such shares are surrendered to the
Corporation or its transfer agent, and provided further that the
Corporation shall not be obligated to issue certificates evidencing
the shares of Common Stock issuable upon such automatic conversion
unless the certificates evidencing such shares of Series A Preferred
Stock are delivered to the Corporation or its transfer agent as
provided herein. Such notice shall state the number of shares of
Series A Preferred Stock being converted. Thereupon, the Corporation
shall promptly issue and deliver at such office to such holder a
certificate or certificates for the number of shares of Common Stock
to which such holder is entitled and shall promptly pay in cash or, to
the extent sufficient funds are not then legally available therefor,
in Common Stock (at the Common Stock's fair market value determined by
the Board of Directors as of the date of such conversion), any
declared and unpaid dividends on the shares of Series A Preferred
Stock being converted. Such conversion shall be deemed to have been
made at the close of business on the date of such surrender of the
certificates representing the shares of Series A Preferred Stock to be
converted, or in the case of automatic conversion on the date of
transfer to the new holder, and the person entitled to receive the
shares of Common Stock issuable upon such conversion shall be treated
for all purposes as the record holder of such shares of Common Stock
on such date.
(D) ADJUSTMENT FOR SUBDIVISIONS AND COMBINATIONS. If the
Corporation shall at any time or from time to time after the date that
the first share of Series A Preferred Stock is issued (the "Original
Issue Date") effect a subdivision of the outstanding Common Stock, the
Conversion Price in effect immediately before that subdivision shall
be proportionately decreased. Conversely, if the Corporation shall at
any time or from time to time after the Original Issue Date combine
the outstanding shares of Common Stock into a smaller number of
shares, the Series A Conversion Price in effect immediately before the
combination shall be proportionately increased. Any adjustment under
this Section 5(D) shall become effective at the close of business on
the date the subdivision or combination becomes effective.
3.
(E) ADJUSTMENT FOR CERTAIN DIVIDENDS AND DISTRIBUTIONS. If the
Corporation at any time or from time to time after the Original Issue
Date makes, or fixes a record date for the determination of holders of
Common Stock entitled to receive, a dividend or other distribution
payable in additional shares of Common Stock, in each such event the
Conversion Price that is then in effect shall be decreased as of the
time of such issuance or, in the event such record date is fixed, as
of the close of business on such record date, by multiplying the
Conversion Price then in effect by a fraction (1) the numerator of
which is the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the
close of business on such record date, and (2) the denominator of
which is the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the
close of business on such record date plus the number of shares of
Common Stock issuable in payment of such dividend or distribution;
provided, however, that if such record date is fixed and such dividend
is not fully paid or if such distribution is not fully made on the
date fixed therefor, the Conversion Price shall be recomputed
accordingly as of the close of business on such record date and
thereafter the Conversion Price shall be adjusted pursuant to this
Section 5(d) to reflect the actual payment of such dividend or
distribution.
(F) ADJUSTMENT FOR OTHER DIVIDENDS AND DISTRIBUTIONS. If the
Corporation at any time or from time to time after the Original Issue
Date makes, or fixes a record date for the determination of holders of
Common Stock entitled to receive, a dividend or other distribution
payable in securities of the Corporation other than shares of Common
Stock, in each such event provision shall be made so that the holders
of the Series A Preferred Stock shall receive upon conversion thereof,
in addition to the number of shares of Common Stock receivable
thereupon, the amount of other securities of the Corporation which
they would have received had their Series A Preferred Stock been
converted into Common Stock on the date of such event and had they
thereafter, during the period from the date of such event to and
including the conversion date, retained such securities receivable by
them as aforesaid during such period, subject to all other adjustments
called for during such period under this Section 5 with respect to the
rights of the holders of the Series A Preferred or with respect to
such other securities by their terms.
(G) ADJUSTMENT FOR RECAPITALIZATIONS, ETC. If at any time or
from time to time after the Original Issue Date, the Common Stock
issuable upon the conversion of the Series A Preferred Stock is
changed into the same or a different number of shares of any class or
classes of stock, whether by recapitalization, reclassification or
otherwise (other than a subdivision or combination of shares or stock
dividend or a reorganization, merger, consolidation or sale of assets
provided for elsewhere in this Section 5 or in Section 3), in any such
event each holder of Series A Preferred shall have the right
thereafter to convert such stock into the kind and amount of stock and
other securities and property receivable upon such
4.
recapitalization, reclassification or other change by holders of the
maximum number of shares of Common Stock into which such shares of Series A
Preferred could have been converted immediately prior to such
recapitalization, reclassification or change, all subject to further
adjustment as provided herein or with respect to such other securities or
property by the terms thereof.
SECTION 6. REACQUIRED SHARES. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their cancellation
become authorized but unissued shares of Preferred Stock and may be
reissued as part of a new series of Preferred Stock subject to the
conditions and restrictions on issuance set forth herein, in the
Restated Certificate of Incorporation, or in any other Certificate of
Designation creating a series of Preferred Stock or any similar stock
or as otherwise required by law.
SECTION 7. CONSOLIDATION, MERGER, ETC. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash and/or any other
property, then in any such case the Corporation shall give each holder
of shares of Series A Preferred Stock notice of such transaction and
the details of such exchange at least fifteen days before the closing
of such transaction, and each such holder shall have the right to
convert such shares of Series A Preferred Stock into shares of Common
Stock of the Corporation prior to such closing, or to receive in such
transaction the amount of the liquidation preference set forth in
Section 3, in the form of the other stock or securities, cash and/or
other property as is received by the holders of the Common Stock.
IN WITNESS WHEREOF, the undersigned have executed this certificate as of
December 28, 1994.
/s/ Richard L. Casey
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Richard L. Casey
President and Chief Executive Officer
/S/ JOHN H. NEWMAN
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John H. Newman
Secretary
5.