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Exhibit 17(c)
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
ALLERGAN LIGAND RETINOID THERAPEUTICS, INC.
ALLERGAN LIGAND RETINOID THERAPEUTICS, INC., a corporation duly
organized and existing under the laws of the State of Delaware (the
"Corporation"), hereby certifies as follows:
1. The original Certificate of Incorporation of the Corporation was
filed with the Secretary of State of the State of Delaware on December 16, 1994.
2. This Restated Certificate of Incorporation restates and integrates
and amends the provisions of the Certificate of Incorporation of the
Corporation.
3. Pursuant to Section 245 of the General Corporation Law of the State
of Delaware, the text of the Certificate of Incorporation of the Corporation is
hereby amended and restated to read in its entirety as follows:
ARTICLE I
NAME
The name of the Corporation is Allergan Ligand Retinoid Therapeutics,
Inc.
ARTICLE II
REGISTERED OFFICE AND REGISTERED AGENT
The address of the registered office of the Corporation in the State of
Delaware is 1050 S. State Street, City of Dover, County of Kent 19901. The name
of the registered agent of the Corporation at such address is CorpAmerica, Inc.
ARTICLE III
CORPORATE PURPOSE
The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware (the "General Corporation Law").
ARTICLE IV
CAPITAL STOCK
SECTION 4.1. AUTHORIZED SHARES. The Corporation is authorized to issue
two classes of stock, one of which shall be known as Callable Common Stock and
the other of which shall be known as Special Common Stock. The total number of
shares of all classes of stock that the Corporation shall have authority to
issue is 3,251,000. The total number of shares of Callable Common Stock which
the Corporation is authorized to issue is 3,250,000. The par value of each share
of Callable Common Stock shall be $.001. The total number of shares of Special
Common Stock which the Corporation is authorized to issue is 1,000. The par
value of each share of Special Common Stock shall be $1.00. The authorized and
outstanding shares of Common Stock of the Corporation as of the date of this
Amended and Restated Certificate of Incorporation are hereby renamed Special
Common Stock.
SECTION 4.2. DIVIDENDS. Subject to Section 4.4(c) hereof, the holders
of Callable Common Stock are entitled to receive dividends when, as and if
declared by the Board of Directors of the Corporation out of funds legally
available therefor. No dividends are payable on or with respect to the Special
Common Stock, and other than as set forth in Section 4.3, the holders of Special
Common Stock are not otherwise entitled to participate in any way in the profits
or assets of the Corporation.
SECTION 4.3. LIQUIDATION. In the event of the liquidation, dissolution
or winding up of the Corporation, holders of Callable Common Stock have a
priority over the holders of the Special Common Stock with respect to return of
capital.
SECTION 4.4. VOTING RIGHTS OF STOCKHOLDERS. (a) Each holder of Callable
Common Stock shall have one vote for each share standing in his or her name on
all matters submitted to a vote of holders of the common shares. The holders of
Special
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Common Stock shall only be entitled to vote as required by law or as set forth
in this Section 4.4. In such instances, each holder of Special Common Stock
shall have one vote for each share standing in his or her name. The
determination of a quorum shall be based upon the presence of shares
representing fifty percent (50%) of the voting power of each class of stock of
the Corporation entitled to vote on the matter being voted on.
(b) In any election of directors of the Corporation, the holders of the
Special Common Stock, voting as a separate class, shall be entitled to elect two
directors (each a "Special Common Stock Director"). The right of the holders of
Special Common Stock, voting separately as a class, to elect members of the
Board of Directors of the Corporation as aforesaid shall continue until the
earliest of (i) the exercise of the Stock Purchase Option (as defined in Article
V), (ii) the Stock Purchase Option Expiration Date (as defined in Article V) and
(iii) the date of termination of the Stock Purchase Option with respect to both
Ligand and Allergan pursuant to Section 5.10(a) hereof, at which time such right
shall terminate.
(c) The Corporation shall not, without the affirmative vote of the
holders of a majority of the issued and outstanding shares of Special Common
Stock, voting separately and as a class: (i) issue any additional shares of
capital stock through a stock split, sale, reorganization or otherwise; (ii)
alter or change the rights, powers, preferences and restrictions of the Special
Common Stock, (iii) alter, change or amend Articles IV or VI of this Certificate
of Incorporation, (iv) merge, consolidate or reorganize the Corporation with or
into any other corporation, (v) sell, liquidate or otherwise dispose of all or
substantially all of the assets of the Corporation, (vi) borrow an aggregate of
in excess of $1,000,000 outstanding at any one time; (vii) declare or pay
dividends or make any other distributions to stockholders; or (viii) adopt,
amend or repeal the Bylaws of the Corporation. The affirmative vote of a
majority of the issued and outstanding shares of Special Common Stock required
by this Section 4.4(c) shall continue until the earliest of (A) the exercise of
the Stock Purchase Option, (B) the Stock Purchase Option Expiration Date and (C)
the date of termination of the Stock Purchase Option with respect to both Ligand
and Allergan pursuant to Section 5.10(a) hereof, at which time such requirement
will terminate.
(d) Except in connection with a permitted assignment by Ligand or
Allergan of its respective rights and obligations under the Stock Purchase
Obligation pursuant to Sections 5.8(ii) and (iii) hereof, respectively, no
holder of shares of Special Common Stock may transfer or sell any or all of such
shares to any person or entity without the affirmative vote of the holders of a
majority of the issued and outstanding shares of Callable Common Stock and the
affirmative vote of the holders of a majority of the issued and outstanding
shares of Special Common Stock. The affirmative vote of a majority of the issued
and outstanding shares of Callable Common Stock and the affirmative vote of a
majority of the issued and outstanding shares of Special Common Stock required
by this Section 4.4(d) shall continue until the earliest of (i) the exercise of
the Stock Purchase Option, (ii) the Stock Purchase Option Expiration Date and
(iii) the date of termination of the Stock Purchase Option with respect to both
Ligand and Allergan pursuant to Section 5.10(a) hereof, at which time such
requirement will terminate.
SECTION 4.5. REDEMPTION OF SPECIAL COMMON STOCK. (a) The Corporation
may, from time to time on and after the earliest of (i) the exercise of the
Stock Purchase Option, (ii) the Stock Purchase Option Expiration Date and (iii)
the date of termination of the Stock Purchase Option with respect to both Ligand
and Allergan pursuant to Section 5.10(a) hereof, redeem all of the outstanding
shares of Special Common Stock by paying in cash $1.00 per share on each
redeemed share (the "Redemption Price"). At least 15 days before the date of
redemption, a written redemption notice shall be given to each holder of Special
Common Stock by first-class mail, postage prepaid, at the holder's address as
shown on the Corporation's records, stating: (i) all the shares of Special
Common Stock are to be redeemed, (ii) the date fixed for redemption (the
"Redemption Date"), (iii) the Redemption Price, and (iv) the place of payment of
the Redemption Price.
(b) On or before the date fixed for redemption, each holder of shares
of Special Common Stock to be redeemed shall surrender the certificates
representing these shares to the Corporation at the place designated for payment
in the redemption notice and shall then be entitled to receive payment of the
Redemption Price.
(c) If the redemption notice is given in the manner provided in this
Article IV, and if on the Redemption Date the Redemption Price is available for
payment, whether or not the certificates covering these shares are surrendered,
all rights with respect to the redeemable shares shall terminate except the
right of the holders to receive the Redemption Price without interest on the
surrender of the certificates.
ARTICLE V
STOCK PURCHASE OPTION
SECTION 5.1. GRANT OF OPTION. In connection with the offering of rights
(the "Rights") to acquire units (the "Units") pursuant to the Registration
Statement on Forms S-1/S-3 Nos. 33-87598 and 33-87600 (the "Registration
Statement") filed by the
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Corporation and Ligand Pharmaceuticals Incorporated, a Delaware corporation
("Ligand"), with the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended (the "Securities Act"), each Unit
consisting of one share of Callable Common Stock of the Corporation and two
warrants, each to purchase one share of Common Stock, $.001 par value, of Ligand
(the "Ligand Common Stock"), Ligand and in the event not exercised by Ligand,
Allergan, Inc., a Delaware corporation ("Allergan"), will be granted by the
holders of shares of Callable Common Stock in consideration of those certain
cash contributions referred to below to be made by each of Ligand and Allergan
to the Corporation, an exclusive irrevocable option (the "Stock Purchase
Option") to purchase all, but not less than all, the issued and outstanding
shares of Callable Common Stock of the Corporation on the terms and conditions
set forth herein. In connection with the offering of the Rights, Ligand will
contribute $17,500,000 to the Corporation (for every one dollar under
$32,500,000, the maximum proceeds of the offering of the Rights, not realized by
the Corporation pursuant to subscriptions for Units by holders of Rights, Ligand
will increase its contribution by one dollar up to a maximum $18,500,000) (the
"Ligand Contribution") and Allergan will contribute $50,000,000 to the
Corporation (the "Allergan Contribution," and together with the Ligand
Contribution, the "Contributions"). Subject to Section 5.13 hereof, the Stock
Purchase Option may be exercised at any time during the period beginning on the
earlier of (a) June 3, 1997 and (b) the date (the "Statement Date") the
Corporation provides Ligand and Allergan with quarterly financial statements of
the Corporation showing Available Funds (as defined in this Section 5.1 below)
of less than $10,000,000, and ending at 11:59 p.m., San Diego time, on the date
(the "Stock Purchase Option Expiration Date") which is the earliest to occur of
(i) June 3, 2000, (ii) the 90th day after the Statement Date, and (iii) the date
of termination by the Corporation of the Technology License Agreement (the
"Technology License Agreement") pursuant to Section 9.5 thereof (subject to
Section 9.6 thereof), the Research and Development Agreement (the "Research and
Development Agreement") pursuant to Section 11.5 thereof (subject to Section
11.6 thereof) or the Commercialization Agreement (the "Commercialization
Agreement") pursuant to Section 12.5 thereof (subject to Section 12.6 thereof),
each such agreement being among the Corporation, Allergan and Ligand and dated
on or about June 3, 1995 (such period during which the Stock Purchase Option may
be exercised being referred to herein as the "Stock Purchase Exercise Period");
provided, that the Statement Date will be deemed not to have occurred with
respect to any one or more quarterly financial statement delivered pursuant to
clause (b) of this sentence if (x) with respect to any Statement Dates prior to
June 3, 1998, within 15 days thereafter, the Corporation receives a written
commitment from Allergan and Ligand, in form and substance satisfactory to a
majority of the directors of the Corporation that are elected by the holders of
the Callable Common Stock, to make a cash advance (the "Quarterly
Contributions") in an amount considered sufficient by the Board of Directors of
the Corporation, and consistent with the budget and workplans then in effect, to
allow the Corporation to continue research and development under the Research
and Development Agreement for the three months subsequent to such Statement
Date, or (y) with respect to a Statement Date after June 2, 1998 and prior to
June 3, 1999, within 15 days thereafter the Corporation receives a written
commitment from Allergan and Ligand, in form and substance satisfactory to a
majority of the directors of the Corporation that are elected by the holders of
the Callable Common Stock, to make a cash advance of not less than $10,000,000
(such amount, together with the Quarterly Contributions, the "Additional
Contributions") for use in research and development under the Research and
Development Agreement, and in each case Allergan and Ligand fund such cash
advance within 15 days after such written commitment is received by the
Corporation; provided, further, that in no event will the Stock Purchase Option
be exercisable, except with respect to the exercise of the Stock Purchase Option
pursuant to Section 5.13 hereof, prior to June 3, 1998 unless the Available
Funds of the Corporation are less than $60,000,000 on the date of exercise
thereof. If the Stock Purchase Option Expiration Date is not a Business Day (as
defined in this Section 5.1 below), then the Stock Purchase Option Expiration
Date shall be 11:59 p.m., San Diego time, on the next succeeding Business Day.
"Business Day" shall mean any day, other than a Saturday, Sunday or any other
day on which banking institutions in San Diego, California are authorized or
required by law, regulation or executive order to be closed. "Available Funds"
shall mean the sum of (i) the net proceeds to the Corporation from the sale of
the Units, plus (ii) the Contributions, plus (iii) the Additional Contributions,
plus (iv) if designated by ALRT, any licensing or marketing income earned by
ALRT, plus (v) interest and other income earned through temporary investment of
the amounts described in clauses (i), (ii), (iii) and (iv) of this sentence
pending their expenditure, less the sum of (a) all general and administrative
expenses of the Corporation, including those paid pursuant to the Services
Agreement dated on or about June 3, 1995 among the Corporation, Allergan and
Ligand (the "Services Agreement"), plus (b) any other amounts paid to Allergan
or Ligand or authorized Third Party contractors under the Research and
Development Agreement, the Technology License Agreement or the Commercialization
Agreement, plus (c) $1,000,000 to be retained by the Corporation as working
capital. Any proceeds received by ALRT from Allergan and Ligand upon exercise of
the 1057 Purchase Option pursuant to the 1057 Purchase Option Agreement (the
"1057 Purchase Option Agreement") shall be excluded from Available Funds.
SECTION 5.2. STOCK PURCHASE OPTION EXERCISE PRICE. Upon exercise of the
Stock Purchase Option, Ligand or Allergan, as the case may be, shall pay an
exercise price per share (the "Stock Purchase Option Exercise Price") in
accordance with the following schedule:
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Stock Purchase Option
Exercise Price Per Share
of Callable Common
If the Stock Purchase Option Is Exercised Stock
- ---------------------------------------------------------------------------------------------- -----------------------
Before June 3, 1998............................................................................ $21.97
On or after June 3, 1998 and before September 3, 1998.......................................... $23.62
On or after September 3, 1998 and before December 3, 1998...................................... $25.27
On or after December 3, 1998 and before March 3, 1999.......................................... $26.91
On or after March 3, 1999 and before June 3, 1999.............................................. $28.56
On or after June 3, 1999 and before September 3, 1999.......................................... $30.70
On or after September 3, 1999 and before December 3, 1999...................................... $32.85
On or after December 3, 1999 and before March 3, 2000.......................................... $34.99
On or after March 3, 2000 and before June 3, 2000.............................................. $37.13
SECTION 5.3. FORM OF PAYMENT. (i) Payment by Ligand. If Ligand
exercises the Stock Purchase Option, subject to Section 5.6 hereof, the Stock
Purchase Option Exercise Price shall be paid in cash, in shares of Ligand Common
Stock, in shares of Allergan Common Stock, or in any combination of cash, shares
of Ligand Common Stock and shares of Allergan Common Stock at the sole
discretion of Ligand; provided, however, that the number of shares of Allergan
Common Stock to be used to pay all or any portion of the Stock Purchase Option
Exercise Price shall not exceed the greater of (a) the number of shares of
Allergan Common Stock then owned by the Corporation and which were received from
Allergan in payment of all or a portion of the 1057 Purchase Option Exercise
Price (as defined in the 1057 Purchase Option Agreement) and (b) the number of
shares of Allergan Common Stock received by the Corporation in connection with
the exercise by Allergan of the Asset Purchase Option as defined in the Asset
Purchase Option Agreement dated on or about June 3, 1995 among the Corporation,
Allergan and Ligand (the "Asset Purchase Option Agreement").
(ii) Payment by Allergan. If Allergan exercises the Stock Purchase
Option, subject to Section 5.6 hereof, the Stock Purchase Option Exercise Price
shall be paid in cash, in shares of Allergan Common Stock, in shares of Ligand
Common Stock, or in any combination of cash, shares of Allergan Common Stock and
shares of Ligand Common Stock, at the sole discretion of Allergan; provided,
however, that the number of shares of Ligand Common Stock to be used to pay all
or any portion of the Stock Purchase Option Exercise Price shall not exceed the
number of shares of Ligand Common Stock then owned by the Corporation and which
were received from Ligand in payment of all or a portion of the 1057 Purchase
Option Exercise Price.
(iii) Valuation of Ligand Common Stock and Allergan Common Stock. The
number of shares of Ligand Common Stock, if any, and the number of shares of
Allergan Common Stock, if any, to be delivered in payment of all or a portion of
the Stock Purchase Option Exercise Price shall be determined by dividing the
portion of the Stock Purchase Option Exercise Price to be paid in shares of
Ligand Common Stock or shares of Allergan Common Stock, as the case may be, by
the average of the closing prices of such stock on the principal national
securities exchange on which such stock is then traded or, if not traded on any
national securities exchange, the average of the closing prices of such stock on
the Nasdaq National Market or, if quoted in the Nasdaq over-the-counter system
and not listed on a national securities exchange or the Nasdaq National Market,
the average of the mean of the closing bid and asked prices quoted on the Nasdaq
over-the-counter system, in each case for the 20 trading days immediately
preceding the day prior to the Stock Purchase Closing Date (as defined in
Section 5.4(d) hereof). If Ligand Common Stock and/or Allergan Common Stock is
not listed on a national securities exchange or the Nasdaq National Market, or
quoted in the Nasdaq over-the-counter system, the number of shares of Ligand
Common Stock or shares of Allergan Common Stock, as the case may be, to be
delivered in payment of all or a portion of the Stock Purchase Option Exercise
Price shall be such number of shares of Ligand Common Stock or shares of
Allergan Common Stock, as the case may be, as represents the fair market value
equivalent of such portion of the Stock Purchase Option Exercise Price, as
determined in good faith by the Board of Directors of the party (Ligand or
Allergan) exercising the Stock Purchase Option (such party being hereinafter
referred to as the "Purchaser").
SECTION 5.4. MANNER OF EXERCISE. (a) Exercise by Ligand or Allergan.
Ligand, and only Ligand, shall exercise the Stock Purchase Option by delivery of
a Stock Purchase Exercise Notice (as defined in clause (c) of this Section 5.4)
to the Corporation and any other holder of shares of Special Common Stock on or
before 20 days prior to the Stock Purchase Expiration Date (the "Ligand
Expiration Date") and, if such notice is not given by Ligand on or before the
Ligand Expiration Date, thereafter Allergan, and only Allergan, shall exercise
the Stock Purchase Option by delivery of a Stock Purchase Exercise Notice to the
Corporation and any other holder of shares of Special Common Stock after the
Ligand Expiration Date and on or before the Stock Purchase Option Expiration
Date. In addition, a copy of any Stock Purchase Exercise Notice sent pursuant to
this Section 5.4
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shall also be sent via first class mail no later than the same date on which the
Stock Purchase Option Notice is delivered to the Corporation to each holder of
record of Callable Common Stock. If the Ligand Expiration Date is not a Business
Day, then the Ligand Expiration Date shall be on the next succeeding Business
Day. Notwithstanding the foregoing, if the Stock Purchase Option is terminated
with respect to Ligand pursuant to Section 5.10(b) hereof, Allergan shall give
the Stock Purchase Exercise Notice pursuant to this Section 5.4 at any time on
or prior to the Stock Purchase Option Expiration Date.
(b) Record Date. "Record Date" shall mean the record date fixed by the
Stock Purchase Exercise Notice which shall be a date no earlier than 10 days
after, and no later than 20 days after, the date of such notice.
(c) Stock Purchase Exercise Notice. The "Stock Purchase Exercise
Notice" shall be a written notice signed by the President of Ligand or Allergan,
as the case may be, given in accordance with the provisions of this Article V
and stating that such party intends to exercise the Stock Purchase Option and
setting forth: (i) the Stock Purchase Option Exercise Price as determined in
accordance with Section 5.2 hereof; (ii) the portion, if any, of the Stock
Purchase Option Exercise Price to be paid in cash, (iii) the portion, if any, of
the Stock Purchase Option Exercise Price to be paid in shares of Ligand Common
Stock; (iv) the portion if any, of the Stock Purchase Option Exercise Price to
be paid in shares of Allergan Common Stock; (v) the Record Date; (vi) the Stock
Purchase Closing Date (as defined in clause (d) of this Section 5.4); and (vii)
the place at which holders of shares of Callable Common Stock may obtain payment
of the Stock Purchase Option Exercise Price for their shares of Callable Common
Stock and any instructions for obtaining such payment; provided, however, that
at any time prior to the Stock Purchase Closing Date, Ligand or Allergan, as the
case may be, may determine to make payment of a greater amount of the Stock
Purchase Option Exercise Price in cash than was set forth in the Stock Purchase
Exercise Notice. The Stock Purchase Option is irrevocable upon delivery of the
Stock Purchase Exercise Notice.
(d) Stock Purchase Closing Date. The "Stock Purchase Closing Date"
shall be a date, not less than 20 days nor more than 40 days, after the date of
the Stock Purchase Exercise Notice on which all of the issued and outstanding
shares of Callable Common Stock will be purchased; provided, however, that the
Stock Purchase Closing Date will be such later date as provided by (i) the last
sentence of Section 5.6 hereof in the event that the conditions described
therein are satisfied, or (ii) Section 5.12 hereof in the event that the
conditions described therein are satisfied.
SECTION 5.5. CLOSING. On or before the Stock Purchase Closing Date, the
Purchaser shall deposit the full amount of the Stock Purchase Option Exercise
Price for all of the issued and outstanding shares of Callable Common Stock with
a bank, transfer agent or similar entity (the "Payment Agent") designated by the
Purchaser to pay, on the Purchaser's behalf, the Stock Purchase Option Exercise
Price. Cash, if any, and shares of Ligand Common Stock, if any, and shares of
Allergan Common Stock, if any, deposited with the Payment Agent shall be
delivered in trust for the benefit of the holders of record of the Callable
Common Stock on the Record Date. The Purchaser shall provide the Payment Agent
with irrevocable instructions to pay, on or within 5 days after the Stock
Purchase Closing Date, the Stock Purchase Option Exercise Price for the Callable
Common Stock to such record holders upon surrender of their certificates
representing shares of the Callable Common Stock. Payment for shares of Callable
Common Stock shall be mailed to each such record holder at the address set forth
in the Corporation's records or at the address provided by each such holder or,
if no address is set forth in the Corporation's records for any such holder or
provided by such holder, to such holder at the address of the Corporation, but
only upon receipt from such holder of certificates evidencing shares of Callable
Common Stock. Any cash or shares of Ligand Common Stock or shares of Allergan
Common Stock deposited with the Payment Agent pursuant to this Section 5.5
remaining unclaimed for two years following the Stock Purchase Closing Date
shall be returned to the Purchaser at its request. At the Purchaser's request,
the Corporation shall provide, or shall cause its transfer agent to provide, to
the Purchaser or to the Payment Agent, free of charge, a complete list of the
record holders of shares of Callable Common Stock, including the number of
shares of Callable Common Stock held of record and the address of each record
holder.
SECTION 5.6. REGISTRATION OF LIGAND COMMON STOCK AND ALLERGAN COMMON
STOCK. If by the Stock Purchase Closing Date set forth in the Stock Purchase
Exercise Notice: (a) with respect to any shares of Ligand Common Stock to be
delivered as payment of the Stock Purchase Option Exercise Price on such date
(i) a registration statement has not been declared effective under the
Securities Act, or (ii) such shares of Ligand Common Stock to be issued in
connection therewith are not (A) listed on the principal national securities
exchange on which Ligand Common Stock is then listed or (B) if Ligand Common
Stock is not then listed on a national securities exchange, listed on the Nasdaq
National Market if Ligand Common Stock is traded thereon or (C) if Ligand Common
Stock is neither listed as provided in either of (A) or (B) nor qualified for
inclusion on the Nasdaq over-the-counter system, then in either of such cases
the Purchaser shall be obligated to make such payment in cash on the Stock
Purchase Closing Date, or (b) with respect to any shares of Allergan Common
Stock to be delivered as payment of the Stock Purchase Option Exercise Price on
such date (i) a registration statement has not been declared effective under the
Securities
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Act, or (ii) such shares of Allergan Common Stock to be issued in connection
therewith are not (A) listed on the principal national securities exchange on
which Allergan Common Stock is then listed or (B) if Allergan Common Stock is
not then listed on a national securities exchange, listed in the Nasdaq National
Market if Allergan Common Stock is traded thereon or (C) if Allergan Common
Stock is neither traded as provided in either of (A) or (B) nor qualified for
inclusion in the Nasdaq over-the-counter system, then in either of such cases
the Purchaser shall be obligated to make such payment in cash on the Stock
Purchase Closing Date. Notwithstanding any other provision herein to the
contrary, the Purchaser shall not be in breach or violation of this Agreement
for any failure to timely pay any amount due hereunder in shares of Ligand
Common Stock or in shares of Allergan Common Stock (i) if such failure to timely
pay such amount arises from a delay in satisfying any of the provisions of this
Section 5.6, so long as the Purchaser shall continue to diligently seek the
satisfaction thereof, or (ii) if such failure to timely pay such amount arises
from a delay in the closing of the Asset Purchase Option as provided for in
Section 1.7 of the Asset Purchase Agreement; provided, however, that such delay
may not exceed sixty (60) days from the original due date of such payment (such
original due date being not less than 20 days, nor more than 40 days, after the
date of the Stock Purchase Exercise Notice).
SECTION 5.7. TRANSFER OF TITLE. Transfer of title to the Purchaser of
all of the Callable Common Stock shall be deemed to occur automatically on the
Stock Purchase Closing Date subject to the payment to the Payment Agent by the
Purchaser on or before such date of the amount owing to the record holders of
Callable Common Stock as determined in accordance with Section 5.2 hereof, and
thereafter the Corporation shall be entitled to treat the Purchaser as the sole
holder of all Callable Common Stock, notwithstanding the failure of any holder
of shares of Callable Common Stock to tender the certificates representing such
shares to the Payment Agent for payment therefor in accordance with Section 5.5
hereof. The Corporation shall instruct its transfer agent not to accept any
shares of Callable Common Stock for transfer on and after the Stock Purchase
Closing Date, except for the shares of Callable Common Stock transferred by the
Purchaser. The Corporation shall take all actions reasonably requested by the
Purchaser to assist in effectuating the transfer of shares of Callable Common
Stock in accordance with this Article V. After the Stock Purchase Closing Date,
the record holders of the Callable Common Stock as determined in accordance with
Section 5.6 above shall have no rights in connection with such Callable Common
Stock other than the right to receive the Stock Purchase Option Exercise Price.
SECTION 5.8. ASSIGNMENT. (i) Assignment by Record Holder. Upon the
assignment, delegation, transfer or sale by any record holder of Callable Common
Stock (a) the Stock Purchase Option shall automatically be assigned to, assumed
by and binding upon such record holder's assignee, purchaser or transferee and
all subsequent assignees, purchasers and transferees, and (b) such shares of
Callable Common Stock shall automatically be subject to the Stock Purchase
Option and the other terms and conditions of this Article V.
(ii) Assignment by Ligand. Ligand may not assign, delegate, transfer or
sell any or all of its rights or obligations under the Stock Purchase Option and
this Article V, in whole or in part, to any person or entity without the prior
approval of the holders of record of a majority of the shares of Callable Common
Stock and the holders of record of a majority of the shares of Special Common
Stock except that Ligand may, without the prior approval of any record holder of
shares of Callable Common Stock or any record holder of shares of Special Common
Stock, make such assignment, delegation, transfer or sale, by operation of law
or otherwise, to (a) any person or entity in connection with its acquisition of
all or substantially all of the assets of Ligand or any merger, consolidation or
similar transaction with Ligand; or (b) any Affiliate (as defined in paragraph
(v) of this Section 5.8) of Ligand; provided, however, that, with respect to
clause (a) above, Ligand shall not, without such approval, enter into such a
transaction unless such person or entity (i) shall, immediately after such
acquisition, merger, consolidation or similar transaction, be a solvent
corporation or other such entity, (ii) shall have, immediately after such
acquisition, merger, consolidation or similar transaction, a tangible net worth
(determined in accordance with generally accepted accounting principles then in
effect) at least equal to the tangible net worth (as so determined) of Ligand
immediately prior thereto, and (iii) shall have agreed in writing to be bound by
the terms of the Stock Purchase Option and this Article V, except that if such
entity is a corporation created or organized in or under the laws of the United
States, it shall have the right to offer its Common Stock (as defined in
paragraph (iv) of this Section 5.8), subject to such Common Stock complying with
the requirements set forth in Section 5.6 hereof, in substitution for Ligand
Common Stock; provided, however, that in the event of any assignment,
delegation, transfer or sale under clause (a) above, Ligand shall provide
written notice to the record holders of shares of Callable Common Stock, the
record holders of shares of Special Common Stock and the Corporation, and in the
event of any assignment, delegation, transfer or sale under clause (b) above,
Ligand shall provide written notice to the record holders of shares of Special
Common Stock and the Corporation, in each case, of any such assignment,
delegation, transfer or sale not later than thirty days after such assignment,
delegation, transfer or sale setting forth the identity and address of the
assignee and summarizing the terms of the assignment, delegation, transfer or
sale. Subject to the foregoing, the Stock Purchase Option and this Article V
shall be binding upon the successors and assigns of Ligand.
7
(iii) Assignment by Allergan. Allergan may not assign, delegate,
transfer or sell any or all of its rights or obligations under the Stock
Purchase Option and this Article V, in whole or in part, to any person or entity
without the prior approval of the holders of record of a majority of the shares
of Callable Common Stock and the holders of record of a majority of the shares
of Special Common Stock, except that Allergan may, without the prior approval of
any record holder of shares of Callable Common Stock or any record holder of
shares of Special Common Stock, make such assignment, delegation, transfer or
sale, by operation of law or otherwise, to (a) any person or entity in
connection with its acquisition of all or substantially all of the assets of
Allergan or any merger, consolidation or similar transaction with Allergan; or
(b) any Affiliate (as defined in paragraph (v) of this Section 5.8) of Allergan;
provided, however, that, with respect to clause (a) above, Allergan shall not,
without such approval, enter into such a transaction unless such person or
entity (i) shall, immediately after such acquisition, merger, consolidation or
similar transaction, be a solvent corporation or other such entity, (ii) shall
have, immediately after such acquisition, merger, consolidation or similar
transaction, a tangible net worth (determined in accordance with generally
accepted accounting principles then in effect) at least equal to the tangible
net worth (as so determined) of Allergan immediately prior thereto, and (iii)
shall have agreed in writing to be bound by the terms of the Stock Purchase
Option and this Article V, except that if such entity is a corporation created
or organized in or under the laws of the United States, it shall have the right
to offer its Common Stock (as defined in paragraph (iv) of this Section 5.8),
subject to such Common Stock complying with the requirements set forth in
Section 5.6 hereof, in substitution for Allergan Common Stock; provided,
however, that in the event of any assignment, delegation, transfer or sale under
clause (a) above, Allergan shall provide written notice to the record holders of
shares of Callable Common Stock, the record holders of shares of Special Common
Stock and the Corporation, and in the event of any assignment, delegation,
transfer or sale under clause (b) above, Allergan shall provide written notice
to the record holders of shares of Special Common Stock and the Corporation, in
each case, of any such assignment, delegation, transfer or sale not later than
thirty days after such assignment, delegation, transfer or sale setting forth
the identity and address of the assignee and summarizing the terms of the
assignment, delegation, transfer or sale. Subject to the foregoing, the Stock
Purchase Option and this Article V shall be binding upon the successors and
assigns of Allergan.
(iv) Common Stock. "Common Stock" shall mean, with respect to any
corporation (the "Acquiror"), common stock having the right under ordinary
circumstances to elect a majority of directors of the Acquiror, and that is
registered under the Securities Act and (a) listed on the principal national
securities exchange on which such common stock of the Acquiror is then listed or
(b) if not listed on a national securities exchange, listed on the Nasdaq
National Market if such stock is traded thereon or, if such stock is neither
listed as provided in either (a) or (b), then qualified for inclusion on the
Nasdaq over-the-counter system.
(v) Affiliates. "Affiliates" shall mean any entity that directly or
indirectly Owns, is Owned by, or is under common Ownership with, a Party, where
"Owns" or "Ownership" means direct or indirect possession and/or control of at
least 50% of the outstanding voting securities of a corporation or a comparable
equity interest in any other type of entity.
SECTION 5.9. LEGEND. Any certificates evidencing shares of Callable
Common Stock issued by or on behalf of the Corporation shall bear a legend in
substantially the following form:
"The securities of Allergan Ligand Retinoid Therapeutics, Inc., a
Delaware corporation ("ALRT"), evidenced hereby are subject to an option of the
holders of the Special Common Stock of ALRT, as described in the Amended and
Restated Certificate of Incorporation of ALRT, to purchase such securities at a
purchase price determined in accordance with Article V thereof, exercisable by
written notice at any time during the period set forth therein. Copies of the
Certificate of Incorporation are available at the principal place of business of
ALRT at 9393 Towne Centre Drive, Suite 100, San Diego, California 92121 and will
be furnished to any stockholder on request and without cost."
SECTION 5.10. TERMINATION. (a) The Stock Purchase Option shall
terminate on the earliest of (i) the Stock Purchase Closing Date, (ii) if the
Stock Purchase Option is not exercised, the Stock Purchase Option Expiration
Date, (iii) subject to the provisions of Section 5.12 hereof, the occurrence of
a Ligand Type II Event of Default (as defined in Section 5.11 hereof), and (iv)
the occurrence of an Allergan Type II Event of Default (as defined in Section
5.11 hereof).
(b) The Stock Purchase Option shall terminate as to Ligand upon (i) the
occurrence of a Ligand Type I Event of Default (as defined in Section 5.11
hereof) and (ii) the Ligand Expiration Date, if Ligand has not given the Stock
Purchase Exercise Notice on or before such date, and (iii) the occurrence of a
Ligand Type II Event of Default.
(c) The Stock Purchase Option shall terminate as to Allergan upon the
occurrence of an Allergan Type I Event of Default (as defined in Section 5.11
hereof).
8
SECTION 5.11. EVENTS OF DEFAULT. (a) Ligand Type I Events of Default.
The events set forth below shall constitute "Ligand Type I Events of Default":
(i) the termination by the Corporation, with respect to Ligand, of the
Technology License Agreement pursuant to Section 9.5 thereof, the Research and
Development Agreement pursuant to Section 11.5 thereof or the Commercialization
Agreement pursuant to Section 12.5 thereof; (ii) Ligand shall (A) seek the
liquidation, reorganization (other than a reorganization which is effected
primarily for tax purposes or to change domicile to any state in the United
States), dissolution or winding-up of itself or the composition or readjustment
of its debts, (B) apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself or of all
or a substantial part of its assets, (C) make a general assignment for the
benefit of its creditors, (D) commence a voluntary case under the Bankruptcy
Code, (E) file a petition in court seeking to take advantage of any other law
relating to bankruptcy, insolvency, reorganization (other than a reorganization
which is effected primarily for tax purposes), winding up or composition or
readjustment of debts, (F) adopt any resolution of its board of directors or
stockholders for the purpose of effecting any of the foregoing, or (G) make an
assignment, delegation, transfer or sale of any or all of its rights or
obligations under the Stock Purchase Option and this Article V otherwise than in
accordance with the requirements of Section 5.8 hereof; or (iii) a proceeding or
case shall be commenced without the application or consent of Ligand and such
proceeding or case shall continue undismissed, or an order, judgment or decree
approving or ordering any of the following shall be entered and continue
unstayed and in effect, for a period of 45 days from and after the date service
of process is effected upon Ligand, seeking (A) Ligand's liquidation,
reorganization, dissolution or winding up, or the composition or readjustment of
its debts, (B) the appointment of a trustee, receiver, custodian, liquidator or
the like of Ligand or of all or any substantial part of its assets, or (C)
similar relief in respect of Ligand under any law relating to bankruptcy,
insolvency, reorganization, winding up or the composition or readjustment of
debt. Ligand shall promptly notify each holder of record of shares of Callable
Common Stock, each holder of record of shares of Special Common Stock and the
Corporation in writing upon the occurrence of any Ligand Type I Event of
Default.
(b) Ligand Type II Events of Default. The failure of Ligand, if the
Stock Purchase Exercise Notice has been given by Ligand, to make the payment
described in Section 5.2 hereof on the Stock Purchase Closing Date shall
constitute a "Ligand Type II Event of Default." Ligand shall promptly notify
each holder of record of shares of Callable Common Stock, each holder of record
of shares of Special Common Stock and the Corporation in writing upon the
occurrence of any Ligand Type II Event of Default.
(c) Allergan Type I Events of Default. The events set forth below shall
constitute "Allergan Type I Events of Default": (i) the termination by the
Corporation, with respect to Allergan, of the Technology License Agreement
pursuant to Section 9.5 thereof, the Research and Development Agreement pursuant
to Section 11.5 thereof or the Commercialization Agreement pursuant to Section
12.5 thereof; (ii) Allergan shall (A) seek the liquidation, reorganization
(other than a reorganization which is effected primarily for tax purposes or to
change domicile to any state in the United States), dissolution or winding up of
itself or the composition or readjustment of its debts, (B) apply for or consent
to the appointment of, or the taking of possession by, a receiver, custodian,
trustee or liquidator of itself or of all or a substantial part of its assets,
(C) make a general assignment for the benefit of its creditors, (D) commence a
voluntary case under the Bankruptcy Code, (E) file a petition in court seeking
to take advantage of any other law relating to bankruptcy, insolvency,
reorganization (other than a reorganization which is effected primarily for tax
purposes), winding-up or composition or readjustment of debts, (F) adopt any
resolution of its board of directors or stockholders for the purpose of
effecting any of the foregoing, or (G) make an assignment, delegation, transfer
or sale of any or all of its rights or obligations under the Stock Purchase
Option and this Article V otherwise than in accordance with the requirements of
Section 5.8 hereof; or (iii) a proceeding or case shall be commenced without the
application or consent of Allergan and such proceeding or case shall continue
undismissed, or an order, judgment or decree approving or ordering any of the
following shall be entered and continue unstayed and in effect, for a period of
45 days from and after the date service of process is effected upon Allergan,
seeking (A) Allergan's liquidation, reorganization, dissolution or winding-up,
or the composition or readjustment of its debts, (B) the appointment of a
trustee, receiver, custodian, liquidator or the like of Allergan or of all or
any substantial part of its assets, or (C) similar relief in respect of Allergan
under any law relating to bankruptcy, insolvency, reorganization, winding up or
the composition or readjustment of debt. Allergan shall promptly notify each
holder of record of shares of Callable Common Stock, each holder of record of
shares of Special Common Stock and the Corporation in writing upon the
occurrence of any Allergan Type I Event of Default.
(d) Allergan Type II Events of Default. The failure of Allergan, if the
Stock Purchase Exercise Notice has been given by Allergan, to make the payment
described in Section 5.2 hereof on the Stock Purchase Closing Date shall
constitute an "Allergan Type II Event of Default." Allergan shall promptly
notify each holder of record of shares of Callable Common Stock, each holder of
record of shares of Special Common Stock and the Corporation in writing upon the
occurrence of any Allergan Type II Event of Default.
9
SECTION 5.12. RIGHTS OF ALLERGAN AFTER A LIGAND TYPE II EVENT OF
DEFAULT. Allergan shall have 10 days after the receipt of the notice of a Ligand
Type II Event of Default, delivered pursuant to Section 5.11 hereof or by the
Corporation in the event such notice is not delivered by Ligand, to exercise the
Stock Purchase Option by delivery to the Corporation of a Stock Purchase
Exercise Notice; provided, that the Record Date and the Stock Purchase Option
Exercise Price in such Stock Purchase Exercise Notice shall be as set forth in
the Stock Purchase Exercise Notice previously delivered to the Corporation by
Ligand; provided, further, that, subject to Section 5.6 hereof, the Stock
Purchase Option Closing Date shall be a date not more than 40 days after the
date of the Stock Purchase Exercise Notice delivered pursuant to this Section
5.12.
SECTION 5.13. ACCELERATION OF THE STOCK PURCHASE OPTION. In the event
the Corporation delivers the Retinoid Program Infeasibility Notice (as defined
in Section 9.6.4 of the Technology License Agreement, Section 11.6.4 of the
Research and Development Agreement or Section 12.6.4 of the Commercialization
Agreement), the Stock Purchase Option shall become immediately exercisable by
the Non-Breaching Party (as defined in Section 9.6 of the Technology License
Agreement, Section 11.6 of the Research and Development Agreement or Section
12.6 of the Commercialization Agreement), on the terms provided herein by
delivery of a Stock Purchase Option Exercise Notice, for a period of 30 days
following its receipt of the Retinoid Program Infeasibility Notice.
SECTION 5.14. AMENDMENT. This Article may not be released, discharged,
amended or modified in any manner except by an instrument approved by the
holders of record of two-thirds (2/3) of the outstanding shares of Special
Common Stock and the holders of record of two-thirds (2/3) of the outstanding
shares of Callable Common Stock of the Corporation; provided, however, that
except as expressly provided herein, without the approval of Ligand and Allergan
and the consent of the holders of record of eighty-five percent of the Callable
Common Stock, this Article V may not be amended to change (a) the amounts of the
Stock Purchase Option Exercise Price, (b) the relevant periods during which and
the conditions under which the Stock Purchase Option may be exercised and the
Stock Purchase Option Exercise Price may be paid, (c) the type of securities or
method of calculating the number of securities to be issued upon the payment of
the Stock Purchase Option Exercise Price, or (d) the provisions of this Section
5.14.
SECTION 5.15. NO CONFLICTING ACTION. The Corporation shall not take, or
permit any other person or entity within its control to take, any action
inconsistent with Ligand's rights and Allergan's rights under this Article V.
The Corporation shall not enter into any arrangement, agreement or
understanding, either oral or in writing, that is inconsistent with the rights
of Ligand and the rights of Allergan and the obligations of the Corporation
hereunder.
ARTICLE VI
DIRECTORS
SECTION 6.1. SIZE AND VACANCIES. (a) The number of directors shall be
as specified in the Bylaws of the Corporation, except that until the earliest of
(i) the exercise of the Stock Purchase Option, (ii) the Stock Purchase Option
Expiration Date and (iii) the date of termination of the Stock Purchase Option
with respect to both Ligand and Allergan pursuant to Section 5.10(a) hereof,
there shall be five directors. In no event will the number of directors be less
than five. Directors need not be stockholders.
(b) Upon any termination of the right of the holders of Special Common
Stock as a class to vote for directors pursuant to Article IV, the term of
office of all Special Common Stock Directors then in office shall terminate
immediately.
(c) Elections of directors of the Corporation need not be by written
ballot, except and to the extent provided in the Bylaws of the Corporation.
10
ARTICLE VII
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 7.1. NO PERSONAL LIABILITY. To the fullest extent permitted by
the General Corporation Law as it now exists and as it may hereafter be amended,
no director of the Corporation shall be personally liable to the Corporation or
its stockholders for monetary damages for breach of fiduciary duty as a
director.
SECTION 7.2. INDEMNIFICATION. The Corporation shall provide
indemnification to its directors, officers, employees or agents to the extent
provided in the Bylaws of the Corporation.
ARTICLE VIII
AMENDMENT
Except as set forth in Sections 4.4 and 5.14, the Corporation reserves
the right to amend, alter, change or repeal any provision of this Certificate of
Incorporation, in the manner now or hereafter prescribed by law, and all rights
conferred on stockholders in this Certificate of Incorporation are subject to
this reservation.
IN WITNESS WHEREOF, the Corporation has caused this certificate to be
executed by its President and Treasurer this 2nd day of June, 1995.
By: /s/ MARVIN E. ROSENTHALE
--------------------------------------
Marvin E. Rosenthale
President
ATTEST:
By: /s/ PAUL V. MAIER
-----------------------------------------
Paul V. Maier
Chief Financial Officer and Treasurer