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Exhibit 10.27
DEBENTURE
NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON CONVERSION
HEREOF HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE OR UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THE SECURITIES ARE RESTRICTED AND MAY NOT BE OFFERED,
RESOLD, PLEDGED OR TRANSFERRED EXCEPT IN ACCORDANCE WITH REGULATION S UNDER THE
ACT, OR AS PERMITTED UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM AS EVIDENCED BY AN OPINION (WHICH SHALL BE IN FORM AND SUBSTANCE
SATISFACTORY TO THE COMPANY) OF COUNSEL SATISFACTORY TO THE COMPANY, THAT SUCH
REGISTRATION IS NOT REQUIRED.
No. 5AUS $350,000
IMMUNOGEN, INC.
7% SUBORDINATED CONVERTIBLE DEBENTURE DUE July 31, 1996
THIS DEBENTURE is one of a duly authorized issue of Debentures of
IMMUNOGEN, INC., a corporation duly organized and existing under the laws of
the Commonwealth of Massachusetts (the "Company"), designated as its 7%
Convertible Debenture Due July 31, 1996.
FOR VALUE RECEIVED, the Company promises to pay to BARRAS INVESTMENTS
INC., the registered holder hereof (the "Holder"), the principal sum of THREE
HUNDRED FIFTY THOUSAND DOLLARS (US $350,000) on July 31, 1996 (the "Maturity
Date") and to pay interest on the principal sum outstanding from time to time
in arrears on July 31, 1996, at the rate of 7% per annum accruing from the date
of initial issuance. Accrual of interest shall commence on the first such
business day to occur after the date hereof until payment in full of the
principal sum has been made or duly provided for. All interest so payable will
be paid to the person in whose name this Debenture (or one or more predecessor
Debentures) is registered on the records of the Company regarding registration
and transfers of the Debentures (the "Debenture Register") on the tenth day
prior to the Maturity Date; provided, however, that the Company's obligation to
a transferee of this Debenture arises only if such transfer, sale or other
disposition is made in accordance with the terms and conditions of the
Regulation S Subscription Agreement executed by the original Holder. The
principal of, and interest on, this Debenture are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts, at the address last appearing
on the Debenture Register of the Company as designated in writing by the Holder
from time to time. The Company will pay the principal of and interest upon
this Debenture on the Maturity Date, less any amounts required by law to be
deducted, to the registered holder of this Debenture as of the tenth day prior
to the Maturity Date and addressed to such holder as the last address appearing
on the Debenture Register. The forwarding of such check shall constitute a
payment of interest hereunder and shall satisfy and discharge the liability for
principal and interest on this Debenture to the extent of the sum represented
by such check plus any amounts so deducted.
This Debenture is subject to the following additional provisions:
1. The Debentures are issuable in denominations of Fifty Thousand
Dollars (US $50,000) and integral multiples thereof. The Debentures are
exchangeable for an equal aggregate principal amount of Debentures of different
authorized denominations, as requested by the Holders surrendering the same.
No service charge will be made for such registration or transfer or exchange.
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2. The Company shall be entitled to withhold from all payments of
principal of, and interest on, this Debenture any amounts required to be
withheld under the applicable provisions of the United States income tax laws
or other applicable laws at the time of such payments, and Holder shall execute
and deliver all required documentation in connection therewith.
3. This Debenture has been issued subject to investment representations
of the original purchaser hereof and may be transferred or exchanged only in
compliance with the Securities Act of 1933, as amended (the "Act"), and other
applicable state and foreign securities laws. In the event of any proposed
transfer of this Debenture, the Company may require, prior to issuance of a new
Debenture in the name of such other person, that it receive reasonable transfer
documentation including opinions that the issuance of the Debenture in such
other name does not and will not cause a violation of the Act or any applicable
state or foreign securities laws. Prior to due presentment for transfer of
this Debenture, the Company and any agent of the Company may treat the person
in whose name this Debenture is duly registered on the Company's Debenture
Register as the owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Debenture be overdue,
and neither the Company nor any such agent shall be affected by notice to the
contrary.
4. The Holder of this Debenture is entitled, at its option, to convert at
any time commencing on forty-five (45) days after the closing of the sale of
the entire series of Debentures of which this Debenture is a part until
maturity hereof, all or a portion of the principal amount of this Debenture,
provided the principal amount converted is at least US $50,000 (unless if at
the time of such election to convert the aggregate principal amount of all
Debentures registered to the Holder is less than Fifty Thousand Dollars (US
$50,000), then the whole amount thereof), into shares of Common Stock of the
Company at a conversion price for each share of Common Stock equal to
Seventy-Five Percent (75%) of the Market Price of the Company's Common Stock
per share. For purposes of this Section 4, the Market Price shall be the
closing price of the Common Stock on the trading day immediately preceding the
conversion date as reported by the National Association of Securities Dealers
Automated Quotation System ("NASDAQ"), or the closing bid price on the
over-the-counter market on such date or, in the event the Common Stock is
listed on a stock exchange, the Market Price shall be the closing price on the
exchange on such date, as reported in the Wall Street Journal. Such conversion
shall be effectuated by surrendering the Debentures to be converted to the
Company with the form of conversion notice attached hereto as Exhibit A,
executed by the Holder of the Debenture evidencing such Holder's intention to
convert this Debenture or a specified portion (as above provided) hereof, and
accompanied, if required by the Company, by proper assignment hereof in blank.
Interest accrued or accruing from the date of issuance to the date of
conversion shall be paid upon conversion by issuance of shares of Common Stock
of the Company, at the Market Price. No fraction of Shares or scrip
representing fractions of shares will be issued on conversion, but the number
of shares issuable shall be rounded to the nearest whole share. The date on
which notice of conversion is given shall be deemed to be the date on which the
Holder has delivered this Debenture, with the conversion notice duly executed,
to the Company or, if earlier, the date of receipt of such notice of conversion
if the Debenture is received by the Company within three (3) business days
therefrom. Facsimile delivery of the conversion notice shall be accepted by
the Company. Certificates representing Common Stock upon conversion will be
delivered within five (5) business days from the date the notice of conversion
is delivered to the Company.
5. Notwithstanding the foregoing, the Company shall not be required to
convert the Debentures, or any portion thereof, to the extent that as a
consequence of such conversion, together with all prior conversions of
Debentures issued simultaneously herewith, the Company would be required to
issue more than 19.99% of the outstanding shares of Common Stock on the date of
issuance of the issued Debentures issued simultaneously herewith (as reported
in the Company's most recent SEC report) upon
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such conversion, without the approval of the holders of the Common Stock. The
Company shall promptly notify all holders of Debentures in writing in the event
that the Company can no longer convert any such Debentures, and in such event
the Company shall, at the request of a majority of holders, either call a
shareholders meeting to seek the approval required and shall use its reasonable
best efforts to obtain such shareholder approval, or redeem the Debentures that
it cannot convert in accordance with and upon the terms hereof, within ten (10)
days after delivery of a request for redemption.
6. No provision of this Debenture shall alter or impair the obligation of
the Company, which is absolute and unconditional, to pay the principal of, and
interest on, this Debenture at the time, place, and rate, and in the coin or
currency, herein proscribed. This Debenture and all other Debentures now or
hereafter issued of similar terms are direct obligations of the Company. This
Debenture ranks equally with all other Debentures now or hereafter issued under
the terms set forth herein.
7. No recourse shall be had for the payment of the principal of, or the
interest on, this Debenture, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director, as
such, past, present or future, of the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
8. If the Company merges or consolidates with another corporation or
sells or transfers all or substantially all of its assets to another person and
the holders of the Common Stock are entitled to receive stock, securities or
property in respect of or in exchange for Common Stock, then as a condition of
such merger, consolidation, sale or transfer, the Company and any such
successor, purchaser or transferee shall amend this Debenture to provide that
it may thereafter be converted on the terms and subject to the conditions set
forth above into the kind and amount of stock, securities or property
receivable upon such merger, consolidation, sale or transfer by a holder of the
number of shares of Common Stock into which this Debenture might have been
converted immediately before such merger, consolidation, sale or transfer,
subject to adjustments which shall be as nearly equivalent as may be
practicable. In the event of any proposed merger, consolidation or sale or
transfer of all or substantially all of the assets of the Company (a "Sale"),
the Holder hereof shall have the right to convert by delivering a Notice of
Conversion to the Company within fifteen (15) days of receipt of notice of such
Sale from the Company. In the event the Holder hereof shall elect not to
convert, the Company may prepay all outstanding principal and accrued interest
on this Debenture, less all amounts required by law to be deducted, upon which
tender of payment following such notice, the right of conversion shall
terminate.
9. The Holder of the Debenture, by acceptance hereof, agrees that this
Debenture is being acquired for investment and that such Holder will not offer,
sell or otherwise dispose of this Debenture or the Shares of Common Stock
issuable upon conversion thereof except under circumstances which will not
result in a violation of the Act or any applicable state Blue Sky or foreign
laws or similar laws relating to the sale of securities.
10. This Debenture shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
11. The following shall constitute an "Event of Default":
a. The Company shall default in the payment of principal or interest
on this Debenture; or
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b. Any of the representations or warranties made by the Company
herein, in the Subscription Agreement, or in any certificate or financial or
other written statements heretofore or hereafter furnished by or on behalf of
the Company in connection with the execution and delivery of this Debenture or
the Subscription Agreement shall be false or misleading in any material respect
at the time made; or
c. The Company shall fail to perform or observe, in any material
respect, any other covenant, term, provision, condition, agreement or
obligation of the Company under this Debenture and such failure shall continue
uncured for a period of thirty (30) days after notice from the Holder of such
failure; or
d. The Company shall (1) admit in writing its inability to pay its
debts generally as they mature; (2) make an assignment for the benefit of
creditors or commence proceedings for its dissolution; or (3) apply for or
consent to the appointment of a trustee, liquidator or receiver for its or for
a substantial part of its property or business; or
e. A trustee, liquidator or receiver shall be appointed for the
Company or for a substantial part of its property or business without its
consent and shall not be discharged within sixty (60) days after such
appointment; or
f. Any governmental agency or any court of competent jurisdiction at
the instance of any governmental agency shall assume custody or control of the
whole or any substantial portion of the properties or assets of the Company and
shall not be dismissed within sixty(60) days thereafter; or
g. Any money judgment, writ or warrant of attachment, or similar
process in excess of Two Hundred Thousand ($200,000) Dollars in the aggregate
shall be entered against the Company or any of its properties or other assets
and shall remain unpaid, unvacated, unbonded or unstayed for a period of sixty
(60) days or in any event later than five (5) days prior to the date of any
proposed sale thereunder; or
h. Bankruptcy, reorganization, insolvency or liquidation
proceedings or other proceedings for relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against the Company and, if
instituted against the Company, shall not be dismissed within sixty (60) days
after such institution or the Company shall by any action or answer approve of,
consent to, or acquiesce in any such proceedings or admit the material
allegations of, or default in answering a petition filed in any such
proceeding; or
i. The Company shall have its Common Stock delisted from an exchange
or over-the-counter market or suspended from trading; provided that a change in
the listing of the Common Stock from NASDAQ/NMS to the NASDAQ SmallCap Market
will not constitute a default hereunder.
Then, or at any time thereafter, and in each and every such case, unless such
Event of Default shall have been waived in writing by the Holder (which waiver
shall not be deemed to be a waiver of any subsequent default) at the option of
the Holder and in the Holder's sole discretion, the Holder may consider this
Debenture immediately due and payable, without presentment, demand, protest or
notice of any kinds, all of which are hereby expressly waived, anything herein
or in any note or other instruments contained to the contrary notwithstanding,
and the Holder may immediately, and without expiration of any period of grace,
enforce any and all of the Holder's rights and remedies provided herein or any
other rights or remedies afforded by law.
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12. Nothing contained in this Debenture shall be construed as conferring
upon the Holder the right to vote or to receive dividends or to consent or
receive notice as a shareholder in respect of any meeting of shareholders or
any rights whatsoever as a shareholder of the Company, unless and to the extent
converted in accordance with the terms hereof.
13. The Company and each Holder of this Debenture covenant and agree that
the payment of the principal of and interest on this Debenture shall be
subordinated in right of payment to the prior payment in full in cash of all of
the Company's indebtedness or obligations of any kind whatsoever outstanding
from time to time that is not expressly designated as subordinated indebtedness
(the "Senior Debt"). In the event of any insolvency, bankruptcy or similar
proceedings relative to the Company or to its property, then:
a. the holders of Senior Debt shall be entitled to receive payment in
full in cash of all amounts due on or in respect of all Senior Debt before the
Holder of this Debenture is entitled to receive any payment or distribution of
any kind or character on account of this Debenture;
b. any payment or distribution by the Company of any kind or
character to which the Holder of this Debenture would be entitled but for the
provisions of this Section shall be paid, ratably, directly to the holders of
Senior Debt or their representative or representatives; and
c. in the event that, notwithstanding the foregoing, the Holder of
this Debenture shall have received any payment or distribution by the
Company of any kind or character, from and after the date of any such event set
forth above before all Senior Debt is paid in full in cash, then and in such
event such payment or distribution shall be paid over or delivered forthwith to
the trustee in bankruptcy or other person or entity making payment or
distribution of assets of the Company for application to the payment of all
Senior Debt remaining unpaid.
In case any payment or distribution shall be paid or delivered to any
Holder of this Debenture in violation or contravention of the terms of this
Section, such payment or distribution shall, upon such Holder's receipt of
notice of such violation or contravention, be held in trust for and paid and
delivered ratably to the holders of Senior Debt (or their duly authorized
representatives), until all Senior Debt shall have been paid in full.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by an officer thereunto duly authorized.
Dated: __________________________ IMMUNOGEN, INC.
By: /S/MITCHEL SAYARE
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Mitchel Sayare
Chief Executive Officer
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EXHIBIT A
NOTICE OF CONVERSION
(To be Executed by the Registered Holder in order to Convert the Debenture)
The undersigned hereby irrevocably elects to convert $ ________________ of
the principal amount of the above Debenture No. ___ into Shares of Common Stock
of IMMUNOGEN, INC. (the "Company") according to the conditions hereof, as of
the date written below.
The undersigned represents that it is not a U.S. Person as defined in
Regulation S promulgated under the Securities Act of 1933, is not converting
the Debenture on behalf of any U.S. Person and is converting the Debenture
outside of the United States and will receive the shares of Common Stock
issuable upon conversion outside of the United States.
Date of Conversion* ___________________________________________________________
Applicable Conversion Price ___________________________________________________
Signature _____________________________________________________________________
[Name]
Address: ______________________________________________________________________
_____________________________________________________________________________
* This original Debenture and Notice of Conversion must be received by the
Company by the fifth business day following the Date of Conversion.
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IMMUNOGEN, INC.
DEBENTURE HOLDER AMOUNT CONVERSION DATE
- ---------------- ------ ---------------
FTS Worldwide Corp. $350,000 10/02/95
Euro Factors International, Inc. 250,000 10/02/95
Siata Holding Corp. 350,000 10/02/95
Nepo Invest Trade 500,000 10/02/95
Barras Investments Inc. 350,000 10/02/95
FTS Worldwide Corp. 350,000 10/18/95
Euro Factors International, Inc. 250,000 10/18/95
Siata Holding Corp. 350,000 10/18/95
Nepo Invest Trade 500,000 10/18/95
Barras Investments Inc. 350,000 10/18/95
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