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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment. No.3)*
NEXELL THERAPEUTICS INC.
(Formerly Known as VIMRx Pharmaceuticals Inc.)
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(Name of Issuer)
COMMON SHARES, $0.001 PAR VALUE PER SHARE
-----------------------------------------
(Title of Class of Securities)
65332H104
(Previous CUSIP Number: 927186106)
----------------------------------
(CUSIP Number)
Jan Stern Reed
BAXTER INTERNATIONAL INC.
One Baxter Parkway
Deerfield, Illinois 60015
847.948.2212
________________________________________________________________________________
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 24, 1999
-----------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
Schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[_].
NOTE: Schedules filed in paper format should include a signed original and
five (5) copies of the schedule, including all exhibits. See Rule
13d-7(b) for other parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class
of securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
(Continued on following page(s))
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SCHEDULE 13D
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CUSIP NO.65332H104 PAGE 2 OF 4 PAGES
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NAME OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BAXTER INTERNATIONAL INC.
I.R.S. Identification Number: 36-0781620
BAXTER HEALTHCARE CORPORATION
I.R.S. Identification Number: 36-2604143
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [_]
(b) [_]
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SEC USE ONLY
3
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SOURCE OF FUNDS*
4
WC
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
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CITIZENSHIP OR PLACE OF ORGANIZATION
6
DELAWARE
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SOLE VOTING POWER
7
NUMBER OF
-0-
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
14,000,000
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING -0-
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
14,000,000
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
44,757,091 (Includes the right to acquire 5,200,000 shares of Common Stock
pursuant to the Warrant (as defined herein) and the right to acquire
25,557,091 shares of Common Stock pursuant to the shares of Series A
Preferred Stock described herein)
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13 34.62% (Assumes the exercise of the Warrant and the conversion of the
shares of Series A Preferred Stock, neither of which have occurred)
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
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This Amendment No. 3 to Schedule 13D (the "Amendment") relates to the holdings
of Baxter Healthcare Corporation, a Delaware corporation ("Purchaser"), of
14,000,000 shares (the "Shares") of common stock, $0.001 par value per share
("Common Stock"), of Nexell Therapeutics Inc. (formerly known as VIMRx
Pharmaceuticals Inc.) (the "Company"); a Warrant to purchase 5,200,000 shares of
Common Stock; and 70,282 shares of Series A Preferred Stock presently
convertible into 25,557,091 shares of Common Stock. The Amendment amends and
supplements the previously filed Schedule 13D, as amended, as described below.
ITEM 1. SECURITY AND ISSUER.
Item 1 is hereby amended and restated as follows:
This statement relates to the Common Stock of the Company. The address of the
principal executive offices of the Company is:
9 Parker
Irvine, CA 92618-1605
Telephone: 949.470.9011
ITEM 6. CONTRACTS OR ARRANGEMENTS WITH RESPECT TO ISSUER SECURITIES.
Item No. 6 is hereby amended by deleting the heading and the paragraph under
"Restructuring Relationship" and by inserting the following paragraph in its
place:
On November 24, 1999, Purchaser and the Company entered into a Put Agreement
whereby Purchaser agreed to issue Put Rights in connection with the private
placement by the Company of $63,000,000 aggregate principal amount of Series B
Preferred Stock, warrants to purchase common stock of Company, and Put Rights.
Each Put Right entitles the holder to cause Purchaser to purchase the shares of
Series B Preferred Stock during a specified time frame at a price equal to the
original purchase price of the Series B Preferred Stock plus a specified rate of
return. The Put Right is exercisable by holders at any time between November 24,
2002 and November 24, 2004, unless earlier terminated as provided in the Put
Certificate. In addition, Purchaser and the Company entered into a Side Letter
whereby the conversion price of the Series B Preferred Stock is to be adjusted
downward per the terms of the Side Letter in the event of a put to Purchaser of
the Series B Preferred Stock by the holders.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
Item No. 7 is hereby amended by inserting the following additional exhibits:
EXHIBIT 7.7 Put Agreement, dated November 24, 1999, by and between Purchaser
and the Company
EXHIBIT 7.8 Form of Put Certificate held by the Investors
EXHIBIT 7.9 Side Letter dated November 24, 1999, by and between the
Purchaser and the Company
Page 3 of 4 Pages
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, each of the
undersigned corporations certifies that the information set forth in this
statement is true, complete and correct.
Dated: November 30, 1999
BAXTER HEALTHCARE CORPORATION
BY: /s/ Jan Stern Reed
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Jan Stern Reed
Secretary
BAXTER INTERNATIONAL INC.
By: /s/ Jan Stern Reed
------------------
Jan Stern Reed
Secretary
Page 4 of 4 Pages
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EXHIBIT 7.7
PUT AGREEMENT
This Put Agreement, dated as of November 24, 1999 (the "Agreement"), is
made between Nexell Therapeutics Inc., a Delaware corporation ("the Company"),
and Baxter International Inc., a Delaware corporation ("Baxter").
Whereas, in connection with that certain Securities Agreement dated of even
date herewith between the Company and the signatories thereto, and in
consideration of the repayment by the Company of those certain convertible
subordinated debentures currently held by Baxter, Baxter desires to grant a Put
Right in connection with the Series B Preferred purchased at the Private
Placement Closing (as described below).
Now, Therefore, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties agree as follows:
Section 1. DEFINITIONS
As used herein, the following terms shall have the following meanings:
"Affiliate" has the meaning set forth in Rule 12b-2 under the Exchange Act;
provided, however, that Baxter shall not be considered an Affiliate of the
Company and the Company shall not be considered an Affiliate of Baxter for
purposes of this Agreement.
"Common Stock" shall mean the Common Stock of the Company, $.001 par value.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
or any similar Federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in effect at the time.
"Liens" shall mean all security interests, mortgages, liens, claims,
pledges, charges, voting agreements or other encumbrances of any nature
whatsoever.
"Material Adverse Effect" shall mean a material adverse effect on the
business, assets, liabilities, results of operations or financial condition of
the Company and its subsidiaries taken as a whole or the ability of the Company
to perform its obligations under this Agreement of the Put Rights or to
consummate the transactions contemplated hereby or thereby.
"Person" shall mean an individual, partnership, corporation, limited
liability company, association, joint venture, trust or unincorporated
organization, government or agency or political subdivision thereof or other
entity.
"Placement Agent" shall mean a registered broker-dealer appointed to effect
the Private Placement.
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"Private Placement" shall have the meaning provided in Section 2 below.
"Private Placement Closing" shall mean the closing of the Private
Placement.
"Private Placement Closing Date" shall mean the date on which the Private
Placement Closing occurs.
"Private Placement Memorandum" shall have the definition ascribed to it in
Paragraph 4 of the Closing Certificate attached as Exhibit D to the Securities
Agreement.
"Put Right" shall mean a right in the form of Exhibit A hereto.
"Preferred Stock" shall mean the Preferred Stock of the Company, $.001 par
value.
"Purchase Price" shall mean the price paid for each share of Series B
Preferred by the purchasers at the Private Placement Closing.
"Put Stock" shall mean the capital stock of the Company that Baxter is
required to purchase upon exercise of the Put Right. Initially, the Put Stock
shall be the share of Series B Preferred Stock issued in connection with the Put
Right. The Put Stock may be adjusted from time to time, as required, for any of
the events set forth in Section 10.1 of this Agreement.
"Rules and Regulations" shall mean the rules and regulations promulgated by
the SEC under the Securities Act and the Exchange Act.
"SEC" shall mean the U.S. Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
similar Federal statute, and the rules and regulations of the SEC thereunder,
all as the same shall be in effect at the time.
"Securities Agreement" shall mean the Securities Agreement dated of even
date herewith between the Company and the purchasers named in Schedule 1
thereto.
"Series B Preferred" shall mean the shares of Series B Preferred Stock of
the Company, $.001 par value.
"Side Letter" shall mean the letter agreement between the Company and
Baxter in substantially the form of Exhibit B hereto.
"Subsidiary" has the meaning set forth in Rule 12b-2 under the Exchange
Act.
"Warrants" shall mean the Class A Warrants and Class B Warrants issued by
the Company pursuant to the Securities Agreement.
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SECTION 2. PRIVATE PLACEMENT.
The Company shall use its reasonable best efforts to effect a private
placement with the purchasers named in the Securities Agreement (the "Private
Placement") of $63,000,000 of Series B Preferred, the Put Rights and the
Warrants in a transaction exempt from the registration requirements of the
Securities Act.
SECTION 3. PUT RIGHTS.
At the Private Placement Closing, Baxter agrees to issue one Put Right as a
component of each Series B Preferred purchased at the Private Placement Closing.
In connection with the inclusion of the Put Rights in the Private Placement, the
Company may include in the Private Placement Memorandum such information
relating to Baxter as may be included in publicly available reports which have
been filed by Baxter with the SEC pursuant to the Securities Act or the Exchange
Act.
SECTION 4. PRIVATE PLACEMENT PROCEDURES.
In connection with the Private Placement the Company shall:
4.1 prepare a Private Placement Memorandum, together with such
amendments and supplements thereto as may be necessary to comply in all material
respects with the provisions of the Securities Act, the Exchange Act, the Rules
and Regulations, any state blue sky or securities law or other federal or state
law with respect to the sale or other disposition of the Series B Preferred, Put
Rights and Warrants. Such Private Placement Memorandum shall include only such
references to the Put Rights and to Baxter and its obligations thereunder as
shall be approved by Baxter;
4.2 use its best efforts to perfect exemptions for the Series B
Preferred, Put Rights and Warrants covered by the Private Placement Memorandum
under the Securities Act and all applicable Rules and Regulations and such other
securities or blue sky laws of such jurisdictions as shall be necessary in order
to effect the Private Placement, except that the Company shall not for any such
purpose be required to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified or to file therein any general
consent to service of process;
4.3 deliver to Baxter an opinion of independent counsel to the Company,
which opinion shall be addressed to Baxter or upon which Baxter is entitled to
rely and which shall be in form and substance satisfactory to Baxter in its
reasonable judgment, to the effect that the Private Placement is exempt from the
registration requirements of the Securities Act and all applicable Rules and
Regulations and such other securities or blue sky laws of all applicable
jurisdictions;
4.4 enter into and perform its obligations under an agreement, in usual
and customary form, with the Placement Agent and under the Securities Agreement,
including, without limitation, to deliver to the purchasers in the Securities
Agreement an opinion of counsel to the Company in the usual and customary form
for the Private Placement;
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4.5 notify Baxter, at any time when a Private Placement Memorandum is
required to be delivered under applicable law, of the happening of any event of
which it has knowledge as a result of which the Private Placement Memorandum, as
then in effect, contains an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing,
and to suspend all offers and sales of the Series B Preferred, Put Rights and
Warrants immediately until such misstatement or omission has been corrected; and
4.6 make available to the Placement Agent, and authorize the Placement
Agent on behalf of the Company to make available to each offeree, prior to the
sale of Series B Preferred and Put Rights to such offeree, the opportunity to
ask questions of and receive answers from representatives of the Company, and
the opportunity to obtain additional information, with respect to the Company
and the terms and conditions of the Private Placement in order to permit such
offeree to verify the accuracy of the information contained in the Private
Placement Memorandum and of any other information referred to herein.
SECTION 5. INDEMNIFICATION.
5.1 Indemnity by Company. To the extent permitted by law, the Company
will indemnify and hold harmless Baxter, the officers and directors of Baxter,
each underwriter (as defined in the Securities Act) or placement agent, and each
Person, if any, who controls (within the meaning of the Securities Act or
Exchange Act) Baxter or any such underwriter or placement agent, against any
breaches by the Company of its representations and warranties and against any
losses, claims, damages, liabilities or expenses (joint or several) to which
they may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages, liabilities and
expenses (or actions in respect thereof) arise out of or are based upon any of
the following statements, omissions or violations (collectively a "Violation"):
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Private Placement Memorandum, (ii) the omission or alleged
omission to state in the Private Placement Memorandum a material fact required
to be stated therein, or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, or (iii) any
violation or alleged violation of the Securities Act, the Exchange Act, any
state blue sky or securities law or any rule or regulation promulgated under the
Securities Act, the Exchange Act or any state blue sky or securities law in
connection with the Private Placement. The Company will reimburse Baxter, each
officer or director of Baxter, each such underwriter or placement agent, and
each person, if any, who controls (within the meaning of the Securities Act or
Exchange Act) Baxter or any such underwriter or placement agent for any
reasonable or other expenses incurred by them (including reasonable fees and
disbursements of counsel) in connection with investigating or defending any such
loss, claim, damage, liability, expense or action; provided, however, that the
Company shall not be liable to Baxter, the officers or directors of Baxter, each
such underwriter or placement agent, or any Person who controls (within the
meaning of the Securities Act or Exchange Act) Baxter or any such underwriter or
placement agent in any such case for any such loss, claim, damage, liability,
expense or action to the extent that it arises out of or is based upon a
Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with the Private Placement
Memorandum by Baxter or any Affiliate, officer, director or controlling Person
of Baxter.
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5.2 Indemnity by Baxter. To the extent permitted by law, Baxter will
indemnify the Company, its directors and officers and each Person who controls
the Company (within the meaning of the Securities Act or Exchange Act) against
any losses, claims, damages, liabilities and expenses resulting from any
breaches by Baxter of its representations and warranties hereunder or Violation,
but only to the extent that such Violation is contained in or results from any
information so furnished in writing by Baxter specifically for use in the
Private Placement Memorandum. Notwithstanding anything to the contrary contained
herein, Baxter shall have no obligation to indemnify under this Section 5.2 to
the extent that it has corrected information and provided that corrected
information to the Company and the Placement Agent for use in a revised Private
Placement Memorandum and a Violation based upon the earlier incorrect
information occurs following such time.
5.3 Notice; Right to Defend. Promptly after receipt by an indemnified
party under this Section 5 of notice of the commencement of any action
(including any governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this Section
5, deliver to the indemnifying party a written notice of the commencement
thereof and the indemnifying party shall have the right to participate in, and,
if the indemnifying party agrees in writing that it will be responsible for any
costs, expenses, judgments, damages and losses incurred by the indemnified party
with respect to such claim, jointly with any other indemnifying party similarly
noticed, to assume the defense thereof with counsel mutually satisfactory to the
parties; provided, however, that an indemnified party shall have the right to
retain its own counsel, with the fees and expenses to be paid by the
indemnifying party, if representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action shall relieve such indemnifying party of any liability to the
indemnified party under this Section 5 only if and to the extent that such
failure is prejudicial to its ability to defend such action, and the omission so
to deliver written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party other than under this
Section 5.
5.4 Contribution. If the indemnification provided for in this Section 5
is held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, liability, claim, damage or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party thereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage or expense
in such proportion as is appropriate to reflect the relative benefits received
by the indemnifying party on the one hand and of the indemnified party on the
other hand in connection with the Private Placement or, if such allocation is
not permitted by applicable law, not only such relative benefits but also the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other hand in connection with the statements or omissions which
resulted in such loss, liability, claim, damage or expense as well as any other
relevant equitable considerations. The relative fault of the indemnifying party
and the indemnified party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the
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indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
5.5 Survival of Indemnity. The indemnification and contribution provided
by this Section 5 shall be a continuing right to indemnification and
contribution and shall survive the Private Placement Closing and the expiration
or termination of this Agreement or of the Put Rights.
SECTION 6. REPRESENTATIONS, WARRANTIES AND COVENANT OF THE COMPANY.
The Company represents and warrants to Baxter that:
6.1 The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and is qualified to do
business in every jurisdiction in which the failure to be so qualified would
have a Material Adverse Effect. The Company has all requisite corporate power
and authority and all material licenses, permits and authorizations necessary to
own and operate its properties, to carry on its businesses as now conducted and
presently proposed to be conducted and to carry out the transactions
contemplated by this Agreement.
6.2 The Private Placement Memorandum (i) does not, at the time delivered
to any offeree or at the time of the Private Placement Closing, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they are made, not misleading and (ii)
complies in all material respects with all applicable provisions of the
Securities Act and the Exchange Act and the Rules and Regulations, and
applicable state blue sky or securities laws. Notwithstanding the foregoing, the
Company makes no representation or warranty with respect to any information
provided in writing by Baxter or the Placement Agent specifically for use in the
Private Placement Memorandum;
6.3 The Placement Agent will be furnished with copies of the Private
Placement Memorandum in the quantities requested;
6.4 No action directed to, or which could reasonably be expected to
result in, preventing or suspending the use of the Private Placement Memorandum
has been taken or is pending or, to the knowledge of the Company, threatened by
the SEC or any state regulatory authority.
6.5 The financial statements of the Company, together with the notes
thereto, included in the Private Placement Memorandum present fairly the
financial position of the Company as of the dates thereof and the results of
operations and changes in financial position of the Company for the periods
covered thereby, and have been prepared in conformity with generally accepted
accounting principles consistently applied, except as otherwise stated therein.
6.6 The Company has an authorized capitalization as set forth in the
Securities Agreement, and, after giving effect to the issuance and sale of the
Series B Preferred, Put Rights
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and Warrants, will have on the Private Placement Closing Date the adjusted
authorized capitalization as set forth in the Securities Agreement. The correct
number of issued and outstanding shares of Common Stock and Preferred Stock of
the Company as of November 24, 1999 is set forth in the Securities Agreement,
and all such shares of Common Stock and Preferred Stock have been duly
authorized and validly issued, are fully paid and nonassessable and were not
issued in violation of or subject to any preemptive rights. As of November 24,
1999, there is no outstanding option, warrant or other right calling for the
issuance of, and no commitment, plan or arrangement to issue, any shares of
capital stock of the Company or any security convertible into or exchangeable
for capital stock of the Company other than as set forth in the Private
Placement Memorandum or the Securities Agreement.
6.7 The Series B Preferred will be, as of the Private Placement Closing
Date, duly and validly authorized, and when issued and delivered to the
purchasers in the Private Placement against payment therefor, will be duly and
validly issued, fully paid and nonassessable. The issuance of the Series B
Preferred is not subject to any preemptive rights. The descriptions of the
Series B Preferred and any other securities of the Company in the Securities
Agreement conform in all material respects to the rights set forth in the
instruments defining the same, and the certificates used to evidence the shares
of Series B Preferred will be in due and proper form. All actions of the Company
in connection with the offer and sale of the outstanding capital stock of the
Company have been, and the offer and sale of the Series B Preferred and Put
Rights will be, effected in compliance in all material respects with applicable
law. Upon payment and delivery in accordance herewith, each of the purchasers in
the Private Placement will receive good, valid and marketable title to its
respective Series B Preferred, free and clear of all Liens.
6.8 The Company has taken all corporate action necessary for it to
execute, deliver and perform this Agreement, and the Company has full corporate
power and authority to enter into this Agreement and perform its obligations
hereunder. This Agreement is the valid and legally binding agreement of the
Company enforceable in accordance with its terms, except as rights to
indemnification may be unenforceable insofar as they relate to violations of
state or federal securities laws and except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws affecting creditors' rights generally or by equitable principles.
6.9 KPMG LLP, whose reports on the audited financial statements of the
Company have been included in the Private Placement Memorandum, are independent
public accountants with respect to the Company, within the meaning of the Rules
and Regulations.
6.10 The Company has not, within six months of the date hereof, directly
or indirectly, sold or offered, or attempted to offer or dispose of, any equity
or debt securities or substantially similar securities of the Company to, or
solicited offers to buy any thereof from, or otherwise approached or negotiated
in respect thereof with, any offeree in such manner as to require the
registration of the Series B Preferred and Put Rights under the Securities Act.
6.11 Based in part on the representations made by the purchasers in the
Securities Agreement, the offer and sale of the Series B Preferred, Put Rights
and Warrants in the Securities
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Agreement are exempt from the registration requirements of the Securities Act
and all applicable Rules and Regulations and such other securities or blue sky
laws of all applicable jurisdictions.
6.12 The sale of the Series B Preferred and Warrants by the Company
hereunder and the performance of the transactions contemplated hereby is not
prohibited by any applicable law, administrative or governmental rule or
regulation or order of a court of competent jurisdiction. No action, suit or
proceeding exists or, to the Company's knowledge, is threatened that would
prevent, restrain or condition in any material respect the issuance of the
Series B Preferred and Put Rights by the Company and Baxter in the Private
Placement, and no condition or event exists or has occurred that would have a
Material Adverse Effect.
6.13 The representations and warranties made by the Company in the
Securities Agreement are hereby made to Baxter as if set forth herein.
In addition, the Company makes the following covenant:
6.14 In the event that Baxter purchases the Put Stock, or Baxter sells or
causes to be sold the Put Stock to a third party because Baxter is prohibited
from purchasing or owning such stock, due to any law, rule, regulation, order or
ruling of any court or governmental entity having jurisdiction over Baxter, the
Company agrees to extend to Baxter or to such third parties, as the case may be,
the same rights extended to the original holders of the Subject Securities under
the Registration Rights Agreement between the Company and the signatories
thereto dated of even date herewith.
SECTION 7. REPRESENTATIONS AND WARRANTIES OF BAXTER.
7.1 Baxter represents and warrants that the information provided in
writing by Baxter specifically for use in the Private Placement Memorandum, as
updated by Baxter from time to time, does not, at the time it is furnished to
the Company for use in the Private Placement Memorandum or at the time of the
Private Placement Closing, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they are made, not misleading. Except as specifically set forth in the previous
sentence, Baxter makes no representation or warranty with respect to the Private
Placement Memorandum.
7.2 Baxter further represents and warrants to the Company as follows:
7.2.1 This Put Agreement has been duly authorized, executed and
delivered by Baxter and constitutes the valid and legally binding obligation of
Baxter enforceable against it in accordance with its terms.
7.2.2 The execution, delivery and performance of this Put Agreement
and the purchase by Baxter of the Put Stock upon the exercise by the Holder of
the Put Right in accordance with the terms of the Put Right Certificate will not
violate or constitute a default under any term of the charter or by-laws of
Baxter or any term of any agreement, document, instrument, judgment, decree,
order, law, statute, rule or regulation applicable to Baxter or any of its
properties and assets.
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7.2.3 Other than any notification that may be required under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), in connection with the purchase by Baxter of the Put Stock, no consent,
approval or authorization of, or declaration or filing with, or other action by,
any Person (including, without limitation, any governmental authority) is
required, in any such case that is applicable to Baxter, as of the date hereof
as a condition precedent to the valid execution, delivery and performance by
Baxter of this Put Agreement and/or the purchase by Baxter of the Put Stock upon
the exercise by the Holder in accordance with the terms of the Put Right
Certificate. In the event that any notification is required under the HSR Act in
connection with the purchase by Baxter of the Put Stock, or in the event any
other consent, approval or authorization of, or declaration or filing with, or
other action by, any person (including, without limitation, any governmental
authority) is required after the date hereof as a condition precedent to the
performance by Baxter of this Put Agreement and/or the purchase by Baxter of the
Put Stock upon the exercise of the Put Rights, then the parties shall perform
their respective obligations as set forth in Section 11(e) of the Put Right
Certificates.
SECTION 8. CONDITIONS.
8.1 Conditions to Baxter's Obligation to Issue Put Rights. The
obligation of Baxter to issue the Put Rights at the Private Placement Closing
Date shall be subject to the satisfaction (or waiver in writing by Baxter) on or
prior to the Private Placement Closing of the following conditions.
8.1.1 Representations and Warranties; Covenants. The
representations and warranties of the Company contained in this Agreement shall
be true and correct in all material respects as of the Private Placement Closing
Date, and there shall be no breach or failure to perform any of the covenants
and agreements of the Company contained in this Agreement which has not been
cured on or prior to the Private Placement Closing Date.
8.1.2 No Material Adverse Change. Subsequent to the date of the
most recent financial statements in the Private Placement Memorandum and except
as set forth in the Private Placement Memorandum, the Company's filings with the
SEC or the Securities Agreement, there has been no material adverse change in
the business, assets, liabilities, results of operations or financial condition
of the Company or the ability of the Company to perform its obligations under
this Agreement or to consummate the transactions contemplated hereby or thereby.
8.1.3 Validity of Private Placement. The Company shall not have
taken or failed to take any action, at any time at or prior to Private Placement
Closing Date, which conflicts or could reasonably be expected to conflict with,
or otherwise makes unavailable, the exemption for the offering and sale of the
Series B Preferred, Put Rights and Warrants from the registration provisions of
the Securities Act, or from any applicable state securities or blue sky laws,
rules and regulations. The issuance and sale of the Series B Preferred, Put
Rights and Warrants in the Private Placement shall be legally permitted under
applicable blue sky or state securities laws.
9
<PAGE>
8.1.4 Closing Documents. The Company shall have delivered to Baxter
the following documents:
(a) a certificate signed by the Chief Executive Officer,
President or the Chief Financial Officer, dated the Closing Date, certifying the
Purchase Price and certifying that the conditions specified in Sections 8.1.1
and 8.1.2 have been satisfied;
(b) certified copies of resolutions duly adopted by the
Company's Board of Directors authorizing: (A) the execution, delivery and
performance of this Agreement; and (B) the Private Placement;
(c) a reliance letter from outside counsel to the Company
permitting Baxter to rely on the opinion given on the Closing Date to the
purchasers under the Securities Agreement;
(d) the Side Letter executed by the Company; and
(e) such other documents relating to the transactions
contemplated by this Agreement as Baxter or its counsel may reasonably request.
8.2 Conditions to the Company's Obligation to Effect the Private
Placement. The obligation of the Company to effect the Private Placement shall
be subject to the satisfaction (or waiver in writing by the Company) on or prior
to the Private Placement Closing Date of the following conditions.
8.2.1 Representations and Warranties; Covenants. The
representations and warranties of Baxter contained in this Agreement shall be
true and correct in all material respects as of the Private Placement Closing
Date and there shall be no breach or failure to perform any of the covenants and
agreements of Baxter contained in this Agreement which has not been cured on or
prior to the Private Placement Closing Date.
8.2.2 Compliance with Law; No Litigation or Other Adverse Effect.
Subject to the provisions of Section 11 (e) of the Put Right Certificates, the
issuance of the Put Rights by Baxter hereunder and the performance by Baxter of
the transactions contemplated hereby shall not be prohibited by any applicable
law, administrative or governmental rule or regulation or order of a court of
competent jurisdiction. No action, suit or proceeding shall exist or be
threatened, to the knowledge of Baxter, that would prevent, restrain or
condition in any material respect the issuance of the Put Rights by Baxter in
the Private Placement, and no condition or event shall exist or occur that would
have a material adverse effect on the ability of Baxter to consummate the
transactions contemplated hereby.
8.2.3 Closing Documents. Baxter shall have delivered to the Company
a certificate signed by an officer of the Company, dated the Closing Date,
certifying that the conditions specified in Sections 8.2.1 and 8.2.2 have been
satisfied.
8.2.4 Side Letter. Baxter shall have delivered to the Company the
Side Letter executed by Baxter.
10
<PAGE>
SECTION 9. TERMINATION.
This Agreement may be terminated:
9.1 by mutual written consent of Baxter and the Company; or
9.2 automatically, without any action by Baxter or the Company, if the
Private Placement Closing has not occurred by November 30, 1999.
SECTION 10. GENERAL.
10.1 Adjustments for Stock Splits, Consolidations, Etc. The initial
designation of Put Stock, the Purchase Price and the Put Purchase Price are
based on the Series B Preferred as constituted as of the date of this Agreement.
If the Company shall at any time after the date of this Agreement (i) declare a
dividend on Series B Preferred (or any other Put Stock) payable in shares of its
capital stock, (ii) subdivide the outstanding Series B Preferred (or any other
Put Stock), (iii) combine the outstanding Series B Preferred (or any other Put
Stock) into a smaller number of shares of Series B Preferred (or any other Put
Stock) or (iv) issue any shares of its capital stock in a reclassification of
the Series B Preferred (or any other Put Stock) (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), the Purchase Price and Put
Purchase Price in effect at the time of the record date for such dividend or of
the effective date of such subdivision, combination or reclassification, and the
number and kind of shares of capital stock subject to such Put Rights on such
date, shall be proportionately adjusted so that upon exercise by the holders of
the Put Rights (the "Holders") Baxter shall be entitled to receive the aggregate
number and kind of shares of capital stock upon payment of the Put Purchase
Price which, if such Put Rights had been exercised immediately prior to such
date and at a time when the Series B Preferred (or other Put Stock, as the case
may be) transfer books of the Company were open, Baxter would have owned upon
such exercise and payment and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification.
Not later than 10 business days prior to the record date of any such
dividend or the effective date for any such subdivision, combination or
reclassification, the Company shall send to Baxter a certificate signed by its
Chief Financial Officer setting forth in reasonable detail a description of such
dividend, subdivision, combination or reclassification and all adjustments to be
made pursuant to this Section 9 to the Purchase Price and Put Purchase Price and
the number and kinds of capital stock subject to the Put Rights. The adjustments
set forth in such certificate shall be binding on the Company, Baxter and the
Holders unless, within 30 days following receipt of such certificate, either
Baxter or Holders representing not less than 66-2/3% in interest of the Put
Stock shall notify the Company and each of the Holders or Baxter, as applicable,
of its or their disagreement with such adjustments, in which event such
adjustment will be determined (at the expense of the Company) by a firm of
independent certified public accountants of recognized national standing
selected by the Company and reasonably satisfactory to Baxter and the Holders of
more than 75% in interest of the Put Stock at the time outstanding and shall be
set forth in a separate report from such accountants delivered promptly to the
Company, the Holders and Baxter following the determination by such accountants.
11
<PAGE>
10.2 Binding Agreement. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective permitted successors and
assigns.
10.3 Assignment. Neither party hereto may assign or transfer this
Agreement without the prior written consent of the other party hereto; provided,
however, that either party hereto may assign this Agreement to any Person with
or into which such party may merge or consolidate or to whom all or
substantially all of its assets or businesses may be sold and that Baxter may
assign this Agreement to any wholly-owned subsidiary of Baxter, provided that
Baxter remains liable for its obligations hereunder.
10.4 Entire Agreement. This Agreement and the Put Right Certificates
evidencing the Put Rights set forth the entire understanding of the parties
hereto with respect to the subject matter hereof and thereof and supersede all
prior agreements, written and oral, among the parties hereto as to such subject
matter.
10.5 Waiver. The waiver by either party hereto of any breach of any
provision of this Agreement shall not constitute or operate as a waiver of any
other breach of such provision or of any other provision hereof, nor shall any
failure to enforce any provision hereof operate as a waiver of such provision or
of any other provision hereof.
10.6 Expenses. Except as expressly provided in this Agreement and subject
to any rights based on a breach of this Agreement, each party hereto shall bear
its own costs and expenses incident hereto.
10.7 Amendments. This Agreement may not be amended, nor may any provision
hereof be modified or waived, except by an instrument in writing duly signed by
both parties hereto.
10.8 Notices. All notices and other communications required or permitted
to be given hereunder shall be deemed sufficiently given if sent by certified
mail, postage prepaid, return receipt requested, by facsimile transmission (with
receipt confirmed) or by air courier service (with receipt confirmed), addressed
as follows:
If to the Company:
Nexell Therapeutics, Inc.
9 Parker
Irvine, CA 92618-1605
Attention: President
Facsimile: (949) 470-6645
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<PAGE>
with a copy to:
Bryan Cave LLP
120 Broadway, Suite 300
Santa Monica, CA 90401-2305
Attention: Thomas S. Loo
Facsimile: (310) 576-2200
If to Baxter:
Baxter International Inc.
One Baxter Parkway
1627 Lake Cook Road
Deerfield, IL 60015-4633
Attention: Treasurer
Facsimile: (847) 848-4509
with a copy to:
Baxter International Inc.
One Baxter Parkway
1627 Lake Cook Road
Deerfield, IL 60015
Attention: General Counsel
Facsimile: (847) 948-2450
or at such other address as it may have furnished in writing to the other party
hereto.
10.9 Severability. If any provision of this Agreement shall be held
invalid, illegal or unenforceable, the validity, legality or enforceability of
the other provisions hereof shall not be affected thereby, and there shall be
substituted for the provision at issue a valid and enforceable provision as
similar as possible to the provision at issue.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois, without reference to the
principles of conflict of laws thereof.
10.11 Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect the meaning, interpretation, enforceability
or validity of this Agreement.
10.12 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same document.
* * *
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<PAGE>
In Witness Whereof, the Company and Baxter have each caused this Agreement
to be executed by their duly authorized officers as of the date first written
above.
Nexell Therapeutics Inc.
By: __________________________________
Name: ________________________________
Title: _______________________________
Baxter International Inc.
By: __________________________________
Name: ________________________________
Title: _______________________________
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<PAGE>
EXHIBIT A
FORM OF PUT RIGHT CERTIFICATE
<PAGE>
EXHIBIT B
FORM OF SIDE LETTER
<PAGE>
EXHIBIT 7.8
Form of Put Right Certificate
The Put Rights evidenced by this Certificate were originally issued on November
24, 1999 and have not been registered or qualified under the Securities Act of
1933, as amended, or any state securities laws, and may not be sold or
transferred unless (A) the same number of shares of Put Stock (as defined
herein) underlying the Put Rights so transferred are concurrently transferred to
the same transferee and (B) such Put Rights or Put Stock (as defined herein)
underlying such put rights so transferred are registered or qualified pursuant
to such Act and applicable state securities laws or an exemption therefrom under
said Act or such applicable State securities laws is available.
The Put Rights evidenced by this Certificate are subject to certain restrictions
on transfer and certain rights specified in this Put Right Certificate and in
the Securities Agreement dated as of November 24, 1999, as amended from time to
time, between Nexell Therapeutics Inc. and the original holder of this
Certificate and the other parties that are signatories thereto, a copy of which
will be mailed to any requesting Holder by Nexell Therapeutics Inc. within five
days of written request therefor.
The Put Rights evidenced by this Certificate expire at 5:00 p.m., New York, New
York Time, on November 24, 2004 (or at such earlier time as may be prescribed by
Section 7 hereof) and may not be exercised after such date.
Certificate No. R-___ __________ Put Rights
Date: _____________________ PPN 65332H 5#7
In Witness Hereof, the undersigned, Baxter International Inc., a Delaware
corporation ("Baxter"), hereby certifies and agrees that
_______________________________, or registered assigns (the "Holder"), is the
owner of the number of Put Rights set forth above (the "Put Rights"), each of
which entitles the Holder to cause Baxter to purchase for cash from the Holder
the Put Stock (as defined herein) of Nexell Therapeutics Inc., a Delaware
corporation ("Nexell"), at the Purchase Price (as defined herein) during the
Exercise Period (as defined herein).
Section 1. Definitions. Capitalized terms used herein, unless otherwise
defined, shall have following meanings:
"Acceptable Acquiring Company" shall mean a corporation (a) engaged in the
health care business, (b) whose common stock is at the time listed on a national
securities exchange or traded
EXHIBIT B
(to Securities Agreement)
<PAGE>
on the NASDAQ National Market and is current in its periodic reporting with the
Securities and Exchange Commission and (c) which has annual revenues of at least
$500,000,000 and a market capitalization of at least $2 billion.
"Affiliate" shall mean any Person (a) which directly or indirectly through
one or more intermediaries controls, or is controlled by, or is under common
control with, a Holder, (b) which beneficially owns or holds 10% or more of any
class of the Voting Stock of a Holder or (c) 10% or more of the Voting Stock (or
in the case of a Person which is not a corporation, 10% or more of the equity
interest) of which is beneficially owned or held by a Holder. The term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of Voting Stock, by contract or otherwise.
"Approved Significant Transaction" is defined in Section 7(c)(iii).
"Closing Date" shall mean the date on which the transactions contemplated
by the Securities Agreement were consummated, which date is November 24, 1999.
"Competitive Business Line" shall mean either (a) the business of cellular
therapy or the development of health care products involving cellular therapy or
(b) the sale, marketing or manufacture of medical devices for use in the health
care industry.
"Competitor" shall mean (a) any Person which is engaged in a Competitive
Business Line or (b) any Person which at the time owns more than forty percent
(40%) of the Voting Stock of such Competitor and in connection therewith
exercises control over management of a Person that is engaged in a Competitive
Business Line, provided in any event that:
(i) the provision of investment advisory services by a Person to
a Plan which is owned or controlled by a Person which would otherwise be a
Competitor shall not in any event cause the Person providing such services
to be deemed to be a Competitor;
(ii) in no event shall an Institutional Holder be deemed a
Competitor unless such Institutional Holder owns or holds more than 50% of
the Voting Stock of, and in connection therewith exercises control over
management of, a Person that is engaged in a Competitive Business Line;
(iii) in no event shall an Institutional Holder be deemed a
Competitor if such Institutional Holder is a pension plan sponsored by a
Person which would otherwise be a Competitor but which is a regular
investor in privately placed securities and such pension plan has
established procedures which will prevent confidential information supplied
to such pension plan by the Company from being transmitted or otherwise
made available to such plan sponsor; and
(iv) an Institutional Holder that would otherwise be deemed a
Competitor pursuant to the foregoing provisions of this definition by
virtue of its ownership or control as a portfolio investment of the equity
securities of any Person primarily engaged in a
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<PAGE>
Competitive Business Line, shall not be deemed a Competitor if such
Institutional Holder has established procedures which will prevent
confidential information supplied to such Institutional Holder by the
Company from being transmitted or otherwise made available to such Person.
"Institutional Holder" shall mean (a) any original Holder of Put Right
Certificates and (b) any bank, trust company, savings and loan association or
other financial institution, any pension plan, any investment company, any
insurance company, any broker or dealer, or any other similar financial
institution or entity, regardless of legal form.
"Overdue Rate" means that rate of interest that is 1% over the rate of
interest publicly announced by Citibank, N.A. in New York, New York (or its
successors) as its "base" or "prime" rate.
"Person" shall mean any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
institution, entity, limited liability company or government (whether national,
Federal, state, county, city, municipal or otherwise, including, without
limitation, any instrumentality, division, agency, body or department thereof).
"Put Stock" shall mean the capital stock of Nexell that Baxter is required
to purchase upon exercise of the Put Rights evidenced by this Put Right
Certificate and the other similar Put Right Certificates issued in connection
with the Securities Agreement. Initially, the Put Stock shall be the shares of
Series B Cumulative Convertible Preferred Stock, $0.001 par value, of Nexell
issued concurrently with the Put Right Certificates on the Closing Date. The
Put Stock may be adjusted from time to time for any of the events set forth in
Section 8. Neither the Class A Warrants nor the Class B Warrants of Nexell
issued pursuant to the Securities Agreement shall constitute "Put Stock."
"Required Holders" shall mean the holder or holders of not less than 10% in
interest of the Put Stock at the time outstanding.
"Securities Agreement" shall mean the Securities Agreement, dated as of
November 24, 1999, between Nexell and the purchasers named therein pursuant to
which this Put Right Certificate, the Put Stock and certain warrants to purchase
common stock of Nexell were issued and sold.
"Subsidiary" shall mean, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries).
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<PAGE>
"Voting Stock" shall mean securities of any class or classes, the holders
of which are ordinarily, in the absence of contingencies, entitled to elect a
majority of the corporate directors (or Persons performing similar functions).
Section 2. Grant of Put Right. Baxter hereby grants to the Holder the
Put Rights evidenced by this Put Right Certificate to cause Baxter to purchase
all (but not less than all) of the Put Stock held at the time of exercise by
such Holder and then held by all of such Holder's Affiliates at any time during
the period beginning at 9:00 a.m. (New York, New York time) on November 24, 2002
and ending at 5:00 p.m. (New York, New York time) on November 24, 2004 (the
"Exercise Period") for an aggregate cash purchase price (the "Purchase Price")
as calculated pursuant to Section 4(b) below. Baxter agrees to so purchase from
the Holder, upon exercise of the Put Rights, the Put Stock for the Purchase
Price.
Section 3. Method of Exercise. The Holder may exercise the Put Rights
hereby granted to it on any date during the Exercise Period by executing and
delivering to Baxter (i) a written notice of exercise (the "Exercise Notice"),
(ii) a copy of this Put Right Certificate, and (iii) a copy of the Put Stock
certificates representing all of the Put Stock held by such Holder to be
purchased by Baxter, duly endorsed for transfer or accompanied by a duly
executed instrument of assignment at the office for notices to Baxter as
prescribed in Section 20. The original certificates representing the Put Stock
shall be delivered to Baxter at the time of payment by Baxter of the Purchase
Price. Baxter agrees that, within ten (10) business days after receiving the
Exercise Notice, it will notify all other holders who have outstanding Put
Rights with respect to any Put Stock that Baxter has received such Exercise
Notice.
Section 4. Payment of Purchase Price. (a) On or before the 30th day (or
pursuant to Section 10(d), the 46th day) after receipt of the Exercise Notice
(the "Payment Date"), Baxter agrees that it shall pay in full the Purchase Price
to the exercising Holder by Federal wire transfer of immediately available funds
to an account, or by such other reasonable means, specified by the Holder in the
Exercise Notice.
(b) The Purchase Price to be paid by Baxter shall be an amount equal to
(i) $1000.00 per share of Put Stock to be purchased (subject to adjustment as
provided in Section 8) multiplied by the rate of 105.91% per annum (computed on
the basis of a 360-day year of twelve 30-day months), compounded semi-annually
for the period beginning on the Closing Date to and including the date on which
the Purchase Price is paid, less (ii) an amount equal to the product of (A) the
aggregate amount of cash dividends received by the Holder in respect of each
such share during the same period and (B) 0.50.
(c) Baxter may elect to cause one of its Subsidiaries to purchase the Put
Stock. In such event, upon written notice to the Holder, Baxter will cause full
payment to be made by such Subsidiary to the Holder and the Holder shall make
delivery of the original certificates to such Subsidiary upon receipt of the
payment of the Purchase Price, thus satisfying the obligations of both Baxter
and the Holder under this Section 4. Notwithstanding the foregoing, the
election by Baxter to cause a Subsidiary to purchase the Put Stock shall not
relieve Baxter of its obligations as the primary obligor under this Put Right
Certificate.
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<PAGE>
Section 5. Default by Baxter. The performance by Baxter of the
obligations set forth herein shall not be excused by reason of any failure by
Baxter to have sufficient funds required to satisfy said obligations or by
reason of any restriction, whether direct or indirect, and of whatever nature,
on the ability of Baxter to satisfy said obligations. Without limiting the
foregoing, any amounts payable hereunder in respect of the Put Rights shall bear
interest at the Overdue Rate, compounded semi-annually, from the Payment Date
to, but not including, the date of actual payment thereof. In the event and to
the extent that Baxter shall fail, for any reason, to satisfy any obligation
hereunder, in addition to any other rights and remedies the Holder may have at
law or in equity, the Holder shall retain its position as a holder of the Put
Stock with full right to exercise its rights as a holder of the Put Stock
without regard to having previously sent an Exercise Notice to Baxter.
Section 6. Transfer Restrictions. (a) Subject to the further
provisions of this Section 6, the Put Rights evidenced by this Put Right
Certificate may be transferred or assigned by the Holder in whole or in part and
from time to time.
(b) The Put Rights evidenced by this Put Right Certificate may not be
transferred by the Holder except upon the concurrent transfer to the same
transferee of the number of shares of Put Stock underlying the Put Rights so
transferred (the "Underlying Put Stock"). Any purported transfer of Put Rights
without the concurrent transfer of such number of Underlying Put Stock to the
same transferee shall be deemed invalid and of no force or effect.
(c) This Put Right Certificate shall not be transferable or assignable to
any Competitor of Baxter or of Nexell. Any purported transfer of Put Rights to
a Competitor shall be deemed invalid and of no force or effect.
(d) The Put Rights evidenced by this Put Right Certificate shall not be
transferable or assignable in part in denominations of less than 5% of the
aggregate number of all shares of Put Stock at the time outstanding (or such
lesser amount as shall constitute the Holder's entire investment in the Put
Stock).
(e) This Put Right Certificate shall not be transferable or assignable
unless a registration statement with respect hereto has become effective under
the Securities Act of 1933, as amended, or any applicable state securities laws,
or unless an exemption from such registration is available with respect hereto.
Section 7. Termination. The Put Rights evidenced by this Put
Right Certificate and all of the rights and obligations of the parties hereunder
shall terminate upon the earliest to occur of:
(a) November 24, 2004;
(b) with respect to each Put Right, the date on which the Holder
converts the Put Stock underlying such Put Right evidenced by this Put
Right Certificate into shares of Nexell's common stock; and
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<PAGE>
(c) the effective date of any merger, consolidation or
reorganization of Nexell in which Nexell is not the surviving entity (a
"Significant Transaction") and:
(i) the Holder of this Put Right Certificate receives cash or
cash equivalents in respect of 100% of the Put Stock underlying the
Put Rights evidenced by this Put Right Certificate in an amount
greater than (A) in the case of a Significant Transaction occurring on
or prior to November 24, 2002, $4.26 per share of common stock of
Nexell issuable upon conversion of the Put Stock (as adjusted for any
stock dividends, stock splits, stock combinations, recapitalizations
and similar events) and (B) in the case of a Significant Transaction
occurring after November 24, 2002 and on or prior to November 24,
2004, $4.95 per share of common stock of Nexell issuable upon
conversion of the Put Stock (as so adjusted); or
(ii) the Holder of this Put Right Certificate receives common
stock (or equivalent equity interests) of an Acceptable Acquiring
Company in respect of 100% of the Put Stock underlying the Put Rights
evidenced by this Put Right Certificate valued (as provided below) at
greater than (A) in the case of a Significant Transaction occurring on
or prior to November 24, 2002, $4.26 per share of common stock of
Nexell issuable upon conversion of the Put Stock (as adjusted for any
stock dividends, stock splits, stock combinations, recapitalizations
and similar events) and (B) in the case of a Significant Transaction
occurring after November 24, 2002 and on or prior to November 24,
2004, $4.95 per share of common stock of Nexell issuable upon
conversion of the Put Stock (as so adjusted); such valuation shall be
(x) determined, at the expense of Nexell, by an independent investment
banking firm selected by Nexell and reasonably satisfactory to the
holders of 66-2/3% or more of the Put Stock then outstanding and (y)
delivered in writing to all Holders of the Put Rights prior to the
effective date of such Significant Transaction; or
(iii) in connection with a Significant Transaction where
neither (i) nor (ii) above applies, the Holder of this Put Right
Certificate receives such consideration in respect of 100% of the Put
Stock underlying the Put Rights evidenced by this Put Right
Certificate as shall be approved by the holders of 75% or more of the
Put Stock then outstanding (an "Approved Significant Transaction").
Section 8. Dilution Adjustments. If, at any time or times after
the original issuance of this Put Right Certificate on the Closing Date, Nexell
shall (a) declare a dividend on the Put Stock payable in shares of its capital
stock, (b) subdivide the outstanding Put Stock, (c) combine the outstanding Put
Stock into a smaller number of shares of Put Stock or (d) issue any shares of
capital stock or other securities of Nexell or another company in exchange for
the Put Stock (whether by reason of merger, consolidation, recapitalization,
reclassification, reorganization, split-up, combination of shares or otherwise),
then the Purchase Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, combination, merger,
consolidation, recapitalization, reclassification or reorganization, and the
number and kind of Put
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<PAGE>
Stock (or other shares of capital stock or other securities) subject to such Put
Rights on such date, shall be proportionately adjusted so that upon the exercise
by the Holder of the Put Rights evidenced by this Put Right Certificate, Baxter
shall be required to purchase the aggregate number and kind of Put Stock (or
other shares of capital stock or other securities) upon payment of the Purchase
Price which, if such Put Rights had been exercised immediately prior to such
date and at a time when the Put Stock transfer books of Nexell were open, Baxter
would have owned upon such exercise and payment, or have been entitled to
receive, by virtue of such dividend, subdivision, combination, merger,
consolidation, recapitalization, reclassification or reorganization. Not fewer
than 30 days prior to the record date for any such dividend or the effective
date for any such subdivision, combination, merger, consolidation,
recapitalization, reclassification or reorganization, Nexell shall send to the
Holder and to Baxter a certificate signed by its chief financial officer (i)
setting forth in reasonable detail a description of such dividend, subdivisions,
combination, merger, consolidation, recapitalization, reclassification or
reorganization and all adjustments to be made pursuant to this Section 8 to the
Purchase Price and to the number and kind of Put Stock (or other shares of
capital stock or other securities) subject to the Put Rights evidenced by this
Put Right Certificate and (ii) referencing this Section 8 and the right of
Baxter and the Required Holders to challenge such adjustments within 30 days
following receipt of such officer's certificate in the manner set forth in the
following sentence. The adjustments set forth in such officer's certificate
shall be binding on Nexell, Baxter and the Holder unless, within 30 days
following receipt of such officer's certificate, either Baxter or the Required
Holders shall notify Nexell and each of the Holders of Put Right Certificates or
Baxter, as applicable, of its or their disagreement with such adjustment, in
which event such adjustments shall be determined (at the expense of Nexell) by a
firm of independent certified public accountants of recognized national standing
selected by Nexell and reasonably satisfactory to Baxter and the holders of more
than 66-2/3% in interest of the Put Stock at the time outstanding and shall be
set forth in a separate report from such accountants delivered promptly to
Nexell, the Holders and Baxter following the determination by such accountants.
Section 9. Status of Purchased Put Stock. The Put Stock shall be
deemed to be issued and outstanding for purposes of this Put Right Certificate
and for all other purposes until such time as Baxter shall deliver to the Holder
the Purchase Price as provided in Section 4, after which time the Put Stock
shall be deemed to have been acquired by Baxter. Upon acquisition by Baxter,
the Put Stock shall be deemed owned and held by Baxter and shall remain
outstanding for all purposes.
Section 10. Purchase of Put Right Certificates. Baxter will not,
directly or indirectly, through any subsidiary or affiliate or otherwise,
purchase or make any offer to purchase any of the Put Right Certificates, unless
the offer has been made to repurchase the Put Right Certificates pro rata from
all Holders thereof at the same time and at the same price and upon the same
terms. Upon the exercise of all or any portion of any Put Right Certificate and
complete performance by Baxter pursuant thereto, such Put Right Certificate or
portion thereof as exercised shall be cancelled and Baxter shall have no status
for any purpose as a Holder of any Put Right Certificate.
Section 11. Representations and Warranties of Baxter. Baxter hereby
represents and warrants to the Holder that, on the date this Put Right
Certificate is issued:
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<PAGE>
(a) The execution and delivery of this Put Right Certificate and
compliance by Baxter with all of the provisions hereof (i) are within the
corporate powers of Baxter, (ii) have been duly authorized by all necessary
corporate action on the part of Baxter, and (iii) are legal and will not
conflict with nor result in any breach of any of the provisions of, or
constitute a default under, or result in the creation of any lien or
encumbrance upon any property of Baxter under the provisions of, any loan
agreement, charter instrument, by-law or other agreement or instrument to
which Baxter is a party or by which it may be bound or to which any of its
properties may be subject.
(b) This Put Right Certificate has been duly executed and delivered
by Baxter and constitutes the legal, valid and binding obligation of Baxter
enforceable in accordance with its terms.
(c) The Put Agreement dated as of November 24, 1999 between Nexell
and Baxter is in full force and effect, all conditions precedent required
by Baxter to the issuance of this Put Right Certificate as provided in the
Put Agreement have been satisfied without waiver and no default under the
Put Agreement has occurred.
(d) There will be provided to Baxter a substantial economic benefit
and adequate consideration for the execution and delivery of this Put Right
Certificate because, among other reasons, a portion of the proceeds from
the original issuance of the Series B Preferred Stock will be used by
Nexell to prepay in full certain 6-1/2% subordinated debentures of Nexell
held by Baxter and because Baxter owns other capital stock in Nexell.
(e) Neither the nature of Baxter, its business or property, nor any
relationship between Baxter and any other Person, nor any circumstances in
connection with the execution and delivery of this Put Right Certificate or
the purchase of the Put Stock required hereunder is such as to require a
consent, approval or authorization of, or filing, registration or
qualification with, any governmental authority or any stock exchange on the
part of Baxter in connection with the execution, delivery and performance
hereof, except that notification may be required under the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), in
connection with the actual purchase of the Put Stock. In the event that
any notification is required under the HSR Act in connection with the
purchase by Baxter of the Put Stock, or in the event any other consent,
approval or authorization of, or declaration or filing with, or other
action by, any person (including, without limitation, any governmental
authority) is required after the date hereof as a condition precedent to
the performance by Baxter of this Put Right Certificate and/or the purchase
by Baxter of the Put Stock, upon the exercise by the Holder in accordance
with the terms hereof, then each of Baxter, Nexell and, at the request of
Baxter, the Holder shall use its reasonable best efforts to obtain the same
not later than the date upon which Baxter is obligated to perform its
obligations hereunder; provided that Baxter shall pay all out-of-pocket
expenses incurred by the Holder in connection therewith. If any such
condition precedent cannot be satisfied or rendered inapplicable to such
performance or purchase on or prior to the 45th day following the exercise
of the Put Right evidenced by this Put Right Certificate in accordance with
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<PAGE>
Section 3, then (i) on the 46th day following such exercise, Baxter shall
pay (in accordance with Section 4) the Purchase Price with respect to the
Put Stock as to which the Put Rights have been so exercised and (ii) from
and after such date, the Holder shall, at Baxter's sole direction, deposit
such Put Stock in an escrow, a voting trust or other similar arrangement,
hold such Put Stock in trust for the benefit of Baxter or otherwise hold or
dispose of such Put Stock at Baxter's sole written direction and hold or
distribute the proceeds of any sale, redemption or other disposition of
such Put Stock at Baxter's sole written direction; provided that Baxter
shall pay all out-of-pocket expenses incurred by such Holder in connection
therewith and shall indemnify such Holder from all claims which might be
made against such Holder in following Baxter's directions pursuant to this
Section 11(d).
Section 12. Notice Not Required. Baxter hereby waives, to the fullest
extent permitted by law, any right to require that any action on or in respect
of any shares of Put Stock be brought against Nexell or that resort be had to
any direct or indirect security for the Put Stock or any other remedy before
proceeding hereunder against Baxter. The liability of Baxter hereunder shall, to
the fullest extent permitted by law, in no way be affected or impaired by any
acceptance by the Holder of any direct or indirect security for, or other
guaranties of, any indebtedness, liability or obligation of Nexell or any other
person to the Holder or by any failure, delay, neglect or omission by the Holder
to realize upon or protect any such indebtedness, liability or obligation or any
shares of Put Stock or other instrument evidencing the same or any direct or
indirect security therefor or by any approval, consent, waiver or other action
taken, or omitted to be taken, by the Holder. Baxter hereby waives any and all
defenses, counterclaims or offsets which it might or could have by reason
thereof, it being understood that Baxter shall at all times be bound by this Put
Right Certificate and remain liable hereunder.
Section 13. Nature of Obligations. (a) The obligations of Baxter under this
Put Right Certificate and the rights of the Holder to enforce such obligations
by any proceedings, whether by action at law, suit in equity or otherwise, are
absolute, unconditional and irrevocable and shall not be subject to any
reduction, limitation, impairment or termination, whether by reason of any claim
of any character whatsoever or otherwise and shall not be subject to any
defense, set-off, counterclaim, reduction or deduction whatsoever.
(b) The obligations of Baxter hereunder shall be binding upon Baxter and
its successors and assigns, and shall, to the fullest extent permitted by law,
remain in full force and effect irrespective of:
(1) the genuineness, validity, regularity or enforceability of the
Put Stock or any other instruments relating thereto or any of the terms of
any thereof, the continuance of any obligation on the part of Nexell or any
other person on the Put Stock or the power or authority or the lack of
power or authority of Nexell to issue the Put Stock or execute and deliver
the Certificate of Designation or the Securities Agreement or to perform
any of its obligations thereunder or the existence or continuance of Nexell
or any other person as a legal entity; or
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<PAGE>
(2) any default, failure or delay, willful or otherwise, in the
performance by Nexell or any other person of any obligations of any kind or
character whatsoever of Nexell or any other person (including, without
limitation, the obligations and undertakings of Nexell or any other person
under the Put Stock, the Certificate of Designation, the Securities
Agreement or otherwise); or
(3) any creditors' rights, bankruptcy, stay, receivership or other
insolvency proceeding of Nexell or any other person or in respect of the
property of Nexell or any other person or any merger, consolidation,
reorganization, dissolution, liquidation or winding up of Nexell or any
other person; or
(4) impossibility or illegality of performance on the part of
Nexell or any other person of its obligations under the Put Stock, the
Certificate of Designation, the Securities Agreement, or any other
instruments; or
(5) in respect of Nexell or any other person, any change of
circumstances, whether or not foreseen or foreseeable, whether or not
imputable to Nexell or any other person, or other impossibility of
performance through action of any Federal or state regulatory body or
agency, change of law or any other causes affecting performance, or any
other force majeure, whether or not beyond the control of Nexell or any
other person and whether or not of the kind hereinbefore specified; or
(6) the failure of Baxter to receive any benefit from or as a
result of its execution, delivery and performance of this Put Right
Certificate; or
(7) any assignment, sale, transfer or other disposition by Baxter
of all or any portion of its investment in the capital stock of Nexell,
except any such transaction which expressly results in the termination of
the Put Rights as provided in Section 7(c); or
(8) any failure or lack of diligence in collection or protection,
failure in presentment or demand for payment, protest, notice of protest,
notice of default and of nonpayment, any failure to give notice to Baxter
of failure of Nexell or any other person to keep and perform any
obligation, covenant or agreement under the terms of the Put Stock, the
Certificate of Designation, the Securities Agreement, or failure to resort
for payment to Nexell or to any other person or to any guaranty or to any
property, security, liens or other rights or remedies; or
(9) any defense whatsoever that Nexell or any other person might
have to the obligations in respect of the Put Stock or to the performance
or observance of any of the provisions of the Certificate of Incorporation,
whether through the satisfaction or purported satisfaction by Nexell or any
other person of its debts due to any cause such as bankruptcy, insolvency,
receivership, merger, consolidation, reorganization, dissolution,
liquidation, winding-up or otherwise; or
(10) any act or failure to act with regard to the Put Stock, the
Certificate of Designation, the Securities Agreement or anything which
might vary the risk of Baxter; or
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<PAGE>
(11) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, Baxter in respect of the
obligations of Baxter under this Put Right Certificate;
provided, however, that the specific enumeration of the above-mentioned acts,
failures or omissions shall not be deemed to exclude any other acts, failures or
omissions, though not specifically mentioned above, it being the purpose and
intent of this Put Right Certificate that the obligations of Baxter shall be
absolute and unconditional and shall not be discharged, impaired or varied
except on the terms expressly provided in this Put Right Certificate.
Section 14. Rank of Obligation. The obligations of Baxter under this Put
Right Certificate rank pari passu in right of payment with all other
indebtedness (actual or contingent) of Baxter which is not secured or the
subject of any statutory trust or preference or which is not expressly
subordinated in right of payment to any other indebtedness.
Section 15. Expenses. Baxter agrees to pay directly all of the expenses of
the Holder (a) in connection with any amendments, waivers or consents requested
by Baxter pursuant to the provisions of this Put Right Certificate including
those resulting from any work-out, renegotiation or restructuring relating to
the performance by Baxter of its obligations under this Put Right Certificate
and all related costs and expenses (including, without limitation, reasonable
attorney fees, but excluding internal legal costs and expenses allocated by a
Holder to such matters) (b) incurred in enforcing or defending any rights under
or in respect of this Put Right Certificate (excluding internal legal costs and
expenses allocated by a Holder to such matters), provided that Baxter shall only
be required to pay such expenses if the Holder enforcing or defending its rights
hereunder shall prevail in the proceedings arising from such enforcement or
defense.
Section 16. Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial. This Put Right Certificate, including the validity hereof and the
rights and obligations of the parties hereunder, and all amendments and
supplements hereof and all waivers and consents hereunder, shall be construed in
accordance with and governed by the laws of the State of Illinois without giving
effect to any choice of law or conflicts of law provision or rule that would
cause the application of the laws of any other jurisdiction. Any legal action
or proceeding with respect to this Put Right Certificate or any document related
hereto shall be brought in the courts of the State of New York sitting in the
County of New York or of the United States of America for the State of New York
sitting in the County of New York or in the courts of the State of Illinois
sitting in the County of Cook or of the United States of America for the State
of Illinois sitting in the Northern District of Illinois, and, by execution and
delivery and/or acceptance of this Put Right Certificate, Baxter, Nexell and the
Holder of this Put Right Certificate each hereby accepts the non-exclusive
jurisdiction of the aforesaid courts.
In addition, Nexell, Baxter and the Holder hereby irrevocably and
unconditionally waive any objection which they may now or hereafter have to the
laying of venue of any of the aforesaid actions, suits or proceedings arising
out of or in connection with this Put Right Certificate or any document related
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<PAGE>
hereto brought in any of the aforesaid courts, and hereby further irrevocably
and unconditionally waive and agree not to plead or claim that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum.
Baxter, Nexell and the Holder hereby irrevocably waive all right to a trial
by jury in any suit, action or other proceeding instituted by or against it in
respect of its obligations hereunder or the transactions contemplated hereby.
Section 17. Amendment and Waiver. This Put Right Certificate may be
amended, and the observance of any term hereof may be waived, with and only with
the written consent of Baxter, Nexell and the Holder. Any amendment or waiver
consented to as provided above shall be binding upon Baxter, Nexell, the Holder
and each future Holder hereof. No such amendment or waiver will extend to or
affect any obligation, covenant, agreement or default not expressly amended or
waiver or impair any right consequent thereto. No course of dealing between
Baxter, Nexell and the Holder nor any delay in exercising any rights hereunder
shall operate as a waiver of any rights of the Holder.
Section 18. Exchange of Put Right Certificates. At any time and
from time to time prior to the expiration or termination of the Put Rights
evidenced by this Put Right Certificate, upon surrender by the Holder of this
Put Right Certificate at the principal offices of Baxter in Deerfield, Illinois
(with the assignment or, as the case may be, partial assignment form at the end
hereof duly executed, as applicable), Baxter will deliver in exchange therefor,
at Baxter's reasonable expense, a new Put Right Certificate or Put Right
Certificates of like tenor and date evidencing the Put Rights entitling such
Holder or such Holder's transferee to cause Baxter to purchase a like aggregate
number of shares of Put Stock as the Put Rights evidenced by the surrendered Put
Right Certificate or Put Right Certificates shall have entitled such Holder to
cause Baxter to purchase.
Section 19. Registered Certificate. Baxter shall keep at its principal
executive office a register for the initial registration and registration of
transfers of the Put Right Certificates. The name and address of each holder of
one or more Put Right Certificates, each transfer thereof and the name and
address of each transferee of one or more Put Right Certificates shall be
registered in such register. Prior to due presentment for registration of
transfer, the person in whose name any Put Right Certificate shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and Baxter shall not be affected by any notice or knowledge to the
contrary. Baxter shall give to the Holder promptly upon request therefor, a
complete and correct copy of the names and addresses of all registered holders
of Put Right Certificates.
Section 20. Notices. All notices and other communications provided for
hereunder shall be in writing and, if to the Holder of this Put Right
Certificate, delivered or mailed prepaid by registered or certified mail or
overnight air courier, or by facsimile communication, in each case addressed to
the address of such Holder appearing on Schedule I to the Securities Agreement
(in the case of the initial Holder) or such other address as such Holder or any
subsequent Holder of this Put Right Certificate may designate to Baxter or
Nexell in writing, and if to Baxter or Nexell,
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<PAGE>
delivered or mailed prepaid by registered or certified mail or prepaid overnight
air courier, or by facsimile communication, in each case addressed to the
recipient as follows:
If to Baxter: Baxter International Inc.
One Baxter Parkway
Deerfield, Illinois 60045
Attn: Treasurer
Facsimile: (847) 948-4509
With a copy to:
Attn: General Counsel
Facsimile: (847) 948-2450
If to Nexell: Nexell Therapeutics Inc.
9 Parker
Irvine, California 92618-1605
Attn: President
Facsimile: (949) 470-6645
With a copy to:
Bryan Cave LLP
120 Broadway, Suite 300
Santa Monica, California 90401-2305
Attn: Thomas S. Loo
Facsimile: (310) 576-2200
or to such other address as Baxter or Nexell shall designate in writing to each
other and to each Holder of Put Right Certificates; provided, however, that a
notice by overnight air courier shall only be effective if delivered to a street
address designated for such purpose, and a notice by facsimile communication
shall only be effective if confirmed by transmission of a copy thereof by
prepaid overnight air courier. Each notice, request, demand, approval or other
communication which is sent in accordance with this Section 20 shall be deemed
given and received for all purposes of this Put Right Certificate when actually
received in writing by such party.
Section 21. Successors and Assigns. This Put Right Certificate shall be
binding upon and inure to the benefit of and be enforceable by Baxter, Nexell
and the Holder and their respective successors and permitted assigns.
Notwithstanding the foregoing, neither Baxter nor Nexell may assign any of its
rights or obligations hereunder without the prior written consent of the Holder.
Section 22. Severability. Should any part of this Put Right Certificate for
any reason be declared invalid or unenforceable, such decision shall not affect
the validity or enforceability of any remaining portion, which remaining portion
shall remain in force and effect as if this Put Right Certificate had been
executed with the invalid or unenforceable portion thereof eliminated and it is
hereby declared the intention of the parties hereto that they would have
executed the remaining
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<PAGE>
portion of this Put Right Certificate without including therein any such part,
parts or portion which may, for any reason, be hereafter declared invalid or
unenforceable.
Section 23. Descriptive Headings. Titles to sections herein are for
information purposes only and are not to be construed as part of the agreements
between the parties hereto.
Section 24. Counterparts. This Put Right Certificate may be executed in
counterparts, all of which taken together shall constitute one and the same
agreement.
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<PAGE>
In Witness Whereof, Baxter and Nexell Therapeutics Inc. have executed this
Put Right Certificate as of the date first set forth above.
Baxter International Inc.
By
------------------------------------
Name:
-------------------------------
Title:
------------------------------
Nexell Therapeutics Inc.
By
-------------------------------------
Name:
-------------------------------
Title:
------------------------------
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<PAGE>
FORM OF ELECTION TO EXERCISE
To: Baxter International Inc.
[Address]
The undersigned, _________________________________, pursuant to the
provisions of the within Put Right Certificate, hereby elects to exercise
________ Put Rights and to cause Baxter International Inc. to purchase _____
shares of the Series B Preferred Stock of Nexell Therapeutics, Inc. pursuant to
the attached Put Right Certificate.
Payment of the Purchase Price in respect of the foregoing should be made as
follows:
Signature
-------------------------------
Address
-------------------------------
Dated:
Annex
(to Put Right Certificate)
<PAGE>
ASSIGNMENT
For Value Received ___________________ hereby sells, assigns and transfers
unto _______________________________________________________________ [name, and
address of transferee] the within Put Right Certificate and the all rights,
title and interest evidenced thereby and irrevocably constitutes and appoints
__________________, attorney, to transfer such Put Right Certificate.
Signature
-------------------------
Address
-------------------------
Dated:
Annex
(to Put Right Certificate)
<PAGE>
Partial Assignment
For Value Received ___________________ hereby sells, assigns and transfers
unto _______________________________________________________________ [name, and
address of transferee] ________ Put Rights evidenced by the within Put Right
Certificate and the all rights, title and interest evidenced thereby and
irrevocably constitutes and appoints __________________, attorney, to transfer
such Put Rights.
Signature
----------------------------
Address
----------------------------
Dated:
Annex
(to Put Right Certificate)
<PAGE>
EXHIBIT 7.9
SIDE LETTER AGREEMENT
This SIDE LETTER AGREEMENT ("Agreement") dated as of November 24, 1999 is
made between Nexell Therapeutics Inc., a Delaware corporation (the "Company"),
Baxter International Inc., a Delaware corporation ("Baxter"), and, for purposes
of Paragraph 4 hereof only, the other parties signatory hereto.
WHEREAS, in connection with that certain Securities Agreement dated as of
even date herewith between the Company and the purchasers identified in Schedule
1 thereto and in consideration of the repayment by the Company of those certain
convertible subordinated debentures, currently held by Baxter, Baxter is
granting a Put Right as a component of each share of Series B Preferred Stock
purchased at the Private Placement Closing (as described in the Put Agreement
between the Company and Baxter dated of even date herewith (the "Put
Agreement")); and
WHEREAS, in connection with the foregoing, the Company and Baxter are
entering into the Put Agreement, which sets forth certain procedures with
respect to the Private Placement and provides for certain representations and
warranties by each of the Company and Baxter; and
WHEREAS, terms not defined herein shall have the meaning ascribed to them
in the Company's Private Placement Memorandum dated July 1999.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties agree as follows:
1. Conversion Price. The Conversion Price for the Series B Preferred
purchased by Baxter (the "Put Series B Preferred") shall be adjusted on November
24, 2004 (or earlier if 100% of the Series B Preferred are put to Baxter), but
only in the event that an amount in excess of $15,000,000 is purchased by Baxter
(computed on the basis of the liquidation preference for such stock), as
follows: (i) for the Put Series B Preferred in an amount up to $53,000,000
(computed on the basis of the liquidation preference for such stock) (the
"Threshold"), the Conversion Price shall be adjusted to equal the closing price
of the Common Stock on the respective date or dates such Series B Preferred were
purchased by Baxter pursuant to such Put (including purchases below the
$15,000,000 amount) less a discount of 5% (subject to a floor price equal to the
closing price of the Common Stock on November 24, 1999 unless shareholder
approval is obtained if required by the rules of the NASDAQ Stock Market); (ii)
for the Put Series B Preferred in excess of the Threshold, the Conversion Price
shall be adjusted to equal the closing price of the Common Stock on November 24,
1999. The foregoing calculations shall yield a single adjusted Conversion Price
based on a blended, weighted average of the adjustments provided for above.
2. Interest. The dollar amount of the Put Series B Preferred shall be
deemed to accrue interest from the respective date(s) the Series B Preferred is
[are] purchased by Baxter to the date the Conversion Price is determined at a
rate equal to the applicable three year U.S. Treasury Note rate at the date of
each such purchase, plus 100 basis points. Such deemed
<PAGE>
accrued interest shall be included in the calculation of the dollar amount of
the Put Series B Preferred then outstanding and thus in the determination of the
number of shares of Common Stock into which the Put Series B Preferred shall
convert (i.e., the accrued interest shall be payable in kind in additional
shares of Series B Preferred, computed on the basis of the then applicable
liquidation preference for the Series B Preferred, and such shares shall have
the adjusted Conversion Price determined in accordance with Paragraph 1 hereof,
if applicable).
3. Shareholder Approval. The Company and Baxter acknowledge and agree
that any adjustment to the Conversion Price will only be made following approval
by the Company's shareholders to the extent required by the rules of The NASDAQ
Stock Market or otherwise. The Company agrees to use reasonable best efforts to
accomplish this, if necessary.
4. Voting Agreement. If the Threshold is met, Baxter's obligation under
its December 17, 1997 Voting Agreement with the Company and others to vote its
shares of Common Stock in support of nominees for directors of the Company
proposed by the Company's Board of Directors shall terminate, as well as the
irrevocable proxy granted by Baxter to the Chief Executive Officer of the
Company in connection therewith.
5. Alternative Adjustments. Notwithstanding any other provision in this
Agreement to the contrary, in the event the Conversion Price for the Put Series
B Preferred cannot be adjusted as indicated in Paragraph 1 hereof (because, for
example, at the end of the Put Period, at least one holder of the Series B
Preferred has not exercised its Put Right and thus remains a holder of Series B
Preferred, and if it is impermissible under Delaware law or otherwise for the
Conversion Price applicable to such holder to be different than the Conversion
Price applicable to Baxter as the holder of the Put Series B Preferred), then in
such event the Company agrees to take such action as is appropriate to exchange
the Put Series B Preferred (including any shares issued to Baxter under
Paragraph 2 hereof) for an equal number of shares of a new series of preferred
stock of the Company, having identical terms, conditions, preferences and rights
of the Series B Preferred, except that the Conversion Price will reflect the
adjustments provided in Paragraph 1 hereof.
6. Representations and Warranties.
(a) The Company represents and warrants to Baxter that the Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has taken all corporate action necessary
for it to execute, deliver and perform this Agreement (subject to Paragraphs 3
and 5 hereof), and the Company has full power and authority to enter into this
Agreement and perform its obligations hereunder. This Agreement is the valid and
legally binding agreement of the Company enforceable in accordance with its
terms.
(b) Baxter represents and warrants to the Company that Baxter is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. Baxter has taken all corporate action necessary for it
to execute, deliver and perform this Agreement, and Baxter has full power and
authority to enter into this Agreement and perform its obligations hereunder.
This Agreement is the valid and legally binding agreement of Baxter enforceable
in accordance with its terms.
2
<PAGE>
7. Binding Agreement. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective permitted successors and
assigns.
8. Assignment. Neither party hereto may assign or transfer this Agreement
without the prior written consent of the other party hereto; provided, however,
that either party hereto may assign this Agreement to any person or entity with
or into which such party may merge or consolidate or to whom all or
substantially all of its assets or businesses may be sold and that Baxter may
assign this Agreement to any wholly-owned subsidiary of Baxter.
9. Entire Agreement. This Agreement, together with the Put Agreement and
the Put Right Certificates, sets forth the entire understanding of the parties
hereto with respect to the subject matter hereof and supersedes all prior
agreements, written and oral, among the parties hereto as to such subject
matter.
10. Waiver. The waiver by either party hereto of any breach of any
provision of this Agreement shall not constitute or operate as a waiver of any
other breach of such provision or of any other provision hereof, nor shall any
failure to enforce any provision hereof operate as a waiver of such provision or
of any other provision hereof.
11. Expenses. Except as expressly provided in this Agreement and subject
to any rights based on a breach of this Agreement, each party hereto shall bear
its own costs and expenses incident hereto.
12. Amendments. This Agreement may not be amended, nor may any provision
hereof be modified or waived, except by an instrument in writing duly signed by
both parties hereto.
13. Notices. All notices and other communications required or permitted to
be given hereunder shall be deemed sufficiently given if sent by certified mail,
postage prepaid, return receipt requested, by facsimile transmission (with
receipt confirmed) or by air courier service (with receipt confirmed), addressed
as follows:
If to the Company:
Nexell Therapeutics, Inc.
9 Parker
Irvine, CA 92618-1605
Attention: President
Facsimile: (949) 470-6645
with a copy to:
Bryan Cave LLP
120 Broadway, Suite 300
Santa Monica, CA 90401-2305
Attention: Thomas S. Loo, Esq.
Facsimile: (310) 576-2200
3
<PAGE>
If to Baxter:
Baxter International Inc.
One Baxter Parkway
1627 Lake Cook Road
Deerfield, IL 60015-4633
Attention: Treasurer
Facsimile: (847) 848-4509
with a copy to:
Baxter International Inc.
One Baxter Parkway
1627 Lake Cook Road
Deerfield, IL 60015
Attention: General Counsel
Facsimile: (847) 948-2450
or at such other address as it may have furnished in writing to the other party
hereto.
14. Severability. If any provision of this Agreement shall be held
invalid, illegal or unenforceable, the validity, legality or enforceability
of the other provisions hereof shall not be affected thereby, and there shall be
substituted for the provision at issue a valid and enforceable provision as
similar as possible to the provision at issue.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois, without reference to the
principles of conflict of laws thereof.
16. Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect the meaning, interpretation, enforceability
or validity of this Agreement.
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same document.
* * *
4
<PAGE>
In Witness Whereof, the Company and Baxter have each caused this Agreement
to be executed by their duly authorized officers as of the date first written
above.
Nexell Therapeutics Inc.
By:
Name:
Title:
Baxter International Inc.
By:
Name:
Title:
The provisions of Paragraph 4 hereof are accepted and agreed to:
Lindsay A. Rosenwald, M.D. Donald G. Drapkin
Paramount Capital Asset Management Inc.
Richard L. Dunning
By:
Lindsay A. Rosenwald, M.D.
Laurence D. Fink
Eric A. Rose, M.D.
5
