SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): January 28, 1998
NAPRO BIOTHERAPEUTICS, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-243201 84-1187753
(State or Other Jurisdiction of (Commission File Number) (I.R.S. Employer
Incorporation) Identification Number)
6304 Spine Road, Unit A
Boulder, Colorado 80301
(Address of Principal Executive Offices)(Zip code)
Registrant's telephone number, including area code: (303) 530-3891
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Item 5. Other Events
As previously reported, on January 6, 1998, the Company entered into
Agreements in Principal relating to modification of certain terms of its 5%
Senior Convertible Notes due June 4, 2000 (the "Notes") and Series C Senior
Convertible Preferred Stock (the "Preferred Stock"). The Company entered into
definitive agreements relating to such modifications on January 28, 1998.
The amendment with respect to the Notes (the "Note Amendment") limits,
under certain circumstances prior to December 31, 1998: (i) the amount of Notes
that can be converted into Common Stock and (ii) the ability of a holder of Note
to force redemption of the inconvertible portions of the Note for cash.
Similarly, the amendment with respect to the Preferred Stock (the "Preferred
Stock Amendment," and together with the Note Amendment, the "Amendments")
limits, under certain circumstances prior to December 31, 1998: (i) the number
of shares of Common Stock that may be issued upon conversion of the Preferred
Stock and (ii) the ability of a holder of the Preferred Stock to force
redemption of the inconvertible portions of the Preferred Stock for cash.
Pursuant to the Note Amendment and the Preferred Stock Amendment, the
Company has agreed to propose to its stockholders, at a meeting to be held no
later than June 1, 1998: (i) an amendment to the Company's Certificate of
Incorporation providing for an increase in the authorized Common Stock of the
Company and (ii) approval of issuance of the Common Stock upon the conversion of
the Notes and Preferred Stock in certain circumstances. The Company has also
agreed to take certain actions in connection with the registration under the
Securities Act of 1933, as amended, of shares issuable upon conversion of the
Notes and the Preferred Stock.
Prior to and in connection with Note Amendment, the Company redeemed
$397,000 in principal amount of the Notes. Premium and interest in the amount of
$53,000 were paid in connection with such redemption.
The Note Amendment and the Preferred Stock Amendment have been filed as
exhibits to this Report and are incorporated herein by this reference. The
description of provisions of the Note Amendment and the Preferred Stock
Amendment in this Report does not purport to be complete and is qualified in its
entirety by reference to such exhibits.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits.
Exhibit No. Exhibit Description
4.1 Amendment Agreement, dated as of January 28, 1998,
by and among the Registrant and the noteholders
named therein.
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4.2 Amendment Agreement, dated as of January 28, 1998,
by and between the Registrant and Advantage Fund II,
Ltd.
4.3 Amendment Number 2 to the Agreement in
Principle, dated as of January 27, 1998, by and
between the Registrant and Omicron Partners,
L.P.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NAPRO BIOTHERAPEUTICS, INC.
By: \s\ Gordon H. Link, Jr.
Gordon H. Link, Jr.
Chief Financial Officer
Date: January 30, 1998
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Exhibit 4.1
January 28, 1998
NaPro BioTherapeutics, Inc.
6304 Spine Road
Unit A
Boulder, Colorado 80301
Attn: Vice President and Chief Financial Officer
Gentlemen:
Reference is made to (i) the Note Purchase Agreements (the "Purchase
Agreements") dated as of May 30, 1997 among NaPro BioTherapeutics, Inc., a
Delaware corporation (the "Company"), and the various Buyers parties thereto, as
amended to date, (ii) the Engagement Letter dated May 12, 1997 (the "Engagement
Letter") between the Company and Diaz & Altschul Capital, LLC ("Diaz &
Altschul"); (iii) each of the Senior Convertible Notes of the Company, as
amended to date (each, a "Note") and (iv) warrants to purchase an aggregate of
323,700 shares of common stock of the Company, issued to the Buyers and certain
of which are held by Diaz & Altschul Group, LLC (the "Warrants"). Capitalized
terms used herein and not defined shall have the meanings assigned to them in
the Purchase Agreements and the Notes.
The various Holders and the Company agree as follows:
(a) (1) The Company agrees to hold an annual meeting of stockholders
(the "Annual Meeting") no later than June 1, 1998. Prior to the Annual Meeting,
the Board of Directors of the Company shall recommend to the stockholders that
they (i) approve an amendment to the Company's Certificate of Incorporation
which shall increase the authorized Common Stock to 30,000,000 shares and (ii)
effect the Stockholder Approval. The Board of Directors of the Company will
solicit proxies to vote the outstanding shares of Common Stock in favor of the
actions specified in clauses (i) and (ii) of the immediately preceding sentence
and the Company shall otherwise use its best efforts to obtain approval of such
actions by the holders of the outstanding Common Stock. If the stockholders take
the action specified in clause (i) and fail to take the actions specified in
clause (ii) of the first sentence of this paragraph (a), the Company shall use
its best efforts to obtain a waiver by Nasdaq of the Stockholder Approval. The
Company may cease taking further steps to fulfill the requirements of this
paragraph (a) if at any time prior to performance in full of the Company's
obligations under this paragraph (a)(1) no Notes are outstanding or the Company
shall have redeemed all outstanding Notes pursuant to Section 1.2 of the Notes
by payment in full of the Optional Redemption Price thereof after giving an
Optional Redemption Notice therefor in accordance with Section 1.2 of the Notes.
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(2) If the stockholders fail to take the actions specified in
clauses (i) and (ii) of the first sentence of paragraph (a)(1), so long as the
Company is in compliance in all material respects with its obligations to the
Holders, then on June 1, 1998, this Agreement shall terminate and the terms of
the Notes and Warrants shall be those in effect on the date hereof without
giving effect to the amendments contained herein, except that Sections (n) and
(o) hereof shall remain in effect.
(b) Section 2.2 of the Notes is amended and restated in its entirety to
read as follows:
2.2 Authorized Shares. The Company covenants that,
during the period the conversion rights exist, (i) until the
date on which the Stockholder Approval is effected, the
Company will reserve from its authorized and unissued Common
Stock an aggregate of 2,222,222 shares for issuances pursuant
hereto from the Issuance Date through the date on which the
Stockholder Approval is effected, and (ii) from the date on
which the Stockholder Approval is effected through December
31, 1998, the Company will reserve from its authorized and
unissued Common Stock an aggregate of 3,820,000 shares for
issuances pursuant hereto from the Issuance Date through
December 31, 1998 (such amounts referred to in clauses (i) and
(ii) above to be subject to equitable adjustment from time to
time on terms reasonably acceptable to the Holder for stock
splits, stock dividends, combinations, capital reorganizations
and similar events relating to the Common Stock occurring on
or after the Issuance Date) to provide for the issuance of
Common Stock upon the conversion of this Note and the Other
Notes, subject to reduction from time to time by the number of
shares of Common Stock issued on conversion of this Note and
the Other Notes. The Company shall, from time to time,
authorize and reserve additional shares of Common Stock to be
issuable pursuant to the terms of this Note as shall be
necessary to ensure any payment of interest on this Note in
accordance with Section 1.1. and on the Other Notes in
accordance with the terms thereof. In addition, the Company
shall, after December 31, 1998 and so long as any conversion
rights exist hereunder, authorize and reserve additional
shares of Common Stock to be issuable pursuant to the terms of
this Note as shall be necessary to ensure that an adequate
number of shares of Common Stock are at all times authorized
and reserved for issuance upon full conversion of this Note
and the Other Notes. The Company represents and warrants that
upon issuance, such shares of Common Stock will be duly and
validly issued, fully paid and non-assessable. The Company
agrees that its issuance of this Note shall constitute full
authority to its officers and agents who are charged with the
duty of executing stock certificates to execute and issue the
necessary certificates for shares of Common Stock upon the
conversion of and payment of interest on this Note.
(c) So long as the Company is in compliance in all material respects
with its obligations to the Holders, including, without limitation, the
obligations of the Company under the Transaction Documents and this Agreement,
during the period beginning on
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December 19, 1997 and ending December 31, 1998, the Holders hereby waive their
rights to require to the Company to redeem the Notes due to a Maximum Share
Amount Inconvertibility, including any rights to receive notice.
(d) A new Section 2.5 and a new Section 2.6 are added at the end of Article
II to read as follows:
2.5 Other Inconvertibility Events. If at any time following
the Stockholder Approval, the Company or the Holder becomes
aware of any facts that would cause any portion of this Note
to be inconvertible, other than a Maximum Share Amount
Inconvertibility or a Registration Restriction
Inconvertibility, such person shall promptly give written
notice of such facts to the other person. Promptly upon
receipt by the Company of such notice (if the Company is the
receiving person) or in such notice (if the Company sends such
notice), if the Company agrees that such inconvertibility
exists, the Company shall make an offer to redeem such
inconvertible portion of this Note within 10 Business Days at
the Redemption Price. Such Redemption Price shall be payable
by the Company in four equal monthly installments and the
principal amount of this Note shall be reduced accordingly as
such payments are made. Such inconvertible portion to be
redeemed on or after January 1, 1999 shall be the largest
amount of this Note which could not be converted at any time
on or after the Stockholder Approval.
2.6 Limitation on Conversion Under Certain Circumstances.
(a) Notwithstanding any other provision herein, (A)
the Holder shall have no right to convert any portion of the
principal amount of this Note (and accrued and unpaid interest
thereon and on any such interest) if such conversion would
result in (i) the aggregate number of shares of Common Stock
issued hereunder during the period beginning on the Issuance
Date and ending on December 31, 1998 (whether through
conversion (including pursuant to Section (h) of the letter
agreement dated January 28, 1997 among the Company, the Holder
and the holder of the Other Notes (the "Amendment Agreement"))
or in payment of interest or otherwise) exceeding the
Aggregate Allotment (as defined in the Amendment Agreement) of
this Note, and (B) subject to Section 1.2(b), during the
period beginning on January 1, 1998 and ending on December 31,
1998, the Holder shall not be entitled to convert any portion
of this Note at a Conversion Price that is less than $4.00 if
such conversion would result in the aggregate number of shares
of Common Stock issued hereunder (whether through conversion
or in payment of interest or otherwise but excluding any
shares issued pursuant to Section (h) of the Amendment
Agreement) at a Conversion Price (or Computed Price, in the
case of Payment Shares) that is less than $4.00 during the
calendar month of the proposed conversion for which the
determination under this
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clause (B) is being made exceeding the Monthly Allotment (as
defined in the Amendment Agreement).
(b) Notwithstanding any other provision herein, until
the Stockholder Approval is obtained, the Holder shall have no
right to convert any portion of the principal amount of this
Note (and accrued and unpaid interest thereon and on any such
interest) if such conversion would result in the aggregate
number of shares of Common Stock issued hereunder (whether
through conversion (including pursuant to Section (h) the
Amendment Agreement) or in payment of interest or otherwise)
exceeding the Initial Allotment (as defined in the Amendment
Agreement).
(c) The provisions contained in this Section 2.6
shall be of no further force and effect if (i) the Company is
acquired by another person by means of any merger,
consolidation, sale or all or substantially all assets of the
Company, share exchange or other business combination (each, a
"Transaction"), (ii) the Company enters into any Transaction
where the shareholders of the Company immediately prior to
such Transaction do not collectively own at least 51% of the
outstanding voting securities of the surviving corporation of
such Transaction immediately following such Transaction, (iii)
the Company enters into any agreement for any such
Transaction, (iv) a Tender Offer is consummated for at least
51% of the outstanding shares of Common Stock or (v) the
Company fails to comply in any material respect with its
obligations to the Holder, including, without limitation, the
Amendment Agreement or the Note Purchase Agreement, the
Warrants or this Note as amended by the Amendment Agreement.
(e) "Aggregate Allotment" shall mean the following with respect to each
Note:
Note Aggregate Allotment
----
1 1,422,562
2 768,537
3 768,142
4 659,119
5 92,100
6 109,540
(f) "Initial Allotment" shall mean the following with respect to each Note:
Note Initial Allotment
1 835,259
2 418,413
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3 418,198
4 431,799
5 53,893
6 64,660
(g) "Monthly Allotment" shall mean the following with respect to each Note:
Note Monthly Allotment
----
1 110,272
2 65,740
3 65,706
4 42,682
5 7,174
6 8,427
(h) Notwithstanding any inconsistent provisions of Section 2.1 of the
Notes, Nelson Partners and Olympus Securities Ltd. (but not any transferee of
their interests in the Notes), taken together, and Delta Opportunity Fund, Ltd.
and OTATO L.P. (but not any transferee of their interests in the Notes), taken
together, shall each have the right at any time to convert an aggregate amount
of principal of and interest on the Notes equal to $236,250 at a Conversion
Price of $1.575, which right shall not affect the conversion rights set forth in
Section 2.6(a)(ii) of the Notes. The principal amount of such Notes shall, in
such case, be reduced in the manner set forth in Section 2.3 of the Notes.
(i) A new Section 3.9 is added at the end of Article III of each Note to
read as follows:
3.9 Limitation on Liens. Until (x) June 1, 1998 (if the
Stockholder Approval is not obtained on or prior to such date)
or (y) December 31, 1998 (if the Stockholder Approval is
obtained on or prior to June 1, 1998), while any Notes are
outstanding, the Company will not, and will not permit any of
its subsidiaries to, without prior written consent of the
Majority Holders, create, incur, assume or suffer to exist any
Liens of any kind against or upon any of its property or
assets, or any proceeds therefrom, unless (i) in the case of
Liens securing indebtedness that is expressly subordinate or
junior in right of payment to the Notes, the Notes are secured
by a Lien on such property, assets or proceeds that is senior
in priority to such Liens and (ii) in all other cases, the
Notes are equally and ratably secured, except for (A) Liens
existing as of the date of the Amendment Agreement (the
"Amendment Date") and any extensions, renewals or replacements
thereof, (B) Liens securing the Notes, (C) Liens securing
intercompany indebtedness of the Company or a subsidiary of
the Company and (D) Permitted Liens.
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(j) The first sentence of Section 1.2(a) of the Notes is amended by
deleting "50%" and replacing it with "100%".
(k) Section 1.2(b) of the Notes is amended and restated in its entirety to
read:
(b) The Company shall not be entitled to give an
Optional Redemption Notice or to redeem any portion of this
Note with respect to which the Holder has given a Conversion
Notice. Notwithstanding the giving of an Optional Redemption
Notice, the Holder shall be entitled to convert in accordance
with the terms of this Note such portion of this Note which
otherwise is to be redeemed in accordance with such Optional
Redemption Notice and would convert into shares of Common
Stock sufficient to cover open and short positions in the
Common Stock held by the Holder on the date of the Optional
Redemption Notice, by giving a Conversion Notice at any time
prior to the later of (1) the date which is one Business Day
prior to the applicable Optional Redemption Date and (2) the
date on which the Company pays the Optional Redemption Price
of such portion of this Note to the Holder; provided, however,
that if the Company defaults in payment of the Optional
Redemption Price, the Holder shall thereafter be entitled to
convert this Note.
(l) The definition of "Optional Redemption Date" and "Optional
Redemption Price" in Section 7.1 of the Note are amended and restated as
follows:
"Optional Redemption Date" means, as applicable, a 1998 Redemption Date or
a Subsequent Redemption Date.
"Optional Redemption Price" means, as applicable, the 1998
Redemption Price or the Subsequent Redemption Price. The 1998
Redemption Price shall be payable on any 1998 Redemption Date
and the Subsequent Redemption Price shall be payable on any
Subsequent Redemption Date.
(m) The following definitions are added to Section 7.1 of the Note in the
appropriate alphabetical order:
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind
in respect of such asset, whether or not filed, recorded or
otherwise perfected under applicable law (including any
conditional sale or other title retention agreement, any lease
in the nature thereof, any option or other agreement to sell
or give a security interest in and any filing of or agreement
to give any financing statement under the Uniform Commercial
Code (or equivalent statutes) of any jurisdiction).
"1998 Redemption Date" means any Business Day during the
period commencing on the Issuance Date and ending on December
31, 1998.
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"1998 Redemption Price" means an amount in cash equal to the
sum of (1) the product obtained by multiplying (A) the sum of
(i) the outstanding principal amount of the Note specified in
an Optional Redemption Notice as being required to be redeemed
by the Company plus (ii) accrued and unpaid interest on such
principal amount to the Optional Redemption Date times (B)
130% plus (2) accrued and unpaid Default Interest, if any, on
the amount referred to in the immediately preceding clause
(1)(A)(ii) at the rate provided in this Note to the Optional
Redemption Date. The 1998 Redemption Price shall be adjusted
to reflect the reduced outstanding principal amount of this
Note and related accrued interest on the Optional Redemption
Date resulting from any permitted conversions of this Note
after the Optional Redemption Notice is given pursuant to
Section 1.2(b).
"Permitted Liens" means the following types of Liens:
(1) Liens for taxes, assessments or governmental
charges or claims either (a) not delinquent or (b) contested
in good faith by appropriate proceedings and as to which the
Company or its subsidiaries shall have set aside on its books
such reserves as may be required pursuant to Generally
Accepted Accounting Principles;
(2) statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, suppliers, materialmen,
repairmen and other Liens imposed by law incurred in the
ordinary course of business for sums not yet delinquent or
being contested in good faith, if such reserve or other
appropriate provision, if any, as shall be required by
Generally Accepted Accounting Principles shall have been made
in respect thereof;
(3) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security,
including any Lien securing letters of credit issued in the
ordinary course of business consistent with past practice in
connection therewith, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases,
government contracts, performance and return-of-money bonds
and other similar obligations (exclusive of obligations for
the payment of borrowed money);
(4) judgment Liens not giving rise to an Event of Default:
(5) easements, rights-of-way, zoning restrictions and
other similar charges or encumbrances in respect of real
property not interfering in any material respect with the
ordinary course of the business of the Company;
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(6) any interest or title of a lessor under any capitalized lease
obligation;
(7) purchase money Liens to finance property or assets of the Company or
any subsidiary of the Company acquired in the ordinary course of business;
(8) Liens upon specific items of inventory or other
goods and proceeds of any person securing such person's
obligations in respect of bankers' acceptances issued or
created for the account of such person to facilitate the
purchase, shipment, or storage of such inventory or other
goods;
(9) Liens securing reimbursement obligations with
respect to commercial letters of credit which encumber
documents and other property relating to such letters of
credit and products and proceeds thereof;
(10) Liens encumbering deposits made to secure
obligations arising from statutory, regulatory, contractual,
or warranty requirements of the Company or any of its
subsidiaries, including rights of offset and set-off;
(11) leases or subleases granted to others that do not materially interfere
with the ordinary course of business of the Company and its subsidiaries; and
(12) Liens arising from filing Uniform Commercial Code financing statements
regarding leases.
"Subsequent Redemption Date" means any Business Day beginning
on January 1, 1999 and ending on the first date on which no
principal amount of this Note is outstanding.
"Subsequent Redemption Price" means an amount in cash equal to
the sum of (1) the product obtained by multiplying (A) the sum
of (i) the outstanding principal amount of the Note specified
in an Optional Redemption Notice as being required to be
redeemed by the Company plus (ii) accrued and unpaid interest
on such principal amount to the Optional Redemption Date times
(B) 110% plus (2) accrued and unpaid Default Interest, if any,
on the amount referred to in the immediately preceding clause
(1)(A)(ii) at the rate provided in this Note to the Optional
Redemption Date. The Subsequent Redemption Price shall be
adjusted to reflect the reduced outstanding principal amount
of this Note and related accrued interest on the Optional
Redemption Date resulting from any permitted conversions of
this Note after the Optional Redemption Notice is given
pursuant to Section 1.2(b).
(n) The proviso at the end of the definition of Conversion Price in Section
7.1 of the Note is amended and restated as follows:
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provided, however, that (i) on any date on or after March 1,
1998 but prior to June 1, 1998, the Conversion Price shall not
be greater than 110% of the arithmetic average of the Market
Price of the Common Stock for the period of thirty (30)
consecutive Trading Days ending one Trading Day prior to March
1, 1998 (the "March Cap") and (ii) on any date on or after
June 1, 1998, the Conversion Price shall not be greater than
the lesser of (A) 110% of the arithmetic average of the Market
Price of the Common Stock for the period of thirty (30)
consecutive Trading Days ending one Trading Day prior to June
1, 1998 and (B) the March Cap.
(o) The definition of "Purchase Price" in the Warrants is amended by
deleting "$10.00" and replacing it with "$2.50."
(p) (1) Within five Business Days of the date hereof, the Company shall
(i) file a Current Report on Form 8-K describing the terms of this Amendment
Agreement (the "8-K") and (ii) make a good faith determination within five days
after execution of this Agreement of whether, pursuant to Section 8 of the Note
Purchase Agreements, the Company is required to file an additional Registration
Statement or to amend the existing Registration Statement and notify the Holders
in writing of such determination. Notwithstanding Section 8 of the Note Purchase
Agreements, if the Company so determines that such a filing is required, the
Company shall file such Registration Statement within 15 days after the date
hereof or such amendment within five Business Days after the date hereof.
(2) This Agreement constitutes a notice pursuant to Section
8(b)(5) of the Note Purchase Agreement and accordingly the Holders agree that
they will not sell any securities pursuant to the Prospectus until the Company
gives the Holders notice that they may thereafter do so. The Company hereby
confirms that it will use its best efforts to make the Prospectus available
within five Business Days after the date hereof.
(3) During the period beginning on the date hereof and ending
on the earlier to occur of (i) effectiveness of an amendment to the existing
Registration Statement or (ii) a good faith determination by the Company that no
such amendment is required and the filing of the 8-K, or (iii) the date that is
30 days after the date of this Agreement, the Holders waive their rights under
Sections 4.1 and 4.2 of the Notes to require the Company to repurchase any Notes
by reason of clause (e) of the definition of Repurchase Event or the occurrence
of a Registration Repurchase Event.
(4) Notwithstanding any inconsistent provision in Section 8 of
the Note Purchase Agreements, if the Company is required, pursuant to Section 8
of the Note Purchase Agreements, to file an additional registration statement to
register shares of Common Stock issuable upon conversion of the Notes following
the Stockholder Approval, it will do so within 15 days after obtaining the
Stockholder Approval. Notwithstanding any inconsistent provision in Section 8 of
the Note Purchase Agreements, the Company will use its best efforts to have such
Registration Statement declared effective as soon as possible but in no event
later than 75 days after obtaining the Stockholder Approval. Such Registration
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Statement and the related prospectus shall otherwise be deemed to be
included in the terms "Registration Statement" and "Prospectus."
(q) Each Holder represents and warrants that it has all requisite power
and authority, corporate or otherwise, to execute, deliver and perform its
obligations under this Agreement and the other agreements executed by such
Holder in connection herewith and to consummate the transactions contemplated
hereby and thereby; and this Agreement has been duly and validly authorized,
duly executed and delivered by such Holder and, assuming due execution and
delivery by the Company, is a valid and binding agreement of such Holder
enforceable in accordance with its terms, except as the enforceability hereof
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in effect relating to or
affecting creditors' rights generally and general principles of equity,
regardless of whether enforcement is considered in a proceeding in equity or at
law.
(r) The Company represents and warrants to the Holders that:
(1) The Common Stock is listed for trading on Nasdaq and (1)
the Company and the Common Stock meet the criteria for continued listing and
trading on Nasdaq; (2) the Company has not been notified since January 1, 1995
by the NASD of any failure or potential failure to meet the criteria for
continued listing and trading on Nasdaq and (3) no suspension of trading in the
Common Stock is in effect. The Company knows of no reason why the Shares will
not be eligible for listing on Nasdaq.
(2) This Agreement has been duly authorized, executed and
delivered by the Company and, assuming due execution and delivery by the
Holders, this Agreement is a valid and binding obligation of the Company
enforceable in accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in effect relating to or
affecting creditors' rights generally and general principles of equity,
regardless of whether enforcement is considered in a proceeding in equity or at
law.
(3) The execution and delivery of this Agreement and the
consummation by the Company of the transactions contemplated hereby do not and
will not, with or without the giving of notice or the lapse of time, or both,
(i) result in any violation of any term of the certificate of incorporation or
by-laws of the Company or any of its Subsidiaries, (ii) conflict with or result
in a breach by the Company or any of its Subsidiaries of any of the terms or
provisions of, or constitute a default under, or result in the modification of,
or result in the creation or imposition of any lien, security interest, charge
or encumbrance upon any of the properties or assets of the Company or any of its
Subsidiaries pursuant to, any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or any of their
respective properties or assets are bound or affected or (iii) violate or
contravene any applicable law, rule or regulation or any applicable decree,
judgment or order of any court,
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United States federal or state regulatory body, administrative agency or other
governmental body having jurisdiction over the Company or any of its
Subsidiaries or any of their respective properties or assets or (iv) have any
material adverse effect on any permit, certification, registration, approval,
consent, license or franchise necessary for the Company or any of its
Subsidiaries to own or lease and operate any of their respective properties and
to conduct any of their respective businesses or the ability of the Company or
any of the Subsidiaries to make use thereof.
(4) No authorization, approval or consent of, or filing with,
any court, governmental body, regulatory agency, self-regulatory organization,
or stock exchange or market or the stockholders of the Company is required to be
obtained or made by the Company or any of its Subsidiaries in connection with
the execution, delivery and performance of this Agreement, other than (1)
listing of the additional Shares on Nasdaq, (2) registration of the resale of
the Shares under the 1933 Act as contemplated by Section 8, (3) as may be
required under applicable state securities or "blue sky" laws.
(5) Once the Stockholder Approval has been obtained and a
certificate of amendment to the Company's certificate of incorporation has been
filed to increase the number of authorized shares of Common Stock, the
additional shares of Common Stock issuable upon conversion of the Notes will be
duly authorized and, upon issuance upon conversion of the Notes, will be validly
issued and fully paid and non-assessable.
(s) Prior to transferring any Notes, and in addition to the provisions
in Section 8.7 of the Notes, a Holder shall provide the transferee with a copy
of this Agreement and such transferee shall agree in writing to be bound by the
terms hereof. The Company agrees to be bound by the terms of this Agreement for
the benefit of each such transferee.
(t) The parties hereto agree that the condition set forth on the first
signature page hereto has been satisfied.
* * * * *
This Amendment Agreement is conditioned upon the amendment of the terms
of the Company's Series C Convertible Preferred Stock, substantially on the
terms set forth on Exhibit A to the Agreement in Principle, dated as of January
6, 1998 by and between the Company and Advantage Fund II, Ltd.
DELTA OPPORTUNITY FUND, LTD.
By: \s\
NELSON PARTNERS
By: \s\
#370535
<PAGE>
OLYMPUS SECURITIES, LTD.
By: \s\
OMICRON PARTNERS, L.P.
By: \s\
OTATO L.P.
By: \s\
DIAZ & ALTSCHUL GROUP, LLC
By: \s\
Acknowledged and agreed:
NAPRO BIOTHERAPEUTICS, INC.
By: \s\ Gordon H. Link, Jr.
Date: 1/28/98
#370535
<PAGE>
Exhibit 4.2
January 28, 1998
NaPro BioTherapeutics, Inc.
Unit A
6304 Spine Road
Boulder, Colorado 80301
Attn: Vice President and Chief Financial Officer
Gentlemen:
Reference is made to (i) the Subscription Agreement (the "Subscription
Agreement") dated as of December 8, 1997 by and between NaPro BioTherapeutics,
Inc., a Delaware corporation (the "Company" or the "Corporation"), and Advantage
Fund II, Ltd. (the "Holder"); (ii) the Certificate of Designations of Series C
Senior Convertible Preferred Stock (the "Certificate"); and (iii) warrants to
purchase 175,000 shares of common stock of the Company, issued to the Holder
(the "Warrants"). Capitalized terms used herein and not defined shall have the
meanings assigned to them in the Subscription Agreement and the Certificate.
The Holder and the Company agree as follows:
(a) (1) The Company agrees to hold an annual meeting of stockholders
(the "Annual Meeting") no later than June 1, 1998. Prior to the Annual Meeting,
the Board of Directors of the Company shall recommend to the stockholders that
they (i) approve an amendment to the Company's Certificate of Incorporation
which shall increase the authorized Common Stock to 30,000,000 shares and (ii)
effect the Stockholder Approval. The Board of Directors of the Company will
solicit proxies to vote the outstanding shares of Common Stock in favor of the
actions specified in clauses (i) and (ii) of the immediately preceding sentence
and the Company shall otherwise use its best efforts to obtain approval of such
actions by the holders of the outstanding Common Stock. If the stockholders take
the action specified in clause (i) and fail to take the actions specified in
clause (ii) of the first sentence of this paragraph (a), the Company shall use
its best efforts to obtain a waiver by Nasdaq of the Stockholder Approval. The
Company may cease taking further steps to fulfill the requirements of this
paragraph (a) if at any time prior to performance in full of the Company's
obligations under this paragraph (a)(1) no shares of Series C Preferred Stock
are outstanding or the Company shall have redeemed all outstanding shares of
Series C Preferred Stock pursuant to Section 9(a) of the Certificate by payment
in full of the Redemption Price
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<PAGE>
thereof after giving a Redemption Notice therefor in accordance with Section
9(a) of the Certificate.
(2) If the stockholders fail to take the actions specified in
clauses (i) and (ii) of the first sentence of paragraph (a)(1), so long as the
Company is in compliance in all material respects with its obligations to the
Holder, then on June 1, 1998, this Agreement shall terminate and the terms of
the Series C Preferred Stock and Warrants shall be those in effect on the date
hereof without giving effect to the amendments contained herein, except that the
terms of the proviso in the definition of "Conversion Price", as amended hereby,
and Section (k) hereof shall remain in effect.
(b) So long as the Company is in compliance in all material respects
with its obligations to the holders of the shares of Series C Preferred Stock,
including, without limitation, the obligations of the Company under the
Transaction Documents and this Agreement, during the period beginning on the
date hereof and ending December 31, 1998, the Holder hereby waives its rights to
require the Company to redeem any shares of Series C Preferred Stock due to a
Maximum Share Amount Inconvertibility, including any rights to receive notice.
(c) The Company hereby agrees that, at any time after the date hereof,
the Holder may exchange shares of Series C Preferred Stock for shares of Common
Stock in lieu of converting such shares in accordance with the Certificate and
the Holder hereby agrees that it will not convert any shares in accordance with
the Certificate so long as the Company is in compliance in all material respects
with its obligations to the holders of the shares of Series C Preferred Stock,
including, without limitation, the obligations of the Company under the
Transaction Documents and this Agreement. The terms and conditions pursuant to
which shares of Series C Preferred Stock may be exchanged for shares of Common
Stock shall in all respects be identical to the terms pursuant to which such
shares may be converted under the Certificate and the provisions of Section 10
of the Certificate are hereby incorporated herein by this reference as if set
forth in full herein, except as set forth below:
(1) each reference in the Certificate to "conversion" or
"convert" or other forms of such words (including in the definitions contained
therein) shall be deemed to be a reference to "exchange" or the appropriate form
of such word.
(2) Section 10 of the Certificate shall be deemed to have a new Section
10(c), which shall read as follows:
"(c) Limitation on Conversion Under Certain Circumstances.
(i) Notwithstanding any other provision
herein (A) a holder of Series C Preferred Stock shall
have no right to convert any shares of Series C
Preferred Stock (and accrued and unpaid dividends
thereon) if such conversion would result in the
aggregate number of shares of Common Stock issued
hereunder during the period
#370535
<PAGE>
beginning on the Issuance Date and ending on December
31, 1998 (whether through conversion or in payment of
dividends or otherwise) exceeding 2,300,000, and (B)
during the period beginning on January 1, 1998 and
ending on December 31, 1998, a holder of shares of
Series C Preferred Stock shall not be entitled to
convert shares of Series C Preferred Stock at a
Conversion Price that is less than $4.00 if such
conversion would result in the aggregate number of
shares of Common Stock issued hereunder (whether
through conversion or in payment of dividends or
otherwise) at a Conversion Price (or Computed Price,
in the case of shares issued as dividends) of less
than $4.00 during the calendar month of the proposed
conversion for which the determination under this
clause (B) is being made exceeding 150,000 shares of
Common Stock. The Conversion Price set forth in this
Section 10(c)(1) shall be subject to adjustment on
the same basis set forth in the parenthetical phrase
in clause (1) of the definition of the term
Conversion Price (as in effect prior to this
Agreement) for any such events which occur on or
after the effective date of this Agreement.
(ii) Notwithstanding any other provision
herein, until the Stockholder Approval is obtained, a
holder of Series C Preferred Stock shall have no
right to convert any shares of Series C Preferred
Stock (and accrued and unpaid dividends thereon) if
such conversion would result in the aggregate number
of shares of Common Stock issued hereunder (whether
through conversion or in payment of dividends or
otherwise) exceeding 1,250,000.
(iii) The provisions contained in this
Section 10(c) shall be of no further force and effect
if (i) the Company is acquired by another person by
means of any merger, consolidation, sale or all or
substantially all assets of the Company, share
exchange or other business combination (each, a
"Transaction"), (ii) the Company enters into any
Transaction where the shareholders of the Company
immediately prior to such Transaction do not
collectively own at least 51% of the outstanding
voting securities of the surviving corporation of
such Transaction immediately following such
Transaction, (iii) the Company enters into any
agreement for any such Transaction, (iv) a Tender
Offer is consummated for at least 51% of the
outstanding shares of Common Stock or (v) the Company
fails to comply in any material respect with its
obligations to any holder of shares of Series C
Preferred Stock, including, without limitation, its
obligations arising under or in connection with this
Certificate of Designations, the Subscription
Agreement, the Transfer Instruction, the Warrants (as
defined in the Subscription Agreement) and of the
letter
#370535
<PAGE>
agreement, dated as of January 6, 1998, by and between the Company and
Advantage Fund II, Ltd."
(3) The definition of Conversion Price in Section 1(b) of the
Certificate of Designations shall be deemed to read as follows:
"Conversion Price" for any Conversion Date means 95%
of the lowest Two-Day Average Trading Price during
the Measurement Period for the applicable Conversion
Date; provided, however, that (i) on any date on or
after March 1, 1998 but prior to June 1, 1998, the
Conversion Price shall not be greater than 110% of
the arithmetic average of the Trading Prices of the
Common Stock for the period of 30 consecutive Trading
Days ending one Trading Days prior to March 1, 1998
(the "March Cap") and (ii) on any date on or after
June 1, 1998, the Conversion Price shall not be
greater than the lesser of (A) 110% of the arithmetic
average of the Trading Price of the Common Stock for
the period of thirty (30) consecutive Trading Days
ending one Trading Day prior to June 1, 1998 and (B)
the March Cap (subject, in the case of the amount
determined in accordance with this proviso, to
equitable adjustments from time to time on terms
reasonably acceptable to the Corporation and the
Majority Holders for (1) stock splits, (2) stock
dividends, (3) combinations, (4) capital
reorganizations (5) issuance to all holders of Common
Stock rights or warrants to purchase shares of Common
Stock, (6) the distribution by the Corporation to all
holders of Common Stock of evidences of indebtedness
of the Corporation or cash (other than regular
quarterly cash dividends), (7) Tender Offers by the
Corporation or any Subsidiary for, or other
repurchases of shares of, Common Stock in one or more
transactions which, individually or in the aggregate,
result in the purchase of more than ten percent of
the Common Stock outstanding and (8) similar events
relating to the Common Stock, in each such case which
occur, or with respect to which "ex-" trading of the
Common Stock begins, on or after March 1, 1998 and on
or before the applicable Conversion Date, in each
case on a basis consistent with the adjustments set
forth in the definition of Trading Price); and
provided further, however, that if an Adjustment
Event occurs, then the Conversion Price in effect on
any date after such Adjustment Event occurs (and
whether or not such Adjustment Event continues) shall
be adjusted to each date on which the Conversion
Price is being determined as follows: (x) in the case
of the Conversion Price provided in the main clause
of this definition, the percentage used in computing
such Conversion Price shall be reduced at the rate of
2.5 percentage points for each 30 days that such
Adjustment Event continues (pro rated for any period
of less than 30
#370535
<PAGE>
days) and (y) in the case of the Conversion Price
provided in the first proviso to this definition, the
Conversion Price determined in accordance therewith
shall be reduced at the rate of 2.5% of such
Conversion Price (computed on the basis of the amount
such Conversion Price would otherwise be without
regard to any adjustment therein pursuant to this
clause (y)) for each 30 days on or after March 1,
1998 that such Adjustment Event continues (pro rated
for any period of less than 30 days).
(d) The parties agree that they shall have the rights and obligations
set forth below as if Section 7 of the Certificate had been amended to add a new
Section 7(a)(8), which shall read as follows:
"(8) If at any time following the Stockholder
Approval, the Company or the holder of shares of Series C
Preferred Stock becomes aware of any facts that would cause
any outstanding shares of Series C Preferred Stock to be
inconvertible, other than a Maximum Share Amount
Inconvertibility or a Registration Restriction
Inconvertibility, such person shall promptly give written
notice of such facts to the other person. Within 10 Business
Days after receipt of such notice by the receiving person, if
the parties agree that such inconvertibility exists, such
holder shall have the right by a Redemption Election given to
the Corporation to direct the Corporation to redeem the
portion of such holder's outstanding shares of Series C
Preferred Stock (which, if applicable, shall be all of such
holder's outstanding shares of Series C Preferred Stock) as
shall not, on the Business Day prior to the date of such
redemption, be convertible into shares of Common Stock by
reason other than a Maximum Share Amount Inconvertibility or
Registration Restriction Inconvertibility, at a price per
share equal to the Share Limitation Redemption Price. Such
Share Limitation Redemption Price shall be payable by the
Company in four equal monthly installments and the shares of
Series C Preferred Stock held by such holder shall be redeemed
in four equal installments as such payments are made. If at
any time subsequent to a determination pursuant to this
Section 7(a)(8) of the number of inconvertible shares of
Series C Preferred Stock any such inconvertibility shall occur
with respect to additional shares of Series C Preferred Stock
held by such holders, the provisions of this Section 7(a)(8)
shall be applicable successively to each instance of such
inconvertibility."
(e) The parties agree that they will not enforce their rights contained
in Section 9(a)(2) of the Certificate and will instead have the rights and
obligations set forth below as if Section 9(a)(2) of the Certificate had been
amended to read as follows:
(2) The Company shall not be entitled to give a
Redemption Notice or to redeem any shares of Series C
Preferred Stock with respect to which a holder has given a
Conversion Notice. Notwithstanding the giving of a Redemption
Notice, each holder of shares of Series C Preferred Stock
#370535
<PAGE>
shall be entitled to convert in accordance with Section 10
such shares of Series C Preferred Stock held by such holder
which are otherwise to be redeemed in accordance with such
Redemption Notice and would convert into shares of Common
Stock sufficient to cover open and short positions in the
Common Stock held by such holder on the date of the Redemption
Notice by giving a Conversion Notice at any time prior to the
later of (1) the date that is one Business Day prior to the
Redemption Date and (2) the date on which the Corporation pays
the Redemption Price of such shares to such holder; provided,
however, that if the Company defaults in payment of the
Redemption Price, such holder shall thereafter be entitled to
convert all of such holder's shares of Series C Preferred
Stock.
(f) The definitions of "Redemption Date" and "Redemption Price" in
Section 1(b) of the Certificate shall be deemed to read as follows:
"Redemption Date" means, as applicable, a 1998 Redemption Date
or a Subsequent Redemption Date.
"Redemption Price" means, as applicable, the 1998 Redemption
Price or the Subsequent Redemption Price. The 1998 Redemption
Price shall be payable on any 1998 Redemption Date and the
Subsequent Redemption Price shall be payable on any Subsequent
Redemption Date.
(g) The following definitions shall be deemed to be added to Section 1(b)
of the Certificate in the appropriate alphabetical order:
"1998 Redemption Date" means each date on or prior to December
31, 1998 on which the Corporation is required to redeem shares
of Series C Preferred Stock by reason of the exercise of its
option to do so in accordance with Section 9(a).
"1998 Redemption Price" means an amount in cash equal to the
sum of (a) the product obtained by multiplying (i) the sum of
(A) $1,000 plus (B( an amount equal to the accrued but unpaid
dividends on the share of Series C Preferred Stock to be
redeemed to the date of payment of the Redemption Price times
(ii) 130% plus (b) an amount equal to accrued and unpaid
Arrearage Interest on dividends in arrears on such share of
Series C Preferred Stock (determined in accordance with
Section 5(a)) to the Redemption Date.
"Subsequent Redemption Date" means each date beginning on
January 1, 1999 on which the Corporation is required to redeem
shares of Series C Preferred Stock by reason of the exercise
of its option to do so in accordance with Section 9(a).
#370535
<PAGE>
"Subsequent Redemption Price" means an amount in cash equal to
the sum of (a) the product obtained by multiplying (i) the sum
of (A) $1,000 plus (B) an amount equal to the accrued but
unpaid dividends on the share of Series C Preferred Stock to
be redeemed to the date of payment of the Redemption Price
times (ii) 110% plus (b) an amount equal to accrued and unpaid
Arrearage Interest on dividends in arrears on such share of
Series C Preferred Stock (determined in accordance with
Section 5(a)) to the Redemption Price.
(h) On and after the date hereof, so long as paragraph (c) hereof
remains in effect, the Company shall treat any request for conversion of Series
C Preferred Stock submitted by a holder in accordance with the terms and
conditions of the Certificate as a request or exchange in accordance with the
terms and conditions hereof.
(i) Within 10 Business Days after the date hereof, the Company will (1)
execute and deliver the Transfer Agent Instructions in a form to be agreed and
thereby irrevocably instruct American Stock Transfer & Trust Company, as
Transfer Agent and Registrar (the "Transfer Agent"), to issue certificates for
the Common Stock from time to time upon exchange of the Series C Preferred
Shares in such amounts as specified from time to time to the Transfer Agent in
the Conversion Notices surrendered in connection with such exchanges and (2)
appoint the Transfer Agent the exchange agent for the Series C Preferred Stock.
The certificates for the Common Shares shall be registered in the name of the
Buyer or its nominee and in such denominations to be specified by the Buyer in
connection with each exchange of Series C Preferred Shares. The Company warrants
that no instruction other than such instructions referred to in this Section (i)
will be given by the Company to the Transfer Agent and that the Common Stock
shall otherwise be freely transferable on the books and records of the Company
as and to the extent provided in this Agreement. Nothing in this Section (i)
shall limit in any way the Holders' obligations and agreement to comply with the
registration requirements of all applicable securities laws upon any resale of
Common Stock by the Holder. If the Holder provides the Company with an opinion
of counsel reasonably satisfactory in form, scope and substance to the Company
that registration of a resale by the Holder of any of the Common Stock by the
Holder of any of the Common Stock is not required under the 1933 Act, the
Company shall permit the transfer of such Common Stock and promptly instruct the
Company's transfer agent to issue upon transfer no later than three days after
receipt of such opinion one or more share certificates in such name and in such
denominations as specified by the Holder.
(j) Any notice of exchange of shares of Series C Preferred Stock by a
Holder pursuant hereto shall be in the form of the Conversion Notice included in
the Certificate.
(k) The definition of "Purchase Price" in the Warrants is amended by
deleting "$10.00" and replacing it with "$2.50."
(l) (1) Within five Business Days of the date hereof, the Company shall
(i) file a Current Report on Form 8-K describing the terms of this Amendment
Agreement (the "8-K") and (ii) make a good faith determination within five days
after execution of this
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<PAGE>
Agreement of whether, pursuant to Section 8 of the Subscription Agreement, the
Company is required to file an additional Registration Statement or to amend the
existing Registration Statement and notify the Holder in writing of such
determination. Notwithstanding Section 8(a) of the Subscription Agreement, if
the Company so determines that such a filing is required, the Company shall file
such Registration Statement within 15 days after the date hereof or such
amendment within five Business Days after the date hereof.
(2) This Agreement constitutes a notice pursuant to Section
8(b)(5) of the Subscription Agreement and accordingly the Holder agrees that it
will not sell any securities pursuant to the Prospectus until the Company gives
the Holder notice that it may thereafter do so. The Company hereby confirms that
it will use its best efforts to make the Prospectus available within five
Business Days after the date hereof.
(3) During the period beginning on the date hereof and ending
on the earliest to occur of (i) effectiveness of an amendment to the existing
Registration Statement or (ii) a good faith determination by the Company that no
such amendment is required and the filing of the 8-K, or (iii) the date which is
30 days after the date of this Agreement, the Holder (A) waives its rights under
Section 11 of the Certificate to require the Company to redeem any shares of
Preferred Stock by reason of clause (5) of the definition of Optional Redemption
Event and (B) agrees that no Adjustment Event shall be deemed to have occurred
with respect to the Registration Statement.
(4) Notwithstanding Section 8(a) of the Subscription
Agreement, if the Company is required, pursuant to Section 8 of the Subscription
Agreement, to file an additional Registration Statement to register shares of
Common Stock issuable upon conversion of the Series C Preferred Stock following
the Stockholder Approval, it will do so within 15 days after obtaining the
Stockholder Approval. Notwithstanding any inconsistent provision in Section 8 of
the Subscription Agreement, the Company will use its best efforts to have such
Registration Statement declared effective as soon as possible but in no event
later than 75 days after obtaining the Stockholder Approval. Such Registration
Statement and the related prospectus shall otherwise be deemed to be included in
the terms ARegistration Statement@ and AProspectus.@ During the period beginning
on the date on which the Stockholder Approval is effected and ending on the
earlier to occur of (i) effectiveness of such additional Registration Statement
or (ii) the date that is 75 days after the date on which the Stockholder
Approval is effected, the Holder agrees that no Adjustment Event shall be deemed
to have occurred with respect to the Registration Statement.
(m) Prior to transferring any shares of Preferred Stock, the Holder
shall provide the transferee with a copy of this Agreement and such transferee
shall agree in writing to be bound by the terms hereof. The Company agrees to be
bound by the terms of this Agreement for the benefit of each such transferee.
(n) The Holder represents and warrants that it has all requisite power and
authority, corporate or otherwise, to execute, deliver and perform its
obligations under this
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<PAGE>
Agreement and the Transaction Documents and to consummate the transactions
contemplated hereby and thereby; and this Agreement has been duly authorized,
executed and delivered on behalf of the Holder and, assuming due execution and
delivery by the Company, is a valid and binding agreement of the Holder
enforceable in accordance with its terms, except as the enforceability hereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to or affecting creditors'
rights generally and general principles of equity, regardless of whether
enforcement is considered in a proceeding in equity or at law.
(o) The Company represents and warrants to the Holder that:
(1) The Company has duly reserved 1,250,000 shares of Common
Stock as the Conversion Shares and 175,000 shares of Common Stock as the Warrant
Shares, and such shares shall remain so reserved (subject to reduction from time
to time for shares of Common Stock issued upon conversion of Preferred Shares
and exercise of the Warrant), and the Company shall from time to time reserve
such additional shares of Common Stock as shall be required to be reserved
pursuant to the Certificate of Designations, as long as the Preferred Shares are
convertible, and pursuant to the Warrants, so long as the Warrants are
exercisable. The Common Stock is listed for trading on Nasdaq and (1) the
Company and the Common Stock meet the criteria for continued listing and trading
on Nasdaq; (2) the Company has not been notified since January 1, 1995 by the
NASD of any failure or potential failure to meet the criteria for continued
listing and trading on Nasdaq and (3) no suspension of trading in the Common
Stock is in effect. The Company knows of no reason that the Common Shares will
not be eligible for listing on Nasdaq.
(2) This Agreement has been duly authorized, executed and
delivered on behalf of the Company and this Agreement is, assuming due execution
by the Holder, is a valid and binding obligation of the Company enforceable in
accordance with its terms, except as the enforceability hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally and
general principles of equity, regardless of whether endorsement is considered in
a proceeding in equity or at law.
(3) The execution and delivery of this Agreement and the
consummation by the Company of the transactions contemplated by do not and will
not, with or without the giving of notice or the lapse of time, or both, (i)
result in any violation of any term of the certificate of incorporation or
by-laws of the Company or any Subsidiary, (ii) conflict with or result in a
breach by the Company or any Subsidiary of any of the terms or provisions of, or
constitute a default under, or result in the modification of, or result in the
creation or imposition of any lien, security interest, charge or encumbrance
upon any of the properties or assets of the Company or any Subsidiary pursuant
to, any indenture, mortgage, deed of trust or other agreement or instrument to
which the Company or any Subsidiary is a party or by which the Company or any
Subsidiary or any of their respective properties or assets are bound or
affected, (iii) violate or contravene any applicable law, rule or regulation or
any applicable decree, judgment or order of any court, United States federal or
state regulatory
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<PAGE>
body, administrative agency or other governmental body having jurisdiction over
the Company or any Subsidiary or any of their respective properties or assets or
(iv) have any material adverse effect on any permit, certification,
registration, approval, consent, license or franchise necessary for the Company
or any Subsidiary to own or lease and operate any of their respective properties
and to conduct any of their respective businesses or the ability of the Company
or any Subsidiary to make use thereof.
(4) No authorization, approval or consent of any court,
governmental body, regulatory agency, self-regulatory organization, or stock
exchange or market or the stockholders of the Company is required to be obtained
by the Company or any Subsidiary for (1) the execution, delivery and performance
by the Company of this Agreement, (2) the issuance and sale of shares of Common
Shares upon conversion of, or in payment of dividends on, the Preferred Shares
and upon exercise of the Warrants as contemplated by the Certificate and the
Warrants, (3) the issuance of Redemption Price Notes pursuant to the Certificate
and (4) the performance by the Company of its other obligations under the
Transaction Documents, other than (1) listing of the additional Common Shares on
Nasdaq, (2) registration of the resale of the Common Shares under the 1993 Act
as contemplated by Section 8, (3) as may be required under applicable state
securities or "blue sky" laws.
(5) Once the Stockholder Approval has been obtained and a
certificate of amendment to the Company's certificate of incorporation has been
filed to increase the number of authorized shares of Common Stock, the
additional shares of Common Stock issuable upon conversion or exchange of the
shares of Series C Preferred Stock will be duly authorized and, upon issuance
upon conversion or exchange of the shares of Series C Preferred Stock, will be
validly issued and fully paid and non-assessable.
(p) The parties hereto agree that the condition set forth on the signature
page hereto has been satisfied.
* * * * *
This Amendment Agreement is conditioned upon the amendment of the terms
of at least 80% of the outstanding principal amount of the Company's 5% Senior
Convertible Notes due June 4, 2000, substantially on the terms set forth on
Exhibit A to the Agreement in Principle, dated as of January 6, 1998 by and
among the Company and holders named therein.
ADVANTAGE FUND II, LTD.
By: /s/
Acknowledged and agreed:
NAPRO BIOTHERAPEUTICS, INC.
By: /s/ Gordon H. Link, Jr.
Date:1/28/98
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<PAGE>
Exhibit 4.3
AMENDMENT NO. 2 TO AGREEMENT IN PRINCIPLE
THIS AMENDMENT NO. 2 TO AGREEMENT IN PRINCIPLE, dated as of January 27,
1998 (this "Amendment"), by and between NAPRO BIOTHERAPEUTICS, INC., a Delaware
corporation (the "Company"), and the undersigned holder (the "Holder") of one of
the Company's Senior Convertible Notes due June 4, 2000 (the "Note").
The Company and the Holder agree as follows:
1. The Company and the Holder have executed and delivered, one to the
other, an Agreement in Principle, dated as of January 6, 1998, as amended by
Amendment No. 1 thereto, dated January 16, 1998 (as so amended, the
"'Agreement").
2. The Agreement is hereby amended to change the per share dollar amount in
Section 2 of the Agreement from $3.75 to $3.00.
3. Except as modified hereby, the Agreement remains in full force and
effect in accordance with its terms.
4. This Amendment shall be governed by and construed in accordance with
the laws of the State of New York applicable to contracts to be made and
performed entirely in the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their officers or other representatives as of the date first
set forth above.
NAPRO BIOTHERAPEUTICS, INC.
By: /s/ Gordon H. Link, Jr.
Name: Gordon H. Link, Jr.
Title: Vice President
OMICRON PARTNERS, L.P.
By: /s/
Name:
Title:
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<PAGE>
