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SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. ______________)*
MIRAVANT MEDICAL TECHNOLOGIES
- -------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, Par Value $0.01 Per Share
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(Title of Class of Securities)
6932P103
----------------------------------------------------
(CUSIP Number)
Richard T. Collier
Senior Vice President
and General counsel
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, NJ 08807
- -------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
February 18, 1999
----------------------------------------------------
(Date of Event which Requires Filing of this Statement)
OMB APPROVAL If the filing person has previously filed a statement on Schedule
13G to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box |_|.
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7 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).
SEC 1746(12-91)
<PAGE>
SCHEDULE 13D
- --------------------- ------------------
CUSIP NO. 69329P103 PAGE 2 OF 31 PAGES
- --------------------- ------------------
- -------------------------------------------------------------------------------
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Pharmacia & Upjohn Company
- -------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(A) |_|
(B) |_|
- -------------------------------------------------------------------------------
3. SEC USE ONLY
- -------------------------------------------------------------------------------
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC
- -------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
|_|
- -------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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NUMBER OF 7. SOLE VOTING POWER
SHARES 125,001
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8. SHARED VOTING POWER
EACH -0-
REPORTING --------------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH 125,001
--------------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
125,001
- -------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
|_|
- -------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.7%
- -------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
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<PAGE>
SCHEDULE 13D
- --------------------- ------------------
CUSIP NO. 69329P103 PAGE 3 OF 31 PAGES
- --------------------- ------------------
- -------------------------------------------------------------------------------
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Pharmacia & Upjohn S.p.A.
- -------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP(SEE INSTRUCTIONS)
(A) |_|
(B) |_|
- -------------------------------------------------------------------------------
3. SEC USE ONLY
- -------------------------------------------------------------------------------
4. SOURCE OF FUNDS(SEE INSTRUCTIONS)
WC
- -------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
|_|
- -------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Italy
- -------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES 1,736,533
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8. SHARED VOTING POWER
EACH -0-
REPORTING --------------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH 1,736,533
--------------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,736,533
- -------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
|_|
- -------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.1%
- -------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
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<PAGE>
SCHEDULE 13D
- --------------------- ------------------
CUSIP NO. 69329P103 PAGE 4 OF 31 PAGES
- --------------------- ------------------
- -------------------------------------------------------------------------------
1. NAME OF REPORTING PERSONS
DENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Pharmacia & Upjohn AB
- -------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(A) |_|
(B) |_|
- -------------------------------------------------------------------------------
3. SEC USE ONLY
- -------------------------------------------------------------------------------
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
- -------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
|_|
- -------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Sweden
- -------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES 1,736,533
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8. SHARED VOTING POWER
EACH -0-
REPORTING --------------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH 1,736,533
--------------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,736,533
- -------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
|_|
- -------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.1%
- -------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
- -------------------------------------------------------------------------------
<PAGE>
SCHEDULE 13D
- --------------------- ------------------
CUSIP NO. 69329P103 PAGE 5 OF 31 PAGES
- --------------------- ------------------
- -------------------------------------------------------------------------------
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Pharmacia & Upjohn Holdings B.V.
- -------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) |_|
(B) |_|
- -------------------------------------------------------------------------------
3. SEC USE ONLY
- -------------------------------------------------------------------------------
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
- -------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
|_|
- -------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Netherlands
- -------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES 1,736,533
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8. SHARED VOTING POWER
EACH -0-
REPORTING --------------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH 1,736,533
--------------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,736,533
- -------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
|_|
- -------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.1%
- -------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OO
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<PAGE>
SCHEDULE 13D
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CUSIP NO. 69329P103 PAGE 6 OF 31 PAGES
- --------------------- ------------------
- -------------------------------------------------------------------------------
1. NAME OF REPORTING PERSONS (ENTITIES ONLY).
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Pharmacia & Upjohn, Inc.
- -------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(A) |_|
(B) |_|
- -------------------------------------------------------------------------------
3. SEC USE ONLY
- -------------------------------------------------------------------------------
4. SOURCE OF FUNDS
AF
- -------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
|_|
- -------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES 1,861,534
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8. SHARED VOTING POWER
EACH -0-
REPORTING --------------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH 1,861,534
--------------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,861,534
- -------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) |_|
- -------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.8%
- -------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO, HC
- -------------------------------------------------------------------------------
<PAGE>
SCHEDULE 13D
CUSIP NO: 69329P103 PAGE 7 OF 31
ITEM 1. SECURITY AND ISSUER
The class of equity securities to which this statement relates is the
shares of Common Stock, par value $.01 per share (the "Shares"), of Miravant
Medical Technologies (formerly PDT, Inc.), a Delaware corporation ("Miravant").
The principal executive office of Miravant is located at 7408 Hollister Avenue,
Santa Barbara, California 93117.
ITEM 2. IDENTITY AND BACKGROUND
This statement is being filed by Pharmacia & Upjohn AB (formerly
Pharmacia AB), a Swedish corporation ("P&U AB"), Pharmacia & Upjohn S.p.A.
(formerly Pharmacia S.p.A.), an Italian corporation ("P&U S.p.A."), Pharmacia &
Upjohn Company, a Delaware corporation ("P&U Co."), Pharmacia & Upjohn Holdings
B.V., a "check the box" entity incorporated in the Netherlands ("P&U BV") and
Pharmacia & Upjohn, Inc. ("P&U Inc.", and together with P&U AB, P&U Co., P&U BV
and P&U S.p.A., the "Reporting Persons").
The principal business address of P&U S.p.A. is Pharmacia & Upjohn
S.p.A., via Robert Koch 1.2, 75017 Milan, Italy. The principal business address
of P&U AB is Pharmacia & Upjohn AB, S-171 97 Stockholm, Sweden. The principal
business address of P&U BV is Pharmacia & Upjohn Holdings B.V., Houttuinlaan 4,
NL - 3447 GM Woerden, The Netherlands. The principal business address of both
P&U Inc. and P&U Co. is Pharmacia & Upjohn, Inc., 95 Corporate Drive,
Bridgewater, New Jersey 08807.
P&U S.p.A. is an Italian corporation and a subsidiary of P&U AB, a
Swedish corporation, which, in turn, is a wholly owned subsidiary of P&U BV, a
"check the box" entity incorporated in the Netherlands. P&U BV and P&U Co. are
wholly owned subsidiaries of P&U Inc., a Delaware corporation. P&U Co., a
Delaware corporation, is the successor to Pharmacia, Inc., a
<PAGE>
CUSIP Number: 69329P103 Page 8 of 31
Minnesota corporation and a former wholly owned subsidiary of P&U AB. The
principal business of each of the Reporting Persons is the development,
production, marketing and sale of pharmaceutical products.
The name, residence or business address, present principal occupation
or employment, and the citizenship of each of each director and executive
officer of (i) P&U S.p.A. is set forth in Schedule I hereto and incorporated
herein by reference, (ii) P&U Co. is set forth in Schedule II hereto and
incorporated herein by reference, (iii) P&U Inc. is set forth in Schedule III
hereto and incorporated herein by reference.
None of the Reporting Persons, or to the best knowledge and belief of
the Reporting Persons, any of the individuals listed in Schedule I, II or III
has, during the past five years, been convicted in any criminal proceeding
(excluding traffic violations or similar misdemeanors) or has been a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
This Item 2 is qualified in its entirety by reference to Schedules I,
II and III which are incorporated herein by reference.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
In 1994, Pharmacia, Inc., a former wholly owned subsidiary of P&U AB as
to which P&U Co. is the successor by merger, purchased 83,334 Shares of Miravant
and was granted a warrant, dated as of August 31, 1994 and incorporated by
reference as Exhibit C hereto (the "PDT Warrant") to purchase an additional
41,667 Shares of Miravant for $1,000,008, the source
<PAGE>
CUSIP Number: 69329P103 Page 9 of 31
of which funds was working capital. The PDT Warrant issued to Pharmacia, Inc.
was not exercised and has expired.
In 1995, P&U S.p.A. purchased 400,000 Shares of Miravant for
$12,000,000, the source of which funds was working capital.
In 1995, pursuant to a 3 for 2 stock split, the holdings of Pharmacia,
Inc. were adjusted to 125,001 Shares and the holdings of P&U S.p.A. were
adjusted to 600,000 Shares.
On February 18, 1999, P&U S.p.A. purchased 1,136,533 Shares of Miravant
for $19,000,000, the source of which funds was working capital. Pursuant to the
terms of a Credit Agreement, dated February 18, 1999 between Pharmacia & Upjohn
Treasury Services AB ("P&U Treasury Services") and Miravant and filed as Exhibit
H hereto (the "Credit Agreement"), P&U Treasury Services may be granted up to
360,000 Warrants (as defined in the Credit Agreement) to purchase additional
Shares if Miravant borrows up to $22,500,000 available to it under the Credit
Agreement, and, subject to certain conditions, Miravant may, at its option,
repay at maturity any amounts borrowed under the Credit Agreement with a number
of Shares of Miravant that will vary depending on the market price of the Shares
at the time of repayment and the principal amount of borrowings repaid.
The Reporting Persons have not sold any Shares of Miravant.
None of the persons listed on Schedule I, II or III hereto has
contributed any funds or other consideration towards the purchase of the Shares
of Miravant reported in this statement.
ITEM 4. PURPOSE OF TRANSACTION
The Shares of Miravant described by this statement were acquired for
investment purposes. Other than as set forth herein,
<PAGE>
CUSIP Number: 69329P103 Page 10 of 31
the Reporting Persons do not have plans or proposals which relate to or would
result in any of the events described by Items 4(a) through 4(j) of Schedule 13D
other than the following:
(i) The Credit Agreement provides that the aggregate outstanding
principal of the loans shall be repaid in full, together with
any accrued interest as of the date of repayment, not later
than the fifth anniversary of the borrowing date for the first
Loan made pursuant to the Credit Agreement (the "Maturity
Date"). On the Maturity Date and subject to certain
conditions, Miravant may, at its option, repay all or a
portion of the aggregate principal of the loans, together with
any accrued interest as of the Maturity Date, in its Shares.
The number of Shares of Miravant issued to P&U Treasury
Services or one of its affiliates will vary depending on the
market price of the Shares at the time of repayment and the
principal amount of borrowings repaid.
(ii) The Credit Agreement provides that Miravant will issue to
P&U Treasury Services or one of its affiliates, in respect of
each $62.50 in principal amount of loans extended under the
Credit Agreement, one warrant to purchase Common Stock of
Miravant having the terms set forth in the Warrant Agreement,
dated February 18, 1999, between Miravant and P&U Treasury
Services and filed as Exhibit F hereto (the "Warrant
Agreement"). If Miravant borrows the full $22,500,000
available under the Credit Agreement, P&U Treasury Services or
one of its affiliates will acquire 360,000 Warrants. The
exercise price of each warrant will be equal to 140% of the
average of the closing prices of the Common Stock for the ten
trading days immediately preceding the borrowing request for
the related loan. The Warrants will expire on the fifth
anniversary of the first borrowing made pursuant to the Credit
Agreement.
<PAGE>
CUSIP Number: 69329P103 Page 11 of 31
(iii) The Equity Investment Agreement, dated January 15, 1999,
P&U Inc., P&U S.p.A. and Miravant and filed as Exhibit D
hereto (the "Original Equity Investment Agreement"), as
amended by the Agreement and Amendment to the Equity
Investment Agreement, dated as of February 17, 1999, by and
between Miravant, P&U Inc. and P&U S.p.A. and filed as
Exhibit E hereto (together with the Original Equity Investment
Agreement, the "Equity Investment Agreement"), provides that,
subject to certain limitations, unless specifically requested
in advance by the Miravant's Board of Directors, neither
P&U Inc. nor any of its affiliates will, and P&U Inc. and its
affiliates will not assist or encourage others to, directly
or indirectly, acquire or agree, offer, seek or propose to
acquire ownership of any securities issued by Miravant or
enter into any discussions, negotiations, arrangements or
understandings with any person with respect to any of the
foregoing until the sooner to occur of July 1, 2000 or the
occurrence of certain other events. See Item 6.
(iv) The Registration Rights Agreement, dated as of February 18,
1999, between Miravant and P&U Inc. and filed as Exhibit G
hereto (the "Registration Rights Agreement"), provides that
(i) the holders of Shares received by the Reporting Persons
pursuant to the Equity Investment Agreement or the Warrant
Agreement have the right to demand that Miravant file
registration statements with respect to such Shares of
Miravant held by such holders and (ii) P&U Inc. and its
subsidiaries have certain rights to participate in other
registered offerings of Shares of Miravant. See Item 6.
(v) The Warrant Agreement provides that (i) Miravant is entitled
to purchase any Warrant issued pursuant to the Credit
Agreement and Warrant Agreement should the average closing
price for the Shares of Miravant over any consecutive 30
trading days exceed the exercise
<PAGE>
CUSIP Number: 69329P103 Page 12 of 31
price for such Warrant, and (ii) at such time as a Reporting
Person seeks to exercise a Warrant, Miravant has the right, in
its sole discretion, to pay a certain cash amount in lieu of
delivering the Shares issuable in respect thereof. See Item 6.
(vi) See Item 6 for a discussion of the anti-dilution provisions of
Shares issuable upon exercise of the Warrants that may result
in the acquisition of additional Shares by the Reporting
Persons.
The foregoing discussion is qualified in its entirety by reference to
the Stock Purchase Agreement, dated as of July 1, 1995, by and between PDT, Inc.
and Pharmacia S.p.A. and incorporated by reference as Exhibit A hereto (the
"Stock Purchase Agreement"), the PDT, Inc. $10,000,000 Common Stock and Warrants
Offering Investment Agreement, dated as of August 31, 1994, by and between PDT,
Inc. and Pharmacia, Inc. and incorporated by reference as Exhibit B hereto (the
"1994 Stock Purchase Agreement"), the PDT Warrant, the Equity Investment
Agreement, the Warrant Agreement, the Registration Rights Agreement and the
Credit Agreement, which are either filed as exhibits or incorporated by
reference as exhibits hereto, each of which is incorporated by reference in
their entirety into this Item 4.
Each Reporting Person expects to evaluate on an ongoing basis
Miravant's financial condition, business operations and prospects, market price
of the Shares of Miravant, conditions in securities markets generally, general
economic and industry conditions and other factors. Accordingly, each Reporting
Person reserves the right to change its plans and intentions at any time, as it
deems appropriate. In particular, each Reporting Person may at any time and from
time to time acquire additional Shares of Miravant or securities convertible or
exchangeable for Shares of Miravant; may dispose of Shares of Miravant; and/or
may enter into privately negotiated derivative transactions with institutional
counterparties to hedge the market risk of some or
<PAGE>
CUSIP Number: 69329P103 Page 13 of 31
all of its positions in such Shares. Any such transactions may be effected at
any time and from time to time subject to any applicable limitations of the
Securities Act and the contractual restrictions described in Item 6. To the
knowledge of each Reporting Person, each of the persons listed on Schedule I,
Schedule II and Schedule III hereto may make the same evaluation and reserves
the same rights.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) The percentage interest held by each Reporting Person presented
below is based on the number of Shares of Miravant reported to be outstanding as
of October 31, 1998 in Miravant's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998, as adjusted to give effect to the issuance of the
Shares of Miravant issued pursuant to the Equity Investment Agreement (the
"Outstanding Shares").
P&U Co., as successor to Pharmacia, Inc., beneficially owns 125,001
Shares of Miravant, representing approximately 0.7% of the Outstanding Shares.
P&U S.p.A. beneficially owns 1,736,533 Shares of Miravant, representing
approximately 10.1% of the Outstanding Shares.
P&U AB may be deemed to beneficially own 1,736,533 Shares of Miravant,
representing approximately 10.1% of the Outstanding Shares.
P&U BV may be deemed to beneficially own 1,736,533 Shares of Miravant,
representing approximately 10.1% of the Outstanding Shares.
P&U Inc. may be deemed to beneficially own 1,861,534 Shares of
Miravant, representing approximately 10.8% of the Outstanding Shares.
<PAGE>
CUSIP Number: 69329P103 Page 14 of 31
None of the Reporting Persons, and to the knowledge of the Reporting
Persons, none of the persons listed in Schedules I, II and III hereto
beneficially owns any Shares of Miravant other than as set forth herein.
(b) Each Reporting Person has the power to vote or direct the vote and
dispose or direct the disposition of the Shares beneficially owned by such
Reporting Persons as indicated in pages 2 through 6 above.
(c) None of the Reporting Persons and, to the knowledge of the
Reporting Persons, none of the persons listed on Schedule I, II or III hereto,
has been party to any transaction in Shares of Miravant during the past sixty
days.
(d) No other person has the right to receive or the power to direct the
receipt of dividends from or proceeds from the sale of Shares of Miravant.
(e) Not Applicable.
The foregoing discussion is qualified in its entirety by reference to
the Stock Purchase Agreement, the 1994 Stock Purchase Agreement, the PDT
Warrant, the Equity Investment Agreement, the Registration Rights Agreement, the
Warrant Agreement and the Credit Agreement, each of which is incorporated herein
by reference.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER
There are no contracts, arrangements, understandings or relationships
between the Reporting Persons (or their wholly owned subsidiaries) and other
persons with respect to the Shares of Miravant aside from the following:
(a) The Stock Purchase Agreement, under which P&U S.p.A.
(i) received rights to initiate registration of the
<PAGE>
CUSIP Number: 69329P103 Page 15 of 31
non-registered Shares of Miravant which are held by P&U
S.p.A.; (ii) received rights to participate in certain
registrations initiated by Miravant or othe shareholders of
Miravant; and (iii) agreed not to transfer the 400,000 Shares
which P&U S.p.A. received on July 1, 1994 for one year unless
certain conditions are met. Pursuant to the Equity Investment
Agreement, Section 5.5 of the Stock Purchase Agreement, which
prevented Pharmacia S.p.A. from directly or indirectly
acquiring additional Miravant securities without first
receiving approval from Miravant's board of Directors until
July 1, 2000, is void ab initio.
(b) The 1994 Stock Purchase Agreement, under which Pharmacia, Inc.
received the right to cause PDT, Inc. to register Shares held
by Pharmacia, Inc. and to participate in certain registrations
initiated by PDT, Inc. and/or other shareholders of PDT, Inc.
(the "1994 Stock Purchase Agreement").
(c) The PDT Warrant, under which Pharmacia, Inc. was granted a
warrant to purchase up to 41,667 Shares (pre-split) of
Miravant for the price of $12.00 per share (pre-split). The
PDT Warrant was not exercised and has expired.
(d) The Equity Investment Agreement, under which P&U S.p.A.
purchased from Miravant 1,136,533 Shares of Miravant for an
aggregate purchase price of $19,000,000. Pursuant to the
Equity Investment Agreement, prior to the 180th calendar day
following closing, P&U Inc. and its subsidiaries will not
sell, assign, transfer or otherwise dispose of any of the
Shares received pursuant to the Equity Investment Agreement,
except that P&U Inc. may transfer any of such Shares to any
of its wholly owned subsidiaries. Moreover, the Equity
Investment Agreement provides that prior to the earliest of
(i) the occurrence of an Event of Default
<PAGE>
CUSIP Number: 69329P103 Page 16 of 31
(as defined in the Credit Agreement), (ii) the commencement of
a tender offer by any person or entity, other than P&U Inc. or
any of its wholly owned subsidiaries, for Shares of Miravant,
and (iii) July 1, 2000, unless specifically requested in
advance by the Miravant's Board of Directors, neither P&U Inc.
nor any of its affiliates will, and P&U Inc. and its
affiliates will not assist or encourage others (including by
providing financing) to, directly or indirectly, acquire or
agree, offer, seek or propose to acquire ownership of any
securities issued by Miravant (including but not limited to
beneficial ownership (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934)) or enter into any
discussions, negotiations, arrangements or understandings with
any person with respect to any of the foregoing; provided that
such provision shall not prohibit (i) the acquisition by P&U
Inc. and its affiliates of a number of Shares which, taken
together with the number of Shares held by P&U Inc. and its
affiliates as of the date of such acquisition, does not exceed
25% of the aggregate number of outstanding Shares as of the
date of this acquisition, (ii) the acquisition by P&U Inc. or
its affiliates of Shares pursuant to the Credit Agreement or
upon exercise of any Warrants, or (iii) the acquisition by P&U
Inc. or its affiliates of promissory notes pursuant to the
Credit Agreement or any other securities pursuant to the
Credit Documents (as defined in the Credit Agreement).
(e) The Credit Agreement, under which, subject to the terms and
conditions of such Credit Agreement, P&U Treasury Services
agreed to lend to Miravant, for general corporate purposes, an
aggregate amount not to exceed $22,500,000, in the form of up
to six term loans, with not more than one such term loan to be
made in each of the six calendar quarters between January 1,
1999 and June 30, 2000. Miravant will issue to P&U Treasury
<PAGE>
CUSIP Number: 69329P103 Page 17 of 31
Services or one of its affiliates, in respect of each $62.50
in principal amount of loans extended under the Credit
Agreement, one warrant to purchase Common Stock of Miravant
having the terms set forth in the Warrant Agreement attached
as Exhibit F hereto. If Miravant borrows the full $22,500,000
available under the Credit Agreement, P&U Treasury Services or
one of its affiliates will acquire 360,000 Warrants. The
exercise price of each warrant will be equal to 140% of the
average of the closing prices of the Common Stock for the ten
trading days immediately preceding the borrowing request for
the related loan. The Warrants will expire on the fifth
anniversary of the first borrowing made pursuant to the Credit
Agreement. Moreover, pursuant to the Credit Agreement and
subject to certain conditions, on the Maturity Date, Miravant
may, at its option, repay any amounts borrowed under the
Credit Agreement with a number of Shares of Miravant that will
vary depending on the market price of the Shares at the time
of repayment and the principal amount of borrowings repaid.
(f) The Registration Rights Agreement, under which Miravant
granted certain registration rights for Shares of Miravant
issued pursuant to the transactions contemplated by the Equity
Investment Agreement and the Warrant Agreement. Upon written
demand, a majority of holders of the Shares received by P&U
Inc. or any of its affiliates under either the Equity
Investment Agreement or the Warrant Agreement may, subject to
certain limitations, require Miravant to file a registration
statement with respect to the Shares held by such holder and
any other holder that desires to have its Shares included in
such registration statement; provided that each of the holders
shall have the right to make only three such elections to
require Miravant to file such a registration statement. P&U
Inc., together with its affiliates, also has rights,
<PAGE>
CUSIP Number: 69329P103 Page 18 of 31
subject to certain limitations, to require Miravant to include
Shares in certain other registrations of equity securities by
Miravant. The Registration Rights Agreement provides that
Miravant will indemnify the selling holders for certain
liabilities, including liabilities arising under the
Securities Act of 1933. The Registration Rights Agreement also
provides that all costs and expenses (other than underwriters'
discounts and commissions and the fees and expenses of counsel
to the selling holders as state securities officials may
require that the holders of Securities pay) incurred in
connection with the registration of the Shares pursuant to the
Registration Rights Agreement shall be paid by Miravant
(including, without limitation, all registration and filing
fees, printing expenses, costs of special audits incident to
or required by any such registration, fees and disbursements
of counsel for Miravant and up to $20,000 of fees and
disbursements of one special counsel acting for the holders of
Shares being included in any registration).
(g) The Warrant Agreement, under which each holder of Warrants is
entitled to purchase a number of Shares of Miravant equal to
one share, subject to certain anti-dilution adjustments,
provided, however, that Miravant may, at its sole election, in
lieu of delivering any Shares, pay the holder of any Warrants
so exercised a certain cash amount representing 95% of the
closing price of the Shares as of the date of exercise of such
Warrant multiplied by the number of Shares into which such
Warrant is convertible. Miravant is entitled to purchase any
Warrant issued pursuant to the Credit Agreement and Warrant
Agreement should the average closing price of the Shares of
Miravant over any 30 consecutive trading days exceed the
exercise price for such Warrant. The number of Shares issuable
upon exercise of the Warrants is subject to adjustment upon,
<PAGE>
CUSIP Number: 69329P103 Page 19 of 31
among other things, (i) the payment of a dividend on the
outstanding Shares that is payable in additional Shares or
securities convertible into additional Shares, (ii) the
subdivision of the outstanding Shares into a greater number of
shares (whether by stock split or otherwise), and (iii) the
combination of the outstanding Shares into a smaller number of
shares (whether by reverse stock split or otherwise).
The foregoing discussion is qualified in its entirety by reference to
the Stock Purchase Agreement, the 1994 Stock Purchase Agreement, the PDT
Warrant, the Equity Investment Agreement, the Registration Rights Agreement, the
Warrant Agreement and the Credit Agreement, each of which is incorporated herein
by reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit No. Exhibit Description
- ---------- -------------------
A Stock Purchase Agreement, dated as of July 1, 1995, by and
between PDT, Inc. and Pharmacia S.p.A. (incorporated by
reference from Exhibit B to the report on Schedule 13D, dated
July 7, 1995, filed by P&U AB in respect to the Shares)
B PDT, Inc. $10,000,000 Common Stock and Warrants Offering
Investment Agreement, dated as of August 31, 1994, by and
between PDT, Inc. and Pharmacia, Inc.(incorporated by
reference from Exhibit B to the report on Schedule 13D, dated
July 7, 1995, filed by P&U S.p.A. in respect to the Shares)
<PAGE>
CUSIP Number: 69329P103 Page 20 of 31
C PDT Warrant, dated as of August 31, 1994, granting Pharmacia,
Inc. a right to purchase up to 41,667 Shares (pre-split) of
PDT, Inc. for the price of $12.00 per share (pre-split)
(incorporated by reference from Exhibit C to the report on
Schedule 13D, dated July 7, 1995, filed by P&U S.p.A. in
respect to the Shares)
D Equity Investment Agreement, dated January 15, 1999, between
Miravant, P&U Inc. and P&U S.p.A.
E Agreement and Amendment to the Equity Investment Agreement,
dated as of February 17, 1999, by and between Miravant, P&U
Inc. and P&U S.p.A. F
F Warrant Agreement, dated February 18, 1999, between Miravant
and P&U Treasury Services
G Registration Rights Agreement, dated February 18, 1999,
between Miravant and P&U Treasury Services
H Credit Agreement, dated February 18, 1999, between Miravant
and P&U Treasury Services
I Joint Filing Agreement
<PAGE>
CUSIP Number: 69329P103 Page 21 of 31
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
we certify that the information set forth in this statement is true, complete
and correct.
Dated: February 26, 1999
PHARMACIA & UPJOHN COMPANY
By: /s/ Don W. Schmitz
------------------------
Title: Secretary
PHARMACIA & UPJOHN S.p.A.
By: /s/ Mats Pettersson
------------------------
Title: Attorney-In-Fact
PHARMACIA & UPJOHN AB
By: /s/ Mats Pettersson
------------------------
Title: Attorney-In-Fact
PHARMACIA & UPJOHN HOLDINGS B.V.
By: /s/ Wim Kuiper
------------------------
Title: Director
<PAGE>
CUSIP Number: 69329P103 Page 22 of 31
PHARMACIA & UPJOHN, INC.
By: /s/ Don W. Schmitz
------------------------
Title: Secretary
<PAGE>
CUSIP Number: 69329P103 Page 23 of 31
SCHEDULE I
Name, Business Address, Principal Occupation or Employment and
Citizenship of all Directors and Executive Officers of Pharmacia & Upjohn
S.p.A.:
Board of Directors
- ------------------
Maurizio Premoli
Pharmacia & Upjohn S.p.A.
via Robert Koch 1.2
20152 Milan Italy
Citizenship: Italy
Francesco Radaelli
Pharmacia & Upjohn S.p.A.
via Robert Koch 1.2
20152 Milan Italy
Citizenship: Italy
Emanuele Barie
Pharmacia & Upjohn S.p.A.
via Robert Koch 1.2
20152 Milan Italy
Citizenship: Italy
Toni Weitzberg
Chairman
Pharmacia & Upjohn S.p.A.
Lindhagensatan 133
S-112 87 Stockholm Sweden
Citizenship: Sweden
Francesco Granata
Managing Director
Pharmacia & Upjohn S.p.A.
via Robert Koch 1.2
20152 Milan Italy
Citizenship: Italy
<PAGE>
CUSIP Number: 69329P103 Page 24 of 31
Executive Officers
- ------------------
Francesco Granata
Managing Director
Pharmacia & Upjohn S.p.A.
via Robert Koch 1.2
20152 Milan Italy
Citizenship: Italy
<PAGE>
CUSIP Number: 69329P103 Page 25 of 31
SCHEDULE II
Name, Business Address, Principal Occupation or Employment and
Citizenship of all Directors and Executive Officers of Pharmacia & Upjohn
Company:
Board of Directors
- ------------------
Fred Hassan
President and CEO
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Richard T. Collier
Senior Vice President and General Counsel
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Christopher J. Coughlin
Executive Vice President and Chief Financial Officer
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Executive Officers
- ------------------
Fred Hassan
President and CEO
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
<PAGE>
CUSIP Number: 69329P103 Page 25 of 31
Goran A. Ando, M.D.
Executive Vice President
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: Sweden
Richard T. Collier
Senior Vice President and Assistant Secretary
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Timothy G. Rothwell
Executive Vice President
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Christopher J. Coughlin
Executive Vice President
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Robert G. Thompson
Senior Vice President and Controller
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
<PAGE>
CUSIP Number: 69329P103 Page 27 of 31
SCHEDULE III
Name, Business Address, Principal Occupation or Employment and
Citizenship of all Directors and Executive Officers of Pharmacia & Upjohn, Inc.:
Board of Directors:
- -------------------
Gustaf Douglas
Chairman, Investment AB Latour
Biblioteksgatan 12
S-103 88 Stockholm, Sweden
Citizenship: Sweden
Fred Hassan
President and CEO, Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Olof Lund
Chairman, Enator AB
Lojtnantsgatan 21
S-115 93 Stockholm Sweden
Citizenship: Sweden
C. Steven McMillan
President and COO, Sara Lee Corporation
Suite 4600
Three First National Plaza
70 W. Madison
Chicago, IL 60602
Citizenship: United States
<PAGE>
CUSIP Number: 69329P103 Page 28 of 31
Richard H. Brown
CEO and Chairman, Electronic Data Systems
5400 Legacy Drive
Suite H2-7W-40
Plano, TX 75024-3199
Citizenship: United States
M. Kathryn Eickhoff
President, Eickhoff Economics
Suite 400
510 LaGuardia Place
New York, NY 10012
Citizenship: United States
R.L. Berthold Lindqvist
President & CEO, Gambro AB
Magistratsvagen 16
S-220 10 Lund Sweden
Citizenship: Sweden
Bengt I. Samuelsson
Professor, Karolinska Institutet
Scheele Laboratory
Department of Medicine Biochemistry & Biophysics
Doktorsringen 9, A3
S-171 77 Stockholm, Sweden
Citizenship: Sweden
Frank C. Carlucci
Chairman, The Carlyle Group
Suite 220S
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Citizenship: United States
<PAGE>
CUSIP Number: 69329P103 Page 29 of 31
J. Soren Gyll - Chairman
Chairman of the Board of Directors, Pharmacia & Upjohn, Inc.
AB Volvo
Kungstradgarden
S-103 95 Stockholm Sweden
Citizenship: Sweden
William U. Parfet
Co-Chairman, MPI Research
54943 N. Main Street
Mattawan, MI 49071
Citizenship: United States
Ulla B. Reinius
President, Finansfakta R. AB
Sibyllegatam 5
S-I14 51 Stockholm Sweden
Citizenship: Sweden
Executive Officers:
- ------------------
Fred Hassan
President and CEO
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Goran A. Ando, M.D.
Executive Vice President and President, Research and Development
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: Sweden
Richard T. Collier
Senior Vice President and General Counsel
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
<PAGE>
CUSIP Number: 69329P103 Page 30 of 31
Timothy G. Rothwell
Executive Vice President and President, Pharmaceutical Operations
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Christopher J. Coughlin
Executive Vice President and Chief Financial Officer
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Robert G. Thompson
Senior Vice President and Chief Accounting Officer
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Hakan Astrom
Senior Vice President, Corporate Strategy and
Investor Relations
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: Sweden
Carrie Cox
Senior Vice President and
Head, Global Business Management
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
Paul Matson
Senior Vice President, Human Resources
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: United States
<PAGE>
CUSIP Number: 69329P103 Page 31 of 31
Mats Pettersson
Senior Vice President, Mergers & Acquisitions
95 Corporate Drive
Bridgewater, NJ 08807
Citizenship: Sweden
<PAGE>
List of Exhibits
----------------
Exhibit No. Exhibit Description
- ----------- -------------------
10.1 Stock Purchase Agreement, dated as of July 1, 1995, by
and between PDT, Inc. and Pharmacia S.p.A.
(incorporated by reference from Exhibit B to the report
on Schedule 13D, dated July 7, 1995, filed by P&U AB in
respect to the Shares)
10.2 PDT, Inc. $10,000,000 Common Stock and Warrants
Offering Investment Agreement, dated as of August 31,
1994, by and between PDT, Inc. and Pharmacia,
Inc.(incorporated by reference from Exhibit B to the
report on Schedule 13D, dated July 7, 1995, filed by
P&U S.p.A. in respect to the Shares)
10.3 PDT Warrant, dated as of August 31, 1994, granting
Pharmacia, Inc. a right to purchase up to 41,667
Shares (pre-split) of PDT, Inc. for the price of
$12.00 per share (pre-split)(incorporated by
reference from Exhibit C to the report on Schedule
13D, dated July 7, 1995, filed by P&U S.p.A. in
respect to the Shares)
10.4 Equity Investment Agreement, dated January 15, 1999,
between Miravant, P&U Inc. and P&U S.p.A.
10.5 Agreement and Amendment to the Equity Investment
Agreement, dated as of February 17, 1999, by and
between Miravant, P&U Inc. and P&U S.p.A.
10.6 Warrant Agreement, dated February 18, 1999, between
Miravant and P&U Treasury Services
10.7 Registration Rights Agreement, dated February 18, 1999,
between Miravant and P&U Treasury Services
10.8 Credit Agreement, dated February 18, 1999, between
Miravant and P&U Treasury Services (Confidential
treatment has been requested for certain information in
this document. Pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934, as amended, a complete copy
of this document has been filed with the Securities and
Exchange Commission.)
99.1 Joint Filing Agreement
EXHIBIT D
EQUITY INVESTMENT AGREEMENT
EQUITY INVESTMENT AGREEMENT (this "Agreement"), dated as of January 15,
1999, between Miravant Medical Technologies, a Delaware corporation (the
"Company"), Pharmacia & Upjohn, Inc., a Delaware corporation (the "Purchaser"),
and Pharmacia & Upjohn, S.p.A., an Italian corporation.
W I T N E S S E T H :
WHEREAS, the Company and Affiliates of the Purchaser are parties to the
Restated and Amended Development and License Agreement, dated June 8, 1998,
between Pharmacia & Upjohn S.p.A. and the Company (the "Oncology License
Agreement"), and the Amended and Restated Ophthalmology Development and License
Agreement, dated June 8, 1998, between Pharmacia & Upjohn AB and the Company
(the "Ophthalmology License Agreement" and, together with the Oncology License
Agreement, the "License Agreements"), and the parties desire to amend such
License Agreements in certain respects, as contemplated herein; and
WHEREAS, certain subsidiaries of the Purchaser are the record owners of
shares of Common Stock (as hereinafter defined), and the Purchaser wishes to
acquire additional shares of Common Stock, all on the terms and subject to the
conditions set forth in this Agreement.
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
Definitions
===========
Section 1.01. Terms Generally. The definitions ascribed to terms in
this Agreement apply equally to both the singular and plural forms of such
terms. Whenever the context may require, any pronoun shall be deemed to include
the corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be interpreted as if followed by the phrase
"without limitation". All references herein to the Preamble, Recitals, Articles,
Sections and Schedules shall be deemed references to the
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<PAGE>
Preamble and Recitals, Articles and Sections of, and Schedules to, this
Agreement unless the context shall otherwise require. The headings and captions
herein shall not be given effect in interpreting or construing the provisions of
this Agreement. Except as otherwise expressly provided herein, all references to
"dollars" or "$" shall be deemed references to the lawful money of the United
States of America.
Section 1.02. Definitions. The following terms have the meanings
ascribed to them below:
"Act" has the meaning assigned to such term in Section 6.03.
"Affiliate" means any other Person directly or indirectly controlling,
controlled by, or under common control with, that Person.
"Agreement" has the meaning assigned to such term in the preamble
hereto.
"Amending Agreement" has the meaning assigned to such term specified in
Section 7.01.
"Associate" has the meaning ascribed to such term in Rule 12b-2 under
the 1934 Act.
"Audited Financial Statements" has the meaning assigned to such term in
Section 4.10.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in The City of New York or in Los Angeles,
California, are authorized by law to close.
"Certificate of Incorporation" means the Restated Certificate of
Incorporation of the Company as in effect on the Closing Date.
"Closing" has the meaning assigned to such term in
Section 3.02.
"Closing Date" has the meaning assigned to such term in Section 3.02.
"Commission" means the Securities and Exchange Commission.
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<PAGE>
"Common Stock" means the common stock, $.01 par value, of the Company.
"Company" has the meaning assigned to such term in the Preamble.
"Control," "controlled by" or "under common control with" means direct
or indirect possession of the power to direct or cause the direction of
management or policies (whether through ownership of voting securities, by
contract or otherwise); provided that control shall be conclusively presumed
when any Person directly or indirectly owns a majority of the securities having
ordinary voting power for the election of a majority of the directors of a
corporation.
"Credit Agreement" has the meaning assigned to such term in Section
7.01.
"Disclosure Package" has the meaning assigned to such term in Section
4.09(a).
"Employee Benefit Plan" has the meaning assigned to such term in
Section 4.18.
"Environmental Law" has the meaning assigned to such term in Section
4.22.
"Environmental Property" has the meaning assigned to such term in
Section 4.22.
"FDA" has the meaning assigned to such term in Section 4.24.
"Hazardous Materials" has the meaning assigned to such term in Section
4.22.
"Intellectual Property Rights" has the meaning assigned to such term in
Section 4.14.
"License Agreements" has the meaning assigned to such term in the first
Recital.
"Licenses and Permits" means all governmental and private permits,
licenses, certificates of occupancy, franchises and authorizations required to
conduct the business of the Company and its Subsidiaries with operations and
products substantially the same as those of the Company
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<PAGE>
immediately prior to the consummation of the transaction contemplated hereby or
as now contemplated.
"Loss" means any loss, claim, damages, or liability.
"Oncology License Agreement" has the meaning assigned to such term in
the first Recital.
"Ophthalmology License Agreement" has the meaning assigned to such term
in the first Recital.
"Person" means and includes natural persons, corporations, limited
liability companies, limited partnerships, general partnerships, joint stock
companies, joint ventures, associations, companies, trusts or other
organizations, whether or not legal entities, and governments and agencies and
political subdivisions thereof.
"Product Intellectual Property" has the meaning assigned to such term
in Section 4.13.
"Purchase Price" has the meaning assigned to such term in Section 3.01.
"Purchaser" has the meaning assigned to such term in the Preamble.
"Registration Rights Agreement" has the meaning assigned to such term
in Section 7.01.
"Securities" has the meaning assigned to such term in Section 3.01.
"Security Agreement" has the meaning specified in Section 7.01.
"Subsidiary" means any corporation, association or other business
entity of which more than 50% of the total voting power or shares of stock
entitled to vote in the election of directors, managers or trustees thereof is
at the time owned or controlled, directly or indirectly, by the Company or one
or more of the other Subsidiaries of the Company or a combination thereof.
"Warrant Agreement" has the meaning assigned to such term in Section
7.01.
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<PAGE>
"1933 Act" means the Securities Act of 1933, as amended and as it may
be amended from time to time, including the rules and regulations thereunder.
"1934 Act" means the Securities Exchange Act of 1934, as amended and as
it may be amended from time to time, including the rules and regulations
thereunder.
ARTICLE II
Amendments to the License Agreements
Section 2.01. Amendment to the Oncology License Agreement. The Oncology
License Agreement is hereby amended ab initio, effective as of the Closing Date,
to delete therefrom Section 3.04 thereof in its entirety.
Section 2.02. Amendment to Ophthalmology License Agreement. When
executed and delivered as contemplated hereby, the Amending Agreement will amend
the Ophthalmology License Agreement in certain respects, all as set forth in the
Amending Agreement.
ARTICLE III
Equity Investment
Section 3.01. Issuance, Sale and Delivery of the Securities. The
Company hereby agrees, subject to the prior satisfaction or waiver in writing by
the Company of the conditions specified in Section 7.02, to issue and sell to
the Purchaser, and the Purchaser hereby agrees, subject to the prior
satisfaction or waiver in writing by the Purchaser of the conditions specified
in Section 7.01, to purchase from the Company, 1,136,533 shares of Common Stock
(the "Securities") for an aggregate purchase price equal to $19,000,000 (the
"Purchase Price").
Section 3.02. Closing. The consummation of the stock purchase
transaction contemplated by Section 3.01 shall take place at Sullivan &
Cromwell, 125 Broad Street, New York, New York 10004, at 10:00 a.m., New York
time, on the fifth day following the satisfaction or waiver by the Purchaser in
writing of the last to be satisfied or so waived of the conditions set forth in
Article VII, or at such other
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<PAGE>
location, date and time as may be agreed upon between the Purchaser and the
Company (such consummation being called the "Closing" and such date and time
being called the "Closing Date"). At the Closing, (a) the Company shall deliver,
issue and sell to the Purchaser a stock certificate or certificates in the name
of the Purchaser or any Affiliate of the Purchaser designated to the Company by
the Purchaser, representing the Securities, and (b) the Purchaser shall pay the
Purchase Price by wire transfer or certified or bank cashier's check in same day
funds.
ARTICLE IV
Representations and Warranties of the Company
The Company hereby makes the following representations and warranties
which shall survive the execution and delivery of this Agreement and the
issuance, delivery and sale of the Securities pursuant hereto:
Section 4.01. Organization and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and is duly qualified to do business in California.
Neither the Company nor any of its stockholders has adopted or taken any action
in contemplation of any plan of liquidation or dissolution of the Company. The
Company has provided the Purchaser with true, complete and correct copies of the
Certificate of Incorporation and Bylaws of the Company as in effect on the date
hereof.
Section 4.02. Corporate Power of the Company. The Company has the
requisite corporate power and authority to execute, deliver and carry out this
Agreement and all other instruments, documents and agreements contemplated or
required by the provisions of this Agreement to be executed, delivered or
carried out by the Company. The Company has all requisite corporate power and
authority under the laws of the jurisdiction of its incorporation to own and
operate its properties and to carry on its business as now conducted and as
presently proposed to be conducted. The Board of Directors and stockholders of
the Company have taken all necessary corporate action to approve this Agreement
and to authorize the execution, delivery and performance of this Agreement by
the Company, the issuance by the Company of the Securities and the consummation
of the transactions contemplated hereby.
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<PAGE>
This Agreement has been duly properly executed and delivered by the Company and
constitutes the legally valid and binding obligation of the Company enforceable
against it in accordance with its terms.
Section 4.03. No Conflict. Except as set forth in Schedule 4.03, none
of (a) the approval by the Board of Directors and stockholders of the Company of
this Agreement, (b) the execution or the delivery by the Company of this
Agreement or the performance by the Company of its obligations hereunder or the
consummation of the transactions contemplated hereby or (c) the issuance by the
Company of the Securities will (A) conflict with or result in any violation or
constitute a default under the Certificate of Incorporation or Bylaws of the
Company or any agreement, mortgage, indenture, franchise, license, permit,
authorization, lease or other instrument, or any judgment, decree, order, law or
regulation by which the Company or any of its properties or assets is bound, or
(B) result in the creation or imposition of any lien, security interest, charge,
encumbrance, restriction or claim of any nature upon, or give to others any
interest or right, including any right of termination or cancellation, in or
with respect to, or otherwise adversely affect, any property, asset or business
of the Company, or (C) require the Company to obtain or make any consent,
authorization, approval, registration, declaration or filing under any statute,
law, ordinance, regulation, rule, judgment, decree or order of any court or any
governmental agency, board, bureau, body, department or authority of any United
States or foreign jurisdiction, except those which have been completed at the
date of this Agreement, or (D) conflict with any other restriction of any kind
or character to which the Company is subject or to which any of its properties
is bound.
Section 4.04. Subsidiaries. The Company has three Subsidiaries,
Miravant Cardiovascular, Inc., a Delaware corporation, Miravant Pharmaceuticals,
Inc., a Delaware corporation, and Miravant Systems, Inc., a California
corporation. Each Subsidiary is duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and has all
corporate power and authority to carry on its business as now conducted and as
presently proposed to be conducted. All of the outstanding capital stock of the
Company's Subsidiaries is validly issued, fully paid and nonassessable and owned
by the Company free and clear of any lien, pledge or other encumbrance. Other
than the three Subsidiaries, the Company does not own any
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<PAGE>
securities or other ownership interests in any other Person which would entitle
the Company to control such Person.
Section 4.05. Capitalization.
(a) Authorized Shares. The authorized capital of the Company consists
of 50,000,000 shares of Common Stock and 20,000,000 shares of preferred stock,
of which 500,000 shares have been designated Series A Preferred Stock. The
Company holds no shares of its capital stock in its treasury. Except as set
forth in Schedule 4.05(a) and except as disclosed in the Disclosure Package, no
Person has any agreement, subscription, option or warrant or any other right or
commitment entitling such Person to acquire from the Company any shares of the
Company's capital stock or any other securities or other instruments convertible
into or exchangeable for any such shares.
(b) Outstanding Shares. At the Closing, no more than 17,200,000 shares
of capital stock of the Company will be issued and outstanding. All of the
Securities when issued, sold and delivered in accordance with the terms hereof
and for the consideration expressed herein, will have been duly authorized and
validly issued, fully paid and non-assessable and free of any liens or
encumbrances. The issuance of the Securities will not violate any preemptive or
other rights and will be in compliance with applicable federal and state
securities laws and regulations. The Company has no obligations or agreements
concerning the repurchase of any of the shares of its outstanding capital stock.
Section 4.06. Corporate Record Keeping. The corporate record and stock
transfer books of the Company and each of its Subsidiaries are complete,
accurate and up-to-date with all necessary signatures and set forth all meetings
and actions taken by the respective incorporators, stockholders and directors of
each such party.
Section 4.07. Compliance With Laws. The Company and each of its
Subsidiaries is in compliance in all material respects with all federal, state,
local and foreign statutes, laws, ordinances, regulations, rules, judgments,
orders and decrees applicable to it or its respective assets, properties,
business or operations.
Section 4.08. Licenses and Permits. The Company is not aware of any
fact which has not been disclosed to the
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Purchaser which could adversely affect the ability of the Company to obtain or
maintain the Licenses and Permits (or any consent required to be obtained with
respect thereto as a result of the transactions contemplated hereby) after
consummation of the transactions contemplated hereby on the same terms as such
Licenses and Permits were held by the Company immediately prior to the
consummation of the transactions contemplated hereby.
Section 4.09. Disclosure.
(a) The Company has delivered to the Purchaser copies of the filings
made by the Company with the Commission since December 31, 1995 and prior to the
date hereof and the press releases issued by the Company since September 30,
1998 and prior to the date hereof (such filings and press releases collectively,
the "Disclosure Package").
(b) To the Company's knowledge, none of such statements, forms or
reports (including, without limitation, any financial statements, exhibits and
schedules included therein and documents incorporated therein by reference), as
amended or supplemented, if applicable, at the time filed, declared effective or
mailed, as the case may be, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading.
(c) This Agreement and all of the Schedules delivered to the Purchaser
in connection herewith, when read together with the Disclosure Package, do not
contain any statement that is false or misleading with respect to any material
fact and do not omit to state a material fact necessary in order to make the
statements therein not false or misleading. There is no additional fact of which
the Company is aware that has not disclosed in writing to the Purchaser that in
the opinion or belief of the Company materially and adversely affects, or so far
as the Company can now reasonably foresee will materially and adversely affect,
the properties, business or condition (financial or otherwise) of the Company or
any Subsidiary.
Section 4.10. Financial Statements. The Company has furnished to the
Purchaser a true and complete copy of its audited consolidated balance sheet as
of December 31, 1997 and an audited consolidated statement of income and
retained earnings for the year then ended (the "Audited Financial
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Statements"). Except as disclosed in the Disclosure Package, the Audited
Financial Statements have been prepared in accordance with generally accepted
accounting principles on a basis consistent with prior periods and fairly
present the financial condition and results of operations and changes in the
financial condition of the Company and the Subsidiaries as of the dates thereof,
and for the periods indicated, subject to all normal adjustments. For purposes
of this Agreement, all references to "Audited Financial Statements" include any
notes to such statements.
Section 4.11. Litigation. There is no material suit, action,
arbitration or legal, administrative or other proceeding or pending
investigation to which the Company or any Subsidiary is a party or, to the
Company's knowledge, is threatened against the Company, or any of its
Subsidiaries or their businesses, assets or financial condition. Except as set
forth in Schedule 4.11, the Company has no knowledge of any governmental
investigation against the Company or its Subsidiaries, other than routine
government contract audits. To the best of the Company's knowledge, neither the
Company nor any of its Subsidiaries is in violation or infringement of any
intellectual property right, or registrations or applications therefor, of any
other person.
Section 4.12. Conflict of Interest. Except as disclosed in the
Disclosure Package, all purchasing transactions relating to the Company and its
Subsidiaries have been at market prices since inception. No officer or director
of the Company or any Affiliate of any such person has or within the last year
has had, either directly or indirectly:
(a) an equity or debt interest in any corporation, partnership, joint
venture, association, organization or other Person which furnishes or sells or
during such period furnished or sold services or products to the Company or the
Subsidiaries, or purchases or during such period purchased from the Company or
the Subsidiaries any goods or services, or otherwise does or during such period
did business with the Company or the Subsidiaries; or
(b) a beneficial interest in any contract, commitment or agreement to
which the Company or the Subsidiaries is or was a party or under which it was
obligated or bound or to which its properties may be or may have been subject,
other than stock options and other contracts, commitments or agreements between
the Company or the
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Subsidiaries and such persons in their capacities as employees, independent
contractors, officers or directors of the Company or the Subsidiaries.
Section 4.13. License Agreements and Product Intellectual Property. The
representations and warranties made by the Company in the License Agreements are
true and correct. The Company has no actual knowledge of any suit, claims or
proceedings pending or threatened with respect to the rights in the intellectual
property owned by or licensed to the Company (the "Product Intellectual
Property"). To the Company's knowledge, there are no commitments or contractual
obligations of which the Company is a party which would prohibit the Company
from entering into this Agreement or performing its obligations hereunder or
which would affect the Company's ability to amend with the Purchaser the
licenses for the Product Intellectual Property provided for in the License
Agreements.
Section 4.14. Intellectual Property Rights.
(a) To the Company's knowledge and except as disclosed in the
Disclosure Package: the Company and its Subsidiaries have good and marketable
title to and own their inventions, licenses, patents, trade secrets or other
proprietary know-how (the "Intellectual Property Rights") free and clear of all
mortgages, liens, loans and encumbrances, except such encumbrances and liens
which arise in the ordinary course of business and do not materially impair the
Company's or its Subsidiaries' ownership or use of the Intellectual Property
Rights or materially detract from the value thereof; no proceedings have been
instituted or are pending which challenge the Company's or its Subsidiaries'
rights to the Intellectual Property Rights or the validity thereof; all material
rights or inventions conceived by any employee or consultant of the Company or
its Subsidiaries during the scope of their services for the Company or its
Subsidiaries have been disclosed and effectively assigned to the Company or its
Subsidiaries; and with respect to the Intellectual Property Rights licensed by
the Company and its Subsidiaries, such licenses are in full force and effect,
the Company and its Subsidiaries are in compliance with the terms and provisions
thereof, and no event has occurred which, with notice or lapse of time or both,
would constitute a breach or violation thereof which could have a material
adverse effect on the financial condition, business or properties of the Company
and its Subsidiaries taken as a whole, and the Company and its
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Subsidiaries hold a valid license free of any liens, claims or encumbrances
which do not and will not, individually or in the aggregate, have a material
adverse effect on the financial condition, business or properties of the Company
and its Subsidiaries taken as a whole.
(b) To the Company's knowledge, the Company and its Subsidiaries have
the right and authority to use the Intellectual Property Rights in connection
with the conduct of the business of the Company and its Subsidiaries in the
manner and to the extent such business is presently conducted and as it is
proposed to be conducted, and the Company and its Subsidiaries have not been
notified of any claim that such use conflicts with, infringes upon or violates
any rights of any other Person, except to the extent that such conflict,
infringement or violation does not and will not, individually or in the
aggregate, have a material adverse effect.
Section 4.15. Material Contracts. Except as set forth on Schedule 4.15
and except as disclosed in the Disclosure Package, there are no material
agreements, undertakings, instruments, contracts or proposed transactions to
which the Company or any of the Subsidiaries is a party or by which it is bound
which involve an option, license or agreement of any kind with respect to the
Intellectual Property Rights of the Company or its Subsidiaries, or the
prohibition or limitation of the Company's or any of its Subsidiaries' ability
to engage in their respective businesses or any other business or to compete
with any Person.
Section 4.16. No Undisclosed Liabilities. Except as disclosed in the
Disclosure Package, there are no liabilities or obligations of any nature,
whether absolute, accrued, contingent or otherwise, and whether due or to become
due (including, without limitation, any liability for taxes and interest,
penalties and other charges payable with respect to any such liability or
obligations) which individually or in the aggregate are material to the
condition (financial or otherwise) of the Company, or prospects of the Company,
which are not disclosed in the Audited Financial Statements, or incurred in the
ordinary course of business subsequent to the latest of the Audited Financial
Statements.
Section 4.17. Changes. Except as disclosed in the Disclosure Package
and except as set forth in Schedule 4.17 or disclosed elsewhere in this
Agreement since December 31, 1997, except as filed with the Commission, there
has not been:
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(a) any material change in the assets, liabilities (contingent or
otherwise), obligations, condition (financial or otherwise) or operating results
of the Company or any of the Subsidiaries, except operating losses and changes
in the ordinary course of business from that reflected in the Audited Financial
Statements or subsequent financial statements filed with the Commission;
(b) any material waiver by the Company and its Subsidiaries of a
valuable right which is material to the Company's and its Subsidiaries' business
or of a material debt owed to it;
(c) any satisfaction or discharge of any lien, claim or encumbrance or
payment of any obligation by the Company and its Subsidiaries, except in the
ordinary course of business and which is not material to the assets, properties,
financial condition, operating results, prospects or business of the Company and
its Subsidiaries (as such business is presently conducted and as it is planned
to be conducted);
(d) any material change or amendment to a material contract or
arrangement by which the Company and its Subsidiaries or any of its assets or
properties is bound or subject; or
(e) any other material adverse change in the business or prospects of
the Company and its Subsidiaries (as such business is presently conducted or
planned to be conducted).
Section 4.18. Employee Benefit Plans. No prohibited transaction (as
defined under Section 4975 of the Internal Revenue Code of 1986, as amended) has
occurred. The Company has received a favorable determination of qualification
from the Internal Revenue Service for each employee benefit plan (as defined in
Section 3(3) of ERISA)("Employee Benefit Plan") in which employees of the
Company or the Subsidiaries participate. The financial statements of the Company
accurately reflect all liabilities owed by the Company to past and present
employees or their beneficiaries arising out of such employees' employment with
the Company pursuant to such Employee Benefit Plans. All amounts required under
the terms of any Employee Benefit Plan to have been paid or accrued as
contributions to such Employee Benefit Plan by the Company as of the last day of
the most
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recent fiscal year of such Plan ended on or before the date of this Agreement
have been paid or accrued.
Section 4.19. Employee Relations. The Company is not bound by or
subject to (and none of its assets or properties is bound by or subject to) any
written or oral, express or implied, contract, commitment or arrangement with
any labor union, and no labor union has requested or, to the knowledge of the
Company, sought to represent any of the employees, representatives or agents of
the Company or any of its Subsidiaries. There is no strike or other labor
dispute involving the Company or any of its Subsidiaries pending, or to the
knowledge of the Company threatened, which could have a material adverse effect
on the assets, properties, financial condition, prospects or business (as now
conducted or as proposed to be conducted) of the Company, nor is the Company
aware of any labor organization activity involving its or its Subsidiaries'
employees. The Company is not aware that any officer or key employee intends to
terminate his or her employment with the Company or any of its Subsidiaries, nor
does the Company intend to terminate the employment of any such person. The
Company believes its relations with its employees are satisfactory.
Section 4.20. Taxes. All required foreign, federal, state and local tax
returns, notices and reports of the Company and its Subsidiaries have been
accurately prepared and duly and timely filed, and all foreign, federal, state,
local and other taxes required to be paid with respect to the periods covered by
such returns have been paid, except such returns and taxes with respect to which
the failure to pay or file would not have a material adverse effect. The Company
has never had any tax deficiency proposed or assessed against it which would
have a material adverse effect, has not executed any waiver or extension of any
statute of limitations on the assessment or collection of any taxes which would
have a material adverse effect and none of the Company's federal or state tax
returns has ever been audited by governmental authorities. No tax audit, action,
suit, proceeding, investigation, examination or claim is now pending or, to the
Company's knowledge, threatened against the Company, and no issue or question
has been communicated to the Company (and is currently pending) by any taxing
authority in connection with any of the Company's tax returns or reports.
Section 4.21. Use of Proceeds. The proceeds of the sale of the
Securities to the Purchaser hereunder shall be
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used by the Company for working capital and other general corporate purposes.
Section 4.22. Environmental Matters. To the Company's best knowledge
after reasonable inquiry:
(a) all assets and property currently or previously owned, leased,
operated or used by the Company or any of the Subsidiaries in connection with
their businesses ("Environmental Property"), all current and previous conditions
on and uses of the Environmental Property and all current and previous ownership
and operations of the Environmental Property and the Company and the
Subsidiaries (including, without limitation, transportation and disposal of
Hazardous Materials by or for the Company or the Subsidiaries) comply, have at
all times complied, and will comply with, and do not cause, and have not caused,
liability to be incurred by the Company or the Subsidiaries under any current or
past federal or state law relating to the protection of health or the
environment, including, without limitation, the common law, including the law of
nuisance and strict liability ("Environmental Law") except where non-compliance
has had and will have no material adverse effect; and neither the Company nor
any of the Subsidiaries is in violation of and has not violated any
Environmental Law which violation has had or will have a material adverse
effect;
(b) the Company has properly obtained and is in compliance with all
necessary permits, registrations, approvals and licenses, and has properly made
all filings with and submissions to any government or other authority, required
by any Environmental Law the failure of which to obtain, comply with or make
would have a material adverse effect. No deficiencies have been asserted by any
such government or authority with respect to such items which deficiencies have
had or will have a material adverse effect; and
(c) there has been no spill, discharge, leak, leaching, emission,
migration, injection, disposal, escape, dumping or release of any kind on,
beneath, above or into the Environmental Property or into the environment
surrounding the Environmental Property of any (i) pollutants or contaminants,
other than automobile emissions, (ii) hazardous, toxic, infectious or
radioactive substances, chemicals, materials or wastes (including, without
limitation, those defined as hazardous under any Environmental Law), (iii)
petroleum including crude oil or any derivative or fraction thereof,
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(iv) asbestos fibers, other than contained in automobile brake linings or (v)
solid wastes ((i)-(v) collectively, "Hazardous Materials") which have had or
will have a material adverse effect.
Section 4.23. Registration Rights; Voting Trust Agreements. Except as
described in the Disclosure Package, the Company is not a party to any contract
or commitment which requires the Company to register (now or in the future,
whether contingent or not) under the 1933 Act any of its capital stock. The
Company is not a party to, nor aware of, any stockholder agreements, voting
trusts, proxies or other agreements or understandings with respect to the voting
of any of the capital stock of the Company.
Section 4.24. FDA Matters. Except as disclosed to the Purchaser in
writing, there are no applications or other proceedings presently pending before
the United States Food and Drug Administration (the "FDA"). The FDA has not
delivered a letter of non-approval or threatened to deliver such a letter with
respect to any product manufactured, marketed, licensed or developed by the
Company or any Subsidiary, or any product which the Company or its Subsidiaries
intend to manufacture, market, license or develop.
Section 4.25. Warranties and Representations. All of the foregoing
representations and warranties will survive for a period of one year from the
Closing Date.
ARTICLE V
Covenants
The Company covenants and agrees that so long as the Purchaser and its
Affiliates own more than 5% of the outstanding shares of Common Stock of the
Company, unless the Purchaser shall otherwise consent in writing, it will:
Section 5.01. Financial Information. Furnish or cause to be furnished
to the Purchaser the following financial statements and information, which shall
be prepared on a substantially consistent basis:
(a) As soon as available but in any event within 100 days after the
close of each fiscal year of the Company,
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audited consolidated balance sheets of the Company and of each of its
Subsidiaries as of the close of such fiscal year, and audited consolidated
statements of income, stockholders' equity and cash flow of the Company and each
of its Subsidiaries for such fiscal year, prepared in accordance with generally
accepted accounting principles, setting forth, in the case of each consolidated
balance sheet and consolidated statement, in comparative form, corresponding
figures for the preceding fiscal year, together with copies of the reports and
certificates relating thereto, including an opinion of Ernst & Young LLP or
other independent certified public accountants of recognized national standing
selected by the Company. The Company and the Purchaser agree that so long as the
Company is subject to the reporting obligations of Section 13 of the 1934 Act
pursuant to Section 12(b) or 12(g) of the 1934 Act, the Company's Annual Report
on Form 10-K shall satisfy the requirements of this Section 5.01(a).
(b) As soon as available but in any event within 60 days after the end
of each fiscal quarter of the Company (i) a consolidated balance sheet of the
Company and its Subsidiaries as of the last day of such fiscal quarter and
consolidated statements of income and cash flow of the Company and each of its
Subsidiaries for such quarter and for the period from the beginning of the then
current fiscal year to the end of such quarter, setting forth in comparative
form corresponding figures for the same quarter and period in the preceding
fiscal year and for the same quarter and period in the current year and (ii) a
consolidating balance sheet for the Company and each of its Subsidiaries as of
the close of such quarter and consolidating statements of earnings and cash flow
for the Company and each of its Subsidiaries for such quarter and for the period
from the beginning of the then current fiscal year to the end of such quarter,
each balance sheet and statement of earnings and cash flow referred to in this
Section to be certified by the principal financial officer of the Company,
provided that any such certificate may state that the accompanying balance sheet
and statements are subject to normal year-end adjustments based on year-end
audit. The Company and the Purchaser agree that so long as the Company is
subject to the reporting obligations of Section 13 of the 1934 Act pursuant to
Section 12(b) or 12(g) of the 1934 Act, the Company's Quarterly Report on Form
10-Q shall satisfy the requirements of this Section 5.01(b).
(c) From time to time, with reasonable promptness, such additional
financial statements and information with
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respect to the financial condition of the Company and of its Subsidiaries as the
Purchaser may reasonably request, including, without limitation and without
further request, any financial statements or reports (including comment letters
to management) furnished to the Company or any Subsidiary by its independent
certified public accountants, any and all registration statements, proxy
statements and periodic reports filed by the Company or any Subsidiary with the
Commission pursuant to the 1933 Act or the 1934 Act, and all material press
releases issued by or on behalf of the Company or any Subsidiary.
Section 5.02. Access to Information. Provide such information
concerning the operations of the Company and its Subsidiaries as the Purchaser
may from time to time reasonably request in writing, and upon reasonable advance
notice permit representatives of the Purchaser full and free access during
normal business hours to the properties, books and records of the Company and
its Subsidiaries; provided that the Company shall not be required to disclose
any confidential information or information held as a trade secret, and to
discuss the affairs, accounts and finances of the Company or any of its
Subsidiaries with the financial and management personnel of the Company and its
Subsidiaries and with their independent certified public accountants.
Section 5.03. Board of Directors' Meetings. The Purchaser shall receive
notices of any and all Board of Directors' meetings in accordance with the
Bylaws of the Company and shall be entitled to attend, as an observer, all such
Board of Directors' meetings. In addition, the Company will provide the
Purchaser with copies of any written consents of the Board of Directors at the
time they are signed by the Board of Directors.
Section 5.04. Rule 144. The Company agrees to make and keep public
information regarding the Company available as those terms are understood and
defined in Rule 144 promulgated under the 1933 Act, at all times following the
date of the Company's initial public offering, and to file with the Commission
in a timely manner all reports and other documents required of the Company under
the 1933 Act and the 1934 Act, at any time that it is subject to such reporting
requirements.
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ARTICLE VI
Representations, Warranties and Covenants of the Purchaser;
Transfer of Securities
Section 6.01. Representations of the Purchaser. The Purchaser hereby
represents and warrants to the Company as follows:
(a) The Purchaser is a corporation organized under the laws of Delaware
having its principal place of business in Bridgewater, New Jersey.
(b) The Purchaser has the requisite corporate power and authority to
execute, deliver and carry out this Agreement and all other instruments,
documents and agreements contemplated or required by the provisions of this
Agreement to be executed, delivered or carried out by the Purchaser. This
Agreement constitutes the legally valid and binding obligation of the Purchaser
enforceable against the Purchaser in accordance with its terms.
(c) The Purchaser is an "accredited investor" within the meaning of
Regulation D under the 1933 Act, and is acquiring the Securities for investment
for its own account, and not with a view to distribution subject, nevertheless,
to any requirement of law that the disposition of its property shall at all
times be within its control. The Purchaser has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of purchasing the Securities. The Purchaser is aware that it may be
required to bear the economic risk of an investment in the Securities for an
indefinite period, and it is able to bear such risk for an indefinite period.
The Purchaser acknowledges (a) that the Securities being acquired by it are not
being registered under the 1933 Act on the grounds that the issuance of such
securities is exempt from registration under Section 4(2) of the 1933 Act as not
involving any public offering, and (b) that the Company's reliance on such
exemption is predicated in part on the representations made to the Company by
the Purchaser in this Section 6.01.
Section 6.02. Transfer of Securities. The Purchaser will not sell,
assign or transfer all or any part of the Securities acquired by it except as
follows:
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(a) The Securities or any part thereof or interest therein may be
assigned or transferred to an Affiliate of the Purchaser for its own account or
in connection with a sale of the Purchaser or its portfolio assets; provided
that such assignment or transfer is made in compliance with applicable
securities laws.
(b) The Securities or any part thereof or interest therein may be
assigned or transferred if such transfer is determined by the Purchaser and its
counsel, which may be in-house counsel to the Purchaser, to be necessary in
order to comply with applicable laws, rules or regulations; provided that such
assignment or transfer is made in compliance with applicable securities laws.
(c) The Securities or any part thereof or interest therein may be
assigned or transferred to any other Person or Persons; provided that the
Purchaser shall have furnished to the Company, if reasonably requested to do so,
either (i) an opinion, reasonably satisfactory to counsel for the Company, of
counsel skilled in securities matters (selected by the Purchaser and reasonably
satisfactory to the Company, it being understood and agreed that Sullivan &
Cromwell is and will be reasonably satisfactory to the Company) to the effect
that the proposed sale or transfer may be made without registration under the
1933 Act, or (ii) an interpretive letter from the Commission to the effect that
no enforcement action will be recommended if the proposed sale or transfer is
made without registration under the 1933 Act, in either case accompanied by
evidence reasonably satisfactory to the Company that such transfer will be in
compliance with applicable state securities ("blue sky") laws; provided,
however, that the foregoing proviso shall not apply with respect to any transfer
pursuant to an effective registration statement under the 1933 Act.
Upon the assignment or transfer by the Purchaser of all or any part of
the Securities or its interest therein pursuant to paragraphs (a), (b) or (c)
above, the term "the Purchaser", as used herein, shall thereafter include, to
the extent of the interest so assigned or transferred, the assignee or
transferee of such interest provided, however, that the foregoing shall not
apply with respect to any transfer pursuant to an effective registration
statement under the 1933 Act.
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Section 6.03. Private Placement; Legends. The Purchaser acknowledges
and agrees that the Securities have not been registered under the 1933 Act and
may not be offered or sold in the United States or to U.S. persons (as defined
in Regulation S) unless the Securities are registered under the 1933 Act, or an
exemption from the registration requirements of the 1933 Act is available. Each
certificate evidencing any Securities shall bear a legend in substantially the
following form:
The securities represented by this certificate are subject to
an Equity Investment Agreement, dated January 15, 1999, a
copy of which is on file at the principal office of the
Company and will be furnished to the holder on request to the
Secretary of the Company. Such Equity Investment Agreement
provides, among other things, for certain restrictions on
sale, transfer, pledge, hypothecation or other disposition of
the securities evidenced by this certificate.
In addition, unless counsel to the Company shall have advised the Company
that such legend is no longer needed, each certificate evidencing the Securities
shall bear a legend in substantially the following form:
The securities represented by this certificate have not been
registered pursuant to the Securities Act of 1933, as amended
(the "Act"), or any state securities law, and such securities
may not be sold, transferred or otherwise disposed of unless
the same are registered and qualified in accordance with the
Act and any applicable state securities laws, or in the
opinion of counsel reasonably satisfactory to the Company
such registration and qualification are not required.
The Purchaser shall have the right to request that the Company remove such
legends if the conditions of Rule 144 of the 1933 Act have been satisfied with
respect to the Securities evidenced by such certificate, or if such Securities
are otherwise registered in accordance with the 1933 Act or another exemption
from such registration is available, and the Company shall fully cooperate with
the Purchaser if any of the foregoing conditions are satisfied; provided in each
case other than registration under the 1933 Act that the Purchaser shall have
furnished to the Company, if
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reasonably requested to do so, an opinion or interpretive letter and such other
evidence as is referenced in Section 6.02(c) for a transfer of such Securities.
ARTICLE VII
Conditions to Closing
Section 7.01. Conditions to the Purchaser's Obligations. The obligation
of the Purchaser to purchase the Securities is subject to the prior satisfaction
or waiver in writing by the Purchaser of all of the following conditions:
(a) The representations and warranties of the Company contained in
Article IV shall be true in all material respects as of the Closing Date as
though made at and as of the Closing Date.
(b) The Company shall have performed, in all material respects, all
covenants, agreements and obligations required to be performed by it on or prior
to the Closing Date pursuant to this Agreement.
(c) A Credit Agreement in the form attached hereto as Exhibit A (the
"Credit Agreement"), a Warrant Agreement in the form attached hereto as Exhibit
B (the "Warrant Agreement"), a Security Agreement in the form attached hereto as
Exhibit C (the "Security Agreement"), a Registration Rights Agreement in the
form attached hereto as Exhibit D (the "Registration Rights Agreement") and an
Amended and Restated Ophthalmology Development & License Agreement in the form
attached hereto as Exhibit E (the "Amending Agreement") shall have been duly
executed and delivered by the parties thereto.
(d) The Purchaser shall have received the opinion of Nida & Maloney PC
in the form attached hereto as Exhibit F.
(e) On or prior to the Closing Date, the Company shall tender to the
Purchaser certificate(s) representing the Securities.
(f) The Company and the Purchaser shall have obtained all necessary
authorizations, consents or approvals or other orders or actions necessary or
appropriate for the consummation of the transactions contemplated by this
Agreement, and the Company and the Purchaser shall have made all necessary
filings with any court, administrative agency, or other governmental or
regulatory
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body or authority required for the execution and delivery by the Company and
the Purchaser of this Agreement or the Company's and the Purchaser's
consummation of the transactions contemplated hereby.
(g) No action, suit, proceeding or investigation by or before any
court, administrative agency or other governmental authority shall have been
instituted or threatened which may restrain, prohibit or invalidate any of the
transactions contemplated by this Agreement.
(h) The waiting period (including any extension thereof) applicable to
the Purchaser's acquisition of the Securities pursuant to this Agreement under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, shall have
expired or been terminated, and the Purchaser shall have received evidence
thereof satisfactory to the Purchaser.
Section 7.02. Conditions to the Company's Obligations. The obligation
of the Company to issue, deliver and sell the Securities is subject to the prior
satisfaction or waiver in writing by the Company of all of the following
conditions:
(a) The representations and warranties of the Purchaser contained in
Section 6.01 shall be true in all material respects as of the Closing Date as
though made at and as of the Closing Date.
(b) The Purchaser shall have performed, in all material respects, all
covenants, agreements and obligations required to be performed by it on or prior
to the Closing Date pursuant to this Agreement.
(c) The Credit Agreement, Warrant Agreement, Security Agreement,
Registration Rights Agreement and Amending Agreement shall have been duly
executed and delivered by the parties thereto.
(d) On the Closing Date, the Purchaser shall tender to the Company the
Purchase Price.
(e) The Company and the Purchaser shall have obtained all necessary
authorizations, consents or approvals or other orders or actions necessary or
appropriate for the consummation of the transactions contemplated by this
Agreement, and the Company and the Purchaser shall have made all necessary
filings with any court, administrative agency, or other governmental or
regulatory
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body or authority required for the execution and delivery by the Company and the
Purchaser of this Agreement or the Company's and the Purchaser's consummation of
the transactions contemplated hereby.
(f) No action, suit, proceeding or investigation by or before any
court, administrative agency or other governmental authority shall have been
instituted or threatened which may restrain, prohibit or invalidate any of the
transactions contemplated by this Agreement.
(g) The waiting period (including any extension thereof) applicable to
the Purchaser's acquisition of the Securities pursuant to this Agreement under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, shall have
expired or been terminated, and the Company shall have received evidence thereof
satisfactory to the Company.
ARTICLE VIII
Indemnity
Section 8.01. General. The Company shall indemnify, defend and save
harmless the Purchaser from, against, for and in respect of any Loss which
arises out of or relates to (i) a state of facts as a result of which any
representation made by the Company in Article IV hereof or in any document
delivered pursuant to this Agreement is untrue, inaccurate or misleading in any
respect as of the date hereof, or (ii) the breach of any warranty made by the
Company in Article IV hereof, or (iii) the failure of the Company to comply
with, perform or observe any other term, provision or condition contained in
this Agreement or in any document delivered pursuant to this Agreement; and any
reasonable expenses incurred in connection with investigating, defending or
asserting any claim, action, suit or proceeding incident to any matter
indemnified against hereunder, including, without limitation, court filing fees,
court costs, arbitration fees or costs, witness fees, and fees and disbursements
of legal counsel, investigators, expert witnesses, accountants and other
professionals in connection therewith.
Section 8.02. Cooperation. Each of the parties hereto agrees to render
to the other parties such assistance as they may reasonably require and to
cooperate in good faith with the other parties in order to ensure the proper and
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<PAGE>
adequate defense of any claim, action, suit or proceeding brought by any third
party.
Section 8.03. Remedies Cumulative. The remedies of the parties provided
for in this Article VIII shall be cumulative, shall not preclude the assertion
by any party of any other rights such party may have under this Agreement,
applicable law or otherwise (including rescission) and shall survive redemption
or repurchase of the Securities.
ARTICLE IX
Effectiveness of Agreement
Section 9.01. General. Except as otherwise provided herein, the
provisions of this Agreement shall continue in full force and effect for the
benefit of the holders of the Securities so long as any shares of the Securities
are held by the Purchaser or its Affiliates. The representations and warranties
made herein or in connection herewith shall survive the issuance, delivery and
sale of the Securities.
ARTICLE X
Lockup and Standstill Agreements
Section 10.01. Lockup. Prior to the 180th calendar day following the
Closing Date, the Purchaser shall not, and shall cause its Affiliates not to,
sell, assign, transfer or otherwise dispose of any of the Securities, except
that the Purchaser may transfer any of the Securities to any of its wholly owned
subsidiaries.
Section 10.02. Standstill.
(a) The Stock Purchase Agreement, dated as of July 1, 1995, between the
Company and Pharmacia & Upjohn S.p.A. is hereby amended ab initio, effective as
of the date thereof, to delete therefrom Section 5.5 thereof in its entirety.
(b) Prior to the earliest of (i) the occurrence of an Event of Default
(as defined in the Credit Agreement), (ii) the commencement of a tender offer by
any Person, other than Pharmacia & Upjohn, Inc. or any of its wholly owned
subsidiaries,
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<PAGE>
for shares of Common Stock, and (iii) July 1, 2000, unless specifically
requested in advance by the Company's Board of Directors, neither the Purchaser
nor any of the Purchasers' Affiliates will, and the Purchaser and its Affiliates
will not assist or encourage others (including by providing financing) to,
directly or indirectly, acquire or agree, offer, seek or propose to acquire
ownership of any securities issued by the Company (including but not limited to
beneficial ownership (as defined in Rule 13d-3 under the 1934 Act)) or enter
into any discussions, negotiations, arrangements or understandings with any
Person with respect to any of the foregoing; provided that this Section 10.02(b)
shall not prohibit (i) the acquisition by the Purchaser and its Affiliates of a
number of shares of Common Stock which, taken together with the number of shares
of Common Stock held by the Purchaser and its Affiliates as of the date of such
acquisition, does not exceed 25% of the aggregate number of outstanding shares
of Common Stock as of the date of this acquisition, (ii) the acquisition by the
Purchaser or its Affiliates of shares of Common Stock pursuant to Section 2.03
of the Credit Agreement or upon exercise of any Warrants (as defined in the
Credit Agreement), or (iii) the acquisition by the Purchaser or its Affiliates
of promissory notes pursuant to the Credit Agreement or any other securities
pursuant to the Credit Documents (as defined in the Credit Agreement).
ARTICLE XI
Miscellaneous
SECTION 11.01. APPLICABLE LAW. THIS AGREEMENT AND ALL RIGHTS ARISING
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE.
SECTION 11.02. WAIVER OF JURY. THE COMPANY AND THE PURCHASER EACH
HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT AND ANY RIGHT
ARISING HEREUNDER.
Section 11.03. Jurisdiction and Venue; Service of Process. (a) The
Company and the Purchaser each hereby
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<PAGE>
irrevocably submits to the non-exclusive jurisdiction of any state or federal
court in the Borough of Manhattan, The City of New York for the purpose of any
suit, action, proceeding or judgment relating to or arising out of this
Agreement and any right arising hereunder, and to the laying of venue in the
Borough of Manhattan, The City of New York. The Company and the Purchaser each
hereby irrevocably waives, to the fullest extent permitted by applicable law,
any objection to the laying of the venue of any such suit, action or proceeding
brought in the aforesaid courts and hereby irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an
inconvenient forum.
(b) The Company agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
Company at its address set forth in Section 11.06 or at such other address of
which the Purchaser shall have been notified pursuant thereto. The Company
further agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction.
(c) Each of the Company and the Purchaser waives, to the maximum extent
not prohibited by law, any right it may have to claim or recover in any legal
action or proceeding referred to in this Section 11.03 any special, exemplary,
punitive or consequential damages.
Section 11.04. Amendments and Waivers.
(a) Any provision of this Agreement may be amended, modified,
supplemented or waived, but only by a written amendment or supplement, or
written waiver, signed by the Company and the Purchaser.
(b) Except to the extent expressly set forth therein, any waiver shall
be effective only in the specific instance and for the specific purpose for
which such waiver is given.
Section 11.05. Cumulative Rights; No Waiver. Each and every right
granted to the Purchaser or allowed the Purchaser by law or equity, shall be
cumulative and not exclusive and may be exercised from time to time. No failure
on the part of the Purchaser to exercise, and no delay in
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<PAGE>
exercising, any right will operate as a waiver thereof, nor will any single or
partial exercise by the Purchaser of any right preclude any other or future
exercise thereof or the exercise of any other right.
Section 11.06. Notices. Any communication, demand or notice to be given
hereunder will be duly given when delivered in writing or by telecopy to a party
at its address as indicated below or such other address as such party may
specify in a notice to each other party hereto. A communication, demand or
notice given pursuant to this Section 11.06 shall be addressed:
If to the Company, to
Miravant Medical Technologies
7408 Hollister Avenue
Santa Barbara, California 93117
Telecopy: (805) 685-6038
Attention: Gary S. Kledzik
with a copy (which, in and of itself, shall not
constitute notice) to
Nida & Maloney PC
800 Anacapa Street
Santa Barbara, California 93101
Telecopy: (805) 568-1955
Attention: Joseph E. Nida
and
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304
Telecopy: (650) 493-6811
Attention: John T. Sheridan
If to the Purchaser, to
Pharmacia & Upjohn, Inc.
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<PAGE>
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 470-8047
Attention: Treasurer
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4485
Attention: Senior Vice President
of Business Development
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4489
Attention: General Counsel
with a copy (which, in and of itself, shall not
constitute notice) to
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Telecopy: (212) 558-3588
Attention: Neil T. Anderson,
Matthew G. Hurd
and Martin J. Travers
(b) Unless otherwise provided to the contrary herein, any notice which
is required to be given in writing pursuant to the terms of this Agreement may
be given by telecopy.
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<PAGE>
Section 11.07. Separability. In case any one or more of the provisions
contained in this Agreement shall be invalid, illegal or unenforceable in any
respect under any law, the validity, legality and enforceability of the
remaining provisions contained in this Agreement shall not in any way be
affected or impaired thereby.
Section 11.08. Persons Benefitting. This Agreement shall be binding
upon and inure to the benefit of the Purchaser and the Company, and their
respective successors, assigns, beneficiaries, executors and administrators.
Nothing in this Agreement is intended or shall be construed to confer upon any
Person, other than the Company and the Purchaser (and such successors, assigns,
beneficiaries, executors and administrators), any right, remedy or claim under
or by reason of this Agreement or any part hereof. This Agreement may not be
assigned without the written consent of the parties hereto, and any purported
assignment made in violation of this provision shall be null and void. The
provisions of the previous sentence notwithstanding, the Purchaser may assign
its rights and obligations under this Agreement to any of its wholly owned
Subsidiaries without the consent of any other party to this Agreement.
Section 11.09. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together constitute one and the same instrument.
Section 11.10. Headings. The descriptive headings of the several
Sections of this Agreement are inserted for convenience and shall not control or
affect the meaning or construction of any of the provisions hereof.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the date first above written.
MIRAVANT MEDICAL TECHNOLOGIES
By: /s/ Gary S. Kledzik
--------------------------------
Title: Chief Executive Officer
PHARMACIA & UPJOHN, INC.
By: /s/ Mats Pettersson
--------------------------------
Title: Senior Vice President
PHARMACIA & UPJOHN, S.p.A.
By: /s/ Mats Pettersson
--------------------------------
Title: Attorney-In-Fact
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EXHIBIT E
AGREEMENT AND AMENDMENT TO
THE EQUITY INVESTMENT AGREEMENT
AGREEMENT AND AMENDMENT, dated as of February 17, 1999 (the
"Agreement"), to the Equity Investment Agreement, dated as of January 15, 1999,
by and between Miravant Medical Technologies, a Delaware Corporation (the
"Company"), Pharmacia & Upjohn, Inc., a Delaware corporation ("P&U Inc.") and
Pharmacia & Upjohn S.p.A., an Italian corporation ("P&U S.p.A." and together
with P&U Inc., "P&U") (the "Equity Investment Agreement").
WHEREAS, P&U wishes to make P&U S.p.A. the Purchaser of any securities
to be received by P&U pursuant to the Equity Investment Agreement; and
WHEREAS, each party to the Equity Investment Agreement desires to amend
the Equity Investment Agreement in the manner set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
Section 1. Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Equity Investment Agreement.
Section 2. The Equity Investment Agreement is hereby amended, effective
as of the date hereof, as follows:
(i) The definition of the term "Purchaser" is hereby amended to read
in its entirety as follows:
"Purchaser" shall mean Pharmacia & Upjohn S.p.A.
(ii) The last sentence of Section 4.13 is hereby amended to read in
its entirety as follows:
To the Company's knowledge, there are no commitments or contractual
obligations of which the Company is a party which would prohibit the
Company from entering into this Agreement or performing its obligations
hereunder or which would affect the Company's ability to amend with the
Purchaser or its Affiliates the licenses for
<PAGE>
the Product Intellectual Property provided for in the
License Agreements.
(iii) Section 6.01(a) is hereby amended to read in its entirety as
follows:
(a) The Purchaser is a corporation organized under the laws of
Italy having its principal place of business in Milan, Italy.
(iv) Section 10.01 is amended to read in its entirety as follows:
Section 10.01 Lockup. Prior to the 180th calendar day following
the Closing Date, the Purchaser shall not, and Pharmacia & Upjohn, Inc.
shall not and shall not cause its Affiliates to, sell, assign, transfer
or otherwise dispose of any of the Securities, except that the
Purchaser may transfer any of the Securities to any wholly owned
subsidiary of Pharmacia & Upjohn, Inc.
(v) Section 11.06 is hereby amended to add the following to addresses
to which notices to the Purchaser must be directed:
Pharmacia & Upjohn S.p.A.,
via Robert Koch 1.2,
75017 Milan, Italy
Telecopy: 39 2 48381 2988
Attention: Legal Counsel
(vi) The last sentence of Section 11.08 is amended to read in its
entirety as follows:
The provisions of the previous sentence notwithstanding, the Purchaser
may assign its rights and obligations under this Agreement to any
wholly owned Subsidiary of Pharmacia & Upjohn, Inc. without the consent
of any other party to this Agreement.
Section 5. This Agreement may be executed in two or more counterparts,
each of which shall constitute an original and all of which, when taken
together, shall constitute one Agreement.
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<PAGE>
Section 6. This Agreement shall be effective as of the date hereof and,
except as set forth herein, the Equity Investment Agreement shall remain in full
force and effect and be otherwise unaffected hereby.
Section 7. Each party to this Agreement agrees to execute, acknowledge,
deliver, file and record such further certificates, amendments, instruments and
documents, and to do all such other acts and things, as may be required by law
or as may be necessary or advisable to carry out the intent and purpose of this
Agreement.
Section 8. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS
THEREOF.
Section 9. THE COMPANY AND THE PURCHASER EACH HEREBY WAIVES TRIAL BY
JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH THIS AGREEMENT AND ANY RIGHT ARISING HEREUNDER.
Section 10. Every provision of this Agreement is intended to be
severable. The invalidity and unenforceability of any particular provision of
this Agreement in any jurisdiction shall not affect the other provisions hereof,
and this Agreement shall be construed in all respects as if such invalid or
unenforceable provision were omitted.
Section 11. This Agreement shall be binding upon the parties hereto and
their respective successors, executors, administrators, legal representatives,
heirs and legal assigns and shall inure to the benefit of the parties hereto
and, except as otherwise provided herein, their respective successors,
executors, administrators, legal representatives, heirs and legal assigns. No
person other than the parties hereto and their respective successors, executors,
administrators, legal representatives, heirs and legal assigns, shall have any
rights or claims under this Agreement.
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<PAGE>
In witness whereof, the undersigned have signed this Agreement as of
the date first above written.
MIRAVANT MEDICAL TECHNOLOGIES
By: /s/ Gary S. Kledzik
----------------------------------
Title: Chief Executive Officer
PHARMACIA & UPJOHN, INC.
By: /s/ Mats Pettersson
----------------------------------
Title: Senior Vice President
PHARMACIA & UPJOHN S.p.A.
By: /s/ Mats Pettersson
----------------------------------
Title: Attorney-In-Fact
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EXHIBIT F
WARRANT AGREEMENT
WARRANT AGREEMENT (this "Agreement"), dated as of February 18, 1999,
between MIRAVANT MEDICAL TECHNOLOGIES, a Delaware corporation (the "Company"),
and PHARMACIA & UPJOHN TREASURY SERVICES AB, a Swedish corporation (the "Initial
Holder").
W I T N E S S E T H :
WHEREAS, Sections 2.02 and 6.02(c) of the Credit Agreement, of even
date herewith, between the Company and Pharmacia & Upjohn Treasury Services AB
(the "Credit Agreement") provide that in connection with the making of each
Borrowing Request contemplated thereby, the Company shall deliver to the Initial
Holder a Warrant Certificate representing a number of Warrants equal to the
Warrant Number and having the terms herein set forth;
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
Definitions
Section 1.01. Terms Generally. The definitions ascribed to terms in
this Agreement apply equally to both the singular and plural forms of such
terms. Whenever the context may require, any pronoun shall be deemed to include
the corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be interpreted as if followed by the phrase
"without limitation". All references herein to the Preamble, Recitals, Articles,
Sections and Exhibits shall be deemed references to the Preamble and Recitals,
Articles and Sections of, and Exhibits to, this Agreement unless the context
shall otherwise require. The headings and captions herein shall not be given
effect in interpreting or construing the provisions of this Agreement. Except as
otherwise expressly provided herein, all references to "dollars" or "$" shall be
deemed references to the lawful money of the United States of America.
Section 1.02. Definitions. The following terms have the meanings
ascribed to them below:
<PAGE>
"Affiliate" of any Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For purposes of this definition, "control" when used with respect
to any Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Average Price" means, with respect to the Exercise Price for any
Warrant, the average of the Closing Prices of the Common Stock for the 10
Trading Days immediately preceding the date of the dispatch to the Initial
Holder of the Borrowing Request that accompanies the Warrant Certificate
evidencing such Warrant.
"Board of Directors" means the board of directors of the Company.
"Borrowing Request" has the meaning assigned to such term in the Credit
Agreement.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in The City of New York or in Los Angeles,
California are authorized by law to close.
"Cash Amount" means, with respect to any Warrant, an amount of cash
equal to the product of (i) 95% of the Closing Price of the Common Stock as of
the date of exercise of such Warrant multiplied by (ii) the Shares Amount in
effect on such date.
"Close of Business" means, for any day, 5:00 p.m., New York City time,
on such date.
"Closing Price" means the last reported sale price regular way on the
day in question or, in case no such sale takes place on such day, the reported
closing bid price regular way of the Common Stock, in each case on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading, or, if not listed or admitted to trading on any national securities
exchange, the closing bid price of the Common Stock on the Nasdaq National
Market, or if not listed or admitted to trading on any national securities
exchange and not quoted on the Nasdaq National
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<PAGE>
Market, the closing bid price of the Common Stock in the over-the-counter market
on the day in question as reported by the National Quotation Bureau
Incorporated, or a similarly generally accepted reporting service, or, if not so
available in such manner, as furnished by any New York Stock Exchange, Inc.
member firm selected from time to time by the Board of Directors for such
purpose. In the case of a closing price of Common Stock on the Nasdaq National
Market System, such price shall mean the closing price reported in the New York
City edition of The Wall Street Journal or, if not so reported, another
authoritative source.
"Commission" means the Securities and Exchange Commission (or any
successor Governmental Authority).
"Common Stock" means the common stock, par value $.01 per share, of the
Company and any other stock of the Company into which such common stock may be
converted or reclassified (other than stock of the Company into which unissued
Common Stock has been reclassified) or that may be issued in respect of, in
exchange for, or in substitution of, such common stock by reason of any stock
splits, stock dividends, distributions, mergers, consolidations,
recapitalizations or other like events.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exercise Price" means, with respect to any Warrant, the price equal to
140% of the Average Price.
"Expiration Date" means, with respect to each Warrant, the fifth
anniversary of the date on which a Warrant Certificate evidencing such Warrant
is first received by the Initial Holder, provided that if such anniversary is
not a Business Day, the next Business Day thereafter.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Holder" means any holder from time to time of Warrant Certificates.
"Person" means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated
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<PAGE>
organization, association, corporation, institution, public benefit corporation,
entity or government (whether Federal, state, county, city, municipal or
otherwise, including any instrumentality, division, agency, body or department
thereof).
"Quarterly Loan" has the meaning assigned to such term in the Credit
Agreement.
"SEC Reports" means the annual and quarterly reports and the
information, documents, and other reports that the Company is required to file
with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act.
"Securities Act" means the Securities Act of 1933, as amended.
"Shares Amount" means, with respect to any Warrant, one share of Common
Stock, subject to all adjustments made pursuant to Article V hereof on or prior
to the date of exercise of such Warrant.
"Trading Day" means a day on which the principal national securities
exchange on which the shares of Common Stock are listed or admitted to trading
is open for the transaction of business or, if the shares of Common Stock are
not listed or admitted to trading on any national securities exchange, a day on
which the Nasdaq National Market is open for the transaction of business.
"Warrant" means a warrant to purchase Common Stock at a price per share
of Common Stock equal to the Exercise Price for such Warrant.
"Warrant Number" has the meaning assigned to such term in the Credit
Agreement.
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<PAGE>
Section 1.03. Tie Sheet. The following terms are defined in the
Sections set forth below:
Term Section
---- -------
Agreement Preamble
Applicable Price 5.06
Call Notice 3.07(b)
Called Warrants 3.07(a)
Common Stock Fundamental Change 5.06
Company Preamble
Credit Agreement Recitals
Current Event 5.01(g)
Expiration Time 5.01(f)
Indemnitee 9.02
Initial Holder Preamble
Non-Stock Fundamental Change 5.06
Other Event 5.01(g)
Purchased Shares 5.01(f)
Purchaser Stock Price 5.06
Reference Date 5.01(d)
Registrar 2.04(a)
Transfer Agent 7.01
Trigger Date 3.07(a)
Warrant Certificates 2.02
Warrant Register 2.04(a)
ARTICLE II
Issuance and Grant of Warrants;
Form, Execution, Delivery and
Registration of Warrant Certificates
Section 2.01. Issuance and Grant of Warrants. In connection with the
delivery by the Company of each Borrowing Request pursuant to Section 2.02 of
the Credit Agreement, the Company will issue and grant to the Initial Holder a
number of Warrants equal to the Warrant Number. In the event that the Company
has complied with its obligations pursuant to the Credit Agreement and the
Initial Holder fails to make the Quarterly Loan contemplated by Section 2.02 of
the Credit Agreement, the Warrants evidenced by the Warrant Certificate that
accompanies the related Borrowing Request shall be null and void; provided,
however, that if the Initial Holder fails to make such Quarterly Loan as a
result of the Company's cancellation or revocation of such Borrowing Request or
as a result of the Company's failure to comply with its obligations under the
Credit Agreement, such Warrants and such Warrant Certificate shall not be
rendered null, void or otherwise invalid.
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<PAGE>
Section 2.02. Form of Warrant Certificates. The certificates evidencing
the Warrants (the "Warrant Certificates") shall be in registered form only, in
the form set forth in Exhibit A hereto and may represent any whole number of
Warrants. Each Warrant Certificate shall be dated the date of the Borrowing
Request accompanying such Warrant Certificate and may have imprinted or
otherwise reproduced thereon such letters, numbers or other marks of
identification as may, consistent with the provisions of this Agreement, be
determined by the officers executing any such Warrant Certificate.
Section 2.03. Execution and Delivery of Warrant Certificates. Each
Warrant Certificate shall be executed on behalf of the Company by (a) its
chairman, chief executive officer, president, or chief operating officer, and
(b) its chief financial officer, in any case either manually or by facsimile
signature printed thereon.
Section 2.04. Registration; Registration of Transfers and Exchanges.
(a) The Company will keep a register or registers in which the Company shall
maintain a master list of names and addresses of the Holders (the "Warrant
Register") and shall provide for the registration of, and registration of
transfer and exchange of, Warrant Certificates as provided in this Article. Each
person designated by the Company from time to time as a person having custody of
the Warrant Register and register the transfer and exchange of the Warrant
Certificates is hereinafter called, individually and collectively, the
"Registrar". The Company hereby appoints the Chief Financial Officer of the
Company as Registrar. Upon written notice to the Initial Holder and any acting
Registrar, the Company may appoint a successor Registrar for such purposes.
(b) Upon due presentation for registration of transfer of any Warrant
Certificate to the Registrar, the Company shall execute and deliver in the name
of the transferee or transferees a new Warrant Certificate or Warrant
Certificates in authorized denominations for a like aggregate number of Warrants
bearing numbers or other distinguishing symbols not contemporaneously
outstanding.
(c) Any Warrant Certificate or Warrant Certificates may be exchanged
for a Warrant Certificate or Warrant Certificates in other authorized
denominations, representing in the aggregate a like number of Warrants. A
Warrant
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<PAGE>
Certificate or Warrant Certificates to be so exchanged shall be surrendered to
the Registrar, and the Company shall execute and deliver in exchange therefor
the Warrant Certificate or Warrant Certificates bearing numbers or other
distinguishing symbols not contemporaneously outstanding.
(d) The Company and the Registrar may deem and treat the person in
whose name any Warrant Certificate shall be registered in the Warrant Register
as the absolute owner of such Warrant Certificate for the purpose of any
exercise thereof or any distribution to the Holder thereof and for all other
purposes.
(e) All Warrants presented for registration of transfer or exchange
shall (if so required by the Company or the Registrar) be duly endorsed by the
registered Holder or Holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney and shall be accompanied
by a written instrument or instruments of transfer or exchange.
(f) No service charge shall be made for any transfer or exchange of
Warrant Certificates, but the Company may require payment from the Holder(s) of
such Warrant Certificates of a sum sufficient to cover any stamp or other
governmental charge or tax that may be imposed in connection with any such
transfer or exchange.
Section 2.05. Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates. Upon receipt by the Registrar of evidence reasonably satisfactory
to the Company of the loss, theft, destruction, defacement, or mutilation of any
Warrant Certificate and, in the case of mutilation or defacement, upon surrender
thereof to the Registrar for cancellation, then the Company shall execute and
deliver, in exchange for or in lieu of the lost, stolen, destroyed, defaced or
mutilated Warrant Certificate, a new Warrant Certificate having the same tenor
and for a like number of Warrants, bearing a number or other distinguishing
symbol not contemporaneously outstanding. Upon the issuance of any new Warrant
Certificate pursuant to this Section 2.05, the Company may require the payment
from the Holder of such Warrant Certificate of a sum sufficient to cover any
tax, stamp tax or other governmental charge that may be imposed in relation
thereto and may require (if the Holder of such Warrant Certificate is the
Initial Holder or any of its Affiliates) a written instrument executed and
delivered by the Initial
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<PAGE>
Holder or The Pharmacia & Upjohn Company, a Delaware corporation, undertaking to
indemnify and defend the Company against all claims in respect of the lost,
stolen, destroyed, defaced or mutilated Warrant Certificate or (if the Holder is
not the Initial Holder or any of its Affiliates) a lost instrument bond
providing customary coverage. Every substitute Warrant Certificate executed and
delivered pursuant to this Section in lieu of any lost, stolen or destroyed
Warrant Certificate shall constitute an additional contractual obligation of the
Company, whether or not the lost, stolen or destroyed Warrant Certificate shall
be at any time enforceable by anyone, and shall be entitled to the benefits of
(but shall be subject to all the limitations of rights set forth in) this
Agreement equally and proportionately with any and all other Warrant
Certificates duly executed and delivered hereunder.
ARTICLE III
Exercise of Warrants
Section 3.01. Duration of Exercise Rights. Each Warrant shall be
exercisable as provided in this Article III from time to time on any Business
Day prior to the Close of Business on the Expiration Date for such Warrant.
Section 3.02. Right to Purchase. When exercised in accordance with
Section 3.03 or 3.07, each Warrant shall entitle the Holder to purchase, and the
Company shall be required to issue and deliver, a number of shares of Common
Stock equal to the Shares Amount in effect on the day such Warrant is exercised
in accordance with Section 3.03 or on the Trigger Date, in the case of an
exercise pursuant to Section 3.07, at the Exercise Price for such Warrant;
provided, however, that in the case of an exercise pursuant to Section 3.03, the
Company may, at its sole election, pay to the Holder of each Warrant so
exercised in respect of any one or more of such Warrants cash in an amount equal
to the Cash Amount in lieu of delivering the shares of Common Stock.
Section 3.03. Exercise Procedures. In order to exercise a Warrant, the
Holder must surrender the Warrant Certificate evidencing such Warrant to the
Registrar, with the form of election on the reverse of or attached to the
Warrant Certificate duly executed, together with payment of the Exercise Price.
Any such payment of the Exercise Price shall
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be by certified or official bank check or wire transfer to the Company of same
day funds.
Section 3.04. Delivery of Shares. In the event the Company elects to
deliver the Shares Amount as provided in Section 3.02, then upon surrender of
the Warrant Certificate in accordance with Section 3.03 the Company shall
promptly issue or cause to be issued to or upon the written order of the Holder
of such Warrant Certificate, a certificate or certificates evidencing the share
or shares of Common Stock to which such Holder is entitled, in fully registered
form, registered in such name or names as may be directed by such Holder
pursuant to the form of election on the reverse of or attached to the Warrant
Certificate. Such certificate or certificates evidencing such share or shares
shall be deemed to have been issued and any persons who are designated to be
named therein shall be deemed to have become the holder of record of such share
or shares as of the Close of Business on the date on which the Exercise Price
for the related Warrant or Warrants shall have been paid.
Section 3.05. Payment of Cash. If the Company elects to deliver the
Cash Amount as provided in Section 3.02, then upon surrender of the Warrant
Certificate in accordance with Section 3.03, the Company shall make prompt
payment of the Cash Amount in same day funds to the account specified on the
form of election on the reverse of or attached to the Warrant Certificate.
Section 3.06. Certificate for Unexercised Warrants. If fewer than all
the Warrants represented by a Warrant Certificate are exercised, such Warrant
Certificate shall be surrendered to the Registrar with instructions for the
issuance of a new Warrant Certificate and the Company shall promptly execute and
deliver a new Warrant Certificate for the Warrants that were not exercised
bearing numbers or other distinguishing symbols not contemporaneously
outstanding.
Section 3.07. Mandatory Exercise. (a) If and only if the average of the
Closing Prices of the Common Stock for the 30 Trading Days immediately preceding
a particular date (the "Trigger Date") exceeds the Exercise Price set forth in
the Warrant Certificate representing one or more Warrants, the Company shall be
entitled, at its option exercised within 30 days following the Trigger Date, to
cause the Holder of such Warrant Certificate to exercise all, but not fewer than
all,
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of the related Warrants (the "Called Warrants") as provided herein.
(b) If the Company elects to cause the Holder to exercise the Called
Warrants, it shall furnish to the Holder, within 30 calendar days following the
Trigger Date, a written notice thereof, (the "Call Notice"), specifying the
identifying number of the Warrant Certificate evidencing the Called Warrants and
the Trigger Date.
(c) Not later than three Business Days following the later of (i) the
date of the Call Notice, and (ii) the expiration or termination of any waiting
period (and any extension thereof) applicable to the acquisition by the Holder
thereof of the shares of Common Stock issuable upon exercise of the Called
Warrants under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended and the receipt of all governmental and contractual permits, consents
and approvals necessary in connection with such acquisition, the Company shall
deliver to the Holder of the Called Warrants a certificate evidencing a number
of shares of Common Stock equal to the product of (x) Shares Amount in effect on
the Trigger Date, multiplied by (y) the number of Called Warrants.
(d) Not later than three Business Days following the receipt of the
certificate referred to in Section 3.07(c), the Holder of the Called Warrants
shall deliver to the Company the certificate representing the Called Warrants
and a check for the product of (i) the Exercise Price, multiplied by (ii) the
number of Called Warrants.
ARTICLE IV
Compliance With the Securities Act and
Restrictions on Transfer of Shares
Section 4.01. Acknowledgment. The Initial Holder hereby acknowledges
that the Warrants and the shares of Common Stock that may be received by the
Initial Holder upon exercise of any Warrant are and will be subject to certain
restrictions on transfers under the Securities Act and the regulations
promulgated thereunder.
Section 4.02. Representation. The Initial Holder hereby represents to
the Company that it is acquiring the Warrants for its own account for investment
and not with a view to the resale or distribution of any interest therein.
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Section 4.03. Restrictions on Transfer of Shares. Prior to the
thirtieth calendar day following the issuance of shares of Common Stock upon the
exercise of Warrants, the Initial Holder shall not, and shall cause its
Affiliates not to, sell, assign, transfer or otherwise dispose of such shares,
except that the Initial Holder may transfer any such shares to any wholly owned
subsidiary of Pharmacia & Upjohn, Inc. The provisions of this Section 4.03 shall
not prohibit or restrict the sale, assignment, transfer or disposition at any
time of any shares of Common Stock acquired pursuant to Section 3.07.
ARTICLE V
Adjustments
Section 5.01. Adjustment upon Certain Transactions. The Shares Amount
(and, by virtue thereof, the Cash Amount) shall be subject to adjustment from
time to time on and subsequent to the date of this Agreement as follows:
(a) In case the Company shall pay or make a dividend or other
distribution on its Common Stock exclusively in Common Stock or shall pay or
make a dividend or other distribution on any other class or series of stock of
the Company which dividend or distribution includes Common Stock, the Shares
Amount in effect at the opening of business on the date following the date fixed
for the determination of stockholders entitled to receive such dividend or other
distribution shall be increased by multiplying such Shares Amount by a fraction
of which the denominator shall be the number of shares of Common Stock
outstanding at the Close of Business on the date fixed for such determination
and the numerator shall be the sum of such number of shares plus the total
number of shares constituting such dividend or other distribution, such increase
to become effective immediately after the opening of business on the day
following the date fixed for such determination. For the purposes of this
Section 5.01(a), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company. The Company shall
not pay any dividend or make any distribution on shares of Common Stock held in
the treasury of the Company.
(b) In case the Company shall pay or make a dividend or other
distribution on its Common Stock consisting
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exclusively of, or shall otherwise issue to all holders of its Common Stock,
rights or warrants entitling the holders thereof to subscribe for or purchase
shares of Common Stock at a price per share less than the current market price
per share (determined as provided in Section 5.01(g)) of the Common Stock on the
date fixed for the determination of stockholders entitled to receive such rights
or warrants, the Shares Amount in effect at the opening of business on the day
following the date fixed for such determination shall be increased by
multiplying the Shares Amount by a fraction of which the denominator shall be
the number of shares of Common Stock outstanding at the Close of Business on the
date fixed for such determination plus the number of shares of Common Stock
which the aggregate of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase would purchase at such
current market price and the numerator shall be the number of shares of Common
Stock outstanding at the Close of Business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such increase to become effective immediately after
the opening of business on the day following the date fixed for such
determination. For the purposes of this Section 5.01(b), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company. The Company shall not issue any rights or warrants in
respect of shares of Common Stock held in the treasury of the Company. In case
any rights or warrants referred to in this Section 5.01(b) in respect of which
an adjustment shall have been made shall expire unexercised within 60 days after
the same shall have been distributed or issued by the Company, the Shares Amount
shall be readjusted at the time of such expiration to the Shares Amount that
would have been in effect if no adjustment had been made on account of the
distribution or issuance of such expired rights or warrants.
(c) In case outstanding shares of Common Stock shall be subdivided into
a greater number of shares of Common Stock, the Shares Amount in effect at the
opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately increased, and conversely, in case
outstanding shares of Common Stock shall each be combined into a smaller number
of shares of Common Stock, the Shares Amount in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately decreased, such reduction or increase, as the
case may be, to become effective
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immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective. No reduction in the
Shares Amount may occur except pursuant to this Section 5.01(c) or the last
sentence of Section 5.01(b).
(d) Subject to the last two sentences of this Section 5.01(d), in case
the Company shall, by dividend or otherwise, distribute to all holders of its
Common Stock evidences of its indebtedness, shares of any class or series of
stock, cash or assets (including securities, but excluding any rights or
warrants referred to in Section 5.01(b), any dividend or distribution paid
exclusively in cash and any dividend or distribution referred to in Section
5.01(a)), the Shares Amount shall be increased so that the same shall equal the
number determined by multiplying the Shares Amount in effect immediately prior
to the effectiveness of the Shares Amount increase contemplated by this Section
5.01(d) by a fraction of which the numerator shall be the current market price
per share (determined as provided in Section 5.01(g)) of the Common Stock on the
date fixed for the payment of such distribution (the "Reference Date") plus the
fair market value (as determined in good faith by the Board of Directors and
described in a resolution of the Board of Directors), on the Reference Date of
the portion of the evidences of indebtedness, shares of stock, cash and assets
so distributed applicable to one share of Common Stock and the denominator shall
be such current market price per share of the Common Stock, such increase to
become effective immediately prior to the opening of business on the day
following the Reference Date. If the Board of Directors determines the fair
market value of any distribution for purposes of this Section 5.01(d) by
reference to the actual or when issued trading market for any securities
comprising such distribution, it must in doing so consider the prices in such
market over the same period used in computing the current market price per share
of Common Stock pursuant to Section 5.01(g). For purposes of this Section
5.01(d), any dividend or distribution that includes shares of Common Stock or
rights or warrants to subscribe for or purchase shares of Common Stock shall be
deemed instead to be (1) a dividend or distribution of the evidences of
indebtedness, cash, assets or shares of stock other than such shares of Common
Stock or such rights or warrants (making any Shares Amount increase required by
this Section 5.01(d)) immediately followed by (2) a dividend or distribution of
such shares of Common Stock or such rights or warrants (making any further
Shares Amount increase required by Section 5.01(a) or
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(b) except (A) the Reference Date of such dividend or distribution as defined in
this Section 5.01(d) shall be substituted as "the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution", "the date fixed for the determination of stockholders entitled to
receive such rights or warrants" and "the date fixed for such determination"
within the meaning of Section 5.01(a) or (b) and (B) any shares of Common Stock
included in such dividend or distribution shall not be deemed "outstanding at
the Close of Business on the date fixed for such determination" within the
meaning of Section 5.01(a) or (b)).
(e) In case the Company shall pay or make a dividend or other
distribution on the Common Stock exclusively in cash the Shares Amount shall be
increased so that the same shall equal the number determined by multiplying the
Shares Amount in effect immediately prior to the effectiveness of the Shares
Amount increase contemplated by this Section 5.01(e) by a fraction of which the
numerator shall be the current market price per share (determined as provided in
Section 5.01(g)) of the Common Stock on the date fixed for the payment of such
distribution plus the amount of cash so distributed applicable to one share of
Common Stock and the denominator shall be such current market price per share of
Common Stock, such increase to become effective immediately prior to the opening
of business on the day following the date fixed for the payment of such
distribution.
(f) In case a tender or exchange offer made by the Company or by any
subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer shall involve the payment by the
Company or such subsidiary of consideration per share of Common Stock having a
fair market value (as determined in good faith by the Board of Directors and
described in a resolution of the Board of Directors) at the last time (the
"Expiration Time") shares of Common Stock may be tendered into to such tender or
exchange offer (as it shall have been amended) that exceeds the current market
price per share (determined as provided in Section 5.01(g)) of the Common Stock
on the Trading Day next succeeding the Expiration Time, the Shares Amount shall
be increased so that the same shall equal the number determined by multiplying
the Shares Amount in effect immediately prior to the effectiveness of the Shares
Amount increase contemplated by this Section 5.01(f) by a fraction of which the
denominator shall be the number of shares of Common Stock
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outstanding (including any tendered or exchanged shares) at the Expiration Time
multiplied by the current market price per share (determined as provided in
Section 5.01(g)) of the Common Stock on the Trading Day next succeeding the
Expiration Time and the numerator shall be the sum of (x) the fair market value
(determined as aforesaid) of the aggregate consideration payable to stockholders
based on the acceptance (up to any maximum specified in the terms of the tender
or exchange offer) of all shares validly tendered or exchanged and not withdrawn
as of the Expiration Time (the shares deemed so accepted, up to any such
maximum, being referred to as the "Purchased Shares") and (y) the product of the
number of shares of Common Stock outstanding (less any Purchased Shares) at the
Expiration Time and the current market price per share (determined as provided
in Section 5.01(g)) of the Common Stock on the Trading Day next succeeding the
Expiration Time, such increase to become effective immediately prior to the
opening of business on the day following the Expiration Time.
(g) For the purpose of any computation under Section 5.01(b), (d), (e)
and (f), the "current market price" per share of Common Stock on any date in
question shall be deemed to be the average of the daily Closing Prices for the
five consecutive Trading Days prior to and including the date in question;
provided, however, that (1) if the "ex" date (as hereinafter defined) for any
event (other than the issuance or distribution requiring such computation) that
requires an adjustment to the Shares Amount pursuant to Section 5.01(a), (b),
(c), (d), (e), (f) or (h) ("Other Event") occurs after the fifth Trading Day
prior to the day in question and prior to the "ex" date for the issuance or
distribution requiring such computation (the "Current Event"), the Closing Price
for each Trading Day prior to the "ex" date for such Other Event shall be
adjusted by multiplying such Closing Price by the reciprocal of the fraction by
which the Shares Amount is so required to be adjusted as a result of such Other
Event, (2) if the "ex" date for any Other Event occurs after the "ex" date for
the Current Event and on or prior to the date in question, the Closing Price for
each Trading Day on and after the "ex" date for such Other Event shall be
adjusted by multiplying such Closing Price by the fraction by which the Shares
Amount is so required to be adjusted as a result of such Other Event, (3) if the
"ex" date of any Other Event occurs on the "ex" date for the Current Event, one
of those events shall be deemed for purposes of clauses (1) and (2) of this
proviso to have an "ex" date occurring prior to the "ex" date for the other
event, and (4) if the "ex" date for the
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Current Event is on or prior to the date in question, after taking into account
any adjustment required pursuant to clause (2) of this proviso, the Closing
Price for each Trading Day on or after such "ex" date shall be adjusted by
adding thereto the amount of any cash and the fair market value on the date in
question (as determined in good faith by the Board of Directors in a manner
consistent with any determination of such value for purposes of Section 5.01(d)
or (e), and described in a resolution of the Board of Directors) of the portion
of the rights, warrants, evidences of indebtedness, shares of stock or assets
being distributed applicable to one share of Common Stock. For the purpose of
any computation under Section 5.01(f), the current market price per share of
Common Stock on any date in question shall be deemed to be the average of the
daily Closing Prices for such date in question and the next two succeeding
Trading Days; provided, however, that if the "ex" date for any event (other than
the tender or exchange offer requiring such computation) that requires an
adjustment to the Shares Amount pursuant to Section 5.01(a), (b), (c), (d), (e),
(f) or (h) occurs after the Expiration Time for the tender or exchange offer
requiring such computation and on or prior to the second Trading Day following
the date in question, the Closing Price for each Trading Day on and after the
"ex" date for such other event shall be adjusted by multiplying such Closing
Price by the fraction by which the Shares Amount is so required to be adjusted
as a result of such other event. For purposes of this paragraph, the term "ex"
date, (1) when used with respect to any issuance or distribution, means the
first date on which the Common Stock trades regular way on the relevant exchange
or in the relevant market from which the Closing Price was obtained without the
right to receive such issuance or distribution, (2) when used with respect to
any subdivision or combination of shares of Common Stock, means the first date
on which the Common Stock trades regular way on such exchange or in such market
after the time at which such subdivision or combination becomes effective, and
(3) when used with respect to any tender or exchange offer, means the first date
on which the Common Stock trades regular way on such exchange or in such market
after the Expiration Time of such offer.
(h) The Company may make such increase in the Shares Amount, in
addition to those required by Section 5.01(a), (b), (c), (d), (e) and (f) as it
considers to be advisable to avoid or diminish an income tax to holders of
Common Stock or rights to purchase Common Stock resulting from any dividend or
distribution of stock (or rights to acquire
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stock) or from any event treated as such for income tax purposes. The Company
from time to time may increase the Shares Amount by any amount for any period of
time if the period is at least twenty days, the increase is irrevocable during
the period, and the Board of Directors shall have made a determination that such
increase would be in the best interest of the Company. Whenever the Shares
Amount is increased pursuant to the preceding sentence, the Company shall mail
to Holders a notice of the increase at least fifteen days prior to the date the
increased Shares Amount takes effect, and such notice shall state the increased
Shares Amount and the period it will be in effect.
(i) No adjustment in the Shares Amount shall be required unless such
adjustment would require an increase or decrease of at least 1% in the Shares
Amount; provided, however, that any adjustments which by reason of this Section
5.01(i) are not required to be made shall be carried forward and taken into
account in any subsequent adjustment.
(j) Whenever the Shares Amount is adjusted as herein provided, the
Company shall compute the adjusted Shares Amount and shall prepare a certificate
signed by the Chief Financial Officer of the Company setting forth the adjusted
Shares Amount and showing in reasonable detail the facts upon which such
adjustment is based, and a copy of such certificate shall forthwith be delivered
to each Holder.
Section 5.02. No Fractional Shares. No fractional shares of Common
Stock shall be issued upon exercise of the Warrants. If more than one Warrant is
exercised by the same Holder at one time, the number of full shares issuable
upon such exercise shall be computed on the basis of the aggregate number of
Warrants so exercised. Instead of any fractional share of Common Stock that
would otherwise be issuable to a holder upon exercise of the Warrants, the
Company shall pay a cash adjustment in respect of such fractional share in an
amount equal to the same fraction of the Closing Price per share of Common Stock
as of the date of such exercise.
Section 5.03. Reclassification, Consolidation, Merger or Sale of
Assets. In the event that the Company shall be a party to any transaction
(including without limitation any recapitalization or reclassification of the
Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination of the Common Stock and other than
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the reclassification of unissued Common Stock into other stock of the Company),
any consolidation of the Company with, or merger of the Company into, any other
Person, any merger of another person into the Company (other than a merger which
does not result in a reclassification, conversion, exchange or cancellation of
outstanding shares of Common Stock of the Company), any sale or transfer of all
or substantially all of the assets of the Company or any compulsory share
exchange) pursuant to which the Common Stock is converted into the right to
receive other securities, cash or other property, then lawful provisions shall
be made as part of the terms of such transaction whereby the holder of each
Warrant then outstanding shall have the right thereafter to exercise such
Warrant only for (i) in the case of any such transaction other than a Common
Stock Fundamental Change (as defined in Section 5.06(b)) and subject to funds
being legally available for such purpose under applicable law at the time of
such exercise, the kind and amount of securities, cash and other property
receivable upon such transaction by a holder of the number of shares of Common
Stock of the Company for which such Warrant could have been exercised
immediately prior to such transaction, and (ii) in the case of a Common Stock
Fundamental Change, common stock of the kind received by holders of Common Stock
as a result of such Common Stock Fundamental Change in an amount determined
pursuant to the provisions of Section 5.05. The Company or the Person formed by
such consolidation or resulting from such merger or which acquires such assets
or which acquires the Company's shares, as the case may be, shall execute an
agreement in form and substance reasonably acceptable to the Holders evidencing
such right. Such agreement shall provide for adjustments which, for events
subsequent to the effective date of such agreement, shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
VI. The above provisions shall similarly apply to each and every successive
transaction of the foregoing type.
Section 5.04. Prior Notice of Certain Events. In case:
(a) the Company shall (i) declare any dividend (or any other
distribution) on its Common Stock, other than (A) a dividend payable in
shares of Common Stock or (B) a dividend payable in cash in an amount
not greater than its retained earnings other than any special or
nonrecurring or other extraordinary dividend or (ii) declare or
authorize a redemption or repurchase of
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in excess of 10% of the then-outstanding shares of Common
Stock; or
(b) the Company shall authorize the granting to all holders of
Common Stock of rights or warrants to subscribe for or purchase any
share of stock of any class or series or of any other rights or
warrants; or
(c) of any reclassification of Common Stock (other than a
subdivision or combination of the outstanding Common Stock, or a change
in par value, or from par value to no par value, or from no par value
to par value and other than the reclassification of unissued Common
Stock into other stock of the Company), or of any consolidation or
merger to which the Company is a party and for which approval of any
shareholders of the Company shall be required, or of the sale or
transfer of all or substantially all of the assets of the Company or of
any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or other property; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then the Company shall cause to be delivered to the Holders, at least 10 days
prior to the applicable record or effective date hereinafter specified, a notice
stating (x) the date on which a record (if any) is to be taken for the purpose
of such dividend, distribution, redemption, repurchase, rights or warrants or,
if a record is not to be taken, the date as of which the holders of Common Stock
of record to be entitled to such dividend, distribution, redemption, rights or
warrants are to be determined or (y) the date on which such reclassification,
consolidation, merger, sale, transfer, share exchange, dissolution, liquidation
or winding up is expected to become effective, and the date as of which it is
expected that holders of Common Stock of record shall be entitled to exchange
their shares of Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer, share
exchange, dissolution, liquidation or winding up (but no failure to mail such
notice or any defect therein or in the mailing thereof shall affect the validity
of the corporate action required to be specified in such notice).
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Section 5.05. Adjustments in Case of Fundamental Changes. (a)
Notwithstanding any other provision in this Article 6 to the contrary, if any
Fundamental Change (as defined in Section 5.06(c)) occurs, then the Shares
Amount in effect will be adjusted immediately after such Fundamental Change as
described in Section 5.05(c). In addition, in the event of a Common Stock
Fundamental Change (as defined in Section 5.06(b)), each Warrant shall be
exercisable solely in exchange for common stock of the kind and amount received
by holders of Common Stock as a result of such Common Stock Fundamental Change
as more specifically provided in Section 5.05(b).
(b) For purposes of calculating any adjustment to be made pursuant to
this Section 5.05 in the event of a Fundamental Change, immediately after such
Fundamental Change in the case of a Common Stock Fundamental Change, the Shares
Amount in effect immediately prior to such Common Stock Fundamental Change, but
after giving effect to any other prior adjustments effected pursuant to this
Article V, shall thereupon be adjusted by multiplying such Shares Amount by a
fraction of which the denominator shall be the Purchaser Stock Price (as defined
in Section 5.06(e)) and the numerator shall be the Applicable Price (as defined
in Section 5.06(a)); provided, however, that in the event of a Common Stock
Fundamental Change in which (A) 100% by value of the consideration received by a
holder of Common Stock is common stock of the successor, acquiror or other third
party (and cash, if any, is paid with respect to any fractional interests in
such common stock resulting from such Common Stock Fundamental Change) and (B)
all of the Common Stock shall have been exchanged for, converted into or
acquired for common stock (and cash with respect to fractional interests) of the
successor, acquiror or other third party, the Shares Amount in effect
immediately prior to such Common Stock Fundamental Change shall thereupon be
adjusted by multiplying such Shares Amount by the number of shares of common
stock of the successor, acquiror, or other third party received by a shareholder
for one share of Common Stock as a result of such Common Stock Fundamental
Change.
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Section 5.06. Definitions. The following definitions shall apply to
terms used in this Article V:
(a) "Applicable Price" means (1) in the event of a Non-Stock
Fundamental Change in which the holders of the Common Stock receive only cash,
the amount of cash received by a shareholder for one share of Common Stock and
(2) in the event of any other Non-Stock Fundamental Change or any Common Stock
Fundamental Change, the average of the daily Closing Prices of the Common Stock
for the ten consecutive Trading Days prior to and including the record date for
the determination of the holders of Common Stock entitled to receive securities,
cash or other property in connection with such Non-Stock Fundamental Change or
Common Stock Fundamental Change, or, if there is no such record date, the date
upon which the holders of the Common Stock shall have the right to receive such
securities, cash or other property, in each case, as adjusted in good faith by
the Board of Directors of the Company to appropriately reflect any of the events
referred to in Section 5.01(a), (b), (c), (d), (e), (f) and (h).
(b) "Common Stock Fundamental Change" means any Fundamental Change in
which more than 50% by value (as determined in good faith by the Board of
Directors) of the consideration received by holders of Common Stock consists of
common stock that for each of the ten consecutive Trading Days referred to with
respect to such Fundamental Change in Section 5.05(i) above has been admitted
for listing or admitted for listing subject to notice of issuance on a national
securities exchange or quoted on the NASDAQ National Market System; provided,
however, that a Fundamental Change shall not be a Common Stock Fundamental
Change unless either (1) the Company continues to exist after the occurrence of
such Fundamental Change and the outstanding Warrants continue to exist as
outstanding Warrants, or (2) not later than the occurrence of such Fundamental
Change, the outstanding Warrants are converted into or exchanged for warrants of
a corporation succeeding to the business of the Company, which warrants have
terms identical to those of the Warrants.
(c) "Fundamental Change" means the occurrence of any transaction or
event in connection with a plan pursuant to which all or substantially all of
the Common Stock shall be exchanged for, converted into, acquired for or
constitute solely the right to receive securities, cash or other property
(whether by means of an exchange offer, liquidation, tender offer,
consolidation, merger, combination, reclassification,
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recapitalization or otherwise); provided, however, in the case of a plan
involving more than one such transaction or event, for purposes of adjustment of
the Shares Amount, such Fundamental Change shall be deemed to have occurred when
substantially all of the Common Stock of the Company shall be exchanged for,
converted into, or acquired for or constitute solely the right to receive cash,
securities, property or other assets, but the adjustment shall be based upon the
highest weighted average of consideration per share which a holder of Common
Stock could have received in such transactions or events as a result of which
more than 50% of the Common Stock shall have been exchanged for, converted into,
or acquired for or constitute solely the rights to receive cash, securities,
property or other assets.
(d) "Non-Stock Fundamental Change" means any Fundamental Change other
than a Common Stock Fundamental Change.
(e) "Purchaser Stock Price" means, with respect to any Common Stock
Fundamental Change, the average of the daily Closing Prices of the common stock
received in such Common Stock Fundamental Change for the ten consecutive Trading
Days prior to and including the record date for the determination of the holders
of Common Stock entitled to receive such common stock, or, if there is no such
record date, the date upon which the holders of the Common Stock shall have the
right to receive such common stock, in each case, as adjusted in good faith by
the Board of Directors to appropriately reflect any of the events referred to in
Section 5.01(a), (b), (c), (d), (e), (f) and (h); provided, however, if no such
Closing Prices of the common stock for such Trading Days exist, then the
Purchaser Stock price shall be set at a price determined in good faith by the
Board of Directors.
Section 5.07. Certain Additional Rights. In case the Company shall, by
dividend or otherwise, declare or make a distribution on the Common Stock
referred to in Section 5.01(d) or 5.01(e) (including, without limitation,
dividends or distributions referred to in the last two sentences of Section
5.01(d)), the holder of each Warrant, upon the exercise thereof subsequent to
the Close of Business on the date fixed for the determination of shareholders
entitled to receive such distribution and prior to the effectiveness of the
Shares Amount adjustment in respect of such distribution, shall also be entitled
to receive for each share of Common Stock for which such Warrant is exercised,
the
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portion of the shares of Common Stock, rights, warrants, evidences of
indebtedness, shares of stock, cash and assets so distributed applicable to one
share of Common Stock; provided, however, that, at the election of the Company
(whose election shall be evidenced by a resolution of the Board of Directors)
with respect to all holders so exercising, the Company may, in lieu of
distributing to such holder any portion of such distribution not consisting of
cash or securities of the Company, pay such holder an amount in cash equal to
the fair market value thereof (as determined in good faith by the Board of
Directors and described in a resolution of the Board of Directors). If any
exercise of a Warrant described in the immediately preceding sentence occurs
prior to the payment date for a distribution to holders of Common Stock which
the holder of the Warrant so exercised is entitled to receive in accordance with
the immediately preceding sentence, the Company may elect (such election to be
evidenced by a resolution of the Board of Directors) to distribute to such
holder a due bill for the shares of Common Stock, rights, warrants, evidences of
indebtedness, shares of stock, cash or assets to which such holder is so
entitled, provided that such due bill (i) meets any applicable requirements of
the principal national securities exchange or other market on which the Common
Stock is then traded and (ii) requires payment or delivery of such shares of
Common Stock, rights, warrants, evidences of indebtedness, shares of stock, cash
or assets no later than the date of payment or delivery thereof to holders of
shares of Common Stock receiving such distribution.
Section 5.08. Reservation of Shares, etc. (a) The Company shall at all
times reserve and keep available, free from preemptive rights out of its
authorized and unissued stock, solely for the purpose of allowing the exercise
of the Warrants, such number of shares of its Common Stock as shall from time to
time be sufficient to permit the Company to deliver the Shares Amount in the
event all of the Warrants from time to time outstanding were exercised. The
Company shall from time to time, in accordance with the laws of the State of
Delaware, increase the authorized number of shares of Common Stock if at any
time the number of shares of authorized and unissued Common Stock shall not be
sufficient to permit the Company to deliver the Shares Amount upon the exercise
of all of the then-outstanding Warrants (taking into account the adjustments to
the Shares Amount that are provided for herein).
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(b) If any shares of Common Stock required to be reserved for purposes
of the exercise of the Warrants hereunder require registration with or approval
of any governmental authority under any Federal or State law before such shares
may be issued upon exercise, and an exemption under Section 3(a)(9) of the
Securities Act or similar exemption is not available, the Company will in good
faith and as expeditiously as possible endeavor to cause such shares to be duly
registered or approved as the case may be. If the Common Stock is quoted on the
NASDAQ National Market System or listed on any U.S. national securities
exchange, the Company will, if permitted by the rules of such exchange, list and
keep listed on such exchange, upon official notice of issuance, all shares of
Common Stock issuable upon exercise of the Warrants. The second sentence of this
paragraph shall apply only when the Warrants shall have become freely
transferable pursuant to Rule 144(k) under the Securities Act or if the shares
of Common Stock issuable upon exercise of the Warrants are exempt from the
registration requirements of the Securities Act by operation of an exemption
referred to in the first sentence of this paragraph.
Section 5.09. Dividend or Interest Reinvestment Plans or Other Plans.
Notwithstanding the foregoing provisions, the issuance of any shares of Common
Stock pursuant to any plan providing for the reinvestment of dividends or
interest payable on securities of the Company and the investment of additional
optional amounts in shares of Common Stock under any such plan (i.e., a "DRIP"),
and the issuance of any shares of Common Stock or options or rights to purchase
such shares pursuant to any employee or director benefit plan or program of the
Company or pursuant to any option, warrant, right or exercisable, exchangeable
or convertible security outstanding as of the date hereof shall not be deemed to
constitute an issuance of Common Stock or exercisable, exchangeable or
convertible securities by the Company to which any of the adjustment provisions
described above applies. In addition, no adjustment to the Shares Amount or Cash
Amount pursuant to this Article V shall be made in respect of any transaction
expressly permitted by Section 7.02(h)(iii) of the Credit Agreement. If any
action would require adjustment of the Shares Amount pursuant to more than one
of the provisions described in this Article V only one adjustment shall be made
and such adjustment shall be the amount of adjustment which has the highest
absolute value to holders of the Warrants.
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ARTICLE VI
Representations and Warranties
The Company hereby represents and warrants, as of the date of this
Agreement, as follows:
Section 6.01. Good Standing and Power. The Company is a corporation,
duly incorporated and validly existing in good standing under the laws of the
jurisdiction of its incorporation.
Section 6.02. Corporate Authority. The Company has full corporate power
and authority to execute and deliver, and to incur and perform its obligations
under, this Agreement and each Warrant Certificate, all of which have been duly
authorized and will have been duly authorized by all proper and necessary
corporate action. No consent or approval of stockholders is required or will be
required as a condition to the validity or performance of, or the exercise by
any Holder of any of its rights or remedies under, this Agreement or any Warrant
Certificate.
Section 6.03. Authorizations. All authorizations, consents, approvals,
registrations, notices, exemptions and licenses with or from any Governmental
Authority or other Person necessary for the execution, delivery and performance
by the Company of, and the incurrence and performance of each of its obligations
under, this Agreement and each Warrant Certificate, and the exercise by any
Holder of its remedies under this Agreement or any Warrant Certificate have been
effected or obtained and are and will be in full force and effect.
Section 6.04. Binding Obligation. This Agreement constitutes and, when
issued in accordance with the terms hereof, each Warrant Certificate will
constitute, a valid and legally binding obligation of the Company enforceable in
accordance with its terms, subject as to enforcement to bankruptcy, insolvency,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles.
Section 6.05. No Conflicts. There is no statute, regulation, rule,
order or judgment, and no provision of any agreement or instrument binding upon
the Company or any of its subsidiaries, or affecting their properties, and no
provision
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of the certificate of incorporation or bylaws of the Company or any of its
subsidiaries, that would prohibit, conflict with or in any way impair the
execution or delivery of, or the incurrence or performance of any obligations of
the Company under, this Agreement or any Warrant Certificate, or result in or
require the creation or imposition of any lien, charge or encumbrance of any
type on property of the Company or any of its subsidiaries as a consequence of
the execution, delivery and performance of this Agreement or any Warrant
Certificate.
Section 6.06. Reservation. The Board of Directors has unanimously
adopted the resolutions set forth in Exhibit B.
ARTICLE VII
Covenants
Section 7.01. Reservation of Common Stock for Issuance on Exercise of
Warrants. The Company covenants that it will at all times reserve and keep
available, free from preemptive rights, out of its authorized but unissued
shares of Common Stock, solely for the purpose of issue upon exercise of
Warrants, as herein provided, such number of shares of Common Stock as shall
then be issuable upon the exercise of all Warrants issued hereunder. The
transfer agent for the Common Stock (the "Transfer Agent") will be irrevocably
authorized and directed at all times to reserve such number of authorized shares
as shall be required for such purpose. The Company will keep a copy of this
Agreement on file with the Transfer Agent. The Warrant Agent is hereby
irrevocably authorized to requisition from time to time from such Transfer Agent
the stock certificates required to honor outstanding Warrants upon exercise
thereof in accordance with the terms of this Agreement. The Company represents,
warrants and covenants that, upon payment therefor, all shares of Common Stock
issued upon the exercise of warrants shall be duly authorized, validly issued,
fully paid and nonassessable, free of preemptive rights and free from all taxes,
liens, charges and security interests with respect to the issuance thereof.
Section 7.02. Notice of Dividends. At any time when and if the Company
declares any dividend on Common Stock, it shall give notice to the Holders of
all the then outstanding Warrants of any such declaration not fewer than
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10 days prior to the related record date for payment of the dividend so
declared.
Section 7.03. Reports. For so long as any Warrants remain outstanding
and not expired by their terms, the Company shall furnish to the Holders the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act. In addition, the Company shall furnish to the Initial Holder
within ten days after it files them with the Commission copies of its SEC
Reports. In the event the Company shall cease to be required to file SEC Reports
pursuant to the Exchange Act, the Company shall nevertheless mail such SEC
Reports to Holders upon their request.
ARTICLE VIII
Holders
Section 8.01. Holder Not Deemed a Shareholder. No Holder, as such,
shall be entitled to vote, receive dividends or be deemed for any purpose the
holder of Common Stock or any other securities of the Company which may at any
time be issuable on the exercise or conversion of the Warrants represented
thereby, nor shall anything contained herein or in any Warrant Certificate be
construed to confer upon a Holder, as such, any of the rights of a stockholder
of the Company or any right to vote for the election of directors or upon any
matter submitted to shareholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting stockholders (except as specifically provided herein), or to
receive dividends or subscriptions rights, or otherwise, until the Warrant or
Warrants evidenced by such Warrant Certificate shall have been exercised and the
Company shall have elected to deliver Common Stock (and not cash) upon such
exercise.
Section 8.02. Right of Action. All rights of action in respect of this
Agreement are vested in the Holders, and any Holder of any Warrant, without
consent of any other Holder, may on such Holder's own behalf and for such
Holder's own benefit, enforce, and may institute and maintain any suit, action
or proceeding against the Company suitable to enforce, or otherwise in respect
of, such Holder's right to exercise or exchange such Holder's Warrants in the
manner provided in this Agreement.
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ARTICLE IX
Miscellaneous
Section 9.01. Payment of Taxes. The Company shall pay all transfer,
stamp and other similar taxes that may be imposed in respect of the issuance or
delivery of Warrants, or in respect of the issuance or delivery of any
securities upon exercise of Warrants, and any and all filing fees incurred by a
Holder in connection with the matters described in Section 3.07(c)(ii). The
Company shall not be required, however, to pay any tax or other charge imposed
in connection with any transfer involved in the issue of any certificate for
shares of Common Stock or other securities underlying the Warrants or payment of
cash to any Person other than the Holder of a Warrant Certificate surrendered
upon the exercise or purchase of a Warrant, and in case of such transfer or
payment, the Company shall not be required to issue any stock certificate or pay
any cash until such tax or charge has been paid or it has been established to
the Company's reasonable satisfaction that no such tax or other charge is due.
Section 9.02. Expenses; Indemnity. (a) The Company agrees to pay or
reimburse the Initial Holder for all reasonable costs and expenses incurred in
connection with the enforcement or preservation of any rights under this
Agreement, any Warrant, any Warrant Certificate, and any such other documents,
including, without limitation, the reasonable fees and disbursements of counsel
to the Initial Holder (but excluding fees and disbursements incurred on or prior
to the date hereof in negotiating and preparing this Agreement and the related
documents); provided, however, that in the event of any litigation between the
Company and any Holder initiated prior to any Event of Default specified in
Section 8.01(g) or (h) of the Credit Agreement and arising out of the matters
set forth in Section 9.04(b)(i), the fees and disbursements of counsel to the
Initial Holder shall be borne by the Company if and only if the Initial Holder
is the prevailing party.
(b) The Company agrees to indemnify the Initial Holder and its
directors, officers, employees, agents and Affiliates (each, an "Indemnitee")
against, and to hold each Indemnitee harmless from, any and all claims,
liabilities, damages, losses, costs, charges and expenses (including fees and
expenses of counsel) incurred by or asserted against any Indemnitee arising out
of, in any way connected with, or as a result of (i) the execution or delivery
of this Agreement or
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any agreement or instrument contemplated by this Agreement, the performance by
the parties hereto of their respective obligations under this Agreement, any
Warrant or any Warrant Certificate or the consummation of the transactions and
the other transactions contemplated hereby or thereby, (ii) the use of the
proceeds of the exercise of Warrants or (iii) any claim, litigation,
investigation or proceeding relating to any of the foregoing, whether or not any
Indemnitee is a party thereto. The provisions of this Section 9.04(b) shall not
operate or be construed to indemnify the Initial Holder against, or hold it
harmless from, any claims, liabilities, damages, losses, costs, charges and
expenses (including fees and expenses of counsel) incurred by or asserted
against the Initial Holder arising out of or connected with any litigation
initiated prior to any Event of Default specified in Section 8.01(g) or (h)
solely between the Company and the Initial Holder in which the Initial Holder is
not the prevailing party.
(c) All amounts due under this Section 9.02 shall be payable in
immediately available funds upon written demand therefor.
SECTION 9.03. APPLICABLE LAW. THIS AGREEMENT, EACH WARRANT CERTIFICATE,
EACH WARRANT ISSUED HEREUNDER AND ALL RIGHTS ARISING HEREUNDER SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE.
SECTION 9.04. WAIVER OF JURY. THE COMPANY AND THE INITIAL HOLDER EACH
HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY WARRANT
CERTIFICATE, ANY WARRANT ISSUED HEREUNDER AND ANY RIGHT ARISING HEREUNDER.
Section 9.05. Jurisdiction and Venue; Service of Process. (a) The
Company and the Initial Holder each hereby irrevocably submits to the
non-exclusive jurisdiction of any state or federal court in the Borough of
Manhattan, The City of New York for the purpose of any suit, action, proceeding
or judgment relating to or arising out of this Agreement, any Warrant
Certificate, any Warrant issued hereunder and any right arising hereunder, and
to the laying of venue in the
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Borough of Manhattan, The City of New York. The Company and the Initial Holder
each hereby irrevocably waives, to the fullest extent permitted by applicable
law, any objection to the laying of the venue of any such suit, action or
proceeding brought in the aforesaid courts and hereby irrevocably waives any
claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
(b) The Company agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
Company at its address set forth in Section 9.08 or at such other address of
which the Initial Holder shall have been notified pursuant thereto. The Company
further agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue any
other jurisdiction.
(c) Each of the Initial Holder and the Company waives, to the maximum
extent not prohibited by law, any right it may have to claim or recover in any
legal action or proceeding referred to in this Section 9.05 any special,
exemplary, punitive or consequential damages.
Section 9.06. Amendments and Waivers. (a) Any provision of this
Agreement may be amended, modified, supplemented or waived, but only by a
written amendment or supplement, or written waiver, signed by the Company and
the Initial Holder.
(b) Except to the extent expressly set forth therein, any waiver shall
be effective only in the specific instance and for the specific purpose for
which such waiver is given.
Section 9.07. Cumulative Rights; No Waiver. Each and every right
granted to any Holder hereunder or under any Warrant Certificate, or allowed
such Holder by law or equity, shall be cumulative and not exclusive and may be
exercised from time to time. No failure on the part of any Holder to exercise,
and no delay in exercising, any right will operate as a waiver thereof, nor will
any single or partial exercise by any Holder of any right preclude any other or
future exercise thereof or the exercise of any other right.
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Section 9.08. Notices. (a) Any communication, demand or notice to be
given hereunder will be duly given when delivered in writing or by telecopy to a
party at its address as indicated below or such other address as such party may
specify in a notice to each other party hereto. A communication, demand or
notice given pursuant to this Section 9.08 shall be addressed:
If to the Company, to
Miravant Medical Technologies
7408 Hollister Avenue
Santa Barbara, California 93117
Telecopy: (805) 685-6038
Attention: Gary S. Kledzik
with a copy (which, in and of itself, shall not constitute notice) to
Nida & Maloney PC
800 Anacapa Street
Santa Barbara, California 93101
Telecopy: (805) 568-1955
Attention: Joseph E. Nida
and
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304
Telecopy: (650) 493-6811
Attention: John T. Sheridan
If to the Initial Holder, to
Pharmacia & Upjohn Treasury Services AB
Lindhagensgatan 133
S-112 87 Stockholm, Sweden
Telecopy: +46 8 695 47 08
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Attention: Associate General Counsel
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-470-8047
Attention: Treasurer
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4485
Attention: Senior Vice President of Business
Development
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4489
Attention: General Counsel
with a copy (which, in and of itself, shall not constitute
notice) to
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Telecopy: (212) 558-3588
Attention: Neil T. Anderson,
Matthew G. Hurd
and Martin J. Travers
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(b) Unless otherwise provided to the contrary herein, any notice which
is required to be given in writing pursuant to the terms of this Agreement may
be given by telecopy.
Section 9.09. Separability. In case any one or more of the provisions
contained in this Agreement or any Warrant Certificate shall be invalid, illegal
or unenforceable in any respect under any law, the validity, legality and
enforceability of the remaining provisions contained in this Agreement or any
Warrant Certificate shall not in any way be affected or impaired thereby.
Section 9.10. Persons Benefitting. This Agreement shall be binding upon
and inure to the benefit of any Holders (each of whom is an intended third party
beneficiary) and the Company, and their respective successors, assigns,
beneficiaries, executors and administrators. Nothing in this Agreement is
intended or shall be construed to confer upon any Person, other than the Company
and the Holders (and such successors, assigns, beneficiaries, executors and
administrators), any right, remedy or claim under or by reason of this Agreement
or any part hereof.
Section 9.11. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together constitute one and the same instrument.
Section 9.12. Headings. The descriptive headings of the several
Sections of this Agreement are inserted for convenience and shall not control or
affect the meaning or construction of any of the provisions hereof.
Section 9.13. Remedies. In the event of a breach by the Company or by a
Holder of any of their obligations under this Agreement or any Warrant
Certificate, each Holder or the Company, as the case may be, in addition to
being entitled to exercise all rights granted by law, including recovery of
damages, will be entitled to specific performance of its rights under this
Agreement and such Warrant Certificate. The Company and the Initial Holder agree
that monetary damages would not be adequate compensation for any loss incurred
by reason of a breach by it of any of the provisions of this Agreement or any
Warrant Certificate and hereby further agrees that, in the event of any action
for
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specific performance in respect of such breach, it shall waive the defense
that a remedy at law would be adequate.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the date first above written.
MIRAVANT MEDICAL TECHNOLOGIES
By: /s/ Gary S. Kledzik
------------------------------------
Title: Chief Executive Officer
PHARMACIA & UPJOHN TREASURY SERVICES AB
By: /s/ Mats Pettersson
------------------------------------
Title: Attorney-In-Fact
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EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT
BE SOLD OR OFFERED FOR SALE UNLESS REGISTERED PURSUANT TO
THERETO OR UNLESS AN EXEMPTION THEREFROM IS AVAILABLE.
WARRANTS TO PURCHASE COMMON STOCK
OF MIRAVANT MEDICAL TECHNOLOGIES
No._______ Certificate for ______ Warrants
This certifies that , or registered assigns, is the registered holder
of the number of Warrants set forth above. Each Warrant entitles the holder
thereof (a "Holder"), subject to the provisions contained herein and in the
Warrant Agreement referred to below, to purchase, from Miravant Medical
Technologies, a Delaware corporation (the "Company"), the number of shares of
the Company's common stock, par value $.01 per share (the "Common Stock"),
provided in the Warrant Agreement, at an exercise price of $__________ per
Warrant and subject to all of the terms and conditions set forth in the Warrant
Agreement. At the sole election of the Company, upon the exercise of any
Warrant, the Company may pay to the Holder a certain amount of cash, as provided
in the Warrant Agreement, in lieu of delivering the shares of Common Stock.
This Warrant Certificate is issued under and in accordance with the
Warrant Agreement, dated as of February 18, 1999 (the "Warrant Agreement"),
between the Company and Pharmacia & Upjohn Treasury Services AB (the "Initial
Holder"), and is subject to the terms and provisions contained in the Warrant
Agreement, to all of which terms and provisions the Holder of this Warrant
Certificate consents by acceptance hereof. The Warrant Agreement is hereby
incorporated herein by reference and made a part hereof. Reference is hereby
made to the Warrant Agreement for a full statement of the respective rights,
limitations of rights, duties, obligations and immunities thereunder of the
Company and the Holders of the Warrants.
This Warrant Certificate shall terminate and be void as of the Close of
Business on _________, 200__.
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As provided in the Warrant Agreement and subject to the terms and
conditions therein set forth, the Warrants shall be exercisable from time to
time on any Business Day ending on the Expiration Date.
The number of shares of Common Stock issuable, and the amount of cash
payable, upon the exercise of each Warrant are subject to adjustment as provided
in the Warrant Agreement.
Upon payment therefor, all shares of Common Stock issued upon the
exercise of Warrants shall be duly authorized, validly issued, fully paid and
nonassessable free of preemptive rights and free from all taxes, liens, charges
and security interests with respect to the issuance thereof.
In order to exercise a Warrant, the registered holder hereof must
surrender this Warrant Certificate to the Registrar for the Warrants (the
"Registrar") with the form of election on the reverse hereof or attached hereto
duly executed, together with payment of the Exercise Price then in effect for
the share(s) of Common Stock as to which the Warrant(s) represented by this
Warrant Certificate are submitted for exercise, all subject to the terms and
conditions hereof and of the Warrant Agreement. Any such payment of the cash
Exercise Price shall be by certified or official bank check or wire transfer to
the Company of same day funds.
The Company shall pay all transfer, stamp and other similar taxes that
may be imposed in respect of the issuance or delivery of Warrants, or in respect
of the issuance or delivery of any securities upon exercise of Warrants. The
Company shall not be required, however, to pay any tax or other charge imposed
in connection with any transfer involved in the issuance of any certificate for
shares of Common Stock or other securities underlying the Warrants or payment of
cash to any Person other than the Holder of a Warrant Certificate surrendered
upon the exercise or purchase of a Warrant, and in case of such transfer or
payment, the Company shall not be required to issue any stock certificate or pay
any cash until such tax or other charge has been paid or it has been established
to the Company's reasonable satisfaction that no such tax or other charge is
due.
Subject to the Warrant Agreement, this Warrant Certificate and all
rights hereunder are transferable by the
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registered holder hereof, in whole or in part, on the Warrant Register of the
Company, upon surrender of this Warrant Certificate to the Registrar, duly
endorsed by, or accompanied by a written instrument of transfer in form
reasonably satisfactory to the Company duly executed by the Holder hereof or his
attorney duly authorized in writing. Upon any partial transfer, the Company will
issue and deliver to such holder a new Warrant Certificate or Certificates with
respect to any portion not so transferred.
No service charge shall be made for any transfer or exchange of this
Warrant Certificate, but the Company may require payment from the Holder of this
Warrant Certificate of a sum sufficient to cover any stamp or other governmental
charge or tax that may be imposed in connection with any such transfer or
exchange.
Each taker and holder of this Warrant Certificate, by taking or holding
the same, consents and agrees that this Warrant Certificate, when duly endorsed
in blank, shall be deemed negotiable and that when this Warrant Certificate
shall have been so endorsed, the holder hereof may be treated by the Company,
the Registrar and all other persons dealing with this Warrant Certificate as the
absolute owner hereof for any purpose and as the person entitled to exercise the
rights represented hereby, or to the transfer hereof on the register of the
Company maintained by the Registrar, any notice to the contrary notwithstanding,
but until such transfer on such register, the Company and the Registrar may
treat the registered Holder hereof as the owner for all purposes.
This Warrant Certificate and the Warrant Agreement are subject to
amendment as provided in the Warrant Agreement.
All terms used in this Warrant Certificate that are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
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Copies of the Warrant Agreement are on file at the office of the
Company and may be obtained by writing to the Company at the following address:
7408 Hollister Avenue, Santa Barbara, California 93117, Attention: Chief
Financial Officer.
Dated: __________.
MIRAVANT MEDICAL TECHNOLOGIES
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
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ELECTION TO EXERCISE
(To be executed only upon exercise of Warrant)
TO MIRAVANT MEDICAL TECHNOLOGIES:
The undersigned irrevocably exercises __________ of the Warrants for,
at your election, either (i) the Shares Amount or (ii) the Cash Amount, and
herewith makes payment of $__________ (such payment being by certified or
official bank check payable to the order of Miravant Medical Technologies), all
at the Exercise Price and on the terms and subject to the conditions specified
in the within Warrant Certificate and the Warrant Agreement therein referred to,
surrenders this Warrant Certificate and all right, title and interest therein to
Miravant Medical Technologies, Inc. and directs that any shares of Common Stock
deliverable upon the exercise of such Warrants be registered in the name and
delivered at the address specified on the following page, or any Cash Amount be
wired to the account specified on the following page.
Date:______________
____________________________________
(Signature of Holder)
____________________________________
(Street Address)
____________________________________
(City) (State) (Zip Code)
A-5
<PAGE>
Securities and/or check to be issued to:
Taxpayer identification number:
Name:
Street Address:
City, State and Zip Code:
Any unexercised Warrants evidenced by the within Warrant Certificate to be
issued to:
Taxpayer identification number:
Wire transfer instructions:
A-6
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered holder of the within
Warrant Certificate hereby sells, assigns, and transfers unto the Assignee(s)
named below (including the undersigned with respect to any Warrants constituting
a part of the Warrants evidenced by the within Warrant Certificate not being
assigned hereby) all of the rights of the undersigned under the within Warrant
Certificate, with respect to the number of Warrants set forth below:
Social Security
or Taxpayer
Identification
Names of Number of Number of
Assignees Address Assignee(s) Warrants
- --------- ------- --------------- ---------
and does hereby irrevocably constitute and appoint ___________ the undersigned's
attorney to make such transfer on the books of _____________ maintained for that
purpose, with full power of substitution in the premises.
Dated: __________.
____________________________________
(Signature of Holder)
____________________________________
(Street Address)
____________________________________
(City) (State) (Zip Code)
A-7
<PAGE>
EXHIBIT B
[BOARD RESOLUTIONS]
[To come]
B-1
EXHIBIT G
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of February 18, 1999 (this
"Agreement") by and between Miravant Medical Technologies, a Delaware
corporation (the "Company"), and Pharmacia & Upjohn, Inc., a Delaware
corporation (collectively with its Affiliates, the "Purchaser").
W I T N E S S E T H:
WHEREAS, in connection with the Equity Investment Agreement, of even
date herewith, between the Company and the Purchaser (the "Equity Investment
Agreement") and the Warrant Agreement, of even date herewith, between the
Company and the Purchaser (the "Warrant Agreement" and, together with the Equity
Investment Agreement, the "Purchase Agreements"), the Company has agreed, upon
the terms and subject to the conditions of said Purchase Agreements, to issue
and sell to the Purchaser shares of common stock of the Company, par value $.01
per share (the "Common Stock") and warrants to purchase Common Stock, the shares
of Common Stock and the shares of Common Stock issuable upon exercise of the
Warrants being collectively referred to herein as the "Securities"; and
WHEREAS, to induce the Purchaser to execute and deliver the Purchase
Agreements, the Company has agreed to provide certain registration rights under
the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute (collectively, the "Securities
Act"), and applicable state securities laws with respect to the Securities.
NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Purchaser hereby agree as follows:
<PAGE>
ARTICLE I
Definitions
Section 1.01. Definitions. Capitalized terms used herein shall have the
respective meanings set forth in the Purchase Agreement. As used in this
Agreement, the following terms shall have the following meanings:
"Affiliate" means any other Person directly or indirectly controlling,
controlled by, or under common control with, that Person.
"Commission" means the Securities and Exchange Commission.
"Person" means and includes natural persons, corporations, limited
liability companies, limited partnerships, general partnerships, joint stock
companies, joint ventures, associations, companies, trusts or other
organizations, whether or not legal entities, and governments and agencies and
political subdivisions thereof.
"Qualified Public Offering" means an underwritten registered public
offering of equity securities of the Company, which offering yields minimum
gross proceeds of US$20,000,000.
"1933 Act" means the Securities Act of 1933, as amended and as it may
be amended from time to time, including the rules and regulations thereunder.
"1934 Act" means the Securities Exchange Act of 1934, as amended and as
it may be amended from time to time, including the rules and regulations
thereunder.
ARTICLE II
Registration Rights
Section 2.01. Demand Rights. (a) Upon written demand of holders of a
majority of the Securities, the Company shall prepare and file a registration
statement under the 1933 Act covering an offering of such number of Securities
as shall have been requested by such holder(s) in such demand, and shall use its
diligent efforts to cause such registration statement to become effective, all
in
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<PAGE>
accordance with the provisions of this Agreement; provided, that if the
Company's Board of Directors determines in good faith that it would be seriously
detrimental to the Company to file such a registration statement at the time of
such demand, the Company shall have the right to defer filing such registration
statement for 120 days. The Company shall only be required to cause up to three
(3) registration statements to become effective under this Section 2.01.
(b) Whenever the Company shall have received a demand pursuant to this
Section 2.01 to effect the registration of any Securities, the Company shall
promptly give written notice of such proposed registration to all other holders
of Securities. Any such holder may, within 30 days after receipt of such notice,
request in writing that all of such holder's Securities, or any portion thereof
designated by such holder, be included in the offering.
(c) The Company shall proceed as expeditiously as possible after
receipt of a demand pursuant to this Section 2.01 to file a registration
statement and use its best efforts to effect, within 120 days after the giving
of such written demand (or, in the case of a demand made within 60 days prior to
the end of the Company's then fiscal year, within 210 days after the giving of
such written demand) the registration of an offering under the 1933 Act. Such
offering shall include:
(i) the Securities specified in the demand given pursuant
to Section 2.01(a); and
(ii) all other Securities that the holders thereof have
requested be included in the offering pursuant to Section 2.01(b);
all to the extent required to permit the holders of the Securities to dispose of
such Securities in compliance with applicable law. Unless otherwise recommended
by the managing underwriter to facilitate such offering, the Company shall have
the right to include in such offering authorized but unissued shares of its
Common Stock and shares of its Common Stock held in its treasury that together
constitute no more than 20% of the aggregate number of Securities to be offered.
No other outstanding securities of the Company shall be included in such
registration statement unless, and then only to the extent that, in the opinion
of the representative of the
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<PAGE>
underwriters participating in the sale and distribution of the shares of Common
Stock covered by such registration statement, such other outstanding securities
may be included in such registration statement and sold without adversely
affecting the sale of Securities otherwise included therein. The Purchaser shall
select the representative, if any, of the underwriters to be engaged in
connection with any such registration, subject to the consent of the Company,
which shall not unreasonably be withheld or delayed.
Section 2.02. Piggyback Rights. (a) If at any time the Company shall
propose to register any of its shares for sale or disposition, for its own
account for cash under the 1933 Act in a Qualified Public Offering (including,
for this purpose, a registration effected by the Company for stockholders other
than Purchaser) and if all of the Securities have not been registered under
Section 2.01 above, the Company shall:
(i) Promptly give to the Purchaser at least thirty (30) days'
written notice prior to the filing thereof (which shall include, if
then determined, the proposed date on which the registration statement
is to be filed, the proposed price and registration price per share,
the number of shares proposed to be included in such registration, the
identity of any proposed selling stockholders and a list of the
jurisdictions in which the Company intends to attempt to qualify such
securities under the applicable blue sky or other state securities
laws); and
(ii) Include in such registration (and any related
qualification under blue sky laws or other compliance), and in any
underwriting involved therein, a portion of the Securities which are
specified in a written request, or requests, made by the Purchaser
within ten (10) days after receipt of such written notice from the
Company by the Purchaser.
(b) The rights of the Purchaser to registration pursuant to this
section shall be conditioned upon the Purchaser's participation in any
underwriting relating to the Company's registered public offering. The Purchaser
shall (together with the Company) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected by the Company. The
Company will use its best efforts to include the Purchaser's Securities in
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<PAGE>
the Qualified Public Offering. Notwithstanding any provision of this section, if
the underwriter, in its sole discretion, determines that marketing factors
require a limitation of the number of securities to be underwritten, or that the
Qualified Public Offering be limited to shares offered by the Company only, the
underwriter may exclude some or all of the Purchaser's shares for which the
Purchaser seeks registration from inclusion in the registration and
underwriting, which reduction shall be pro rata among the Purchaser and any
other stockholder whose shares are sought to be included in the public offering.
Section 2.03. Termination of Registration Rights. The Company shall
have no obligation under Section 2.01 or 2.02 to register any Securities if the
Company shall deliver to the holders requesting such registration an opinion of
counsel reasonably satisfactory to such holders and their counsel to the effect
that the proposed sale or disposition for which registration was requested does
not require registration under the 1933 Act. The Company hereby agrees to
indemnify the holders of Securities, and each of them, against, and to hold them
harmless from, all damages, losses, liabilities (including liability for
rescission), costs and expenses that they may incur under the 1933 Act or
otherwise by reason of their proceeding in accordance with such opinion of
counsel.
Section 2.04. Actions to be Taken by the Company. If and whenever the
Company is obligated by the provisions of this Agreement to effect the
registration of any offering of Securities under the 1933 Act, as expeditiously
as possible the Company will, or will use its best efforts to, as the case may
be:
(a) Prepare and file with the Commission a registration statement with
respect to such Securities and cause such registration statement to become
effective; provided, however, that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company shall furnish
to the holders of the Securities covered by such registration statement, their
counsel and the representative of the underwriters, if any, copies of all such
documents proposed to be filed, which documents will be subject to the review of
such holders, their counsel and the representative of the underwriters, if any,
and the Company shall not file any registration statement or prospectus or any
amendments or supplements
-5-
<PAGE>
thereto to which the holders of a majority of the Securities covered by such
registration statement, their counsel, or the representative of the
underwriters, if any, shall reasonably object on a timely basis.
(b) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective
until the earlier of the sale of all Securities covered thereby or the
expiration of a period of 270 days after its effective date, and comply with the
provisions of the 1933 Act with respect to the disposition of all Securities
covered by such registration statement; provided, however, that if maintaining
the effectiveness of the registration statement would require the filing of a
post-effective amendment including new financial statements (other than
financial statements which the Company would be required to include in a current
report on Form 10-Q under Section 13 or 15(d) of the 1934 Act) the Company shall
be obligated hereunder to use its best efforts to maintain the effectiveness of
the registration statement for 90 days. In the event that any Securities
included in a registration statement subject to, or required by, this Agreement
remain unsold at the end of the period during which the Company is obligated to
use its best efforts to maintain the effectiveness of such registration
statement, the Company, if and when a further amendment or supplement would be
required to comply with Section 10 of the 1933 Act, may file a post-effective
amendment to the registration statement for the purpose of removing such shares
from registered status.
(c) Furnish to holders for whom Securities are registered or are to be
registered so many copies of a prospectus, including a preliminary prospectus,
in conformity with the requirements of the 1933 Act, and such other documents,
as such holders may reasonably request.
(d) Register or qualify the Securities covered by such registration
statement under such other securities or blue sky laws of such jurisdictions as
the holders for whom Securities are registered shall request, and do any and all
other acts and things that may be reasonably necessary or advisable to enable
such holders to consummate the disposition in such jurisdictions of such
Securities; provided, however, that the Company shall not be obligated, by
reason thereof, to qualify as a foreign corporation or
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<PAGE>
file any general consent to service of process under the laws of any such
jurisdiction or subject itself to taxation as doing business in any such
jurisdiction.
(e) Notify the holders for whom Securities are registered or are to be
registered and their counsel promptly after the Company shall receive notice
that any registration statement, supplement or amendment has become effective,
any registration statement is required to be amended or supplemented, or any
stop order with respect thereto has been issued.
(f) Enter into such agreements (including an underwriting agreement in
form, scope and substance as is customary in underwritten offerings) and take
all such other actions in connection therewith (including those reasonably
requested by the representative of the underwriters or the holders of a majority
of the Securities subject to the registration statement) in order to expedite or
facilitate the disposition of the Securities and in such connection, (i) make
such representations and warranties to the underwriters with respect to the
business of the Company and its subsidiaries, the registration statement, the
prospectus and the documents, if any, incorporated or deemed to be incorporated
by reference in the registration statement, in each case in form, substance and
scope as are customarily made by issuers to underwriters in underwritten
secondary offerings and confirm the same if and when requested; (ii) obtain
opinions of counsel to the Company and updates thereof, which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to the
representative of the underwriters, addressed to each of the underwriters,
covering the matters customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably requested by such
underwriters, including without limitation, the matters referred to in clause
(i) above; (iii) obtain "cold comfort" letters and updates thereof from the
independent certified public accountants of the Company (and, if necessary, any
other independent certified public accountants of any subsidiary of the Company
or of any business acquired by the Company for which financial statements and
financial data is or is required to be included in the registration statement)
addressed to each of the underwriters, such letters to be in customary form and
covering matters of the type customarily covered in "cold comfort" letters to
underwriters in connection with underwritten offerings; and (iv) deliver
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<PAGE>
such documents and certificates as may be requested by the representative of the
underwriters to evidence the continued validity of the representations and
warranties made pursuant to clause (i) above and to evidence compliance with any
customary conditions contained in the underwriting agreement or other agreement
entered into by the Company. The above shall be done at each closing under such
underwriting or similar agreement, or as and to the extent required thereunder.
(g) Make available for inspection by any underwriter and any attorney
or accountant retained by such underwriter, all financial and other records,
pertinent corporate documents and properties of the Company and its
Subsidiaries, and cause the officers, directors and employees of the Company and
its Subsidiaries to supply all information reasonably requested by any such
underwriter, attorney or accountant in connection with such registration
statement; provided, however, that any records, information or documents that
are designated by the Company in writing as confidential shall be kept
confidential by such Persons unless (i) disclosure of such records, information
or documents is required by court or administrative order, or (ii) disclosure of
such records, information or documents, in the opinion of counsel to such
Person, is required by law (including, without limitation, pursuant to the
requirements of the 1933 Act) or (iii) such records, information or documents
are in the public domain or otherwise publicly available.
Section 2.05. Costs and Expenses. The costs and expenses (other than
underwriting discounts or commissions and such fees for counsel, printing,
registration and other fees as state securities officials may require that the
holders of Securities pay) of all registrations and qualifications under the
1933 Act, and of all other actions that the Company is required to take or
effect pursuant to this Agreement, shall be paid by the Company (including,
without limitation, all registration and filing fees, printing expenses, costs
of special audits incident to or required by any such registration, fees and
disbursements of counsel for the Company and up to $20,000 of fees and
disbursements of one special counsel acting for the holders of Securities being
included in any registration) except that all such expenses in connection with
any amendment or supplement to the registration statement or the prospectus used
in connection therewith required to be filed more than
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<PAGE>
270 days after the date on which such registration statement becomes effective
under the 1933 Act because any holder has not effected the disposition of
Securities covered by such registration statement shall be borne pro rata by
such holder or holders and provided that all such costs and expenses shall be
borne pro rata by the Company and all holders if required by any state
securities commissioner as a condition to qualification of securities in such
jurisdiction.
Section 2.06. Indemnification. In the event of any registration under
the 1933 Act of any offering of Securities, the Company hereby agrees to
indemnify and hold harmless each holder of Securities and each other Person, if
any, who controls such holder (within the meaning of the 1933 Act) and each
other Person (including each underwriter, and each other Person, if any, who
controls such underwriter) who participates in the offering of such Securities
against any losses, claims, damages or liabilities ("Losses"), joint or several,
to which such holder or controlling Person or participating Person may become
subject under the 1933 Act or otherwise, insofar as such Losses (or proceedings
in respect thereof) arise out of or are based upon (a) any untrue statement or
alleged untrue statement of any material fact contained, on the effective date
thereof, in any registration statement under which Securities were registered
under the 1933 Act, in any preliminary prospectus or final prospectus contained
therein, or in any amendment or supplement thereto, (b) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading or (c) any violation or
alleged violation by the Company of the 1933 Act, the 1934 Act, any state
securities law or any rule or regulation promulgated under the 1933 Act, the
1934 Act or any state securities law, and will reimburse such holder and each
such controlling Person or participating Person for any legal or other expenses
reasonably incurred by such holder or such controlling Person or participating
Person in connection with investigating or defending any such Loss; provided
that the Company will not be liable in any such case to the extent that any such
Loss arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
such preliminary or final prospectus or such amendment or supplement in reliance
upon and in conformity with written information furnished by an instrument duly
executed by such
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<PAGE>
holder or such controlling or participating Person, as the case may be,
specifically for use in the preparation thereof. The Company shall also
indemnify underwriters participating in the distribution, their officers,
directors, agents and employees and each Person who controls such Persons
(within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange
Act) to the same extent as provided above with respect to the indemnification of
the holders of Securities.
Section 2.07. Additional Indemnification. In the event of any
registration under the 1933 Act of any offering of Securities, each holder of
such Securities hereby severally agrees to indemnify and hold harmless the
Company, each other holder and each other Person, if any, who controls the
Company within the meaning of the 1933 Act and each other Person (including each
underwriter, and each other Person, if any, who controls such underwriter) who
participates in the offering of such Securities against any Losses, joint or
several, to which the Company, such holder or controlling Person or
participating Person may become subject under the 1933 Act or otherwise, insofar
as such Losses (or proceedings in respect thereof) arise out of or are based
upon (a) any untrue statement or alleged untrue statement of any material fact
contained, on the effective date thereof, in any registration statement under
which an offering of such Securities was registered under the 1933 Act, in any
preliminary prospectus or final prospectus contained therein, or in any
amendment or supplement thereto, (b) the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statement therein not misleading or (c) any violation or alleged violation by
the Purchaser of the 1933 Act, the 1934 Act, any state securities law or any
rule or regulation promulgated under the 1933 Act, the 1934 Act or any state
securities law, and will reimburse the Company, such holder and each such
controlling Person or participating Person for any legal or other expenses
reasonably incurred by the Company, such holder or such controlling or
participating Person in connection with investigating or defending any such Loss
or proceeding; provided that such holder will be liable in any such case to the
extent, and only to the extent, that any such Loss arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, such preliminary or final
prospectus or such amendment or supplement in reliance
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<PAGE>
upon and in conformity with written information furnished in an instrument duly
executed by such holder specifically for use in the preparation thereof. The
Company shall be entitled to receive indemnities from underwriters participating
in the distribution to the same extent as provided above with respect to
information so furnished in writing by such Persons specifically for inclusion
in any registration statement or prospectus.
Section 2.08. Indemnification Procedures. If any action or proceeding
(including any governmental investigation or inquiry) shall be brought or any
claim shall be asserted against any Person entitled to indemnity hereunder (an
"indemnified party"), such indemnified party shall promptly notify the party
from which such indemnity is sought (the "indemnifying party") in writing, and
the indemnifying party shall assume and control the defense thereof, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses incurred in connection with the defense
thereof. Any such fees and expenses borne by the indemnified party (including
any fees and expenses incurred in connection with investigating or preparing to
defend such action or proceeding) shall be paid to the indemnified party, as
incurred, within 15 days of written notice thereof to the indemnifying party
(regardless of whether it is ultimately determined that an indemnified party is
not entitled to indemnification hereunder; provided the indemnified party shall
reimburse such fees and expenses if it is finally determined that such
indemnified party is not entitled to indemnity hereunder). Any such indemnified
party shall have the right to employ separate counsel in any such action, claim
or proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be the expenses of such indemnified party unless
(a) the indemnifying party has agreed to pay such fees and expenses, or (b) the
indemnifying party shall have failed to assume promptly the defense of such
action, claim or proceeding, or (c) the named parties to any such action, claim
or proceeding (including any impleaded parties) include both such indemnified
party and the indemnifying party, and such indemnified party shall have been
advised by counsel that there may be one or more legal defenses available to it
which are different from or in addition to those available to the indemnifying
party and that the assertion of such defenses would create a conflict of
interest such that counsel employed by the indemnified party
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<PAGE>
could not faithfully represent the indemnified party (in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such
action, claim or proceeding on behalf of such indemnified party; it being
understood, however, that the indemnifying party shall not, in connection with
any one such action, claim or proceeding or separate but substantially similar
or related actions, claims or proceedings in the same jurisdiction arising out
of the same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys (together with
appropriate local counsel) at any time for all such indemnified parties, unless
in the reasonable judgment of such indemnified party a conflict of interest may
exist between such indemnified party and any other of such indemnified parties
with respect to such action, claim or proceeding, in which event the
indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels). The indemnifying party shall not be liable for
any settlement of any such action or proceeding effected without its written
consent.
Section 2.09. Contribution. If the indemnification provided for in this
Agreement is unavailable to an indemnified party under Section 2.06 or 2.07
(other than by reason of exceptions provided in those Sections) in respect of
any Losses, then each applicable indemnifying party in lieu of indemnifying such
indemnified party shall contribute to the amount paid or payable by such
indemnified party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the indemnifying party and
indemnified parties in connection with the actions, statements or omissions
which resulted in such Losses as well as any other relevant equitable
considerations. The relative fault of such indemnifying party and the
indemnified party shall be determined by reference to, among other things,
whether any action in question, including any untrue statement or alleged untrue
statement of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information suppled by, such
indemnifying party or indemnified party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses
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<PAGE>
shall be deemed to include, subject to the limitations set forth in this Section
2.09, any legal or other fees or expenses reasonably incurred by such party in
connection with any action, suit, claim, investigation or proceeding. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.
Section 2.10. Form S-3. The Company represents and warrants that it
meets the requirements for the use of Form S-3 for registration of the sale by
the Purchaser of the Securities, and the Company shall file all reports required
to be filed by the Company with the SEC in a timely manner so as to maintain
such eligibility for the use of Form S-3.
ARTICLE III
Miscellaneous
SECTION 3.01. APPLICABLE LAW. THIS AGREEMENT AND ALL RIGHTS ARISING
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE.
SECTION 3.02. WAIVER OF JURY. THE COMPANY AND THE PURCHASER EACH HEREBY
WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT AND ANY RIGHT
ARISING HEREUNDER.
Section 3.03. Jurisdiction and Venue; Service of Process. (a) The
Company and the Purchaser each hereby irrevocably submits to the non-exclusive
jurisdiction of any state or federal court in the Borough of Manhattan, The City
of New York for the purpose of any suit, action, proceeding or judgment relating
to or arising out of this Agreement and any right arising hereunder, and to the
laying of venue in the Borough of Manhattan, The City of New York. The Company
and the Purchaser each hereby irrevocably waives, to the fullest extent
permitted by applicable law, any objection to the laying of the venue of any
such suit, action or
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proceeding brought in the aforesaid courts and hereby irrevocably waives any
claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
(b) The Company agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
Company at its address set forth in Section 3.06 or at such other address of
which the Purchaser shall have been notified pursuant thereto. The Company
further agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue any
other jurisdiction.
(c) Each of the Purchaser and the Company waives, to the maximum extent
not prohibited by law, any right it may have to claim or recover in any legal
action or proceeding referred to in this Section 3.03 any special, exemplary,
punitive or consequential damages. The waiver set forth in this Section 3.03(c)
shall terminate automatically upon the occurrence of a "Separation Event", as
defined in that certain stockholder rights protection plan of Pharmacia &
Upjohn, Inc. in effect on the date of this Agreement, as it may from time to
time be amended.
Section 3.04. Amendments and Waivers.
(a) Any provision of this Agreement may be amended, modified,
supplemented or waived, but only by a written amendment or supplement, or
written waiver, signed by the Company and the Purchaser.
(b) Except to the extent expressly set forth therein, any waiver shall
be effective only in the specific instance and for the specific purpose for
which such waiver is given.
Section 3.05. Cumulative Rights; No Waiver. Each and every right
granted to the Purchaser or allowed the Purchaser by law or equity, shall be
cumulative and not exclusive and may be exercised from time to time. No failure
on the part of the Purchaser to exercise, and no delay in exercising, any right
will operate as a waiver thereof, nor will any single or partial exercise by the
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Purchaser of any right preclude any other or future exercise thereof or the
exercise of any other right.
Section 3.06. Notices. (a) Any communication, demand or notice to be
given hereunder will be duly given when delivered in writing or by telecopy to a
party at its address as indicated below or such other address as such party may
specify in a notice to each other party hereto. A communication, demand or
notice given pursuant to this Section 3.06 shall be addressed:
If to the Company, to
Miravant Medical Technologies
7408 Hollister Avenue
Santa Barbara, California 93117
Telecopy: (805) 685-6038
Attention: Gary S. Kledzik
with a copy (which, in and of itself, shall not constitute
notice) to
Nida & Maloney PC
800 Anacapa Street
Santa Barbara, California 93101
Telecopy: (805) 568-1955
Attention: Joseph E. Nida
and
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304
Telecopy: (650) 493-6811
Attention: John T. Sheridan
-15-
<PAGE>
If to the Purchaser, to
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 470-8047
Attention: Treasurer
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4485
Attention: Senior Vice President
of Business Development
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4489
Attention: General Counsel
with a copy (which, in and of itself, shall not constitute
notice) to
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Telecopy: (212) 558-3588
Attention: Neil T. Anderson,
Matthew G. Hurd
and Martin J. Travers
(b) Unless otherwise provided to the contrary herein, any notice which
is required to be given in writing
-16-
<PAGE>
pursuant to the terms of this Agreement may be given by telecopy.
Section 3.07. Separability. In case any one or more of the provisions
contained in this Agreement shall be invalid, illegal or unenforceable in any
respect under any law, the validity, legality and enforceability of the
remaining provisions contained in this Agreement shall not in any way be
affected or impaired thereby.
Section 3.08. Persons Benefitting. This Agreement shall be binding upon
and inure to the benefit of the Purchaser and the Company, and their respective
successors, assigns, beneficiaries, executors and administrators. Nothing in
this Agreement is intended or shall be construed to confer upon any Person,
other than the Company and the Purchaser (and such successors, assigns,
beneficiaries, executors and administrators), any right, remedy or claim under
or by reason of this Agreement or any part hereof. This Agreement may not be
assigned without the written consent of the parties hereto, and any purported
assignment made in violation of this provision shall be null and void. The
provisions of the previous sentence notwithstanding, the Purchaser may assign
its rights and obligations under this letter agreement to any of its wholly
owned subsidiaries without the consent of the Company.
Section 3.09. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together constitute one and the same instrument.
Section 3.10. Headings. The descriptive headings of the several
Sections of this Agreement are inserted for convenience and shall not control or
affect the meaning or construction of any of the provisions hereof.
Section 3.11. Remedies. In the event of a breach by the Company or by
the Purchaser of any of their obligations under this Agreement, the Purchaser or
the Company, as the case may be, in addition to being entitled to exercise all
rights granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement. The Company and the
Purchaser agree that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific
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<PAGE>
performance in respect of such breach, it shall waive the defense that a remedy
at law would be adequate.
-18-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the date first above written.
MIRAVANT MEDICAL TECHNOLOGIES
By: /s/ Gary S. Kledzik
--------------------------------
Title: Chief Financial Officer
PHARMACIA & UPJOHN, INC.
By: /s/ Mats Pettersson
--------------------------------
Title: Senior Vice President
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EXHIBIT H
================================================================================
CREDIT AGREEMENT
dated as of
February 18, 1999
between
MIRAVANT MEDICAL TECHNOLOGIES
and
PHARMACIA & UPJOHN TREASURY SERVICES AB
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
Section 1.01. Definitions....................................................1
(a) Terms Generally................................................1
(b) Accounting Terms...............................................2
(c) Other Terms....................................................2
ARTICLE II
The Credit Facility
Section 2.01. Loans.........................................................15
Section 2.02. Borrowing Procedure...........................................16
Section 2.03. Repayment.....................................................16
Section 2.04. Prepayment....................................................17
ARTICLE III
Interest
Section 3.01. Interest on Loans.............................................18
Section 3.02. Interest on Overdue Amounts...................................19
Section 3.03. Day Counts....................................................19
Section 3.04. Maximum Interest Rate.........................................19
ARTICLE IV
Disbursement and Payment
Section 4.01. Method and Time of Payments...................................20
Section 4.02. Compensation for Losses.......................................20
Section 4.03. Withholding...................................................21
Section 4.04. Expenses; Indemnity...........................................21
Section 4.05. Survival......................................................22
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Page
ARTICLE V
Representations and Warranties
Section 5.01. Representations and Warranties................................23
(a) Subsidiaries..................................................23
(b) Good Standing and Power.......................................23
(c) Corporate Authority...........................................23
(d) Authorizations................................................23
(e) Binding Obligation............................................23
(f) Litigation....................................................24
(g) No Conflicts..................................................24
(h) Financial Condition...........................................24
(i) Taxes.........................................................25
(j) Use of Proceeds...............................................25
(k) Margin Regulations............................................25
(l) Compliance with ERISA.........................................25
(m) Not an Investment Company.....................................26
(n) Properties....................................................26
(o) Compliance with Laws and Charter Documents....................26
(p) Environmental Protection......................................27
(q) Insurance.....................................................28
(r) Adverse Contracts.............................................28
(s) Solvency......................................................28
(t) Disclosure....................................................28
Section 5.02. Survival......................................................29
ARTICLE VI
Conditions Precedent
Section 6.01. Conditions to the Availability of the Commitment..............29
(a) This Agreement................................................29
(b) Evidence of Corporate Action..................................29
(c) Opinions of Counsel...........................................30
(d) Representations and Warranties................................30
(e) Other Documents...............................................30
Section 6.02. Conditions to All Quarterly Loans.............................30
(a) Borrowing Request.............................................30
(b) Note..........................................................30
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<PAGE>
Page
(c) Warrant Certificate...........................................30
(d) No Default....................................................31
(e) Representations and Warranties; Covenants.....................31
Section 6.03. Satisfaction of Conditions Precedent..........................31
ARTICLE VII
Covenants
Section 7.01. Affirmative Covenants.........................................31
(a) Financial Statements; Compliance Certificates.................31
(b) Corporate Existence...........................................33
(c) Conduct of Business...........................................33
(d) Authorizations................................................33
(e) Taxes.........................................................34
(f) Insurance.....................................................34
(g) Inspection....................................................34
(h) Maintenance of Records........................................34
(i) Maintenance of Property.......................................35
(j) ERISA.........................................................35
(k) Notice of Defaults and Adverse Developments...................36
(l) Environmental Matters.........................................37
Section 7.02. Negative Covenants............................................37
(a) Mergers, Consolidations and Sales of Assets...................37
(b) Liens.........................................................38
(c) Indebtedness..................................................38
(d) Contingent Liabilities........................................38
(e) Loans and Investments.........................................39
(f) Capital Expenditures..........................................40
(g) Redemptions, etc..............................................41
(h) Dividends and Purchase of Stock...............................41
(i) Stock of Subsidiaries.........................................42
(j) Distributions by Subsidiaries.................................42
(k) Related Agreements............................................42
(l) Sale and Leaseback Transactions...............................43
(m) Transactions with Affiliates and Related Persons..............43
(n) Asset Dispositions............................................43
(o) Securities Offerings..........................................43
(p) Surplus Cashflows.............................................44
Section 7.03. Financial Covenants...........................................44
(a) Shareholders' Equity..........................................44
(b) Current Ratio.................................................44
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Page
(c) Minimum Operating Income......................................44
(d) Ophthalmology Expense.........................................44
ARTICLE VIII
Events of Default
Section 8.01. Events of Default.............................................45
(a) ..............................................................45
(b) ..............................................................45
(c) ..............................................................45
(d) ..............................................................45
(e) ..............................................................45
(f) ..............................................................45
(g) ..............................................................45
(h) ..............................................................46
(i) ..............................................................46
(j) ..............................................................46
(k) ..............................................................47
(l) ..............................................................47
Section 8.02. Assignments...................................................47
(b) ..............................................................48
Section 8.03. Certain Pledges...............................................48
ARTICLE IX
Miscellaneous
SECTION 9.01. APPLICABLE LAW................................................48
SECTION 9.02. WAIVER OF JURY................................................49
Section 9.03. Jurisdiction and Venue; Service of Process....................49
Section 9.04. Set-off.......................................................49
Section 9.05. Amendments and Waivers........................................50
Section 9.06. Cumulative Rights; No Waiver..................................50
Section 9.07. Notices.......................................................50
Section 9.08. Certain Acknowledgments.......................................52
Section 9.09. Separability..................................................52
Section 9.10. Parties in Interest...........................................53
Section 9.11. Execution in Counterparts.....................................53
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<PAGE>
SCHEDULES
Schedule 5.01(a) Subsidiaries of the Borrower
EXHIBITS
Exhibit A Form of Borrowing Request
Exhibit B Form of Note
Exhibit C Form of Opinion of Counsel for the Borrower to be
Delivered Upon Payment of Shares
Exhibit D Form of Opinion of Counsel for the Borrower to be
Delivered at the Effective Time
Exhibit E Form of Compliance Certificate
-v-
<PAGE>
CREDIT AGREEMENT, dated as of February 18, 1999, between Miravant
Medical Technologies, a Delaware corporation (the "Borrower") and Pharmacia &
Upjohn Treasury Services AB, a Swedish corporation (the "Lender").
W I T N E S S E T H :
WHEREAS, the Borrower has requested the Lender to commit to lend to the
Borrower, for general corporate purposes, an aggregate amount not to exceed
$22,500,000, in the form of up to six term loans, with not more than one such
term loan to be made in each of the six calendar quarters between January 1,
1999 and June 30, 2000; and
WHEREAS, the Lender is willing to make such loans, and the additional
loans described in Section 3.01(b) hereof, on the terms and conditions provided
herein;
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
Definitions
Section 1.01. Definitions.
(a) Terms Generally. The definitions ascribed to terms in this
Agreement apply equally to both the singular and plural forms of such terms.
Whenever the context may require, any pronoun shall be deemed to include the
corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be interpreted as if followed by the phrase
"without limitation". The phrase "individually or in the aggregate" shall be
deemed general in scope and not to refer to any specific Section or clause of
this Agreement. All references herein to the Preamble, Recitals, Articles,
Sections, Exhibits and Schedules shall be deemed references to the Preamble and
Recitals, Articles and Sections of, and Exhibits and Schedules to, this
Agreement unless the context shall otherwise require. The table of contents,
headings and captions herein shall not be given effect in interpreting or
construing the provisions of this Agreement. Except as otherwise expressly
provided herein, all references to "dollars" or "$" shall be deemed references
to the lawful money of the United States of America.
<PAGE>
(b) Accounting Terms. Except as otherwise expressly provided herein,
the term "consolidated" and all other terms of an accounting nature shall be
interpreted and construed in accordance with GAAP, as in effect from time to
time; provided, however, that, for purposes of determining compliance with any
covenant set forth in Article VII, such terms shall be construed in accordance
with GAAP as in effect on the date of this Agreement, applied on a basis
consistent with the construction thereof applied in preparing the Borrower's
audited financial statements referred to in Section 5.01(h).
(c) Other Terms. The following terms have the meanings ascribed to them
below or in the Sections of this Agreement indicated below:
"Additional Loans" means, collectively, Loans made pursuant to Section
3.01(b).
"Affiliate" means, with respect to any Person, any other Person that
controls, is controlled by, or is under common control with, such Person.
"Agreement" means this credit agreement, as it may be amended, modified
or supplemented from time to time.
"Approved Subsidiary" has the meaning assigned to such term in Section
8.02(a).
"Asset Disposition" by any Person means any transfer, conveyance, sale,
lease or other disposition by such Person or any of its Subsidiaries (including
a consolidation or merger or other sale of any such Subsidiary with, into or to
another Person in a transaction in which such Subsidiary ceases to be a
Subsidiary, but excluding a disposition by a Subsidiary of such Person to such
Person or a Wholly Owned Subsidiary of such Person or by such Person to a Wholly
Owned Subsidiary of such Person) of (i) shares of capital stock (other than
directors' qualifying shares) or other ownership interests of a Subsidiary of
such Person, (ii) substantially all of the assets of such Person or any of its
Subsidiaries representing a division or line of business or (iii) other assets
or rights of such Person or any of its Subsidiaries transferred, conveyed, sold,
leased or disposed of on or subsequent to the date of this Agreement for cash
consideration not in excess of, and having a book value or fair market value not
in excess of, $1,000,000 in the aggregate.
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<PAGE>
"Assignee" has the meaning assigned to such term in Section 8.02(a).
"Average Price" means the average of the Closing Prices of the Common
Stock for the 10 Trading Days immediately preceding the Maturity Date.
"Base Rate" means, for any day, a rate per annum equal to the rate of
interest from time to time publicly announced by Citibank, N.A. in The City of
New York as its prime commercial loan rate in effect on such day. The Base Rate
shall change as and when the foregoing rate shall change. Any change in the Base
Rate shall become effective as of the opening of business on the day of such
change.
"Board of Directors" means the board of directors of the Borrower.
"Borrower" has the meaning assigned to such term in the Preamble.
"Borrowing Amount" has the meaning set forth in Section 2.02.
"Borrowing Date" means, with respect to any Quarterly Loan, the
Business Day set forth in the relevant Borrowing Request as the date upon which
the Borrower desires to borrow such Quarterly Loan; provided, however, that such
Borrowing Date shall be not fewer than 10 Business Days and not more than 20
Business Days following the Lender's receipt of such Borrowing Request; and
provided, further, that the Borrowing Date with respect to any Loan for the
Quarter consisting of January, February and March, 1999 may be any Business Day
not fewer than five Business Days and not more than ten Business Days following
Lender's receipt of the Borrowing Request relating to such Loan.
"Borrowing Request" means a request by the Borrower for a Quarterly
Loan, which shall specify (i) the requested Borrowing Date, (ii) the Borrowing
Amount for such Quarterly Loan, and (iii) a calculation of the Exercise Price of
the related Warrants.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in The City of New York or in Los Angeles,
California, are authorized by law to close.
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<PAGE>
"Capital Expenditures" means, for any period, the aggregate of all
expenditures (whether paid in cash or accrued as liabilities and including that
portion of Capital Lease Obligations that is capitalized on the consolidated
balance sheet of the Borrower and its Subsidiaries) by the Borrower and its
Subsidiaries during such period that are included in the property, plant or
equipment reflected in the consolidated balance sheet of the Borrower and its
Subsidiaries.
"Capital Lease Obligations" means, with respect to any Person, the
obligation of such Person to pay rent or other amounts under any lease with
respect to any property (whether real, personal or mixed) acquired or leased by
such Person that is required by GAAP to be accounted for as a liability on a
consolidated balance sheet of such Person.
"Closing Price" means the last reported sale price regular way on the
day in question or, in case no such sale takes place on such day, the reported
closing bid price regular way of the Common Stock, in each case on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading, or, if not listed or admitted to trading on any national securities
exchange, the closing bid price of the Common Stock on the Nasdaq National
Market. In the case of a closing price of Common Stock on the Nasdaq National
Market, such price shall mean the closing price reported in the New York City
edition of The Wall Street Journal or, if not so reported, another authoritative
source.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Common Stock" means the common stock, par value $.01 per share, of the
Company and any other stock of the Borrower into which such common stock may be
converted or reclassified (other than stock of the Borrower into which unissued
Common Stock has been reclassified) or that may be issued in respect of, in
exchange for, or in substitution of, such common stock by reason of any stock
splits, stock dividends, distributions, mergers, consolidations,
recapitalizations or other like events.
"Credit Documents" means, collectively, this Agreement; all of the
Notes; that certain Security Agreement, of even date herewith, between the
Borrower, as debtor, and the Lender, as secured party; and any documents
executed and delivered, or filings made, pursuant to or in connection with such
Security Agreement, including any financing statements filed by the Lender
-4-
<PAGE>
pursuant to the Uniform Commercial Code and any filings made by the Lender with
the Patent and Trademark Office.
"Current Assets" means, at any date of determination, consolidated
current assets of the Borrower and its Subsidiaries.
"Current Liabilities" means, at any date of determination, consolidated
current liabilities of the Borrower and its Subsidiaries, less the amount of the
current portion of, and any accrued interest on, Indebtedness of the Borrower
and its Subsidiaries.
"Default" means any event or circumstance which, with the giving of
notice or the passage of time, or both, would be an Event of Default.
"Disclosure Package" has the meaning assigned to such term in Section
5.01(h).
"EBITDA" means, for any period, the sum of (i) consolidated net income
of the Borrower and its Subsidiaries for such period, adjusted to exclude
non-recurring gains and losses on unusual items and (ii) consolidated income
taxes, interest income, Interest Expense, depreciation, and amortization
(including, without limitation, amortization associated with goodwill, deferred
debt expenses, restricted stock and option costs and non-competition agreements)
of the Borrower and its Subsidiaries for such period.
"Effective Time" has the meaning assigned to such term in Section 6.01.
"Environmental Claim" means any claim, assertion, demand, notice of
violation, suit, administrative or judicial proceeding, regulatory action,
investigation, information request or order involving any hazardous substance,
Environmental Law, noise or odor pollution or any injury or threat of injury to
human health, property or the environment.
"Environmental Law" means any federal, state, local or foreign statute
or common law, regulation, order, decree, opinion or agency requirement as now
in effect or hereinafter adopted relating to (i) the handling, use, presence,
disposal or release of any hazardous substance or (ii) the protection,
preservation or restoration of the environment, natural resources or human
health or safety.
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<PAGE>
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Group" means the Borrower and all members of a controlled group
of corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, are treated as a single
employer under Section 414 of the Code or are considered to be one employer
under Section 4001 of ERISA.
"Event of Default" has the meaning assigned to such term in Section
8.01.
"Excluded Taxes" means all present and future taxes, levies, imposts,
duties, deductions, withholdings, fees, liabilities and similar charges imposed
on or measured by the overall net income of the Lender (or any office, branch or
Subsidiary of the Lender) or any franchise taxes, taxes on doing business or
taxes measured by capital or net worth imposed on the Lender (or any office,
branch or Subsidiary of the Lender), in each case imposed by the United States
of America or any political subdivision or taxing authority thereof or therein,
or taxes on or measured by the overall net income of any office, branch or
Subsidiary of the Lender or any taxes, levies, imposts, duties, deductions,
withholdings, fees, liabilities and similar changes imposed by any foreign
country or subdivision thereof.
"Exercise Price" has the meaning assigned to such term in the Warrant
Agreement.
"External Scaleup Costs" means the costs incurred by the Borrower
associated with the development of the scale-up of raw materials, the active
pharmaceutical ingredient and final dose formulation necessary to permit the
Product (as defined in that certain Amended and Restated Ophthalmology
Development & License Agreement between the Borrower and an affiliate of the
Lender) to be manufactured by an entity other than the Borrower. Such costs
include, but are not limited to, the costs of development work performed, raw
materials used in development and stability and equipment needed.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System (or any successor Governmental Authority).
"GAAP" means generally accepted accounting principles, as set forth in
the opinions and pronouncements of the Accounting
-6-
<PAGE>
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entities as may be approved by a significant
segment of the accounting profession of the United States of America.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guaranty" means, with respect to any Person, any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, and including any
obligation of such Person, (i) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or to purchase (or to advance
or supply funds for the purchase of) any security for the payment of such
Indebtedness, (ii) to purchase property, securities or services for the purpose
of assuring the holder of such Indebtedness of the payment of such Indebtedness
or (iii) to maintain working capital, equity capital or the financial condition
or liquidity of the primary obligor so as to enable the primary obligor to pay
such Indebtedness. The terms "Guaranteed", "Guaranteeing" and "Guarantor" shall
have corresponding meanings.
"Hazardous Substance" means any substance, in any concentration or
mixture, that is (i) listed, classified or regulated pursuant to any
Environmental Law, (ii) petroleum product or by-product, asbestos containing
material, polychlorinated biphenyls, radioactive material or radon or (iii) any
waste or other substance regulated by any Governmental Authority or any
Environmental Law.
"Indebtedness" means, with respect to any Person, (i) all obligations
of such Person for borrowed money or for the deferred purchase price of property
or services (including all obligations, contingent or otherwise, of such Person
in connection with letters of credit, bankers' acceptances, Interest Rate
Protection Agreements or other similar instruments, including currency swaps)
other than indebtedness to trade creditors and service providers incurred in the
ordinary course of business and payable on usual and customary terms, (ii) all
obligations of such Person evidenced by bonds, notes, debentures
-7-
<PAGE>
or other similar instruments, (iii) all indebtedness created or arising under
any conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the remedies available to the seller or
lender under such agreement are limited to repossession or sale of such
property), (iv) all Capital Lease Obligations of such Person, (v) all
obligations of the types described in clauses (i), (ii), (iii) or (iv) above
secured by (or for which the obligee has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in any property (including
accounts, contract rights and other intangibles) owned by such Person (up to the
value of such property), even though such Person has not assumed or become
liable for the payment of such Indebtedness, (vi) all preferred stock issued by
such Person or any Subsidiary of such Person, valued at the greater of its
voluntary or involuntary liquidation preference plus accrued and unpaid
dividends, (vii) all Indebtedness of others Guaranteed by such Person and (viii)
all Indebtedness of any partnership of which such Person is a general partner.
"Indemnitee" has the meaning assigned to such term in Section 4.04(b).
"Interest Expense" means, for any period, consolidated interest expense
(including that attributable to Capital Lease Obligations) whether paid or
accrued, of the Borrower and its Subsidiaries with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries, including all commissions,
discounts and other fees and charges owed with respect to letter of credit and
bankers' acceptance financing and net costs under Interest Rate Protection
Agreements.
"Interest Rate Protection Agreement" means any interest rate swap
agreement, interest rate cap agreement or similar hedging arrangement used by a
Person to fix or cap a floating rate of interest on Indebtedness to a negotiated
maximum rate or amount.
"Investment" by any Person means any direct or indirect loan, advance
or other extension of credit or capital contribution to (by means of transfers
of cash or other property to others or payments for property or services for the
account or use of others, or otherwise), or purchase or acquisition of capital
stock, bonds, notes, debentures or other securities or evidence of Indebtedness
or other obligations of or issued by any other Person.
-8-
<PAGE>
"Key Agreements" means, collectively, the License Agreement, effective
July 1, 1989, between the University of Toledo, the Medical College of Ohio, St.
Vincent Medical Center and the Borrower, as amended prior to the date hereof,
and the Development and Distribution Agreement, dated May 28, 1996, between
Iridex Corporation and the Borrower, as amended prior to the date hereof.
"Lender" has the meaning assigned to such term in the Preamble.
"Lien" means, with respect to any asset of a Person, (i) any mortgage,
deed of trust, lien, pledge, encumbrance, charge or security interest in or on
such asset, (ii) the interest of a vendor or lessor under any conditional sale
agreement, capital lease or title retention agreement relating to such asset,
and (iii) in the case of securities, any purchase option, call or similar right
of any other Person with respect to such securities.
"Loans" means, collectively, the Quarterly Loans and the Additional
Loans.
"Material Adverse Effect" means any material and adverse effect on (i)
the consolidated business, properties, condition (financial or otherwise) or
operations, present or prospective, of the Borrower and its Subsidiaries, (ii)
the ability of the Borrower timely to perform any of its material obligations,
or of the Lender to exercise any remedy, under any Credit Document or (iii) the
legality, validity, binding nature or enforceability of any Credit Document.
"Maturity Date" means the fifth anniversary of the Borrowing Date for
the first Loan made pursuant to this Agreement.
"Maximum Quarterly Amount" means, (i) for the Quarter comprising
January, February and March, 1999, $3,750,000, and (ii) for any other Quarter
(the "Reference Quarter"), the sum of $3,750,000 plus either (A) if and only if
no Quarterly Loan was made in the Quarter immediately preceding the Reference
Quarter or the principal amount of the Quarterly Loan made in the Quarter
immediately preceding the Reference Quarter was less than $3,750,000, then the
amount equal to the amount by which $3,750,000 exceeds the principal amount of
the Quarterly Loan, if any, made in the Quarter immediately preceding the
Reference Quarter, or (B) if and only if the principal amount of the
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<PAGE>
Quarterly Loan made in the Quarter immediately preceding the Reference Quarter
was equal to or greater than $3,750,000, then zero.
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA to which any member of the ERISA Group is making or accruing
an obligation to make contributions or has within the preceding five plan years
made or accrued contributions.
"Net Available Asset Disposition Proceeds" means, with respect to any
Asset Disposition by any Person, all cash or readily marketable cash equivalents
received (including by way of sale or discounting of a note, instalment
receivable or other receivable, but excluding any other consideration received
in the form of assumption by the acquiree of Indebtedness or other obligations
relating to such properties or assets or received in any other noncash form)
therefrom by such Person, net of (i) all legal, title and recording tax
expenses, commissions and other fees and expenses incurred and all federal,
state, provincial, foreign and local taxes required to be accrued as a liability
as a consequence of such Asset Disposition, (ii) all payments made by such
Person or its Subsidiaries on any Indebtedness which is secured by such assets
in accordance with the terms of any Lien upon or with respect to such assets or
which must by the terms of such Lien, or in order to obtain a necessary consent
to such Asset Disposition or by applicable law be repaid out of the proceeds
from such Asset Disposition, and (iii) all distributions and other payments made
to minority interest holders in Subsidiaries of such Person or joint ventures
as a result of such Asset Disposition.
"Net Available Securities Offering Proceeds" means, with respect to any
offer or sale of securities by any Person, all cash or readily marketable cash
equivalents received therefrom by such Person, net of all underwriting discounts
and commissions, SEC filing fees, legal fees and disbursements, printing fees,
fees of national securities exchanges or the Nasdaq National Market and auditing
fees incurred by such Person in connection with such offer or sale.
"New Site" has the meaning assigned to such term in Section
7.02(e)(ix).
"Note" means a promissory note of the Borrower in the form set forth in
Exhibit B, executed and delivered in accordance
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with Section 2.02, 3.01(b) or 6.02(b) in order to evidence a
Loan.
"Operating Income" of any Person means, for any period, the
consolidated operating income (or loss) of such Person for such period
determined on a consolidated basis in accordance with generally accepted
accounting principles; provided that there shall be excluded therefrom (a)
noncash expense items, including but not limited to depreciation, amortization,
noncash compensation costs and reserves, (b) the operating income (or loss) of
any Person acquired by such Person or a Subsidiary of such Person in a
pooling-of-interests transaction for any period prior to the date of such
transaction, (c) the operating income (but not operating loss) of any Subsidiary
of such Person which is subject to restrictions which prevent the payment of
dividends or the making of distributions to such Person to the extent of such
restrictions, (d) the operating income (or loss) of any Person that is not a
Subsidiary of such Person except to the extent of the amount of dividends or
other distributions actually paid to such Person by such other Person during
such period, (e) gains or losses on Asset Dispositions by such Person or its
Subsidiaries and (f) all extraordinary gains and extraordinary losses.
"Ophthalmology Expense" means, for any period, the direct and indirect
costs incurred by the Company associated with the field of ophthalmology for
research, pharmaceutical, device and manufacturing development and preclinical
and clinical costs, including, (but not limited to) general and administrative
costs, internal scale-up costs, preclinical costs as required for NDA filing,
clinical and regulatory costs, drug and device development and manufacturing
costs and consultants, but excluding External Scaleup Costs.
"PBGC" means the Pension Benefit Guaranty Corporation (or any successor
Governmental Authority).
"Pension Plan" means a Plan that (i) is an employee pension benefit
plan, as defined in Section 3(3) of ERISA (other than a Multiemployer Plan) and
(ii) is subject to the provisions of Title IV of ERISA or is subject to the
minimum funding standards under Section 412 of the Code.
"Permitted Liens" means, collectively, the following: (i) Liens for
taxes, assessments or charges not yet due or that are being contested in good
faith by appropriate proceedings and (unless the amount thereof is not material
to the Borrower's
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consolidated financial condition) for which adequate reserves are being
maintained (in accordance with GAAP); (ii) deposits or pledges to secure
obligations under workers' compensation, social security or similar laws, or
under unemployment insurance; (iii) deposits or pledges to secure bids, tenders,
contracts (other than contracts constituting Indebtedness), leases, statutory
obligations, surety and appeal bonds and other obligations of like nature
arising in the ordinary course of business; (iv) mechanics', workers',
materialmen's or similar Liens arising in the ordinary course of business with
respect to obligations which are not overdue for a period of more than 30 days
or which are being contested in good faith by appropriate proceedings; (v) Liens
securing judgments in an amount and for a period not constituting an Event of
Default under Section 8.01(i); (vi) minor imperfections of title on real estate
that do not interfere materially with the use of such property or render title
unmarketable; (vii) any Lien upon or in any property hereafter acquired by the
Borrower or a Subsidiary of the Borrower, provided that such Lien is created
contemporaneously with such acquisition to secure or provide for the payment or
financing of any part of the cost (including construction costs) thereof, and
provided, further, that such Lien attaches only to the property so acquired and
fixed improvements thereon, accessions thereto, replacements and proceeds
thereof, and substitutions therefor; (viii) Liens existing on the date hereof;
(ix) Liens on equipment leased by the Borrower or any Subsidiary of the Borrower
pursuant to a capital lease in the ordinary course of business (including
replacements and proceeds thereof, substitutions therefor and accessions
thereto) incurred solely for the purpose of financing the lease of such
equipment; (x) leases or subleases granted to others in the ordinary course of
Borrower's or its Subsidiary's business not interfering in any material respect
with the business of Borrower and its Subsidiaries taken as a whole, and any
interest or title of a lessor under any lease; (xi) Liens on assets that existed
at the time such assets were acquired by Borrower or any Subsidiary (including
Liens on assets of any corporation that existed at the time it became or becomes
a Subsidiary of the Borrower); provided such Liens were not granted in
contemplation of or in connection with the acquisition of such asset by Borrower
or any such Subsidiary; (xii) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payments of customs duties in connection
with the importation of goods; (xiii) Liens which constitute rights of set-off
of a customary nature or banker's Liens with respect to amounts on deposit,
whether arising by operation of law or by contract, in connection with
arrangement entered into with banks in the ordinary course
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of business; (xiv) Liens on insurance proceeds in favor of insurance companies
granted solely as security for financed premiums; and (xv) any Lien renewing,
extending or refinancing a Lien permitted by the foregoing, provided that the
principal amount secured is not increased and the Lien is not extended to other
property (other than by a substitution of like property).
"Person" means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
institution, public benefit corporation, entity or government (whether Federal,
state, county, city, municipal or otherwise, including any instrumentality,
division, agency, body or department thereof).
"Plan" means an employee benefit plan as defined in Section 3(3) of
ERISA (other than a Multiemployer Plan) which is maintained or contributed to by
the Borrower or any member of the ERISA Group.
"Quarter" means each of the six calendar quarters consisting of
January, February and March, 1999; April, May and June, 1999; July, August and
September, 1999; October, November and December, 1999; January, February and
March, 2000; and April, May and June, 2000.
"Quarterly Loan" has the meaning assigned to such term in Section 2.01.
"Related Person" of any Person means, without limitation, any officer
or director of such Person or any other Person owning 5% or more of the
outstanding common stock of such Person or 5% or more of the Voting Stock of
such Person. For purpose of this Agreement, the Lender and its Affiliates shall
not be deemed to be Related Persons of the Borrower or any of its Subsidiaries.
"Repayment Shares" has the meaning assigned to such term in Section
2.03(b).
"Responsible Officer" means the chief executive officer, president,
chief financial officer, chief accounting officer or treasurer of the Borrower.
"Sale and Leaseback Transaction" of any Person means an arrangement
with any lender or investor or to which such lender or investor is a party
providing for the leasing by such Person of any property or asset of such Person
which has been or is
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being sold or transferred by such Person after the acquisition thereof or the
completion of construction or commencement of operation thereof to such lender
or investor or to any person to whom funds have been or are to be advanced by
such lender or investor on the security of such property or asset.
"SEC" means the Securities and Exchange Commission (or any successor
Governmental Authority).
"Share Repayment Amount" has the meaning assigned to such term in
Section 2.03(b).
"Shareholders' Equity" means, as of any date of determination, the
total consolidated shareholders' equity (determined without duplication) of the
Borrower and its Subsidiaries at such date.
"Solvent" means, with respect to a Person and a specified date of
determination, that at such date:
(a) the present fair saleable value of such Person's assets is in
excess of the total amount of such Person's probable liabilities on its existing
debts and obligations (including contingent liabilities) as they become absolute
and matured;
(b) such Person is able to pay its debts as they become due; and
(c) such Person does not have unreasonably small capital to carry on
such Person's business as theretofore operated and all businesses in which such
Person then is about to engage.
"Subsidiary" means, at any time and with respect to any Person, any
other Person the shares of stock or other ownership interests of which having
ordinary voting power to elect a majority of the board of directors or other
matters of such Person are at the time owned, or the management or policies of
which is otherwise at the time controlled, directly or indirectly through one or
more intermediaries (including other Subsidiaries) or both, by such first
Person. Unless otherwise qualified or the context indicates clearly to the
contrary, all references to a "Subsidiary" or "Subsidiaries" in this Agreement
refer to a Subsidiary or Subsidiaries of the Borrower.
"Surplus" has the meaning assigned to such term in Section 7.02(p).
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"Taxes" has the meaning assigned to such term in Section 4.03.
"Trading Day" means a day on which the principal national securities
exchange on which the shares of Common Stock are listed or admitted to trading
is open for the transaction of business or, if the shares of Common Stock are
not listed or admitted to trading on any national securities exchange, a day on
which the Nasdaq National Market is open for the transaction of business.
"Voting Stock" of any Person means capital stock of such Person which
ordinarily has voting power for the election of directors (or persons performing
similar functions) of such Person.
"Warrant" has the meaning assigned to such term in the Warrant
Agreement.
"Warrant Agreement" means the Warrant Agreement, of even date herewith,
between the Borrower and the Lender.
"Warrant Certificate" has the meaning assigned to such term in the
Warrant Agreement.
"Warrant Number" means, with respect to any Quarterly Loan, a number of
Warrants equal to the product of (i) the Borrowing Amount for such Quarterly
Loan, divided by (ii) 62.50.
"Wholly Owned Subsidiary" means, at any time and with respect to any
Person, a Subsidiary, all the shares of stock of all classes of which (other
than directors' qualifying shares) or other ownership interests at the time are
owned directly or indirectly by such Person and/or one or more other Wholly
Owned Subsidiaries of such Person.
ARTICLE II
The Credit Facility
Section 2.01. Loans. Subject to the terms and conditions of this
Agreement, the Lender agrees to make a single term loan (each, a "Quarterly
Loan") in dollars to the Borrower not more than once in each Quarter in a
principal amount not to exceed the Maximum Quarterly Amount per Quarter. Each
Quarterly Loan shall be made on the applicable Borrowing Date only in a
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principal amount of $1,000,000 or an integral multiple of $250,000 in excess
thereof, but in no event greater than the Maximum Quarterly Amount for such
Quarter.
Section 2.02. Borrowing Procedure. In order to borrow a Quarterly Loan,
the Borrower shall deliver a Borrowing Request to the treasurer of Lender, no
later than 12:00 Noon, New York time, on the thirtieth Business Day of the
Quarter to which the Loan relates; provided, however, that any Borrowing Request
with respect to a Quarterly Loan for the Quarter consisting of January, February
and March, 1999 may be furnished to the Lender at any time no later than 12:00
Noon, New York time, on the fifteenth Business Day following the Effective Time.
Each Borrowing Request shall be accompanied by a duly executed Note in the form
of Exhibit B, dated as of the Borrowing Date and evidencing a loan in the
principal amount set forth in the Borrowing Request (the "Borrowing Amount",
which shall be $1,000,000 or an integral multiple of $250,000 in excess thereof
but shall not exceed the Maximum Quarterly Amount for such Quarter), and a duly
executed Warrant Certificate evidencing a number of Warrants equal to the
Warrant Number. Subject to satisfaction, or waiver by the Lender in writing, of
each of the applicable conditions precedent contained in Article VI, on the
applicable Borrowing Date the Lender shall make available to the Borrower the
Borrowing Amount.
Section 2.03. Repayment. (a) The aggregate outstanding principal of the
Loans shall be repaid in full, together with any accrued interest as of the date
of repayment, not later than the Maturity Date. Except as permitted by Section
2.03(b), such principal and interest shall be repaid in cash. Repaid Loans may
not be reborrowed.
(b) If and only if the Common Stock shall have been listed or admitted
to trading on a national securities exchange or quoted on the Nasdaq National
Market on each of the 180 calendar days preceding and including the Maturity
Date, then on, but not following, the Maturity Date, the Borrower may, at its
option, repay all or a portion of the aggregate principal of the Loans, together
with any accrued interest as of the Maturity Date, by delivering to the office
of the Lender theretofore designated in writing to the Borrower not later than
12:00 Noon, New York time, on the Maturity Date, (i) an unlegended certificate
for the number of shares of Common Stock (the "Repayment Shares") equal to the
product, rounded up to the nearest whole number, of (A) the portion of the
aggregate principal of the Loans to be repaid pursuant to this Section
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2.03(b), together with any accrued interest thereon as of the Maturity Date (the
"Share Repayment Amount"), divided by (B) the Average Price; (ii) an opinion of
counsel for the Borrower (which counsel shall be satisfactory to the Lender) in
the form of Exhibit C; (iii) evidence satisfactory to the Lender of the previous
expiration or termination of any waiting period (and any extension thereof)
applicable to the acquisition by the Lender of the Repayment Shares under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the
previous receipt of all governmental and contractual permits, consents and
approvals necessary in connection with such acquisition; (iv) evidence
satisfactory to the Lender of Borrower's compliance with Section 2.03(c); and
(v) a certified or official bank check in same day funds equal to the difference
of (A) the aggregate principal amount of the Loans, together with any accrued
interest as of the Maturity Date, minus (B) the Share Repayment Amount.
(c) The Borrower shall pay all transfer, stamp and other similar taxes
that may be imposed in respect of the issuance or delivery of the Repayment
Shares pursuant to Section 2.03(b) and any and all filing fees incurred by the
Lender pursuant to Section 2.03(b)(iv).
Section 2.04. Prepayment. The Borrower may prepay portions of the Loans
by giving notice to the treasurer of the Lender, by telephone, telecopy or in
writing, not later than 12:00 Noon (if not in writing, to be so confirmed not
later than 2:00 P.M.), New York time, on the Business Day preceding the proposed
date of prepayment. Each such prepayment shall be in an aggregate principal
amount of $[Confidential treatment requested] or integral multiples of
$[Confidential treatment requested] in excess thereof (or if the aggregate
amount of outstanding Loans is less than $[Confidential treatment requested],
then all of such lesser amount), together with accrued interest on the principal
being prepaid to the date of prepayment; provided, however, that in the case of
any prepayment pursuant to Section 7.02(n), 7.02(o) or 7.02(p), such prepayment
shall be in an aggregate principal amount equal to [Confidential treatment
requested]% of the Net Available Asset Disposition Proceeds, [Confidential
treatment requested]% of the Net Available Securities Offering Proceeds or
[Confidential treatment requested]% of the amount of the Surplus, as the case
may be, in any such case together with accrued interest on the principal being
repaid to the date of prepayment, up to but not in excess of the aggregate
principal amount of, and accrued interest on, the outstanding Loans. Each
partial prepayment shall be applied to the principal amount of the Loan or Loans
designated by the Lender in its sole discretion, and the Lender will provide
Borrower with reasonable notice concerning such designation. Prepaid Loans may
not be reborrowed.
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ARTICLE III
Interest
Section 3.01. Interest on Loans. (a) Each Loan shall bear interest from
the date made until the date repaid, payable pursuant to Section 3.01(b), at a
rate per annum equal to the Base Rate in effect from time to time, which rate
shall change as and when said Base Rate shall change.
(b) Interest on the Loans shall be payable in arrears on the last day
of each calendar quarter of each year (each such day, a "Quarterly Payment
Date"), commencing with the first such Quarterly Payment Date after the
Effective Date, and on the date such Loan is repaid or prepaid, in the manner
set forth in Section 4.01 or, if and only if permitted below, by the delivery of
a Note evidencing an additional loan made pursuant to this Agreement and having
a principal amount equal to the amount of such interest, as set forth below.
(i) On or prior to the fifth Business Day following each
Quarterly Payment Date prior to January 1, 2001, the Borrower shall
execute and deliver to the treasurer of the Lender a Note having a
principal amount equal to the aggregate amount of all interest on Loans
(including Additional Loans) payable on such Quarterly Payment Date.
Each such Note shall evidence an additional loan made pursuant to this
Agreement and shall bear interest in the manner and at the rate set
forth in Section 3.01(a), which interest shall be payable in the manner
set forth in this Section 3.01(b).
(ii) All interest on Loans (including Additional Loans)
payable on any Quarterly Payment Date subsequent to December 31, 2000
shall be paid in the manner set forth in Section 4.01; provided that if
and only if EBITDA for the calendar quarter ending on such Quarterly
Payment Date does not exceed the amount of such interest as is payable
on such Quarterly Payment Date, then, subject to Section 3.01(b)(iii),
on or prior to the fifth Business Day following such Quarterly Payment
Date, the Borrower shall execute and deliver to the treasurer of the
Lender a Note having a principal amount equal to the aggregate amount
of all interest on Loans (including Additional Loans) payable on such
Quarterly Payment Date. Each such Note shall evidence an additional
loan made pursuant to this Agreement
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and shall bear interest in the manner and at the rate set forth in
Section 3.01(a), which interest shall be payable in the manner set
forth in this Section 3.01(b).
(iii) The Borrower shall not be entitled to pay interest on
Loans in the manner set forth in Section 3.01(b)(ii) in respect of
interest payable on any of the four Quarterly Payment Dates immediately
following the closing of a primary offering or sale of securities by
the Borrower in which the Net Available Securities Offering Proceeds
from such offering or sale equals or exceeds $5,000,000.
(c) No Warrants shall be issuable in connection with any Additional
Loan.
Section 3.02. Interest on Overdue Amounts. All overdue amounts
(including principal, interest and fees) hereunder, and, during the continuance
of any Event of Default that shall have occurred, each Loan shall bear interest,
payable on demand, at a rate per annum equal to the sum of (i) 10% and (ii) the
rate of interest applicable to such Loan, changing as and when such rate shall
change.
Section 3.03. Day Counts. Interest on Loans shall be calculated on the
basis of (a) a 365- or, if applicable, a 366- day year for the actual number of
days elapsed.
Section 3.04. Maximum Interest Rate. (a) Nothing in this Agreement
shall require the Borrower to pay interest at a rate exceeding the maximum rate
permitted by applicable law.
(b) If the amount of interest payable to the Lender on any interest
payment date in respect of the immediately preceding interest computation
period, computed pursuant to this Article III, would exceed the maximum amount
permitted by applicable law to be charged by the Lender, the amount of interest
payable for its account on such interest payment date shall automatically be
reduced to such maximum permissible amount.
(c) If the amount of interest payable to the Lender in respect of any
interest computation period is reduced pursuant to Section 3.04(b) and the
amount of interest payable for its account in respect of any subsequent interest
computation period would be less than the maximum amount permitted by law to be
charged by the Lender, then the amount of interest payable in respect of such
subsequent interest computation period shall be
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automatically increased to such maximum permissible amount; provided that at no
time shall the aggregate amount by which interest paid to the Lender has been
increased pursuant to this Section 3.04(c) exceed the aggregate amount by which
interest paid to the Lender has theretofore been reduced pursuant to Section
3.04(b).
ARTICLE IV
Disbursement and Payment
Section 4.01. Method and Time of Payments. (a) Except as specifically
permitted by Section 3.01(b), and except in the case of payments pursuant to
Sections 3.02, 4.02, 4.03, 4.04 or payments otherwise specified as payable upon
demand, which payments shall be made forthwith upon written demand therefor, all
payments by the Borrower hereunder shall be made without setoff or counterclaim
to the Lender in dollars and in immediately available funds at the office of the
Lender theretofore designated in writing to the Borrower not later than 2:00
p.m., New York time, on the later of the date when due or the fifth Business Day
following the Borrower's receipt of an oral or written confirmation made in
response to the request contemplated by Section 4.01(c).
(b) Whenever any payment from the Borrower shall be due on a day that
is not a Business Day, the date of payment thereof shall be extended to the next
succeeding Business Day. If the date for any payment of principal is extended by
operation of law or otherwise, interest thereon shall be payable for such
extended time.
(c) Promptly upon receipt of a request by the Borrower therefor (which
request may be made by telephone to the treasurer or any assistant treasurer of
Pharmacia & Upjohn, Inc.) the Lender shall confirm the Lender's calculation of
the amount of any payment due on a particular date.
Section 4.02. Compensation for Losses. If the Borrower revokes any
Borrowing Request, then the Borrower shall reimburse the Lender, promptly upon
demand therefor, for all fees and costs actually incurred or paid by the Lender
to third parties in respect of funds obtained by the Lender for the purpose of
making or maintaining the related Loan, or any portion thereof. If requested by
the Borrower, Lender shall provide to
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the Borrower reasonable documentation concerning such fees and costs.
Section 4.03. Withholding. All payments under this Agreement and under
the Notes (including payments of principal and interest) shall be payable to the
Lender free and clear of any and all present and future taxes, levies, imposts,
duties, deductions, withholdings, fees, liabilities and similar charges other
than Excluded Taxes (collectively, "Taxes"). If any Taxes are required to be
withheld or deducted from any amount payable under this Agreement, then the
amount payable under this Agreement shall be increased to the amount which,
after deduction from such increased amount of all Taxes required to be withheld
or deducted therefrom, will yield to the Lender the amount stated to be payable
under this Agreement; provided, however, that amounts payable under this
Agreement shall not be increased in respect of any Taxes required to be withheld
or deducted solely as a consequence of the Lender's status as a nonresident
alien, as such term is defined in the Code. The Borrower shall also hold the
Lender harmless and indemnify it for any stamp or other taxes with respect to
the preparation, execution, delivery, recording, performance or enforcement of
the Credit Documents (all of which shall be included within "Taxes"). If any of
the Taxes specified in this Section 4.03 are paid by the Lender, the Borrower
shall, upon demand of the Lender, promptly reimburse the Lender for such
payments, together with any interest, penalties and expenses incurred in
connection therewith. The Borrower shall deliver to the Lender certificates or
other valid vouchers for all Taxes or other charges deducted from or paid with
respect to payments made by the Borrower hereunder.
Section 4.04. Expenses; Indemnity. (a) The Borrower agrees to pay or
reimburse the Lender for all reasonable costs and expenses incurred in
connection with the enforcement or preservation of any rights under this
Agreement, any other Credit Documents, and any such other documents, including,
without limitation, the reasonable fees and disbursements of counsel to the
Lender (but excluding fees and disbursements incurred on or prior to the date
hereof in negotiating and preparing the Credit Documents); provided, however,
that in the event of any litigation between the Borrower and the Lender
initiated prior to any Event of Default specified in Section 8.01(g) or (h) and
arising out of the matters set forth in Section 4.04(b)(i), the fees and
disbursements of counsel to the Lender shall be borne by the Borrower if and
only if the Lender is the prevailing party. The Borrower also agrees to
indemnify the Lender against any transfer taxes, documentary taxes, assessments
or charges made by
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any Governmental Authority by reason of the execution and delivery of any Credit
Document.
(b) The Borrower agrees to indemnify the Lender and its directors,
officers, employees, agents and Affiliates (for purposes of this paragraph,
each, an "Indemnitee") against, and to hold each Indemnitee harmless from, any
and all claims, liabilities, damages, losses, costs, charges and expenses
(including fees and expenses of counsel) incurred by or asserted against any
Indemnitee arising out of, in any way connected with, or as a result of (i) the
execution or delivery of any Credit Document or any agreement or instrument
contemplated by any Credit Document, the performance by the parties thereto of
their respective obligations under any Credit Document, the enforcement or
preservation by the parties thereto of their respective rights under any Credit
Document or the consummation of the transactions contemplated by any Credit
Document, (ii) the use of the proceeds of the Loans or (iii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto. The provisions of this Section
4.04(b) shall not operate or be construed to indemnify the Lender against, or
hold it harmless from, any claims, liabilities, damages, losses, costs, charges
and expenses (including fees and expenses of counsel) incurred by or asserted
against the Lender arising out of or connected with any litigation initiated
prior to any Event of Default specified in Section 8.01(g) or (h) solely between
the Borrower and the Lender in which the Lender is not the prevailing party.
(c) All amounts due under this Section 4.04 shall be payable in
immediately available funds upon written demand therefor.
Section 4.05. Survival. The provisions of Sections 4.02, 4.03, 4.04 and
this Section 4.05 shall remain operative and in full force and effect regardless
of the expiration of the term of this Agreement, the consummation of the
transactions contemplated hereby, the repayment of any of the Loans, the
invalidity or unenforceability of any term or provision of any Credit Document,
or any investigation made by or on behalf of the Lender.
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ARTICLE V
Representations and Warranties
Section 5.01. Representations and Warranties. The Borrower represents
and warrants to the Lender as follows:
(a) Subsidiaries. At the date hereof, the Borrower has no Subsidiaries
other than those Persons listed on Schedule 5.01(a).
(b) Good Standing and Power. The Borrower and each of its Subsidiaries
is a corporation, duly incorporated and validly existing in good standing under
the laws of the jurisdiction of its incorporation; each has the corporate power
to own its property and to carry on its business as now being conducted; and
each is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the properties owned or leased by it
therein or in which the transaction of its business makes such qualification
necessary, except where the failure to be so qualified, or to be in good
standing, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
(c) Corporate Authority. The Borrower has full corporate power and
authority to execute and deliver, and to incur and perform its obligations
under, each of the Credit Documents, all of which have been duly authorized by
all proper and necessary corporate action. No consent or approval of
stockholders is required as a condition to the validity or performance of, or
the exercise by the Lender of any of its rights or remedies under, any Credit
Document.
(d) Authorizations. All authorizations, consents, approvals,
registrations, notices, exemptions and licenses with or from any Governmental
Authority or other Person necessary for the execution, delivery and performance
by the Borrower of, and the incurrence and performance of each of its
obligations under, each of the Credit Documents, and the exercise by the Lender
of its remedies under each of the Credit Documents have been effected or
obtained and are in full force and effect.
(e) Binding Obligation. This Agreement constitutes and, when issued in
accordance with the terms hereof, each Note will constitute the valid and
legally binding obligation of the Borrower enforceable in accordance with its
terms, subject as to enforcement to bankruptcy, insolvency, reorganization,
moratorium
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and similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
(f) Litigation. There are no proceedings or investigations now pending
or, to the knowledge of the Borrower, threatened before any court or arbitrator
or before or by any Governmental Authority which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
(g) No Conflicts. There is no statute, regulation, rule, order or
judgment, and no provision of any agreement or instrument binding upon the
Borrower or any of its Subsidiaries, or affecting their properties, and no
provision of the certificate of incorporation or bylaws (or similar constitutive
instruments) of the Borrower or any of its Subsidiaries, that would prohibit,
conflict with or in any way impair the execution or delivery of, or the
incurrence or performance of any obligations of the Borrower under, any Credit
Document, or result in or require the creation or imposition of any Lien on
property of the Borrower or any of its Subsidiaries as a consequence of the
execution, delivery and performance of any Credit Document.
(h) Financial Condition. Except as disclosed in filings made by the
Borrower with the SEC prior to the date hereof or in the press releases issued
by the Company since September 30, 1998 and prior to the date hereof and
attached to that certain letter, dated the date hereof, from an officer of the
Borrower to an employee of the Lender making reference to this Section (such
filings and such press releases collectively, the "Disclosure Package"), (i) The
consolidated balance sheet of the Borrower as of December 31, 1997, together
with consolidated statements of income, shareholders' equity and cash flows for
the fiscal year then ended, reported upon by Ernst & Young LLP, and the
unaudited consolidated balance sheet of the Borrower as of September 30, 1998,
together with consolidated statements of income and cash flows for the nine
months then ended, heretofore delivered to the Lender, present fairly, in all
material respects, the Borrower's consolidated financial condition and
consolidated results of operations as of the dates and for the periods referred
to and have been prepared in accordance with GAAP consistently applied
throughout the period involved. There are no material liabilities (whether known
or unknown, direct or indirect, fixed or contingent, and of any nature
whatsoever) of the Borrower or any of its Subsidiaries as of the date of such
balance sheet that are not reflected therein or in the notes thereto.
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(ii) Except as disclosed in the Disclosure Package, there has been no
material adverse change in the business, properties, condition (financial or
otherwise) or operations, present or prospective, of the Borrower and its
Subsidiaries since the date of the balance sheet dated December 31, 1997
referred to in Section 5.01(h)(i). Except as disclosed in the Disclosure
Package, since December 31, 1997, there has not occurred or arisen any event,
condition or circumstance that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(i) Taxes. Each of the Borrower and its Subsidiaries has filed or
caused to be filed all tax returns that are required to be filed and paid all
taxes that are required to be shown to be due and payable on said returns or on
any assessment made against it or any of its property and all other taxes,
assessments, fees, liabilities, penalties or other charges imposed on it or any
of its property by any Governmental Authority, except for any taxes,
assessments, fees, liabilities, penalties or other charges which are being
contested in good faith and (unless the amount thereof is not material to the
Borrower's consolidated financial condition) for which adequate reserves have
been established in accordance with GAAP.
(j) Use of Proceeds. The proceeds of the Loans will be used by the
Borrower for general corporate purposes.
(k) Margin Regulations. The making of the Loans and the use of the
proceeds thereof as contemplated by the Credit Documents will not violate or be
inconsistent with any of the provisions of Regulation U, T or X (or any
successor regulation or regulations) of the Federal Reserve Board.
(l) Compliance with ERISA. Each member of the ERISA Group is in
compliance with the applicable provisions of ERISA and the Code with respect to
each Plan, except for any failure so to comply that, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
No member of the ERISA Group has (i) an accumulated funding deficiency under
Section 412 of the Code in respect of any Pension Plan, whether or not waived,
(ii) failed to make any contribution or payment to any Pension Plan, or made any
amendment to any Pension Plan, which has resulted or could result in the
imposition of a Lien or the posting of a bond or other security under Section
302(f) of ERISA or Section 401(a)(29) of the Code, (iii) incurred any liability
under Title IV of ERISA other than a liability to the PBGC for premiums under
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Section 4007 of ERISA, all of which have been paid or (iv) engaged in a
transaction with respect to a Plan, which (assuming the taxable period of such
transaction, within the meaning of Section 4975(f)(2) of the Code, to have
expired as of the date hereof) has resulted or could reasonably be expected to
result in such member being subject to a material tax or penalty imposed by
Section 4975 of the Code or Section 502 of ERISA.
(m) Not an Investment Company. Neither the Borrower nor any of its
Subsidiaries is (i) an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, or (ii) subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, each as amended, or any foreign,
federal, state or local statute or regulation limiting its ability to incur
indebtedness for money borrowed as contemplated hereby.
(n) Properties. Each of the Borrower and its Subsidiaries has good and
marketable title to, or valid leasehold interests in, all of its respective
properties and assets (excluding intellectual property) that are reflected on
the consolidated balance sheet of the Borrower as of September 30, 1998 referred
to in Section 5.01(h), except for such immaterial properties and assets as have
been disposed of in the ordinary course of business and except for minor defects
in title that do not interfere with the ability of the Borrower or any of its
Subsidiaries to conduct its business as now conducted. Except as set forth in
the Disclosure Package, the Borrower and its Subsidiaries own or are licensed to
use or otherwise have the right to use (or could obtain such ownership or
licences or rights on terms not materially adverse to the Borrower and its
Subsidiaries, taken as a whole) all of the intellectual property rights that are
reasonably necessary for the operation of their respective businesses. All such
assets and properties are so owned or held free and clear of all Liens, except
Permitted Encumbrances.
(o) Compliance with Laws and Charter Documents. (i) As a result of the
Borrower's performing any of its obligations under the Credit Documents, neither
the Borrower nor any of its Subsidiaries will be in violation of (a) any law,
statute, rule, regulation or order of any Governmental Authority (including
Environmental Laws) applicable to it or its properties or assets or (b) its
certificate of incorporation or bylaws.
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(ii) Neither the Borrower nor any of its Subsidiaries is in
violation of (A) any law, statute, rule, regulation or order of any Governmental
Authority (including Environmental Laws) applicable to it or its properties,
except for any violations which could not reasonably be expected, individually
or in the aggregate, to have a Material Adverse Effect, or (B) its certificate
of incorporation or bylaws.
(iii) Each of the Borrower and its Subsidiaries has all
authorizations, consents, approvals, registrations, franchises, licenses and
permits, with or from Governmental Authorities and other Persons as are
necessary for it to own its properties and conduct its business as now conducted
and the absence of which could reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
(p) Environmental Protection. To the Borrower's knowledge, based upon
reasonable investigation, all real property owned or leased by the Borrower or
any of its Subsidiaries is free of contamination from any substance that could
result in the incurrence of material liabilities, or constituent thereof,
currently identified or listed as hazardous or toxic pursuant to the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
9601, et seq., or any other Environmental Laws, or any other substance which has
in the past or could at any time in the future cause or constitute a health,
safety or environmental hazard to any person or property, including asbestos in
any building, petroleum products, PCBs, pesticides, or radioactive materials. To
the Borrower's knowledge, based upon reasonable investigation, neither the
Borrower nor any of its Subsidiaries has caused or suffered to occur any release
of any Hazardous Substance into the environment or any other conditions that,
individually or in the aggregate, could reasonably be expected to result in the
incurrence of material liabilities or any material violations of any
Environmental Laws. To the Borrower's knowledge, based upon reasonable
investigation, neither the Borrower nor any of its Subsidiaries has caused or
suffered to occur any condition on any of their property that could give rise to
the imposition of any lien under the Environmental Laws. Except as disclosed in
the Disclosure Package, to the Borrower's knowledge, based on reasonable
investigation, neither the Borrower nor any Subsidiary is engaged in any
manufacturing or any other operations, other than the use of petroleum products
for vehicles, that require the use, handling, transportation, storage or
disposal of any Hazardous Substance, where such operations require permits or
are otherwise regulated pursuant to the Environmental Laws.
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(q) Insurance. All of the properties and operations of the Borrower and
each of its Subsidiaries of a character usually insured by companies of
established reputation engaged in the same or a similar business similarly
situated are adequately insured, by financially sound and reputable insurers,
against loss or damage of the kinds and in amounts customarily insured against
by such Persons, and the Borrower and each of its Subsidiaries carry, with such
insurers in customary amounts, such other insurance as is usually carried by
companies of established reputation engaged in the same or a similar business
similarly situated.
(r) Adverse Contracts. Except as disclosed in the Disclosure Package,
neither the Borrower nor any of its Subsidiaries is a party to, nor is it or any
of its property subject to or bound by, any agreement or instrument which
restricts its ability to conduct its business, or could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.
(s) Solvency. The Borrower and each of its Subsidiaries is and, after
giving effect to Loans and the other transactions contemplated hereby, and after
payment of all estimated legal, investment banking, accounting and other fees
related thereto, the Borrower and each of its Subsidiaries will be Solvent.
Neither the Borrower nor any of its Subsidiaries is and, after giving effect to
Loans and the other transactions contemplated hereby, and after payment of all
estimated legal, investment banking, accounting and other fees related thereto,
the Borrower and each of its Subsidiaries will not be insolvent (as defined in
any of Uniform Laws Annotated, Uniform Fraudulent Transfer Act ss. 2 (West
1985); Cal. Civ. Code ss. 3439.02 (West 1997); and Del. Code Ann. tit. 6, ss.
1302 (1997)).
(t) Disclosure. All information relating to the Borrower or its
Subsidiaries delivered in writing to the Lender in connection with the
negotiation, execution and delivery of this Agreement and the other Credit
Documents, taken together with the information set forth in the Disclosure
Package, is true and complete in all material respects. There is no material
fact of which the Borrower is aware which, individually or in the aggregate,
would reasonably be expected adversely to influence the Lender's credit analysis
relating to the Borrower and its Subsidiaries which has not been disclosed to
the Disclosure Package.
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Section 5.02 Survival. All representations and warranties made by the
Borrower in this Agreement, and in the certificates or other instruments
prepared or delivered in connection with or pursuant to this Agreement, shall
(i) be considered to have been relied upon by the Lender, (ii) survive the
making of Loans regardless of any investigation made by, or on behalf of, the
Lender, and (iii) continue in full force and effect so long as any Loan, or
other amount payable under any Credit Document remains unpaid.
ARTICLE VI
Conditions Precedent
Section 6.01. Conditions to the Availability of the Commitment. The
obligations of the Lender hereunder are subject to, and no Quarterly Loans shall
be made until the earliest time (the "Effective Time") (which shall be no later
than the close of business in The City of New York on the fifth Business Day
following the Closing contemplated by that certain Equity Investment Agreement,
dated as of January 15, 1999, among the Borrower and certain Affiliates of the
Lender) on which each of the following conditions precedent shall have been
either satisfied or waived in writing by the Lender:
(a) This Agreement. The Agreement shall have been duly executed and
delivered by each of the Lender and the Borrower and each of the other Credit
Documents shall have been duly executed and delivered by each of the parties
thereto.
(b) Evidence of Corporate Action. The Lender shall have received the
following:
(i) a copy of the Certificate of Incorporation, of the
Borrower, as in effect on the Effective Date, certified by the
Secretary of State of the State of Delaware, and a certificate from
such Secretary of State as to the good standing of the Borrower, in
each case as of a date reasonably close to the Effective Date; and
(ii) a certificate of the Secretary or an Assistant Secretary
of the Borrower, dated the Effective Date, and stating (A) that
attached thereto is a true and complete copy of the bylaws of the
Borrower as in effect on such date and at all times since the date of
the resolutions described in clause (B) below, (B) that attached
thereto is a true and
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complete copy of resolutions duly adopted by the Board of Directors of
the Borrower authorizing the execution, delivery and performance of
this Agreement, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C) that the
certificate of incorporation of the Borrower has not been amended since
the date of the last amendment thereto shown on the certificate of good
standing furnished pursuant to clause (i) above, and (D) as to the
incumbency and signature of each officer executing this Agreement or
any document delivered in connection herewith on behalf of the
Borrower.
(c) Opinions of Counsel. The Lender shall have received a favorable
written opinion, dated the Effective Date, of Nida & Maloney PC, counsel for the
Borrower, in substantially the form of Exhibit D.
(d) Representations and Warranties. The representations and warranties
contained in Section 5.01 shall be true and correct on the Effective Date, and
the Lender shall have received a certificate, signed by a Responsible Officer of
the Borrower, to that effect.
(e) Other Documents. The Lender shall have received such other
certificates, opinions and other documents as the Lender reasonably may require.
Section 6.02. Conditions to All Quarterly Loans. The obligations of
each Lender to make each Quarterly Loan are subject to the conditions precedent
that, on the date of each Quarterly Loan and after giving effect thereto, each
of the following conditions precedent shall have been satisfied, or waived in
writing by the Lender:
(a) Borrowing Request. The Lender shall have received a Borrowing
Request in accordance with the terms of this Agreement.
(b) Note. The Lender shall have received a duly executed Note in the
form of Exhibit B, dated as of the Borrowing Date and evidencing a Quarterly
Loan in an aggregate principal equal to the Borrowing Amount.
(c) Warrant Certificate. The Borrower shall have duly issued to the
Lender a number of Warrants equal to the Warrant Number in connection with such
Quarterly Loan and shall have duly
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executed and delivered to the Lender a Warrant Certificate evidencing such
Warrants.
(d) No Default. No Default or Event of Default shall have occurred and
be continuing, nor shall any Default or Event of Default occur as a result of
the making of such Quarterly Loan.
(e) Representations and Warranties; Covenants. The representations and
warranties contained in Section 5.01 shall have been true and correct when made
and (except to the extent that any representation or warranty speaks as of a
date certain) shall be true and correct on the Borrowing Date with the same
effect as though such representations and warranties were made on such Borrowing
Date; and the Borrower shall have complied with all of its covenants and
agreements under the Credit Documents.
Section 6.03. Satisfaction of Conditions Precedent. Each of (i) the
delivery by the Borrower of a Borrowing Request (unless the Borrower notifies
the Lender in writing to the contrary prior to the Borrowing Date) and (ii) the
acceptance of the proceeds of a Quarterly Loan shall be deemed to constitute a
certification by the Borrower that, as of the Borrowing Date, each of the
conditions precedent contained in Sections 6.02(d) and (e) has been satisfied
with respect to any Loans then being made.
ARTICLE VII
Covenants
Section 7.01. Affirmative Covenants. Until satisfaction in full of all
the obligations of the Borrower under the Credit Documents, the Borrower will:
(a) Financial Statements; Compliance Certificates. Furnish to the
Lender:
(i) as soon as available, but in no event more than 60 days
following the end of each of the first three quarters of each fiscal
year, copies of the Borrower's Quarterly Report on Form 10-Q being
filed with the SEC, which shall include a consolidated balance sheet
and consolidated income statement of the Borrower and its Subsidiaries
for such quarter;
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(ii) as soon as available, but in no event more than 100 days
following the end of each fiscal year, a copy of the Borrower's Annual
Report on Form 10-K being filed with the SEC, which shall include the
consolidated financial statements of the Borrower and its Subsidiaries,
together with a report thereon by Ernst & Young LLP (or another firm of
independent certified public accountants reasonably satisfactory to the
Lender), for such year;
(iii) together with each report delivered pursuant to Sections
7.01(a)(i) and (ii), a certificate of the Borrower, signed by a
Responsible Officer, in substantially the form of Exhibit E, stating
whether, as of the last date of the financial statements included in
such report, any event has occurred or circumstance existed which,
individually or in the aggregate, constituted a Default or Event of
Default (and, if so, detailing the facts with respect thereto) and
whether the Borrower was in compliance with the covenants set forth in
this Article VII, together with calculations to establish the
Borrower's compliance with the covenants contained in Section 7.03;
(iv) promptly upon the filing by the Borrower with the SEC or
any national securities exchange or national quotation system of any
registration statement (other than a registration statement on Form S-8
or an equivalent form) or regular periodic report (other than the
reports referred to in Sections 7.01(a)(i) and (ii)), notification of
such filing; and, at the request of any Lender, the Borrower shall
deliver to such Lender a copy of such filing (excluding exhibits);
(v) promptly upon the mailing thereof to the shareholders of
the Borrower generally copies of all financial statements, reports and
proxy statements so mailed;
(vi) within five Business Days of any Responsible Officer of
the Borrower obtaining knowledge of any Default or Event of Default of
any type specified in Section 8.01(a), (b), (d), (f), (g), (h) or (l),
if such Default or Event of Default is then continuing, a certificate
of a Responsible Officer of the Borrower stating that such certificate
is a "Notice of Default" and setting forth the details thereof and the
action which the Borrower is taking or proposes to take with respect
thereto;
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(vii) within ten Business Days of any Responsible Officer of
the Borrower obtaining knowledge of any Default or Event of Default of
any type specified in Section 8.01(c),(e), (i), (j) or (k), if such
Default or Event of Default is then continuing, a certificate of a
Responsible Officer of the Borrower stating that such certificate is a
"Notice of Default" and setting forth the details thereof and the
action which the Borrower is taking or proposes to take with respect
thereto; and
(viii) such additional information, reports or statements,
regarding the business, financial condition or results of operations of
the Borrower and its Subsidiaries, as the Lender from time to time may
reasonably request.
(b) Corporate Existence. Except as permitted by Section 7.02(a),
maintain, and cause each Subsidiary to maintain, its corporate existence in good
standing and qualify and remain qualified to do business in each jurisdiction in
which the character of the properties owned or leased by it therein or in which
the transaction of its business is such that the failure to qualify,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(c) Conduct of Business. Engage in as its principal business the
development of photoselective drugs and light producing and light delivery
medical devices and related or ancillary businesses, including but not limited
to the businesses of the Borrower described in the Disclosure Package; preserve,
renew and keep in full force and effect, and cause each of its Subsidiaries to
preserve, renew and keep in full force and effect, all franchises and licenses
necessary or desirable in the normal conduct of its and its Subsidiaries'
business and the loss of which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect; and comply, and cause
each of its Subsidiaries to comply, with all applicable laws, orders, rules and
regulations of all Governmental Authorities the failure with which so to comply,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(d) Authorizations. Obtain, make and keep in full force and effect all
authorizations from and registrations with Governmental Authorities required for
the validity or enforceability of the Credit Documents.
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(e) Taxes. Pay and discharge, and cause each of its Subsidiaries to pay
and discharge, all taxes, assessments and governmental charges upon it, its
income and its properties prior to the date on which penalties are attached
thereto, except to the extent that (i) such taxes, assessments and governmental
charges shall be contested in good faith and by appropriate proceedings by the
Borrower or such Subsidiary, as the case may be, (ii) unless the amount thereof
is not material to the Borrower's consolidated financial condition, adequate
reserves are maintained (in accordance with GAAP) by the Borrower or such
Subsidiary, as the case may be, with respect thereto, and (iii) any failure to
pay and discharge such taxes, assessments and governmental charges could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.
(f) Insurance. Maintain, and cause each of its Subsidiaries to
maintain, insurance with reputable insurance companies against such risks, of
such types (including general liability), on such properties and in such amounts
as is customarily maintained by similar businesses similarly situated, and
provide to the Lender a certificate or certificates of insurance showing that
the Lender has been named as loss payee by endorsement to the policies for such
insurance.
(g) Inspection. Permit, and cause each of its Subsidiaries to permit,
upon no fewer than five Business Days' notice, the Lender to have one or more of
their officers and employees, or any other Person designated by the Lender, to
visit and inspect any of the properties of the Borrower and such Subsidiary and
to examine the minute books, books of account and other corporate and financial
records of the Borrower and such Subsidiary, and discuss its affairs, finances
and accounts with its officers and with the Borrower's independent accountants,
during normal business hours and at such other reasonable times, for the purpose
of monitoring the Borrower's compliance with its obligations under agreements to
which the Lender is a party and for no other purpose.
(h) Maintenance of Records. For the Borrower and each of its
Subsidiaries (i) keep proper books of record and account in which entries
sufficient to provide financial statements in accordance with GAAP will be made
of all dealings or transactions of or in relation to its business and affairs;
(ii) set up on its books reserves with respect to all taxes, assessments,
charges, reviews and claims; and (iii) on a current basis, set up on its books,
from its earnings, appropriate reserves against doubtful
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accounts receivable, advances and investments and all other proper reserves
(including by reason of enumeration, reserves for premiums, if any, due on
required prepayments and reserves for depreciation, obsolescence, or
amortization of properties), which should be set aside from such earnings in
connection with its business. (All determinations pursuant to this Section
7.01(h) shall be made in accordance with, or as required by, GAAP.)
(i) Maintenance of Property. Maintain, keep and preserve and cause each
of its Subsidiaries to maintain, keep and preserve all of its properties in good
repair, working order and condition and from time to time make all necessary and
proper repairs, renewals, replacements, and improvements thereto, except to the
extent that any failure so to maintain, keep and preserve such properties,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
(j) ERISA. Furnish to the Lender:
(i) within ten days after a Responsible Officer learns that
any "reportable event" (as defined in Section 4043(c) of ERISA), other
than a reportable event for which the 30-day notice requirement has
been waived by the PBGC, has occurred with respect to a Pension Plan, a
statement setting forth details as to such reportable event and the
action proposed to be taken with respect thereto;
(ii) within ten days after receipt thereof, a copy of any
notice that any member of the ERISA Group may receive from the PBGC
relating to the intention of the PBGC to terminate any Pension Plan or
to appoint a trustee to administer any Plan;
(iii) within ten days after filing with any affected party (as
such term is defined in Section 4001 of ERISA) of a notice of intent to
terminate a Pension Plan, a copy of such notice and a statement setting
forth the details of such termination, including the amount of
liability, if any, of any member of the ERISA Group under Title IV of
ERISA;
(iv) within ten days after the adoption of a material
amendment to a Pension Plan if, after giving effect to such amendment,
the Pension Plan is a plan described in Section 4021(b) of ERISA, a
statement setting forth the details thereof;
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(v) within 30 days after withdrawal from a Pension Plan during
a plan year for which any member of the ERISA Group could be subject to
liability under Section 4063 or 4064 of ERISA, a statement setting
forth the details thereof, including the amount of such liability;
(vi) within 30 days after cessation of operations by any
member of the ERISA Group at a facility under the circumstances
described in Section 4062(e) of ERISA, a statement setting forth the
details thereof, including the amount of liability of the Borrower or a
member of the ERISA Group under Title IV of ERISA;
(vii) within ten days after adoption of an amendment to a
Pension Plan which would require security to be given to the Pension
Plan pursuant to Section 401(a)(29) of the Code or Section 307 of
ERISA, a statement setting forth the details thereof, including the
amount of such security;
(viii) within ten days after failure by any member of the
ERISA Group to make payment to a Pension Plan which would give rise to
a lien in favor of the Plan under Section 302(f) of ERISA, a statement
setting forth the details thereof, including the amount of such lien;
(ix) within ten days after the due date for filing with the
PBGC, pursuant to Section 412(n) of the Code, of a notice of failure to
make a required installment or other payment with respect to a Pension
Plan, a statement setting forth details as to such failure and the
action proposed to be taken with respect thereto; and
(x) within 30 days after receipt thereof by any member of the
ERISA Group from the sponsor of a Multiemployer Plan, a copy of each
notice concerning the imposition of withdrawal liability or the
termination or reorganization of a Multiemployer Plan.
(k) Notice of Defaults and Adverse Developments. Promptly notify the
Lender upon the discovery by any Responsible Officer of the occurrence of (i)
any Default or Event of Default; (ii) any event, development or circumstance
whereby the financial statements most recently furnished to the Lender fail to
present fairly, in all material respects, and in accordance with GAAP, the
financial condition and operating results of the Borrower and its Subsidiaries
as of the date of such financial statements; (iii) any material litigation or
proceedings that are instituted
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or threatened (to the knowledge of the Borrower) against the Borrower or any of
its Subsidiaries or any of their respective assets; (iv) any event, development
or circumstance which, individually or in the aggregate, could reasonably be
expected to result in an event or default (or, with the giving of notice or
lapse of time or both, an event of default) under any Indebtedness and the
amount hereof; and (v) any other development in the business or affairs of the
Borrower or any of its Subsidiaries if the effect thereof would reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect;
in each case describing the nature thereof and the action the Borrower proposes
to take with respect thereto.
(l) Environmental Matters. (i) Comply, and cause each of its
Subsidiaries to comply, in all material respects with all applicable
Environmental Laws, (ii) notify the Lender promptly after becoming aware of any
Environmental Claim, or any fact or circumstance that is reasonably likely to
result in an Environmental Claim or a material violation of any Environmental
Law, with respect to the Borrower's or any of its Subsidiaries' properties or
facilities, and (iii) promptly forward to the Lender a copy of any material
order, notice, permit, application, or any other communication or report
received in connection with any such matters as they may affect such premises.
Section 7.02. Negative Covenants. Until satisfaction in full of all the
obligations of the Borrower under the Credit Documents, the Borrower will not:
(a) Mergers, Consolidations and Sales of Assets. Enter into any merger,
consolidation or share exchange, or acquire assets of any Person, or sell, lease
or otherwise dispose of any of its assets, or permit any of its Subsidiaries so
to do, except that (i) any such Subsidiary may merge or consolidate (A) with or
into the Borrower, if the Borrower shall be the continuing or surviving
corporation, or (B) with or into any one or more Wholly Owned Subsidiary of the
Borrower,(ii) the Borrower or any Subsidiary of the Borrower may make any Asset
Disposition to the extent permitted by Section 7.02(n) and (iii) the Borrower or
any Subsidiary of the Borrower may acquire assets for cash consideration which,
together with all other cash consideration paid by the Borrower or any
Subsidiary for assets on or following the date of this Agreement, does not
exceed $[Confidential treatment requested], and may acquire assets in exchange
for shares of Common Stock having a market value at the time of issuance which,
together with the market value at time of issuance of all other shares of Common
Stock issued by the Borrower in consideration for or in
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connection with the acquisition of assets on or following the date of this
Agreement, does not exceed $[Confidential treatment requested]; provided that
the amount of Indebtedness assumed or incurred by the Borrower or any
Subsidiary of the Borrower in connection with the acquisition of assets on or
following the date of this Agreement pursuant to this Section 7.02(a)(iii) may
not exceed [Confidential treatment requested]% of the sum of the cash
consideration paid, and the market value at time of issuance of Common Stock
issued, in consideration therefor or in connection therewith.
(b) Liens. Create, incur, assume or suffer to exist any Lien, other
than Permitted Liens, upon or in any of its or any of its Subsidiaries' property
or assets, whether now owned or hereafter acquired.
(c) Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, or permit any of its Subsidiaries so to do, except:
(i) Indebtedness to the Lender under the Credit
Documents,
(ii) Indebtedness of the Borrower or any of its
Subsidiaries secured by Liens specifically permitted by
Section 7.02(b),
(iii) Guaranties to the extent permitted by
Section 7.02(d),
(iv) Indebtedness existing on the date hereof,
(v) Indebtedness of Borrower to any Subsidiary, and
Indebtedness of any Subsidiary to Borrower or any other
Subsidiary, and
(vi) Extension, refinancings, modifications, amendments and
restatements of any of items of Permitted Indebtedness (i) through (v)
above, provided that the principal amount thereof is not increased.
(d) Contingent Liabilities. Assume, Guaranty, endorse, contingently
agree to purchase or otherwise become liable upon the obligation of any other
Person, or permit any of its Subsidiaries to do so, except:
(i) in connection with a merger or consolidation
permitted by Section 7.02(a),
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<PAGE>
(ii) by the endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of
business,
(iii) Guaranties by the Borrower of contractual obligations
(other than for the payment of Indebtedness) of any of its Wholly Owned
Subsidiaries, and
(iv) Guaranties existing on the date hereof, but not
extensions thereof.
(e) Loans and Investments. Make any Investment or permit any of its
Subsidiaries to do so, except:
(i) Investments existing on the date hereof,
(ii) Investments consisting of the endorsement of negotiable
instrument for deposit or collection or similar transaction in the
ordinary course of business,
(iii) Investments accepted in connection with asset
dispositions permitted by Section 7.02(n),
(iv) Investments of the Borrower in or to Subsidiaries of the
Borrower or of Subsidiaries of the Borrower in or to other Subsidiaries
of the Borrower or in or to the Borrower,
(v) Investments consisting of travel advances, employee
relocation loans and other employee loans and advances in the ordinary
course of business,
(vi) Investments consisting of loans to employees, officers
or directors of the Borrower or its Subsidiaries outstanding on the
date of this Agreement and not exceeding an aggregate principal balance
of $[Confidential treatment requested], relating to the purchase or
equity securities of the Borrower or its Subsidiaries pursuant to
employee stock purchase plans approved by the Borrower's Board of
Directors,
(vii) Investments consisting of loans to employees, officers
or directors of the Borrower and its Subsidiaries made on or subsequent
to the date of this Agreement and not exceeding an aggregate principal
balance of $[Confidential treatment requested] at any time outstanding,
(viii) Investments in the form of debt securities or other
evidence of Indebtedness of Ramus Medical Technologies
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<PAGE>
acquired or received on or subsequent to the date of this Agreement
pursuant to agreements or instruments in effect on the date of this
Agreement and having an aggregate principal amount not exceeding
$[Confidential treatment requested],
(ix) [Confidential treatment requested]
(x) Investments (including debt obligations) received in
connection with the bankruptcy or reorganization of customers or
suppliers and in settlement of delinquent obligations of, and other
disputes with, customers or suppliers arising in the ordinary course of
business,
(xi) Investments pursuant to or arising under currency
agreements or interest rate agreements entered into in the ordinary
course of business,
(xii) Investments consisting of notes receivable of, or
prepaid royalties and other credit extensions, to customers and
suppliers made or received in the ordinary course of business, and
(xiii) Investments in the form of deposit accounts and
marketable securities made pursuant to the cash management policy
adopted by the Borrower's Board of Directors and furnished to the
Lender prior to the date of this Agreement.
(f) Capital Expenditures. Make any Capital Expenditures, or permit any
of its Subsidiaries to do so, exceeding $[Confidential treatment requested] in
the aggregate for the Borrower and the Subsidiaries in any one calendar year;
provided that following the earliest to occur of [Confidential treatment
requested].
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<PAGE>
(g) Redemptions, etc. Redeem, defease (including but not limited to
legal or covenant defeasance), repurchase, retire or otherwise acquire or retire
for value prior to any scheduled maturity, repayment or sinking fund payment,
Indebtedness, other than Indebtedness to the Lender under the Credit Documents,
or permit any of its Subsidiaries to do so.
(h) Dividends and Purchase of Stock. Declare any dividends (other than
dividends payable in capital stock of the Borrower) on any shares of any class
of capital stock, or purchase, acquire, redeem or retire, or apply any property
or assets to the purchase, acquisition, redemption or retirement of, or set
apart any sum for the payment of any dividends on, or for the purchase,
acquisition, redemption or retirement of, or make any other distribution by
reduction of capital or otherwise in respect of, any shares of any class of
capital stock of the Borrower or any of its Subsidiaries or any options,
warrants or rights to purchase or acquire shares of any class of capital stock
of the Borrower or any such Subsidiary, or permit any of its Subsidiaries which
is not a Wholly Owned Subsidiary to do so, except that
(i) the Borrower may purchase, redeem or otherwise acquire
shares of Common Stock pursuant to any agreement existing on the date
hereof between it, or any Subsidiary of the Borrower, and any officer,
director, employee or consultant to the Borrower or any of its
Subsidiaries, in which the Borrower is obligated or has the option to
repurchase from such officer, director, employee or consultant shares
of Common Stock upon such Person's termination of employment or the
services with the Borrower or any such Subsidiary,
(ii) the Borrower may convert, exchange or redeem any
Indebtedness outstanding on the date hereof which by its terms is
convertible or exchangeable or constitutes the right to purchase any
shares of any class of capital stock of the Borrower,
(iii) [Confidential treatment requested], and
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<PAGE>
(iv) [Confidential treatment requested].
(i) Stock of Subsidiaries. Sell, pledge or otherwise dispose of any
shares of capital stock of any of its Subsidiaries (except in connection with a
merger or consolidation of a Wholly Owned Subsidiary of the Borrower permitted
by Section 7.02(a) or with the dissolution of any Subsidiary of the Borrower) or
permit any of its Subsidiaries to issue any additional shares of capital stock
except pro rata to its stockholders.
(j) Distributions by Subsidiaries. Suffer to exist, or permit any of
its Subsidiaries to suffer to exist, any consensual encumbrance or restriction
on the ability of any such Subsidiary (i) to pay, directly or indirectly,
dividends or make any other distributions in respect of its capital stock or pay
any Indebtedness or other obligation owed to the Borrower or any other
Subsidiary of the Borrower; (ii) to make loans or advances to the Borrower or
any Subsidiary of the Borrower; or (iii) to transfer any of its property or
assets to the Borrower.
(k) Related Agreements. Amend, modify or waive, or permit to be
amended, modified or waived, any provision of the Key Agreements unless, within
not less than 30 days prior to such amendment, modification or waiver, the
Borrower shall have given the Lender notice thereof, including all relevant
terms and conditions thereof, and the Lender shall have consented in writing
thereto.
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<PAGE>
(l) Sale and Leaseback Transactions. Enter into, or permit any of its
Subsidiaries to enter into, any Sale and Leaseback Transaction.
(m) Transactions with Affiliates and Related Persons. Directly or
indirectly enter into, or permit any of its Subsidiaries to directly or
indirectly enter into, on or following the date hereof, any transaction
(including, without limitation, the purchase, sale, lease or exchange of
property, the rendering of any service or the making of any loan or advance, but
excluding transactions between the Borrower and Wholly Owned Subsidiaries of the
Borrower) with any Affiliate or Related Person of the Borrower or any of its
Subsidiaries.
(n) Asset Dispositions. Make any Asset Disposition, or permit any of
its Subsidiaries to make any Asset Disposition, in one or more related
transactions, unless
(i) the Borrower (or such Subsidiary, as the case may be)
receives consideration at the time of such disposition at least equal
to the fair market value of the shares or assets disposed of (which
shall be as determined in good faith by the Board of Directors and
evidenced by a resolution adopted thereby),
(ii) the consideration for such disposition consists of cash
or readily marketable cash equivalents or the assumption of
Indebtedness of the Borrower or other obligations relating to such
assets and release from all liability on the Indebtedness or other
obligations assumed, and
(iii) [Confidential treatment requested]% of the Net
Available Asset Disposition Proceeds from such disposition (including
from the sale of any marketable cash equivalents received therein) are
applied by the Borrower (or such Subsidiary, as the case may be),
within 48 hours of the receipt thereof, to prepayment of Loans pursuant
to Section 2.04.
(o) Securities Offerings. Sell or offer to sell any securities, or
permit any of its Subsidiaries to offer or sell any securities, in one or more
related transactions, unless
(i) the consideration for such disposition consists of cash,
and
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<PAGE>
(ii) [Confidential treatment requested]% of the Net Available
Securities Offering Proceeds from such offering or sale are applied by
the Borrower (or such Subsidiary, as the case may be), within 48 hours
of the receipt thereof, to prepayment of Loans pursuant to Section
2.04.
(p) Surplus Cashflows. Fail to apply to the prepayment of Loans
pursuant to Section 2.04 at least [Confidential treatment requested]% of the
amount (the "Surplus") by which EBITDA in any calendar quarter exceeds
$[Confidential treatment requested].
Section 7.03 Financial Covenants. Until satisfaction in full of all the
obligations of the Borrower under the Credit Documents, the Borrower will not:
(a) Shareholders' Equity. Permit Shareholders' Equity as of the last
day of any calendar quarter designated below to be less than the amount set
forth opposite such quarter below.
Calendar quarter ending Shareholders' Equity
----------------------- --------------------
March 31, 1999 [Confidential Treatment requested]
June 30, 1999 [Confidential Treatment requested]
September 30, 1999 [Confidential Treatment requested]
December 31, 1999 [Confidential Treatment requested]
March 31, 2000 [Confidential Treatment requested]
June 30, 2000 [Confidential Treatment requested]
Each calendar quarter
ending after June 30,
2000 [Confidential Treatment requested]
(b) Current Ratio. Permit the ratio of Current Assets to Current
Liabilities to be less that [Confidential treatment requested] at any time.
(c) Minimum Operating Income. [Confidential Treatment requested]
(d) Ophthalmology Expense. [Confidential Treatment requested]
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<PAGE>
ARTICLE VIII
Events of Default
Section 8.01. Events of Default. If one or more of the following events
(each, an "Event of Default") shall occur:
(a) the Borrower shall fail duly to pay any principal of any Loan when
due, whether at maturity, by notice of intention to prepay or otherwise; or
(b) the Borrower shall fail duly to pay any interest, fee or any other
amount payable under the Credit Documents within five Business Days after the
same shall be due, in the manner set forth in this Agreement; or
(c) the Borrower shall fail duly to observe or perform any term,
covenant, or agreement contained in Section 7.02 or 7.03; or
(d) the Borrower shall fail duly to observe or perform any other term,
covenant or agreement contained in this Agreement, and such failure shall have
continued unremedied for a period of 30 days following written notice to the
Borrower thereof; or
(e) any representation or warranty made or deemed made by the Borrower
in a Credit Document, or any statement or representation made in any
certificate, report or opinion delivered by or on behalf of the Borrower in
connection with a Credit Document, shall prove to have been false or misleading
in any material respect when so made or deemed made; or
(f) the Borrower or any of its Subsidiary shall fail to pay any
Indebtedness (other than obligations hereunder) in an amount of $[Confidential
treatment requested] or more when due; or any such Indebtedness having an
aggregate principal amount outstanding of $[Confidential treatment requested] or
more shall become or be declared to be due prior to the expressed maturity
thereof; or
(g) an involuntary case or other proceeding shall be commenced against
the Borrower or any of its Subsidiaries seeking liquidation, reorganization or
other relief with respect
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<PAGE>
to it or its debts under any applicable bankruptcy, insolvency, reorganization
or similar law or seeking the appointment of a custodian, receiver, liquidator,
assignee, trustee, sequestrator or similar official of it or any substantial
part of its property, and such involuntary case or other proceeding shall remain
undismissed and unstayed for a period of more than 60 days; or an order or
decree approving or ordering any of the foregoing shall be entered and continued
unstayed and in effect; or
(h) the Borrower or any of its Subsidiaries shall commence a voluntary
case or proceeding under any applicable bankruptcy, insolvency, reorganization
or similar law or any other case or proceeding to be adjudicated a bankrupt or
insolvent, or any of them shall consent to the entry of a decree or order for
relief in respect of the Borrower or any such Subsidiary in an involuntary case
or proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against any of them, or any of them shall file a petition or answer
or consent seeking reorganization or relief under any applicable law, or any of
them shall consent to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or similar official of the Borrower or any such Subsidiary or any
substantial part of their respective property, or any of them shall make an
assignment for the benefit of creditors, or any of them shall admit in writing
its inability to pay its debts generally as they become due, or the Borrower or
any Subsidiary shall take corporate action in furtherance of any such action; or
(i) one or more judgments against the Borrower or any of its
Subsidiaries or attachments against its property, which in the aggregate exceed
$[Confidential treatment requested], or the operation or result of which could
be to interfere materially and adversely with the conduct of the business of the
Borrower or any such Subsidiary remain unpaid, unstayed on appeal, undischarged,
unbonded, or undismissed for a period of more than 30 days; or
(j) notice of intent to terminate a Pension Plan shall have been filed
with any affected party (as defined in Section 4001 of ERISA), or notice of an
application by the PBGC to institute proceedings to terminate a Pension Plan
pursuant to Section 4042 of ERISA shall have been received by any member of the
ERISA Group, in each case only if the amount of unfunded benefit liabilities (as
defined in Section 4001(a)(18) of ERISA)
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<PAGE>
as of the date such notice is filed or received exceeds $500,000; any member of
the ERISA Group incurs liability under Sections 4062(e), 4063 or 4064 of ERISA
in respect of a Pension Plan in an amount in excess of $1,000,000; an amendment
is adopted to a Pension Plan which would require security to be given to such
Pension Plan pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA
in an amount in excess of $1,000,000; any member of the ERISA Group fails to
make a payment to a Pension Plan which would give rise to a Lien in favor of
such Plan under Section 302(f) of ERISA in an amount in excess of $500,000; or
(k) any court or governmental or regulatory authority shall have
enacted, issued, promulgated, enforced or entered any statute, rule, regulation,
judgment, decree, injunction or other order (whether temporary, preliminary or
permanent) which is in effect and which prohibits, enjoins or otherwise
restricts, in a manner that, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect, any of the transactions
contemplated under the Credit Documents; or
(l) any person or group of persons (within the meaning of Section 13 or
14 of the Securities Exchange Act of 1934, as amended), other than the Lender
and its Affiliates and other than any person or group of persons which has
beneficial ownership of 5% or more of the outstanding shares of Common Stock as
of the date of this Agreement, shall have acquired beneficial ownership (within
the meaning of Rule 13d-3 promulgated by the Securities and Exchange Commission
under said Act) of 19.9% or more of the outstanding shares of Common Stock; or,
during any period of 24 consecutive calendar months, individuals who were
directors of the Borrower on the first day of such period shall cease to
constitute a majority of the board of directors of the Borrower;
then, and at any time during the continuance of such Event of Default, the
Lender may, by written notice to the Borrower declare any Loans then outstanding
to be due, whereupon the principal of the Loans so declared to be due, together
with accrued interest thereon and any unpaid amounts accrued under the Credit
Documents, shall become forthwith due, without presentment, demand, protest or
any other notice of any kind (all of which are hereby expressly waived by the
Borrower).
Section 8.02. Assignments. (a) Upon reasonable prior notice having been
given to the Borrower, the Lender may at any time assign to one or more of The
Pharmacia & Upjohn
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Company, Pharmacia & Upjohn B.V., Pharmacia & Upjohn AB or Pharmacia & Upjohn
S.p.A. (any such entity, an "Approved Subsidiary") all, or a proportionate part
of all, of its rights and obligations under this Agreement, and such Approved
Subsidiary shall assume such rights and obligations, pursuant to a written
instrument executed by such Approved Subsidiary and the Lender. If there shall
have occurred an Event of Default that is continuing, the Lender may assign to
any Person, other than a Person which engages in, as its principal business or
one of its principal businesses, the development of photoselective drugs or
light producing and light delivery medical devices (any such assignee, or any
Approved Subsidiary referred to in the previous sentence being referred to as an
"Assignee"), all, or a proportionate part of all, of its rights and obligations
under this Agreement, and such Assignee shall assume such rights and
obligations, pursuant to a written instrument executed by such Assignee and the
Lender. Any such Assignee shall have all the rights and obligations of the
Lender, and the Lender shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required.
(b) No Assignee of the Lender's rights shall be entitled to receive any
greater payment under Section 4.03 or 4.04 than the Lender would have been
entitled to receive with respect to the rights transferred, and amounts payable
under this Agreement shall not be increased in respect of any Taxes required to
be withheld or deducted solely as a consequence of the Lender's status as a
nonresident alien, as such term is defined in the Code.
Section 8.03. Certain Pledges. Notwithstanding any other provision in
this Agreement, any Lender may at any time create a security interest in, or
pledge, all or any portion of its rights under this Agreement and any Note held
by it in favor of any Person.
ARTICLE IX
Miscellaneous
SECTION 9.01. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE.
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<PAGE>
SECTION 9.02. WAIVER OF JURY. THE BORROWER AND THE LENDER EACH HEREBY
WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, THE NOTES OR
THE RELATIONSHIPS ESTABLISHED HEREUNDER.
Section 9.03. Jurisdiction and Venue; Service of Process. (a) The
Borrower and the Lender each hereby irrevocably submits to the non-exclusive
jurisdiction of any state or federal court in the Borough of Manhattan, The City
of New York for the purpose of any suit, action, proceeding or judgment relating
to or arising out of any Credit Document and to the laying of venue in the
Borough of Manhattan, The City of New York. The Borrower and the Lender each
hereby irrevocably waives, to the fullest extent permitted by applicable law,
any objection to the laying of the venue of any such suit, action or proceeding
brought in the aforesaid courts and hereby irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an
inconvenient forum.
(b) The Borrower agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
Borrower at its address set forth in Section 9.07 or at such other address of
which the Lender shall have been notified pursuant thereto. The Borrower further
agrees that nothing herein shall affect the right to effect service of process
in any other manner permitted by law or shall limit the right to sue any other
jurisdiction.
(c) Each of the Borrower and the Lender waives, to the maximum extent
not prohibited by law, any right it may have to claim or recover in any legal
action or proceeding referred to in this Section 9.03 any special, exemplary,
punitive or consequential damages. The waiver set forth in this Section 9.03(c)
shall terminate automatically upon the occurrence of a "Separation Event" as
defined in that certain stockholder rights protection plan of Pharmacia &
Upjohn, Inc. in effect on the date of this Agreement, as it may from time to
time be amended.
Section 9.04. Set-off. The Borrower hereby authorizes the Lender and
each of its Affiliates, upon the occurrence of an Event of Default and at any
time and from time to time during the continuance thereof, to the fullest extent
permitted by law, to set-off and apply any and all sums payable
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by such Lender or any such Affiliate to or for the credit or the account of the
Borrower or any of its Affiliates against any of the obligations of the Borrower
or any of its Affiliates, now or hereafter existing under any Credit Document,
irrespective of whether the Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of the
Lender and its Affiliates under this Section 9.04 are in addition to other
rights and remedies (including other rights of set-off) which the Lender and its
Affiliates may have.
Section 9.05. Amendments and Waivers. (a) Any provision of this
Agreement may be amended, modified, supplemented or waived, but only by a
written amendment or supplement, or written waiver, signed by the Borrower and
the Lender.
(b) Except to the extent expressly set forth therein, any waiver shall
be effective only in the specific instance and for the specific purpose for
which such waiver is given.
Section 9.06. Cumulative Rights; No Waiver. Each and every right
granted to the Lender hereunder or under any other document delivered in
connection herewith, or allowed the Lender by law or equity, shall be cumulative
and not exclusive and may be exercised from time to time. No failure on the part
of the Lender to exercise, and no delay in exercising, any right will operate as
a waiver thereof, nor will any single or partial exercise by the Lender of any
right preclude any other or future exercise thereof or the exercise of any other
right.
Section 9.07. Notices. (a) Any communication, demand or notice to be
given hereunder will be duly given when delivered in writing or by telecopy to a
party at its address as indicated below or such other address as such party may
specify in a notice to each other party hereto. A communication, demand or
notice given pursuant to this Section 9.07 shall be addressed:
If to the Borrower, to
Miravant Medical Technologies
7408 Hollister Avenue
Santa Barbara, California 93117
Telecopy: (805) 685-6038
Attention: Gary S. Kledzik
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with copies (which, in and of themselves, shall not constitute
notice) to
Nida & Maloney PC
800 Anacapa Street
Santa Barbara, California 93101
Telecopy: (805) 568-1955
Attention: Joseph E. Nida
and
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304
Telecopy: (650) 493-6811
Attention: John T. Sheridan
If to the Lender, to
Pharmacia & Upjohn Treasury Services AB
Lindhagensgatan 133
S-112 87 Stockholm, Sweden
Telecopy: +46 8 695 47 08
Attention: Associate General Counse
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 470-8047
Attention: Treasurer
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
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<PAGE>
Telecopy: (908) 306-4485
Attention: Senior Vice President of Business
Development
and
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Telecopy: (908) 306-4489
Attention: General Counsel
with a copy (which, in and of itself, shall not constitute
notice) to
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Telecopy: (212) 558-3588
Attention: Neil T. Anderson,
Matthew G. Hurd
and Martin J. Travers
This Section 9.07 shall not apply to notices referred to in Article II
of this Agreement, except to the extent set forth therein.
(b) Unless otherwise provided to the contrary herein, any notice which
is required to be given in writing pursuant to the terms of this Agreement may
be given by telecopy.
Section 9.08. Certain Acknowledgments. The Borrower hereby confirms and
acknowledges that the Lender does not have any fiduciary or similar relationship
to the Borrower and that the relationship established by the Credit Documents
between the Lender and the Borrower is solely that of creditor and debtor and
(b) that no joint venture exists between the Borrower and the Lender.
Section 9.09. Separability. In case any one or more of the provisions
contained in any Credit Document shall be invalid, illegal or unenforceable in
any respect under any law,
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the validity, legality and enforceability of the remaining provisions contained
herein or in any other Credit Document shall not in any way be
affected or impaired thereby.
Section 9.10. Parties in Interest. This Agreement shall be binding upon
and inure to the benefit of the Borrower and the Lender and their respective
successors and assigns, except that the Borrower may not assign any of its
rights hereunder without the prior written consent of the Lender, and any
purported assignment by the Borrower without such consent shall be void.
Section 9.11. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all the counterparts shall together constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
MIRAVANT MEDICAL TECHNOLOGIES
By: /S/ Gary S. Kledzik
---------------------------------
Title: Chief Executive Officer
PHARMACIA & UPJOHN TREASURY SERVICES AB
By: /S/ Mats Pettersson
---------------------------------
Title: Attorney-In-Fact
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Schedule 5.01(a)
Subsidiaries of the Borrower
Miravant Pharmaceuticals, Inc.
Miravant Cardiovascular, Inc.
Miravant Systems, Inc.
<PAGE>
Exhibit A
Form of Borrowing Request
[Date]*
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Attention: Treasurer
Borrowing Request
Ladies and Gentlemen:
reena
Reference is made to the Credit Agreement, dated as of February 18,
1999 (as amended, modified or supplemented from time to time, the "Credit
Agreement"), between Miravant Medical Technologies and Pharmacia & Upjohn
Treasury Services AB. Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in the Credit Agreement.
The Borrower hereby gives you notice, pursuant to Section 2.02(a) of
the Credit Agreement, that it requests a Quarterly Loan in a principal amount
equal to the Borrowing Amount set forth below, to be made on the Borrowing Date
set forth below.
Borrowing Date:** _________, ____
Borrowing Amount:*** $___________
- ------------
* See Section 2.02 the Credit Agreement.
** See the definition of "Borrowing Date" in Section 1.01(c) of the Credit
Agreement.
*** See Section 2.01 and the definition of "Maximum Quarterly Amount in
Section 1.01(c) of the Credit Agreement.
<PAGE>
Warrant Number:**** ___________
A duly executed Note in the form of Exhibit B to the Credit Agreement,
dated as of the Borrowing Date set forth above and evidencing a Quarterly Loan
in a principal amount equal to the Borrowing Amount set forth above, is
enclosed.
A duly executed Warrant Certificate evidencing a number of Warrants
equal to the Warrant Number is enclosed. The Exercise Price for each such
Warrant is $______, and the closing bid prices for the 10 Trading Days preceding
this bid request and a calculation of the Exercise Price are set out below. The
Exercise Price is the sum of [A] plus [B].
Trading Day Closing Bid Price
----------- -----------------
1. $
2.
3.
4.
5.
6.
7.
8.
9.
10. =================
Total _________________
divided by 10 _________________ [A]
x 0.40 _________________ [B]
[A]+[B] _________________
Very truly yours,
MIRAVANT MEDICAL TECHNOLOGIES
By:
---------------------------
Name:
Title:
- ----------
**** See the definition of "Warrant Number" in Section 1.01(c) of the
Credit Agreement.
A-2
<PAGE>
Exhibit B
Form of Note
PROMISSORY NOTE
$[Principal Amount] [Date]
MIRAVANT MEDICAL TECHNOLOGIES, a Delaware corporation (the "Borrower"),
for value received, promises to pay to the order of Pharmacia & Upjohn Treasury
Services AB (the "Lender"), on [MATURITY DATE], the principal sum of $[PRINCIPAL
AMOUNT] pursuant to and in the manner contemplated by that certain Credit
Agreement, dated as of February 18, 1999 (as amended, modified or supplemented
from time to time, the "Credit Agreement"), between the Borrower and the Lender.
The Borrower also promises to pay interest on the unpaid principal
amount hereof from time to time outstanding, from the date hereof until the date
of repayment, at the rate or rates per annum and on the date or dates determined
pursuant to the Credit Agreement.
Payments of both principal and interest are to be made in lawful money
of the United States of America in funds immediately available to the Lender at
its office or offices designated in accordance with the Credit Agreement, or, if
and only if specifically permitted by Section 2.01(b) of the Credit Agreement,
in the manner set forth in such Section 2.01(b).
All parties hereto, whether as makers, endorsers, or otherwise,
severally waive diligence, presentment, demand, protest and notice of any kind
whatsoever. The failure or forbearance by the holder to exercise any of its
rights hereunder in any particular instance shall in no event constitute a
waiver thereof.
The Credit Agreement, among other things, contains provisions for the
acceleration of the maturity hereof upon the happening of certain events and for
the amendment or waiver of certain provisions of the Credit Agreement and/or
this Note, all upon the terms and conditions therein specified. Capitalized
terms used and not otherwise defined herein have the meanings ascribed thereto
in the Credit Agreement.
B-1
<PAGE>
THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
This Note is not negotiable and may be assigned only upon the terms and
conditions specified in the Credit Agreement.
MIRAVANT MEDICAL TECHNOLOGIES
By:
--------------------------
Name:
Title:
B-2
<PAGE>
Exhibit C
Form of Opinion of Counsel for the Borrower
to be Delivered Upon Payment of Shares
[TO COME]
C-1
<PAGE>
Exhibit D
Form of Opinion of Counsel for the
Borrower to be Delivered at the Effective Time
[Effective Date]
Pharmacia & Upjohn, Inc.
95 Corporate Drive
Bridgewater, New Jersey 08807
Ladies and Gentlemen:
In connection with the execution and delivery today of the Credit
Agreement, dated as of February 18, 1999 (the "Credit Agreement"), between
Miravant Medical Technologies, Inc., a Delaware corporation (the "Borrower"),
and Pharmacia & Upjohn Treasury Services AB, a Swedish corporation (the
"Lender"), the Security Agreement, dated as of February 18, 1999 (the "Security
Agreement"), among the Borrower, as debtor, and the Lender, as Secured Party,
and [add references to other Credit Documents] (collectively with the Credit
Agreement and the Security Agreement, the "Credit Documents"), we, as counsel
for the Borrower, have examined such corporate records, certificates and other
documents, and such questions of law, as we have considered necessary or
appropriate for the purposes of this opinion. Upon the basis of such
examination, it is our opinion that:
(1) The Borrower has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware.
(2) Each of the Credit Documents has been duly authorized,
executed and delivered, and, if and when duly executed and delivered in
accordance with the terms of the Credit Agreement, any Notes will be
duly authorized, executed and delivered by the Borrower; and each of
the Credit Documents (other than any Notes) constitutes, and each Note
(if and when duly executed and delivered in accordance with the terms
of the Credit Agreement) will constitute, the valid and legally binding
obligation of the Borrower enforceable in accordance with its
respective terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
D-1
<PAGE>
(3) [OPINION ON THE WARRANTS AND EXERCISE SHARES]
(4) All regulatory consents, authorizations, approvals and
filings required to be obtained or made by the Borrower under the
Federal laws of the United States and the laws of the State of New York
for the borrowing by the Borrower from the Lender under the Credit
Agreement, the execution and delivery of each of the Credit Documents
to the Lender and the performance by the Company of its obligations
thereunder have been obtained or made; provided, however, that, insofar
as performance by the Borrower of its obligations under each of the
Credit Documents is concerned, we express no opinion as to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors'
rights or as to general equity principles.
(5) The Borrower is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940.
For purposes of this letter, terms defined in the Credit Agreement have
the meanings set forth therein.
The foregoing opinion is limited to the Federal laws of the United
States and the laws of the State of New York, and we are expressing no opinion
as to the effect of the laws of any other jurisdiction.
With your approval, we have relied as to certain matters on information
obtained from public officials, officers of the Borrower and other sources
believed by us to be responsible, and we have assumed that each of the Credit
Documents has been duly authorized, executed and delivered by the parties
thereto other than the Borrower and its Affiliates, and that the signatures on
all documents examined by us are genuine, assumptions which we have not
independently verified.
D-2
<PAGE>
This letter is delivered by us as counsel for the Borrower to you, and
is solely for your benefit.
Very truly yours,
NIDA & MALONEY PC
D-3
<PAGE>
Exhibit E
Form of Compliance Certificate
COMPLIANCE CERTIFICATE
[For the Fiscal Quarter ending ________]
[For the Fiscal Year ending ________]
Reference is made to the Credit Agreement, dated as of February 18,
1999 (as amended, modified or supplemented from time to time, the "Credit
Agreement"), between Miravant Medical Technologies (the "Borrower") and
Pharmacia & Upjohn Treasury Services AB Pursuant to Section 7.01(a)(iii) of the
Credit Agreement, the undersigned Responsible Officer of the Borrower hereby
certifies on behalf of the Borrower that:
(a) During the period of four consecutive fiscal quarters ended on
____________, __, such Responsible Officer has obtained no knowledge of any
Default or Event of Default except as follows: [Specify with particularity].
The financial statements referred to in Section 7.01(a) of the Credit
Agreement which are delivered concurrently with the delivery of this Compliance
Certificate fairly present the financial position, results of operations, cash
flows and changes in shareholders' equity of the Borrower and its Subsidiaries,
subject to normal year-end audit adjustments which are not expected to be
material in amount.*
(b) The covenant calculations set forth below are based on the
Borrower's [audited] balance sheet and statements of earnings, cash flows and
shareholders' equity for the fiscal [quarter] [year] ended ___________, ____
(the "Period-End Date").
[Insert calculations demonstrating compliance with Section 7.03
of the Credit Agreement]
- ----------
* Insert only in Compliance Certificates accompanying quarterly financial
statements delivered pursuant to Section 7.01(a) of the Credit Agreement.
<PAGE>
IN WITNESS WHEREOF, on behalf of the Borrower, the undersigned has
hereto set his or her hand.
Dated:_________, ___
MIRAVANT MEDICAL TECHNOLOGIES
By: _______________________________
A Responsible Officer
E-2
EXHIBIT I
JOINT FILING AGREEMENT
----------------------
In accordance with Rule 13d-1(k)(1) promulgated under the Securities
Exchange Act of 1934, the undersigned agree to the joint filing of a Statement
on Schedule 13D (including any and all amendments thereto) with respect to the
Common Stock, $0.01 par value, of Miravant Medical Technologies, and further
agree to the filing of this agreement as an Exhibit thereto. In addition, each
party to this Agreement expressly authorizes each other party to this Agreement
to file on its behalf any and all amendments to such Statement on Schedule 13D.
Dated: February 26, 1999
PHARMACIA & UPJOHN COMPANY
By: /s/ Don W. Schmitz
------------------------
Title: Secretary
PHARMACIA & UPJOHN S.p.A.
By: /s/ Mats Pettersson
------------------------
Title: Attorney-In-Fact
PHARMACIA & UPJOHN AB
By: /s/ Mats Pettersson
------------------------
Title: Attorney-In-Fact
PHARMACIA & UPJOHN HOLDINGS B.V.
By: /s/ Wim Kuiper
------------------------
Title: Director
<PAGE>
PHARMACIA & UPJOHN, INC.
By: /s/ Don W. Schmitz
------------------------
Title: Secretary
