UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 30,
2018
MABVAX THERAPEUTICS HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware
|
|
000-31265
|
|
93-0987903
|
(State or other jurisdiction
of incorporation)
|
|
(Commission
File Number)
|
|
(IRS Employer
Identification No.)
|
11535 Sorrento Valley Rd., Suite 400
San Diego, CA 92121
(Address of principal executive offices and zip code)
Registrant’s telephone number,
including area code:
(858) 259-9405
N/A
(Former name or former address, if changed since last
report.)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
☐
|
Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
|
☐
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|
☐
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|
☐
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
|
Indicate by check mark whether the registrant is an emerging growth
company as defined in as defined in Rule 405 of the Securities Act
of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this
chapter).
Emerging growth company [X]
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. [
]
Item 1.01
Entry into a Material Definitive Agreement.
On May
1 and May 2, 2018, MabVax Therapeutics Holdings, Inc. (the
“Company”) entered into separate purchase agreements
(the “Purchase Agreements”) with accredited investors
(the “Investors”) pursuant to which it agreed to sell
7,818.18 shares of a new
0% Series N Convertible
Preferred Stock (“Series N Preferred Stock”) with a
stated value of $110 per share (the “May 2018
Offering”). The Series N Preferred Stock is initially
convertible into approximately 781,818 shares of common stock at
$1.10 per share, subject to adjustment for stock splits, stock
dividends, recapitalizations, combinations, subdivisions or other
similar events and was purchased. Certain of the Investors also
invested in the Company’s offering in February 2018 (the
“Prior Investors”). The gross proceeds expected to be
received by the Company total approximately $860,000 before
estimated expenses of $10,000.
The offering is expected to close on or before May
7, 2018. No bank was used in connection with the May 2018
Offering.
In
connection with the May 2018 Offering, we offered incentive shares
(the “May 2018 Inducement Shares”) to the Prior
Investors pursuant to a letter agreement dated May 1, 2018 (the
“May 2018 Letter Agreement”), as an incentive for the
Prior Investors to make a minimum investment in the May 2018
Offering equal to 40% of their investment in February 2018. Such
Prior Investors shall be entitled to receive their pro rata share
of 10,988.88 shares of a new 0% Series O Convertible Preferred
Stock (the “Series O Preferred Stock”), initially
convertible into 1,098,888 shares of common stock, with a stated
value of $0.01 per share, based on each of the Prior
Investor’s portion of the $860,000 investment in the May 2018
Offering.
Pursuant
to the rules of The Nasdaq Stock Market LLC (“NASDAQ”),
we are not permitted to issue any shares of common stock upon
conversion of the Series N Preferred Stock which, when aggregated
with the shares of common stock issued in the February 2018
transaction, would cause the Company to exceed 19.99% of the number
of shares outstanding on February 2, 2018, except that such
limitation shall not apply in the event that we obtain the approval
of our stockholders as required by the applicable rules of NASDAQ
for issuances of common stock in excess of such amount. Further, we
are not permitted to issue any shares of common stock upon
conversion of the Series O Preferred Stock until we obtain the
approval of our stockholders.
The
shares of Series N Preferred Stock and Series O Preferred Stock
were offered and sold solely to “accredited investors”
in reliance on the exemption from registration afforded by Rule 506
of Regulation D and Section 4(a)(2) of the Securities Act of 1933,
as amended (the “Securities Act”). The Company entered
into separate registration rights agreements (the
“Registration Rights Agreements”) with the Investors,
and the May 2018 Letter Agreement with each of the Prior Investors,
pursuant to which the Company agreed to undertake to file a
registration statement to register the resale of the shares of
common stock underlying the Series N Preferred Stock and Series O
Preferred Stock
within 30 days of the
later to occur of (i) issuance of the May 2018 Inducement Shares
and (ii) the date the Securities and Exchange Commission agrees to
begin reviewing future filings of the Company’s registration
statements, and
to cause such registration statement to be
declared effective as set forth therein and to maintain the
effectiveness of the registration statement until all of such
shares of common stock underlying the Series N Preferred Stock and
Series O Preferred Stock have been sold or are otherwise able to be
sold pursuant to Rule 144 under the Securities Act, without any
restrictions.
The
foregoing descriptions of the Purchase Agreements, Registration
Rights Agreements and May 2018 Letter Agreement are not complete
and are qualified in their entireties by reference to the full text
of the form of Purchase Agreement, the form of Registration Rights
Agreement, and the form of May 2018 Letter Agreement, copies of
which are filed as Exhibit 10.1, Exhibit 10.2, and Exhibit 10.3,
respectively, to this Report and are incorporated by reference
herein.
Item 3.02
Unregistered Sales of Equity Securities.
Reference is made
to the disclosure set forth under Item 1.01 above, which is
incorporated by reference, in its entirety, into this Item
3.02.
Item 5.03
Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
Certificate of
Designations, Preferences and Rights of the 0% Series N Convertible
Preferred Stock –
On April 30, 2018, the
Company filed a Certificate of Designations, Preferences and Rights
of the 0% Series N Convertible Preferred Stock (the
“Certificate of Designations”) with the Secretary of
State of the State of Delaware, designating 20,000 shares of
preferred stock as Series N Preferred Stock.
The
shares of Series N Preferred Stock are convertible into shares of
common stock based on a conversion calculation equal to the stated
value of the Series N Preferred Stock, plus all accrued and unpaid
dividends, if any, on such Series N Preferred Stock, as of such
date of determination, divided by the conversion price. The stated
value of each share of Series N Preferred Stock is $110 and the
initial conversion price is $1.10 per share, each subject to
adjustment for stock splits, stock dividends, recapitalizations,
combinations, subdivisions or other similar events.
The Certificate of
Designations includes a 4.9% beneficial ownership conversion
blocker, a 19.99% blocker provision to comply with the rules of
NASDAQ until
stockholders have
approved any or all shares of common stock issuable upon conversion
of the Series N Preferred Stock, and price protection for so long
as the holder owns the Series N Preferred Stock. All shares of the
Company’s capital stock will be junior in rank to the Series
N Preferred Stock, with respect to the preferences as to dividends,
distributions and payments upon the liquidation, dissolution and
winding-up of the Company, except for the Company’s Series D
Preferred Stock, Series E Preferred Stock, Series I Preferred
Stock, Series J Preferred Stock, Series K Preferred Stock, Series L
Preferred Stock and Series M Preferred Stock.
In
the event of liquidation, the holders of Series N Preferred Stock
shall be entitled to receive in cash out of the assets of the
Company, whether from capital or from earnings available for
distribution to its shareholders (the “Liquidation
Funds”), before any amount shall be paid to the holders of
any of shares of capital stock, an amount per Series N Preferred
Share equal to the greater of (a) the par value thereof on the date
of such payment, and (b) the amount per share such holder would
receive if such holder converted such Series N Preferred Stock into
common stock immediately prior to the date of such payment;
provided, however, that, if the Liquidation Funds are insufficient
to pay the full amount due to the holders and holders of shares of
parity stock (stock ranking equal to the Series N Preferred
Shares), then each holder of Series N Preferred Stock and each
holder of parity stock shall receive a percentage of the
Liquidation Funds equal to the full amount of Liquidation Funds
payable to such Holder and such holder of parity stock as a
liquidation preference, in accordance with their respective
certificate of designation (or equivalent), as a percentage of the
full amount of Liquidation Funds payable to all holders of Series N
Preferred Stock and all holders of shares of parity stock. All the
preferential amounts to be paid to the holders of Series N
Preferred Stock shall be paid or set apart for payment before the
payment or setting apart for payment of any amount for, or the
distribution of any Liquidation Funds of the Company to the holders
of shares of junior stock in connection with a Liquidation
Event.
We
are prohibited from effecting a conversion of the Series N
Preferred Stock to the extent that, as a result of such conversion,
the holder would beneficially own more than 4.99% of the number of
shares of common stock outstanding immediately after giving effect
to the issuance of shares of common stock upon conversion of the
Series N Preferred Stock, which beneficial ownership limitation may
be increased by the holder up to, but not exceeding, 9.99%. Each
holder is entitled to vote on all matters submitted to stockholders
of the Company, and shall have the number of votes equal to the
number of shares of common stock issuable upon conversion of such
holder’s Series N Preferred Stock, but not in excess of the
beneficial ownership limitations
,
and except that the holder may not vote for approval of shares of
Common Stock issuable upon conversion of Series N Preferred Stock
at any meeting of the Company's stockholders.
The foregoing description of the Series N Preferred Stock is not
complete and is qualified in its entirety by reference to the full
text of the Form of Certificate of Designations, a copy of which is
filed as Exhibit 3.1 to this report and is incorporated by
reference herein.
Correction to Certificate
of Designations, Preferences and Rights of the 0% Series N
Convertible Preferred Stock –
On May 2, 2018,
the Company filed a
correction to the Certificate of Designations.
The inaccuracy or defect in the Certificate of
Designation was that the Certificate of Designation inadvertently
stated a specific number of shares in Section 4(f) “19.99%
Conversion Blocker.” The Certificate of Designation
was
corrected by amending and restating
Section 4(f) in its entirety to remove such
inadvertent inclusion.
The foregoing description of the Certificate of Correction is not
complete and is qualified in its entirety by reference to the full
text of the Form of Certificate of Correction, a copy of which is
filed as Exhibit 3.2 to this report and is incorporated by
reference herein.
Certificate of
Designations, Preferences and Rights of the 0% Series O Convertible
Preferred Stock –
On April 30, 2018, the
Company filed a Certificate of Designations, Preferences and Rights
of the 0% Series O Convertible Preferred Stock (the “Series O
Certificate of Designations”) with the Secretary of State of
the State of Delaware, designating 20,000 shares of preferred stock
as Series O Preferred Stock.
The
shares of Series O Preferred Stock are convertible into shares of
common stock based on a conversion calculation equal to the stated
value of the Series O Preferred Stock, plus all accrued and unpaid
dividends, if any, on such Series O Preferred Stock, as of such
date of determination, divided by the conversion price. The stated
value of each share of Series O Preferred Stock is $0.01 and the
initial conversion price is $0.0001 per share, each subject to
adjustment for stock splits, stock dividends, recapitalizations,
combinations, subdivisions or other similar events. We are not
permitted to issue any shares of common stock upon conversion of
the Series O Preferred Stock until we obtain the approval of our
stockholders.
In the event of a liquidation, dissolution or
winding up of the Company, each share of Series O Preferred Stock
will be entitled to a per share preferential payment equal to the
stated value on the date of such payment.
All shares of capital
stock will be junior in rank to Series O Preferred Stock with
respect to the preferences as to dividends, distributions and
payments upon the liquidation, dissolution and winding-up of the
Company, except for the Company’s Series D Preferred Stock,
Series E Preferred Stock, Series I Preferred Stock, Series J
Preferred Stock, Series K Preferred Stock, Series L Preferred
Stock, Series M Preferred Stock and Series N Preferred
Stock.
The holders of Series O
Preferred Stock will be entitled to receive dividends if and when
declared by our board of directors. The Series O Preferred Stock
shall participate on an “as converted” basis, with all
dividends declared on our common stock. In addition, if
we grant, issue or sell any rights to purchase our securities pro
rata to all our record holders of our common stock, each holder
will be entitled to acquire such securities applicable to the
granted purchase rights as if the holder had held the number of
shares of common stock acquirable upon complete conversion of all
Series O Preferred Stock then held.
We
are prohibited from effecting a conversion of the Series O
Preferred Stock to the extent that, as a result of such conversion,
the holder would beneficially own more than 4.99% of the number of
shares of common stock outstanding immediately after giving effect
to the issuance of shares of common stock upon conversion of the
Series O Preferred Stock, which beneficial ownership limitation may
be increased by the holder up to, but not exceeding, 9.99%. Each
holder is entitled to vote on all matters submitted to stockholders
of the Company, and shall have the number of votes equal to the
number of shares of common stock issuable upon conversion of such
holder’s Series O Preferred Stock, but not in excess of the
beneficial ownership limitations
,
and except that the holder may not vote for approval of shares of
Common Stock issuable upon conversion of Series O Preferred Stock
at any meeting of the Company's stockholders.
The foregoing description of the Series O Preferred Stock is not
complete and is qualified in its entirety by reference to the full
text of the Form of Series O Certificate of Designations, a copy of
which is filed as Exhibit 3.3 to this report and is incorporated by
reference herein.
Item 7.01
Regulation FD Disclosure
On May 3, 2018, the Company issued a press release
announcing the offering
.
A copy
of the press release is attached hereto as Exhibit
99.1.
The
information disclosed under this Item 7.01, including Exhibit 99.1
hereto, is being furnished and shall not be deemed
“filed” for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, nor shall it be incorporated by
reference into any registration statement or other document
pursuant to the Securities Act of 1933, as amended, except as
expressly set forth in such filing.
Item 9.01
Financial Statements and Exhibits.
(d)
Exhibits
|
|
Certificate of
Designations, Preferences and Rights of the 0% Series N Convertible
Preferred Stock
|
|
|
Certificate of
Correction to Certificate of Designations, Preferences and Rights
of the 0% Series N Convertible Preferred Stock
|
|
|
Certificate of
Designations, Preferences and Rights of the 0% Series O Convertible
Preferred Stock
|
|
|
Form
of Purchase Agreement
|
|
|
Form
of Registration Rights Agreement
|
|
|
Form
of May 2018 Letter Agreement
|
|
|
Press Release
dated May 3, 2018
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
|
|
|
MABVAX THERAPEUTICS HOLDINGS, INC.
|
|
|
Dated: May 3, 2018
|
/s/
J. David Hansen
|
|
J. David Hansen
|
|
President and Chief Executive Officer
|
Exhibit 3.1
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS OF
THE
0% SERIES N CONVERTIBLE PREFERRED STOCK OF
MABVAX THERAPEUTICS HOLDINGS, INC.
I, J.
David Hansen, hereby certify that I am the President and Chief
Executive Officer of MabVax Therapeutics Holdings, Inc. (the
“
Company
”), a
corporation organized and existing under the Delaware General
Corporation Law (the “
DGCL
”), and further do hereby
certify:
That
pursuant to the authority expressly conferred upon the Board of
Directors of the Company (the “
Board
”) by the Company’s
Certificate of Incorporation, as amended (the “
Certificate of Incorporation
”),
the Board on April 26, 2018, adopted the following resolutions
creating a series of shares of Preferred Stock designated as 0%
Series N Convertible Preferred Stock, none of which shares have
been issued, which, following filing of this Certificate of
Designations with the Secretary of State of the State of Delaware,
this Certificate of Designations shall be effective as of April 30,
2018:
RESOLVED, that the
Board designates the 0% Series N Convertible Preferred Stock and
the number of shares constituting such series, and fixes the
rights, powers, preferences, privileges and restrictions relating
to such series in addition to any set forth in the Certificate of
Incorporation as follows:
TERMS OF SERIES N CONVERTIBLE PREFERRED STOCK
1.
Designation
and Number of Shares
. There shall hereby be created and
established a series of preferred stock of the Company designated
as “0% Series N Convertible Preferred Stock” (the
“
Series N Preferred
Shares
”). The authorized number of Series N Preferred
Shares shall be 20,000 shares
. Each
Series N Preferred Share shall have $0.01 par value (the
“
Par
Value
”). Capitalized
terms not defined herein shall have the meaning as set forth in
Section
23
below.
2.
Ranking
.
The rights of all shares of capital stock of the Company (the
“
Junior Stock
”),
other than the Series D Preferred Stock, Series E Preferred Stock,
Series I Preferred Stock, Series J Preferred Stock, Series K
Preferred Stock, Series L Preferred Stock, and Series M Preferred
Stock shall be subject to the rights, powers, preferences and
privileges of the Series N Preferred Shares. In the event of the
merger or consolidation of the Company with or into another
corporation, the Series N Preferred Shares shall maintain their
relative rights, powers, designations, privileges and preferences
provided for herein and no such merger or consolidation shall
result inconsistent therewith.
3.
Dividends
. In addition to
Sections
5(a)
and
11
below, from and after the first date of
issuance of any Series N Preferred Shares (the “
Initial Issuance Date
”), each
holder of a Series N Preferred Share (each, a “
Holder
” and collectively, the
“
Holders
”) shall
be entitled to receive dividends (“
Dividends
”) when and as declared
by the Board, from time to time, in its sole discretion, which
Dividends shall be paid by the Company out of funds legally
available therefor, payable, subject to the conditions and other
terms hereof, in cash as if such Holders had converted the Series N
Preferred Shares into Common Stock (without regard to any
limitations on conversion) and had held such shares of Common Stock
on the record date for such dividends and distributions. Payments
under the preceding sentence shall be made concurrently with the
dividend or distribution to the holders of Common
Stock.
4.
Conversion
. Each Series N
Preferred Share shall be convertible into validly issued, fully
paid and non-assessable shares of Common Stock (as defined below)
on the terms and conditions set forth in this Section
4
.
(a)
Holder’s Conversion
Right
. Subject to the provisions of Section 4(e), at any
time or times on or after the Initial Issuance Date, each Holder
shall be entitled to convert any whole number of Series N Preferred
Shares into validly issued, fully paid and non-assessable shares of
Common Stock in accordance with Section
4
(c)
at the
Conversion Rate (as defined below).
(b)
Conversion Rate
. The number of
validly issued, fully paid and non-assessable shares of Common
Stock issuable upon conversion of each Series N Preferred Share
pursuant to Section
4
(a)
shall be determined according to the
following formula (the “
Conversion Rate
”):
Base Amount
Conversion
Price
No
fractional shares of Common Stock are to be issued upon the
conversion of any Series N Preferred Shares. If the issuance would
result in the issuance of a fraction of a share of Common Stock,
the Company shall round such fraction of a share of Common Stock up
to the nearest whole share.
(c)
Mechanics of Conversion
. The
conversion of each Series N Preferred Share shall be conducted in
the following manner:
(i)
Holder’s Conversion
. To
convert a Series N Preferred Share into validly issued, fully paid
and non-assessable shares of Common Stock on any date (a
“
Conversion
Date
”), a Holder shall deliver (whether via facsimile
or otherwise), for receipt on or prior to 11:59 p.m., New York
time, on such date, a copy of an executed notice of conversion of
the share(s) of Series N Preferred Shares subject to such
conversion in the form attached hereto as
Exhibit I
(the “
Conversion
Notice
”) to the Company. If required by Section
4
(c)
(vi)
, within
five (5) Trading Days following a conversion of any such Series N
Preferred Shares as aforesaid, such Holder shall surrender to a
nationally recognized overnight delivery service for delivery to
the Company the original certificates representing the share(s) of
Series N Preferred Shares (the “
Series N Preferred Share
Certificates
”) so converted as aforesaid.
(ii)
Company’s
Response
. On or before the first (1
st
) Trading Day
following the date of receipt of a Conversion Notice, the Company
shall transmit by facsimile an acknowledgment of confirmation, in
the form attached hereto as
Exhibit II
,
of receipt of such Conversion Notice to such Holder and the
Transfer Agent, which confirmation shall constitute an instruction
to the Transfer Agent to process such Conversion Notice in
accordance with the terms herein. On or before the second
(2
nd
)
Trading Day following the date of receipt by the Company of such
Conversion Notice, the Company shall (1) provided that the Transfer
Agent is participating in DTC Fast Automated Securities Transfer
Program, credit such aggregate number of shares of Common Stock to
which such Holder shall be entitled to such Holder’s or its
designee’s balance account with DTC through its
Deposit/Withdrawal at Custodian system, or (2) if the Transfer
Agent is not participating in the DTC Fast Automated Securities
Transfer Program, issue and deliver (via reputable overnight
courier) to the address as specified in such Conversion Notice, a
certificate, registered in the name of such Holder or its designee,
for the number of shares of Common Stock to which such Holder shall
be entitled. If the number of Series N Preferred Shares represented
by the Series N Preferred Share Certificate(s) submitted for
conversion pursuant to Section
4
(c)
(vi)
is greater than the number of Series N
Preferred Shares being converted, then the Company shall if
requested by such Holder, as soon as practicable and in no event
later than three (3) Trading Days after receipt of the Series N
Preferred Share Certificate(s) and at its own expense, issue and
deliver to such Holder (or its designee) a new Series N Preferred
Share Certificate representing the number of Series N Preferred
Shares not converted.
(iii)
Record
Holder
. The Person or Persons entitled to receive the shares
of Common Stock issuable upon a conversion of Series N Preferred
Shares shall be treated for all purposes as the record holder or
holders of such shares of Common Stock on the Conversion
Date.
(iv)
Company’s
Failure to Timely Convert
. If the Company shall fail, for
any reason or for no reason, to issue to a Holder within three (3)
Trading Days after the Company’s receipt of a Conversion
Notice (whether via facsimile or otherwise) (the
“
Share Delivery
Deadline
”), a certificate for the number of shares of
Common Stock to which such Holder is entitled and register such
shares of Common Stock on the Company’s share register or to
credit such Holder’s or its designee’s balance account
with DTC for such number of shares of Common Stock to which such
Holder is entitled upon such Holder’s conversion of any
Series N Preferred Shares (as the case may be) (a
“
Conversion
Failure
”), then, in addition to all other remedies
available to such Holder, such Holder, upon written notice to the
Company, may void its Conversion Notice with respect to, and retain
or have returned (as the case may be) any Series N Preferred Shares
that have not been converted pursuant to such Holder’s
Conversion Notice, provided that the voiding of a Conversion Notice
shall not affect the Company’s obligations to make any
payments which have accrued prior to the date of such notice
pursuant to the terms of this Certificate of Designations or
otherwise and (y) the Company shall pay in cash to such Holder on
each day after such third (3
rd
) Trading Day that
the issuance of such shares of Common Stock is not timely effected
an amount equal to 1.5% of the product of (A) the aggregate number
of shares of Common Stock not issued to such Holder on a timely
basis and to which the Holder is entitled and (B) the Closing Sale
Price of the Common Stock on the Trading Day immediately preceding
the last possible date on which the Company could have issued such
shares of Common Stock to the Holder without violating Section
4(c)
. In addition to the foregoing, if
within three (3) Trading Days after the Company’s receipt of
a Conversion Notice (whether via facsimile or otherwise), the
Company shall fail to issue and deliver a certificate to such
Holder and register such shares of Common Stock on the
Company’s share register or credit such Holder’s or its
designee’s balance account with DTC for the number of shares
of Common Stock to which such Holder is entitled upon such
Holder’s conversion hereunder (as the case may be), and if on
or after such third (3
rd
) Trading Day such
Holder (or any other Person in respect, or on behalf, of such
Holder) purchases (in an open market transaction or otherwise)
shares of Common Stock to deliver in satisfaction of a sale by such
Holder of all or any portion of the number of shares of Common
Stock, or a sale of a number of shares of Common Stock equal to all
or any portion of the number of shares of Common Stock, issuable
upon such conversion that such Holder so anticipated receiving from
the Company, then, in addition to all other remedies available to
such Holder, the Company shall, within three (3) Business Days
after such Holder’s request and in such Holder’s
discretion, either (i) pay cash to such Holder in an amount equal
to such Holder’s total purchase price (including brokerage
commissions and other out-of-pocket expenses, if any) for the
shares of Common Stock so purchased (including, without limitation,
by any other Person in respect, or on behalf, of such Holder) (the
“
Buy-In Price
”),
at which point the Company’s obligation to so issue and
deliver such certificate or credit such Holder’s balance
account with DTC for the number of shares of Common Stock to which
such Holder is entitled upon such Holder’s conversion
hereunder (as the case may be) (and to issue such shares of Common
Stock) shall terminate, or (ii) promptly honor its obligation to so
issue and deliver to such Holder a certificate or certificates
representing such shares of Common Stock or credit such
Holder’s balance account with DTC for the number of shares of
Common Stock to which such Holder is entitled upon such
Holder’s conversion hereunder (as the case may be) and pay
cash to such Holder in an amount equal to the excess (if any) of
the Buy-In Price over the product of (A) such number of shares of
Common Stock multiplied by (B) the lowest Closing Sale Price of the
Common Stock on any Trading Day during the period commencing on the
date of the applicable Conversion Notice and ending on the date of
such issuance and payment under this clause (ii).
(v)
Pro Rata Conversion; Disputes
.
In the event the Company receives a Conversion Notice from more
than one Holder for the same Conversion Date and the Company can
convert some, but not all, of such Series N Preferred Shares
submitted for conversion, the Company shall convert from each
Holder electing to have Series N Preferred Shares converted on such
date a pro rata amount of such Holder’s Series N Preferred
Shares submitted for conversion on such date based on the number of
Series N Preferred Shares submitted for conversion on such date by
such Holder relative to the aggregate number of Series N Preferred
Shares submitted for conversion on such date. In the event of a
dispute as to the number of shares of Common Stock issuable to a
Holder in connection with a conversion of Series N Preferred
Shares, the Company shall issue to such Holder the number of shares
of Common Stock not in dispute and resolve such dispute in
accordance with Section
22
.
(vi)
Book-Entry
. Notwithstanding
anything to the contrary set forth in this Section
4
, upon conversion of any Series N Preferred
Shares in accordance with the terms hereof, no Holder thereof shall
be required to physically surrender the certificate representing
the Series N Preferred Shares to the Company following conversion
thereof unless (A) the full or remaining number of Series N
Preferred Shares represented by the certificate are being converted
(in which event such certificate(s) shall be delivered to the
Company as contemplated by this Section
4
(c)
(vi)
) or (B) such Holder has provided the
Company with prior written notice (which notice may be included in
a Conversion Notice) requesting reissuance of Series N Preferred
Shares upon physical surrender of any Series N Preferred Shares.
Each Holder and the Company shall maintain records showing the
number of Series N Preferred Shares so converted by such Holder and
the dates of such conversions or shall use such other method,
reasonably satisfactory to such Holder and the Company, so as not
to require physical surrender of the certificate representing the
Series N Preferred Shares upon each such conversion. In the event
of any dispute or discrepancy, such records of such Holder
establishing the number of Series N Preferred Shares to which the
record holder is entitled shall be controlling and determinative in
the absence of manifest error. A Holder and any transferee or
assignee, by acceptance of a certificate, acknowledge and agree
that, by reason of the provisions of this paragraph, following
conversion of any Series N Preferred Shares, the number of Series N
Preferred Shares represented by such certificate may be less than
the number of Series N Preferred Shares stated on the face thereof.
Each certificate for Series N Preferred Shares shall bear the
following legend:
ANY
TRANSFEREE OR ASSIGNEE OF THIS CERTIFICATE SHOULD CAREFULLY REVIEW
THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS
RELATING TO THE SERIES N PREFERRED SHARES REPRESENTED BY THIS
CERTIFICATE, INCLUDING SECTION
4
(c)
(vi)
THEREOF. THE NUMBER OF SERIES N PREFERRED
SHARES REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER
OF SERIES N PREFERRED SHARES STATED ON THE FACE HEREOF PURSUANT TO
SECTION
4
(c)
(vi)
OF THE
CERTIFICATE OF DESIGNATIONS RELATING TO THE SERIES N PREFERRED
SHARES REPRESENTED BY THIS CERTIFICATE.
(d)
Taxes
. The Company shall pay
any and all documentary, stamp, transfer (but only in respect of
the registered holder thereof), issuance and other similar taxes
that may be payable with respect to the issuance and delivery of
shares of Common Stock upon the conversion of Series N Preferred
Shares.
(e)
Limitation on Beneficial
Ownership
. Notwithstanding anything to the contrary
contained in this Certificate of Designations, the Series N
Preferred Shares held by a Holder shall not be convertible by such
Holder, and the Company shall not effect any conversion of any
Series N Preferred Shares held by such Holder, to the extent (but
only to the extent) that such Holder or any of its affiliates would
beneficially own in excess of 4.99% (the “
Maximum Percentage
”) of the
Common Stock. To the extent the above limitation applies, the
determination of whether the Series N Preferred Shares held by such
Holder shall be convertible (vis-à-vis other convertible,
exercisable or exchangeable securities owned by such Holder or any
of its affiliates) and of which such securities shall be
convertible, exercisable or exchangeable (as among all such
securities owned by such Holder and its affiliates) shall, subject
to such Maximum Percentage limitation, be determined on the basis
of the first submission to the Company for conversion, exercise or
exchange (as the case may be). No prior inability of a Holder to
convert Series N Preferred Shares, or of the Company to issue
shares of Common Stock to such Holder, pursuant to this Section
4(e) shall have any effect on the applicability of the provisions
of this Section 4(e) with respect to any subsequent
determination of convertibility or issuance (as the case may be).
For purposes of this Section 4(e), beneficial ownership and all
determinations and calculations (including, without limitation,
with respect to calculations of percentage ownership) shall be
determined in accordance with Section 13(d) of the 1934 Act and the
rules and
regulations
promulgated thereunder. The provisions of this Section 4(e) shall
be implemented in a manner otherwise than in strict conformity with
the terms of this Section 4(e) to correct this Section 4(e) (or any
portion hereof) which may be defective or inconsistent with the
intended Maximum Percentage beneficial ownership limitation herein
contained or to make changes or supplements necessary or desirable
to properly give effect to such Maximum Percentage limitation. The
limitations contained in this Section 4(e) shall apply to a
successor holder of Series N Preferred Shares. The holders of
Common Stock shall be third party beneficiaries of this Section
4(e) and the Company may not waive this Section 4(e). For any
reason at any time, upon the written or oral request of a Holder,
the Company shall within two (2) Business Days confirm orally and
in writing to such Holder the number of shares of Common Stock then
outstanding, including by virtue of any prior conversion or
exercise of convertible or exercisable securities into Common
Stock, including, without limitation, pursuant to this Certificate
of Designations. By written notice to the Company, any Holder may
increase or decrease the Maximum Percentage to any other percentage
not in excess of 9.99% specified in such notice; provided that (i)
any such increase will not be effective until the 61st day after
such notice is delivered to the Company, and (ii) any such increase
or decrease will apply only to such Holder sending such notice and
not to any other Holder. For purposes hereof, in determining the
number of outstanding shares of Common Stock, the Holder may rely
on the number of outstanding shares of Common Stock as reflected in
(1) the Company’s most recent Annual Report on Form 10-K,
Quarterly Report on Form 10-Q, Current Report on Form 8-K or other
public filing with the Securities and Exchange Commission, as the
case may be, (2) a more recent public announcement by the Company,
or (3) any other notice by the Company setting forth the number of
shares of Common Stock outstanding. For any reason at any time,
upon the written or oral request of a holder of Series N Preferred
Shares, the Company shall within three (3) Business Days confirm
orally and in writing to such holder the number of shares of Common
Stock then outstanding. In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to
the conversion or exercise of securities of the Company, including
the Series N Preferred Shares, by the Holder and its Affiliates
since the date as of which such number of outstanding shares of
Common Stock was reported, that in any event are convertible or
exercisable, as the case may be, into shares of the Company’s
Common Stock within 60 days’ of such calculation and that are
not subject to a limitation on conversion or exercise analogous to
the limitation contained herein. The provisions of this paragraph
shall be construed and implemented in a manner in accordance with
Section 13(d) of the 1934 Act and the rules and regulations
promulgated thereunder.
(f)
19.99% Conversion Blocker.
Notwithstanding anything to the contrary set forth herein, the
Company shall not be obligated to issue any shares of Common Stock
upon conversion of the Series N Preferred Shares, and the Holder of
any Series N Preferred Shares shall not have the right to receive
upon conversion of any shares of the Series N Preferred Shares if
the issuance of such shares of Common Stock would exceed the
aggregate number of shares of Common Stock which the Company may
issue upon conversion of the Series N Preferred Shares without
breaching the Company's obligations under the rules or regulations
of the Nasdaq Capital Market, which aggregate number equals 19.99%
of the number of shares outstanding on February 2, 2018, or
2,088,836 shares of common stock (the “
Exchange Cap
”), except that such
limitation shall not apply in the event that the Company obtains
the approval of its stockholders as required by the applicable
rules of the Nasdaq Capital Market for issuances of Common Stock in
excess of such amount. Until such approval is obtained, no Holder
shall be issued in the aggregate, upon conversion of the Series N
Preferred Shares into shares of Common Stock in an amount greater
than the product of the Exchange Cap multiplied by a fraction, the
numerator of which is the total amount of shares of Common Stock
issuable to the Holder upon conversion of the Series N Preferred
Shares and the denominator of which is the total amount of shares
of Common Stock issuable to all Holders upon conversion of the
Series N Preferred Shares (with respect to each Holder, the
"
Exchange Cap Allocation
").
In the event that any Holder shall sell or otherwise transfer any
of such Holder's Series N Preferred Shares, the transferee shall be
allocated a pro rata portion of such Holder's Exchange Cap
Allocation, and the restrictions of the prior sentence shall apply
to such transferee with respect to the portion of the Exchange Cap
Allocation allocated to such transferee. In the event that any
Holder of Series N Preferred Shares shall convert all of such
Holder's Series N Preferred Shares into a number of shares of
Common Stock which, in the aggregate, is less than such Holder's
Exchange Cap Allocation, then the difference between such Holder's
Exchange Cap Allocation and the number of shares of Common Stock
actually issued to such Holder shall be allocated to the respective
Exchange Cap Allocations of the remaining Holders of shares of the
Series N Preferred Shares on a pro rata basis in proportion to the
aggregate Conversion Price of shares of the Series N Preferred
Shares then held by each such Holder.
5.
Rights Upon Issuance of Purchase
Rights and Other Corporate Events
.
(a)
Purchase Rights
. In addition to
any adjustments pursuant to Section 7 below, if at any time the
Company grants, issues or sells any Options, Convertible Securities
or rights to purchase stock, warrants, securities or other property
pro rata to all of the record holders of any class of Common Stock
(the “
Purchase
Rights
”), then each Holder will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the
aggregate Purchase Rights which such Holder could have acquired if
such Holder had held the number of shares of Common Stock
acquirable upon complete conversion of all the Series N Preferred
Shares (without taking into account any limitations or restrictions
on the convertibility of the Series N Preferred Shares) held by
such Holder immediately before the date on which a record is taken
for the grant, issuance or sale of such Purchase Rights, or, if no
such record is taken, the date as of which the record holders of
Common Stock are to be determined for the grant, issue or sale of
such Purchase Rights (provided, however, to the extent that such
Holder’s right to participate in any such Purchase Right
would result in such Holder exceeding the Maximum Percentage, then
such Holder shall not be entitled to participate in such Purchase
Right to such extent (or beneficial ownership of such shares of
Common Stock as a result of such Purchase Right to such extent) and
such Purchase Right to such extent shall be held in abeyance for
such Holder until such time, if ever, as its right thereto would
not result in such Holder exceeding the Maximum
Percentage).
(b)
Other Corporate Events
. In
addition to and not in substitution for any other rights hereunder,
prior to the consummation of any Fundamental Transaction pursuant
to which holders of shares of Common Stock are entitled to receive
securities or other assets with respect to or in exchange for
shares of Common Stock (a “
Corporate Event
”), the Company
shall make appropriate provision to insure that each Holder will
thereafter have the right to receive upon a conversion of all the
Series N Preferred Shares held by such Holder (i) in addition to
the shares of Common Stock receivable upon such conversion, such
securities or other assets to which such Holder would have been
entitled with respect to such shares of Common Stock had such
shares of Common Stock been held by such Holder upon the
consummation of such Corporate Event (without taking into account
any limitations or restrictions on the convertibility of the Series
N Preferred Shares contained in this Certificate of Designations)
or (ii) in lieu of the shares of Common Stock otherwise receivable
upon such conversion, such securities or other assets received by
the holders of shares of Common Stock in connection with the
consummation of such Corporate Event in such amounts as such Holder
would have been entitled to receive had the Series N Preferred
Shares held by such Holder initially been issued with conversion
rights for the form of such consideration (as opposed to shares of
Common Stock) at a conversion rate for such consideration
commensurate with the Conversion Rate. The provisions of this
Section
5(b)
shall apply similarly and
equally to successive Corporate Events and shall be applied without
regard to any limitations on the conversion of the Series N
Preferred Shares contained in this Certificate of
Designations.
6.
Rights Upon Fundamental
Transactions
. Upon the occurrence of any Fundamental
Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such
Fundamental Transaction, the provisions of this Certificate of
Designations referring to the “Company” shall refer
instead to the Successor Entity), and may exercise every right and
power of the Company and shall assume all of the obligations of the
Company under this Certificate of Designations with the same effect
as if such Successor Entity had been named as the Company herein
and therein. In addition to the foregoing, upon consummation of a
Fundamental Transaction, the Successor Entity shall deliver to each
Holder confirmation that there shall be issued upon conversion of
the Series N Preferred Shares at any time after the consummation of
such Fundamental Transaction, in lieu of the shares of Common Stock
(or other securities, cash, assets or other property (except such
items still issuable under Sections 5 and
11
, which shall continue to be receivable
thereafter)) issuable upon the conversion of the Series N Preferred
Shares prior to such Fundamental Transaction, such shares of the
Successor Entity (including its Parent Entity) or other
consideration which each Holder would have been entitled to receive
upon the happening of such Fundamental Transaction had all the
Series N Preferred Shares held by each Holder been converted
immediately prior to such Fundamental Transaction (without regard
to any limitations on the conversion of the Series N Preferred
Shares contained in this Certificate of Designations), as adjusted
in accordance with the provisions of this Certificate of
Designations. The provisions of this Section
6
shall apply similarly and equally to
successive Fundamental Transactions and shall be applied without
regard to any limitations on the conversion of the Series N
Preferred Shares.
7.
Rights Upon
Issuance of Other Securities.
(a)
For so long as the
Holder has Series N Preferred Stock, if the Company at any time on
or after the Initial Issuance Date issues or sells, or is deemed to
have sold, Common Stock, or common equivalent shares, for
consideration per share less than the Conversion Price in effect
immediately prior to the issuance (the “Lower Issuance
Price”), then the Conversion Price in effect immediately
prior to such issuance will be adjusted to the Lower Issuance
Price, provided however the Lower Issuance Price shall not be less
than $0.10. Notwithstanding the foregoing, the adjustment provided
for in this Section 7 (a) shall not apply to the issuance of
Company capital stock upon exercise of options or restricted stock
granted prior to the date hereof pursuant to employee benefit plans
approved by the Company’s Board of Directors.
(b)
Adjustment of
Conversion Price upon Subdivision or Combination of Common Stock.
Without limiting any provision of Sections 5 and
11
, if the Company at any time on or after the
Initial Issuance Date subdivides (by any stock split, stock
dividend, recapitalization or otherwise) one or more classes of its
outstanding shares of Common Stock into a greater number of shares,
the Conversion Price in effect immediately prior to such
subdivision will be proportionately reduced. Without limiting any
provision of Sections 5 and
11
, if the
Company at any time on or after the Initial Issuance Date combines
(by combination, reverse stock split or otherwise) one or more
classes of its outstanding shares of Common Stock into a smaller
number of shares, the Conversion Price in effect immediately prior
to such combination will be proportionately increased. Any
adjustment pursuant to this Section 7
(b)
shall become effective immediately after
the effective date of such subdivision or combination. If any event
requiring an adjustment under this Section 7
(b)
occurs during the period that a Conversion
Price is calculated hereunder, then the calculation of such
Conversion Price shall be adjusted appropriately to reflect such
event.
(c)
Other Events.
In the event that the Company (or any Subsidiary) shall take any
action to which the provisions hereof are not strictly applicable,
or, if applicable, would not operate to protect any Holder from
dilution or if any event occurs of the type contemplated by the
provisions of this Section 7 but not expressly provided for by such
provisions (including, without limitation, the granting of stock
appreciation rights, phantom stock rights or other rights with
equity features), then the Board shall in good faith determine and
implement an appropriate adjustment in the Conversion Price so as
to protect the rights of such Holder, provided that no such
adjustment pursuant to this Section 7
(c)
will increase the Conversion Price as
otherwise determined pursuant to this Section 7, provided further
that if such Holder does not accept such adjustments as
appropriately protecting its interests hereunder against such
dilution, then the Board and such Holder shall agree, in good
faith, upon an independent investment bank of nationally recognized
standing to make such appropriate adjustments, whose determination
shall be final and binding and whose fees and expenses shall be
borne by the Company.
(d)
Calculations. All
calculations under this Section 7 shall be made by rounding to the
nearest one-hundred thousandth of a cent or the nearest
1/100
th
of
a share, as applicable. The number of shares of Common Stock
outstanding at any given time shall not include shares owned or
held by or for the account of the Company, and the disposition of
any such shares shall be considered an issue or sale of Common
Stock.
8.
Authorized Shares
.
(a)
Reservation
. The Company shall
initially reserve out of its authorized and unissued Common Stock a
number of shares of Common Stock equal to 100% of the Conversion
Rate with respect to the Base Amount of each Series N Preferred
Share as of the Initial Issuance Date (without taking into account
any limitations on the conversion of such Series N Preferred Shares
set forth in herein) issuable pursuant to the terms of this
Certificate of Designations from the Initial Issuance Date through
the second anniversary of the Initial Issuance Date assuming
(without taking into account any limitations on the issuance of
securities set forth herein). So long as any of the Series N
Preferred Shares are outstanding, the Company shall take all action
necessary to reserve and keep available out of its authorized and
unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the Series N Preferred Shares, as of
any given date, 100% of the number of shares of Common Stock as
shall from time to time be necessary to effect the conversion of
all of the Series N Preferred Shares issued as of the Initial
Issuance Date, without taking into account any limitations on the
issuance of securities set forth herein), provided that at no time
shall the number of shares of Common Stock so available be less
than the number of shares required to be reserved by the previous
sentence (without regard to any limitations on conversions
contained in this Certificate of Designations) (the
“
Required
Amount
”). The initial number of shares of Common Stock
reserved for conversions of the Series N Preferred Shares and each
increase in the number of shares so reserved shall be allocated pro
rata among the Holders based on the number of Series N Preferred
Shares held by each Holder on the Initial Issuance Date or increase
in the number of reserved shares (as the case may be) (the
“
Authorized Share
Allocation
”). In the event a Holder shall sell or
otherwise transfer any of such Holder’s Series N Preferred
Shares, each transferee shall be allocated a pro rata portion of
such Holder’s Authorized Share Allocation. Any shares of
Common Stock reserved and allocated to any Person which ceases to
hold any Series N Preferred Shares shall be allocated to the
remaining Holders of Series N Preferred Shares, pro rata based on
the number of Series N Preferred Shares then held by such
Holders.
(b)
Insufficient Authorized Shares
.
If, notwithstanding Section 8
(a)
and
not in limitation thereof, at any time while any of the Series N
Preferred Shares remain outstanding the Company does not have a
sufficient number of authorized and unissued shares of Common Stock
to satisfy its obligation to have available for issuance upon
conversion of the Series N Preferred Shares at least a number of
shares of Common Stock equal to the Required Amount (an
“
Authorized Share
Failure
”), then the Company shall promptly take all
action necessary to increase the Company’s authorized shares
of Common Stock to an amount sufficient to allow the Company to
reserve and have available the Required Amount for all of the
Series N Preferred Shares then outstanding. Without limiting the
generality of the foregoing sentence, as soon as practicable after
the date of the occurrence of an Authorized Share Failure, but in
no event later than ninety (90) days after the occurrence of such
Authorized Share Failure, the Company shall hold a meeting of its
stockholders or conduct a consent solicitation for the approval of
an increase in the number of authorized shares of Common Stock. In
connection with such meeting, the Company shall provide each
stockholder with a proxy statement and shall use its commercially
reasonable efforts to solicit its stockholders’ approval of
such increase in authorized shares of Common Stock and to cause its
Board to recommend to the stockholders that they approve such
proposal. In the event that the Company is prohibited from issuing
shares of Common Stock upon a conversion of any Series N Preferred
Share due to the failure by the Company to have sufficient shares
of Common Stock available out of the authorized but unissued shares
of Common Stock (such unavailable number of shares of Common Stock,
the “
Authorization Failure
Shares
”), in lieu of delivering such Authorization
Failure Shares to such Holder of such Series N Preferred Shares,
the Company shall pay cash in exchange for the cancellation of such
Series N Preferred Shares convertible into such Authorized Failure
Shares at a price equal to the sum of (i) the product of (x) such
number of Authorization Failure Shares and (y) the Closing Sale
Price on the Trading Day immediately preceding the date such Holder
delivers the applicable Conversion Notice with respect to such
Authorization Failure Shares to the Company and (ii) to the extent
such Holder purchases (in an open market transaction or otherwise)
shares of Common Stock to deliver in satisfaction of a sale by such
Holder of Authorization Failure Shares, any brokerage commissions
and other out-of-pocket expenses, if any, of such Holder incurred
in connection therewith.
9.
Voting Rights
. Except as
otherwise expressly required by law, each holder of Series N
Preferred Shares shall be entitled to vote on all matters submitted
to shareholders of the Company and shall be entitled to the number
of votes for each Series N Preferred Share owned at the record date
for the determination of shareholders entitled to vote on such
matter or, if no such record date is established, at the date such
vote is taken or any written consent of shareholders is solicited,
equal to the number of shares of Common Stock such Series N
Preferred Shares are convertible into (voting as a class with
Common Stock) substituting the consolidated Closing Bid Price on
the date prior to execution of the Purchase Agreement for the
Conversion Rate in Section 4(b) hereof, but not in excess of the
conversion limitations set forth in Section 4(e) or Section 4(f)
herein. Except as otherwise required by law, the holders of Series
N Preferred Shares shall vote together with the holders of Common
Stock on all matters and shall not vote as a separate
class.
10.
Liquidation, Dissolution,
Winding-Up
. In the event of a Liquidation Event, the Holders
shall be entitled to receive in cash out of the assets of the
Company, whether from capital or from earnings available for
distribution to its shareholders (the “
Liquidation Funds
”), before any
amount shall be paid to the holders of any of shares of Junior
Stock, an amount per Series N Preferred Share equal to the greater
of (a) the Par Value thereof on the date of such payment, and (b)
the amount per share such Holder would receive if such Holder
converted such Series N Preferred Shares into Common Stock
immediately prior to the date of such payment;
provided
,
however
, that, if the
Liquidation Funds are insufficient to pay the full amount due to
the Holders and holders of shares of Parity Stock (stock ranking
equal to the Series N Preferred Shares), then each Holder and each
holder of Parity Stock shall receive a percentage of the
Liquidation Funds equal to the full amount of Liquidation Funds
payable to such Holder and such holder of Parity Stock as a
liquidation preference, in accordance with their respective
certificate of designation (or equivalent), as a percentage of the
full amount of Liquidation Funds payable to all holders of Series N
Preferred Shares and all holders of shares of Parity Stock. To the
extent necessary, the Company shall cause such actions to be taken
by each of its Subsidiaries so as to enable, to the maximum extent
permitted by law, the proceeds of a Liquidation Event to be
distributed to the Holders in accordance with this Section 10. All
the preferential amounts to be paid to the Holders under this
Section 10 shall be paid or set apart for payment before the
payment or setting apart for payment of any amount for, or the
distribution of any Liquidation Funds of the Company to the holders
of shares of Junior Stock in connection with a Liquidation Event as
to which this Section 10 applies.
11.
Participation
. In addition to
any adjustments pursuant to Section
7(b)
, the Holders shall, as holders of Series
N Preferred Shares, be entitled to receive such dividends paid and
distributions made to the holders of shares of Common Stock to the
same extent as if such Holders had converted each Series N
Preferred Share held by each of them into shares of Common Stock
(without regard to any limitations on conversion herein or
elsewhere) and had held such shares of Common Stock on the record
date for such dividends and distributions. Payments under the
preceding sentence shall be made concurrently with the dividend or
distribution to the holders of shares of Common Stock (provided,
however, to the extent that a Holder’s right to participate
in any such dividend or distribution would result in such Holder
exceeding the Maximum Percentage, then such Holder shall not be
entitled to participate in such dividend or distribution to such
extent (or the beneficial ownership of any such shares of Common
Stock as a result of such dividend or distribution to such extent)
and such dividend or distribution to such extent shall be held in
abeyance for the benefit of such Holder until such time, if ever,
as its right thereto would not result in such Holder exceeding the
Maximum Percentage).
12.
Vote to Change the Terms of or Issue
Series N Preferred Shares
. In addition to any other rights
provided by law, except where the vote or written consent of the
holders of a greater number of shares is required by law or by
another provision of the Certificate of Incorporation, without
first obtaining the affirmative vote at a meeting duly called for
such purpose or the written consent without a meeting of the
Holders of Series N Preferred Shares representing a majority of
Series N Preferred Shares outstanding on such date (the
“
Required
Holders
”), voting together as a single class, the
Company shall not: (a) amend or repeal any provision of, or add any
provision to, its Certificate of Incorporation or bylaws, or file
any certificate of designations or articles of amendment of any
series of shares of preferred stock, if such action would adversely
alter or change in any respect the preferences, rights, privileges
or powers, or restrictions provided for the benefit, of the Series
N Preferred Shares, regardless of whether any such action shall be
by means of amendment to the Certificate of Incorporation or by
merger, consolidation or otherwise; (b) increase or decrease (other
than by conversion) the authorized number of Series N Preferred
Shares; (c) issue any Series N Preferred Shares after the Initial
Issuance Date; or (d) without limiting any provision of Section
16
, whether or not prohibited by the
terms of the Series N Preferred Shares, circumvent a right of the
Series N Preferred Shares.
13.
Intentionally
Omitted
.
14.
Lost or Stolen Certificates
.
Upon receipt by the Company of evidence reasonably satisfactory to
the Company of the loss, theft, destruction or mutilation of any
certificates representing Series N Preferred Shares (as to which a
written certification and the indemnification contemplated below
shall suffice as such evidence), and, in the case of loss, theft or
destruction, of an indemnification undertaking by the applicable
Holder to the Company in customary and reasonable form and, in the
case of mutilation, upon surrender and cancellation of the
certificate(s), the Company shall execute and deliver new
certificate(s) of like tenor and date.
15.
Remedies, Characterizations, Other
Obligations, Breaches and Injunctive Relief.
The remedies
provided in this Certificate of Designations shall be cumulative
and in addition to all other remedies available under this
Certificate of Designations, at law or in equity (including a
decree of specific performance and/or other injunctive relief), and
no remedy contained herein shall be deemed a waiver of compliance
with the provisions giving rise to such remedy. Nothing herein
shall limit any Holder’s right to pursue actual and
consequential damages for any failure by the Company to comply with
the terms of this Certificate of Designations. The Company
covenants to each Holder that there shall be no characterization
concerning this instrument other than as expressly provided herein.
Amounts set forth or provided for herein with respect to payments,
conversion and the like (and the computation thereof) shall be the
amounts to be received by a Holder and shall not, except as
expressly provided herein, be subject to any other obligation of
the Company (or the performance thereof). The Company acknowledges
that a breach by it of its obligations hereunder will cause
irreparable harm to the Holders and that the remedy at law for any
such breach may be inadequate. The Company therefore agrees that,
in the event of any such breach or threatened breach, each Holder
shall be entitled, in addition to all other available remedies, to
an injunction restraining any such breach or any such threatened
breach, without the necessity of showing economic loss and without
any bond or other security being required. The Company shall
provide all information and documentation to a Holder that is
requested by such Holder to enable such Holder to confirm the
Company’s compliance with the terms and conditions of this
Certificate of Designations.
16.
Noncircumvention
. The Company
hereby covenants and agrees that the Company will not, by amendment
of its Certificate of Incorporation, bylaws or through any
reorganization, transfer of assets, consolidation, merger, scheme
of arrangement, dissolution, issue or sale of securities, or any
other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Certificate of
Designations, and will at all times in good faith carry out all the
provisions of this Certificate of Designations and take all action
as may be required to protect the rights of the Holders. Without
limiting the generality of the foregoing or any other provision of
this Certificate of Designations, the Company (i) shall not
increase the par value of any shares of Common Stock receivable
upon the conversion of any Series N Preferred Shares above the
Conversion Price then in effect, (ii) shall take all such
actions as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and non-assessable
shares of Common Stock upon the conversion of Series N Preferred
Shares and (iii) shall, so long as any Series N Preferred Shares
are outstanding, take all action necessary to reserve and keep
available out of its authorized and unissued shares of Common
Stock, solely for the purpose of effecting the conversion of the
Series N Preferred Shares, the maximum number of shares of Common
Stock as shall from time to time be necessary to effect the
conversion of the Series N Preferred Shares then outstanding
(without regard to any limitations on conversion contained
herein).
17.
Failure
or Indulgence Not Waiver
. No failure or delay on the part of
a Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power, right or privilege preclude other or
further exercise thereof or of any other right, power or privilege.
No waiver shall be effective unless it is in writing and signed by
an authorized representative of the waiving party. This Certificate
of Designations shall be deemed to be jointly drafted by the
Company and all Holders and shall not be construed against any
Person as the drafter hereof.
18.
Notices
. The Company shall
provide each Holder of Series N Preferred Shares with prompt
written notice of all actions taken pursuant to the terms of this
Certificate of Designations, including in reasonable detail a
description of such action and the reason therefor. Whenever notice
is required to be given under this Certificate of Designations,
unless otherwise provided herein. Without limiting the generality
of the foregoing, the Company shall give written notice to each
Holder (i) promptly following any adjustment of the Conversion
Price, setting forth in reasonable detail, and certifying, the
calculation of such adjustment and (ii) at least fifteen (15) days
prior to the date on which the Company closes its books or takes a
record (A) with respect to any dividend or distribution upon the
Common Stock, (B) with respect to any grant, issuances, or sales of
any Options, Convertible Securities or rights to purchase stock,
warrants, securities or other property to all holders of shares of
Common Stock as a class or (C) for determining rights to vote with
respect to any Fundamental Transaction, dissolution or liquidation,
provided, in each case, that such information shall be made known
to the public prior to, or simultaneously with, such notice being
provided to any Holder.
19.
Transfer of Series N Preferred
Shares
. The Holder may transfer some or all of its Series N
Preferred Shares without the consent of the Company.
20.
Series N Preferred Shares
Register
. The Company shall maintain at its principal
executive offices (or such other office or agency of the Company as
it may designate by notice to the Holders), a register for the
Series N Preferred Shares, in which the Company shall record the
name, address and facsimile number of the Persons in whose name the
Series N Preferred Shares have been issued, as well as the name and
address of each transferee. The Company may treat the Person in
whose name any Series N Preferred Shares is registered on the
register as the owner and holder thereof for all purposes,
notwithstanding any notice to the contrary, but in all events
recognizing any properly made transfers.
21.
Stockholder Matters;
Amendment
.
(a)
Stockholder
Matters. Any stockholder action, approval or consent required,
desired or otherwise sought by the Company pursuant to the DGCL,
the Certificate of Incorporation, this Certificate of Designations
or otherwise with respect to the issuance of Series N Preferred
Shares may be effected by written consent of the Company’s
stockholders or at a duly called meeting of the Company’s
stockholders, all in accordance with the applicable rules and
regulations of the DGCL. This provision is intended to comply with
the applicable sections of the DGCL permitting stockholder action,
approval and consent affected by written consent in lieu of a
meeting.
(b)
Amendment. This
Certificate of Designations or any provision hereof may be amended
by obtaining the affirmative vote at a meeting duly called for such
purpose, or written consent without a meeting in accordance with
the DGCL, of the Required Holders, voting separate as a single
class, and with such other stockholder approval, if any, as may
then be required pursuant to the DGCL and the Certificate of
Incorporation.
(a)
Disputes Over Closing Bid Price,
Closing Sale Price, Conversion Price or Fair Market
Value.
(i)
In the case of a
dispute relating to a Closing Bid Price, a Closing Sale Price, a
Conversion Price or fair market value (as the case may be)
(including, without limitation, a dispute relating to the
determination of any of the foregoing), the Company or such
applicable Holder (as the case may be) shall submit the dispute via
facsimile (I) within two (2) Business Days after delivery of the
applicable notice giving rise to such dispute to the Company or
such Holder (as the case may be) or (II) if no notice gave rise to
such dispute, at any time after such Holder learned of the
circumstances giving rise to such dispute. If such Holder and the
Company are unable to resolve such dispute relating to such Closing
Bid Price, such Closing Sale Price, such Conversion Price, or such
fair market value (as the case may be) by 5:00 p.m. (New York time)
on the third (3
rd
) Business Day
following such delivery by the Company or such Holder (as the case
may be) of such dispute to the Company or such Holder (as the case
may be), then such Holder shall select an independent, reputable
investment bank to resolve such dispute.
(ii)
Such
Holder and the Company shall each deliver to such investment bank
(x) a copy of the initial dispute submission so delivered in
accordance with the first sentence of this Section
22(a)
and (y) written documentation supporting
its position with respect to such dispute, in each case, no later
than 5:00 p.m. (New York time) by the fifth (5
th
) Business Day
immediately following the date on which such Holder selected such
investment bank (the “
Dispute
Submission Deadline
”) (the documents referred to in
the immediately preceding clauses (x) and (y) are collectively
referred to herein as the “
Required Dispute Documentation
”)
(it being understood and agreed that if either such Holder or the
Company fails to so deliver all of the Required Dispute
Documentation by the Dispute Submission Deadline, then the party
who fails to so submit all of the Required Dispute Documentation
shall no longer be entitled to (and hereby waives its right to)
deliver or submit any written documentation or other support to
such investment bank with respect to such dispute and such
investment bank shall resolve such dispute based solely on the
Required Dispute Documentation that was delivered to such
investment bank prior to the Dispute Submission Deadline). Unless
otherwise agreed to in writing by both the Company and such Holder
or otherwise requested by such investment bank, neither the Company
nor such Holder shall be entitled to deliver or submit any written
documentation or other support to such investment bank in
connection with such dispute (other than the Required Dispute
Documentation).
(iii)
The
Company and such Holder shall cause such investment bank to
determine the resolution of such dispute and notify the Company and
such Holder of such resolution no later than ten (10) Business Days
immediately following the Dispute Submission Deadline. The fees and
expenses of such investment bank shall be borne solely by the
Company, and such investment bank’s resolution of such
dispute shall be final and binding upon all parties absent manifest
error.
(b)
Disputes Over Arithmetic Calculation
of the Conversion Rate.
(i)
In the case of a
dispute as to the arithmetic calculation of a Conversion Rate, the
Company or such Holder (as the case may be) shall submit the
disputed arithmetic calculation via facsimile (i) within two (2)
Business Days after delivery of the applicable notice giving rise
to such dispute to the Company or such Holder (as the case may be)
or (ii) if no notice gave rise to such dispute, at any time after
such Holder learned of the circumstances giving rise to such
dispute. If such Holder and the Company are unable to resolve such
disputed arithmetic calculation of such Conversion Rate by 5:00
p.m. (New York time) on the third (3
rd
) Business Day
following such delivery by the Company or such Holder (as the case
may be) of such disputed arithmetic calculation, then such Holder
shall select an independent, reputable accountant or accounting
firm to perform such disputed arithmetic calculation.
(ii)
Such
Holder and the Company shall each deliver to such accountant or
accounting firm (as the case may be) (x) a copy of the initial
dispute submission so delivered in accordance with the first
sentence of this Section
22(a)
and (y)
written documentation supporting its position with respect to such
disputed arithmetic calculation, in each case, no later than 5:00
p.m. (New York time) by the fifth (5
th
) Business Day
immediately following the date on which such Holder selected such
accountant or accounting firm (as the case may be) (the
“
Submission
Deadline
”) (the documents referred to in the
immediately preceding clauses (x) and (y) are collectively referred
to herein as the “
Required
Documentation
”) (it being understood and agreed that
if either such Holder or the Company fails to so deliver all of the
Required Documentation by the Submission Deadline, then the party
who fails to so submit all of the Required Documentation shall no
longer be entitled to (and hereby waives its right to) deliver or
submit any written documentation or other support to such
accountant or accounting firm (as the case may be) with respect to
such disputed arithmetic calculation and such accountant or
accounting firm (as the case may be) shall perform such disputed
arithmetic calculation based solely on the Required Documentation
that was delivered to such accountant or accounting firm (as the
case may be) prior to the Submission Deadline). Unless otherwise
agreed to in writing by both the Company and such Holder or
otherwise requested by such accountant or accounting firm (as the
case may be), neither the Company nor such Holder shall be entitled
to deliver or submit any written documentation or other support to
such accountant or accounting firm (as the case may be) in
connection with such disputed arithmetic calculation of the
Conversion Rate (other than the Required
Documentation).
(iii)
The
Company and such Holder shall cause such accountant or accounting
firm (as the case may be) to perform such disputed arithmetic
calculation and notify the Company and such Holder of the results
no later than ten (10) Business Days immediately following the
Submission Deadline. The fees and expenses of such accountant or
accounting firm (as the case may be) shall be borne solely by the
Company, and such accountant’s or accounting firm’s (as
the case may be) arithmetic calculation shall be final and binding
upon all parties absent manifest error.
(c)
Miscellaneous. The
Company expressly acknowledges and agrees that (i) this Section
22
constitutes an agreement to
arbitrate between the Company and such Holder (and constitutes an
arbitration agreement) under § 7501, et seq. of the New York
Civil Practice Law and Rules (“
CPLR
”) and that each party shall
be entitled to compel arbitration pursuant to CPLR § 7503(a)
in order to compel compliance with this Section
22
, (ii) the terms of this Certificate of
Designations shall serve as the basis for the selected investment
bank’s resolution of the applicable dispute, such investment
bank shall be entitled (and is hereby expressly authorized) to make
all findings, determinations and the like that such investment bank
determines are required to be made by such investment bank in
connection with its resolution of such dispute and in resolving
such dispute such investment bank shall apply such findings,
determinations and the like to the terms of this Certificate of
Designations, (iii) the terms of this Certificate of Designations
shall serve as the basis for the selected accountant’s or
accounting firm’s performance of the applicable arithmetic
calculation, (iv) for clarification purposes and without
implication that the contrary would otherwise be true, disputes
relating to matters described in Section
22(a)
shall be governed by Section
22(a)
and not by Section
22(b)
, (v) such Holder (and only such Holder),
in its sole discretion, shall have the right to submit any dispute
described in this Section
22
to any
state or federal court sitting in The City of New York, Borough of
Manhattan in lieu of utilizing the procedures set forth in this
Section
22
and (vi) nothing in this
Section
22
shall limit such Holder
from obtaining any injunctive relief or other equitable remedies
(including, without limitation, with respect to any matters
described in Section
22(a)
or Section
22(b)
).
23.
Certain Defined Terms
. For
purposes of this Certificate of Designations, the following terms
shall have the following meanings:
(a)
“
1934
Act
”
means
the Securities Exchange Act of
1934, as amended.
(b)
“
Base Amount
” means, with respect
to each Series N Preferred Share, as of the applicable date of
determination, the sum of (1) the Stated Value thereof, plus (2)
the Unpaid Dividend Amount thereon as of such date of
determination.
(c)
“
Bloomberg
” means Bloomberg,
L.P.
(d)
“
Business Day
” means any day other
than Saturday, Sunday or other day on which commercial banks in The
City of New York are authorized or required by law to remain
closed.
(e)
“
Closing Bid Price
” and
“
Closing Sale
Price
” means, for any security as of any date, the
last closing bid price and last closing trade price, respectively,
for such security on the Principal Market, as reported by
Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price
or the closing trade price (as the case may be) then the last bid
price or last trade price, respectively, of such security prior to
4:00:00 p.m., New York time, as reported by Bloomberg, or, if the
Principal Market is not the principal securities exchange or
trading market for such security, the last closing bid price or
last trade price, respectively, of such security on the principal
securities exchange or trading market where such security is listed
or traded as reported by Bloomberg, or if the foregoing do not
apply, the last closing bid price or last trade price,
respectively, of such security in the over-the-counter market on
the electronic bulletin board for such security as reported by
Bloomberg, or, if no closing bid price or last trade price,
respectively, is reported for such security by Bloomberg, the
average of the bid prices, or the ask prices, respectively, of any
market makers for such security as reported in the “pink
sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC).
If the Closing Bid Price or the Closing Sale Price cannot be
calculated for a security on a particular date on any of the
foregoing bases, the Closing Bid Price or the Closing Sale Price
(as the case may be) of such security on such date shall be the
fair market value as mutually determined by the Company and the
applicable Holder. If the Company and such Holder are unable to
agree upon the fair market value of such security, then such
dispute shall be resolved in accordance with the procedures in
Section
22
. All such determinations
shall be appropriately adjusted for any stock dividend, stock
split, stock combination or other similar transaction during such
period.
(f)
“
Common Stock
” means (i) the
Company’s shares of common stock, $0.01 par value per share,
and (ii) any capital stock into which such common stock shall have
been changed or any share capital resulting from a reclassification
of such common stock.
(g)
“
Conversion Price
” means, with
respect to each Series N Preferred Share, as of any Conversion Date
or other applicable date of determination, $1.10 subject to
adjustment as provided herein.
(h)
“
Convertible
Securities
” means any stock or other security (other
than Options) that is at any time and under any circumstances,
directly or indirectly, convertible into, exercisable or
exchangeable for, or which otherwise entitles the holder thereof to
acquire, any shares of Common Stock.
(i)
“
Eligible Market
” means The New
York Stock Exchange, the NYSE MKT, The Nasdaq Global Select Market,
The Nasdaq Global Market, The Nasdaq Capital Market, the
Over-the-Counter Bulletin Board, the OTCQB Marketplace or the OTCQX
(or any successor thereto).
(j)
“
Fundamental Transaction
” means
that (i) the Company or any of its Subsidiaries shall, directly or
indirectly, in one or more related transactions, (1) consolidate or
merge with or into (whether or not the Company or any of its
Subsidiaries is the surviving corporation) any other Person unless
immediately following the closing of such transaction or series of
related transactions the Persons holding more than 50% of the
Voting Stock of the Company prior to such closing continue to hold
more than 50% of the Voting Stock of the Company following such
closing, or (2) sell, lease, license, assign, transfer, convey or
otherwise dispose of all or substantially all of its respective
properties or assets to any other Person, or (3) assist any other
Person in making a purchase, tender or exchange offer that is
accepted by the holders of more than 50% of the outstanding shares
of Voting Stock of the Company (not including any shares of Voting
Stock of the Company held by the Person or Persons making or party
to, or associated or affiliated with the Persons making or party
to, such purchase, tender or exchange offer), or (4) consummate a
stock or share purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with any other Person whereby
such other Person acquires more than 50% of the outstanding shares
of Voting Stock of the Company (not including any shares of Voting
Stock of the Company held by the other Person or other Persons
making or party to, or associated or affiliated with the other
Persons making or party to, such stock or share purchase agreement
or other business combination) excluding any equity financing
transaction in which shares of Voting Stock are issued, or (5)
reorganize, recapitalize or reclassify the Common Stock, or (ii)
any “person” or “group” (as these terms are
used for purposes of Sections 13(d) and 14(d) of the 1934 Act and
the rules and regulations promulgated thereunder) is or shall
become the “beneficial owner” (as defined in Rule 13d-3
under the 1934 Act), directly or indirectly, of 50% of the
aggregate ordinary voting power represented by issued and
outstanding Voting Stock of the Company.
(k)
“
Liquidation Event
” means the
liquidation, dissolution or winding up of the affairs of the
Company, whether voluntary or involuntary. Notwithstanding the
foregoing, a consolidation or merger of the Company with or into
any other corporation or corporations, or a sale of all or
substantially all of the assets of the Company, or the effectuation
by the Company of a transaction or series of transactions in which
more than 50% of the voting shares of the Company is disposed of or
conveyed, shall be deemed to be a Liquidation Event.
(l)
“
Options
” means any rights,
warrants or options to subscribe for or purchase shares of Common
Stock or Convertible Securities.
(m)
“
Parent Entity
” of a Person means
an entity that, directly or indirectly, controls the applicable
Person and whose common stock or equivalent equity security is
quoted or listed on an Eligible Market, or, if there is more than
one such Person or Parent Entity, the Person or Parent Entity with
the largest public market capitalization as of the date of
consummation of the Fundamental Transaction.
(n)
“
Person
”
means an individual, a limited liability company, a partnership, a
joint venture, a corporation, a trust, an unincorporated
organization, any other entity or a government or any department or
agency thereof.
(o)
“
Principal
Market
” means The NASDAQ Capital Market.
(p)
“
Purchase Agreement
” means that
certain Stock Purchase Agreement by and among the Company and the
initial holders of the Series N Preferred Shares, dated as of the
Initial Issuance Date, as may be amended from time in accordance
with the terms thereof.
(q)
“
SEC
”
means the Securities and Exchange Commission or the successor
thereto.
(r)
“
Stated Value
” shall mean $110 per
share, subject to adjustment for stock splits, stock dividends,
recapitalizations, reorganizations, reclassifications,
combinations, subdivisions or other similar events occurring after
the Initial Issuance Date with respect to the Series N Preferred
Shares.
(s)
“
Subsidiaries
” means any Person in
which the Company, directly or indirectly, (I) owns any of the
outstanding capital stock or holds any equity or similar interest
of such Person or (II) controls or operates all or any part of the
business, operations or administration of such Person.
(t)
“
Successor Entity
” means the Person
(or, if so elected by the Required Holders, the Parent Entity)
formed by, resulting from or surviving any Fundamental Transaction
or the Person (or, if so elected by the Required Holders, the
Parent Entity) with which such Fundamental Transaction shall have
been entered into.
(u)
“
Trading Day
” means, as applicable,
(x) with respect to all price determinations relating to the Common
Stock, any day on which the Common Stock is traded on the Principal
Market, or, if the Principal Market is not the principal trading
market for the Common Stock, then on the principal securities
exchange or securities market on which the Common Stock is then
traded, provided that “Trading Day” shall not include
any day on which the Common Stock is scheduled to trade on such
exchange or market for less than 4.5 hours or any day that the
Common Stock is suspended from trading during the final hour of
trading on such exchange or market (or if such exchange or market
does not designate in advance the closing time of trading on such
exchange or market, then during the hour ending at 4:00:00 p.m.,
New York time) unless such day is otherwise designated as a Trading
Day in writing by the Required Holders or (y) with respect to all
determinations other than price determinations relating to the
Common Stock, any day on which The NASDAQ Stock Market (or any
successor thereto) is open for trading of securities.
(v)
“
Unpaid Dividend Amount
” means, as
of the applicable date of determination, with respect to each
Series N Preferred Share, all declared and unpaid Dividends on such
Series N Preferred Share.
(w)
“
Voting
Stock
” of a Person means capital stock of such Person
of the class or classes pursuant to which the holders thereof have
the general voting power to elect, or the general power to appoint,
at least a majority of the board of directors, managers, trustees
or other similar governing body of such Person (irrespective of
whether or not at the time capital stock of any other class or
classes shall have or might have voting power by reason of the
happening of any contingency).
24.
Disclosure
. Upon receipt or
delivery by the Company of any notice in accordance with the terms
of this Certificate of Designations, unless the Company has in good
faith determined that the matters relating to such notice do not
constitute material, non-public information relating to the Company
or any of its Subsidiaries, the Company shall simultaneously with
any such receipt or delivery publicly disclose such material,
non-public information on a Current Report on Form 8-K or
otherwise. In the event that the Company believes that a notice
contains material, non-public information relating to the Company
or any of its Subsidiaries, the Company so shall indicate to each
Holder contemporaneously with delivery of such notice, and in the
absence of any such indication, each Holder shall be allowed to
presume that all matters relating to such notice do not constitute
material, non-public information relating to the Company or its
Subsidiaries.
* * * *
*
IN
WITNESS WHEREOF, the Corporation has caused this Certificate of
Designations of Series N Convertible Preferred Stock of MabVax
Therapeutics Holdings, Inc. to be signed by its President and Chief
Executive Officer on this 30th day of April, 2018.
By:
/s/ J. David
Hansen
Name:
J. David Hansen
Title:
President and Chief Executive Officer
EXHIBIT I
MABVAX THERAPEUTICS HOLDINGS, INC.
CONVERSION NOTICE
Reference is made
to the Certificate of Designations, Preferences and Rights of the
Series N Convertible Preferred Stock of MabVax Therapeutics
Holdings, Inc. (the “
Certificate of Designations
”). In
accordance with and pursuant to the Certificate of Designations,
the undersigned hereby elects to convert the number of shares of
Series N Convertible Preferred Stock, $0.01 par value per share
(the “
Series N Preferred
Shares
”), of MabVax Therapeutics Holdings, Inc., a
Delaware corporation (the “
Company
”), indicated below into
shares of common stock, $0.01 par value per share (the
“
Common Stock
”),
of the Company, as of the date specified below.
Date of
Conversion:
Number
of Series N Preferred Shares to be
converted:
Share
certificate no(s). of Series N Preferred Shares to be
converted:
Tax ID
Number (If
applicable):
Conversion
Price:_________________________________________________________
Number
of shares of Common Stock to be
issued:
Please
issue the shares of Common Stock into which the Series N Preferred
Shares are being converted in the following name and to the
following address:
Issue
to:
Address:
_________________________________________
Telephone Number:
________________________________
Facsimile
Number:
Holder:
By:
Title:
Dated:_____________________________
Account
Number (if electronic book entry
transfer):
Transaction Code
Number (if electronic book entry
transfer):
EXHIBIT II
ACKNOWLEDGMENT
The
Company hereby acknowledges this Conversion Notice and hereby
directs
[ ]
to issue the above indicated number of shares of Common Stock in
accordance with the Irrevocable Transfer Agent Instructions dated
__________, 201_ from the Company and acknowledged and agreed to by
[ ].
MABVAX
THERAPEUTICS HOLDINGS, INC.
Name:
Title:
Exhibit 3.2
CERTIFICATE OF CORRECTION
OF
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS OF
THE
0% SERIES N CONVERTIBLE PREFERRED STOCK
OF
MABVAX THERAPEUTICS HOLDINGS, INC.
A Delaware Corporation
MabVax
Therapeutics Holdings, Inc., a corporation organized and existing
under the General Corporation Law of the State of Delaware (the
“Company”), in accordance with the provisions of
Section 103 thereof, DOES HEREBY CERTIFY:
1.
The name of the Company is MabVax Therapeutics Holdings,
Inc.
2.
A Certificate of Designation for 0% Series N Convertible Preferred
Stock of the Corporation (the “Certificate of
Designation”) was filed with the Secretary of State for the
State of Delaware on April 30, 2018, and the Certificate of
Designation requires correction as permitted by subsection (f) of
Section 103 of the General Corporation Law of the State of
Delaware.
3.
The inaccuracy or defect of the Certificate of Designation is that
the said Certificate of Designation inadvertently stated a number
of shares in Section 4(f) “19.99% Conversion
Blocker.”
4.
The Certificate of Designation is corrected by replacing Section
4(f) Paragraph (f) in its entirety with the following:
(f)
19.99% Conversion Blocker
.
Notwithstanding anything to the contrary set forth herein, the
Company shall not be obligated to issue any shares of Common Stock
upon conversion of the Series N Preferred Shares, and the Holder of
any Series N Preferred Shares shall not have the right to receive
upon conversion of any shares of the Series N Preferred Shares if
the issuance of such shares of Common Stock would exceed the
aggregate number of shares of Common Stock which the Company may
issue upon conversion of the Series N Preferred Shares without
breaching the Company's obligations under the rules or regulations
of the Nasdaq Capital Market, which aggregate number equals 19.99%
of the number of shares outstanding on February 2, 2018 (the
“
Exchange Cap
”),
except that such limitation shall not apply in the event that the
Company obtains the approval of its stockholders as required by the
applicable rules of the Nasdaq Capital Market for issuances of
Common Stock in excess of such amount. Until such approval is
obtained, no Holder shall be issued in the aggregate, upon
conversion of the Series N Preferred Shares into shares of Common
Stock in an amount greater than the product of the Exchange Cap
multiplied by a fraction, the numerator of which is the total
amount of shares of Common Stock issuable to the Holder upon
conversion of the Series N Preferred Shares and the denominator of
which is the total amount of shares of Common Stock issuable to all
Holders upon conversion of the Series N Preferred Shares (with
respect to each Holder, the "
Exchange Cap Allocation
"). In the event
that any Holder shall sell or otherwise transfer any of such
Holder's Series N Preferred Shares, the transferee shall be
allocated a pro rata portion of such Holder's Exchange Cap
Allocation, and the restrictions of the prior sentence shall apply
to such transferee with respect to the portion of the Exchange Cap
Allocation allocated to such transferee. In the event that any
Holder of Series N Preferred Shares shall convert all of such
Holder's Series N Preferred Shares into a number of shares of
Common Stock which, in the aggregate, is less than such Holder's
Exchange Cap Allocation, then the difference between such Holder's
Exchange Cap Allocation and the number of shares of Common Stock
actually issued to such Holder shall be allocated to the respective
Exchange Cap Allocations of the remaining Holders of shares of the
Series N Preferred Shares on a pro rata basis in proportion to the
aggregate Conversion Price of shares of the Series N Preferred
Shares then held by each such Holder.
* * * * *
IN WITNESS WHEREOF, the Company has caused this Certificate of
Correction to be executed as of the 2nd day of May,
2018.
By:
/s/ J. David
Hansen
Name: J.
David Hansen
Title:
President and Chief Executive Officer
Exhibit 3.3
CERTIFICATE OF DESIGNATION OF PREFERENCES,
RIGHTS AND LIMITATIONS
OF
SERIES O CONVERTIBLE PREFERRED STOCK
The
undersigned, Chief Executive Officer of MABVAX THERAPEUTICS
HOLDINGS, INC., a Delaware corporation (the
“Corporation”), DOES HEREBY CERTIFY that the following
resolutions were duly adopted by the Board of Directors of the
Corporation on April 26, 2018;
WHEREAS, the Board of Directors is
authorized
within the limitations and
restrictions stated in the Certificate of Incorporation of the
Corporation, as amended, to provide by resolution or resolutions
for the issuance of
Twenty
Thousand (20,000) shares of Preferred Stock,
par value $0.01 per share, of the Corporation, in
such series and with such designations, preferences and relative,
participating, optional or other special rights and qualifications,
limitations or restrictions as the Corporation’s Board of
Directors shall fix by resolution or resolutions providing for the
issuance thereof duly adopted by the Board of Directors;
and
WHEREAS, it is the desire of the Board of
Directors, pursuant to its authority as aforesaid, to authorize and
fix the terms of a series of Preferred Stock and the number of
shares constituting such series
;
NOW,
THEREFORE, BE IT RESOLVED:
Section
1.
Designation and
Authorized Shares
. The
Corporation shall be authorized to issue
Twenty Thousand (20,000) shares of Series O
Preferred Stock,
par value
$0.01 per share (the “Series O Preferred
Stock”).
Section
2.
Stated
Value
. Each share of Series O
Preferred Stock shall have a stated value of $0.01 per share
(as subject to adjustment in the case of any stock splits, stock
combination or similar recapitalization affecting the Series O
Preferred Stock as set forth herein)
(
the
“Stated Value”)
.
Section
3.
Liquidation
.
(a)
Upon
the liquidation, dissolution or winding up of the business of the
Corporation, whether voluntary or involuntary, each holder of
Series O Preferred Stock shall be entitled to receive, for each
share thereof, out of assets of the Corporation legally available
therefor, a preferential amount in cash equal to (and not more
than) the Stated Value. All preferential amounts to be paid to the
holders of Series O Preferred Stock in connection with such
liquidation, dissolution or winding up shall be paid before the
payment or setting apart for payment of any amount for, or the
distribution of any assets of the Corporation to the holders of (i)
any other class or series of capital stock whose terms expressly
provide that the holders of Series O Preferred Stock should receive
preferential payment with respect to such distribution (to the
extent of such preference) and (ii) the Corporation's Common
Stock
. If upon any such
distribution the assets of the Corporation shall be insufficient to
pay the holders of the outstanding shares of Series O Preferred
Stock (or the holders of any class or series of capital stock
ranking on a parity with the Series O Preferred Stock as to
distributions in the event of a liquidation, dissolution or winding
up of the Corporation) the full amounts to which they shall be
entitled, such holders shall share ratably in any distribution of
assets in accordance with the sums which would be payable on such
distribution if all sums payable thereon were paid in
full.
(b)
Any
distribution in connection with the liquidation, dissolution or
winding up of the Corporation, or any bankruptcy or insolvency
proceeding, shall be made in cash to the extent possible. Whenever
any such distribution shall be paid in property other than cash,
the value of such distribution shall be the fair market value of
such property as determined in good faith by the Board of Directors
of the Corporation.
Section
4.
Conversion
.
(a)
Conversion Right.
Each holder of Series O Preferred
Stock may, from time to time, convert any or all of such
holder’s shares of Series O Preferred Stock into fully paid
and non-assessable shares of Common Stock according to the
following formula:
Stated Value
Conversion
Price
“Conversion
Price” shall equal $0.0001.
Notwithstanding
anything herein to the contrary, if the Corporation has not
obtained the approval of its shareholders in accordance with the
rules of the Nasdaq Stock Market LLC for the conversion of Series N
Preferred Stock authorized on April 26, 2018 or the conversion of
Series O Preferred Stock (“Shareholder Approval”), then
the Corporation may not issue upon conversion of Series O Preferred
Stock any shares of Common Stock.
(b)
Conversion Procedure.
In order to exercise the conversion privilege under this Section 4,
the holder of any shares of Series O Preferred Stock to be
converted shall give written notice to the Corporation at its
principal office that such holder elects to convert such shares of
Series O Preferred Stock or a specified portion thereof into shares
of Common Stock as set forth in such notice (the “Conversion
Notice”, and such date of delivery of the Conversion Notice
to the Corporation, the “Conversion Notice Delivery
Date”). Within three (3) business days following the
Conversion Notice Delivery Date, the Corporation shall issue and
deliver a certificate or certificates representing the number of
shares of Common Stock determined pursuant to this Section 4 (the
“Share Delivery Date”). In case of conversion under
this Section 4 of only a part of the shares of Series O Preferred
Stock represented by a certificate surrendered to the Corporation,
the Corporation shall issue and deliver a new certificate for the
number of shares of Series O Preferred Stock which have not been
converted, upon receipt of the original certificate or certificates
representing shares of Series O Preferred Stock so converted. Until
such time as the certificate or certificates representing shares of
Series O Preferred Stock which have been converted are surrendered
to the Corporation and a certificate or certificates representing
the Common Stock into which such shares of Series O Preferred Stock
have been converted have been issued and delivered, the certificate
or certificates representing the shares of Series O Preferred Stock
which have been converted shall represent the shares of Common
Stock into which such shares of Series O Preferred Stock have been
converted. The Corporation shall pay all documentary, stamp or
similar issue or transfer tax due on the issue of shares of Common
Stock issuable upon conversion of the Series O Preferred
Stock.
(c)
Maximum
Conversion
.
(i)
Notwithstanding
anything to the contrary set forth in this Certificate of
Designation, at no time may all or a portion of shares of Series O
Preferred Stock be converted if the number of shares of Common
Stock to be issued pursuant to
such
conversion would exceed,
when aggregated with all other shares of Common Stock owned by such
holder at such time, the number of shares of Common Stock which
would result in such holder beneficially owning (as determined in
accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”) and the rules
thereunder) more than 4.99% of all of the Common Stock outstanding
at such time (the “4.99% Beneficial Ownership
Limitation”).
(ii)
By written notice
to the Corporation, any holder of Series O Preferred Stock may
increase or decrease the 4.99% Beneficial Ownership Limitation to
any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective
until the 61st day after such notice is delivered to the
Corporation, and (ii) any such increase or decrease will apply only
to such holder of Series O Preferred Stock sending such notice and
not to any other holder of Series O Preferred Stock.
(iii)
For purposes of
this Section 4, in determining the number of outstanding shares of
Common Stock, a holder of Series O Preferred Stock may rely on the
number of outstanding shares of Common Stock as reflected in (1)
the Corporation’s most recent Form 10-K, Form 10-Q, Current
Report on Form 8-K or other public filing with the Securities and
Exchange Commission, as the case may be, (2) a more recent public
announcement by the Corporation or (3) any other notice by the
Corporation setting forth the number of shares of Common Stock
outstanding. For any reason at any time, upon the written or oral
request of a holder of Series O Preferred Stock, the Corporation
shall within one (1) business day confirm orally and in writing to
such holder the number of shares of Common Stock then outstanding.
In any case, the number of outstanding shares of Common Stock shall
be determined after giving effect to the conversion or exercise of
securities of the Corporation, including shares of Series O
Preferred Stock, held by such holder and its affiliates since the
date as of which such number of outstanding shares of Common Stock
was reported, which in any event are convertible or exercisable, as
the case may be, into shares of the Corporation’s Common
Stock within sixty (60) days’ of such calculation and which
are not subject to a limitation on conversion or exercise analogous
to the limitation contained herein.
The provisions of this paragraph shall be
construed and implemented in a manner otherwise than in strict
conformity with the terms of this Section 4 to correct this
paragraph (or any portion hereof) which may be defective or
inconsistent with the intended beneficial ownership limitation
herein contained or to make changes or supplements necessary or
desirable to properly give effect to such
limitation
.
(d)
Buy-In.
If, by the Share
Delivery Date, and provided the Corporation has obtained
Shareholder Approval, the Corporation fails for any reason to
deliver the shares of Common Stock issuable upon conversion of the
Series O Preferred Stock, as set forth in the Conversion Notice,
and after such Share Delivery Date, the converting holder
purchases, in an arm’s length open market transaction or
otherwise, shares of Common Stock (the “Covering
Shares”) in order to make delivery in satisfaction of a sale
of Common Stock by the converting holder (the “Sold
Shares”), which delivery such converting holder anticipated
to make using the shares to be issued upon such conversion (a
“Buy-In”), the converting holder shall have the right
to require the Corporation to pay to the converting holder the
Buy-In Adjustment Amount. The Corporation shall pay the
Buy-In Adjustment Amount to the converting holder in immediately
available funds immediately upon demand by the converting holder.
For purposes of this Certificate of Designation, the term
“Buy-In Adjustment Amount” means the amount equal to
the excess, if any, of (i) the converting holder’s total
purchase price (including brokerage commissions, if any) for the
Covering Shares associated with a Buy-In, over (ii) the net
proceeds (after brokerage commissions, if any) received by the
converting holder from the sale of the Sold Shares. By
way of illustration and not in limitation of the foregoing, if the
converting holder purchases shares of Common Stock having a total
purchase price (including brokerage commissions) of $11,000 to
cover a Buy-In, with respect to shares of Common Stock it sold for
net proceeds of $10,000, the Buy-In Adjustment Amount which the
Corporation will be required to pay to the converting holder will
be $1,000.
Section
5.
Voting
.
Except as otherwise expressly required by law, each holder of
Series O Preferred Stock shall be entitled to vote on all matters
submitted to shareholders of the Corporation and shall be entitled
to the number of votes for each share of Series O Preferred Stock
owned at the record date for the determination of shareholders
entitled to vote on such matter or, if no such record date is
established, at the date such vote is taken or any written consent
of shareholders is solicited, equal to the number of shares of
Common Stock such shares of Series O Preferred Stock are
convertible into at such time,
substituting the consolidated
Closing Bid Price on April __, 2018 for the Conversion Price in
Section 4(a) hereof
but not in excess
of the conversion limitations set forth in Section 4
herein.
“Closing Bid
Price” means, for any security as of any date, the last
closing bid price and last closing trade price, respectively, for
such security on the Nasdaq Stock Market LLC (the “Principal
Market”), as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not
designate the closing bid price or the closing trade price (as the
case may be) then the last bid price or last trade price,
respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not
the principal securities exchange or trading market for such
security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as
reported by Bloomberg, or if the foregoing do not apply, the last
closing bid price or last trade price, respectively, of such
security in the over-the-counter market on the electronic bulletin
board for such security as reported by Bloomberg, or, if no closing
bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask
prices, respectively, of any market makers for such security as
reported in the “pink sheets” by OTC Markets Group Inc.
(formerly Pink Sheets LLC). If the Closing Bid Price cannot be
calculated for a security on a particular date on any of the
foregoing bases, the Closing Bid Price of such security on such
date shall be the fair market value as mutually determined by the
Company and the applicable Holder. All such determinations shall be
appropriately adjusted for any stock dividend, stock split, stock
combination or other similar transaction during such
period.
Section
6.
Other
Provisions.
(a)
Reservation
of Common Stock
.
The
Corporation shall at all times reserve
from its authorized Common Stock a sufficient number of shares to
provide for conversion of all Series O Preferred Stock from time to
time outstanding.
(b)
Record
Holders
. The Corporation and
its transfer agent, if any, for the Series O Preferred Stock may
deem and treat the record holder of any shares of Series O
Preferred Stock as reflected on the books and records of the
Corporation as the sole true and lawful owner thereof for all
purposes, and neither the Corporation nor any such transfer agent
shall be affected by any notice to the
contrary.
Section
7.
Restriction and Limitations
.
Except as expressly provided herein or as required by law so long
as any shares of Series O Preferred Stock remain outstanding, the
Corporation shall not, without the vote or written consent of the
holders of at least a majority of the then outstanding shares of
the Series O Preferred Stock, take any action which would adversely
and materially affect any of the preferences, limitations or
relative rights of the Series O Preferred Stock.
Section
8.
Certain
Adjustments
.
(a)
Stock Dividends and Stock
Splits
. If the Corporation, at any time while the Series O
Preferred Stock is outstanding: (A) shall pay a stock dividend or
otherwise make a distribution or distributions on shares of its
Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt,
shall not include any shares of Common Stock issued by the
Corporation pursuant to the conversion of the Series O Preferred
Stock), (B) subdivide outstanding shares of Common Stock into a
larger number of shares, (C) combine (including by way of reverse
stock split) outstanding shares of Common Stock into a smaller
number of shares, or (D) issue by reclassification of shares of the
Common Stock any shares of capital stock of the Corporation, each
share of Series O Preferred Stock shall receive such consideration
as if such number of shares of Series O Preferred had been,
immediately prior to such foregoing dividend, distribution,
subdivision, combination or reclassification, the holder of the
number of shares of Common Stock into which it could convert at
such time. Any adjustment made pursuant to this Section shall
become effective immediately after the record date for the
determination of stockholders entitled to receive such dividend or
distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or
re-classification.
Section
9.
Equal Treatment of Holders
. No
consideration (including any modification of this Certificate of
Designation or related transaction document) shall be offered or
paid to any person or entity to amend or consent to a waiver or
modification of any provision of this Certificate of Designation or
related transaction document unless the same consideration is also
offered to all of holders of the outstanding shares of Series O
Preferred Stock. For clarification purposes, this provision
constitutes a separate right granted to each holder by the
Corporation and negotiated separately by each holder, and is
intended for the Corporation to treat all holders of the Series O
Preferred Stock as a class and shall not in any way be construed as
such holders acting in concert or as a group with respect to the
purchase, disposition or voting of the Series O Preferred Stock or
otherwise.
[signature page follows]
IN
WITNESS WHEREOF, the undersigned has executed this Certificate this
30th day of April 2018.
By: /s/ J. David
Hansen
Name:
J. David Hansen
Title:
President and CEO
Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this
“
Agreement
”)
is dated as of _____, 2018 between MabVax Therapeutics Holdings,
Inc., a Delaware corporation (the “
Company
”),
and each purchaser identified on the signature pages hereto (each,
including its successors and permitted assigns, a
“
Purchaser
”
and collectively, the “
Purchasers
”).
PREAMBLE
WHEREAS, subject to the terms and conditions set
forth in this Agreement and pursuant to Section 4(a)(2) of the
Securities Act of 1933, as amended (the “
Securities
Act
”), and Rule 506
promulgated thereunder or Regulation S promulgated under the
Securities Act, the Company desires to issue and sell to each
Purchaser, and each Purchaser, severally and not jointly, desires
to purchase from the Company, securities of the Company as more
fully described in this Agreement (the “
Offering
”).
NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Company
and each Purchaser agree as follows:
ARTICLE I.
DEFINITIONS
1.1
Definitions
.
In addition to the terms defined elsewhere in this Agreement, for
all purposes of this Agreement, the following terms have the
meanings set forth in this Section 1.1:
“
Accredited
Investor
” shall have the
meaning ascribed to it in Section 3.2(c).
“
Affiliate
”
means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed
under Rule 405 under the Securities Act.
“
Board of
Directors
” means the
board of directors of the Company.
“
Business
Day
” means any day except
any Saturday, any Sunday, any day which is a federal legal holiday
in the United States or any day on which banking institutions in
the State of New York are authorized or required by law or other
governmental action to close.
“
Certificate of
Designation
” means the
Certificate of Designations, Preferences and Rights of the
Preferred Shares to be filed prior to the Closing by the Company
with the Secretary of State of Delaware, in the form of
Exhibit
A
attached
hereto.
“
Closing
”
means the closing of the purchase and sale of the Securities
pursuant to Section 2.1.
“
Closing
Date
” means the Trading
Day on which all of the Transaction Documents have been executed
and delivered by the applicable parties thereto, and all conditions
precedent to (i) the Purchasers’ obligations to pay the
Subscription Amount at such Closing and (ii) the Company’s
obligations to deliver the Securities to be issued and sold at such
Closing, in each case, have been satisfied or waived, but in no
event later than the third Trading Day following the date hereof in
the case of such Closing.
“
Commission
”
means the United States Securities and Exchange
Commission.
“
Common
Stock
” means the common
stock of the Company, $0.01 par value per share, and any other
class of securities into which such securities may hereafter be
reclassified or changed.
“
Company
Counsel
” means such firm
or firms as may from time to time provide legal services to the
Company.
“
Conversion
Shares
” means the shares
of the Company’s Common Stock issuable upon conversion of the
Preferred Shares.
“
Exchange
Act
” means the Securities
Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
“
FCPA
”
means the Foreign Corrupt Practices Act of 1977, as
amended.
“
GAAP
”
shall have the meaning ascribed to such term in Section
3.1(g).
“
Liens
”
means a lien, charge pledge, security interest, encumbrance, right
of first refusal, preemptive right or other
restriction.
“
Majority in
Interest
” shall have the
meaning ascribed to such term in Section 5.5.
“
Material Adverse
Effect
” shall have the
meaning assigned to such term in Section
3.1(b).
“
Maximum Rate
” shall have
the meaning ascribed to such term in Section 5.21.
“
Offering
”
shall have the meaning ascribed to such term in the
Preamble.
“
Per Share Purchase
Price
” equals $1.10 per
Share, subject to adjustment for reverse and forward stock splits,
stock dividends, and other similar transactions affecting the
Common Stock that occur after the date of this Agreement and prior
to Closing.
“
Person
”
means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any
kind.
“
Preferred
Shares
” means the
Company’s newly designated Series N Convertible Preferred
Stock, par value $0.01 per share, which are convertible into shares
of Common Stock, with such rights and designations as set forth in
the form of Certificate of Designations.
“
Proceeding
”
means an action, claim, suit, investigation or proceeding
(including, without limitation, an informal investigation or
partial proceeding, such as a deposition), whether commenced or
threatened.
“
Registration Rights
Agreement
” means the
Registration Rights Agreement, dated the date hereof, among the
Company and the Purchasers, in the form of
Exhibit C
attached hereto.
“
Registration
Statement
” means a
registration statement meeting the requirements set forth in the
Registration Rights Agreement and covering the resale of the Shares
by each Purchaser as provided for in the Registration Rights
Agreement.
“
Required
Approvals
” shall have the
meaning ascribed to such term in Section
3.1(e).
“
Rule
144
” means Rule 144
promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended or interpreted from time to time, or any
similar rule or regulation hereafter adopted by the Commission
having substantially the same purpose and effect as such
Rule.
“
SEC
Reports
” shall
mean
all reports, schedules, forms, statements and other
documents filed by the Company under the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the three (3)
months preceding the date hereof, including the exhibits thereto
and documents incorporated by reference therein, which have been
available on EDGAR not less than five (5) days before the Closing
Date
.
“
Securities
”
means Shares and Conversion Shares.
“
Securities
Act
” means the Securities
Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
“
Securities Laws
” means
the securities laws of the United States or any state thereof and
the rules and regulations promulgated thereunder.
“
Shares
”
means the shares of Common Stock or, at the election of each
Purchaser, Preferred Shares delivered to the Purchasers, as the
case may be, pursuant to this Agreement in connection with the
Closing.
“
Short
Sales
” means all
“short sales” as defined in Rule 200 of Regulation SHO
under the Exchange Act (but shall not be deemed to include the
location and/or reservation of borrowable shares of Common
Stock).
“
Subscription
Amount
” means, as to each
Purchaser at the Closing, the aggregate amount of cash
consideration to be paid for Shares purchased hereunder at the
Closing as specified below such Purchaser’s name on the
signature page of this Agreement and next to the heading
“Subscription Amount,” in United States dollars and in
immediately available funds.
“
Subsidiary
”
means any subsidiary of the Company and shall, where applicable and
with regard to future events, also include any direct or indirect
subsidiary of the Company formed or acquired after the date
hereof.
“
Termination Date
” shall
have the meaning ascribed to such term in Section 2.1.
“
Trading Day
” means a day
on which the principal Trading Market is open for trading;
provided, that in the event that the Common Stock is not listed or
quoted for trading on a Trading Market on the date in question,
then Trading Day shall mean a Business Day.
“
Trading Market
” means any
of the following markets or exchanges on which the Common Stock is
listed or quoted for trading on the date in question: the NYSE MKT,
the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq
Global Select Market, the New York Stock Exchange, the OTC Bulletin
Board, the OTCQB or the OTCQX (or any successors to any of the
foregoing).
“
Transaction
Documents
” means this
Agreement, the Certificate of Designations, the Registration Rights
Agreement, all exhibits and schedules thereto and hereto and any
other documents or agreements executed in connection with the
transactions contemplated hereunder.
“
Transfer
Agent
” means
Computershare Trust Company, N.A. Its address is 250 Royall Street,
Canton, MA 02021, and any successor transfer agent of the
Company.
“
Share Purchase
Price
” shall have the
meaning ascribed to such term in Section 2.1.
“
VWAP
”
means, for any date, the price determined by the first of the
following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted
average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is
then listed or quoted as reported by Bloomberg L.P. (based on a
Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New
York City time)), (b) if the OTC Bulletin Board is not a
Trading Market, the volume weighted average price of the Common
Stock for such date (or the nearest preceding date) on the OTC
Bulletin Board, (c) if the Common Stock is not then listed or
quoted for trading on the OTC Bulletin Board and if prices for the
Common Stock are then reported on the OTCQX, OTCQB or OTC Pink
Marketplace maintained by the OTC Markets Group, Inc. (or a similar
organization or agency succeeding to its functions of reporting
prices), the volume weighted average price of the Common Stock on
the first such facility (or a similar organization or agency
succeeding to its functions of reporting prices), or (d) in
all other cases, the fair market value of a share of Common Stock
as determined by an independent appraiser selected in good faith by
the Purchasers of a majority in interest of the Securities then
outstanding and reasonably acceptable to the Company, the fees and
expenses of which shall be paid by the Company.
ARTICLE II.
PURCHASE AND SALE
2.1
Closing
.
On one or more Closing Dates, upon the terms and subject to the
conditions set forth herein, substantially concurrent with the
execution and delivery of this Agreement by the parties hereto, the
Company agrees to sell, and each of the Purchasers, severally and
not jointly, agrees to purchase the Shares for an aggregate
purchase price up to a maximum of $1,000,000
(“
Purchase
Price
”), each consisting
of one share of Common Stock (or, at the election of any Purchaser
who, as a result of the ownership of the Common Stock would hold in
excess of 4.99% of the Company’s issued and outstanding
Common Stock, the equivalent amount of Preferred Shares) (each such
purchase and sale being the “
Closing
”),
at the Per Share Purchase Price. Prior to the Closing, each
Purchaser shall deliver to the Company,
inter
alia
,
such Purchaser’s Subscription Amount as set forth on the
signature page hereto executed by such Purchaser by a wire transfer
of immediately available funds, and the Company shall, on the
Closing Date, cause the Company to deliver to each
Purchaser,
inter
alia
,
a certificate representing the number of Shares purchased by each
such Purchaser at the Closing as determined pursuant to Section
2.2(a). The Company and each Purchaser shall also deliver the other
items set forth in Section 2.2 deliverable at the Closing. Upon
satisfaction of the covenants and conditions set forth in Sections
2.2 and 2.3, the Closings shall occur at the offices of Company
Counsel or such other location as the parties shall mutually
agree.
Notwithstanding anything herein to the contrary, each
Closing Date shall occur on or before May 25, 2018 (such outside
date, “
Termination
Date
”). If any Closing is not held on or before the
Termination Date, (i) all subscription documents executed by the
Company or a Purchaser shall be returned to the Company or such
Purchaser, as applicable, and (ii) each Subscription Amount shall
be returned, without interest or deduction to the Purchaser who
delivered such Subscription Amount. If a Closing is not held on or
before the Termination Date, the Company shall cause all
subscription documents and funds to be returned, without interest
or deduction to each prospective Purchaser.
2.2
Deliveries
.
(a) On
the Closing Date, the Company shall deliver or cause to be
delivered to the Purchasers the following:
(i)
this Agreement and the Registration Rights Agreement each duly
executed by the Company, to the Purchasers;
(ii)
certificates evidencing a number of applicable Shares equal to such
Purchaser’s Subscription Amount divided by the Share Purchase
Price registered in the name of such Purchaser; and
(iii)
file stamped evidence from the Secretary of State of the State of
Delaware of the Certificate of Designation.
(b) On
or prior to the applicable Closing Date, each Purchaser shall
deliver or cause to be delivered to the Company the
following:
(i)
such
Purchaser’s Subscription Amount by wire transfer to the
account previously specified by the Company; and
(ii)
this
Agreement and the Registration Rights Agreement each duly executed
by the Purchaser
2.3
Closing
Conditions
.
(a) The
obligations of the Company hereunder in connection with the
Closing, unless waived by a Majority in Interest, are subject to
the following conditions being met:
(i) the
accuracy in all material respects when made and on the Closing Date
of the representations and warranties of the Purchasers contained
herein (unless as of a specific date therein in which case they
shall be accurate as of such date);
(ii) all
conditions, obligations, covenants and agreements of each Purchaser
under this Agreement required to be performed at or prior to the
Closing Date shall have been performed in all material respects;
and
(iii) the
delivery by each Purchaser of the items set forth in Section 2.2(b)
of this Agreement.
(b)
The
respective independent obligations of a Purchaser hereunder in
connection with the Closing, unless waived by such Purchaser, are
subject to the following conditions being met:
(i) the
accuracy in all material respects (when made and on the Closing
Date of the representations and warranties of the Company contained
herein (unless as of a specific date therein in which case they
shall be accurate as of such date);
(ii) all
Required Approvals, obligations, covenants and agreements of the
Company under this Agreement required to be performed at or prior
to the Closing Date shall have been performed;
(iii) the
delivery by the Company of the items set forth in Section 2.2(a) of
this Agreement; and
(iv) there
shall have been no Material Adverse Effect with respect to the
Company since the date hereof and the Closing Date.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1
Representations
and Warranties of the Company
.
Except as set forth in the SEC Reports, which shall be deemed a
part hereof, the Company hereby makes the following representations
and warranties to each Purchaser as of the date of this Agreement
and as of the Closing Date:
(a)
Subsidiaries
.
All of the direct and indirect subsidiaries of the Company are set
forth in the SEC Reports. The Company owns, directly or indirectly,
a majority of the capital stock or other equity interests of each
Subsidiary free and clear of any Liens, subject to restrictions
under applicable laws, and all of the issued and outstanding shares
of capital stock of each Subsidiary are validly issued and are
fully paid, non-assessable and free of preemptive and similar
rights to subscribe for or purchase securities.
(b)
Organization
and Qualification
. The
Company and each of the Subsidiaries is an entity duly incorporated
or otherwise organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization,
with the requisite power and authority to own and use its
properties and assets and to carry on its business as currently
conducted. Neither the Company nor any Subsidiary is in
violation or default of any of the provisions of its respective
certificate or articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and
the Subsidiaries is duly qualified to conduct business and is in
good standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the
case may be, could not reasonably be expected to result in: (i) a
material adverse effect on the legality, validity or enforceability
of any Transaction Document, (ii) a material adverse effect on the
results of operations, assets, business, prospects or condition
(financial or otherwise) of the Company and the Subsidiaries, taken
as a whole, or (iii) a material adverse effect on the
Company’s ability to perform in any material respect on a
timely basis its obligations under any Transaction Document (any of
(i), (ii) or (iii), a “
Material Adverse
Effect
”) and to the best
of the Company’s knowledge no Proceeding has been instituted
in any such jurisdiction revoking, limiting or curtailing or
seeking to revoke, limit or curtail such power and authority or
qualification.
(c)
Authorization;
Enforcement
. The Company
has the requisite corporate power and authority to enter into and
to consummate the transactions contemplated by this Agreement and
each of the other Transaction Documents and otherwise to carry out
its obligations hereunder and thereunder. The execution and
delivery of each of this Agreement and the other Transaction
Documents by the Company and the consummation by it of the
transactions contemplated hereby and thereby have been duly
authorized by all necessary action on the part of the Company and
no further action is required by the Company, the Board of
Directors or the Company’s stockholders in connection
herewith or therewith other than in connection with the Required
Approvals. This Agreement and each other Transaction Document
to which it is a party has been (or upon delivery will have been)
duly executed by the Company and, when delivered in accordance with
the terms hereof and thereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in
accordance with its terms, except: (i) as limited by general
equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation and other laws of general
application affecting enforcement of creditors’ rights
generally, and (ii) as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable
remedies.
(d)
No
Conflicts
. The execution,
delivery and performance by the Company of this Agreement and the
other Transaction Documents to which it is a party, the issuance
and sale of the Securities and the consummation by it of the
transactions contemplated hereby and thereby do not and will not:
(i) conflict with or violate any provision of the Company’s
or any Subsidiary’s certificate or articles of incorporation,
bylaws or other organizational or charter documents, (ii) conflict
with, or constitute a default (or an event that with notice or
lapse of time or both would become a default) by the Company or any
Subsidiary under, result in the creation of any Lien upon any of
the properties or assets of the Company or any Subsidiary, or give
to others any rights of termination, amendment, acceleration or
cancellation (with or without notice, lapse of time or both) of,
any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or
by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals,
conflict with or result in a violation of any law, rule,
regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the
Company or a Subsidiary is subject (including Securities Laws), or
by which any property or asset of the Company or a Subsidiary is
bound or affected; except in the case of each of clauses (ii) and
(iii), such as reasonably be expected to result in a Material
Adverse Effect.
(e)
Filings,
Consents and Approvals
.
T
he
Company is not required to obtain any consent, waiver,
authorization or order of, give any notice to, or make any filing
or registration with, any court or other provincial or foreign or
domestic federal, state, local or other governmental authority or
other Person in connection with the execution, delivery and
performance by the Company of the Transaction Documents, other
than: (i) the filings required pursuant to Section 4.5 of this
Agreement, (ii) the filing with the Commission pursuant to the
Registration Rights Agreement, (iii)
the notice and/or
application(s) to each applicable Trading Market for the issuance
and sale of the Securities and the listing of the Shares and
Underlying Shares (as defined below) for trading thereon in the
time and manner required thereby, all of which shall have been
effectuated prior to the Closing, (iv) the filing of the
Certificate of Designation with the Secretary of State of the State
of Delaware, (v)
the filing of a Form
D with the Commission and (vi) the consent of the lead investor in
the May 17, 2017 public offering (collectively, the
“
Required
Approvals
”).
(f)
Issuance
of the Securities
. The
Securities are restricted securities and have been duly authorized
and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid
and nonassessable, free and clear of all Liens other than
restrictions on transfer provided for under the Securities Act, the
Exchange Act, in the Transaction Documents and as provided
herein.
(g)
Form
8-K; Financial Statements
.
T
he Company has filed all reports, schedules, forms,
statements and other documents required to be filed by the Company
under the Securities Act and the Exchange Act, including pursuant
to Sections 12(b), 12(g), 13(a) or 15(d) thereof, for the six (6)
months preceding the date hereof.
The
Form 8-K described in Section 4.3, upon its filing, will comply in
all material respects with the requirements of the Exchange Act,
and will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The
latest audited financial statements of the Company included in the
SEC Reports, if any, comply in all material respects with
applicable accounting requirements and the rules and regulations of
the Commission with respect thereto as in effect at the time of
filing. Such financial statements have been prepared in
accordance with United States generally accepted accounting
principles applied on a consistent basis during the periods
involved (“
GAAP
”),
except as may be otherwise specified in such financial statements
or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP and are subject to
normal, immaterial, year-end audit adjustments, and fairly present
in all material respects the financial position of the Company and
its consolidated Subsidiaries as of and for the dates thereof and
the results of operations and cash flows for the periods then
ended, subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.
(h)
Certain
Fees
. There are no brokerage or
finder’s fees or commissions that are or will be payable by
the Company or any Subsidiary to any broker, financial advisor or
consultant, finder, placement agent, investment banker, bank or
other Person with respect to the transactions contemplated by the
Transaction Documents. The Purchasers shall have no obligation with
respect to any fees or with respect to any claims made by or on
behalf of other Persons for fees of a type contemplated in this
Section that may be due in connection with the transactions
contemplated by the Transaction Documents
3.2
Representations
and Warranties of the Purchasers
. Each Purchaser, for itself and for no
other Purchaser, hereby represents and warrants as of the date
hereof and as of the Closing Date to the Company as follows (unless
as of a specific date therein):
(a)
Organization;
Authority
.
Such
Purchaser is either an individual or an entity duly incorporated or
formed, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation with full right,
corporate, partnership, limited liability company or similar power
and authority to enter into and to consummate the transactions
contemplated by the Transaction Documents and otherwise to carry
out its obligations hereunder and thereunder. The execution and
delivery of the Transaction Documents and performance by such
Purchaser of the transactions contemplated by the Transaction
Documents have been duly authorized by all necessary corporate,
partnership, limited liability company or similar action, as
applicable, on the part of such Purchaser. Each Transaction
Document to which it is a party has been duly executed by such
Purchaser, and when delivered by such Purchaser in accordance with
the terms hereof, will constitute the valid and legally binding
obligation of such Purchaser, enforceable against it in accordance
with its terms, except: (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited
by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) insofar as
indemnification and contribution provisions may be limited by
applicable law. If such Purchaser is an entity, the address of its
principal place of business is as set forth on the signature page
hereto, and if such Purchaser is an individual, the address of its
principal residence is as set forth on the signature page
hereto.
(b)
Understandings
or Arrangements
. Such Purchaser understands that the
Securities are “restricted securities” and have not
been registered under the Securities Act or any applicable state
securities law and is acquiring the Securities as principal for its
own account and not with a view to or for distributing or reselling
such Securities or any part thereof in violation of the Securities
Act or any applicable state securities law, has no present
intention of distributing any of such Securities in violation of
the Securities Act or any applicable state securities law and has
no direct or indirect arrangement or understandings with any other
persons to distribute or regarding the distribution of such
Securities in violation of the Securities Act or any applicable
state securities law (this representation and warranty not limiting
such Purchaser’s right to sell the Securities pursuant to a
registration statement or otherwise in compliance with applicable
federal and state securities laws). Such Purchaser is acquiring the
Securities hereunder in the ordinary course of its
business.
(c)
Purchaser
Status
.
At the
time such Purchaser was offered the Securities, it was, and as of
the date hereof it is either: (i) an “accredited
investor” as defined in Rule 501(a)(1), (a)(2), (a)(3),
(a)(7) or (a)(8) under the Securities Act or (ii) a
“qualified institutional buyer” as defined in Rule
144A(a) under the Securities Act. Such Purchaser is not required to
be registered as a broker-dealer under Section 15 of the Exchange
Act. Such Purchaser has the authority and is duly and legally
qualified to purchase and own the Securities. Such Purchaser is
able to bear the risk of such investment for an indefinite period
and to afford a complete loss thereof. Such Purchaser has provided
the information in the Accredited Investor Questionnaire attached
hereto as
Exhibit D
(the “
Investor
Questionnaire
”). The information set forth on the
signature pages hereto and the Investor Questionnaire regarding
such Purchaser is true and complete in all respects. Except as
disclosed in the Investor Questionnaire, such Purchaser has had no
position, office or other material relationship within the past
three years with the Company or Persons (as defined below) known to
such Purchaser to be affiliates of the Company, and is not a member
of the Financial Industry Regulatory Authority or an
“associated person” (as such term is defined under the
FINRA Membership and Registration Rules Section 1011).
(d)
Experience
of Such Purchaser
.
Such Purchaser, either alone or together with its representatives,
has such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities, and has so
evaluated the merits and risks of such investment. Such Purchaser
is able to bear the economic risk of an investment in the
Securities and, at the present time, is able to afford a complete
loss of such investment.
(e)
Information
on Company
. Such Purchaser has been furnished with or has
had access to the EDGAR Website of the Commission to the
Company’s filings made with the Commission during the period
from the date that is two (2) years preceding the date hereof
through the tenth business day preceding the Closing Date in which
such Purchaser purchases Securities hereunder, including but not
limited to the Risk Factor section of the Company’s filings
and reports made with the Commission. In addition,
such Purchaser may have received in writing from the Company such
other information concerning its operations, financial condition
and other matters as such Purchaser has requested, identified
thereon as OTHER WRITTEN INFORMATION (such other information is
collectively, the “
Other Written
Information
”), and considered all factors such
Purchaser deems material in deciding on the advisability of
investing in the Securities. Such Purchaser was afforded
(i) the opportunity to ask such questions as such Purchaser deemed
necessary of, and to receive answers from, representatives of the
Company concerning the merits and risks of acquiring the
Securities; (ii) the right of access to information about the
Company and its financial condition, results of operations,
business, properties, management and prospects sufficient to enable
such Purchaser to evaluate the Securities; and (iii) the
opportunity to obtain such additional information that the Company
possesses or can acquire without unreasonable effort or expense
that is necessary to make an informed investment decision with
respect to acquiring the Securities.
(f)
Certain
Transactions and Confidentiality
.
Such Purchaser understands and
agrees that the Securities have not been registered under the
Securities Act or any applicable state securities laws, by reason
of their issuance in a transaction that does not require
registration under the Securities Act, and that such Securities
must be held indefinitely unless a subsequent disposition is
registered under the Securities Act or any applicable state
securities laws or is exempt from such registration. Such Purchaser
understands and agrees that the Securities are being offered and
sold to such Purchaser in reliance on specific exemptions from the
registration requirements of United States federal and state
securities laws and regulations and that the Company is relying in
part upon the truth and accuracy of, and such Purchaser’s
compliance with, the representations, warranties, agreements,
acknowledgments and understandings of such Purchaser set forth
herein in order to determine the availability of such exemptions
and the eligibility of such Purchaser to acquire the
Securities.
(g)
Communication
of Offer
. Such Purchaser is not purchasing the Securities as
a result of any “general solicitation” or
“general advertising,” as such terms are defined in
Regulation D, which includes, but is not limited to, any
advertisement, article, notice or other communication regarding the
Securities published in any newspaper, magazine or similar media or
on the internet or broadcast over television, radio or the internet
or presented at any seminar or any other general solicitation or
general advertisement.
(h)
No Governmental
Review
. Such Purchaser understands that no United States
federal or state agency or any other governmental or state agency
has passed on or made recommendations or endorsement of the
Securities or the suitability of the investment in the Securities
nor have such authorities passed upon or endorsed the merits of the
offering of the Securities.
(i)
No Conflicts
. The
execution, delivery and performance of this Agreement and
performance under the other Transaction Documents and the
consummation by such Purchaser of the transactions contemplated
hereby and thereby or relating hereto or thereto do not and will
not (i) result in a violation of such Purchaser’s charter
documents, bylaws or other organizational documents, if applicable,
(ii) conflict with nor constitute a default (or an event which with
notice or lapse of time or both would become a default) under any
agreement to which such Purchaser is a party, nor (iii) result in a
violation of any law, rule, or regulation, or any order, judgment
or decree of any court or governmental agency applicable to such
Purchaser or its properties (except for such conflicts, defaults
and violations as would not, individually or in the aggregate, have
a material adverse effect on such Purchaser). Such Purchaser is not
required to obtain any consent, authorization or order of, or make
any filing or registration with, any court or governmental agency
in order for it to execute, deliver or perform any of its
obligations under this Agreement or perform under the other
Transaction Documents nor to purchase the Securities in accordance
with the terms hereof, provided that for purposes of the
representation made in this sentence, such Purchaser is assuming
and relying upon the accuracy of the relevant representations and
agreements of the Company herein.
(j)
Certain Transactions and
Confidentiality
. Other than consummating the transactions
contemplated hereunder, such Purchaser has not directly or
indirectly, nor has any Person acting on behalf of or pursuant to
any understanding with such Purchaser, executed any purchases or
sales, including Short Sales, of the securities of the Company
during the period commencing as of the time that such Purchaser
first received a written term sheet of the Offering from the
Company setting forth the material terms of the transactions
contemplated hereunder and ending immediately prior to the
execution hereof. Notwithstanding the foregoing, in the case of a
Purchaser that is a multi-managed investment vehicle whereby
separate portfolio managers manage separate portions of such
Purchaser’s assets and the portfolio managers have no direct
knowledge of the investment decisions made by the portfolio
managers managing other portions of such Purchaser’s assets,
the representation set forth above shall only apply with respect to
the portion of assets managed by the portfolio manager that made
the investment decision to purchase the Securities covered by this
Agreement. Other than to other Persons party to this Agreement,
such Purchaser has maintained the confidentiality of all
disclosures made to it in connection with this transaction
(including the existence and terms of this transaction).
Notwithstanding the foregoing, for avoidance of doubt, nothing
contained herein shall constitute a representation or warranty, or
preclude any actions, with respect to the identification of the
availability of, or securing of, available shares to borrow in
order to effect Short Sales or similar transactions after the
Closing Date.
(k)
Pre-Existing
Relationships
.
The
Purchaser represents and warrants that: (i) the Purchaser has a
prior substantial pre-existing relationship with the Company, the
Purchaser is not investing in the Offering in connection with or as
a result of any registration statement filed with the SEC by the
Company and (ii) no Securities were offered or sold to it by
means of any form of general solicitation or general advertising,
and in connection therewith, the Purchaser did not (A) receive or
review any advertisement, article, notice or other communication
published in a newspaper or magazine or similar media or broadcast
over television or radio, whether closed circuit, or generally
available; or (B) attend any seminar meeting or industry investor
conference whose attendees were invited by any general solicitation
or general advertising; or (C) observe any website or filing of the
Company with the Commission in which any offering of securities by
the Company was described and as a result learned of any offering
of securities by the Company.
(l)
Non-U.S. Person
. To
the extent the Purchaser is not a U.S. Person (a “Reg S
Person”), such Purchaser hereby represents that the
representations contained in paragraphs (1) through (6) of this
Section 3.2(l) are true and correct with respect to such
Purchaser.
(1) (i)
the issuance and sale to such Reg S Person of the Securities is
intended to be exempt from the registration requirements of the
Securities Act, pursuant to the provisions of Regulation S; (ii) it
is not a “U.S. Person,” as such term is defined in
Regulation S, and is not acquiring the Securities for the account
or benefit of any U.S. Person; and (iii) the offer and sale of the
Securities has not taken place, and is not taking place, within the
United States of America or its territories or possessions. Such
Reg S Person acknowledges that the offer and sale of the Securities
has taken place, and is taking place in an “offshore
transaction,” as such term is defined in Regulation
S.
(2)
Such
Reg S Person acknowledges and agrees that, pursuant to the
provisions of Regulation S, the
Securities
cannot be sold, assigned, transferred, conveyed,
pledged or otherwise disposed of to any U.S. Person or within the
United States of America or its territories or possessions for a
period of one year from and after the Closing Date, unless
such
Securities
are registered
for sale in the United States pursuant to an effective registration
statement under the Securities Act or another exemption from such
registration is available. Such Reg S Person acknowledges that it
has not engaged in any hedging transactions with regard to
the
Securities
.
(3)
Such
Reg S Person consents to the placement of a legend on any
certificate, note or other document evidencing the Securities and
understands that the Company shall be required to refuse to
register any transfer of securities not made in accordance with
applicable U.S. securities laws.
(4)
Such
Reg S Person is not a “distributor” of securities, as
that term is defined in Regulation S, nor a dealer in
securities.
(5)
Such
Reg S Person understands that the
Securities
have not been registered under the Securities Act,
or the securities laws of any state and are subject to substantial
restrictions on resale or transfer. The
Securities
are “restricted
securities” within the meaning of Regulation S and Rule 144,
promulgated under the Securities Act.
(6)
Such
Reg S Person makes the representations, declarations and warranties
as contained in this Section 3.2(l) with the intent that the same
shall be relied upon by the Company in determining its suitability
as a purchaser of such Securities.
(m)
Survival
. The
foregoing representations and warranties shall survive the Closing
Date.
The
Company acknowledges and agrees that the representations contained
in Section 3.2 shall not modify, amend or affect such
Purchaser’s right to rely on the Company’s
representations and warranties contained in this Agreement or any
representations and warranties contained in any other Transaction
Document or any other document or instrument executed and/or
delivered in connection with this Agreement or the consummation of
the transaction contemplated hereby.
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1
Transfer
Restrictions
.
(a)
Securities
Laws
. The Securities may only
be disposed of in compliance with state and federal securities
laws. In connection with any transfer of Securities other
than pursuant to an effective registration statement or Rule 144,
to the Company or to an Affiliate of a Purchaser or in connection
with a pledge as contemplated in Section 4.1(c), the Company may
require the transferor thereof to provide to the Company an opinion
of counsel selected by the transferor and reasonably acceptable to
the Company, the form and substance of which opinion shall be
reasonably satisfactory to the Company, to the effect that such
transfer does not require registration of such transferred
Securities under the Securities Act. As a condition of such
transfer, any such transferee shall agree in writing to be bound by
the terms of this Agreement, and the Registration Rights Agreement,
and shall have the rights and obligations of a Purchaser under this
Agreement and the other Transaction Documents.
(b)
Legend
.
The Purchasers
agree
to the
imprinting, so long as is required by this Section 4.1, of a legend
on any of the Securities in the following form:
For
U.S. Persons:
[NEITHER]
THIS SECURITY [NOR THE SECURITIES [FOR] WHICH THIS SECURITY IS
EXERCISABLE] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND
APPLICABLE STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE
OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. TO
THE EXTENT PERMITTED BY APPLICABLE SECURITIES LAWS, THIS SECURITY
[AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY] MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A
REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION
THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE
501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH
SECURITIES.
For
Non-U.S. Persons:
THESE
SECURITIES [AND THE SECURITIES FOR WHICH THIS SECURITY IS
EXERCISABLE] WERE ISSUED IN AN OFFSHORE TRANSACTION TO PERSONS WHO
ARE NOT U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”)
PURSUANT TO REGULATION S UNDER THE 1933 ACT. ACCORDINGLY, NONE OF
THE SECURITIES TO WHICH THIS CERTIFICATE RELATES HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS,
AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD IN THE
UNITED STATES OR, DIRECTLY OR INDIRECTLY, TO U.S. PERSONS (AS
DEFINED IN REGULATION S PROMULGATED UNDER THE SECURITIES ACT)
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR PURSUANT
TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED
UNLESS IN ACCORDANCE WITH THE 1933 ACT.
(c)
Pledge
.
The Company acknowledges and agrees that a Purchaser may from time
to time pledge pursuant to a bona fide margin agreement with a
registered broker-dealer or grant a security interest in some or
all of the Securities to a financial institution that is an
“accredited investor” as defined in Rule 501(a) under
the Securities Act and who agrees to be bound by the provisions of
this Agreement and the Registration Rights Agreement and, if
required under the terms of such arrangement, such Purchaser may
transfer pledge or secure Securities to the pledgees or secured
parties. Such a pledge or transfer would not be subject to approval
of the Company and no legal opinion of legal counsel of the
pledgee, secured party or pledgor shall be required in connection
therewith. Further, no notice shall be required of such pledge. At
such Purchaser’s expense, the Company will execute and
deliver such reasonable documentation as a pledgee or secured party
of Securities may reasonably request in connection with a pledge or
transfer of the Securities including, if the Securities are subject
to registration pursuant to the Registration Rights Agreement, the
preparation and filing of any required prospectus supplement under
Rule 424(b)(3) under the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of
selling stockholders thereunder.
(d)
Company
will accept an opinion of counsel to Purchaser (reasonably
acceptable to Company and Transfer Agent) and upon acceptance by
Transfer Agent, certificates evidencing the Conversion Shares (the
“Underlying Shares”) shall not contain any legend
(including the legend set forth in Section 4.1(b) hereof): (i)
while a registration statement (including the Registration
Statement) covering the resale of such security is effective under
the Securities Act, (ii) following any sale of such Underlying
Shares pursuant to Rule 144, (iii) if such Underlying Shares are
eligible for sale under Rule 144, or (iv) if such legend is not
required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by
the staff of the Commission), unless counsel to the Company shall
have rendered such opinion. The Company shall cause its counsel to
issue a legal opinion to the Transfer Agent or the Purchaser
promptly after the Effective Date if required by the Transfer Agent
to effect the removal of the legend hereunder.
4.2
Conversion
Procedures
. The form of
Conversion Notice included in the Certificate of Designation, sets
forth the totality of the procedures required of the Purchasers in
order to convert the Preferred Shares. Without limiting the
preceding sentences, no ink-original Conversion Notice shall be
required, nor shall any medallion guarantee (or other type of
guarantee or notarization) of any Conversion Notice form be
required in order to convert the Preferred Shares. No additional
legal opinion, other information or instructions shall be required
of the Purchasers to convert their Preferred Shares. The Company
shall honor conversion of the Preferred Shares and shall deliver
the underlying shares of Common Stock in accordance with the terms,
conditions and time periods set forth in the Transaction
Documents.
4.3
Securities
Laws Disclosure; Publicity
.
The Company shall, by 9:00 a.m.
(New York City time) on the third (3d) Trading Day immediately
following the Closing Date, issue a press release disclosing the
material terms of the transactions contemplated hereby, and shall
file a Current Report on Form 8-K including the Transaction
Documents as exhibits thereto within the time period required by
the Exchange Act. From and after the issuance of such press release
and Form 8-K, the Company represents to the Purchasers that it
shall have publicly disclosed all material, non-public information
delivered to any of the Purchasers by the Company or any of its
Subsidiaries, or any of their respective officers, directors,
employees or agents in connection with the transactions
contemplated by the Transaction Documents existing as of the
Closing Date. Notwithstanding the foregoing, the Company shall not
publicly disclose the name of any Purchaser, or include the name of
any Purchaser in any filing with the Commission or any regulatory
agency or Trading Market unless the name of such Purchaser is
already included in the body of the Transaction Documents, without
the prior written consent of such Purchaser, except: (a) as
required by federal securities law in connection with the filing of
final Transaction Documents with the Commission, (b) pursuant to
the Registration Rights Agreement and (c) to the extent such
disclosure is required by law or Trading Market
regulations).
4.4
Use
of Proceeds
. The Company
will use the net proceeds to the Company from the sale of the
Shares hereunder for general corporate purposes and working
capital.
4.5
Form D;
Blue Sky Filings
. The
Company agrees to timely file a Form D with respect to the sale of
the Securities by the Company under this Agreement as required
under Regulation D. The Company shall take such action as the
Company shall reasonably determine is necessary in order to obtain
an exemption for, or to qualify the Securities for, sale to the
Purchasers at the Closing under applicable securities or
“Blue Sky” laws of the states of the United States, and
shall provide evidence of such actions promptly upon request of any
Purchaser.
4.6
Certain
Transactions and Confidentiality
. Each Purchaser, severally and not jointly with
the other Purchasers, covenants that neither it, nor any Affiliate
acting on its behalf or pursuant to any understanding with it will
execute any purchases or sales, including Short Sales, of any of
the Company’s securities during the period commencing with
the execution of this Agreement and ending at such time that the
transactions contemplated by this Agreement are first publicly
disclosed or required to be disclosed, whichever occurs first, in
the Form 8-K described in Section 4.3. Each Purchaser,
severally and not jointly with the other Purchasers, covenants that
until such time as the transactions contemplated by this Agreement
are publicly disclosed or required to be publicly disclosed,
whichever occurs first, by the Company in such Form 8-K, such
Purchaser will maintain the confidentiality of the existence and
terms of this transaction and the information included in the
Transaction Documents. Notwithstanding the foregoing, and
notwithstanding anything contained in this Agreement to the
contrary, the Company expressly acknowledges and agrees that (i) no
Purchaser makes any representation, warranty or covenant hereby
that it will not engage in effecting transactions in any securities
of the Company after the time that the transactions contemplated by
this Agreement are required to be disclosed in the Form 8-K
described in Section 4.3, (ii) no Purchaser shall be restricted or
prohibited from effecting any transactions in any securities of the
Company in accordance with applicable Securities Laws from and
after the time that the transactions contemplated by this Agreement
are first disclosed or required to be disclosed, whichever occurs
first, in the Form 8-K described in Section 4.5, and (iii) no
Purchaser shall have any duty of confidentiality to the Company or
its Subsidiaries after the filing of such Form 8-K or after the
date such Form 8-K is required to have been filed, whichever occurs
first. Notwithstanding the foregoing, in the case of a
Purchaser that is a multi-managed investment vehicle whereby
separate portfolio managers manage separate portions of such
Purchaser’s assets and the portfolio managers have no direct
knowledge of the investment decisions made by the portfolio
managers managing other portions of such Purchaser’s assets,
the covenant set forth above shall only apply with respect to the
portion of assets managed by the portfolio manager that made the
investment decision to purchase the Securities covered by this
Agreement.
ARTICLE V.
MISCELLANEOUS
5.1
Termination
.
This Agreement may be terminated by any Purchaser, as to such
Purchaser’s obligations hereunder only and without any effect
whatsoever on the obligations between the Company and the other
Purchasers, by written notice given at any time to the Company,
prior to the occurrence of a Closing with respect to such
Purchaser’s Subscription Agreement. In the event of any
termination by a Purchaser under this Section 5.1, the Company
shall promptly (and in any event within two (2) Business Days of
such termination) refund such Purchaser’s entire subscription
amount.
5.2
Fees
and Expenses
. Except as
expressly set forth in the Transaction Documents, each party shall
pay the fees and expenses of its advisers, counsel, accountants and
other experts, if any, and all other expenses incurred by such
party incident to the negotiation, preparation, execution, delivery
and performance of this Agreement. The Company shall pay all
Transfer Agent fees, stamp taxes and other similar taxes and duties
levied in connection with the delivery of any Securities to the
Purchasers.
5.3
Entire
Agreement
. The
Transaction Documents, together with the exhibits and schedules
thereto, contain the entire understanding of the parties with
respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings, oral or written, with respect
to such matters, which the parties acknowledge have been merged
into such documents, exhibits and schedules.
5.4
Notices
.
All notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally
served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable
air courier service with charges prepaid, or (iv) transmitted by
hand delivery, telegram, or facsimile, addressed as set forth below
or to such other address as such party shall have specified most
recently by written notice. Any notice or other communication
required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by facsimile, with
accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on
a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if
delivered other than on a business day during normal business hours
where such notice is to be received) or (b) on the second business
day following the date of mailing by express courier service,
prepaid, addressed to such address, or upon actual receipt of such
mailing, whichever shall first occur. The addresses for such
communications shall be: (i) if to the Company, to: MabVax
Therapeutics Holdings, Inc., 11535 Sorrento Valley Road, Suite 400,
San Diego, CA 92121, Attn: Chief Financial Officer
, with a
copy by fax only to (which shall not constitute notice): Company
Counsel, and (ii) if to the Purchasers, to: the addresses and fax
numbers indicated on the signature pages hereto.
5.5
Amendments;
Waivers
.
No
provision of this Agreement may be waived, modified, supplemented
or amended except in a written instrument signed, in the case of an
amendment, by the Company and the Purchasers holding at least a
majority of the component of the affected Securities purchased
hereunder and which are materially adversely affected by such
waiver, modification, supplement or amendment then outstanding
(such majority being the “Majority in Interest”) or, in
the case of a waiver, by the party against whom enforcement of any
such waived provision is sought. No waiver of any default with
respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right.
As employed herein, “consent” shall
mean consent of the Majority in Interest on the date such consent
is requested or required.
5.6
Headings
.
The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.
5.7
Successors
and Assigns
. This
Agreement shall be binding upon and inure to the benefit of the
parties and their successors and permitted assigns. The
Company may not assign this Agreement or any rights or obligations
hereunder without the prior written consent of each Purchaser
(other than by merger). Any Purchaser may assign any or all
of its rights under this Agreement to any Person to whom such
Purchaser assigns or transfers any Securities, provided that such
transferee agrees in writing to be bound, with respect to the
transferred Securities, by the provisions of the Transaction
Documents that apply to the
“Purchasers.”
5.8
No
Third-Party Beneficiaries
. This Agreement is intended for the benefit
of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof
be enforced by, any other Person, except as otherwise provided for
herein.
5.9
Governing
Law
. All questions
concerning the construction, validity, enforcement and
interpretation of the Transaction Documents shall be governed by
and construed and enforced in accordance with the internal laws of
the State of New York, without regard to the principles of
conflicts of law thereof. Each party agrees that all legal
proceedings concerning the interpretations, enforcement and defense
of the transactions contemplated by this Agreement and any other
Transaction Documents (whether brought against a party hereto or
its respective affiliates, directors, officers, shareholders,
partners, members, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of
New York. Each party hereto and each individual signing any
Transaction Document on behalf of the Company hereby irrevocably
submits to the exclusive jurisdiction of the state and federal
courts sitting in the City of New York, Borough of Manhattan for
the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of any of the
Transaction Documents), and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it,
he or she is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is improper or is an
inconvenient venue for such proceeding. Each party hereby
irrevocably waives personal service of process and consents to
process being served in any such suit, action or proceeding by
mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of
process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any other
manner permitted by law. If either party shall commence an
action or proceeding to enforce any provisions of the Transaction
Documents, then, the prevailing party in such action, suit or
proceeding shall be reimbursed by the other party for its
reasonable attorneys’ fees and other costs and expenses
incurred with the investigation, preparation and prosecution of
such action or proceeding.
5.10
Survival
.
The representations and warranties contained herein shall survive
the Closing and the delivery of the Securities at the Closings for
the applicable statute of limitations.
5.11
Execution
.
This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same
agreement and shall become effective when counterparts have been
signed by each party and delivered to each other party, it being
understood that the parties need not sign the same
counterpart. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a
“.pdf” format data file, such signature shall create a
valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect
as if such facsimile or “.pdf” signature page were an
original thereof.
5.12
Severability
.
If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their
commercially reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It
is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or
unenforceable.
5.13
Rescission
and Withdrawal Right
.
Notwithstanding anything to the contrary contained in (and without
limiting any similar provisions of) any of the other Transaction
Documents, whenever any Purchaser exercises a right, election,
demand or option under a Transaction Document and the Company does
not timely perform its related obligations within the periods
therein provided, then such Purchaser may rescind or withdraw, in
its sole discretion from time to time upon written notice to the
Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and
rights.
5.14
Replacement
of Securities
. If any
certificate or instrument evidencing any Securities is mutilated,
lost, stolen or destroyed, the Company shall issue or cause to be
issued in exchange and substitution for and upon surrender and
cancellation thereof (in the case of mutilation), or in lieu of and
substitution therefor, a new certificate or instrument, but only
upon receipt of evidence reasonably satisfactory to the Company of
such loss, theft, destruction
, or mutilation, and of the
ownership of such Security
. The
applicant for a new certificate or instrument under such
circumstances shall also pay any reasonable third-party costs
(including customary indemnity and bonds) associated with the
issuance of such replacement Securities.
5.15
Remedies
.
In addition to being entitled to exercise all rights provided
herein or granted by law, including recovery of damages, each of
the Purchasers and the Company will be entitled to specific
performance under the Transaction Documents. The parties
agree that monetary damages may not be adequate compensation for
any loss incurred by reason of any breach of obligations contained
in the Transaction Documents and hereby agree to waive and not to
assert in any action for specific performance of any such
obligation the defense that a remedy at law would be
adequate.
5.16
Payment
Set Aside
. To the extent
that the Company makes a payment or payments to any Purchaser
pursuant to any Transaction Document or a Purchaser enforces or
exercises its rights thereunder, and such payment or payments or
the proceeds of such enforcement or exercise or any part thereof
are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the
Company, a trustee, receiver or any other Person under any law
(including, without limitation, any bankruptcy law, state or
federal law, common law or equitable cause of action), then to the
extent of any such restoration the obligation or part thereof
originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or
such enforcement or setoff had not occurred.
5.17
Legal
Representation
. Each Purchaser acknowledges that it has been
represented by independent legal counsel in the preparation of the
Agreement. Each Purchaser recognizes and acknowledges that counsel
to the Company has represented other shareholders of the Company,
and may, in the future, represent others in connection with various
legal matters and each Purchaser waives any conflicts of interest
and other allegations that it has not been represented by its own
counsel
.
5.18
Saturdays,
Sundays, Holidays, etc.
If the last or appointed day for the taking of
any action or the expiration of any right required or granted
herein shall not be a Business Day, then such action may be taken
or such right may be exercised on the next succeeding Business
Day.
5.19
Construction
.
The parties agree that each of them and/or their respective counsel
have reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of the
Transaction Documents or any amendments thereto. In addition, each
and every reference to share prices and shares of Common Stock in
any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and
other similar transactions of the Common Stock that occur after the
date of this Agreement.
5.20
Usury
. To the extent it may
lawfully do so, the Company hereby agrees not to insist upon or
plead or in any manner whatsoever claim, and will resist any and
all efforts to be compelled to take the benefit or advantage of,
usury laws wherever enacted, now or at any time hereafter in force,
in connection with any claim, action or proceeding that may be
brought by any Purchaser in order to enforce any right or remedy
under any Transaction Document. Notwithstanding any provision to
the contrary contained in any Transaction Document, it is expressly
agreed and provided that the total liability of the Company under
the Transaction Documents for payments in the nature of interest
shall not exceed the maximum lawful rate authorized under
applicable law (the “
Maximum Rate
”), and,
without limiting the foregoing, in no event shall any rate of
interest or default interest, or both of them, when aggregated with
any other sums in the nature of interest that the Company may be
obligated to pay under the Transaction Documents exceed such
Maximum Rate. It is agreed that if the maximum contract rate of
interest allowed by law and applicable to the Transaction Documents
is increased or decreased by statute or any official governmental
action subsequent to the date hereof, the new maximum contract rate
of interest allowed by law will be the Maximum Rate applicable to
the Transaction Documents from the Closing Date thereof forward,
unless such application is precluded by applicable law. If under
any circumstances whatsoever, interest in excess of the Maximum
Rate is paid by the Company to any Purchaser with respect to
indebtedness evidenced by the Transaction Documents, such excess
shall be applied by such Purchaser to the unpaid principal balance
of any such indebtedness or be refunded to the Company, the manner
of handling such excess to be at such Purchaser’s
election.
5.21
WAIVER
OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY
JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE
PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY
JURY.
5.22
Equitable
Adjustment
. Trading volume
amounts, price/volume amounts and similar figures in the
Transaction Documents shall be equitably adjusted (but without
duplication) to offset the effect of stock splits, similar events
and as otherwise described in this
Agreement.
(Signature Pages Follow)
IN
WITNESS WHEREOF, the parties hereto have caused this Securities
Purchase Agreement to be duly executed by their respective
authorized signatories as of the date first indicated
above.
MABVAX THERAPEUTICS HOLDINGS, INC.
|
|
Address for Notice:
|
|
|
11535 Sorrento Valley Road, Suite 400
San Diego, CA 92121
|
By:
|
/s/
J. David Hansen
|
|
|
Name:
|
J. David Hansen
|
|
|
Title:
|
President and CEO
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
[PURCHASER
SIGNATURE PAGES TO MABVAX THERAPEUTICS HOLDINGS, INC.
SECURITIES
PURCHASE AGREEMENT]
IN
WITNESS WHEREOF, the undersigned have caused this Securities
Purchase Agreement to be duly executed by their respective
authorized signatories as of the date first indicated
above.
Name of
Purchaser:
________________________________________________________________
Signature
of Authorized Signatory of Purchaser:
__________________________________________
Name of
Authorized Signatory:
_______________________________________________________
Title
of Authorized Signatory:
________________________________________________________
Address
for Delivery of Securities to Purchaser (if not same as address for
notice):
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Subscription
Amount:
US$
□
Shares of Common Stock at $1.10 per Share:
___________________
OR
□
Shares of Series N Preferred Stock at a conversion
price of $1.10 per Share: ___________________
EIN
Number, if applicable, will be provided under separate
cover.
EXHIBITS
Exhibit
A
Form of Certificate of Designation
Exhibit
B
Registration Rights Agreement
Exhibit
C
Form of Investor Questionnaire
EXHIBIT C
ACCREDITED INVESTOR QUESTIONNAIRE
IN CONNECTION WITH INVESTMENT IN SHARES OF MABVAX THERAPEUTICS
HOLDINGS, INC.,
A DELAWARE CORPORATION
PURSUANT TO SECURITIES PURCHASE AGREEMENT DATED APRIL ,
2018
To:
MabVax Therapeutics
Holdings, Inc.
11535
Sorrento Valley Road, Suite 400
San
Diego, CA 92121
Fax:
858-792-7375 ]
INSTRUCTIONS
PLEASE
ANSWER ALL QUESTIONS. If the appropriate answer is
“None” or “Not Applicable”, so state.
Please print or type your answers to all questions. Attach
additional sheets if necessary to complete your answers to any
item.
Your
answers will be kept strictly confidential at all times. However,
MabVax Therapeutics Holdings, Inc. (collectively, the
“Company”) may present this Questionnaire to such
parties as it deems appropriate in order to assure itself that the
offer and sale of securities of the Company will not result in a
violation of the registration provisions of the Securities Act of
1933, as amended, or a violation of the securities laws of any
state.
1.
Please provide the
following information:
Name of additional
purchaser:
(Please
complete information in Question 5)
Date of
birth, or if other than an individual, year of organization or
incorporation:
2.
Residence address,
or if other than an individual, principal office
address:
Taxpayer
Identification
Number:
Business telephone
number:
4. Send mail
to:
Residence
______
Business
_______
5.
With respect to
tenants in common, joint tenants and tenants by the entirety,
complete only if information differs from that above:
Taxpayer
Identification
Number:
Business telephone
number:
Send Mail
to:
Residence
_______
Business
_______
6.
Please describe
your present or most recent business or occupation and indicate
such information as the nature of your employment, how long you
have been employed there, the principal business of your employer,
the principal activities under your management or supervision and
the scope (e.g. dollar volume, industry rank, etc.) of such
activities:
7.
Please state
whether you (i) are associated with or affiliated with a member of
the Financial Industry Regulatory Association, Inc.
(“FINRA”), (ii) are an owner of stock or other
securities of FINRA member (other than stock or other securities
purchased on the open market), or (iii) have made a subordinated
loan to any FINRA member:
If you
answered yes to any of (i) – (iii) above, please indicate the
applicable answer and briefly describe the facts
below:
8A.
Applicable to
Individuals ONLY. Please answer the following questions concerning
your financial condition as an “accredited investor”
(within the meaning of Rule 501 of Regulation D). If the purchaser
is more than one individual, each individual must initial an answer
where the question indicates a “yes” or
“no” response and must answer any other question fully,
indicating to which individual such answer applies. If the
purchaser is purchasing jointly with his or her spouse, one answer
may be indicated for the couple as a whole:
8.1
Does your net
worth* (or joint net worth with your spouse) exceed
$1,000,000?
8.2
Did you have an
individual income** in excess of $200,000 or joint income together
with your spouse in excess of $300,000 in each of the two most
recent years and do you reasonably expect to reach the same income
level in the current year?
8.3
Are you an
executive officer of the Company?
* For
purposes hereof, net worth shall be deemed to include ALL of your
assets, liquid or illiquid MINUS any liabilities.
** For
purposes hereof, the term “income” is not limited to
“adjusted gross income” as that term is defined for
federal income tax purposes, but rather includes certain items of
income which are deducted in computing “adjusted gross
income”. For investors who are salaried employees, the gross
salary of such investor, minus any significant expenses personally
incurred by such investor in connection with earning the salary,
plus any income from any other source including unearned income, is
a fair measure of “income” for purposes hereof. For
investors who are self-employed, “income” is generally
construed to mean total revenues received during the calendar year
minus significant expenses incurred in connection with earning such
revenues.
8.B
Applicable to
Corporations, Partnerships, Trusts, Limited Liability Companies and
other Entities ONLY:
The
purchaser is an accredited investor because the purchaser falls
within at least one of the following categories (Check all
appropriate lines):
___
(i) a bank as
defined in Section 3(a)(2) of the Act or a savings and loan
association or other institution as defined in Section 3(a)(5)(A)
of the Act whether acting in its individual or fiduciary
capacity;
___
(ii) a
broker-dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934, as amended;
___
(iii) an insurance
company as defined in Section 2(13) of the Act;
___
(iv) an investment
company registered under the Investment Company Act of 1940, as
amended (the “Investment Act”) or a business
development company as defined in Section 2(a)(48) of the
Investment Act;
___
(v) a Small
Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958, as amended;
___
(vi) a plan
established and maintained by a state, its political subdivisions,
or any agency or instrumentality of a state or its political
subdivisions, for the benefit of its employees, where such plan has
total assets in excess of $5,000,000;
___
(vii) an employee
benefit plan within the meaning of Title 1 of the Employee
Retirement Income Security Act of 1974, as amended (the
“Employee Act”), where the investment decision is made
by a plan fiduciary, as defined in Section 3(21) of the Employee
Act, which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or an employee
benefit plan that has total assets in excess of $5,000,000, or a
self-directed plan the investment decisions of which are made
solely by persons that are accredited investors;
___
(viii) a private
business development company, as defined in Section 202(a)(22) of
the Investment Advisers Act of 1940, as amended;
___
(ix) an
organization described in Section 501(c)(3) of the Internal Revenue
Code, a corporation, a Massachusetts or similar business trust, or
a partnership, not formed for the specific purpose of acquiring the
securities offered, with total assets in excess of
$5,000,000;
___
(x) a trust, with
total assets in excess of $5,000,000, not formed for the specific
purpose of acquiring the securities offered, whose purchase is
directed by a “sophisticated” person, as described in
Rule 506(b)(2)(ii) promulgated under the Act, who has such
knowledge and experience in financial and business matters that he
or she is capable of evaluating the merits and risks of the
prospective investment;
___
(xi) an entity in
which all of the equity investors are persons or entities described
above (“accredited investors”). ALL EQUITY OWNERS MUST
COMPLETE “EXHIBIT A” ATTACHED HERETO.
9.A
Do you have
sufficient knowledge and experience in financial and business
matters so as to be capable of evaluating the merits and risks
associated with investing in the Company?
ANSWER
QUESTION 9B ONLY IF THE ANSWER TO QUESTION 9A WAS
“NO.”
9.B
If the answer to
Question 9A was “NO,” do you have a financial or
investment adviser (a) that is acting in the capacity as a
purchaser representative and (b) who has sufficient knowledge and
experience in financial and business matters so as to be capable of
evaluating the merits and risks associated with investing in the
Company?
If you
have a financial or investment adviser(s), please identify each
such person and indicate his or her business address and telephone
number in the space below. (Each such person must complete, and you
must review and acknowledge, a separate Purchaser Representative
Questionnaire which will be supplied at your request).
10.
You have the right,
will be afforded an opportunity, and are encouraged to investigate
the Company and review relevant factors and documents pertaining to
the officers of the Company, and the Company and its business and
to ask questions of a qualified representative of the Company
regarding this investment and the properties, operations, and
methods of doing business of the Company.
Have
you or has your purchaser representative, if any, conducted any
such investigation, sought such documents or asked questions of a
qualified representative of the Company regarding this investment
and the properties, operations, and methods of doing business of
the Company?
If so,
have you completed your investigation and/or received satisfactory
answers to your questions?
11.
Do you understand
the nature of an investment in the Company and the risks associated
with such an investment?
12.
Do you understand
that there is no guarantee of any financial return on this
investment and that you will be exposed to the risk of losing your
entire investment?
13.
Do you understand
that this investment is not liquid?
14.
Do you have
adequate means of providing for your current needs and personal
contingencies in view of the fact that this is not a liquid
investment?
15.
Are you aware of
the Company’s business affairs and financial condition, and
have you acquired all such information about the Company as you
deem necessary and appropriate to enable you to reach an informed
and knowledgeable decision to acquire the Interests?
16.
Do you have a
“pre-existing relationship” with the Company or any of
the officers of the Company?
(For
purposes hereof, “pre-existing relationship” means any
relationship consisting of personal or business contacts of a
nature and duration such as would enable a reasonably prudent
investor to be aware of the character, business acumen, and general
business and financial circumstances of the person with whom such
relationship exists.)
If so,
please name the individual or other person with whom you have a
pre-existing relationship and describe the
relationship:
______________________________________________________________________________
______________________________________________________________________________
Exceptions
to the representations and warranties made in Section 3.2 of the
Securities Purchase Agreement (if no exceptions, write
“none” – if left blank, the response will be
deemed to be “none”):
___________________________________________________
_____________________________________________________________________________
Dated:
_______________, 2018
If
purchaser is one or more individuals (all individuals must
sign):
(Type
or print name of prospective purchaser)
Signature
of prospective purchaser
Social
Security Number
(Type
or print name of additional purchaser)
Signature
of spouse, joint tenant, tenant in common or other signature, if
required
Social
Security Number
Annex A
Definition of Accredited Investor
The
securities will only be sold to investors who represent in writing
in the Securities Purchase Agreement that they are accredited
investors, as defined in Regulation D, Rule 501 under the Act which
definition is set forth below:
1.
A natural person
whose net worth, or joint net worth with spouse, at the time of
purchase exceeds $1 million (excluding home); or
2.
A natural person
whose individual gross income exceeded $200,000 or whose joint
income with that person’s spouse exceeded $300,000 in each of
the last two years, and who reasonably expects to exceed such
income level in the current year; or
3.
A trust with total
assets in excess of $5 million, not formed for the specific purpose
of acquiring the securities offered, whose purchase is directed by
a sophisticated person described in Regulation D; or
4.
A director or
executive officer of the Company; or
5.
The investor is an
entity, all of the owners of which are accredited investors;
or
6.
(a) bank as defined
in Section 3(a)(2) of the Act, or any savings and loan association
or other institution as defined in Section 3(a)(5)(A) of the Act,
(b) any broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934, (c) an insurance Company as
defined in Section 2(13) of the Act, (d) an investment Company
registered under the Investment Company Act of 1940 or a business
development Company as defined in Section 2(a)(48) of such Act, (e)
a Small Business Investment Company licensed by the United States
Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958, (f) an employee benefit plan
established and maintained by a state, its political subdivisions,
or any agency or instrumentality of a state or its political
subdivisions, if such plan has total assets in excess of $5
million, (g) an employee benefit plan within the meaning of Title I
of the Employee Retirement Income Securities Act of 1974, and the
employee benefit plan has assets in excess of $5 million, or the
investment decision is made by a plan fiduciary, as defined in
Section 3(21) of such act, that is either a bank, savings and loan
institution, insurance Company, or registered investment advisor,
or, if a self-directed plan, with an investment decisions made
solely by persons that are accredited investors, (h) a private
business development company as defined in Section 202(a)(22) of
the Investment Advisers Act of 1940, or (i) an organization
described in Section 501(c)(3) of the Internal Revenue code,
corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the
securities offered, with assets in excess of $5
million.
EXHIBIT
“A” TO ACCREDITED INVESTOR QUESTIONNAIRE
ACCREDITED
CORPORATIONS, PARTNERSHIPS, LIMITED LIABILITY COMPANIES, TRUSTS OR
OTHER ENTITIES INITIALING QUESTION 8B(xi) MUST PROVIDE THE
FOLLOWING INFORMATION.
I
hereby certify that set forth below is a complete list of all
equity owners in __________________ [NAME OF ENTITY], a
[TYPE OF ENTITY] formed pursuant to the laws of the State
of
. I also certify that
EACH
SUCH OWNER HAS INITIALED THE SPACE OPPOSITE HIS OR HER NAME
and that each such owner understands that by initialing that space
he or she is representing that he or she is an accredited
individual investor satisfying the test for accredited individual
investors indicated under “Type of Accredited
Investor.”
__________________________________________
signature of
authorized corporate officer, general partner or
trustee
Name of Equity
Owner
Type
of Accredited Investor
1
1
Indicate which
Subparagraph of 8.1 - 8.3 the equity owner satisfies.
Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
THIS
REGISTRATION RIGHTS AGREEMENT (this “
Agreement
”) is made as of
May __, 2018, among MabVax Therapeutics Holdings, Inc., a Delaware
corporation (the “
Company
”) and the
investor signatory hereto (the “
Investor
”). Capitalized
terms not otherwise defined herein shall have the meaning ascribed
to them in the Purchase Agreement (as defined below).
R
E C I T A L S
WHEREAS, the
Company and the Investor are parties to a Securities Purchase
Agreement (the “
Purchase Agreement
”),
dated as of the date hereof, as such may be amended and
supplemented from time to time;
WHEREAS, the
Investor’s obligations under the Purchase Agreement are
conditioned upon certain registration rights under the Securities
Act of 1933, as amended (the “
Securities Act
”);
and
WHEREAS, the
Investor and the Company desire to provide for the rights of
registration under the Securities Act as are provided herein upon
the execution and delivery of this Agreement by the Investor and
the Company.
NOW,
THEREFORE, in consideration of the promises, covenants and
conditions set forth herein, the parties hereto hereby agree as
follows:
1.1
Definitions
. As used in this
Agreement, the following terms shall have the meanings set forth
below:
(a)
“
Commission
” means the
United States Securities and Exchange
Commission.
per share.
(b)
“
Common
Stock
” means the Company’s common stock, $0.01
par value.
(
c)
“
Effectiveness Date
” means
the date that is the later of ninety 90 days after
t
he Trigger Date or
such date that the Commission’s Exchange Act Section 8(a)
examination (NY-9830 MabVax Therapeutics Holdings, Inc.) is deemed
closed and no longer pending.
(d)
“
Exchange
Act
” means the Securities Exchange Act of 1934, as
amended.
(e)
“
Filing
Date
” means the date that is thirty (30) days after
the Trigger Date.
(f)
“
Investor
” means any
person owning Registrable Securities who becomes party to this
Agreement by executing a counterpart signature page hereto, or
other agreement in writing to be bound by the terms hereof, which
is accepted by the Company.
(g)
The terms
“
register
,”
“registered
” and
“
registration
” refer to a
registration effected by preparing and filing a registration
statement or similar document in compliance with the Securities
Act, and the declaration or ordering of effectiveness of such
registration statement or document.
(h)
“
Registrable Securities
”
means 100% of the Underlying Shares (as defined in the Purchase
Agreement) issued pursuant to the Purchase Agreement;
provided
,
however
, that Registrable
Securities shall not include any securities of the Company that
have previously been registered and remain subject to a currently
effective registration statement or which have been sold to the
public either pursuant to a registration statement or Rule 144, or
which have been sold in a private transaction in which the
transferor’s rights under this Section 1 are not assigned, or
which may be sold immediately without registration under the
Securities Act and without restriction or imitation pursuant to
Rule 144 and without the requirement to be in compliance with Rule
144(c)(1).
(i)
“
Rule 144
” means Rule 144
as promulgated by the Commission under the Securities Act, as such
Rule may be amended from time to time, or any similar successor
rule that may be promulgated by the Commission.
(j)
“
Rule 415
” means Rule 415
as promulgated by the Commission under the Securities Act, as such
Rule may be amended from time to time, or any similar successor
rule that may be promulgated by the Commission.
(k)
“
Trigger Date
” means the
later of the closing of the transactions contemplated by the
Purchase Agreement or the date in which the Commission has informed
the Company that it will review registration
statements.
1.2
Company
Registration
.
(a)
On or prior to the
Filing Date, the Company shall prepare and file with the Commission
a registration statement covering the Registrable Securities for an
offering to be made on a continuous basis pursuant to Rule 415. The
registration statement shall be on Form S-1 or, if the Company is
so eligible, on Form S-3 (except if the Company is not then
eligible to register for resale the Registrable Securities on Form
S-1 or Form S-3, as the case may be, in which case such
registration shall be on another appropriate form in accordance
herewith) and shall contain (unless otherwise directed by the
Investor) substantially the “
Plan of Distribution
”
attached hereto as
Annex
A
. The Company shall cause the registration statement to
become effective and remain effective as provided herein. The
Company shall use its reasonable best efforts to cause the
registration statement to be declared effective under the
Securities Act as soon as possible and, in any event, by the
Effectiveness Date. The Company shall use its reasonable best
efforts to keep the registration statement continuously effective
under the Securities Act until all Registrable Securities covered
by such registration statement have been sold, or may be sold
without the requirement to be in compliance with Rule 144(c)(1) and
otherwise without restriction or limitation pursuant to Rule 144,
as determined by the counsel to the Company (the
“
Effectiveness
Period
”).
(b)
The Company shall
pay to the Investor a fee equal to 1% of the Investor’s
investment, payable in cash, for every thirty (30) day period, up
to a maximum of 12%, (i)following the Filing Date that the
registration statement has not been filed and (ii) following the
Effectiveness Date that the registration statement has not been
declared effective;
provided
,
however
, that the Company shall
not be obligated to pay any such liquidated damages if (i) the
Registrable Securities that would other be covered by the
registration statement may be sold without the requirement to be in
compliance with Rule 144(c)(1) and otherwise without restriction or
limitation pursuant to Rule 144 under the Securities Act or (ii)
the Company is unable to fulfill its registration obligations as a
result of rules, regulations, positions or releases issued or
actions taken by the Commission pursuant to its authority with
respect to “Rule 415”, and the Company registers at
such time the maximum number of shares of Common Stock permissible
upon consultation with the staff of the Commission.
(c)
If during the
Effectiveness Period, the number of Registrable Securities at any
time exceeds 100% of the number of shares of Common Stock then
registered in a registration statement, the Company shall file as
soon as reasonably practicable an additional registration statement
covering the resale of not less than the number of such Registrable
Securities.
(d)
The Company shall
bear and pay all expenses incurred in connection with any
registration, filing or qualification of Registrable Securities
with respect to the registrations pursuant to this Section 1.2 for
each Investor, including (without limitation) all registration,
filing and qualification fees, printer’s fees, accounting
fees and fees and disbursements of counsel for the Company, but
excluding any brokerage or underwriting fees, discounts and
commissions relating to Registrable Securities and fees and
disbursements of counsel for the Investor.
(e)
If at any time
during the Effectiveness Period there is not an effective
Registration Statement covering all of the Registrable Securities,
then the Company shall notify each Investor in writing at least
fifteen (15) days prior to the filing of any registration statement
under the Securities Act, in connection with a public offering of
shares of Common Stock (including, but not limited to, registration
statements relating to secondary offerings of securities of the
Company but excluding any registration statements (i) on Form S-4
or S-8 (or any successor or substantially similar form), or of any
employee stock option, stock purchase or compensation plan or of
securities issued or issuable pursuant to any such plan, or a
dividend reinvestment plan,
(ii) otherwise
relating to any employee, benefit plan or corporate reorganization
or other transactions covered by Rule 145 promulgated under the
Securities Act, (iii) on any registration form which does not
permit secondary sales or does not include substantially the same
information as would be required to be included in a registration
statement covering the resale of the Registrable Securities. In the
event an Investor desires to include in any such registration
statement all or any part of the Registrable Securities held by
such Investor, the Investor shall within ten (10) days after the
above-described notice from the Company, so notify the Company in
writing, including the number of such Registrable Securities such
Investor wishes to include in such registration statement. If an
Investor decides not to include all of its Registrable Securities
in any registration statement thereafter filed by the Company such
Investor shall nevertheless continue to have the right to include
any Registrable Securities in any subsequent registration statement
or registration statements as may be filed by the Company with
respect to the offering of the securities, all upon the terms and
conditions set forth herein.
1.3
Obligations of the Company
.
Whenever required under this Section 1 to effect the registration
of any Registrable Securities, the Company shall, as expeditiously
as reasonably possible:
(a)
Prepare and file
with the Commission a registration statement with respect to such
Registrable Securities and use its reasonable best efforts to cause
such registration statement to become effective and to keep such
registration statement effective during the Effectiveness
Period;
(b)
Prepare and file
with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection with
such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of
all securities covered by such registration statement;
(c)
Furnish to the
Investor such numbers of copies of a prospectus, including a
preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably
request in order to facilitate the disposition of Registrable
Securities owned by them (provided that the Company would not be
required to print such prospectuses if readily available to
Investor from any electronic service, such as on the EDGAR filing
database maintained at www.sec.gov);
(d)
Use its reasonable
best efforts to register and qualify the securities covered by such
registration statement under such other securities’ or blue
sky laws of such jurisdictions as shall be reasonably requested by
the Investor; provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any
such states or jurisdictions;
(e)
In the event of any
underwritten public offering, enter into and perform its
obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter(s) of such offering (each
Investor participating in such underwriting shall also enter into
and perform its obligations under such an agreement);
(f)
Promptly notify
each Investor holding Registrable Securities covered by such
registration statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act,
within one business day, (i) of the effectiveness of such
registration statement, or (ii) of the happening of any event as a
result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then
existing;
(g)
Cause all such
Registrable Securities registered pursuant hereto to be listed on
each securities exchange or nationally recognized quotation system
on which similar securities issued by the Company are then listed;
and
(h)
Provide a transfer
agent and registrar for all Registrable Securities registered
pursuant hereunder and a CUSIP number for all such Registrable
Securities, in each case not later than the effective date of such
registration.
1.4
Furnish Information
. It shall
be a condition precedent to the Company’s obligations to take
any action pursuant to this Section 1 with respect to the
Registrable Securities of any selling Investor that such Investor
shall furnish to the Company such information regarding such
Investor, the Registrable Securities held by such Investor, and the
intended method of disposition of such securities in the form
attached to this Agreement as Annex B, or as otherwise reasonably
required by the Company or the managing underwriters, if any, to
effect the registration of such Investor’s Registrable
Securities.
1.5
Delay of Registration
. No
Investor shall have any right to obtain or seek an injunction
restraining or otherwise delaying any such registration as the
result of any controversy that might arise with respect to the
interpretation or implementation of this Section 1.
1.6
Indemnification
.
(a)
To the extent
permitted by law, the Company will indemnify and hold harmless each
Investor, any underwriter (as defined in the Securities Act) for
such Investor and each person, if any, who controls such Investor
or underwriter within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages or liabilities
(joint or several) to which any of the foregoing persons may become
subject under the Securities Act, the Exchange Act or other federal
or state securities law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any of the following statements, omissions or violations
(collectively, a “
Violation
”): (i) any
untrue statement or alleged untrue statement of a material fact
contained in a registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments
or supplements thereto (collectively, the “
Filings
”), (ii) the
omission or alleged omission to state in the Filings a material
fact required to be stated therein, or necessary to make the
statements therein not misleading, or (iii) any violation or
alleged violation by the Company of the Securities Act, the
Exchange Act, any state securities law or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any state
securities law; and the Company will pay any legal or other
expenses reasonably incurred by any person to be indemnified
pursuant to this Section 1.6(a) in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided
,
however
, that the
indemnity agreement contained in this Section 1.6(a) shall not
apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without
the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any
such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon a Violation that occurs in reliance
upon and in conformity with written information furnished expressly
for use in connection with such registration by any such Investor,
underwriter or controlling person.
(b)
To the extent
permitted by law, each Investor will indemnify and hold harmless
the Company, each of its directors, each of its officers who has
signed the registration statement, each person, if any, who
controls the Company within the meaning of the Securities Act or
the Exchange Act, any underwriter, any other Investor selling
securities in such registration statement and any controlling
person of any such underwriter or other Investor, against any
losses, claims, damages or liabilities (joint or several) to which
any of the foregoing persons may become subject under the
Securities Act, the Exchange Act or other federal or state
securities law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are
based pon any Violation, in each case to the extent (and only to
the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Investor
expressly for use in connection with such registration; and each
such Investor will pay any legal or other expenses reasonably
incurred by any person to be indemnified pursuant to this Section
1.6(b) in connection with investigating or defending any such loss,
claim, damage, liability or action;
provided
,
however
, that the indemnity
agreement contained in this Section 1.6(b) shall not apply to
amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the
consent of the Investor (which consent shall not be unreasonably
withheld);
provided
,
however
, in no event shall any
indemnity under this subsection 1.6(b) exceed the net proceeds
received by such Investor upon the sale of the Registrable
Securities giving rise to such indemnification
obligation.
(c)
Promptly after
receipt by an indemnified party under this Section 1.6 of notice of
the commencement of any action (including any governmental action),
such indemnified party will, if a claim in respect thereof is to be
made against any indemnifying party under this Section 1.6, deliver
to the indemnifying party a written notice of the commencement
thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly
noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties;
provided
,
however
, that an indemnified
party (together with all other indemnified parties that may be
represented without conflict by one counsel) shall have the right
to retain one separate counsel, with the fees and expenses to be
paid by the indemnifying party, if representation of such
indemnified party by the counsel retained by the indemnifying party
would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to
deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if
materially prejudicial to its ability to defend such action, shall
relieve such indemnifying party of any liability to the indemnified
party under this Section 1.6, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party otherwise than
under this Section 1.6.
(d)
If the
indemnification provided for in Sections 1.6(a) and (b) is held by
a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, claim, damage or
expense referred to herein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to
the amount paid or payable by such indemnified party as a result of
such loss, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the indemnifying party
on the one hand and of the indemnified party on the other in
connection with the statements or omissions or alleged statements
or omissions that resulted in such loss, liability, claim or
expense as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified
party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact
relates to information supplied by the indemnifying party or by the
indemnified party and the parties’ relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission. In no event shall any Investor
be required to contribute an amount in excess of the net proceeds
received by such Investor upon the sale of the Registrable
Securities giving rise to such indemnification
obligation.
(e)
The obligations of
the Company and Investor under this Section 1.6 shall survive the
completion of any offering of Registrable Securities in a
registration statement under this Section 1, and
otherwise.
1.7
Reports Under Securities Exchange
Act
. With a view to making available the benefits of certain
rules and regulations of the Commission, including Rule 144, that
may at any time permit an Investor to sell securities of the
Company to the public without registration or pursuant to a
registration on Form S-1 or Form S-3, until all Registrable
Securities have been sold by the Investor, the Company agrees
to:
(a)
make and keep
public information available, as those terms are understood and
defined in Rule 144;
(b)
use reasonable best
efforts to file with the Commission in a timely manner all reports
and other documents required of the Company under the Securities
Act and the Exchange Act; and
(c)
furnish to any
Investor, so long as the Investor owns any Registrable Securities,
forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144 the
Securities Act and the Exchange Act (at any time after it has
become subject to such reporting requirements), or that it
qualifies as a registrant whose securities may be resold pursuant
to Form S-1 or Form S-3 (at any time after it so qualifies), (ii) a
copy of the most recent annual or quarterly report of the Company
and such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested in
availing any Investor of any rule or regulation of the Commission
that permits the selling of any such securities without
registration or pursuant to such form.
1.8
Transfer or Assignment of Registration
Rights
. The rights to cause the Company to register
Registrable Securities pursuant to this Section 1 may be
transferred or assigned, but only with all related obligations, by
an Investor to a transferee or assignee who (a) acquires at least
25,000 shares of Common Stock (or such equivalent amount of
Preferred Shares) (subject to appropriate adjustment for stock
splits, stock dividends and combinations) from such transferring
Investor, unless waived in writing by the Company, or (b) holds
Registrable Securities immediately prior to such transfer or
assignment;
provided
, that
in the case of (a), (i) prior to such transfer or assignment, the
Company is furnished with written notice stating the name and
address of such transferee or assignee and identifying the
securities with respect to which such registration rights are being
transferred or assigned, (ii) such transferee or assignee agrees in
writing to be bound by and subject to the terms and conditions of
this Agreement and (iii) such transfer or assignment shall be
effective only if immediately following such transfer or assignment
the further disposition of such securities by the transferee or
assignee is restricted under the Securities Act.
(a)
Each certificate
representing Shares and/or Underlying Shares held by the Investor
shall be endorsed with the following legend:
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED
OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF
COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH
SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THE SECURITIES
ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY
SUCH SECURITIES.”
(b)
The legend set
forth above shall be removed, and the Company shall issue a
certificate without such legend to the transferee of the Shares
and/or Underlying Shares represented thereby, if, unless otherwise
required by state securities laws, (i) such Shares and/or
Underlying Shares have been sold under an effective registration
statement under the Securities Act, (ii) in connection with a sale,
assignment or other transfer, such holder provides the Company with
an opinion of counsel, reasonably acceptable to the Company, to the
effect that such sale, assignment or transfer is being made
pursuant to an exemption from the registration requirements of the
Securities Act, or (iii) such holder provides the Company with
reasonable assurance that the Shares and/or Underlying Shares are
being sold, assigned or transferred pursuant to Rule 144 or Rule
144A under the Securities Act.
3.1
Governing Law
. The parties
hereby agree that any dispute which may arise between them arising
out of or in connection with this Agreement shall be adjudicated
only before a federal court located in the State of New York and
they hereby submit to the exclusive jurisdiction of the federal and
state courts of the State of New York with respect to any action or
legal proceeding commenced by any party, and irrevocably waive any
objection they now or hereafter may have respecting the venue of
any such action or proceeding brought in such a court or respecting
the fact that such court is an inconvenient forum, relating to or
arising out of this Agreement or any acts or omissions relating to
the registration of the securities hereunder, and consent to the
service of process in any such action or legal proceeding by means
of registered or certified mail, return receipt requested, in care
of the address set forth below or such other address as the
undersigned shall furnish in writing to the other.
3.2
WAIVER
OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY
JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE
PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY
3.3
Waivers and Amendments
. This
Agreement may be terminated and any term of this Agreement may be
amended or waived (either generally or in a particular instance and
either retroactively or prospectively) with the written consent of
the Company and the Investor. Notwithstanding the foregoing,
additional parties may be added as Investors under this Agreement,
and the definition of Registrable Securities expanded, with the
written consent of the Company and the Investor. No such amendment
or waiver shall reduce the aforesaid percentage of the Registrable
Securities, the holders of which are required to consent to any
termination, amendment or waiver without the consent of the record
holders of all of the Registrable Securities. Any termination,
amendment or waiver effected in accordance with this Section 3.3
shall be binding upon each holder of Registrable Securities then
outstanding, each future holder of all such Registrable Securities
and the Company.
3.4
Successors and Assigns
. Except
as otherwise expressly provided herein, the provisions of this
Agreement shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the
parties hereto.
3.5
Entire Agreement
. This
Agreement constitutes the full and entire understanding and
agreement among the parties with regard to the subject matter
hereof, and no party shall be liable or bound to any other party in
any manner by any warranties, representations or covenants except
as specifically set forth herein.
3.6
Notices
. All notices and other
communications required or permitted under this Agreement shall be
in writing and shall be delivered personally by hand or by
overnight courier, mailed by United States first-class mail,
postage prepaid, sent by facsimile or sent by electronic mail
directed (a) if to an Investor, at such Investor’s address,
facsimile number or electronic mail address set forth in the
Company’s records, or at such other address, facsimile number
or electronic mail address as such Investor may designate by ten
(10) days’ advance written notice to the other parties hereto
or (b) if to the Company, to its address, facsimile number or
electronic mail address set forth on its signature page to this
Agreement and directed to the attention of its President, or at
such other address, facsimile number or electronic mail address as
the Company may designate by ten (10) days’ advance written
notice to the other parties hereto. All such notices and other
communications shall be effective or deemed given upon delivery, on
the date that is three (3) days following the date of mailing, upon
confirmation of facsimile transfer or upon confirmation of
electronic mail delivery.
3.7
Interpretation
. The words
“include,” “includes” and
“including” when used herein shall be deemed in each
case to be followed by the words “without limitation.”
The titles and subtitles used in this Agreement are used for
convenience only and are not considered in construing or
interpreting this Agreement.
3.8
Severability
. If one or more
provisions of this Agreement are held to be unenforceable under
applicable law, such provision shall be excluded from this
Agreement, and the balance of the Agreement shall be interpreted as
if such provision were so excluded, and shall be enforceable in
accordance with its terms.
3.9
Counterparts
. This Agreement
may be executed in any number of counterparts, each of which shall
be an original, but all of which together shall constitute one
instrument.
3.10
Telecopy
Execution and Delivery
. A facsimile, telecopy or other
reproduction of this Agreement may be executed by one or more
parties hereto, and an executed copy of this Agreement may be
delivered by one or more parties hereto by facsimile or similar
electronic transmission device pursuant to which the signature of
or on behalf of such party can be seen, and such execution and
delivery shall be considered valid, binding and effective for all
purposes. At the request of any party hereto, all parties hereto
agree to execute an original of this Agreement as well as any
facsimile, telecopy or other reproduction hereof.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer, as of the date, month and
year first set forth above.
MABVAX
THERAPEUTICS HOLDINGS, INC.
By:
/s/ J. David
Hansen
Name: J. David
Hansen
Title:
President and CEO
Address for
notice
:
11535
Sorrento Valley Road, Suite 400
San
Diego, CA 92121
[COMPANY
SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
IN
WITNESS WHEREOF, the undersigned Investor has executed this
Agreement as of the date, month and year that such Investor became
the owner of Registrable Securities.
“Investor”
By:
Name
Title:
Address:
[INVESTOR
COUNTERPART SIGNATURE PAGE TO REGISTRATION RIGHTS
AGREEMENT]
Annex A
Plan of Distribution
Each
selling stockholder of the common stock and any of their pledgees,
assignees and successors-in-interest may, from time to time, sell
any or all of their shares of common stock on The NASDAQ Capital
Market or any other stock exchange, market or trading facility on
which the shares are traded or in private transactions. These sales
may be at fixed or negotiated prices. A selling stockholder may use
any one or more of the following methods when selling
shares:
●
ordinary brokerage
transactions and transactions in which the broker-dealer solicits
purchasers;
●
block trades in
which the broker-dealer will attempt to sell the shares as agent
but may position and resell a portion of the block as principal to
facilitate the transaction;
●
purchases by a
broker-dealer as principal and resale by the broker-dealer for its
account;
●
an exchange
distribution in accordance with the rules of the applicable
exchange;
●
privately
negotiated transactions;
●
settlement of short
sales entered into after the effective date of the registration
statement of which this prospectus is a part;
●
broker-dealers may
agree with the selling stockholders to sell a specified number of
such shares at a stipulated price per share;
●
through the writing
or settlement of options or other hedging transactions, whether
through an options exchange or otherwise;
●
a combination of
any such methods of sale; or
●
any other method
permitted pursuant to applicable law.
The
selling stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended, if available, rather than under
this prospectus.
Broker-dealers
engaged by the selling stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the selling stockholders (or, if any
broker-dealer acts as agent for the purchaser of shares, from the
purchaser) in amounts to be negotiated, but, except as set forth in
a supplement to this prospectus, in the case of an agency
transaction not in excess of a customary brokerage commission in
compliance with FINRA Rule 2440; and in the case of a principal
transaction a markup or markdown in compliance with FINRA
IM-2440.
In
connection with the sale of the common stock or interests therein,
the selling stockholders may enter into hedging transactions with
broker-dealers or other financial institutions, which may in turn
engage in short sales of the common stock in the course of hedging
the positions they assume. The selling stockholders may also sell
shares of the common stock short and deliver these securities to
close out their short positions, or loan or pledge the common stock
to broker-dealers that in turn may sell these securities. The
selling stockholders may also enter into option or other
transactions with broker-dealers or other financial institutions or
the creation of one or more derivative securities which require the
delivery to such broker-dealer or other financial institution of
shares offered by this prospectus, which shares such broker-dealer
or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such
transaction).
The
selling stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be
“underwriters” within the meaning of the Securities Act
of 1933, as amended, in connection with such sales. In such event,
any commissions received by such broker- dealers or agents and any
profit on the resale of the shares purchased by them may be deemed
to be underwriting commissions or discounts under the Securities
Act of 1933, as amended. Each selling stockholder has informed us
that it does not have any written or oral agreement or
understanding, directly or indirectly, with any person to
distribute the common stock.
We are
required to pay certain fees and expenses incurred by us incident
to the registration of the shares. We have agreed to indemnify the
selling stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act of
1933, as amended.
Because
selling stockholders may be deemed to be “underwriters”
within the meaning of the Securities Act of 1933, as amended, they
will be subject to the prospectus delivery requirements of the
Securities Act of 1933, as amended, including Rule 172 thereunder.
In addition, any securities covered by this prospectus which
qualify for sale pursuant to Rule 144 under the Securities Act of
1933, as amended may be sold under Rule 144 rather than under this
prospectus. There is no underwriter or coordinating broker acting
in connection with the proposed sale of the resale shares by the
selling stockholders.
We
agreed to keep this prospectus effective until the earlier of (i)
the date on which the shares may be resold by the selling
stockholders without registration and without the requirement to be
in compliance with Rule 144(c)(1) and otherwise without restriction
or limitation pursuant to Rule 144 or (ii) all of the shares have
been sold pursuant to this prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The resale
shares will be sold only through registered or licensed brokers or
dealers if required under applicable state securities laws. In
addition, in certain states, the resale shares may not be sold
unless they have been registered or qualified for sale in the
applicable state or an exemption from the registration or
qualification requirement is available and is complied
with.
Under
applicable rules and regulations under the Securities Exchange Act
of 1934, as amended, any person engaged in the distribution of the
resale shares may not simultaneously engage in market making
activities with respect to the common stock for the applicable
restricted period, as defined in Regulation M, prior to the
commencement of the distribution. In addition, the selling
stockholders will be subject to applicable provisions of the
Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, including Regulation M, which may limit the
timing of purchases and sales of shares of the common stock by the
selling stockholders or any other person. We will make copies of
this prospectus available to the selling stockholders and have
informed them of the need to deliver a copy of this prospectus to
each purchaser at or prior to the time of the sale (including by
compliance with Rule 172 under the Securities Act of 1933, as
amended).
Annex B
Selling
Securityholder Notice and Questionnaire
The
undersigned beneficial owner of common stock (the
“
Registrable
Securities
”) of MabVax Therapeutics Holdings, Inc., a
Delaware corporation (the “
Company
”), understands
that the Company has filed or intends to file with the Securities
and Exchange Commission (the “
Commission
”) a
registration statement (the “
Registration Statement
”)
for the registration and resale under Rule 415 of the Securities
Act of 1933, as amended (the “
Securities Act
”), of the
Registrable Securities, in accordance with the terms of the
Registration Rights Agreement (the “
Registration Rights
Agreement
”) to which this document is annexed. A copy
of the Registration Rights Agreement is available from the Company
upon request at the address set forth below. All capitalized terms
not otherwise defined herein shall have the meanings ascribed
thereto in the Registration Rights Agreement.
Certain
legal consequences arise from being named as a selling
securityholder in the Registration Statement and the related
prospectus. Accordingly, holders and beneficial owners of
Registrable Securities are advised to consult their own securities
law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Registration Statement and
the related prospectus.
NOTICE
The
undersigned beneficial owner (the “
Selling Securityholder
”)
of Registrable Securities hereby elects to include the Registrable
Securities owned by it in the Registration Statement.
The
undersigned hereby provides the following information to the
Company and represents and warrants that such information is
accurate:
QUESTIONNAIRE
1.
Name.
(a)
Full Legal Name of
Selling Securityholder
(b)
Full Legal Name of
Registered Holder (if not the same as (a) above) through which
Registrable Securities are held:
(c)
Full
Legal Name of Natural Control Person (which means a natural person
who directly or indirectly alone or with others has power to vote
or dispose of the securities covered by this
Questionnaire):
2.
Address
for Notices to Selling Securityholder:
Telephone:
|
Fax:
|
Contact
Person:
|
(a)
Are you a
broker-dealer?
(b)
If
“yes” to Section 3(a), did you receive your Registrable
Securities as compensation for investment banking services to the
Company?
Note:
If “no” to Section 3(b), the Commission’s staff
has indicated that you should be identified as an underwriter in
the Registration Statement.
(c)
Are you an
affiliate of a broker-dealer?
(d)
If you are an
affiliate of a broker-dealer, do you certify that you purchased the
Registrable Securities in the ordinary course of business, and at
the time of the purchase of the Registrable Securities to be
resold, you had no agreements or understandings, directly or
indirectly, with any person to distribute the Registrable
Securities?
Note:
If “no” to Section 3(d), the Commission’s staff
has indicated that you should be identified as an underwriter in
the Registration Statement.
4.
Beneficial
Ownership of Securities of the Company Owned by the Selling
Securityholder.
Except as set forth below in this Item 4, the undersigned is not
the beneficial or registered owner of any securities of the Company
other than the securities issuable pursuant to the Purchase
Agreement.
(a)
Type and Amount of
other securities beneficially owned by the Selling
Securityholder:
5.
Relationships
with the Company:
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equity holders (owners
of 5% of more of the equity securities of the undersigned) has held
any position or office or has had any other material relationship
with the Company (or its predecessors or affiliates) during the
past three years.
State
any exceptions here:
The
undersigned agrees to promptly notify the Company of any
inaccuracies or changes in the information provided herein that may
occur subsequent to the date hereof at any time while the
Registration Statement remains effective.
By
signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to Items 1 through 5
and the inclusion of such information in the Registration Statement
and the related prospectus and any amendments or supplements
thereto. The undersigned understands that such information will be
relied upon by the Company in connection with the preparation or
amendment of the Registration Statement and the related
prospectus.
IN
WITNESS WHEREOF the undersigned, by authority duly given, has
caused this Notice and Questionnaire to be executed and delivered
either in person or by its duly authorized agent.
Date:
Beneficial
Owner:
By:
Name:
Title:
[SIGNATURE
PAGE FOR SELLING SECURITYHOLDER NOTICE AND
QUESTIONNAIRE]
Exhibit 10.3
MabVax Therapeutics Holdings, Inc.
11535 Sorrento Valley Rd., Suite 400
San Diego, CA 92121
Phone: (858) 259-9405
April
26, 2018
Re:
Letter Agreement
MabVax Therapeutics
Holdings, Inc. (the “Company”)
and the
undersigned
hereby agree
pursuant to this agreement (this “April 2018 Letter
Agreement”) that:
A.
April 2018 Inducement Shares
The undersigned, upon delivery to the
Company of the undersigned’s investment in the
Company’s April 2018 private placement of up to $1.0 million
(the “April 2018 Offering”) of at least 40% of the
undersigned’s share of investment in the Company’s
aggregate private placements of $2.75 million in February 2018 (the
“February 2018 Private Placements”), or at least
$300,000
(the “Minimum
Required Investment”)
, shall be entitled to receive its pro
rata share, along with the other investors in the February 2018
Private Placements who invest in the April 2018 Offering, of up to
1,277,777 shares of common stock equivalents in the form of Series
O Convertible Preferred Stock, the form of which is attached hereto
as Exhibit A, to be fully allocated upon the maximum investment of
$1.0 million, or pro-rata portion thereof if less than $1.0 million
(the “April 2018 Inducement Shares”)
that will include: (A) a beneficial
conversion blocker for any one of the undersigned who beneficially
owns or as a result of any purchases in the April 2018 Offering or
issuances and conversion of the April 2018 Inducement Shares or
otherwise will beneficially own 5% or more of the common stock of
the Company (the “beneficial ownership blocker”) and
(B) a liquidation preference equal to the par value thereof. The
Company shall issue the April 2018 Inducement Shares as restricted
securities, unless in the opinion of counsel to the Company such
shares are deemed to be registered under the Securities Act of
1933, as amended (the “Act”) and if not so registered
shall within 30 days of the later to occur of (i) issuance of the
April 2018 Inducement Shares and (ii) the date the Securities and
Exchange Commission agrees to begin reviewing future filings of the
Company’s registration statements, file a registration
statement under the Act with respect to the common stock underlying
the April 2018 Inducement Shares, and shall issue such shares
within five (5) business days of closing of the Offering. No April
2018 Inducement Shares shall be required to be issued to the
undersigned in connection with the April 2018 Offering, if the
undersigned does not invest at least 40% of such
undersigned’s investment in the February 2018 Private
Placement, in the April 2018 Offering.
In the
event of a liquidation, dissolution or winding up of the Company,
each share of the April 2018 Inducement Shares will be entitled to
a per share preferential payment equal to the par value of $0.01
per share.
This Letter Agreement shall be governed by the laws of the state of
New York, without giving effect to any conflict of laws provision,
and may not be amended other than through a written agreement
executed by the Company and the undersigned.
MabVax Therapeutics Holdings,
Inc.
Investor
By:
/s/ J. David
Hansen
By: ________________________
Name: J.
David Hansen
Name:
Title: President
and CEO
Exhibit A – Form of Series O Convertible Preferred
Stock
Exhibit 99.1
MabVax Therapeutics Holdings, Inc. Announces Private Placement
Offering
SAN DIEGO, May 3, 2018
– MabVax Therapeutics Holdings, Inc.
(Nasdaq: MBVX), a clinical-stage biotechnology company focused on
the development of antibody-based products to address unmet medical
needs in the treatment of cancer, today announced
it has
entered into securities purchase agreements with accredited
investors pursuant to which the Company has agreed to sell $860,000
worth of shares of the Company’s newly designated
0% Series N
Convertible Preferred Stock (the “Series N Preferred
Stock”)
. Transaction costs are estimated to be
$10,000. The initial conversion price for the Series N Preferred
Stock is $1.10 per share of common stock. The offering is expected
to close on or before May 7, 2018.
In
connection with this offering, the Company offered incentive shares
to prior investors who participated in the Company’s private
offering in February 2018 as an incentive for the prior investors
to make a minimum investment in this offering equal to 40% of their
investment in February 2018. Assuming the prior investors invest at
least 40% of their prior investment in this offering, they shall be
entitled to receive their pro rata share of up to 10,988.88 shares
of a new 0% Series O Convertible Preferred Stock (the “Series
O Preferred Stock”), initially convertible into 1,098,888
shares of common stock.
Neither
the Series N Preferred Stock nor the Series O Preferred Stock will
be separately listed on any securities exchange or other trading
market. The shares of Series N Preferred Stock and Series O
Preferred Stock were offered and are being sold to certain
accredited investors in a private placement. No bank was used for
this transaction.
“The
incremental funds from this financing are intended to provide
additional operating capital while we continue to work toward
closing potential strategic transactions with companies interested
in certain products in our development pipeline,” stated
President and CEO David Hansen. “These funds together with
payments we expect to receive from these potential transactions
should help us to sustain our spending on key programs in our
development pipeline for the remainder of the
year.”
MabVax
intends to use the net proceeds of the offering to fund continuing
clinical development of its HuMab 5B1 antibody designated
MVT-5873
in
combination with gemcitabine and nab-paclitaxal in first line
therapy for the treatment of patients newly diagnosed with
pancreatic cancer. The Company has treated two cohorts of patients
for a total of six patients to date in this study; and these funds
will enable the Company to continue enrolling up to approximately
10 additional patients with the objective of confirming early
observations. The additional funding will also support the
continued clinical development of the Company’s
radioimmunotherapy product designated as
MVT-1075
for
the treatment of locally advanced or metastatic pancreatic cancer
patients. MabVax initiated the phase I study of MVT-1075 in June
2017 and is in the process of treating additional patients to
continue to assess the safety and potential efficacy of this
treatment. Funds will also be used for general corporate
purposes.
This
press release shall not constitute an offer to sell or a
solicitation of an offer to buy, nor shall there be any sale of
these securities in any state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.
About MabVax:
MabVax Therapeutics Holdings, Inc. is a clinical-stage
biotechnology company with a fully human antibody discovery
platform focused on the rapid translation into clinical development
of products to address unmet medical needs in the treatment of
cancer. Our antibody MVT-5873, is afully human IgG1 monoclonal
antibody (mAb) that targets sialyl Lewis A (sLea), an epitope on
CA19-9, and is currently in Phase 1 clinical trials as a
therapeutic agent for patients with pancreatic cancer and other
CA19-9 positive tumors. CA19-9 is expressed in over 90% of
pancreatic cancers and in other diseases including small cell lung
and GI cancers. CA19-9 plays an important role in tumor adhesion
and metastasis, and is a marker of an aggressive cancer phenotype.
CA19-9 serum levels are considered a valuable adjunct in the
diagnosis, prognosis and treatment monitoring of pancreatic cancer.
With our collaborators including Memorial Sloan Kettering Cancer
Center, Sarah Cannon Research Institute, Honor Health and Imaging
Endpoints, we have treated over 56 patients with either our
therapeutic antibody designated as MVT-5873 or our PET imaging
diagnostic product designated as MVT-2163 in Phase 1 clinical
studies, and demonstrated early safety and specificity for the
target. Patient dosing is continuing in Phase 1 clinical studies of
MVT-5873 in combination with nab-paclitaxel and gemcitabine to
patients newly diagnosed with CA19-9 positive pancreatic cancer,
and for the Company's radioimmunotherapy product MVT-1075. Our
human antibody targeting Tn and sTn is in preclinical development.
For additional information, please visit the Company's
website,
www.mabvax.com
.
Forward Looking Statements:
This
press release on announcing the private placement contains
"forward-looking statements" regarding matters that are not
historical facts, including statements relating to the financing
and use of proceeds, the Company's MVT-5873, MVT-2163 and MVT-1075
clinical development programs, and the Company’s human
antibody targeting Tn and sTn in preclinical development. We have
no assurance that all the product development pipeline will be
fully developed by the Company. Further, we have no assurance
that potential strategic transactions will be completed in a timely
manner, if at all. Because such statements are subject to risks and
uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements. Words
such as "anticipates," "plans," "expects," "intends," "will,"
"potential," "hope" and similar expressions are intended to
identify forward-looking statements. These forward-looking
statements are based upon current expectations of the Company and
involve assumptions that may never materialize or may prove to be
incorrect. Actual results and the timing of events could differ
materially from those anticipated in such forward-looking
statements as a result of various risks and uncertainties. Detailed
information regarding factors that may cause actual results to
differ materially from the results expressed or implied by
statements in this press release relating to the Company may be
found in the Company's periodic filings with the Securities and
Exchange Commission, or SEC, including the factors described in the
section entitled "Risk Factors" in its annual report on Form 10-K
for the fiscal year ended December 31, 2017, as amended and
supplemented from time to time and the Company's Quarterly
Reports on Form 10-Q and other filings submitted by the Company to
the SEC, copies of which may be obtained from the SEC's website
at
www.sec.gov
.
The parties do not undertake any obligation to update
forward-looking statements contained in this press
release.
MabVax Investor Contact:
Email:
MabVaxIR@mabvax.com
Phone:
833-208-6789
Media Contact:
Russo
Partners LLC
Phone:
212-845-4272
Email:
travis.kruse@russopartnersllc.com