UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT
TO RULE 13d-2(a)
(Amendment No. 1)*
HYBRIDON, INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
44860M108
(CUSIP Number)
Youssef El-Zein
28, rue de Lubeck
75016 Paris, France
33-(01) 56-28-08-75
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 27, 2004
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[ ].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 14 Pages)
____________________
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
CUSIP NO. 44860M108 Page 2 of 14 Pages
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Youssef El-Zein
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A
GROUP
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC, OO
- --------------------------------------------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
France
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 1,868,085
BENEFICIALLY ------------------------------------------------------
OWNED BY
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 11,492,444
WITH ------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,868,085
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
11,492,444
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
13,360,529
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
Not applicable
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11.7%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
SCHEDULE 13D
CUSIP NO. 44860M108 Page 3 of 14 Pages
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Pillar Investment Limited
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC, OO
- --------------------------------------------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Isle of Man
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 1,020,229
BENEFICIALLY --------- --------------------------------------------
OWNED BY
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 10,472,215
WITH --------- --------------------------------------------
9 SOLE DISPOSITIVE POWER
1,020,229
--------- --------------------------------------------
10 SHARED DISPOSITIVE POWER
10,472,215
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,492,444
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
Not applicable
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.1%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
OO
- --------------------------------------------------------------------------------
SCHEDULE 13D
CUSIP NO. 44860M108 Page 4 of 14 Pages
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Optima Life Sciences Limited
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
- --------------------------------------------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Isle of Man
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 10,472,215
BENEFICIALLY ------------------------------------------------------
OWNED BY
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 0
WITH ------------------------------------------------------
9 SOLE DISPOSITIVE POWER
10,472,215
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
10,472,215
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
Not applicable
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
OO
- --------------------------------------------------------------------------------
SCHEDULE 13D
CUSIP NO. 44860M108 Page 5 of 14 Pages
This Amendment No. 1 ("Amendment") to the original Schedule 13D filed
September 8, 2003, is being filed on behalf of Youssef El-Zein, Pillar
Investment Limited, a limited company incorporated under the laws of the Isle of
Man ("Pillar"), and Optima Life Sciences Limited, a limited company incorporated
under the laws of the Isle of Man ("Optima" and, together with Youssef El-Zein
and Pillar, the "Reporting Parties"). Mr. El-Zein is a director of Pillar and of
Optima. Pillar is the manager and investment advisor of Optima and holds all of
the voting shares of Optima.
Item 1. Security and Issuer.
This Amendment relates to the Common Stock, $0.001 par value per share
(the "Common Stock"), of Hybridon, Inc., a Delaware corporation (the "Company").
The address of the principal executive office of the Company is 345 Vassar
Street, Cambridge, Massachusetts 02139-4818.
Item 2. Identity and Background.
(a) This statement is being filed by the Reporting Parties:
Youssef El-Zein, Pillar and Optima.
(b) The business address of Mr. El-Zein is St. James's Chambers,
64A Athol Street, Isle of Man IM1 1JE.
(c) Mr. El-Zein's principal occupation is serving as a director of
Pillar.
The principal business of Pillar is providing managerial
investment advisory services to Optima. The address of Pillar
is St. James's Chambers, 64A Athol Street, Isle of Man IM1
1JE.
The principal business of Optima is investing in and holding
securities of the Company. The address of Optima is St.
James's Chambers, 64A Athol Street, Isle of Man IM1 1JE.
(d) None of the Reporting Parties and, to the knowledge of the
Reporting Parties, none of the Listed Directors (as defined
below), has, during the last five years, been convicted in a
criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) None of the Reporting Parties and, to the knowledge of the
Reporting Parties, none of the Listed Directors, has, during
the last five years, been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and
as a
SCHEDULE 13D
CUSIP NO. 44860M108 Page 6 of 14 Pages
result or such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to
such laws.
(f) Mr. El-Zein is a citizen of France. Pillar and Optima were
organized under the laws of the Isle of Man.
In accordance with the provisions of General Instruction C to Schedule
13D, information required by Item 2 of Schedule 13D with respect to the
directors of Pillar and Optima is listed on Schedule 1 hereto and is
incorporated by reference herein. Pillar and Optima have no executive officers.
Mr. Bilal Sidani serves with Mr. El-Zein as a director of Pillar, and Mr. Sidani
and Mr. David Burge serve with Mr. El-Zein as directors of Optima. Messrs.
Sidani and Burge are referred to herein as the "Listed Directors."
Item 3. Source and Amount of Funds or Other Consideration.
On August 28, 2003, Optima purchased 5,500,381 shares of Common Stock
and warrants to purchase 1,650,114 shares of Common Stock (the "2003 Optima
Warrants") for a total purchase price of $4,015,278.38 in a private financing
consummated by the Company on August 28, 2003 and August 29, 2003 (collectively,
the "2003 Private Financing"). The 2003 Optima Warrants have an exercise price
of $1.00 per share of Common Stock and are exercisable on or prior to August 28,
2008. Optima purchased these securities pursuant to a Subscription Agreement,
dated as of August 28, 2003 between the Company and Optima (the "2003
Subscription Agreement"). Optima used its working capital to purchase these
securities. The Company also issued warrants to purchase 587,709 shares of
Common Stock to Pillar on August 28, 2003 (the "2003 Pillar Warrants"). The 2003
Pillar Warrants have an exercise price of $1.00 per share and are exercisable on
or prior to August 28, 2008. The 2003 Pillar Warrants were issued to Pillar as
part of Pillar's placement agent fees in connection with the participation of
certain non-U.S. investors in the 2003 Private Financing, including Optima,
pursuant to an engagement letter dated as of April 18, 2003 (the "2003
Engagement Letter"), by and among the Company, Pillar and PrimeCorp Finance S.A.
This Amendment relates to the additional purchase on August 27, 2004,
by Optima of 2,768,100 shares of Common Stock and warrants to purchase 553,620
shares of Common Stock (the "2004 Optima Warrants" and together with the 2003
Optima Warrants, the "Optima Warrants") for a total purchase price of $1,600,000
in a private financing consummated by the Company on August 27, 2004 (the "2004
Private Financing"). The amount paid was based on a market price for the Common
Stock of $.553 per share. The 2004 Optima Warrants have an exercise price of
$0.67 per share of Common Stock and are exercisable on or prior to August 27,
2009. Optima purchased these securities pursuant to a Subscription Agreement,
dated as of
SCHEDULE 13D
CUSIP NO. 44860M108 Page 7 of 14 Pages
August 27, 2004 between the Company and Optima (the "2004 Subscription
Agreement"). Optima used its working capital to purchase these securities.
In connection with the 2004 Private Financing, the Company issued
warrants to purchase 432,520 shares of Common Stock to Pillar on August 27, 2004
(the "2004 Pillar Warrants" and together with the 2003 Pillar Warrants, the
"Pillar Warrants"). The 2004 Pillar Warrants have an exercise price of $0.67 per
share and are exercisable on or prior to August 27, 2009. The 2004 Pillar
Warrants were issued to Pillar as part of Pillar's placement agent fees in
connection with the participation of certain non-U.S. investors in the 2004
Private Financing, including Optima, pursuant to an engagement letter dated as
of August 27, 2004 (the "2004 Engagement Letter"), by and between the Company
and Pillar.
Prior to the transactions on August 27, 2004, Mr. El-Zein beneficially
owned 1,868,085 shares of Common Stock. These shares include 40,250 shares of
Common Stock issuable upon exercise of stock options granted to Mr. El-Zein as a
director of the Company and currently exercisable (or exercisable within 60 days
after this amendment) and 1,827,835 shares of Common Stock held by Mr. El-Zein
directly. Mr. El-Zein acquired these securities primarily from certain
stockholders of the Company and from distributions from Pillar and certain
affiliates of Pillar. The securities distributed by Pillar and its affiliates to
Mr. El-Zein include securities issued to Pillar and its affiliates as payment
for consulting advisory services, including fees in connection with the
Company's financings in 1998, 1999 and 2000.
Item 4. Purpose of the Transaction.
The acquisition by Optima of the shares of Common Stock and warrants
beneficially owned by the Reporting Parties was effected because of the
Reporting Parties' belief that the Common Stock represents an attractive
investment. Mr. El-Zein and Pillar also accepted securities of the Company as
payment for consulting advisory services because of the Reporting Parties'
belief that the Common Stock represents an attractive investment. The Reporting
Parties may from time to time acquire additional shares of Common Stock or
warrants or engage in discussions with the Company concerning further
acquisitions of shares of Common Stock or warrants, or further investments in
the Company.
In particular, as a director of the Company, Mr. El-Zein is entitled to
receive stock options pursuant to the Company's director stock option plan. In
addition, Pillar may acquire additional warrants from the Company under the
terms of the 2004 Engagement Letter if the Company conducts additional closings
under the 2004 Private Financing with investors identified by Pillar.
The Reporting Parties intend to review their investments in the Company
on a continuing basis and, depending upon the price and availability of shares
of Common Stock, subsequent
SCHEDULE 13D
CUSIP NO. 44860M108 Page 8 of 14 Pages
developments affecting the Company, the Company's business and prospects, other
investment and business opportunities available to the Reporting Parties,
general stock market and economic conditions, tax considerations and other
factors considered relevant, may decide at any time to increase, or to decrease,
the size of their investments in the Company.
Except as set forth above in this Amendment, none of the Reporting
Parties and, to the knowledge of the Reporting Parties, none of the Listed
Directors, has any current plans or proposals that relate to or would result in:
(a) the acquisition by any person of additional securities of the Company, or
the disposition of securities of the Company; (b) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, involving the
Company or any of its subsidiaries; (c) a sale or transfer of a material amount
of assets of the Company or any of its subsidiaries; (d) any change in the
present Board of Directors or management of the Company, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board; (e) any material change in the present capitalization or
dividend policy of the Company; (f) any other material change in the Company's
business or corporate structure; (g) changes in the Company's charter, by-laws
or instruments corresponding thereto or other actions which may impede the
acquisition of control of the Company by any person; (h) causing a class of
securities of the Company to be delisted from a national securities exchange or
to cease to be authorized to be quoted in an inter-dealer quotation system of a
registered national securities association; (i) a class of equity securities of
the Company becoming eligible for termination of registration pursuant to
Section 12(g)(4) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); or (j) any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) Youssef El-Zein beneficially owns 13,360,529 shares of Common
Stock. These shares represent approximately 11.7% of the
Common Stock outstanding. These shares include (i) 1,827,835
shares of Common Stock held directly by Mr. El-Zein, (ii)
40,250 shares of Common Stock which Mr. El-Zein has the right
to acquire upon the exercise of stock options during the
60-day period commencing August 27, 2004, (iii) 1,020,229
shares of Common Stock issuable upon exercise of the Pillar
Warrants, (iv) 8,268,481 shares of Common Stock held by Optima
and (v) 2,203,734 shares of Common Stock issuable upon
exercise of the Optima Warrants. Because of his relationship
with Pillar and Optima, Mr. El-Zein may be deemed to
beneficially own all of the shares of Common Stock that Pillar
and Optima beneficially own.
Pillar beneficially owns 11,492,444 shares of Common Stock.
These shares represent approximately 10.1% of the Common Stock
outstanding. These shares include (i) 1,020,229 shares of
Common Stock issuable upon exercise of the Pillar
SCHEDULE 13D
CUSIP NO. 44860M108 Page 9 of 14 Pages
Warrants, (ii) 8,268,481 shares of Common Stock held by Optima
and (iii) 2,203,734 shares of Common Stock issuable upon
exercise of the Optima Warrants. As the holder of all of the
voting shares of Optima, Pillar has the ability to elect and
remove the directors of Optima, and, as a result, may be
deemed to beneficially own all of the shares of Common Stock
that Optima beneficially owns.
Optima beneficially owns 10,472,215 shares of Common Stock.
These shares represent approximately 9.3% of the Common Stock
outstanding. These shares include (i) 8,268,481 shares of
Common Stock held by Optima and (ii) 2,203,734 shares of
Common Stock issuable upon exercise of the Optima Warrants.
Neither of the Listed Directors owns any shares of Common
Stock.
(b) Number of shares as to which each of the Reporting Parties
has:
Sole power to vote or to direct the vote of shares of Common
Stock:
Mr. El-Zein: 1,868,085
Pillar: 1,020,229
Optima: 10,472,215
Shared power to vote or to direct the vote of shares of Common
Stock:
Mr. El-Zein: 11,492,444
Pillar: 10,472,215
Optima: 0
Sole power to dispose of or direct the disposition of shares
of Common Stock:
Mr. El-Zein: 1,868,085
Pillar: 1,020,229
Optima: 10,472,215
Shared power to dispose or to direct the disposition of shares
of Common Stock:
Mr. El-Zein: 11,492,444
Pillar: 10,472,215
Optima: 0
SCHEDULE 13D
CUSIP NO. 44860M108 Page 10 of 14 Pages
(c) Except as described below, none of the Reporting Parties and,
to the knowledge of the Reporting Parties, none of the Listed
Directors has effected any transactions in the Common Stock
during the past 60 days:
(i) Optima purchased 2,768,100 shares of Common Stock and
warrants to purchase 553,620 shares of Common Stock
in the 2004 Private Financing on August 27, 2004. The
description of this transaction is included in the
second paragraph of Item 3 to this Amendment and is
incorporated herein by reference.
(ii) Pillar acquired warrants to purchase 432,520 shares
of Common Stock on August 27, 2004. The description
of this transaction is included in the third
paragraph of Item 3 of this Amendment and is
incorporated herein by reference.
(d) The Reporting Parties do not know of any other person who has
the right to receive or the power to direct the receipt of
dividends from, or the proceeds from the sale of, the shares
of Common Stock reported in this Amendment as beneficially
owned by the Reporting Parties.
(e) N/A
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
The Reporting Parties and the Listed Directors are parties to the
following contracts, arrangements, understandings or relationships (legal or
otherwise) with respect to any securities of the Company:
(a) Pursuant to Rule 13d-1(k) promulgated under the Exchange Act,
the Reporting Parties have entered into an agreement, attached
hereto, with respect to the joint filing of this Amendment.
This joint filing agreement is incorporated by reference to
Exhibit 99.1 hereto.
(b) The 2003 Optima Warrant to purchase 1,650,114 shares of Common
Stock issued to Optima on August 28, 2003 pursuant to the 2003
Subscription Agreement is described in the first paragraph of
Item 3 of this Amendment, which description is incorporated
herein by reference. The summary of the 2003 Optima Warrant in
this Amendment is qualified in its entirety by reference to
the 2003 Optima Warrant, which is incorporated by reference to
Exhibit 99.2 hereto.
SCHEDULE 13D
CUSIP NO. 44860M108 Page 11 of 14 Pages
(c) The 2003 Pillar Warrant to purchase 587,709 shares of Common
Stock issued to Pillar on August 28, 2003 pursuant to the 2003
Engagement Letter is described in the first paragraph of Item
3 of this Amendment, which description is incorporated herein
by reference. The summary of the 2003 Pillar Warrant in this
Amendment is qualified in its entirety by reference to the
2003 Pillar Warrant, which is incorporated by reference to
Exhibit 99.3 hereto.
(d) In connection with its purchase of shares of Common Stock and
the 2004 Optima Warrants, Optima entered into the 2004
Subscription Agreement. The 2004 Subscription Agreement
provides for the purchase by Optima, and the sale by the
Company, of securities in the 2004 Private Financing. This
transaction is described in the second paragraph of Item 3 of
this Amendment, which description is incorporated herein by
reference. The summary of the 2004 Subscription Agreement in
this Amendment is qualified in its entirety by reference to
the 2004 Subscription Agreement, which is attached as Exhibit
99.4 hereto.
(e) The 2004 Optima Warrant to purchase 553,620 shares of Common
Stock issued to Optima on August 27, 2004 pursuant to the 2004
Subscription Agreement is described in the second paragraph of
Item 3 of this Amendment, which description is incorporated
herein by reference. The summary of the 2004 Optima Warrant in
this Amendment is qualified in its entirety by reference to
the form of 2004 Optima Warrant, which is attached as Exhibit
99.5 hereto.
(f) Pursuant to the 2004 Engagement Letter referenced in Item 3 of
this Amendment, the Company engaged Pillar as a non-exclusive
financial advisor to the Company in connection with the
private placement of securities of the Company outside the
United States. In consideration for these services, the
Company agreed to pay Pillar cash fees and warrants to
purchase shares of Common Stock as placement fees. The 2004
Engagement Letter may be terminated at any time upon written
notice by the Company or by Pillar. The summary of the 2004
Engagement Letter in this Amendment is qualified in its
entirety by reference to the 2004 Engagement Letter, which is
attached as Exhibit 99.6 hereto.
(g) The 2004 Pillar Warrant to purchase 432,520 shares of Common
Stock issued to Pillar on August 27, 2004 pursuant to the 2004
Engagement Letter is described in the third paragraph of Item
3 of this Amendment, which description is incorporated herein
by reference. The summary of the 2004 Pillar Warrant in this
Amendment is qualified in its entirety by reference to the
form of 2004 Pillar Warrant, which is attached as Exhibit 99.7
hereto.
SCHEDULE 13D
CUSIP NO. 44860M108 Page 12 of 14 Pages
(h) In connection with the 2004 Private Financing, the Company
entered into a registration rights agreement dated as of
August 27, 2004 with the investors in the 2004 Private
Financing and Pillar (the "2004 Registration Rights
Agreement") under which the Company agreed to register the
resale of the shares of Common Stock issued in the 2004
Private Financing, the shares of Common Stock issuable upon
exercise of the warrants issued in the 2004 Private Financing
and the shares of Common Stock issuable upon exercise of the
warrants issued to Pillar in connection with the 2004 Private
Financing. The summary of the 2004 Registration Rights
Agreement in this Amendment is qualified in its entirety by
reference to the 2004 Registration Rights Agreement, which is
attached as Exhibit 99.8 hereto.
(i) Optima is subject to the Memorandum and Articles of
Association of Optima, as amended (the "Memorandum and
Articles"), which were adopted by Optima on August 19, 2004,
and the Management Agreement dated August 20, 2003 between
Optima and Pillar (the "Management Agreement"). The Memorandum
and Articles establish the rights, preferences and privileges
of the different classes of capital in Optima, including the
management shares held by Pillar. These rights, preferences
and privileges include voting rights, redemption rights and
rights upon the windup of Optima. The Management Agreement
provides that Pillar will serve as the Manager and Investment
Advisor of Optima and will administer Optima's day-to-day
activities. Optima has agreed to pay Pillar's fees and
expenses for these services in shares of Common Stock. Such
payment of shares of Common Stock will generally occur upon
the exercise by shareholders of Optima of their redemption
rights. The summary of the Memorandum and Articles and the
Management Agreement in this Amendment is qualified in its
entirety by reference to the Memorandum and Articles and the
Management Letter, which are attached as Exhibit 99.9 and
incorporated by reference to Exhibit 99.10, respectively.
Except as described above, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) among the Reporting Persons
or, to the knowledge of the Reporting Parties, the Listed Directors, or between
such persons and any other person with respect to any securities of the Company
Item 7. Material to be Filed as Exhibits.
The following documents are filed as exhibits to this statement:
SCHEDULE 13D
CUSIP NO. 44860M108 Page 13 of 14 Pages
99.1 Joint Filing Agreement, dated as of September 8, 2003, by and
among the Reporting Parties (incorporated by reference to
Exhibit 1 to the filing on Schedule 13D by the Reporting
Parties dated September 8, 2003).
99.2 Warrant to purchase 1,650,114 shares of Common Stock issued to
Optima on August 28, 2003 (incorporated by reference to
Exhibit 3 to the filing on Schedule 13D by the Reporting
Parties dated September 8, 2003).
99.3 Warrant to purchase 587,709 shares of Common Stock issued to
Pillar on August 28, 2003 (incorporated by reference to
Exhibit 5 to the filing on Schedule 13D by the Reporting
Parties dated September 8, 2003).
99.4 Subscription Agreement, dated as of August 27, 2004, by and
between the Company and Optima (filed herewith).
99.5 Form of Warrant to purchase 553,620 shares of Common Stock
issued to Optima on August 27, 2004 (filed herewith).
99.6 Engagement letter dated as of August 27, 2004, by and between
the Company and Pillar (filed herewith).
99.7 Form of Warrant to purchase 432,520 shares of Common Stock
issued to Pillar on August 27, 2004 (filed herewith).
99.8 Registration Rights Agreement, dated as of August 27, 2004, by
and among the Company, the investors in the 2004 Private
Financing and Pillar (filed herewith).
99.9 Memorandum and Articles of Association of Optima, as amended,
adopted by Optima on August 19, 2004 (filed herewith).
99.10 Management Agreement, dated August 20, 2003, by and between
Optima and Pillar (incorporated by reference to Exhibit 8 to
the filing on Schedule 13D by the Reporting Parties dated
September 8, 2003).
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
October 8, 2004
By: /s/ Youseff El-Zein
Youssef El-Zein
Pillar Investment Limited
By: /s/ Youseff El-Zein
Youssef El-Zein
Director
Optima Life Sciences Limited
By: /s/ Bilal Sidani
Bilal Sidani
Director
SCHEDULE I
Set forth below is the name, position, present principal occupation and
business address of each of the directors Pillar and Optima.
- ----------------------------------------------------------------------------------------------------------------------
Pillar
- ----------------------------------------------------------------------------------------------------------------------
Name Position with Pillar Present Principal Business Address Citizenship
Occupation
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Youssef El-Zein Director Director of St. James's France
Pillar Investment Chambers, 64A
Limited Athol Street,
Douglas, Isle of
Man IM 1JE
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Bilal Sidani Director Director of St. James's France
Pillar Investment Chambers, 64A
Limited Athol Street,
Douglas, Isle of
Man IM 1JE
- ----------------------------------------------------------------------------------------------------------------------
Optima
- ----------------------------------------------------------------------------------------------------------------------
Name Position with Optima Present Principal Business Address Citizenship
Occupation
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Youssef El-Zein Director Director of St. James's France
Pillar Investment Chambers, 64A
Limited Athol Street,
Douglas, Isle of
Man IM 1JE
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Bilal Sidani Director Director of St. James's France
Pillar Investment Chambers, 64A
Limited Athol Street,
Douglas, Isle of
Man IM 1JE
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
David Burge Director Managing Director St. James's United Kingdom
of Caledonian Chambers, 64A
Trust (IOM) Limited, Athol Street,
a licensed Corporate Douglas, Isle of
Service Provider Man IM 1JE
under the laws of the
Isle of Man
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Exhibit 99.4
SUBSCRIPTION AGREEMENT
(Non-U.S. Investor)
Hybridon, Inc.
345 Vassar Street
Cambridge, MA 02139
Gentlemen:
1. Subscription. The undersigned (the "Purchaser"), intending to be
legally bound, hereby irrevocably agrees to purchase from Hybridon, Inc. (the
"Company") units of the Company (the "Units") for the total purchase price set
forth on the signature page hereto. Each Unit shall consist of 100 shares of the
Company's common stock, par value U.S. $.001 per share ("Common Stock"), and
warrants ("Warrants") to purchase 20 shares of Common Stock. Each Unit is being
offered at a price per Unit determined by multiplying 100 by the sum of:
(a) the highest of the following prices (the highest being
referred to as the "Market Price"):
(i) the volume weighted average of the closing sales prices
of the Common Stock on the American Stock Exchange for the five consecutive
trading days immediately preceding the date of the closing of the sale of Units
to the Purchaser under this Subscription Agreement (the "Closing Date"),
(ii) the volume weighted average of the closing sales prices
of the Common Stock on the American Stock Exchange for the 10 consecutive
trading days immediately preceding the Closing Date,
(iii) the volume weighted average of the closing sales prices
of the Common Stock on the American Stock Exchange for the 15 consecutive
trading days immediately preceding the Closing Date,
(iv) the volume weighted average of the closing sales prices
of the Common Stock on the American Stock Exchange for the 20 consecutive
trading days immediately preceding the Closing Date, and
(v) the closing sales price of the Common Stock on the
American Stock Exchange on the trading day immediately preceding the Closing
Date, and
(b) $0.025.
This subscription is submitted to you in accordance with and subject to
the terms and conditions described in this Subscription Agreement and the
Confidential Private Placement Memorandum of the Company dated August 25, 2004,
as amended or supplemented from time to time, including all attachments,
annexes, schedules and exhibits thereto (the "Memorandum"), relating to the
offering (the "Offering") by the Company of a minimum of $5,000,000 of Units
(the "Minimum Amount") and a maximum of $6,500,000 of Units (the "Maximum
Amount").
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The terms of the Offering are more completely described in the
Memorandum and such terms are incorporated herein in their entirety. Certain
capitalized terms used but not otherwise defined herein shall have the
respective meanings provided in the Memorandum.
2. Payment. The Purchaser agrees to make payment of the full amount of
the purchase price of the Units being subscribed for by wire transfer payment at
the time and in accordance with the directions specified by the Company. Such
funds will be held for the Purchaser's benefit, and will be returned promptly,
without interest, penalty, expense or deduction if (a) this Subscription
Agreement is not accepted by the Company, (b) the closing of the sale of Units
to the Purchaser under this Subscription Agreement (the "Closing") does not
occur within two weeks of the date of this Subscription Agreement as set forth
under the Purchaser's signature on the signature page hereto, or (c) the
Offering expires or is terminated pursuant to its terms or by the Company prior
to the Closing. Together with the check for, or wire transfer of, the full
purchase price, the Purchaser is delivering two completed and executed Omnibus
Signature Pages to this Subscription Agreement and the Registration Rights
Agreement.
3. Acceptance of Subscription. The Purchaser understands and agrees
that the Company may, in its sole discretion and for any reason whatsoever,
withdraw the Offering, accept or reject in whole or in part this or any other
subscription for Units or allot the Purchaser less than the number of Units that
the Purchaser desires to purchase. The Company shall have no liability
whatsoever to the Purchaser in the event that any of the foregoing shall occur.
The Company shall have no obligation hereunder until the Company shall execute
and deliver to the Purchaser an executed copy of this Subscription Agreement and
until the closing conditions provided in Section 4(b) have been fulfilled. If
(a) this Subscription Agreement is not accepted by the Company, (b) the Closing
does not occur within two weeks of the date of this Subscription Agreement as
set forth under the Purchaser's signature on the signature page hereto, or (c)
the Offering expires or is terminated pursuant to its terms or by the Company
prior to the Closing, this Subscription Agreement shall thereafter be of no
further force or effect.
4. Closing.
(a) The Closing of the sale of the Units to the Purchaser under
this Subscription Agreement shall occur as soon as practicable following the
acceptance by the Company of this Subscription Agreement and the fulfillment of
the conditions set forth in paragraph (b) below.
(b) The obligations of the Purchaser to purchase, and of the
Company to sell, the Units under this Subscription Agreement shall be subject to
the fulfillment of the following conditions:
(i) the Minimum Amount of Units shall have been sold or shall
concurrently be sold to all purchasers of Units in the Offering, including the
Units sold to the Purchaser under this Subscription Agreement;
(ii) each representation and warranty contained in Section 5
shall be true on and as of the Closing Date with the same effect as though such
representation and warranty had been made on and as of that date; and
(iii) the shares of Common Stock issued as part of the Units
sold under this Subscription Agreement and the shares of Common Stock issuable
upon exercise of the Warrants issued as part of the Units sold under this
Subscription Agreement shall have been
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approved for listing on the American Stock Exchange, subject only to notice of
issuance at the time of purchase.
(c) Following the Closing, the Company shall deliver to the
Purchaser, against payment to the Company at the Closing of the purchase price
therefor in accordance with Section 2, a certificate for the number of shares of
Common Stock issued as part of the Units sold under this Subscription Agreement
and executed Warrants to purchase the number of shares of Common Stock issued as
part of the Units sold under this Subscription Agreement.
(d) The Company and its agents may continue to offer and sell
Units and conduct additional closings for the sale of additional Units after the
Closing and until the expiration or termination of the Offering.
5. Representations and Warranties. The Purchaser hereby acknowledges,
represents, warrants and agrees as follows:
(a) The Purchaser understands that the offering and sale of the
Units is intended to be exempt from registration under the U.S. Securities Act
of 1933, as amended (the "Securities Act"), by virtue of Section 4(2) thereof
and the provisions of Regulation D promulgated thereunder, and outside the
United States in accordance with Regulation S under the Securities Act
("Regulation S"), based, in part, upon the representations, warranties and
agreements of the Purchaser contained in this Subscription Agreement;
(b) The Purchaser and the Purchaser's attorney, accountant,
purchaser representative and/or tax advisor, if any (collectively, the
"Advisors"), have received the Memorandum and all other documents requested by
the Purchaser and the Advisors, if any, have carefully reviewed them and
understand the information contained therein prior to the execution of this
Subscription Agreement;
(c) None of the U.S. Securities and Exchange Commission, any state
securities commission or any other regulatory authority (foreign or otherwise)
has approved the Units or any of the shares of Common Stock, the Warrants or the
shares of Common Stock issuable upon exercise of the Warrants, or passed upon or
endorsed the merits of the Offering or confirmed the accuracy or determined the
adequacy of the Memorandum. The Memorandum has not been reviewed by any U.S.
Federal, state or other regulatory authority (foreign or otherwise);
(d) The Purchaser and the Advisors, if any, have had a reasonable
opportunity to ask questions of and receive answers from a person or persons
acting on behalf of the Company concerning the Offering and the business,
financial condition, results of operations and prospects of the Company, and all
such questions have been answered to the full satisfaction of the Purchaser and
the Advisors, if any;
(e) In evaluating the suitability of an investment in the Company,
the Purchaser has not relied upon any representation or other information (oral
or written) other than as stated in the Memorandum;
(f) The Purchaser has taken no action which would give rise to any
claim by any person against the Company for brokerage commissions, finders' fees
or the like relating to this Subscription Agreement or the transactions
contemplated hereby;
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(g) The Purchaser, either alone or together with its Advisor(s),
if any, have such knowledge and experience in financial, tax, and business
matters, and, in particular, investments in securities, so as to enable them to
utilize the information made available to them in connection with the Offering
to evaluate the merits and risks of an investment in the Units and the Company
and to make an informed investment decision with respect thereto;
(h) The Purchaser is not relying on the Company, or any of its
agents or any of their respective employees or agents with respect to the legal,
tax, economic and related considerations of an investment in the Units, and the
Purchaser has relied on the advice of, or has consulted with, only his or its
own Advisors;
(i) The Purchaser is acquiring the Units solely for such
Purchaser's own account for investment and not with a view to resale or
distribution thereof, in whole or in part. Except for arrangements with
shareholders of the Purchaser as provided in the organizational documents of the
Purchaser, the Purchaser has no agreement or arrangement, formal or informal,
with any person to sell or transfer all or any part of the Units, the shares of
Common Stock, the Warrants or the shares of Common Stock issuable upon exercise
of the Warrants, and the Purchaser has no plans to enter into any such agreement
or arrangement;
(j) The purchase of Units represents high risk capital and the
Purchaser is able to afford an investment in a speculative venture having the
risks and objectives of the Company. The Purchaser must bear the substantial
economic risks of the investment in the Units indefinitely because none of the
securities included in the Units may be sold, hypothecated or otherwise disposed
of unless (i) such securities are subsequently registered under the Securities
Act, (ii) an exemption from such registration is available in a transaction not
subject to the registration requirements of the Securities Act or (iii) in
accordance with Regulation S. The Company has agreed that purchasers of the
Units will have, with respect to the shares of Common Stock and the shares of
Common Stock issuable upon exercise of the Warrants, the registration rights
described in the Registration Rights Agreement the form of which is included in
the subscription documents;
(k) The Purchaser has adequate means of providing for such
Purchaser's current financial needs and foreseeable contingencies and has no
need for liquidity of the investment in the Units for an indefinite period of
time;
(l) The Purchaser is aware that an investment in the Units
involves a number of very significant risks and has carefully read and
considered the matters set forth under the caption "Risks Related to this
Offering" and other risk factors of the Company that are referenced in the
Memorandum;
(m) The Purchaser is not a U.S. person (as defined in Securities
Act Rule 902(k)) and is not acquiring the Units, the shares of Common Stock, the
Warrant or the shares of Common Stock issuable upon exercise of the Warrant for
the account or benefit of any U.S. person.
(n) The Purchaser: (i) if a natural person, represents that the
Purchaser has reached the age of 21 and has full power and authority to execute
and deliver this Subscription Agreement and all other related agreements or
certificates and to carry out the provisions hereof and thereof; (ii) if a
corporation, partnership, or limited liability company or partnership, or
association, joint stock company, trust, unincorporated organization or other
entity, represents that such entity was not formed for the specific purpose of
acquiring the Units, such entity is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, the
consummation of the transactions contemplated hereby is authorized by, and will
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not result in a violation of any applicable law or its charter or other
organizational documents, such entity has full power and authority to execute
and deliver this Subscription Agreement and all other related agreements or
certificates and to carry out the provisions hereof and thereof and to purchase
and hold the securities constituting the Units, the execution and delivery of
this Subscription Agreement has been duly authorized by all necessary action,
this Subscription Agreement has been duly executed and delivered on behalf of
such entity and is a legal, valid and binding obligation of such entity; or
(iii) if executing this Subscription Agreement in a representative or fiduciary
capacity, represents that it has full power and authority to execute and deliver
this Subscription Agreement in such capacity and on behalf of the subscribing
individual, ward, partnership, trust, estate, corporation, or limited liability
company or partnership, or other entity for whom the Purchaser is executing this
Subscription Agreement, and such individual, partnership, ward, trust, estate,
corporation, or limited liability company or partnership, or other entity has
full right and power to perform pursuant to this Subscription Agreement and make
an investment in the Company, and represents that this Subscription Agreement
constitutes a legal, valid and binding obligation of such entity. The execution
and delivery of this Subscription Agreement will not violate or be in conflict
with any order, judgment, injunction, agreement or controlling document to which
the Purchaser is a party or by which it is bound;
(o) The Purchaser represents to the Company that any information
which the Purchaser has heretofore furnished or is furnishing herewith to the
Company is complete and accurate and may be relied upon by the Company in
determining the availability of an exemption from registration under U.S.
Federal securities laws and applicable laws of states and foreign jurisdictions
in connection with the offering of securities as described in the Memorandum.
The Purchaser further represents and warrants that it will notify and supply
corrective information to the Company immediately upon the occurrence of any
change therein occurring prior to the Company's issuance of the Units hereunder;
(p) Within five days after receipt of a request from the Company,
the Purchaser will provide such information and deliver such documents as may
reasonably be necessary to comply with any and all laws and ordinances to which
the Company is subject, including all information regarding the Purchaser that
the Company requests in connection with the registration statement to be filed
pursuant to the Registration Rights Agreement described in the Memorandum;
(q) No oral or written representations have been made, or oral or
written information furnished, to the Purchaser or the Advisors, if any, in
connection with the Offering which are in any way inconsistent with the
information contained in the Memorandum;
(r) NONE OF THE SHARES OF COMMON STOCK, THE WARRANTS TO PURCHASE
SHARES OF COMMON STOCK OR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THE WARRANTS OFFERED PURSUANT TO THE MEMORANDUM HAVE BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OR FOREIGN JURISDICTION AND ARE BEING OFFERED AND SOLD IN RELIANCE
ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE
SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT
BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE SECURITIES HAVE NOT BEEN
APPROVED OR DISAPPROVED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION, ANY
STATE SECURITIES COMMISSION OR ANY OTHER REGULATORY AUTHORITY (FOREIGN OR
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OTHERWISE), NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED
THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THE MEMORANDUM. ANY
REPRESENTATION TO THE CONTRARY IS UNLAWFUL;
(s) Each certificate representing shares of Common Stock issued
hereunder or upon exercise of the Warrants and each Warrant shall bear a legend
substantially in the following form:
"These shares have not been registered under the Securities Act of
1933. They may not be offered or transferred by sale, assignment,
pledge or otherwise unless (i) a registration statement for the shares
under the Securities Act of 1933 is in effect or (ii) the corporation
has received an opinion of counsel, which opinion is satisfactory to
the corporation, to the effect that such registration is not required
under the Securities Act of 1933 or (iii) such offer or transfer is
made in accordance with the provisions of Regulation S under the
Securities Act of 1933. Hedging transactions involving these shares may
not be conducted unless in compliance with the Securities Act of 1933."
(t) The foregoing representations and warranties are true as of
the date of this Subscription Agreement and shall be true as of the Closing
Date. If such representations and warranties shall not be true in any respect
prior to the Closing Date the Purchaser will give prompt written notice of such
fact to the Company.
6. Irrevocability; Binding Effect. The Purchaser hereby acknowledges
and agrees that the subscription hereunder is irrevocable by the Purchaser,
except as required by applicable law, and that this Subscription Agreement shall
survive the death or disability of the Purchaser and shall be binding upon and
inure to the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives, and permitted assigns. If the Purchaser is
more than one person, the obligations of the Purchaser hereunder shall be joint
and several and the agreements, representations, warranties, and acknowledgments
herein shall be deemed to be made by and be binding upon each such person and
such person's heirs, executors, administrators, successors, legal
representatives, and permitted assigns.
7. Modification. Except as expressly permitted herein, this
Subscription Agreement shall not be modified or waived except by an instrument
in writing signed by the party against whom any such modification or waiver is
sought.
8. Notices. Any notice or other communication required or permitted to
be given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested, or by a reputable overnight delivery service or shall
be delivered against receipt to the party to whom it is to be given (a) if to
the Company, at the address set forth above, or (b) if to the Purchaser, at the
address set forth on the signature page hereof (or, in either case, to such
other address as the party shall have furnished in writing in accordance with
the provisions of this Section 8). Any notice or other communication given by
certified mail shall be deemed given at the time of certification thereof and
any notice or other communication given by overnight delivery service shall be
deemed given two business days after deposit with the courier; provided,
however, that a notice changing a party's address shall be deemed given at the
time of receipt thereof.
9. Assignability. This Subscription Agreement and the rights, interests
and obligations hereunder are not transferable or assignable by the Purchaser.
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10. Applicable Law. This Subscription Agreement shall be governed by
and construed in accordance with the laws of the Commonwealth of Massachusetts
in the United States without reference to the principles thereof relating to the
conflict of laws.
11. Blue Sky Qualification. The purchase of Units under this
Subscription Agreement is expressly conditioned upon the exemption from
qualification of the offer and sale of the Units from applicable U.S. Federal
securities laws and the applicable laws of states and foreign jurisdictions. The
Company shall not be required to qualify as a foreign corporation or execute a
general consent to service of process in any jurisdiction and, should
qualification or execution of a general consent be necessary, the Company shall
be released from any and all obligations to maintain its offer, and may rescind
any sale contracted, in the jurisdiction.
12. Use of Pronouns. All pronouns and any variations thereof used
herein shall be deemed to refer to the masculine, feminine, neuter, singular or
plural as the identity of the person or persons referred to may require.
13. Confidentiality. The Purchaser acknowledges and agrees that any
information or data the Purchaser has acquired from or about the Company, not
otherwise properly in the public domain, was received in confidence. The
Purchaser agrees not to divulge, communicate or disclose, except as may be
required by law or for the performance of this Agreement, or use to the
detriment of the Company or for the benefit of any other person or persons, or
misuse in any way, any confidential information of the Company, including any
scientific, technical, trade or business secrets of the Company and any
scientific, technical, trade or business materials that are treated by the
Company as confidential or proprietary, including, but not limited to, ideas,
discoveries, inventions, developments and improvements belonging to the Company
and confidential information obtained by or given to the Company about or
belonging to third parties.
14. Miscellaneous.
(a) This Agreement, together with the Registration Rights
Agreement, constitute the entire agreement between the Purchaser and the Company
with respect to the subject matter hereof, except for any confidential
disclosure agreement between the Purchaser and the Company, and supersede all
prior oral or written agreements and understandings, if any, between the parties
relating to the subject matter hereof, except for any confidential disclosure
agreement between the Purchaser and the Company.
(b) The Purchaser's representations and warranties made in this
Agreement shall survive the execution and delivery hereof and delivery of the
shares of Common Stock and Warrants contained in the Units.
(c) Each of the parties hereto shall pay its own fees and expenses
(including the fees of any attorneys, accountants, appraisers or others engaged
by such party) in connection with this Agreement and the transactions
contemplated hereby whether or not the transactions contemplated hereby are
consummated.
(d) This Agreement may be executed in one or more counterparts
each of which shall be deemed an original, but all of which shall together
constitute one and the same instrument.
(e) Each provision of this Subscription Agreement shall be
considered separable and, if for any reason any provision or provisions hereof
are determined to be invalid or
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contrary to applicable law, such invalidity or illegality shall not impair the
operation of or affect the remaining portions of this Subscription Agreement.
(f) Paragraph titles are for descriptive purposes only and shall
not control or alter the meaning of this Subscription Agreement as set forth in
the text.
15. Omnibus Signature Page. This Subscription Agreement is intended to
be read and construed in conjunction with the Registration Rights Agreement
pertaining to the issuance by the Company of the shares of Common Stock and
Warrants to subscribers pursuant to the Memorandum. Accordingly, pursuant to the
terms and conditions of this Subscription Agreement and such related agreements
it is hereby agreed that the execution by Purchaser of this Subscription
Agreement, in the place set forth herein, shall constitute agreement to be bound
by the terms and conditions hereof and the terms and conditions of the
Registration Rights Agreement, with the same effect as if each of such separate
but related agreement were separately signed.
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HYBRIDON, INC.
OMNIBUS SIGNATURE PAGE TO
SUBSCRIPTION AGREEMENT AND REGISTRATION RIGHTS AGREEMENT
Subscriber hereby elects to subscribe under the Subscription Agreement for a
total of $1,600,000 of Units (NOTE: to be completed by subscriber) or such
lesser amount as shall purchase a whole number of Units and executes the
Subscription Agreement and the Registration Rights Agreement, agrees to be bound
by the terms and conditions thereof and authorizes this signature page to be
attached thereto.
Date (NOTE: To be completed by subscriber): 27 August, 2004
If the Purchaser is an INDIVIDUAL (if purchased as JOINT TENANTS, as TENANTS IN
COMMON, or as COMMUNITY PROPERTY, each owner must complete separate signature
page):
- --------------------------- --------------------------------------
Print Name Social Security Number (if applicable)
- --------------------------- --------------------------------------
Signature of Subscriber Address Line 1
- --------------------------- --------------------------------------
Date Address Line 2
If the Purchaser is a PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY or
TRUST:
Optima Life Sciences Limited
- ---------------------------------- --------------------------------------
Name of Partnership, Corporation, Federal Taxpayer Identification Number
Limited Liability Company or Trust (if applicable)
By: /s/ Youssef El Zein Isle of Man
- ------------------------- -----------
Name: Youssef El Zein Jurisdiction of Organization
Title: Director
August 27, 2004 St James's Chambers, 64A Athol Street
- ---------------------------------- --------------------------------------
Date Address Line 1
Isle of Man IM1 1JE
-------------------
Address Line 2
ACCEPTED AS OF THE 27TH DAY OF AUGUST, 2004:
HYBRIDON, INC.
By: /s/ Robert G. Andersen
-----------------------
Name: Robert G. Andersen
Title: CFO
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Exhibit 99.5
FORM OF WARRANT
THIS WARRANT AND THE WARRANT SHARES SHALL NOT BE SOLD OR
TRANSFERRED EXCEPT (A) IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE SECURITIES ACT OF 1933, (B) PURSUANT TO
REGISTRATION UNDER THE SECURITIES ACT OF 1933 OR (C) PURSUANT TO AN
AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933. HEDGING TRANSACTIONS INVOLVING THIS WARRANT AND THE
WARRANT SHARES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
THE SECURITIES ACT OF 1933.
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 5 OF THIS WARRANT
Warrant No. ____ Number of Shares: 553,620
(subject to adjustment)
Date of Issuance: August 27, 2004
HYBRIDON, INC.
Common Stock Purchase Warrant
(Void after August 27, 2009)
Hybridon, Inc., a Delaware corporation (the "Company"), for value
received, hereby certifies that Optima Life Sciences Limited, or his or its
registered assigns (the "Registered Holder"), is entitled, subject to the terms
and conditions set forth below, to purchase from the Company, at any time, or
from time to time, on or after August 27, 2004 and on or before 5:00 p.m.
(Boston time) on August 27, 2009, 553,620 shares of Common Stock, $0.001 par
value per share, of the Company ("Common Stock"), at a purchase price of $0.67
per share. The shares purchasable upon exercise of this Warrant, and the
purchase price per share, each as adjusted from time to time pursuant to the
provisions of this Warrant, are hereinafter referred to as the "Warrant Shares"
and the "Purchase Price," respectively.
1. Exercise.
(a) Exercise Process. The Registered Holder may, at its
option, elect to exercise this Warrant, in whole or in part and at any time, or
from time to time, by surrendering this Warrant, with the purchase form appended
hereto as Exhibit I duly executed by or on behalf of the Registered Holder, at
the principal office of the Company, or at such other office or agency as the
Company may designate, accompanied by payment in full, in lawful money of the
United States, of the Purchase Price payable in respect of the number of Warrant
Shares purchased upon such exercise.
(b) Exercise Date. Each exercise of this Warrant shall be
deemed to have been effected immediately prior to the close of business on the
day on which this Warrant shall have been surrendered to the Company as provided
in subsection 1(a) above (the "Exercise Date"). At such time, the person or
persons in whose name or names any certificates for Warrant Shares shall be
issuable upon such exercise as provided in subsection 1(c) below shall be deemed
to have become the holder or holders of record of the Warrant Shares represented
by such certificates.
(c) Issuance of Common Stock Certificates. As soon as
practicable after the exercise of this Warrant in whole or in part, and in any
event within 10 days thereafter, the Company, at its expense, will cause to be
issued in the name of, and delivered to, the Registered Holder, or as the
Registered Holder (upon payment by the Registered Holder of any applicable
transfer or withholding taxes) may direct:
(i) a certificate or certificates for the number of
full Warrant Shares to which the Registered Holder shall be entitled upon such
exercise plus, in lieu of any fractional share to which the Registered Holder
would otherwise be entitled, cash in an amount determined pursuant to Section 3
hereof; and
(ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of Warrant Shares equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of Warrant Shares for
which this Warrant was so exercised.
(d) Exercise by Non-U.S. Person. It shall be a condition to
the exercise of this Warrant by a Registered Holder that is not a U.S. Person
(as defined under the Securities Act of 1933, as amended (the "Securities Act"))
that such Registered Holder certify in writing to the Company that it is not a
U.S. Person and that this Warrant is not being exercised on behalf of a U.S.
Person.
2. Adjustments.
(a) Adjustment for Stock Splits and Combinations. If the
Company shall at any time, or from time to time after the date on which this
Warrant was first issued (or, if this Warrant was issued upon partial exercise
of, or in replacement of, another warrant of like tenor, then the date on which
such original warrant was first issued) (either such date being referred to as
the "Original Issue Date") effect a subdivision of the outstanding Common Stock,
the Purchase Price then in effect immediately before that subdivision shall be
proportionately decreased. If the Company shall at any time, or from time to
time, after the Original Issue Date combine the outstanding shares of Common
Stock, the Purchase Price then in effect immediately before the combination
shall be proportionately increased. Any adjustment under this paragraph shall
become effective at the close of business on the date the subdivision or
combination becomes effective.
(b) Adjustment for Certain Dividends and Distributions. In the
event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or
-2-
fix a record date for the determination of holders of Common Stock entitled to
receive, a dividend or other distribution payable in additional shares of Common
Stock, then and in each such event the Purchase Price then in effect immediately
before such event shall be decreased as of the time of such issuance or, in the
event such a record date shall have been fixed, as of the close of business on
such record date, by multiplying the Purchase Price then in effect by a
fraction:
(i) the numerator of which shall be the total number
of shares of Common Stock issued and outstanding immediately prior to the time
of such issuance or the close of business on such record date, and
(ii) the denominator of which shall be the total
number of shares of Common Stock issued and outstanding immediately prior to the
time of such issuance or the close of business on such record date plus the
number of shares of Common Stock issuable in payment of such dividend or
distribution;
provided, however, that if such record date shall have been fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Purchase Price shall be recomputed accordingly as of the
close of business on such record date and thereafter the Purchase Price shall be
adjusted pursuant to this paragraph as of the time of actual payment of such
dividends or distributions.
(c) Adjustment in Number of Warrant Shares. When any
adjustment is required to be made in the Purchase Price pursuant to subsections
2(a) or 2(b) above, the number of Warrant Shares purchasable upon the exercise
of this Warrant shall be changed to the number determined by dividing (i) an
amount equal to the number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Purchase Price in effect
immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment.
(d) Adjustments for Other Dividends and Distributions. In the
event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or fix a record date for the determination of holders
of Common Stock entitled to receive, a dividend or other distribution payable in
securities of the Company (other than shares of Common Stock) or in cash or
other property (other than regular cash dividends paid out of earnings or earned
surplus, determined in accordance with generally accepted accounting
principles), then and in each such event provision shall be made so that the
Registered Holder shall receive upon exercise hereof, in addition to the number
of shares of Common Stock issuable hereunder, the kind and amount of securities
of the Company, cash or other property which the Registered Holder would have
been entitled to receive had this Warrant been exercised on the date of such
event and had the Registered Holder thereafter, during the period from the date
of such event to and including the Exercise Date, retained any such securities
receivable during such period, giving application to all adjustments called for
during such period under this Section 2 with respect to the rights of the
Registered Holder.
(e) Adjustment for Reorganization. If there shall occur any
reorganization, recapitalization, reclassification, consolidation or merger
involving the Company in which the
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Common Stock is converted into or exchanged for securities, cash or other
property (other than a transaction covered by subsections 2(a), 2(b) or 2(d))
(collectively, a "Reorganization"), then, following such Reorganization, the
Registered Holder shall receive upon exercise hereof the kind and amount of
securities, cash or other property which the Registered Holder would have been
entitled to receive pursuant to such Reorganization if such exercise had taken
place immediately prior to such Reorganization. In any such case, appropriate
adjustment (as determined in good faith by the Board of Directors of the Company
(the "Board")) shall be made in the application of the provisions set forth
herein with respect to the rights and interests thereafter of the Registered
Holder, to the end that the provisions set forth in this Section 2 (including
provisions with respect to changes in and other adjustments of the Purchase
Price) shall thereafter be applicable, as nearly as reasonably may be, in
relation to any securities, cash or other property thereafter deliverable upon
the exercise of this Warrant.
(f) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Purchase Price pursuant to this Section 2, the
Company at its expense shall, as promptly as reasonably practicable but in any
event not later than 30 days thereafter, compute such adjustment or readjustment
in accordance with the terms hereof and furnish to the Registered Holder a
certificate setting forth such adjustment or readjustment (including the kind
and amount of securities, cash or other property for which this Warrant shall be
exercisable and the Purchase Price) and showing in detail the facts upon which
such adjustment or readjustment is based. The Company shall, as promptly as
reasonably practicable after the written request at any time of the Registered
Holder (but in any event not later than 30 days thereafter), furnish or cause to
be furnished to the Registered Holder a certificate setting forth (i) the
Purchase Price then in effect and (ii) the number of shares of Common Stock and
the amount, if any, of other securities, cash or property which then would be
received upon the exercise of this Warrant.
3. Fractional Shares. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall pay the value
thereof to the Registered Holder in cash on the basis of the Fair Market Value
per share of Common Stock. The "Fair Market Value" per share of Common Stock
shall be determined as follows:
(a) If the Common Stock is listed on a national securities
exchange, the Nasdaq National Market, the Nasdaq SmallCap Market, the OTC
Bulletin Board or another nationally recognized trading system as of the
Exercise Date, the Fair Market Value per share of Common Stock shall be deemed
to be the average of the high and low reported sale prices per share of Common
Stock thereon for the five consecutive trading day period immediately preceding
the Exercise Date; provided that if the Common Stock is not so listed during
such period, the Fair Market Value per share of Common Stock shall be determined
pursuant to clause 3(b).
(b) If the Common Stock is not listed on a national securities
exchange, the Nasdaq National Market, the Nasdaq SmallCap Market, the OTC
Bulletin Board or another nationally recognized trading system as of the
Exercise Date, the Fair Market Value per share of Common Stock shall be deemed
to be the amount most recently determined by the Board or an authorized
committee of the Board to represent the fair market value per share of the
Common Stock (including without limitation a determination for purposes of
granting Common Stock
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options or issuing Common Stock under any plan, agreement or arrangement with
employees of the Company).
4. Redemption of Warrants.
(a) Subject to the terms of this Section 4, the Company shall
have the right to redeem this Warrant for a redemption price (the "Redemption
Price") equal to the result obtained by multiplying (i) $0.01 by (ii) the number
of Warrant Shares that the Registered Holder is entitled to purchase upon
exercise of this Warrant immediately prior to the termination of this Warrant
under Section 4(d) below (such Redemption Price being subject to adjustment for
stock splits, stock dividends, combinations, recapitalizations,
reclassifications, and similar transactions affecting the Common Stock).
(b) The Company shall exercise this redemption right by
providing at least 30 days' prior written notice to the Registered Holder of
such redemption (the "Redemption Notice"). Such Redemption Notice shall be
provided to the Registered Holder in accordance with Section 10 of this Warrant.
The Redemption Notice shall specify the time, manner and place of redemption,
including without limitation the date on which this Warrant shall be redeemed
(the "Redemption Date") and the Redemption Price payable to the Registered
Holder (assuming that this Warrant is not exercised on or prior to the
Redemption Date).
(c) Notwithstanding the foregoing, the Company may not redeem
this Warrant or provide the Redemption Notice to the Registered Holder unless
the closing sales price of the Common Stock on each day of a 20 consecutive
trading day period ending within 30 days prior to the date the Company provides
the Redemption Notice to the Registered Holder is greater than or equal to $1.34
(subject to adjustment for stock splits, stock dividends, combinations,
recapitalizations, reclassifications, and similar transactions affecting the
Common Stock); provided, however, that the Company may not redeem this Warrant
or provide the Redemption Notice on or before February 27, 2005.
(d) This Warrant shall cease to be exercisable and shall be
terminated and of no further force or effect effective at 5:00 p.m. (Boston
Time) on the Redemption Date. If the Registered Holder does not exercise this
Warrant on or prior to the Redemption Date, the Registered Holder shall
surrender this Warrant to the Company on the Redemption Date for cancellation.
From and after the Redemption Date, the Registered Holder's sole right hereunder
shall be to receive the Redemption Price, without interest, upon presentation
and surrender of this Warrant for cancellation.
5. Transfers, etc.
(a) Neither this Warrant nor the Warrant Shares shall be sold
or transferred unless either (i) they first shall have been registered under the
Securities Act, or (ii) the Company first shall have been furnished with an
opinion of legal counsel, reasonably satisfactory to the Company, to the effect
that such sale or transfer is exempt from the registration requirements of the
Securities Act. Notwithstanding the foregoing, no registration or opinion of
counsel shall be required for a transfer made in accordance with Rule 144 under
the Securities Act.
-5-
(b) Each certificate representing Warrant Shares shall bear a
legend substantially in the following form:
"The securities represented by this certificate have
not been registered under the Securities Act of 1933,
as amended, and may not be offered, sold or otherwise
transferred, pledged or hypothecated unless and until
such securities are registered under such Act or an
opinion of counsel satisfactory to the Company is
obtained to the effect that such registration is not
required."
The foregoing legend shall be removed from the certificates representing any
Warrant Shares, at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Securities Act.
(c) In the case of a Registered Holder that is a non-U.S.
Person:
(i) THIS WARRANT AND THE WARRANT SHARES HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND THIS WARRANT MAY NOT BE
EXERCISED BY OR ON BEHALF OF A U.S. PERSON UNLESS REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
(ii) This Warrant and the Warrant Shares shall not be
sold or transferred except (A) in accordance with the provisions of Regulation S
under the Securities Act, (B) pursuant to registration under the Securities Act
or (C) pursuant to an available exemption from registration under the Securities
Act. Hedging transactions involving this Warrant and the Warrant Shares may not
be conducted unless in compliance with the Securities Act.
(iii) Notwithstanding Section 5(b) to the contrary,
each certificate representing Warrant Shares issued to a Registered Holder that
is a non-U.S. Person shall bear a legend substantially in the following form:
"These shares have not been registered under the Securities Act of
1933. They may not be offered or transferred by sale, assignment,
pledge or otherwise unless (i) a registration statement for the shares
under the Securities Act of 1933 is in effect or (ii) the corporation
has received an opinion of counsel, which opinion is satisfactory to
the corporation, to the effect that such registration is not required
under the Securities Act of 1933 or (iii) such offer or transfer is
made in accordance with the provisions of Regulation S under the
Securities Act of 1933. Hedging transactions involving these shares may
not be conducted unless in compliance with the Securities Act of 1933."
(d) The Company will maintain a register containing the name
and address of the Registered Holder of this Warrant. The Registered Holder may
change its address as shown on the warrant register by written notice to the
Company requesting such change.
-6-
(e) Notwithstanding Section 5(a) above, a Registered Holder
which is an entity may transfer this Warrant, in whole, to a wholly owned
subsidiary of such entity, a Registered Holder which is a partnership may
transfer this Warrant, in whole, to a partner of such partnership or a retired
partner of such partnership or to the estate of any such partner or retired
partner, a Registered Holder which is a limited liability company may transfer
this Warrant, in whole, to a member of such limited liability company or a
retired member or to the estate of any such member or retired member and a
Registered Holder who is an individual may transfer this Warrant, in whole, to
such individual's spouse, children, parents, siblings, grandchildren or any
trust established exclusively for the benefit of one or more of the foregoing
individuals, or by will or the laws of descent and distribution (in each case, a
"Permitted Transferee"). This Warrant and all rights hereunder are transferable
to a Permitted Transferee, in whole, upon surrender of this Warrant with a
properly executed assignment (in the form of Exhibit II hereto) at the principal
office of the Company (or, if another office or agency has been designated by
the Company for such purpose, then at such other office or agency).
6. No Impairment. The Company will not, by amendment of its charter or
through any reorganization, transfer of assets, consolidation, merger,
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 Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the Registered Holder against impairment.
7. Notices of Record Date, etc. In the event:
(a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the Common Stock of the Company, any consolidation or merger
of the Company with or into another corporation (other than a consolidation or
merger in which the Company is the surviving entity and its Common Stock is not
converted into or exchanged for any other securities or property), or any
transfer of all or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company,
then, and in each such case, the Company will send or cause to be sent to the
Registered Holder a notice specifying, as the case may be, (i) the record date
for such dividend, distribution or right, and the amount and character of such
dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such other stock or
securities at the time deliverable upon the exercise of this Warrant) shall be
entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
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reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up. Such notice shall be sent at least 10 days prior to
the record date or effective date for the event specified in such notice.
8. Reservation of Stock. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such number of Warrant Shares and other securities, cash and/or property, as
from time to time shall be issuable upon the exercise of this Warrant.
9. Exchange or Replacement of Warrants.
(a) Upon the surrender by the Registered Holder, properly
endorsed, to the Company at the principal office of the Company, the Company
will, subject to the provisions of Section 5 hereof, issue and deliver to or
upon the order of the Registered Holder, at the Company's expense, a new Warrant
or Warrants of like tenor, in the name of the Registered Holder or as the
Registered Holder (upon payment by the Registered Holder of any applicable
transfer taxes) may direct, calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock (or other securities, cash
and/or property) then issuable upon exercise of this Warrant.
(b) Upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and (in
the case of loss, theft or destruction) upon delivery of an indemnity agreement
(with surety if reasonably required) in an amount reasonably satisfactory to the
Company, or (in the case of mutilation) upon surrender and cancellation of this
Warrant, the Company will issue, in lieu thereof, a new Warrant of like tenor.
10. Notices. All notices and other communications from the Company to
the Registered Holder in connection herewith shall be mailed by certified or
registered mail, postage prepaid, or sent via a reputable overnight courier
service to the address last furnished to the Company in writing by the
Registered Holder. All notices and other communications from the Registered
Holder to the Company in connection herewith shall be mailed by certified or
registered mail, postage prepaid, or sent via a reputable overnight courier
service to the Company at its principal office set forth below. If the Company
should at any time change the location of its principal office to a place other
than as set forth below, it shall give prompt written notice to the Registered
Holder and thereafter all references in this Warrant to the location of its
principal office at the particular time shall be as so specified in such notice.
All such notices and communications shall be deemed delivered (i) two business
days after being sent by certified or registered mail, return receipt requested,
postage prepaid, or (ii) two business days after being sent via a reputable
overnight courier service.
11. No Rights as Stockholder. Until the exercise of this Warrant, the
Registered Holder shall not have or exercise any rights by virtue hereof as a
stockholder of the Company. Notwithstanding the foregoing, in the event (i) the
Company effects a split of the Common Stock by means of a stock dividend and the
Purchase Price of and the number of Warrant Shares are adjusted as of the date
of the distribution of the dividend (rather than as of the record date for such
dividend), and (ii) the Registered Holder exercises this Warrant between the
record date and the distribution date for such stock dividend, the Registered
Holder shall be entitled to receive,
-8-
on the distribution date, the stock dividend with respect to the shares of
Common Stock acquired upon such exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the record date for
such stock dividend.
12. Amendment or Waiver. Any term of this Warrant may be amended or
waived only by an instrument in writing signed by the party against which
enforcement of the change or waiver is sought. No waivers of any term, condition
or provision of this Warrant, in any one or more instances, shall be deemed to
be, or construed as, a further or continuing waiver of any such term, condition
or provision.
13. Section Headings. The section headings in this Warrant are for the
convenience of the parties and in no way alter, modify, amend, limit or restrict
the contractual obligations of the parties.
14. Governing Law. This Warrant will be governed by and construed in
accordance with the internal laws of the State of Delaware (without reference to
the conflicts of law provisions thereof).
15. Facsimile Signatures. This Warrant may be executed by facsimile
signature.
16. Acceptance by Registered Holder. By acquiring and accepting this
Warrant, the Registered Holder shall be deemed to have agreed and accepted the
terms and conditions of this Warrant.
EXECUTED as of the Date of Issuance indicated above.
HYBRIDON, INC.
By:________________________________
Title:_______________________________
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EXHIBIT I
PURCHASE FORM
To: Hybridon, Inc. Dated:____________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ______), hereby elects to purchase __________ shares of the Common
Stock of Hybridon, Inc. covered by such Warrant.
The undersigned herewith makes a payment of $___________ representing
the full purchase price for such shares at the price per share provided for in
such Warrant.
Signature: ______________________
Address: ______________________
______________________
-10-
EXHIBIT II
ASSIGNMENT FORM
FOR VALUE RECEIVED, ________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant (No. ____) with respect to all of the shares of Common Stock of
Hybridon, Inc. covered thereby set forth below, unto:
Name of Assignee Address No. of Shares
Dated:_____________________ Signature:________________________________
Signature Guaranteed:
By: _______________________
The signature should be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program) pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934.
-11-
Exhibit 99.6
Hybridon, Inc.
345 Vassar Street
Cambridge, Massachusetts 02139
August 27, 2004
Pillar Investments Limited
St. James' Chambers
Douglas
Isle of Man
Gentlemen:
This letter sets forth the terms and conditions of the engagement of
Pillar Investments Limited (the "Advisor") as a non-exclusive financial advisor
to Hybridon, Inc. (the "Company") in connection with the arrangement and
negotiation of a private placement of the Company's securities outside of the
United States (the "Transaction"). The Advisor, in its capacity as financial
advisor to the Company, has identified and will identify potential non-U.S.
investors and, subject to the Company's prior written approval, has contacted or
will contact such potential investors on behalf of the Company and has provided
and will provide such other services in connection with the Transaction as the
Company may from time to time reasonably request.
The Advisor has not contacted or initiated and shall not contact or
initiate any discussions with any party or prospective investor without first
identifying such party or prospective investor to the Company and obtaining the
Company's prior written approval to make such contact or initiate such
discussions (such parties and prospective investors that are approved by the
Company are referred to herein as the "Approved Investors"). The Advisor shall
not have authority under this letter to bind the Company in any way to any
party, and nothing contained in this letter shall require the Company to accept
the terms of any proposal or undertake any other action that would result in the
receipt by the Advisor of a fee hereunder.
The Advisor represents, warrants and covenants to the Company that:
(a) It has not offered, offered to sell or sold and shall not
offer, offer to sell or sell any securities of the Company on the basis
of any written communications or documents relating to the Company or
its business other than written materials furnished by the Company or
previously approved by the Company in writing, including without
limitation the Company's filings under the Securities Exchange Act of
1934, as amended (the "Offering Materials"). No communications (whether
oral or written) or documents relating to the Company or its business
made or delivered by the Advisor have been or shall be inconsistent
with the Offering Materials.
(b) It has not offered, offered to sell or sold and shall not
offer, offer to sell or sell any securities of the Company to any
investor in the United States or to any United States person outside
the United States.
(c) It has not engaged and shall not engage in any form of
general solicitation or general advertising which is prohibited by
Regulation D ("Regulation D") promulgated under the Securities Act of
1933, as amended (the "Securities Act"), in connection with the
Transaction or any directed selling efforts in the United States (as
such term is defined in Regulation S ("Regulation S") promulgated under
the Securities Act). In addition, such Advisor has not taken and shall
not take any action that might reasonably be expected to jeopardize the
availability for the Transaction of the exemption from registration
provided by Regulation S or the qualification of securities of the
Company for offer and sale under any applicable foreign securities
laws.
(d) It shall make reasonable inquiry to determine that each
investor is acquiring the securities of the Company for his or its own
account for investment.
(e) In the performance of its services hereunder, it has
complied and shall comply with the U.S. securities laws and the
securities laws in effect in any jurisdiction in which securities of
the Company are offered by it and the rules, regulations and orders of
any securities administrator existing or adopted thereunder.
(f) It shall not receive, directly or indirectly, any
remuneration in respect of any issuance and sale by the Company of its
securities in the United States or to any U.S. person.
In the event a Transaction with Approved Investors is completed during
the term of this letter, the Company will (i) pay the Advisor a fee in an amount
equal to 7% of the Aggregate Value (as defined below) of the Transaction
received from Approved Investors less $6,000 and (ii) issue to the Advisor a
warrant or warrants (in the form issued to Approved Investors in the
Transaction, if applicable, and in any event including antidilution protection
for stock splits and other similar events and other customary provisions as
agreed by the Company and the Advisor; provided that the term of the warrant or
warrants shall not exceed five years) to purchase such number of shares of
common stock of the Company (the "Warrant Shares") as is equal to 10% of the
Issued Shares (as defined below) at an exercise price per share equal to the
exercise price of the warrants issued to Approved Investors in the Transaction,
if applicable.
For the purposes of this letter, (i) the term "Aggregate Value" shall
mean the total amount of cash and the fair market value of all other property
paid by Approved Investors to the Company in consideration for the securities of
the Company to be issued in the Transaction (excluding, however, any payment
made in connection with the exercise of any warrants issued to the investors in
the Transaction), and (ii) the term "Issued Shares" shall mean the total number
of shares of common stock of the Company issued to the Approved Investors, who
were introduced to the Company by the Advisor, in the Transaction (excluding any
shares issued upon exercise of any warrants issued to the investors in the
Transaction and excluding any shares issued to any affiliate of the Advisor or
Youssef El-Zein, including without limitation Optima Life Sciences Limited).
-2-
The Advisor recognizes that the Company is subject to the rules of the
American Stock Exchange, including Section 711 of the American Stock Exchange
Company Guide. Accordingly, the Advisor agrees that notwithstanding the
foregoing the Company shall have no obligation hereunder to pay any fees or
issue any Warrants to the Advisor that would not comply with the rules of the
American Stock Exchange or that would require the Company to obtain stockholder
approval. In the event of such a conflict, the Company and the Advisor agree to
negotiate in good faith new compensation terms for the Advisor.
In addition to any fees payable to the Advisor under the terms of this
letter, the Company agrees to reimburse the Advisor for its reasonable
out-of-pocket expenses incurred in connection with the Advisor's activities
under this letter, which shall not exceed $35,000, in the aggregate, without
the Company's prior approval.
The Company agrees to indemnify the Advisor and its affiliates,
directors, officers, employees, agents and controlling persons (each such person
being an "Indemnified Party") from and against any and all losses, claims,
damages and liabilities, joint or several, to which such Indemnified Party may
become subject under any applicable federal or state law, or otherwise, related
to or arising out of the engagement of the Advisor pursuant to, and the
performance by the Advisor of the services contemplated by, this letter and
will, subject to the limitation set forth below, reimburse any Indemnified Party
for all expenses (including reasonable counsel fees and expenses, whether
incurred in connection with third party claims or direct claims against the
Company) as they are incurred in connection with the investigation of,
preparation for or defense of any pending or threatened claim or any action or
proceeding arising therefrom, whether or not such Indemnified Party is a party.
The Company will not be liable under the foregoing indemnification provision to
the extent that any loss, claim, damage, liability or expense is found in a
final judgment by a court of competent jurisdiction to have resulted from an
Indemnified Party's breach of this letter, bad faith, willful misfeasance, gross
negligence or reckless disregard of its obligations or duties. No Indemnified
Party shall settle any claim for which indemnification may be sought by him or
it hereunder without the prior written consent of the Company. The Company's
obligations to indemnify pursuant hereto shall be limited to the Indemnified
Party's actual liabilities, losses, damages or expenses incurred and shall not
include any consequential damages or damages for loss of business or reputation.
The Company will have the right, at its option, to assume the defense
of any litigation or proceeding in respect of which indemnity may be sought
hereunder, including the employment of counsel reasonably satisfactory to the
Advisor (the Advisor hereby agrees that Wilmer Cutler Pickering Hale and Dorr
LLP is satisfactory to the Advisor) and the payment of the fees and expenses of
such counsel, in which event, except as provided below, the Company shall not be
liable for the fees and expenses of any other counsel retained by any
Indemnified Person in connection with such litigation or proceeding. In any such
litigation or proceeding the defense of which the Company shall have so assumed,
any Indemnified Person shall have the right to participate in such litigation or
proceeding and to retain its own counsel.
Upon receipt by an Indemnified Person of actual notice of a claim,
action or proceeding against such Indemnified Person in respect of which
indemnity may be sought hereunder, such Indemnified Person shall promptly notify
the Company with respect thereto. In addition, an
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Indemnified Person shall promptly notify the Company after any action is
commenced (by the way of service with a summons or other legal process giving
information as to the nature and basis of the claim) against such Indemnified
Person in respect of which indemnity may be sought hereunder. In any event,
failure to notify the Company shall not relieve the Company from any liability
which the Company may have on account of this indemnity or otherwise, except to
the extent the Company shall have been prejudiced by such failure.
In the course of its services, the Advisor has had and will have access
to Confidential Information (as defined below) concerning the Company. The
Advisor agrees that all Confidential Information has been and will be treated by
the Advisor as confidential in all respects. The term "Confidential Information"
shall mean all information, whether written or oral, which is disclosed by the
Company or its affiliates, agents or representatives to the Advisor or is
otherwise learned of by the Advisor in connection with its role as financial
advisor to the Company which information is not in the public domain, but shall
not include: (i) information which, prior to disclosure to the Advisor, was
already in the Advisor's possession and was not otherwise subject to an
obligation of confidentiality; (ii) information which is publicly disclosed
other than by the Advisor in violation of this letter; (iii) information which
is obtained by the Advisor from a third party that (x) the Advisor does not know
to have violated, or to have obtained such information in violation of, any
obligation to the Company or its affiliates with respect to such information,
and (y) does not require the Advisor to refrain from disclosing such
information; and (iv) information which is required to be disclosed by the
Advisor or its outside counsel under compulsion of law (whether by oral
question, interrogatory, subpoena, civil investigative demand or otherwise) or
by order of any court or governmental or regulatory body to whose supervisory
authority the Advisor is subject; provided that, in such circumstance, the
Advisor will give the Company prior written notice of such disclosure and
cooperate with the Company to minimize the scope of any such disclosure. Each
Advisor's obligation under this paragraph shall survive the expiration,
termination or completion of this letter or the Advisor's engagement hereunder.
The Advisor's engagement hereunder and this letter shall terminate on
the earlier of (i) December 31, 2004 or (ii) written notice of termination by
the Company to the Advisor or by the Advisor to the Company, it being understood
that the provisions relating to confidentiality and indemnification will survive
any such termination.
This letter shall be construed and interpreted in accordance with the
laws of the Commonwealth of Massachusetts. This letter constitutes the entire
agreement of the parties with respect to the subject matter hereof.
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If the foregoing is in accordance with your understanding, please
confirm acceptance by signing and returning to us the duplicate of this letter
attached herewith.
Sincerely,
HYBRIDON, INC.
By: /s/ Robert G. Andersen
-------------------------
Name: Robert G. Andersen
Title: CFO
Agreed and Accepted as of
the date set forth above by:
PILLAR INVESTMENTS LIMITED
By /s/ Youssef El-Zein
--------------------
Title: Director
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Exhibit 99.7
FORM OF WARRANT
THIS WARRANT AND THE WARRANT SHARES SHALL NOT BE SOLD OR
TRANSFERRED EXCEPT (A) IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE SECURITIES ACT OF 1933, (B) PURSUANT TO
REGISTRATION UNDER THE SECURITIES ACT OF 1933 OR (C) PURSUANT TO AN
AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933. HEDGING TRANSACTIONS INVOLVING THIS WARRANT AND THE
WARRANT SHARES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
THE SECURITIES ACT OF 1933.
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 5 OF THIS WARRANT
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Warrant No. ____ Number of Shares: 432,520
(subject to adjustment)
Date of Issuance: August 27, 2004
HYBRIDON, INC.
Common Stock Purchase Warrant
(Void after August 27, 2009)
Hybridon, Inc., a Delaware corporation (the "Company"), for value
received, hereby certifies that Pillar Investment Limited, or his or its
registered assigns (the "Registered Holder"), is entitled, subject to the terms
and conditions set forth below, to purchase from the Company, at any time, or
from time to time, on or after August 27, 2004 and on or before 5:00 p.m.
(Boston time) on August 27, 2009, 432,520 shares of Common Stock, $0.001 par
value per share, of the Company ("Common Stock"), at a purchase price of $0.67
per share. The shares purchasable upon exercise of this Warrant, and the
purchase price per share, each as adjusted from time to time pursuant to the
provisions of this Warrant, are hereinafter referred to as the "Warrant Shares"
and the "Purchase Price," respectively.
1. Exercise.
(a) Exercise Process. The Registered Holder may, at its
option, elect to exercise this Warrant, in whole or in part and at any time, or
from time to time, by surrendering this Warrant, with the purchase form appended
hereto as Exhibit I duly executed by or on behalf of the Registered Holder, at
the principal office of the Company, or at such other office or agency as the
Company may designate, accompanied by payment in full, in lawful money of the
United States, of the Purchase Price payable in respect of the number of Warrant
Shares purchased upon such exercise.
(b) Exercise Date. Each exercise of this Warrant shall be
deemed to have been effected immediately prior to the close of business on the
day on which this Warrant shall have been surrendered to the Company as provided
in subsection 1(a) above (the "Exercise Date"). At such time, the person or
persons in whose name or names any certificates for Warrant Shares shall be
issuable upon such exercise as provided in subsection 1(c) below shall be deemed
to have become the holder or holders of record of the Warrant Shares represented
by such certificates.
(c) Issuance of Common Stock Certificates. As soon as
practicable after the exercise of this Warrant in whole or in part, and in any
event within 10 days thereafter, the Company, at its expense, will cause to be
issued in the name of, and delivered to, the Registered Holder, or as the
Registered Holder (upon payment by the Registered Holder of any applicable
transfer or withholding taxes) may direct:
(i) a certificate or certificates for the number of
full Warrant Shares to which the Registered Holder shall be entitled upon such
exercise plus, in lieu of any fractional share to which the Registered Holder
would otherwise be entitled, cash in an amount determined pursuant to Section 3
hereof; and
(ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of Warrant Shares equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of Warrant Shares for
which this Warrant was so exercised.
(d) Exercise by Non-U.S. Person. It shall be a condition to
the exercise of this Warrant by a Registered Holder that is not a U.S. Person
(as defined under the Securities Act of 1933, as amended (the "Securities Act"))
that such Registered Holder certify in writing to the Company that it is not a
U.S. Person and that this Warrant is not being exercised on behalf of a U.S.
Person.
2. Adjustments.
(a) Adjustment for Stock Splits and Combinations. If the
Company shall at any time, or from time to time after the date on which this
Warrant was first issued (or, if this Warrant was issued upon partial exercise
of, or in replacement of, another warrant of like tenor, then the date on which
such original warrant was first issued) (either such date being referred to as
the "Original Issue Date") effect a subdivision of the outstanding Common Stock,
the Purchase Price then in effect immediately before that subdivision shall be
proportionately decreased. If the Company shall at any time, or from time to
time, after the Original Issue Date combine the outstanding shares of Common
Stock, the Purchase Price then in effect immediately before the combination
shall be proportionately increased. Any adjustment under this paragraph shall
become effective at the close of business on the date the subdivision or
combination becomes effective.
(b) Adjustment for Certain Dividends and Distributions. In the
event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or
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fix a record date for the determination of holders of Common Stock entitled to
receive, a dividend or other distribution payable in additional shares of Common
Stock, then and in each such event the Purchase Price then in effect immediately
before such event shall be decreased as of the time of such issuance or, in the
event such a record date shall have been fixed, as of the close of business on
such record date, by multiplying the Purchase Price then in effect by a
fraction:
(i) the numerator of which shall be the total number
of shares of Common Stock issued and outstanding immediately prior to the time
of such issuance or the close of business on such record date, and
(ii) the denominator of which shall be the total
number of shares of Common Stock issued and outstanding immediately prior to the
time of such issuance or the close of business on such record date plus the
number of shares of Common Stock issuable in payment of such dividend or
distribution;
provided, however, that if such record date shall have been fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Purchase Price shall be recomputed accordingly as of the
close of business on such record date and thereafter the Purchase Price shall be
adjusted pursuant to this paragraph as of the time of actual payment of such
dividends or distributions.
(c) Adjustment in Number of Warrant Shares. When any
adjustment is required to be made in the Purchase Price pursuant to subsections
2(a) or 2(b) above, the number of Warrant Shares purchasable upon the exercise
of this Warrant shall be changed to the number determined by dividing (i) an
amount equal to the number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Purchase Price in effect
immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment.
(d) Adjustments for Other Dividends and Distributions. In the
event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or fix a record date for the determination of holders
of Common Stock entitled to receive, a dividend or other distribution payable in
securities of the Company (other than shares of Common Stock) or in cash or
other property (other than regular cash dividends paid out of earnings or earned
surplus, determined in accordance with generally accepted accounting
principles), then and in each such event provision shall be made so that the
Registered Holder shall receive upon exercise hereof, in addition to the number
of shares of Common Stock issuable hereunder, the kind and amount of securities
of the Company, cash or other property which the Registered Holder would have
been entitled to receive had this Warrant been exercised on the date of such
event and had the Registered Holder thereafter, during the period from the date
of such event to and including the Exercise Date, retained any such securities
receivable during such period, giving application to all adjustments called for
during such period under this Section 2 with respect to the rights of the
Registered Holder.
(e) Adjustment for Reorganization. If there shall occur any
reorganization, recapitalization, reclassification, consolidation or merger
involving the Company in which the
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Common Stock is converted into or exchanged for securities, cash or other
property (other than a transaction covered by subsections 2(a), 2(b) or 2(d))
(collectively, a "Reorganization"), then, following such Reorganization, the
Registered Holder shall receive upon exercise hereof the kind and amount of
securities, cash or other property which the Registered Holder would have been
entitled to receive pursuant to such Reorganization if such exercise had taken
place immediately prior to such Reorganization. In any such case, appropriate
adjustment (as determined in good faith by the Board of Directors of the Company
(the "Board")) shall be made in the application of the provisions set forth
herein with respect to the rights and interests thereafter of the Registered
Holder, to the end that the provisions set forth in this Section 2 (including
provisions with respect to changes in and other adjustments of the Purchase
Price) shall thereafter be applicable, as nearly as reasonably may be, in
relation to any securities, cash or other property thereafter deliverable upon
the exercise of this Warrant.
(f) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Purchase Price pursuant to this Section 2, the
Company at its expense shall, as promptly as reasonably practicable but in any
event not later than 30 days thereafter, compute such adjustment or readjustment
in accordance with the terms hereof and furnish to the Registered Holder a
certificate setting forth such adjustment or readjustment (including the kind
and amount of securities, cash or other property for which this Warrant shall be
exercisable and the Purchase Price) and showing in detail the facts upon which
such adjustment or readjustment is based. The Company shall, as promptly as
reasonably practicable after the written request at any time of the Registered
Holder (but in any event not later than 30 days thereafter), furnish or cause to
be furnished to the Registered Holder a certificate setting forth (i) the
Purchase Price then in effect and (ii) the number of shares of Common Stock and
the amount, if any, of other securities, cash or property which then would be
received upon the exercise of this Warrant.
3. Fractional Shares. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall pay the value
thereof to the Registered Holder in cash on the basis of the Fair Market Value
per share of Common Stock. The "Fair Market Value" per share of Common Stock
shall be determined as follows:
(a) If the Common Stock is listed on a national securities
exchange, the Nasdaq National Market, the Nasdaq SmallCap Market, the OTC
Bulletin Board or another nationally recognized trading system as of the
Exercise Date, the Fair Market Value per share of Common Stock shall be deemed
to be the average of the high and low reported sale prices per share of Common
Stock thereon for the five consecutive trading day period immediately preceding
the Exercise Date; provided that if the Common Stock is not so listed during
such period, the Fair Market Value per share of Common Stock shall be determined
pursuant to clause 3(b).
(b) If the Common Stock is not listed on a national securities
exchange, the Nasdaq National Market, the Nasdaq SmallCap Market, the OTC
Bulletin Board or another nationally recognized trading system as of the
Exercise Date, the Fair Market Value per share of Common Stock shall be deemed
to be the amount most recently determined by the Board or an authorized
committee of the Board to represent the fair market value per share of the
Common Stock (including without limitation a determination for purposes of
granting Common Stock
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options or issuing Common Stock under any plan, agreement or arrangement with
employees of the Company).
4. Redemption of Warrants.
(a) Subject to the terms of this Section 4, the Company shall
have the right to redeem this Warrant for a redemption price (the "Redemption
Price") equal to the result obtained by multiplying (i) $0.01 by (ii) the number
of Warrant Shares that the Registered Holder is entitled to purchase upon
exercise of this Warrant immediately prior to the termination of this Warrant
under Section 4(d) below (such Redemption Price being subject to adjustment for
stock splits, stock dividends, combinations, recapitalizations,
reclassifications, and similar transactions affecting the Common Stock).
(b) The Company shall exercise this redemption right by
providing at least 30 days' prior written notice to the Registered Holder of
such redemption (the "Redemption Notice"). Such Redemption Notice shall be
provided to the Registered Holder in accordance with Section 10 of this Warrant.
The Redemption Notice shall specify the time, manner and place of redemption,
including without limitation the date on which this Warrant shall be redeemed
(the "Redemption Date") and the Redemption Price payable to the Registered
Holder (assuming that this Warrant is not exercised on or prior to the
Redemption Date).
(c) Notwithstanding the foregoing, the Company may not redeem
this Warrant or provide the Redemption Notice to the Registered Holder unless
the closing sales price of the Common Stock on each day of a 20 consecutive
trading day period ending within 30 days prior to the date the Company provides
the Redemption Notice to the Registered Holder is greater than or equal to $1.34
(subject to adjustment for stock splits, stock dividends, combinations,
recapitalizations, reclassifications, and similar transactions affecting the
Common Stock); provided, however, that the Company may not redeem this Warrant
or provide the Redemption Notice on or before February 27, 2005.
(d) This Warrant shall cease to be exercisable and shall be
terminated and of no further force or effect effective at 5:00 p.m. (Boston
Time) on the Redemption Date. If the Registered Holder does not exercise this
Warrant on or prior to the Redemption Date, the Registered Holder shall
surrender this Warrant to the Company on the Redemption Date for cancellation.
From and after the Redemption Date, the Registered Holder's sole right hereunder
shall be to receive the Redemption Price, without interest, upon presentation
and surrender of this Warrant for cancellation.
5. Transfers, etc.
(a) Neither this Warrant nor the Warrant Shares shall be sold
or transferred unless either (i) they first shall have been registered under the
Securities Act, or (ii) the Company first shall have been furnished with an
opinion of legal counsel, reasonably satisfactory to the Company, to the effect
that such sale or transfer is exempt from the registration requirements of the
Securities Act. Notwithstanding the foregoing, no registration or opinion of
counsel shall be required for a transfer made in accordance with Rule 144 under
the Securities Act.
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(b) Each certificate representing Warrant Shares shall bear a
legend substantially in the following form:
"The securities represented by this certificate have
not been registered under the Securities Act of 1933,
as amended, and may not be offered, sold or otherwise
transferred, pledged or hypothecated unless and until
such securities are registered under such Act or an
opinion of counsel satisfactory to the Company is
obtained to the effect that such registration is not
required."
The foregoing legend shall be removed from the certificates representing any
Warrant Shares, at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Securities Act.
(c) In the case of a Registered Holder that is a non-U.S.
Person:
(i) THIS WARRANT AND THE WARRANT SHARES HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND THIS WARRANT MAY NOT BE
EXERCISED BY OR ON BEHALF OF A U.S. PERSON UNLESS REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
(ii) This Warrant and the Warrant Shares shall not be
sold or transferred except (A) in accordance with the provisions of Regulation S
under the Securities Act, (B) pursuant to registration under the Securities Act
or (C) pursuant to an available exemption from registration under the Securities
Act. Hedging transactions involving this Warrant and the Warrant Shares may not
be conducted unless in compliance with the Securities Act.
(iii) Notwithstanding Section 5(b) to the contrary,
each certificate representing Warrant Shares issued to a Registered Holder that
is a non-U.S. Person shall bear a legend substantially in the following form:
"These shares have not been registered under the Securities Act of
1933. They may not be offered or transferred by sale, assignment,
pledge or otherwise unless (i) a registration statement for the shares
under the Securities Act of 1933 is in effect or (ii) the corporation
has received an opinion of counsel, which opinion is satisfactory to
the corporation, to the effect that such registration is not required
under the Securities Act of 1933 or (iii) such offer or transfer is
made in accordance with the provisions of Regulation S under the
Securities Act of 1933. Hedging transactions involving these shares may
not be conducted unless in compliance with the Securities Act of 1933."
(d) The Company will maintain a register containing the name
and address of the Registered Holder of this Warrant. The Registered Holder may
change its address as shown on the warrant register by written notice to the
Company requesting such change.
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(e) Notwithstanding Section 5(a) above, a Registered Holder
which is an entity may transfer this Warrant, in whole, to a wholly owned
subsidiary of such entity, a Registered Holder which is a partnership may
transfer this Warrant, in whole, to a partner of such partnership or a retired
partner of such partnership or to the estate of any such partner or retired
partner, a Registered Holder which is a limited liability company may transfer
this Warrant, in whole, to a member of such limited liability company or a
retired member or to the estate of any such member or retired member and a
Registered Holder who is an individual may transfer this Warrant, in whole, to
such individual's spouse, children, parents, siblings, grandchildren or any
trust established exclusively for the benefit of one or more of the foregoing
individuals, or by will or the laws of descent and distribution (in each case, a
"Permitted Transferee"). This Warrant and all rights hereunder are transferable
to a Permitted Transferee, in whole, upon surrender of this Warrant with a
properly executed assignment (in the form of Exhibit II hereto) at the principal
office of the Company (or, if another office or agency has been designated by
the Company for such purpose, then at such other office or agency).
6. No Impairment. The Company will not, by amendment of its charter or
through any reorganization, transfer of assets, consolidation, merger,
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 Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the Registered Holder against impairment.
7. Notices of Record Date, etc. In the event:
(a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the Common Stock of the Company, any consolidation or merger
of the Company with or into another corporation (other than a consolidation or
merger in which the Company is the surviving entity and its Common Stock is not
converted into or exchanged for any other securities or property), or any
transfer of all or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company,
then, and in each such case, the Company will send or cause to be sent to the
Registered Holder a notice specifying, as the case may be, (i) the record date
for such dividend, distribution or right, and the amount and character of such
dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such other stock or
securities at the time deliverable upon the exercise of this Warrant) shall be
entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
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reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up. Such notice shall be sent at least 10 days prior to
the record date or effective date for the event specified in such notice.
8. Reservation of Stock. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such number of Warrant Shares and other securities, cash and/or property, as
from time to time shall be issuable upon the exercise of this Warrant.
9. Exchange or Replacement of Warrants.
(a) Upon the surrender by the Registered Holder, properly
endorsed, to the Company at the principal office of the Company, the Company
will, subject to the provisions of Section 5 hereof, issue and deliver to or
upon the order of the Registered Holder, at the Company's expense, a new Warrant
or Warrants of like tenor, in the name of the Registered Holder or as the
Registered Holder (upon payment by the Registered Holder of any applicable
transfer taxes) may direct, calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock (or other securities, cash
and/or property) then issuable upon exercise of this Warrant.
(b) Upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and (in
the case of loss, theft or destruction) upon delivery of an indemnity agreement
(with surety if reasonably required) in an amount reasonably satisfactory to the
Company, or (in the case of mutilation) upon surrender and cancellation of this
Warrant, the Company will issue, in lieu thereof, a new Warrant of like tenor.
10. Notices. All notices and other communications from the Company to
the Registered Holder in connection herewith shall be mailed by certified or
registered mail, postage prepaid, or sent via a reputable overnight courier
service to the address last furnished to the Company in writing by the
Registered Holder. All notices and other communications from the Registered
Holder to the Company in connection herewith shall be mailed by certified or
registered mail, postage prepaid, or sent via a reputable overnight courier
service to the Company at its principal office set forth below. If the Company
should at any time change the location of its principal office to a place other
than as set forth below, it shall give prompt written notice to the Registered
Holder and thereafter all references in this Warrant to the location of its
principal office at the particular time shall be as so specified in such notice.
All such notices and communications shall be deemed delivered (i) two business
days after being sent by certified or registered mail, return receipt requested,
postage prepaid, or (ii) two business days after being sent via a reputable
overnight courier service.
11. No Rights as Stockholder. Until the exercise of this Warrant, the
Registered Holder shall not have or exercise any rights by virtue hereof as a
stockholder of the Company. Notwithstanding the foregoing, in the event (i) the
Company effects a split of the Common Stock by means of a stock dividend and the
Purchase Price of and the number of Warrant Shares are adjusted as of the date
of the distribution of the dividend (rather than as of the record date for such
dividend), and (ii) the Registered Holder exercises this Warrant between the
record date and the distribution date for such stock dividend, the Registered
Holder shall be entitled to receive,
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on the distribution date, the stock dividend with respect to the shares of
Common Stock acquired upon such exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the record date for
such stock dividend.
12. Amendment or Waiver. Any term of this Warrant may be amended or
waived only by an instrument in writing signed by the party against which
enforcement of the change or waiver is sought. No waivers of any term, condition
or provision of this Warrant, in any one or more instances, shall be deemed to
be, or construed as, a further or continuing waiver of any such term, condition
or provision.
13. Section Headings. The section headings in this Warrant are for the
convenience of the parties and in no way alter, modify, amend, limit or restrict
the contractual obligations of the parties.
14. Governing Law. This Warrant will be governed by and construed in
accordance with the internal laws of the State of Delaware (without reference to
the conflicts of law provisions thereof).
15. Facsimile Signatures. This Warrant may be executed by facsimile
signature.
16. Acceptance by Registered Holder. By acquiring and accepting this
Warrant, the Registered Holder shall be deemed to have agreed and accepted the
terms and conditions of this Warrant.
EXECUTED as of the Date of Issuance indicated above.
HYBRIDON, INC.
By:________________________________
Title:_______________________________
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EXHIBIT I
PURCHASE FORM
To: Hybridon, Inc. Dated:____________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ______), hereby elects to purchase __________ shares of the Common
Stock of Hybridon, Inc. covered by such Warrant.
The undersigned herewith makes a payment of $___________ representing
the full purchase price for such shares at the price per share provided for in
such Warrant.
Signature: ______________________
Address: ______________________
______________________
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EXHIBIT II
ASSIGNMENT FORM
FOR VALUE RECEIVED, ________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant (No. ____) with respect to all of the shares of Common Stock of
Hybridon, Inc. covered thereby set forth below, unto:
Name of Assignee Address No. of Shares
Dated:_____________________ Signature:________________________________
Signature Guaranteed:
By: _______________________
The signature should be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program) pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934.
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Exhibit 99.8
HYBRIDON, INC.
REGISTRATION RIGHTS AGREEMENT
dated as of August 27, 2004
HYBRIDON, INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is entered into
as of August 27, 2004 by and among Hybridon, Inc., a Delaware corporation (the
"Company"), the persons and entities listed on the Schedule of Purchasers
attached hereto as Exhibit A (the "Purchasers") and the entities listed on the
Schedule of Agents attached hereto as Exhibit B (the "Agents"). The Purchasers
and the Agents shall become parties to this Agreement by the execution and
delivery of counterpart signature pages hereto in a form reasonably satisfactory
to the Company.
WHEREAS, the Company is conducting an offering of Units (the "Unit
Offering"), with each Unit consisting of 100 shares of the Company's common
stock, $.001 par value per share ("Common Stock"), and warrants to purchase 20
shares of Common Stock (the "Purchaser Warrants"), as described in the
Confidential Private Placement Memorandum dated August 25, 2004;
WHEREAS, in connection with the Unit Offering, the Company has engaged
the Agents and has agreed to issue to the Agents warrants to purchase Common
Stock (the "Agent Warrants"); and
WHEREAS, to induce the Purchasers to purchase Units in the Unit
Offering and the Agents to assist the Company in the Unit Offering, the Company
has agreed to provide certain registration rights under the Securities Act (as
defined below) and applicable state securities laws;
NOW, THEREFORE, in consideration of the promises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and each
of the Purchasers and the Agents hereby agree as follows:
1. Certain Definitions. As used in this Agreement, the following terms
shall have the following meanings:
(a) "Business Day" means any day other than Saturday, Sunday or
any other day on which commercial banks in The City of New York or in Boston,
Massachusetts are required by law to remain closed.
(b) "Commission" means the Securities and Exchange Commission, or
any other federal agency at the time administering the Securities Act.
(c) "Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor federal statute, and the rules and regulations of the
Commission issued under such Act, as they each may, from time to time, be in
effect.
(d) "Indemnified Party" means a party entitled to indemnification
pursuant to Section 7.
1
(e) "Indemnifying Party" means a party obligated to provide
indemnification pursuant to Section 7.
(f) "Person" means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization or association and governmental or any department or agency
thereof.
(g) "Registrable Securities" means (i) the shares of Common Stock
issued as part of the Units issued pursuant to the Unit Offering, (ii) the
shares of Common Stock issued or issuable upon exercise of the Purchaser
Warrants and the Agent Warrants and (iii) any other shares of Common Stock
issued in respect of such shares (as a result of a stock split, stock dividend,
reclassification, recapitalization or other similar transaction affecting the
Common Stock); provided, however, that shares of Common Stock that are
Registrable Securities shall cease to be Registrable Securities upon the
earliest of (A) the date that such shares are eligible to be sold under Rule 144
of the Securities Act, (B) the date that such shares are sold (I) pursuant to a
registration statement, (II) to or through a broker, dealer or underwriter in a
public securities transaction and/or (III) in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act such
that all transfer restrictions and restrictive legends with respect thereto, if
any, are removed upon the consummation of such sale, or (C) any sale or transfer
to any Person which by virtue of Section 9 of this Agreement is not entitled to
the rights provided by this Agreement. Wherever reference is made in this
Agreement to a request or consent of holders of a certain percentage of
Registrable Securities, the determination of such percentage shall include
shares of Common Stock issuable upon exercise of the Purchaser Warrants and the
Agent Warrants even if such exercise has not been effected.
(h) "Registration Statement" means a registration statement of the
Company filed under the Securities Act and covering the Registrable Securities.
(i) "Rightsholders" means the Purchasers, the Agents and any
persons or entities to whom the rights granted under this Agreement are
transferred by any Purchaser, Agent or his or its successors or assigns pursuant
to Section 9 of this Agreement.
(j) "Securities Act" means the Securities Act of 1933, as amended,
or any successor federal statute, and the rules and regulations of the
Commission issued under such Act, as they each may, from time to time, be in
effect.
2. Registration
(a) The Company shall use its best efforts to prepare and file
with the Commission a Registration Statement covering the resale of all of the
Registrable Securities and such other shares of Common Stock as the Company may
be required to include pursuant to registration rights agreements with other
Persons within 60 days of the date hereof. The Company shall use its best
efforts to have the Registration Statement declared effective by the Commission
within 90 days after the date the Registration Statement is filed or as soon as
possible thereafter.
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(b) The Company shall use its best efforts to cause the
Registration Statement to remain effective until the earlier of (i) the first
anniversary of the date hereof and (ii) the date on which the Rightsholders do
not hold any Registrable Securities.
3. Registration Procedures.
(a) In connection with the effectiveness of the Registration
Statement, the Company shall furnish to each Rightsholder such reasonable
numbers of copies of the prospectus and such documents incident thereto,
including any amendment of or supplement to the prospectus, as a Rightsholder
from time to time may reasonably request in order to facilitate the disposition
of such Rightsholder's Registrable Securities under the Registration Statement
in conformity with the requirements of the Securities Act.
(b) The Company shall use its best efforts to register or qualify
the Registrable Securities covered by the Registration Statement under the
securities laws of such states of the United States as the Rightsholders may
reasonably request; provided, however, that the Company shall not be required in
connection with this paragraph (b) to qualify as a foreign corporation or
execute a general consent to service of process in any jurisdiction.
(c) If the Company has delivered preliminary or final prospectuses
to the Rightsholders and if after having done so the Company determines that the
prospectus and/or the Registration Statement needs to be amended or supplemented
to comply with the requirements of the Securities Act, the Company shall
promptly notify the Rightsholders and, if requested by the Company, the
Rightsholders shall immediately cease making offers or sales of shares under the
Registration Statement and shall return all prospectuses to the Company. The
Company shall as promptly as reasonably practicable prepare and file with the
Commission any required amendment or supplement and following such filing, and,
if applicable, the effectiveness of such filing, shall provide the Rightsholders
with revised or supplemented prospectuses. Following receipt of the revised or
supplemented prospectuses, the Rightsholders shall be free to resume making
offers and sales under the Registration Statement.
(d) The Company shall use its best efforts to cause all such
Registrable Securities registered pursuant to this Agreement to be listed on
each securities exchange on which similar securities issued by the Company are
then listed.
4. Limitations on Registration Rights.
(a) The Company may, by written notice to the Rightsholders, (i)
delay the filing of, or effectiveness of, the Registration Statement or (ii)
suspend the Registration Statement after effectiveness and require that the
Rightsholders immediately cease sales of shares pursuant to the Registration
Statement, in the event that the Company is engaged in any activity or
transaction or preparations or negotiations for any activity or transaction that
the Company desires to keep confidential for business reasons, if the Company
determines in good faith that the public disclosure requirements imposed on the
Company under the Securities Act in connection with the Registration Statement
would require disclosure of such activity, transaction, preparations or
negotiations.
3
(b) If the Company requires the Rightsholders to cease sales of
shares pursuant to paragraph (a) above, the Company shall, as promptly as
practicable following the termination of the circumstance which entitled the
Company to do so, take such actions as may be necessary to reinstate the
effectiveness of the Registration Statement and/or give written notice to all
Rightsholders authorizing them to resume sales pursuant to the Registration
Statement. If as a result thereof the prospectus included in the Registration
Statement has been amended to comply with the requirements of the Securities
Act, the Company shall enclose such revised prospectus with the notice to
Rightsholders given pursuant to this paragraph (b), and the Rightsholders shall
make no offers or sales of shares pursuant to the Registration Statement other
than by means of such revised prospectus.
(c) Notwithstanding the foregoing, the Company may not (i) delay
the filing of, or the effectiveness of, the Registration Statement or (ii)
suspend the Registration Statement, pursuant to paragraph (a) above on more than
two occasions during any 12-month period or for more than 60 days per such
occasion.
5. Obligations of the Rightsholders.
(a) The Company shall not be required to include any Registrable
Securities in the Registration Statement unless such Rightsholder shall have
furnished to the Company such information regarding itself, the Registrable
Securities held by it and the intended method of disposition of the Registrable
Securities held by it as shall be reasonably required by the Company to effect
the effectiveness of the Registration Statement and unless such Rightsholder
shall have executed such documents in connection with the Registration Statement
as the Company may reasonably request. Each Rightsholder shall promptly notify
the Company of any material change with respect to such information previously
provided to the Company by such Rightsholder, including without limitation
notice of the sale by the Rightsholder of any Registrable Securities.
(b) Each Rightsholder agrees to cooperate with the Company as
reasonably requested by the Company in connection with the preparation and
filing of the Registration Statement hereunder.
6. Expenses of Registration. The Company shall pay the expenses
incurred by it in complying with its obligations under this Agreement, including
all registration and filing fees, exchange listing fees, fees and expenses of
counsel for the Company, and fees and expenses of accountants for the Company,
but excluding (a) any brokerage fees, selling commissions or underwriting
discounts incurred by the Rightsholders in connection with sales under the
Registration Statement and (b) the fees and expenses of any counsel retained by
Rightsholders.
7. Indemnification and Contribution.
(a) In the event of any registration of any of the Registrable
Securities under the Securities Act pursuant to this Agreement, the Company will
indemnify and hold harmless each Rightsholder, each of its officers, directors
and partners, and each underwriter of such Registrable Securities, if any, and
each other person, if any, who controls such Rightsholder or underwriter within
the meaning of the Securities Act or the Exchange Act against any and all
4
losses, claims, damages or liabilities, joint or several, to which such
Rightsholder, underwriter or controlling person may become subject under the
Securities Act, the Exchange Act, state securities or Blue Sky laws or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, any preliminary prospectus or final prospectus contained in the
Registration Statement, or any amendment or supplement to such Registration
Statement or (ii) the omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and the Company will reimburse such Rightsholder, underwriter and
each such controlling person for any legal or any other expenses reasonably
incurred by such Rightsholder, underwriter or controlling person in connection
with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable in any such case
to the extent that any such loss, claim, damage, liability or action arises out
of or is based upon any untrue statement or omission made in such Registration
Statement, preliminary prospectus or final prospectus, or any such amendment or
supplement, in reliance upon and in conformity with information furnished to the
Company by or on behalf of such Rightsholder, underwriter or controlling person
and stated to be specifically for use in connection with the Registration
Statement; and provided further that the foregoing indemnity agreement is
subject to the condition that, insofar as it relates to any untrue statement,
alleged untrue statement, omission or alleged omission made in any Registration
Statement, prospectus or amendment or supplement that was eliminated, remedied
or cured by the Company, such indemnity agreement shall not inure to the benefit
of any Rightsholder from whom the Person asserting any loss, claim, damage or
liability purchased the Registerable Securities if a copy of the Registration
Statement, prospectus, amendment or supplement was provided by the Company to
the Rightsholder but was not given or sent to such Person by the Rightsholder
prior to written confirmation of such sale.
(b) Each Rightsholder, severally and not jointly, will indemnify
and hold harmless the Company, each of its directors and officers and each
underwriter (if any) and each person, if any, who controls the Company or any
such underwriter within the meaning of the Securities Act or the Exchange Act,
against any losses, claims, damages or liabilities, joint or several, to which
the Company, such directors and officers, underwriter or controlling person may
become subject under the Securities Act, Exchange Act, state securities or Blue
Sky laws or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, any preliminary prospectus or final prospectus contained
in the Registration Statement, or any amendment or supplement to the
Registration Statement, or (ii) any omission or alleged omission to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, if and to the extent (and only to the extent) that the
statement or omission was made in reliance upon and in conformity with written
information relating to such Rightsholder furnished to the Company by such
Rightsholder and stated to be specifically for use in connection with such
Registration Statement, prospectus, amendment or supplement; provided, however,
that the obligations of a Rightsholder hereunder shall be limited to an amount
equal to the net proceeds to such Rightsholder of Registrable Securities sold in
connection with such registration.
5
(c) Each Indemnified Party shall give notice to the Indemnifying
Party promptly after such Indemnified Party has actual knowledge of any claim as
to which indemnity may be sought, and shall permit the Indemnifying Party to
assume the defense of any such claim or any litigation resulting therefrom;
provided, that counsel for the Indemnifying Party, who shall conduct the defense
of such claim or litigation, shall be approved by the Indemnified Party (whose
approval shall not be unreasonably withheld, conditioned or delayed); and,
provided, further, that the failure of any Indemnified Party to give notice as
provided herein shall not relieve the Indemnifying Party of its obligations
under this Section 7 except to the extent that the Indemnifying Party is
adversely affected by such failure. The Indemnified Party may participate in
such defense at such party's expense; provided, however, that the Indemnifying
Party shall pay such expense if the Indemnified Party reasonably concludes based
upon written advice of its counsel that representation of such Indemnified Party
by the counsel retained by the Indemnifying Party would be inappropriate due to
actual or potential differing interests between the Indemnified Party and any
other party represented by such counsel in such proceeding; provided further
that in no event shall the Indemnifying Party be required to pay the expenses of
more than one law firm per jurisdiction as counsel for the Indemnified Party.
The Indemnifying Party also shall be responsible for the expenses of such
defense if the Indemnifying Party does not elect to assume such defense. No
Indemnifying Party, in the defense of any such claim or litigation shall, except
with the consent of each Indemnified Party, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect of such claim or litigation, and no
Indemnified Party shall consent to entry of any judgment or settle such claim or
litigation without the prior written consent of the Indemnifying Party, which
consent shall not be unreasonably withheld, conditioned or delayed.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 7 is due
in accordance with its terms but for any reason is held to be unavailable to an
Indemnified Party in respect to any losses, claims, damages and liabilities
referred to herein, then the Indemnifying Party shall, in lieu of indemnifying
such Indemnified Party, contribute to the amount paid or payable by such
Indemnified Party as a result of such losses, claims, damages or liabilities to
which such party may be subject in such proportion as is appropriate to reflect
the relative fault of the Company on the one hand and the Rightsholders on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company and the Rightsholders shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of material fact related to information supplied by the Company
or the Rightsholders and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Rightsholders agree that it would not be just and equitable
if contribution pursuant to this Section 7(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above. Notwithstanding the provisions
of this Section 7(d), (i) in no case shall any one Rightsholder be liable or
responsible for any amount in excess of the gross proceeds received by such
Rightsholder from the offering of Registrable Securities and (ii) the Company
shall be liable and responsible for any amount in excess of such proceeds;
provided, however, that no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such
6
fraudulent misrepresentation. Any party entitled to contribution will, promptly
after receipt of notice of commencement of any action, suit or proceeding
against such party in respect of which a claim for contribution may be made
against another party or parties under this Section 7(d), notify such party or
parties from whom contribution may be sought, but the omission so to notify such
party or parties from whom contribution may be sought shall not relieve such
party from any other obligation it or they may have thereunder or otherwise
under this Section 7(d) except to the extent that the party or parties from whom
contribution may be sought are adversely affected. No party shall be liable for
contribution with respect to any action, suit, proceeding or claim settled
without its prior written consent, which consent shall not be unreasonably
withheld, conditioned or delayed.
8. Reporting. With a view to making available to the Rightsholders the
benefits of Rule 144 promulgated under the Securities Act or any other similar
rule or regulation of the Commission that may at any time permit the
Rightsholders to sell securities of the Company to the public without
registration ("Rule 144"), for so long as Rightsholders continue to own
Registrable Securities, the Company shall use its reasonable efforts to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144, and 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
(b) furnish to each Rightsholder, for so long as such Rightsholder
owns Registrable Securities, promptly upon request, (i) a written statement by
the Company, if true, that it has complied with the applicable reporting
requirements of Rule 144, the Securities Act and the Exchange Act, (ii) a copy
of the most recent annual or quarterly report of the Company and (iii) such
other information as may be reasonably requested to permit the Rightsholders to
sell such securities pursuant to Rule 144 without registration.
9. Assignment of Registration Rights. The rights under this Agreement
shall not be assigned by any Rightsholder except in connection with the transfer
of Registrable Securities by such Rightsholder to an affiliate of such
Rightsholder, provided that (i) the Rightsholder agrees in writing with the
transferee or assignee to assign such rights, and a copy of such agreement is
furnished to the Company; (ii) the Company is furnished with written notice of
(a) the name and address of such transferee or assignee, and (b) the securities
with respect to which such rights are being transferred or assigned; (iii) at or
before the time the Company receives the written notice contemplated by clause
(ii) of this sentence, the transferee or assignee agrees in writing with the
Company to be bound by all of the obligations of an Rightsholder under this
Agreement; and (iv) such transfer shall have been conducted in accordance with
all applicable federal and state securities laws.
10. Amendment of Registration Rights.
(a) Any provision of this Agreement may be amended and the
observance of any provision of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), only with
the written consent of the Company and Rightsholders who then hold at least a
majority of the Registrable Securities. Any amendment or waiver effected in
accordance with this Section 10 shall be binding upon each Rightsholder and
7
the Company. No such amendment shall be effective to the extent that it applies
to less than all of the holders of the Registrable Securities. No consideration
shall be offered or paid to any Person to amend or consent to a waiver or
modification of any provision of any of this Agreement unless the same
consideration also is offered to all of the parties to this Agreement.
(b) In the event that the Company issues and sells Units as part
of the Unit Offering after the date hereof, the Company shall have the right to
amend this Agreement without the consent of the Rightsholders to include the
purchasers of such Units in this Agreement as Purchasers and Rightsholders and
any placement agent or selected dealer that receives warrants in connection with
the sale of such Units as an Agent and Rightsholder and in connection therewith
to modify the Schedule of Purchasers to include such Purchaser and the Schedule
of Agents to include such Agent.
11. Miscellaneous.
(a) A Person is deemed to be a holder of Registrable Securities
whenever such Person owns or is deemed to own of record such Registrable
Securities. If the Company receives conflicting instructions, notices or
elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or
election received from the record owner of such Registrable Securities.
(b) Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile; or (iii) two
(2) Business Days after deposit with a reputable overnight delivery service, in
each case properly addressed to the party to receive the same. The addresses and
facsimile numbers for such communications shall be:
If to the Company:
Hybridon, Inc.
345 Vassar Street
Cambridge, MA 02139-4818
Telephone: 617-679-5500
Facsimile: 617-679-5592
Attention: Chief Financial Officer
with a copy to:
Wilmer Cutler Pickering Hale and Dorr LLP
60 State Street
Boston, MA 02109
Telephone: 617-526-6000
Facsimile: 617-526-5000
Attention: David E. Redlick, Esq.
8
If to a Rightsholder, to its address and facsimile number set forth on
the Schedule of Purchasers or on the Schedule of Agents, as the case
may be,
or to such other address and/or facsimile number and/or to the
attention of such other Person as the recipient party has specified by
written notice given to each other party five (5) days prior to the
effectiveness of such change.
Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender's facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission, or (C) provided by a courier or overnight courier service shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from a
reputable overnight delivery service in accordance with clause (i), (ii) or
(iii) above, respectively.
(c) Failure of any party to exercise any right or remedy under
this Agreement or otherwise, or delay by a party in exercising such right or
remedy, shall not operate as a waiver thereof.
(d) All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of Delaware, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of Delaware or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of Delaware.
(e) This Agreement and the documents referenced herein constitute
the entire agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein and therein. This
Agreement and the documents referenced herein supersede all prior agreements and
understandings among the parties hereto with respect to the subject matter
hereof.
(f) Subject to the requirements of Section 9 of this Agreement,
this Agreement shall inure to the benefit of and be binding upon the permitted
successors and assigns of each of the parties hereto.
(g) The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) This Agreement may be executed in identical counterparts, each
of which shall be deemed an original but all of which shall constitute one and
the same agreement. This Agreement, once executed by a party, may be delivered
to the other parties hereto by facsimile transmission of a copy of this
Agreement bearing the signature of the party so delivering this Agreement.
(i) Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the
9
intent and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(j) All consents and other determinations required to be made by
the Rightsholders pursuant to this Agreement shall be made, unless otherwise
specified in this Agreement, by Rightsholders holding at least a majority of the
Registrable Securities.
(k) The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.
(l) This Agreement is intended for the benefit of the parties
hereto and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the day and year first above written.
COMPANY:
HYBRIDON, INC.
By: /s/ Robert G. Andersen
---------------------------
Name: Robert G. Andersen
Title: CFO, VP Operations
PURCHASERS:
Counterpart signature pages attached.
AGENTS:
Counterpart signature pages attached.
10
Exhibit A
Schedule of Purchasers
Name and Address Registrable Securities
- ---------------- ----------------------
Optima Life Sciences Limited
St James's Chambers
64A, Athol Street
Douglas, Isle of Man, IM1 1JE
By: /s/ Youssef El Zein
----------------------------
Name: Youssef El Zein
Title: Director
Exhibit B
Schedule of Agents
Name and Address Registrable Securities
- ---------------- ----------------------
Pillar Investment Limited
St James's Chambers
64A, Athol Street
Douglas, Isle of Man, IM1 1JE
By: /s/ Youssef El Zein
--------------------------
Name: Youssef El Zein
Title: Director
Exhibit 99.9
Company Number: 108584C
THE COMPANIES ACTS 1931 to 1993
ISLE OF MAN
A PRIVATE COMPANY LIMITED BY SHARES
-------------------------------------------------
MEMORANDUM AND ARTICLES OF ASSOCIATION
OF
OPTIMA LIFE SCIENCES LIMITED
(adopted by Special Rsolution dated 19 August 2004)
-------------------------------------------------
DOUGHERTY & ASSOCIATES
Atlantic House
4-8 Circular Road
Douglas
Isle of Man
IM1 1AG
1
THE COMPANIES ACTS 1931 to 1993
ISLE OF MAN
A PRIVATE COMPANY LIMITED BY SHARES
MEMORANDUM OF ASSOCIATION
OF
OPTIMA LIFE SCIENCES LIMITED
1 The name of the Company is Opitima Life Sciences Limited.
2. The Company is a private company.
3. The liability of the members is limited.
4. Restrictions, if any, on the exercise of the rights, powers and
privileges of the Company: none, unless and until decided on by special
resolution of the Company.
5. The share capital of the Company is US $20,323,300 divided into 33
Management Shares of US $100.00 each and 10,000 Redeemable Preference A
Shares of US $797.00 each and 3,000 Redeemable Preference B Shares of
US $10.00 each and 15,400 Redeemable Preference C Shares of $797.00
each and 4620 Redeemable Preference D Shares of US$10.00 each.
We the subscribers to this memorandum of association:
a. wish to be formed into a company pursuant to this memorandum;
b. agree to take the number of shares shown opposite our names; and
c. declare that all the requirements of the Companies Acts 1931 to 1993 in
respect of matters relating to registration and of matters precedent
and incidental thereto have been complied with.
2
- ----------------------------------------------------------------------------
No. Names, Addresses and Number of Shares
Description of Subscribers taken by each
Subscriber
- ----------------------------------------------------------------------------
PILLAR INVESTMENT Limited 1
St James's Chambers
64a Athol Street
Douglas
Isle of Man
Youssef Mohamad Talaat El Zein
Director
- ----------------------------------------------------------------------------
TOTAL NUMBER OF SHARES TAKEN. 1
- ----------------------------------------------------------------------------
Dated this 10th day of June 2003
Witness to the above Signatures;-
Bialal Sidani
131 Avenue de Malakoff
75116-Paris
France
3
INDEX TO ARTICLES OF ASSOCIATION
PAGE
INTERPRETATION 5
EXPENSES 9
SITUATION OF OFFICE OF COMPANY 9
SHARE CAPITAL 9
ISSUE OF SHARES 10
QUALIFIED HOLDERS 13
VARIATION OF RIGHTS 14
SHARE CERTIFICATES 15
LIEN 16
CALLS ON SHARES 17
REGISTER OF SHAREHOLDERS 17
TRANSFER OF SHARES 18
FORFEITURE OF SHARES 19
DETERMINATION OF NET ASSET VALUE 21
REDEMPTION OF SHARES 24
ALTERATION OF SHARE CAPITAL 27
GENERAL MEETINGS 28
NOTICE OF GENERAL MEETINGS 28
PROCEEDINGS AT GENERAL MEETINGS 29
VOTES OF MEMBERS 30
DIRECTORS 33
POWERS OF DIRECTORS 37
INVESTMENT OF THE COMPANY'S ASSETS 38
PROCEEDINGS OF DIRECTORS 39
BORROWING POWERS 41
SECRETARY 41
THE CUSTODIAN 41
THE SEAL 42
DIVIDENDS 42
SHARE PREMIUM AND RESERVE
ACCOUNTS AND EQUALISATION ACCOUNT 43
ACCOUNTS 44
AUDIT 45
NOTICES 46
WINDING UP 48
INDEMNITY 48
4
THE COMPANIES ACTS 1931 to 1993
A PRIVATE COMPANY LIMITED BY SHARES
ARTICLES OF ASSOCIATION
OF
OPTIMA LIFE SCIENCES LIMITED
INTERPRETATION
1A. It is intended that the Company be an exempt international collective
investment scheme as defined by section 11(7) of the Financial
Supervision Act 1988 of the Isle of Man and, accordingly, the Company
shall have fewer than 50 members.
1B. The provisions of Table A contained in the Schedule to the Companies
(Memorandum and Articles of Association) Regulations 1988 shall not
apply to the Company. In these articles the following words and
expressions shall, where not inconsistent with the context, have the
following meanings respectively:
"Acts" means the Companies Acts 1931 to 1993 of the Isle of Man and
every statutory modification or re-enactment thereof for the time being
in force;
"Auditors" means the auditor or auditors for the time being of the
Company appointed pursuant to article 116hereof;
"business day" means any day on which banks are normally open for
business in the Island and in London;
"Collective Investment Scheme" means a collective investment scheme as
defined by the law of the Island;
"Directors" means the directors of the Company;
"Dollars" and "cents" and the abbreviations "US$' and "c" mean dollars
and cents respectively in the currency of the United States;
"Equalisation Account" means an account maintained in accordance with
article 111 (4) hereof and to which shall be credited all Equalisation
Payments;
"Equalisation Payment" means that part of the Issue Price credited to
the Equalisation Account upon subscription for Participating Shares in
accordance with article 9(4) hereof,
5
"fiscal charges" includes stamp duty and any other governmental taxes
duties or charges;
"Hybridon" means Hybridon Inc. a publicly traded United States
incorporated Company whose registered office is situate at 345 Vassar
Street Cambridge, MA 02139 and trading under the OTC Stock Exchange;
"Initial Offer Hybridon Shares" means common shares or such other
shares as are held by the Company in Hybridon prior to the Secondary
Offer Period and after the Initial Offer Period;
"Initial Offer Period" means the period commencing from 1 July 2003 and
ending on the Secondary Offer Period;
"Investment" means any investment made by the Company which is
authorised by the memorandum of association of the Company;
"Island" means the Isle of Man;
"Issue Price" means the price at which a Participating Share is issued
or transferred as provided in article 9(2), 9(3) or 9(5) hereof which
price together with any initial charge and rounding-up charge made by
the Company pursuant to article 9(6) hereof constitutes the price at
which such share is issued or transferred to any applicant therefor;
"in writing" and "written" includes printing, lithography, photography,
facsimile and telex transmission and other modes of representing or
reproducing words in permanent visible form;
"Management Shares" means a share in the capital of the Company having
a nominal value of US$1.00 designated as a Management Share and having
the rights specified in these articles with respect to such shares;
"Manager" means any person firm or corporation appointed to carry out
management and administrative duties pursuant to article 87(1) hereof,
"may" shall be construed as permissive;
"Net Asset Value" means the value of the net assets of the Company as
determined pursuant to article 34(1) hereof;
"notice" means written notice unless otherwise specifically stated;
"Participating Shares" means the participating redeemable preference A
shares, the participating redeemable preference B shares the
participating redeemable
6
Preference C Shares and the participating redeemable preference D
Shares in the capital of the Company issued subject to and in
accordance with section 46A of the Principal Act and these articles and
having the rights specified in these articles with respect to such
shares;
"Redeemable A Shares" means the non-voting redeemable preference A
shares of par value US $797.00 each in the capital of the Company;
"Redeemable B Shares" means the non-voting redeemable preference shares
of par value US $10.00 each in the capital of the Company;
"Redeemable C Shares" means the non-voting redeemable preference C
shares of par value US $797.00 each in the capital of the Company;
"Redeemable D Shares" means the non-voting redeemable preference D
shares of par value US $10.00 each within the capital of the Company;
"Principal Act" means the Companies Act 1931;
"Initial Redemption Charge" means a carried interest of 15% on the
difference between the Net Asset Value of the Participating Shares at
the time of Redemption and the Net Asset Value at the time of the
Initial Offer Period when the Initial Offer Hybridon Shares were
purchased;
"Redemption Day" means any day which the Directors shall from time to
time in their absolute discretion appoint as a Redemption Day being not
less than one day in every month;
"Register" means the register maintained in accordance with article
24(1);
"Registrar" means any person appointed to perform the duties of
registrar and transfer agent (and includes and sub-agent) and, if no
such person shall be appointed, means the Secretary;
"Seal" means the common seal of the Company;
"Secondary Offer Hybridon Shares" means the common shares or such other
shares purchased by the Company in Hybridon after the Secondary Offer
Period;
"Secondary Offer Period" means the period commencing from the 15th July
2004;
"Secondary Offer Redemption Charge" means a carried interest of 15% on
the difference between the Net Asset Value of the Participating Shares
at the time of Redemption and the Net Asset Value at the time of the
Secondary Offer Period when the Secondary Offer Hybridon Shares were
purchased;
7
"Secretary" shall include a temporary or assistant Secretary and any
person appointed by the Directors to perform any of the duties of the
Secretary and in the event of two or more persons being appointed as
joint Secretaries means any one or more of the persons so appointed;
"Securities Market" means any recognised stock exchange or other
securities market including in relation to any particular Investment
one or more responsible firms corporations or associations in any part
of the world so dealing in the Investment to be expected generally to
provide in the opinion of the Company a satisfactory market for the
Investment;
"shall" shall be construed as imperative;
"Shareholder" means any person registered in the Register as the holder
of shares in the Company, and, when two or more persons are so
registered as joint holders 'of shares, means the person whose name
stands first in the Register as one of such joint holders;
"Share Premium Account" means the account established pursuant to
article 111(1);
"B Warrants" means warrants held by the Company in Hybridon as from the
Initial Offer Period prior to the Secondary Offer Period. The value of
the B Warrants at any point in time will be determined by the
difference in the strike price and current market value as well as the
remaining validity of the B Warrants. Before the B Warrants are traded
the B Warrants will have no value and will not carry a Net Asset Value;
"D Warrants" means the D Warrant acquired by the Company in Hybridon
after the Secondary Offer Period given to the Company on the purchase
of the Secondary Offer Hybridon Shares by Hybridon. The value of the D
Warrants at any point in time will be determined by the difference in
the strike price and the current market value as well as the remaining
validility of the D Warrants. Before the D Warrants are traded the D
Warrants have no value and will not carry a Net Asset Value;
"Subscription Day" means any day which the Directors shall from time to
time in their absolute discretion appoint as a Subscription Day being
not less than one day in every month;
"Undistributed Income of the Company" means the aggregate as at any
Valuation Day of (a) the undistributed income of the Company after the
deduction of all liabilities payable therefrom and (b) any Equalisation
Payment then held by or due
8
to the Company no part of which is returnable to a holder of
Participating Shares as at that date;
"United Kingdom" means the United Kingdom of Great Britain and Northern
Ireland;
"United States" means the United States of America (including the
District of Columbia) its territories and possessions and all areas
subject to its jurisdiction;
"U.S. Person" means any person who is a citizen of the United States or
a corporation, partnership or other entity created or organised in or
under the laws of the United States or a political sub-division thereof
or an estate or trust the income of which is subject to United States
federal income taxation, regardless of its source of income;
"Valuation Day" means such day or days and such time thereon as the
Directors shall in their absolute discretion determine for the purposes
of valuing the net assets of the Company.
2. (1) In these articles, unless there be something in the subject of
context inconsistent with such construction:
(a) words importing the singular include the plural, and
vice versa;
(b) words importing any gender include every gender, and
vice versa;
(c) words importing persons include bodies corporate and
unincorporate, and vice versa; and
(d) words or expressions contained in these articles
shall bear the same meaning as in the Acts and the
Interpretation Act 1976 of the Isle of Man.
(2) The Company is a private company and accordingly no invitation may
be made to the public or any section of it in any part of the world to
subscribe for or purchase shares in or debentures of the Company.
EXPENSES
3. (1) The expenses (if any) borne by the Company in connection with the
formation of the Company the initial issue of Participating Shares
shall be amortised over such period and in such manner as the Directors
may determine and the amount so paid shall in the accounts of the
Company be charged against income or capital as determined by the
Directors.
9
(2) The business of the Company shall be commenced as soon after the
incorporation of the Company as the Directors think fit,
notwithstanding that any initial offer of shares may have been only
partially subscribed.
SITUATION OF OFFICE OF COMPANY
4. (1) The registered office of the Company shall be at such address in
the Island as the Directors shall from time to time determine.
(2) The Company, in addition to its registered office, may establish
and maintain such other offices and places of business and agencies in
any part of the world outside the United Kingdom as the Directors may
from time to time determine.
SHARE CAPITAL
5. (1) The share capital of the Company is US $20,373,300.00 divided into
33 Management Shares of US $100.00 each, 10,000 Redeemable A Shares of
$797.00 each, 3,000 Redeemable B Shares of $10.00 each, 15,400
Redeemable C Shares of $797.00 each and 4620 Redeemable D Shares of
$10.00 each.
6. Management Shares shall only be issued at par and to such person or
persons as the Directors may determine. The Management Shares shall
confer upon the holders thereof the right in a winding-up or repayment
of capital, subject to the prior repayment of the nominal amount paid
up on the Participating Shares to the repayment of the nominal amount
paid upon the Management Shares but shall confer no further or other
right to participate in the profits or assets of the Company.
7. (1) The Redeemable A Shares and the Redeemable C Shares shall confer
upon the holders thereof in a winding up (a) the right to redemption as
herein set out in priority to any payment to the holders of shares of
any other class, of the nominal amount paid up thereon, and (b) the
further right, after the repayment of the nominal amounts paid up on
the Management Shares, to be paid an amount equal to that proportion of
the Company's total net assets (after paying or providing for all
expenses of liquidation and other liabilities and the said repayments)
which their respective holdings of Participating Shares represent at
the commencement of winding-up.
8. The Redeemable B Shares and the Redeemable D Shares shall confer on the
holders thereof in a winding-up the right, subject to the prior
redemption of the Redeemable A Shares and the Redeemable C Shares, to
the redemption of the Redeemable B Shares and the Redeemable D Shares,
but shall confer no further or other right to participate in the
profits or assets of the Company unless and until
10
the Directors have exercised the Warrants as outlined in these
articles. Redeemable B Shares and Redeemable D Shares may be redeemed
at par.
ISSUE OF SHARES
9. (1) Subject to the provisions of this article, the Company on receipt
by it or its authorised agent or agents of an application in writing or
in such other form as the Directors may from time to time determine,
may allot and issue Participating Shares at the price hereinafter
determined or, at the option of the Directors, procure the transfer to
the applicant of fully paid Participating Shares (as the case may be)
at not more than such price.
Provided that:
(a) subject to proviso (d) below, the issue or the transfer of
Participating Shares pursuant to this article shall be made on
the Subscription Day following the receipt of such application
or in the absolute discretion of the Directors on the day of
such receipt provided that such day is a Subscription Day;
(b) except as the Directors may otherwise determine from time to
time, an application for Participating Shares shall be deemed
not to be received until the moneys in respect of the issue
(or, as the case may be, transfer) of the Participating Shares
shall have been received by or on behalf of the Company;
(c) the Directors shall in their absolute discretion be entitled
to reject any application in whole or in part;
(d) no Participating Shares shall be issued or transferred (except
those for which applications have been previously received and
accepted by the Company) during any period when the
determination of the Net Asset Value is suspended pursuant to
article 34(3) hereof;
(e) subject to receipt of any necessary exchange control or other
governmental consent payment shall be made in such currency,
at such time and place and to such person on behalf of the
Company as the Directors may from time to time determine.
(2) The price per share at which the initial issue of Participating
Shares shall be made shall be determined by the Directors.
(3) Subject as hereinafter provided, any issue (or, as the case may be,
transfer procured pursuant to paragraph (1) of this article) of
Participating Shares
11
subsequent to the first issue of shares shall be made on a Subscription
Day at a price per share ascertained by:
(a) assessing the Net Asset Value on the relevant
Valuation Day; and
(b) dividing the amount calculated under (a) above by the
number of Participating Shares then in issue or
deemed to be in issue; and
(c) applying the initial charge referred to in article
9(6) below; and
(d) adding thereto such a sum as the Directors may
consider represents the appropriate provision for
fiscal or other charges arising in the Island in
connection with the issue of the share or any
document of title thereto; and
(e) rounding the resultant figure upwards to the nearest
whole cent the result of such rounding being for the
absolute benefit of the Company.
(4) In the event that the Directors are operating an Equalisation
Account, that part of the Issue Price representing the Undistributed
Income of the Company shall be deemed to constitute an Equalisation
Payment and shall be credited to the Equalisation Account in accordance
with article 111(4) hereof.
(5) The Directors shall be entitled from time to time to make an
invitation to such persons as they shall think fit to apply for
Participating Shares otherwise than as provided in paragraph (3) of
this article at a fixed price (in this article hereinafter referred to
as "the fixed price") of not less than the sum ascertained pursuant to
paragraph (3) of this article as at a business day not earlier than the
fifth business day immediately preceding the date on which the
invitation is first made and for a period not exceeding 30 business
days from the date of making such invitation. Participating Shares may
be issued and allotted at the fixed price whether pursuant to such
offer or not provided that the Directors shall forthwith close such
offer if the fixed price would exceed by more than three per cent the
current Issue Price on any Subscription Day during the period of such
invitation and may forthwith close such offer if the fixed price would
be lower than the current Issue Price on any such Subscription Day by
more than three per cent.
(6) The Directors shall be entitled to authorise the Manager to add to
the Issue Price (including, for the avoidance of doubt, the fixed
price) in respect of each Participating Share such sum as may be
necessary to adjust the final price (being the Issue Price plus the
initial charge, if any) of the Participating Share upwards to the
nearest whole cent and accordingly, in the event of such authority
having been given to the Manager, every subscriber shall in addition to
the Issue Price in respect of each Participating Share pay any such
initial charge and other sum as
12
may be added to the Issue Price pursuant hereto to the Company for the
absolute use and benefit of the Company.
(7) The Directors shall be entitled to authorise the Manager to charge
the subscriber for or transferee of any Participating Shares a handling
fee not exceeding such sum per transaction as the Directors shall
determine and accordingly, in the event of such authority having been
given to and being exercised by the Manager, every subscriber and
transferee shall in addition to the sums referred to in paragraph (6)
of this article pay any such handling fee to the Company or other
person referred to in any private placement memorandum as receiving any
initial charge or to the Company or other such person as aforesaid for
the absolute use and benefit of the Company.
(8) The Directors shall issue shares on terms that the persons to whom
they are issued shall bear any fiscal charges which may be incurred
outside the Island.
10. Except with the consent of a separate class meeting of the holders of
the Participating Shares held as provided below, no shares in the
capital of the Company shall be issued other than as Management Shares
or Participating Shares.
11. All shares in the Company for the time being unissued shall be under
the control of the Directors, who may allot and dispose of the same in
such manner as they think fit in accordance with the terms of these
articles.
12. The Company may pay brokerage to any person in consideration of his
subscribing or agreeing to subscribe, whether absolutely or
conditionally, for any shares in the Company, or procuring or agreeing
to procure subscriptions, whether absolute or conditional, for any
shares in the Company.
13. Save as herein otherwise provided, the Company shall be entitled to
treat the registered holder of any share as the absolute owner thereof,
and accordingly shall not, except as by statute required, be bound to
recognise any equitable or other claim or interest in such share on the
part of any other person.
14. (1) If two or more persons are registered as joint holders of any
shares, then any one of such joint holders may give effectual receipts
for moneys payable in respect of the shares held by them as joint
holders.
(2) The Company shall not be bound to register more than four persons
as the joint holders of any share.
QUALIFIED HOLDERS
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15. (1) If it shall come to the notice of the Directors that any
Participating Shares are owned directly or beneficially either by any
person in breach of any law or requirement of any country or
governmental authority or by any U.S. Person (save where such U.S.
Person may lawfully own the same) or by virtue of which any person who
shall belong to or be comprised within any class of persons from time
to time for the purposes of this article stipulated by the Company,
then the Directors may give notice to such person requiring him to
transfer such shares to a person who is qualified or entitled to own
the same or to give a request in writing for the redemption of such
shares in accordance with article 35. If any person upon whom such a
notice is served pursuant to this article does not within thirty days
after service of such notice transfer his shares to a person qualified
or permitted to own the same or establish to the satisfaction of the
Directors (whose judgement shall be final and binding) that he is
qualified, entitled and permitted to own the shares, he shall be deemed
upon the expiration of thirty days to have given a request in writing
for the redemption of all his shares pursuant to article 35 whereupon
he shall be bound forthwith to deliver to the Company or one of its
duly authorised agents the certificate or certificates (if any) for his
shares.
(2) A person who becomes aware that he is holding or owning
Participating Shares in breach of any law or requirement of any country
or governmental authority or that he is a U.S. Person (save where such
U.S. Person may lawfully own the same) or a person who belongs to or is
comprised within any class of persons from time to time for the
purposes of this Article stipulated by the Company shall forthwith
unless he has already received a notice pursuant to article 15(1)
either transfer all his shares to a person qualified or permitted to
own the same or give a request in writing for the redemption of all his
shares pursuant to article 35.
(3) The proceeds of any redemption effected pursuant to articles 15(1)
or 15(2) will be deposited by the Company in a bank for payment to any
such person against surrender of the certificate or certificates
representing the Participating Shares previously held by such person or
the proffering of such other evidence as to title as the Directors may
require. Upon the deposit of such proceeds of redemption as aforesaid,
such person shall have no further interest in such Participating Shares
or any of them or any claim against the Company in respect thereof
except the right to receive the proceeds of redemption so deposited
(without interest) upon surrender of the said certificate or
certificates.
(4) The exercise by the Directors of the power conferred by article
15(1) shall not be questioned or invalidated in any case on the grounds
that there was insufficient evidence of ownership of Participating
Shares by any person or that the true ownership of any Participating
Shares was otherwise than appeared to the Directors at the relevant
date provided the said powers shall have been exercised in good faith.
14
(5) If it shall come to the notice of the Directors that any
Participating Shares are owned directly or beneficially by any person
such that the status, standing or tax residence of the Company is or
may be prejudiced or the Company may suffer any pecuniary or regulatory
disadvantage which it would not otherwise have suffered the Directors
may resolve to give notice in writing in accordance with article 15(1)
hereof to any such person requiring him to transfer such shares or to
redeem such shares in accordance with article 3.
(6) The Directors may at any time and from time to time call upon any
holder of Participating Shares by notice in writing to provide the
Directors with such information and evidence as they shall require upon
any matter connected with or in relation to such holder of
Participating Shares in order to satisfy themselves upon any matter
concerning in their opinion the status, standing or tax residence of
the Company or any pecuniary or regulatory disadvantage which they
consider the Company might suffer as a result of that person continuing
to hold Participating Shares.
(7) In the event of such information and evidence not being so provided
within a reasonable time (not being less than fourteen days after
service of the notice requiring the same) the Directors shall forthwith
serve such holders of Participating Shares with a further notice
calling upon him, within seven days after service of such further
notice, to transfer his shares or to redeem such shares in accordance
with article 3 and, failing action by him within such seven days to
implement that notice, he shall be deemed to have given a request in
writing for the redemption of all his shares in accordance with article
35 whereupon he shall be bound forthwith to deliver to the Company or
one of its duly authorised agents the certificate or certificates (if
any) for his shares and until such time as the certificate or
certificates as aforesaid are received by the company or one of its
duly authorised agents the proceeds of any such redemption shall be
deposited by the Company in a bank in accordance with article 15(3)
hereof.
VARIATION OF RIGHTS
16. If at any time the share capital is divided into different classes of
shares, the rights attaching to any class (unless otherwise provided by
the terms of issue of the shares of that class) may, whether or not the
Company is being wound up, be varied with the consent in writing of the
holders of three-fourths of the issued shares of that class, or with
the sanction of a resolution passed at a separate general meeting. To
every such separate general meeting the provisions of these articles
relating to general meetings shall mutatis mutandis apply but so that
the quorum shall be the holders of at least one-third of the shares of
the class.
17. (1) The rights attached to the Participating Shares shall be deemed to
be varied by any variation of the rights attached to shares of any
other class or by the
15
creation or issue of any shares other than Participating Shares ranking
in priority to or pari passu with them as respects rights in a
winding-up and rights to dividend.
(2) Subject to the foregoing provisions of this article, the rights
conferred upon the holders of the shares of any class issued with
preferred or other special rights shall not, unless otherwise expressly
provided by the terms of issue of the shares of that class, be deemed
to be varied by the creation or issue of further shares ranking pari
passu therewith.
SHARE CERTIFICATES
18. (1) Every Shareholder shall upon written request being made to
the Company at its registered office, be entitled to receive, without
payment, within two months after the allotment of any shares of
which he becomes the first registered holder or the lodgement of a
transfer of any shares into his name, one certificate for all shares of
the same class so allotted or transferred or upon the payment of such
sum not exceeding 5 cents as the Directors may require for each
certificate in excess of one, to several certificates each for one or
more of such shares. Every share certificate shall be issued under the
Seal and shall, unless and until otherwise determined by the Directors,
bear the signatures of two directors or of one Director and the
Secretary. The Directors may from time to time determine that such
signatures or any of them need not be manual but may be printed or
reproduced in any other manner, or that such signatures may be
dispensed with, notwithstanding any other provision of these articles
with respect to the affixing of the Seal.
(2) Each share in the capital of the Company shall be distinguished by
its appropriate number provided that if at any time the issued shares
in the Company or all the issued shares therein of a particular class
are fully paid up and rank pari passu for all purposes, none of those
shares need thereafter have a distinguishing number so long as it
remains fully paid up and ranks pari passu for all purposes with all
shares of the same class for the time being issued and fully paid up.
19. If any certificate be worn out or defaced, then upon production thereof
to the Directors, and on such reasonable indemnity as the Directors
deem adequate being given, they shall order the same to be cancelled
and shall issue a new certificate in lieu thereof without charge. If
any such certificate be lost or destroyed, then upon proof thereof to
the satisfaction of the Directors, and on such reasonable indemnity as
the Directors deem adequate being given, a new certificate in lieu
thereof shall be issued without charge.
20. Where a Shareholder transfers part only of the shares comprised in a
share certificate the old certificate shall be cancelled and upon
written request a new certificate for the balance of such shares issued
in lieu without charge.
16
21. The certificates of shares registered in the name of two or more
persons shall, unless otherwise directed by them, be delivered to the
person first named on the Register and delivery to that person shall be
sufficient delivery to all.
LIEN
22. (1) The Company shall have a first and paramount lien on every share
(not being a fully paid share) for all moneys (whether presently
payable or not) called or payable at a fixed time in respect of the
share, and the Company shall also have a similar lien on all shares
(other than fully paid shares) standing registered in the name of a
Shareholder (whether solely or jointly with others) for all moneys
presently payable by him or his estate to the Company whether the
period for the payment or discharge of the same shall have actually
arrived or not, and notwithstanding that the same are joint debts or
liabilities of such Shareholder or his estate and any other person,
whether a Shareholder or not; but the Directors may at any time
declare any share to be wholly or in part exempt from the provisions
of this article. The Company's lien, if any, on a share shall extend
to all dividends payable thereon.
(2) The Company may sell, in such manner as the Directors may think
fit, any shares on which the Company has a lien, but no sale shall be
made unless some sum in respect of which the lien exists is presently
payable, nor until the expiration of fourteen days after a notice
stating and demanding payment of such part of the amount in respect of
which - the lien exists as is presently payable has been given to the
registered holder for the time being of the shares or to the person
entitled thereto by reason of his death or bankruptcy.
(3) To give effect to such sale the Directors may authorise some person
to transfer the shares sold to the purchaser thereof. The purchaser
shall be registered as the holder of the shares comprised in such
transfer and he shall not be bound to see to the application of the
purchase money, nor shall his title to the share be affected by any
irregularity or invalidity in the proceedings in reference to the sale.
(4) The net proceeds of the sale after payment of the costs thereof
shall be received by the Company and applied in payment of such part of
the amount in respect of which the lien exists as is presently payable
and the residue, if any, shall (subject to a like lien for sums not
presently payable as existed upon the shares before the sale) be paid
to the persons entitled to the shares at the date of the sale.
CALLS ON SHARES
23. (1) The Directors may from time to time make calls upon the
Shareholders in respect of moneys unpaid on their shares and not by the
conditions of the issue thereof payable at fixed times. A call may be
revoked or postponed as the Directors may determine.
17
(2) A call shall be deemed to have been made at the time when the
resolution of the Directors authorising the call was passed and may be
required to be paid by instalments.
(3) If a sum called in respect of a share is not paid by the day
appointed for payment thereof, the person from whom the sum is due
shall pay interest on the sum from the day appointed for payment
thereof to the time of actual payment at such rate not exceeding
fifteen per cent. per annum as the Directors may determine but the
Directors shall be at liberty to waive payment of such interest wholly
or in part.
(4) Any sum which by the terms of issue of a share becomes payable on
allotment or at any fixed date shall for the purposes of these articles
be deemed to be a call duly made and payable on the date on which be
the terms of issue the same becomes payable and in case of non-payment
all the relevant provisions of these articles as to payment of interest
and expenses, forfeiture or otherwise shall apply as if such sum had
become payable by virtue of a call duly made and notified.
(5) The Directors may, if they think fit, receive from any Shareholder
willing to advance the same, all or any part of the moneys uncalled and
unpaid upon any shares held by him and upon all or any of the moneys so
advanced may pay interest at such rate not exceeding ten per cent. per
annum as may be agreed between the Directors and the Shareholder paying
such sum in advance but such a shareholder shall not be entitled to
participate in respect thereof in a dividend subsequently declared.
(6) The joint holders of any share shall be jointly and severally
liable to pay calls in respect thereof.
REGISTER OF SHAREHOLDERS
24. (1) The Directors shall keep or cause to be kept at the registered
office of the Company a register of Shareholders in the manner required
by the Acts.
(2) Upon allotment of a share or upon registration of any transfer or
transmission of a share the name of the allottee or person acquiring
the share by transfer or transmission shall be entered in the Register
in respect of such share.
(3) The Directors shall cause to be entered in the Register in addition
to the particulars required to be so entered by the Acts the following
particulars:-
18
(a) the name and address of each Shareholder, a statement
of the shares of each class held by him and of the
amount paid or agreed to be considered as paid on
such shares;
(b) the date on which each person was entered in the
Register as a Shareholder; and
(c) the date on which any person ceased to be a
Shareholder.
(4) The Register shall be kept in such manner as to show at all times
the Shareholders of the Company for the time being and the share
respectively held by them.
(5) The Register shall be open to inspection at the registered office
of the Company or at such other place as aforesaid between 10 a.m. and
1 p.m. on every business day. Such inspection by any Shareholder shall
be without charge and such inspection by any person other than a
Shareholder shall be subject to the payment of a reasonable fee to be
fixed by the Directors but not exceeding any maximum imposed by law.
(6) Every Shareholder of the Company and any other person may acquire a
copy of the Register or any part thereof on the payment of a reasonable
fee to be fixed by the Directors but not exceeding any maximum imposed
by law.
(7) The Company may after giving notice by advertisement in two local
newspapers circulating in the Island and a leading London newspaper
with international circulation to that effect close the Register for
any time or times not exceeding in total thirty days in each year.
TRANSFER OF SHARES
25. Subject to the provisions of these articles, shares in the Company
shall be transferable by a transfer in any usual or common form in use
in the Island or in such other form as the Directors shall from time to
time sanction or allow, but so that every form of transfer shall relate
to shares of one class only and shall state the full name and address
(and, if required by the Directors, the nationality) of the transferor
and of the transferee.
26. Instruments of transfer shall be signed by the transferor (and, in the
case of partly paid shares, by the transferee) and shall be dated on
the day on which they are signed. The transferor of a share shall be
deemed to remain the holder of such shares until the same have been
transferred to the transferee in the Register.
27. The Directors may decline to register any transfer of shares not being
fully paid shares to a person of whom they do not approve or on which
the Company has a
19
lien. If the Directors refuse to register a transfer they shall within
two months after the date on which the transfer was lodged with the
Company send to the transferee notice of the refusal. Subject as
aforesaid, any share shall be transferred on the application of the
transferor or the transferee on delivery to the Company of an
instrument of transfer in compliance with these articles.
28. Subject to article 9(7) the Company shall not be entitled to charge any
fee for registering any transfer, probate, letters of administration,
certificate of marriage or death, or other instrument relating to or
affecting the title to any shares.
29. The executors or administrators of a deceased Shareholder shall, except
as provided hereinafter, be the only persons recognised by the Company
as having any title to his shares, but this shall not apply in the case
of one or more joint holders of a share except in the case of the last
survivor of such joint holders.
30. Subject to article 27 any person becoming entitled to a share in
consequence of the death of any Shareholder may be registered as a
Shareholder upon such evidence being produced as the Directors may deem
sufficient or may, instead of being registered himself, elect to have
some person named by him registered as a transferee of such share, and
in such case the person becoming entitled shall execute in favour of
his nominee an instrument of transfer and on presentation thereof to
the Directors, accompanied by such evidence as they may require to
prove the title of the transferor, the transferee shall, subject to
article 9(7) and to the Directors' right to decline registration under
the said article 27, be registered as a shareholder.
31. With respect to any shares registered in the name of any person who has
been lawfully declared to be a bankrupt or in respect of whom a
receiver has been appointed or whose property has passed under the
control of a receiver or other person appointed by a court of competent
jurisdiction, the Directors shall comply with any request for any
change in such registration made by any person lawfully authorised so
to do, provided that the Directors may refuse to make any such change
in the Register until and unless they are satisfied that it is right
and proper for such change to be made. The burden of justifying any
such change shall be upon the person requesting such change.
FORFEITURE OF SHARES
32. (1) If any Shareholder fails to pay any call or instalment on or before
the day appointed for payment of the same, the Directors may at any
time thereafter, during such time as the call or instalment remains
unpaid, serve a notice on such Shareholder requiring him to pay the
same, together with any interest that may have accrued, at such rate as
the Directors may from time to time determine not exceeding 15 per cent
per annum. and all expenses that may have been incurred by the Company
by reason of such non-payment.
20
(2) The notice shall name a day (not less than fourteen days from the
date of service of the notice) and a place on and at which such call or
instalment and such interest and expenses as aforesaid are to be paid.
The notice shall also state that failing payment at or before the time
and at the place appointed the shares in respect of which the call was
made or instalment is payable will be liable to be forfeited.
(3) If the requirements of any such notice as aforesaid are not
complied with, any shares in respect of which such notice has been
given may, at any time thereafter, before payment of all calls or
instalments and interest and expenses due in respect thereof, be
forfeited by resolution of the Directors to that effect. Such
forfeiture shall include all distributions payable or accruing in
respect of the forfeited shares and not actually paid before
forfeiture.
(4) When any share shall have been so forfeited notice of the
resolution shall be given to the person in whose name it stood
immediately before the forfeiture and an entry of the forfeiture, with
the date thereof, shall forthwith be made in the Register.
(5) Any share so forfeited shall be deemed to be the property of the
Company and the Directors may sell, re-allot and otherwise dispose of
the same in such manner as they think fit.
(6) The Directors may, at any time before any share so forfeited shall
have been sold, re-allotted or otherwise disposed of, annul the
forfeiture thereof upon such conditions as they think fit.
33. (1) A record in the minute book of the Company that a share has been
duly forfeited in pursuance of these presents and stating the time
when it was forfeited shall be conclusive evidence of the facts
therein stated as against all persons claiming to be entitled to the
share adversely to the forfeiture thereof and such record and the
receipt of the Company for the consideration (if any) given for the
share on a sale, re-allotment or disposal thereof together with the
certificate for the share delivered to the purchaser or allottee
thereof, shall (subject to the execution of a transfer if the same be
so required) constitute a good title to the share and the person to
whom the share is sold, re-allotted or disposed of shall be registered
as the holder of the share and shall not be bound to see to the
application of the consideration (if any) nor shall his title to the
share be affected by any irregularity or invalidity in the proceedings
inreference to the forfeiture, sale, re-allotment or disposal of the
share.
(2) Any person whose shares have been forfeited shall nevertheless be
liable to pay and shall forthwith pay to the Company all calls,
instalments, interest and expenses owing upon or in respect of such
shares at the time of forfeiture together
21
with interest thereon from the time of forfeiture until payment as 15
per cent per annum or such lesser rate as the Directors may determine
and the Directors may enforce the payment as they think fit.
DETERMINATION OF NET ASSET VALUE
34. (1) The value of the net assets in the Company shall be determined by
the Directors on each Valuation Day (except when determination of such
value has been suspended under the provisions of paragraph (3) of this
article) and shall be the value as at such Valuation Day of all the
assets of the Company less all the liabilities of the Company
calculated in accordance with the provisions of this article and less
any charges on the redemption of shares as outlined within these
articles.
(2) Any determination of the Net Asset Value made pursuant to this
article shall be binding on all parties.
(3) The Directors may declare a suspension of the determination of the
Net Asset Value when it is reasonable to do for the whole of any part
of any period (a) during which any Securities Market or money or
foreign exchange market is closed, other than customary weekend and
holiday closings, (b) during which trading on any such Securities
Market or money or foreign exchange market is restricted, or (c) during
which a breakdown occurs in any of the means normally employed by the
Directors in ascertaining the prices of the Company's Investments or
for any other reason the prices of the Company's Investments cannot in
the opinion of the Directors reasonably be ascertained or circumstances
exist as a result of which, in the opinion of the Directors, it is not
reasonably practicable for the Company to realise any of the Company's
Investments or to receive remittances arising from realisation of such
Investments either at all or at normal rates of exchange. Such
suspension shall take effect at such times as the Directors shall
specify but not later than the close of business on the business day
next following the declaration and thereafter there shall be no
determination of the Net Asset Value until the Directors shall declare
the suspension at an end, except that the suspension shall terminate in
any event on the day following the first business day on which (i) the
condition giving rise to the suspension shall have ceased to exist and
(ii) no other condition under which suspension is authorised under this
paragraph (3) shall exist. Whenever the Directors shall declare a
suspension of the determination of the Net Asset Value under the
provisions of this paragraph then as soon as may be practicable after
any such declaration the Directors shall cause a notice to be placed in
a local newspaper in circulation in the Isle of Man and a leading
London newspaper with international circulation stating that such
declaration has been made and at the end of any period of suspension
the Directors shall cause another notice to be placed in such local
newspaper and such leading London newspaper stating that the period of
suspension has ended.
22
(4) The assets of the Company shall be deemed to comprise: (a) the
Initial Offer Hybridon Shares (b) the B Warrants only after such B
Warrants have been exercised at the discretion of the Directors (c) the
Secondary Offer Hybridon Shares (d) the D Warrants only after such D
Warrants have been exercised at the discretion of the Directors (e) all
cash on hand and on deposit, including any interest accrued thereon;
(f) all bills and demand notes and accounts receivable; (g) all
interest accrued on any interest-bearing Investments owned by the
Company (except interest accrued on Investments in default and interest
which is included in the quoted price); and (h) all other property of
every kind and nature including prepaid expenses as defined from time
to time by the Directors.
(5) The value of the assets of the Company shall be determined as
follows.
(a) Initial Offer Hybridon Shares: per the closing price
of the Initial Offer Hybridon Shares on a daily basis
on the market.
(b) Security Offer Hybridon Shares: per the closing price
of the Secondary Offer Hybridon Shares on a daily
basis on the market.
(c) The B Warrants and D Warrants: As there is currently
no trading in the B or D Warrants the B or D Warrants
have no value until they are exercised. The Directors
of the Company have a discretion when to exercise the
B or D Warrants in order to realise the value of such
B or D Warrants the Directors are under no obligation
to exercise all or any of these B and D Warrants at
any time other than at such time as the Directors
shall deem necessary. If and when the B and D
Warrants are exercised then the value of the B and D
Warrants is determined by subtracting the strike
price of the B or D Warrant from the closing market
price multiplied by the total number of B or D
Warrants. The B or D Warrants therefore have no value
unless Hybridon's stock closing price is higher than
the B or D Warrant's strike price and the Directors
decide to exercise them.
(c) The value of any cash on hand or on deposit, bills
and demand and promissory notes and accounts
receivable, prepaid expenses, cash dividends and
interest declared or accrued as aforesaid and not yet
received shall be deemed to be the full amount
thereof unless the Directors shall have determined
that any such deposit, bill, demand or promissory
note or account receivable or other amount is not
worth the full amount thereof, in which event the
value thereof shall be deemed to be such value as the
Directors with the approval of the Auditors shall
deem to be the reasonable value thereof.
23
(d) If, in valuing any asset of the Fund, the Directors
at any time consider that any of the above mentioned
bases of valuation are inapplicable or give rise to
an unfair value they shall be entitled to substitute
what in their opinion is a fair value therefor.
(6) The liabilities of the Company shall be deemed to comprise: (a) all
bills and accounts payable; (b) all administrative expenses payable
and/or accrued, including an appropriate provision for monthly and
annual management or other fees; (c) all contractual obligations for
the payment of money or property, including the amount of any unpaid
dividends declared upon the shares of the Company; (d) all provisions
authorised or approved by the Directors for taxes or contingencies; and
(e) all other liabilities of the Company of whatsoever kind and nature
except liabilities represented by share capital share premium account
and reserves of the Company.
(7) For the purposes of this article:
(a) Participating Shares of the Company for which
application has been made shall be deemed to be in
issue on the business day next following the day as
at which the Issue Price therefor shall be determined
and after such time the Issue Price thereof payable
to the Company if not received shall be deemed to be
an asset of the Company and any liabilities in
connection with the issue thereof shall be deemed to
be liabilities of the Company;
(b) Participating Shares of the Company to be redeemed
under article 35 hereof shall be deemed to be in
issue only until the time as at which the Redemption
Price is determined and from such time until paid the
price thereof shall be deemed to be a liability of
the Company;
(c) for the purpose of calculating the Net Asset Value
the value of the assets of the Company denominated in
a currency other than dollars shall be translated
into dollars at such rates of exchange and at such
times as the Directors shall consider appropriate and
equitable.
(8) the value of the assets of the company may be specially valued at
the discretion of the Directors in the following circumstances:-
(a) if the value of the MSCI World Index moves either up
or down by more than 50% since the last Valuation
Day;
(b) if the Manager receives an application for
subscription or redemption the value of which the
Directors at their absolute discretion determine is
such that a special valuation is appropriate; and/or
24
(c) where the Directors in their absolute discretion
determine it is in the best interests of the company
to do so.
REDEMPTION OF SHARES
35. (1) Subject as provided in this article and in articles 36 and 37 the
Company shall on receipt by it or its duly authorised agents of a
request by a Shareholder in writing or in such other form as the
Directors may from time to time determine for the redemption or
purchase of all or any Participating Shares held by him redeem such
shares, provided as follows.
(2) The redemption of Redeemable A Shares maybe made at any time
subject to these articles;
(i) The redemption of Redeemable A Shares pursuant to
this article shall be made at the request of a holder
of Redeemable A Shares on the Redemption Day next
following the expiry of not less than one weeks'
notice, or such shorter period as the Directors may
in their absolute discretion determine.
(ii) The Company shall be entitled to satisfy a request
for redemption wholly or partly by procuring the
transfer to the holder who has requested the
redemption the number of Initial Offer Hybridon
Shares held within Hybridon by the Company of which
the market value at the time of redemption is exactly
the equivalent to the Net Asset Value of the
Redeemable A Shares held by that shareholder within
the Company less the Initial Redemption Charge and
any further fees and expenses owing to the Company by
the said shareholder.
(iii) The minimum value of any redemption of the Redeemable
A Shares by any shareholder will be the equivalent
market value of US $100,000 of the Initial Offer
Hybridon Shares.
(iv) On redemption of part only of the Redeemable A shares
comprised in a certificate the Directors shall
procure a balance certificate to be issued free of
charge for the balance of such shares.
(v) The Directors may at their option dispense with the
production of any certificate which shall have become
lost, stolen or destroyed upon compliance by the
Shareholder with the like requirements to
25
those arising in the case of any application by him
for the replacement thereof as provided in article 19
hereof
(vi) Notice of redemption, once given, may only be
withdrawn in exceptional circumstances at the
discretion of and with the written approval of the
Directors.
(vii) If the determination of the Net Asset Value is
suspended beyond the day on which it would normally
occur by reason of a declaration by the Directors
suspending determination of the Net Asset Value
pursuant to paragraph (3) of article 34 hereof the
right of the Shareholder to have his Redeemable A
Shares redeemed pursuant to this article shall be
similarly suspended and during the period of
suspension he may withdraw his request for
redemption. Any withdrawal shall be in writing and
shall only be effective if actually received by the
Company before the termination of the period of
suspension. If the request is not so withdrawn, the
redemption of the Redeemable A Shares shall be made
on the Redemption Day next following the end of the
suspension.
(vii) The Shareholder shall forthwith after the giving of
the request for redemption hereunder forward to the
Company the certificate for the share to which such
request relates duly endorsed and the Company shall
not be bound to make any payment to any Shareholder
in respect of such redemption or purchase unless and
until the Directors shall have received from such
Shareholder the certificate for the Redeemable A
Shares being so redeemed or purchased.
(3) The redemption of Redeemable C Shares maybe made at any time
subject to these articles;
(i) The redemption of Redeemable C Shares pursuant to
this article shall be made at the request of a holder
of Redeemable C Shares on the Redemption Day next
following the expiry of not less than one weeks'
notice, or such shorter period as the Directors may
in their absolute discretion determine.
(ii) The Company shall be entitled to satisfy a request
for redemption wholly or partly by procuring the
transfer to the holder who has requested the
redemption the number of Secondary Offer Hybridon
Shares held within Hybridon by the Company of which
the market value at the time of redemption is exactly
the equivalent to the Net Asset Value of the
Redeemable C Shares held by that shareholder
26
within the Company less the Secondary Redemption
Charge and any further fees and expenses owing to the
Company by the said shareholder.
(iii) The minimum value of any redemption of the Redeemable
C Shares by any shareholder will be the equivalent
market value of US $100,000 of the Secondary Offer
Hybridon Shares.
(iv) On redemption of part only of the Redeemable C Shares
comprised in a certificate the Directors shall
procure a balance certificate to be issued free of
charge for the balance of such shares.
(v) The Directors may at their option dispense with the
production of any certificate which shall have become
lost, stolen or destroyed upon compliance by the
Shareholder with the like requirements to those
arising in the case of any application by him for the
replacement thereof as provided in article 19 hereof
(vi) Notice of redemption, once given, may only be
withdrawn in exceptional circumstances at the
discretion of and with the written approval of the
Directors.
(vii) If the determination of the Net Asset Value is
suspended beyond the day on which it would normally
occur by reason of a declaration by the Directors
suspending determination of the Net Asset Value
pursuant to paragraph (3) of article 34 hereof the
right of the Shareholder to have his Redeemable C
Shares redeemed pursuant to this article shall be
similarly suspended and during the period of
suspension he may withdraw his request for
redemption. Any withdrawal shall be in writing and
shall only be effective if actually received by the
Company before the termination of the period of
suspension. If the request is not so withdrawn, the
redemption of the Redeemable C Shares shall be made
on the Redemption Day next following the end of the
suspension.
(vii) The Shareholder shall forthwith after the giving of
the request for redemption hereunder forward to the
Company the certificate for the share to which such
request relates duly endorsed and the Company shall
not be bound to make any payment to any Shareholder
in respect of such redemption or purchase unless and
until the Directors shall have received from such
Shareholder the certificate for the Redeemable C
Shares being so redeemed or purchased.
27
(4) The redemption of Redeemable B Shares will be at the discretion of
the Directors and will only occur once the B Warrants held by the
Company have been exercised by the Directors of the Company. The B
Warrants will have no value and will not comprise an asset of the
Company until such B Warrants have been exercised at the discretion of
the Directors subject to these articles.
(i) Upon redemption of the Redeemable B Shares at the
discretion of the Directors the Company shall procur the
transfer of an amount of Initial Offer Hybridon Shares to the
Shareholders equivalent to the value of the B Warrants once
exercised less the Initial Redemption Charge or any other fees
and expenses owing by the Shareholder to the Company including
any further expenses incurred by the Company in exercising the
said B Warrants.
(5) The redemption of Redeemable D Shares will be at the discretion of
the Directors and will only occur once the D Warrants held by the
Company have been exercised by the Directors of the Company. The D
Warrants will have no value and will not comprise an asset of the
Company until such D Warrants have been exercised at the discretion of
the Directors subject to these articles.
(i) Upon redemption of the Redeemable D Shares at the
discretion of the Directors the Company shall procur the
transfer of an amount of Secondary Offer Hybridon Shares to
the Shareholders equivalent to the value of D Warrants once
exercised less the Redemption Charge or any other fees and
expenses owing by the Shareholder to the Company including any
further expenses incurred by the Company in exercising the
said D Warrants.
(6) The equivalent Net Asset Value for each of the Redeemable A Shares
on a Redemption Day as outlined in Article 35(2)(ii) shall be
calculated by:
(a) ascertaining the Net Asset Value on the relevant
Valuation Day;
(b) dividing the amount calculated under (a) above by the
number of Redeemable A Shares then in issue or deemed
to be in issue;
(c) deducting from the resultant amount an amount
equivalent to the nominal value of a Redeemable A
Shares; and
(d) adjusting the resulting sum downwards to the nearest
whole cent (the amount necessary to effect such
downward adjustment being payable to the Company for
its absolute use and benefit).
(7) The equivalent Net Asset Value for each of the Redeemable C Shares
on a Redemption Day as outlined in Article 35(2)(ii) shall be
calculated by:
28
(a) ascertaining the Net Asset Value on the relevant
Valuation Day;
(b) dividing the amount calculated under (a) above by the
number of Redeemable C Shares then in issue or deemed
to be in issue;
(c) deducting from the resultant amount an amount
equivalent to the nominal value of a Redeemable C
Shares; and
(d) adjusting the resulting sum downwards to the nearest
whole cent (the amount necessary to effect such
downward adjustment being payable to the Company for
its absolute use and benefit).
(8) The redemption of Redeemable A Shares under the provisions of this
article shall be deemed to be effected immediately after the time as at
which the share transfer of the Initial Offer Hybridon Shares is made
by the Company to the Shareholder who has requested the redemption in
accordance with the said provisions.
(9) The redemption of Redeemable B Shares under the provisions of this
article shall be deemed effected immediately after the time as at which
the Share transfer of the Initial Offer Hybridon Shares is made by the
Company to the relevant Shareholders upon the exercise of the D
Warrants by the Directors.
(10) The redemption of Redeemable C Shares under the provisions of this
article shall be deemed to be effected immediately after the time as at
which the share transfer of the Secondary Offer Hybridon Shares is made
by the Company to the Shareholder who has requested the redemption in
accordance with the said provisions.
(11) The redemption of Redeemable D Shares under the provisions of this
article shall be deemed effected immediately after the time as at which
the Share transfer of the Secondary Offer Hybridon Shares is made by
the Company to the relevant Shareholders upon the exercise of the D
Warrants by the Directors.
(12) Upon the redemption of the Participating Shares being effected the
Shareholder shall cease to be entitled to any rights in respect thereof
and accordingly his name shall be removed from the Register with
respect thereto and the share shall be available for re-issue and until
re-issued shall form part of the unissued capital of the Company.
36. The Company shall not be bound to redeem as at any Redemption Day more
than one-fifth of the number of Redeemable A Shares or Redeemable C
Shares then in issue. If the Company shall receive requests for the
redemption as at any Redemption Day of a greater number of Redeemable A
Shares or Redeemable C
29
Shares, it may scale down the number to be redeemed in response to each
request to such extent as may be necessary to ensure that the foregoing
limit is not exceeded and shall carry forward for redemption as at the
next following Redemption Day the balance of each request and so on to
each succeeding Redemption Day until each request has been complied
with in full, provided that requests for redemption which have been
carried forward from an earlier Redemption Day shall subject always to
the foregoing limits be complied with in priority to later requests.
37. The Directors may refuse any request for redemption of any Redeemable A
Shares or Redeemable C Shares or may by not less than four weeks'
notice expiring on a Redemption Day to all holders of Redeemable A
Shares on Redeemable C Shares on such Redemption Day all (but not some)
of the Redeemable A Shares or Redeemable C Shares not previously
redeemed if in the opinion of the Directors it is considered advisable
prudent or otherwise in the interest of the Shareholders so to do as a
result of any enactment legislation or other event or circumstances
whatsoever. In the event of any redemption hereunder the provisions of
this article shall apply as if such redemption had been made at the
request of the holders of the Redeemable A Shares or Redeemable C
Shares in question.
ALTERATION OF SHARE CAPITAL
38. The Company may from time to time by ordinary resolution increase its
capital by such sum to be divided into shares of such amounts as the
ordinary resolution shall prescribe. All new shares shall be subject to
the provisions of these articles with reference to payment of calls,
lien, transfer, transmission, forfeiture and otherwise.
39. Subject to and in accordance with the provisions of the Acts, the
Company may by special resolution from time to time reduce its share
capital in any way, and in particular, without prejudice to the
generality of the foregoing power may:
(1) extinguish or reduce the liability on any of its shares in respect
of share capital not paid up; or
(2) with or without extinguishing or reducing liability on any of its
shares:
(a) cancel any paid-up share capital which is lost or
which is not represented by available assets; or
(b) pay off any paid-up share capital which is in excess
of the requirements of the Company;
and may, if and so far as necessary, alter its memorandum of
association by reducing the amounts or its share capital and of its
shares accordingly.
30
40. Subject to and in accordance with the Acts, the Company may by ordinary
resolution from time to time alter its share capital by:
(1) consolidating and dividing all or any of its share capital into
shares of larger amount than its existing shares; or
(2) sub-dividing its shares, or any of them, into shares of smaller
amount than that fixed by its memorandum of association, however, so
that in the subdivision the proportion between the amount paid and the
amount, if any, unpaid on each reduced share shall be the same as it
was in the case of the share from which the reduced share is derived;
or
(3) cancelling any shares which, at the date of the passing of the
ordinary resolution in that behalf, have not been taken or agreed to be
taken by any person, and diminishing the amount of its share capital by
the amount of the shares so cancelled.
GENERAL MEETINGS
41. The Company shall in each year hold a general meeting as its annual
general meeting in addition to any other meeting in that year provided
that so long as the Company holds its first annual general meeting
within eighteen months of its incorporation it need not hold it in the
year of its incorporation or in the following year. Not more than
fifteen months shall elapse between the date of one annual general
meeting of the Company and that of the next. Subsequent annual general
meetings shall be held once in each year at such time and place in the
Island as may be determined by the Directors.
42. All general meetings (other than annual general meetings) shall be
called extraordinary general meetings and shall be held in the Island
or such other place outside the United Kingdom as the Directors may
select.
43. The Directors and the Custodian may call an extraordinary general
meetings whenever they think fit and extraordinary general meetings
shall be convened on such requisition or in such manner as provided by
the Acts.
NOTICE OF GENERAL MEETINGS
44. Twenty-one clear days' notice at least specifying the place, the day
and the hour of the meeting, and in the case of special business the
general nature of such business (and in the case of an annual general
meeting specifying the meeting as such) shall be given in the manner
hereinafter mentioned to such persons as are under the provisions of
these articles or the conditions of issue of the shares held by them
entitled to receive notices from the Company. There may be included in
any notice convening a meeting of the Company for the purpose of
passing a special
31
resolution a notice specifying the place, the day and the hour of a
subsequent meeting to be held subject to the passing of the special
resolution at the first meeting for the purpose of confirming such
special resolution in accordance with the provisions of the Acts.
45. A general meeting shall, notwithstanding that it is called by shorter
notice than specified in the last preceding article, be deemed to have
been duly called with regard to the length of notice it is so agreed by
all the Shareholders entitled to attend and vote thereat.
46. In every notice calling a meeting of the Company or of any class of
Shareholders of the Company, there shall appear with reasonable
prominence a statement that a Shareholder entitled to attend and vote
is entitled to appoint one or more proxies to attend and vote instead
of him and that a proxy need not also be a Shareholder.
47. The accidental omission to give notice to, or the non-receipt of notice
by, any person entitled to receive notice shall not invalidate the
proceedings at any general meeting.
PROCEEDINGS AT GENERAL MEETINGS
48. All business shall be deemed special that is transacted at an
extraordinary general meeting and also all business that is transacted
at an annual general meeting with the exception of declaring or
approving the payment of dividends, the consideration of the accounts
and balance sheet and the reports of the Directors and Auditors, the
election of Auditors in the place of those retiring and the appointment
and the fixing of the remuneration of the Directors and the Auditors.
49. No business shall be transacted at any general meeting unless a quorum
is present. Save as in these articles otherwise provided, two
Shareholders present in person or by proxy and entitled to vote shall
be a quorum for all purposes. A representative of a corporation
authorised pursuant to article 73 hereof and present at any meeting of
the Company or at any meeting of any class of Shareholders of the
Company shall be deemed to be a Shareholder for the purpose of counting
towards a quorum.
50 If within half an hour from the time appointed for the meeting a quorum
is not present, the meeting shall stand adjourned to the same day in
the next week, at the same time and place, and if at such adjourned
meeting a quorum is not present within fifteen minutes from the time
appointed for holding the meeting, the Shareholders present shall be a
quorum.
51. The chairman (if any) or, if absent, the deputy chairman (if any) of
the board of Directors or, failing him, some other Director nominated
by the Directors shall preside as chairman at every general meeting of
the Company but if at any meeting
32
neither the chairman nor the deputy chairman nor such other Director be
present within fifteen minutes after the time appointed for holding the
meeting, or if none of them is willing to act as chairman, the
Directors present shall choose some Director present to be chairman, or
if no Directors are present or if all the Directors present decline to
take the chair the Shareholders present shall choose a Shareholder
present to be chairman.
52. The chairman may with the consent of any meeting at which a quorum is
present (and shall if so directed by the meeting) adjourn the meeting
from time to time and from place to place but no business shall be
transacted at any adjourned meeting except business which might
lawfully have been transacted at the meeting from which the adjournment
took place.
53. When a meeting is adjourned for fourteen days or more, seven clear days
notice at the least, specifying the place, the day and the hour of the
adjourned meeting, shall be given as in the case of the original
meeting but it shall be given as in the case of the original meeting
but it shall not be necessary to specify in such notice the nature of
the business to be transacted at an adjourned meeting.
54. At any general meeting, a resolution put to the vote of the meeting
shall be decided on a show of hands unless before or upon the
declaration of the result of the show of hands a poll is demanded by
the chairman or by at least five Shareholders present and having the
right to vote at the meeting or by a Shareholder or Shareholders
present and representing not less than one-tenth of the total voting
rights of all Shareholders having the right to vote at the meeting.
Unless a poll is demanded, a declaration by the chairman that a
resolution has been carried, or carried unanimously, or carried by a
particular majority, or lost, or not carried by a particular majority
and an entry to that effect in the book containing the minutes of the
proceedings of the Company shall be conclusive evidence of the fact
without proof of the number of proportion of votes recorded in favour
of or against such resolution.
55. Subject always to the Acts, the instrument appointing a proxy to vote
at a meeting shall be deemed also to confer authority to demand or join
in demanding a poll, and for the purposes of the last preceding article
a demand by a person as proxy for a Shareholder shall be the same as a
demand by the Shareholder.
56. If a poll is duly demanded, it shall be taken, subject to article 57,
in such manner and at such place as the chairman may direct (including
the use of ballot or voting papers or tickets) and the result of a poll
shall be deemed to be the resolution of the meeting at which the poll
was demanded. The chairman, in the event of a poll, may appoint
scrutineers and may adjourn the meeting to some place and time fixed by
him for the purpose of declaring the result of the poll.
33
57. A poll demanded on the election of a chairman and a poll demanded on a
question of adjournment shall be taken forthwith. A poll demanded on
any other question shall be taken at such time and place as the
chairman directs, not being more than thirty days from the date of the
meeting or adjourned meeting at which the poll was demanded.
58. The demand for a poll shall not prevent the continuance of a meeting
for the transaction of any business other than the question on which
the poll has been demanded.
59. A demand for a poll may be withdrawn and no notice need be given of a
poll not taken immediately.
VOTES OF MEMBERS
60. Subject to any special rights or restrictions for the time being
attached to any class of shares:
(1) on a show of hands every Shareholder being the holder of a
Management Share who is present in person shall have one vote;
(2) on a poll every Shareholder being the holder of Management Shares
present in person or by proxy shall be entitled to one vote for every
share of which he is the holder;
(3) holders of Participating Shares shall not be entitled to vote at
general meetings save where a resolution is proposed: (i) to wind up
the Company; or (ii) to alter the investment policy of the Company, or
(iii) to issue shares other than as Management Shares or Participating
Shares, in which last event the consent of a separate class meeting of
holders of Participating Shares is also required; if holders of
Participating Shares are entitled to vote the provisions of article
60(1) and (2) shall apply, mutatis mutandis;
61. In the case of joint holders of a share, the vote of the senior who
tenders a vote, whether in person or by proxy, shall be accepted to the
exclusion of the votes of the other joint holders, and for this purpose
seniority shall be determined by the order in which the names stand in
the Register in respect of the share.
62. A Shareholder who has appointed special and general attorneys or a
Shareholder of unsound mind in respect of whom an order has been made
by any court having jurisdiction in lunacy, may vote, whether on a show
of hands or on a poll, by his said attorneys, committee, receiver, or
other person in the nature of a committee or receiver appointed by such
court, and such attorneys, committee, receiver, or other person may on
a poll vote by proxy, provided that such evidence as the Directors may
require of the authority of the person claiming to vote shall have been
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deposited at the registered office of the Company not less than
forty-eight hours before the time for holding the meeting or adjourned
meeting at which such person claims to vote.
63. No Shareholder shall, unless the Directors otherwise determine, be
entitled to vote at any general meeting, either personally or by proxy,
or to exercise any privileges as a Shareholder unless all calls or
other sums presently payable by him in respect of shares in the Company
of which he is the holder or one of the joint holders have been paid.
64. No objection shall be raised to the qualification of any voter except
at the meeting or adjourned meeting at which the vote objected to is
given or tendered and every vote not disallowed at such meeting shall
be valid for all purposes. Any such objection made in due time shall be
referred to the chairman of the meeting, whose decision shall be final
and conclusive.
65. On a poll, votes may be given either personally or by proxy.
66. On a poll, a Shareholder entitled to more than one vote need not, if he
votes, use all his votes or cast all the votes he uses in the same way.
67. The instrument appointing a proxy shall be in writing under the hand of
the appointor or of his attorney duly authorised or, if the appointor
is a corporation, either under its common seal or under the hand of an
officer or attorney so authorised.
68. Any person (whether a Shareholder of the Company or not) may be
appointed to act as a proxy. A Shareholder may appoint more than one
proxy to attend on the same occasion.
69. The instrument appointing a proxy and the power of attorney or other
authority (if any) under which it is signed or a notarially certified
copy of such power or authority shall be deposited at the registered
office of the Company, or at such other place as is specified for that
purpose in the notice of meeting or in the instrument of proxy issued
by the Company, not less than forty-eight hours before the time
appointed for holding the meeting or adjourned meeting at which the
person named in the instrument proposes to vote or in the case of a
poll not less than forty-eight hours before the taking of the poll, and
in default the instrument of proxy shall not be treated as valid. No
instrument appointing a proxy shall be valid after the expiration of
twelve months from the date named in it as the date of its execution,
except at an adjourned meeting or on a poll demanded at a meeting or an
adjourned meeting in cases where the meeting was originally held within
twelve months from such date.
70. An instrument of proxy shall be in such form as the Directors may
approve.
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71. The Directors may at the expense of the Company send by post or
otherwise to the Shareholders instruments of proxy (with or without
prepaid postage for their return) for use at any general meeting or at
any meeting of any class of Shareholders of the Company, either in
blank or nominating in the alternative any one or more of the Directors
or any other persons. If for the purpose of any meeting invitations to
appoint as proxy a person or one of a number of persons specified in
the invitations are issued at the expense of the Company, such
invitations shall be issued to all (and not to some only) of the
Shareholders entitled to be sent a notice of a meeting and vote thereat
by proxy.
72. A vote given in accordance with the terms of an instrument of proxy
shall be valid notwithstanding the death or insanity of the principal
or the revocation of the instrument of proxy, or of the authority under
which the instrument of proxy was executed, or the transfer of the
share in respect of which the instrument of proxy is given, provided
that no intimation in writing of such death, insanity, revocation or
transfer shall have been received by the Company at its registered
office before the commencement of the meeting or adjourned meeting at
which the instrument of proxy is used.
73. Any corporation which is a Shareholder of the Company may, by
resolution of its Directors or other governing body, authorise such
person as it thinks fit to act as its representative at any meeting of
the Company or at any meeting of any class of Shareholders of the
Company, and the person so authorised shall be entitled to exercise the
same powers on behalf of the corporation which he represents as that
corporation could exercise if it were an individual Shareholder of the
Company.
DIRECTORS
74. Subject to article 91 hereof, the number of the Directors shall not be
fewer than two. The first Directors shall be appointed in writing by a
majority of the subscribers to the memorandum of association. No person
shall be appointed as a Director under any provision of these articles
if his appointment would cause or permit the aggregate of the number of
Directors resident in the United Kingdom for the purposes of United
Kingdom taxation to constitute a majority of the Directors.
75. The Company may from time to time by ordinary resolution fix a maximum
number of Directors and increase or reduce the minimum number of
Directors.
76. The Directors shall have power at any time, and from time to time, to
appoint any person to be a Director, either to fill a casual vacancy or
as an additional Director, but so that the total number of Directors
shall not at any time exceed the number fixed in accordance with these
articles. Such Director shall hold office until the next following
annual general meeting.
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77. A Director need not be a Shareholder but each Director shall
nevertheless have the right to attend and speak at all general meetings
of the Company.
78. Each Director and alternate Director shall be entitled, by way of
remuneration, to such sum as the Directors may consider appropriate.
Their remuneration shall be deemed to accrue from day to day. The
Directors and alternate Directors may also be paid all travelling,
hotel and other expenses properly incurred by them in attending and
returning from meetings of the Directors of any committee of the
Directors or general meeting or class meetings of the Company or in
connection with the business of the Company.
79. Each Director shall have the power to appoint any person (including
another Director) to act as alternate Director in his place at any
meeting of the Directors at which he is unable to be present, and at
his discretion to revoke the appointment of such alternate Director
provided that no person who is resident in the United Kingdom for the
purposes of United Kingdom taxation may be appointed as an alternate
Director unless his appointor is also resident in the United Kingdom.
On such appointment being made the alternate Director shall (except as
regards the power to appoint an alternate Director) be subject in all
respects to the terms and conditions existing with reference to the
other Directors of the Company and each alternate Director, whilst
acting in the place of an absent Director, shall exercise and discharge
all the functions, powers and duties of the Directors he represents.
Any Director of the Company who is appointed as alternate Director
shall be entitled at a meeting of the Directors to cast a vote on
behalf of his appointor in addition to the vote to which he is entitled
in his own capacity as a Director of the Company, and also shall be
considered as two Directors for the purpose of making a quorum of
Directors when such quorum shall exceed two. Any person appointed as an
alternate Director shall vacate such office as such alternate Director
if and when the Director by whom he has been appointed shall die or
cease to hold the office of Director.
80. The appointment of an alternate Director and any revocation thereof
shall be given in writing and shall take effect when lodged or received
at the registered office of the Company.
81. The office of a Director shall be vacated in any of the following
events, namely:
(1) if he resigns his office by notice in writing signed by him and
left at the registered office;
(2) if he becomes bankrupt or makes any arrangement or composition with
his creditors generally;
(3) if he becomes of unsound mind;
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(4) if he is absent from meetings of the Directors for six successive
months without leave expressed by a resolution of the board of
Directors, and the Directors resolve that his office be vacated;
(5) if he ceases to be a Director by virtue of, or becomes prohibited
from being a Director by reason of, an order made under any provision
of any law or enactment;
(6) if he is requested by all the other Directors (not being less than
two in number) to vacate his office;
(7) if he becomes resident in the United Kingdom and as a result
thereof a majority of the Directors are resident in the United Kingdom;
(8) if he is removed from office pursuant to article 82 hereof
82. The Company may, by ordinary resolution, remove any Director before the
expiration of his period of office, and may, by ordinary resolution,
appoint another person in his stead.
83. (1) A Director may hold any other office or place of profit under the
Company (other than the office of Auditor) in conjunction with his
office of Director on such terms as to tenure of office, remuneration
and otherwise as the Directors may determine.
(2) (a) No Director or intending Director shall be
disqualified by his office from contracting with the
Company either as vendor, purchaser or otherwise, nor
shall any such contract or arrangement entered into
by or on behalf of the Company in which any Director
is in any way interested be liable to be avoided, nor
shall any Director so contracting or being so
interested be liable to account to the Company for
any profit realised by any such contract or
arrangement by reason of such Director holding that
office, or of the fiduciary relationship thereby
established, but the nature of his interest must be
declared by him at the meeting of the Directors at
which the question of entering into the contract or
arrangement is first taken in consideration, or if
the Director was not at the date of the meeting
interested in the proposed contract or arrangement
then at the next meeting of the Directors held after
he became so interested, and if the Director becomes
interested in a contract or arrangement after it is
made, then at the first meeting of the Directors held
after he becomes so interested.
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(b) A general notice in writing given to the Directors by
any Director to the effect that he is a shareholder
or member of any specified company or firm, and is to
be regarded as interested in any contract which may
thereafter be made with that company or firm, shall
(if such Director shall give the same at a meeting of
the Directors or shall take reasonable steps to
secure that the same is brought up and read at the
next meeting of the Directors after it is given) be
deemed a sufficient declaration of interest in
relation to any contract so made.
(3) Save as herein provided, a Director shall not vote in respect of
any contract or arrangement or any other proposal whatsoever in which
he has any material interest otherwise than by virtue of his interest
in shares or debentures or other securities of or otherwise in or
through the Company. A Director shall nevertheless be counted in the
quorum at a meeting at which matters upon which he is debarred from
voting are under consideration.
(4) A Director shall (in the absence of some other material interest
than is indicated below) be entitled to vote (and be counted in the
quorum) in respect of any resolution concerning any of the following
matters, namely:
(a) the giving of any security or indemnity to him in
respect of money lent or obligations incurred by him
at the request of or for the benefit of the Company
or any of its subsidiaries;
(b) the giving of any security or indemnity to a third
party in respect of a debt or obligation of the
Company or any of its subsidiaries for which he
himself has assumed responsibility in whole or in
part under a guarantee or indemnity or by the giving
of security;
(c) any proposal concerning an offer of shares or
debentures or other securities of or by the Company
or any of its subsidiaries for subscription or
purchase in which offer he is or is to be interested
as a participant in the underwriting or
sub-underwriting thereof;
(d) any proposal concerning any other company in which he
is interested, directly or indirectly and whether as
an officer or shareholder or otherwise howsoever,
provided that he is not the holder of or beneficially
interested in 1 per cent or more of any class of the
equity share capital of such company (or of any third
company through which his interest is derived) or of
the voting rights available to members of the
relevant company (any such interest being deemed for
the purposes of this article to be a material
interest in all circumstances).
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(5) Where proposals are under consideration concerning the appointment
(including fixing or varying the terms of appointment) of two or more
Directors or officers or employees with the Company or any company in
which the Company is interested, such proposals may be divided and
considered in relation to each Director separately and in such case
each of the Directors concerned (if not debarred from voting under
paragraph (4)(d) of this article) shall be entitled to vote in respect
of each resolution except that concerning his own appointment.
(6) If any question shall arise at any meeting as to the materiality of
a Director's interest or as to the entitlement of any Director to vote
and such question is not resolved by his voluntarily agreeing to
abstain from voting, such question shall be referred to the chairman of
the meeting and his ruling in relation to any other Director shall be
final and conclusive except in a case where the nature or extent of the
interests of the Directors concerned have not been fairly disclosed.
(7) The Company may by ordinary resolution suspend or relax the
provisions of this article to any extent or ratify any transactions not
duly authorised by reason of a contravention of this article.
(8) Any Director may act by himself or through his firm in a
professional capacity for the Company, and he or his firm shall be
entitled to remuneration for professional services as if he were not a
Director provided that nothing herein contained shall authorise a
Director or his firm to act as Auditors to the Company.
84. Any Director may continue to be, or become, a Director, managing
director, manager or other officer or shareholder of any other company
in which the Company may be interested, and (unless otherwise agreed)
no such Director shall be accountable for any remuneration or other
benefits received by him as a director, managing director, manager or
other officer or shareholder of any such other company. Subject to
article 83, the Directors may exercise the voting powers conferred by
the shares in any other company held or owned by the Company, or
exercisable by them as directors of such other company, in such manner
in all respects as they think fit (including the exercise thereof in
favour of any resolution appointing themselves or any of them
directors, managing directors, managers or other officers of such
company or voting providing for the payment of remuneration to the
directors, managing directors, managers or other officers of such
company).
POWER OF DIRECTORS
85. The business of the Company shall be managed outside the United Kingdom
by the Directors who may exercise all such powers of the Company as are
not by the Acts or by these articles required to be exercised by the
Company in general meeting, subject nevertheless to any regulations of
these articles, to the provisions
40
of the Acts, and to such regulations, being not inconsistent with the
aforesaid regulations or provisions, as may be prescribed by the
Company in general meeting, but no regulations made by the Company in
general meeting shall invalidate any prior act of the Directors which
would have been valid if such regulations had not been made. The
general powers given by this article shall not be limited or restricted
by any special authority or power given to the Directors by any other
article.
86. (1) The Directors shall have the power to appoint and, if at any time
required by any authority in the Island, shall appoint as Manager any
person, firm or corporation (other than a person, firm, or corporation
resident or carrying on business in the United Kingdom) to carry out
management and administrative duties outside the United Kingdom in
relation to the business of the Company upon such terms and at such
remuneration as the Directors may from time to time determine and to
remove from such appointment any Manager so appointed. The terms of
appointment of any Manager may authorise such Manager to appoint (with
or without powers of sub-delegation) any administrator, sub-managers,
nominees, agents or delegates at the expense of the Company or
otherwise. Any such person firm or corporation may also be appointed
and perform the duties of the Secretary.
(2) The terms of any agreement appointing a Manager pursuant to
paragraph (1) of this article may provide for such Manager to be paid
or to retain to the exclusion of the Company any fee commission
brokerage or other payment paid or allowed in respect of Investments in
which the Company shall invest.
(3) If any Manager appointed under this article ceases for any reason
to be the Manager and if the name of the Company incorporates or is
associated with the name of the Manager or its holding company then if
so required by the Manager in writing to the Company within thirty days
of such cessation the Directors shall promptly procure the convening of
all necessary general meetings of the Company to change its name so as
to ensure no association with the Manager or its holding company and
the Shareholders shall procure that all necessary resolutions are
passed thereat.
(4) Shareholders will be given at least one month's notice of any
change in the terms of the agreement under which the Company has
appointed the Manager.
87. The Directors may also from time to time and at any time by power of
attorney under the Seal, appoint any company, firm or person, or any
fluctuating body of persons, whether nominated directly or indirectly
by the Directors, to be the attorney or attorneys of the Company for
such purposes and with such powers authorities and discretions (not
exceeding those vested in or exercisable by the Directors under these
articles) and for such period and subject to such conditions as they
may think fit, and any power of attorney may contain such provisions
for
41
the protection and convenience of persons dealing with any such
attorneys as the Directors may think fit, and may also authorise any
such attorney to sub-delegate all or any of the powers, authorities and
discretions vested in him provided always that no such attorney or
attorneys shall pursuant to such power be resident within, or act in
connection with the business of the Company within, the United Kingdom.
88. All cheques, promissory notes, drafts, bills or exchange and other
negotiable or transferable instruments, and all receipts for moneys
paid to the Company shall be signed, drawn, accepted, endorsed or
otherwise executed, as the case may be, in such manner as the Directors
shall from time to time by resolution determine.
INVESTMENT OF THE COMPANY'S ASSETS
89. (1) The Directors may invest the funds of the Company as they think
fit.
(2) In connection with the acquisition or disposal of any Investment by
the Company the Directors shall be entitled to pay such fees,
commissions, brokerage and other payments whatsoever as the Directors
shall in their absolute discretion determine, such payment to be made
in such manner and out of such income or other assets of the Company as
the Directors shall in their absolute discretion determine and to be
disclosed in the audited accounts of the Company
(3) The principal objective of the Company, is to invest funds in
Hybridon in return for Hybridon Shares and Warrants or such other
investments as the Directors see fit from time to time.
(4) The Directors will apply whatever investment strategies they deem
appropriate under prevailing economic and market conditions to seek
increases in Net Asset Value, subject to the investment restrictions
set out below:
(a) The Company will not enter into stock lending
arrangements.
PROCEEDINGS OF DIRECTORS
90. The Directors may meet together for the despatch of business, adjourn
and otherwise regulate their meetings as they think fit. Meetings of
Directors may be held in any part of the world except in the United
Kingdom. Any decision reached or resolution passed by the Directors at
any meeting held in the United Kingdom shall be invalid and of no
effect. Questions arising at any meeting shall be determined by a
majority of votes. In case of an equality of votes the chairman shall
have a second or casting vote provided only that the chairman is not
resident in the United Kingdom for the purposes of United Kingdom
taxation. A Director may, and the Secretary on the requisition of a
Director shall, at any time summon a meeting of the Directors.
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91. The quorum necessary for the transaction of the business of the
Directors may be fixed by the Directors and unless so fixed at any
other number shall be two, provided that no such quorum shall include a
majority of Directors who are resident in the United Kingdom for the
purposes of United Kingdom taxation.
92. The continuing Directors or a sole continuing Director may act
notwithstanding any vacancies in their number, but if and so long as
the number of Directors is reduced below the minimum number fixed by or
in accordance with these articles, the continuing Directors or Director
may act for the purpose of filling up vacancies in their number or of
summoning general meetings of the Company but not for any other
purpose. If there be no Directors or Director able or willing to act,
then any two Shareholders may summon a general meeting for the purpose
of appointing Directors.
93. The Directors may from time to time elect and remove a chairman and, if
they think fit, a deputy chairman and determine the period for which
they respectively are to hold office. The chairman or, failing him, the
deputy chairman shall preside at all meetings of the Directors but if
there be no chairman or deputy chairman, or if at any meeting the
chairman or deputy chairman be not present within five minutes after
the time appointed for holding the same, the Directors present may
choose one of their number to be chairman of the meeting.
94. A resolution in writing signed by all the Directors for the time being
entitled to receive a notice of a meeting of the Directors shall be as
valid and effectual as a resolution passed at a meeting of the
Directors duly convened and held and may consist of several documents
in the like form each signed by one or more of the Directors. No
resolution in writing shall be valid if a majority of those signing
sign it within the United Kingdom.
95. A meeting of the Directors for the time being at which a quorum is
present shall be competent to exercise all powers and discretions; for
the time being exercisable by the Directors.
96. The Directors may delegate any of their powers to committees consisting
of such member or members of their body as they think fit. Any
committee so formed shall, in the exercise of the powers so delegated,
conform to any regulations that may be imposed on them by the
Directors, provided that no such committee shall meet in the United
Kingdom or consist of a majority in aggregate of Directors who are
resident in the United Kingdom for the purposes of United Kingdom
taxation nor shall any committee meeting be held at which any such
majority is present and, if any committee meeting is held in breach of
this proviso, any decision reached or resolution passed thereat shall
be invalid and of no effect.
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97. The meetings and proceedings of any such committee consisting of two or
more members shall be governed by the provisions of these articles
regulating the meetings and proceedings of the Directors so far as the
same are applicable and are not superseded by any regulations made by
the Directors under the last preceding article.
98. Subject to the provisions of these articles, all acts done by any
meeting of Directors, or of a committee of Directors, or by any person
acting as a Director, shall be valid, notwithstanding it be afterwards
discovered that there was some defect in the appointment of any such
Director or person acting as aforesaid, or that they or any of them
were disqualified, or had vacated office, or were not entitled to vote.
99. The Directors shall cause minutes to be made of:-
(1) all appointments of officers made by the Directors;
(2) the names of the Directors present at each meeting of the Directors
and of any committee of Directors;
(3) all resolutions and proceedings of all meetings of the company and
of the Directors and of committees of Directors.
Any such minutes, if purporting to be signed by the chairman of the
meeting at which the proceedings took place, or by the chairman of the
next succeeding meeting, shall be evidence of their proceedings.
100. A register of Directors' shareholdings shall be kept at the registered
office of the Company and shall be open to the inspection of any
Shareholder or holder of debentures of the Company between the hours of
10.00 am and 1.00 pm for a period beginning fourteen days before and
ending three days after each annual general meeting. The said register
shall also be produced at the Commencement of each annual general
meeting and shall remain open and accessible during the continuance of
the meeting to any person attending the meeting.
BORROWING POWERS
101. The Directors may exercise all the powers of the Company to borrow
money (including the power to borrow for the purpose of redeeming
shares) and to secure such borrowings in any manner and to issue
debentures and other securities, whether outright or as collateral
security for any debt, liability or obligation of the Company.
44
SECRETARY
102. The Secretary shall be appointed by the Directors upon such conditions
as the Directors may think fit save that it shall be a requirement of
each and every appointment that the Secretary shall not be resident in
the United Kingdom for the purpose of United Kingdom taxation or carry
on business in the United Kingdom and shall cease to hold office, if
subsequent to his appointment, he becomes so resident or starts so to
carry on business. Anything required or authorised to be done by or to
the Secretary may, if the office is vacant or there is for any other
reason no Secretary capable of acting, be done by or to any assistant
or deputy Secretary or if there is no assistant or deputy Secretary
capable of acting, by or to any person authorised generally and
specially in that behalf by the Directors, provided that any provisions
of these articles requiring or authorising a thing to be done by or to
a Director and the Secretary shall not be satisfied by its being done
by or to the same person acting both as Director and as, or in the
place of, the Secretary.
THE BANK
103. (1) The Directors shall appoint a corporation to act as a Bank and to
hold all the assets of the Company and perform such other duties upon
such terms as the Directors may from time to time with the agreement of
the Bank determine, provided that such Bank shall not be resident in
the United Kingdom for the purposes of United Kingdom taxation.
(2) In the event of the Bank desiring to retire and giving notice of
such desire to the Directors, the Directors shall use their best
endeavours to find a corporation willing to act as a Bank and upon
doing so the Directors shall appoint such corporation to act as a Bank
in place of the retiring Bank.
THE SEAL
104. The Directors shall provide for the safe custody of the Seal and the
Seal shall never be used except by the authority of a resolution of the
Directors or of a committee of the Directors authorised by the
Directors in that behalf. The Directors may from time to time make such
regulations as they see fit (subject to the provisions of these
articles relating to share certificates) determining the persons and
the number of such persons in whose presence the Seal shall be used,
and until otherwise so determined the Seal shall be affixed in the
presence of two Directors or of one Director and the Secretary, or some
other person duly authorised by the Directors.
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DIVIDENDS
105. (1) No dividend shall be payable except out of such funds as may
lawfully be distributed as dividend.
(2) No dividend shall be payable to the holders of the Management
Shares.
106. (1) The Directors shall from time to time pay such dividends including
interim dividends to the holders of Participating Shares as the
Directors shall consider appropriate. Any resolution of the Directors
declaring a dividend on the Participating Shares may specify that the
same should be payable to the persons registered as the holders of the
Participating Shares at the close of business on a particular date,
notwithstanding that it may be a date prior to that on which the
resolution is passed and thereupon the dividend shall be payable to
them in accordance with their respective holdings so registered, but
without prejudice to the rights inter se in respect of such dividend of
transferors and transferees of Participating Shares.
(2) Unless otherwise provided by the terms of issue, a Participating
Share in issue at the date of record for a dividend, if fully paid,
shall carry the right to the full amount of the dividend for the
relevant period and if not fully paid shall be entitled to an amount in
proportion to the amount paid up. No amount paid on a share in advance
of the date on which a call is payable shall be treated for the purpose
of this article as paid up on a share.
(3) For the purpose only of determining the amount to be declared by
way of dividend in respect of a Participating Share there shall be
deemed to be included in the profits of the Company available for
distribution by way of dividend the amount standing to the credit of
the Equalisation Account (if any) at the date by reference to which
such determination is made.
(4) On the occasion of the payment of a dividend to the holder of a
Participating Share in respect of which an Equalisation Payment has
been made and to whom a sum is payable in accordance with article
111(5) hereof the amount of the dividend payable to such holder shall
be reduced by the amount of such sum and if such sum is equal to the
dividend which would otherwise be payable no dividend shall be payable
on such Participating Share.
107. The Directors may deduct from the dividends payable to any Shareholder
such sums of money as may be due from him relation to the shares of the
Company.
108. The Company may transmit any dividend or other amount payable in
respect of any share by cheque or warrant sent by ordinary post or in
such other manner as a shareholder shall require and the Directors
shall approve to the registered address of the holder, or in the case
of joint holders, of one of them or to such person and
46
address as the holder or joint holders may direct, and shall not be
responsible for any loss arising in respect of such transmission.
109. No dividend or other distribution shall bear interest against the
Company.
110. The Directors may, with the sanction of the Company in general meeting
satisfy any dividend due to such holders in whole or in part by
distributing to them in specie any of the assets of the Company, and in
particular any shares or securities of other companies to which the
Company is entitled provided always that no such distribution shall be
made which would amount to a reduction of capital save with the
consents required by law.
SHARE PREMIUM AND RESERVE ACCOUNTS AND EQUALISATION ACCOUNT
111. (1) The Directors shall establish an account to be called the Share
Premium Account and shall carry to the credit of such account from time
to time a sum equal to the amount or value of the premium paid on the
issue of any share.
(2) The Directors may set aside out of the profits or gains of the
Company and carry to the credit of any reserve account such sums as
they think proper, which shall, at the discretion of the Directors, be
applicable for any purpose to which the profits or reserves may be
properly applied and pending such application may at the like
discretion either be employed in the business of the Company or be
invested in such manner as the Directors may from time to time think
fit.
(3) The Company shall at all times comply with the provisions of the
Acts in relation to the Share Premium Account and any premiums
attaching to shares and in relation to the redemption of the
Participating Shares.
(4) The Directors may at any time and from time to time as they shall
think fit open and operate an Equalisation Account and during any
period when such Equalisation Account is operative shall credit any
Equalisation Payment received in accordance with article 9(4) hereof to
such Equalisation Account provided that:
(a) subject as hereinafter provided such payments shall
be attributable to the holders for the time being of
the Participating Shares on account of which such
Equalisation Payments were paid and not refunded; and
(b) the Directors with the approval of the Auditors may
from time to time and at any time transfer to Share
Premium Account any moneys standing to the credit of
the Equalisation Account after reserving for all
payments to be made there from in accordance with the
provisions hereof.
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(5) Subject as hereinafter provided the holder for the time being of
the Participating Share in respect of which an Equalisation Payment was
paid on its issue shall be entitled to the payment of a sum from the
Equalisation Account on the occurrence of any of the following events
between the date of issue of the Participating Share and the date next
following such issue at which the Directors make a transfer from
Equalisation Account to Share Premium Account:
(a) the payment of dividends in accordance with article
106 hereof; or
(b) the winding up or dissolution of the Company in
accordance with articles 7,8, 130 and 131 hereof,
provided that if the Directors think fit and the Auditors agree all
such sums shall be paid at a rate or rates per Participating Share
ascertained by dividing the aggregate of all Equalisation Payments
standing to the credit of the Equalisation Account by the number of
Participating Shares in respect of which such sums are payable and
provided that in so doing such Participating Shares may be divided into
two or more groups issued within different periods of time as may be
selected by the Directors with the approval of the Auditors.
ACCOUNTS
112. The Directors shall cause to be kept proper accounts with respect to:
(1) all sums of money received and expended by the Company and the
matters in respect of which such receipt and expenditure take place;
(2) all sales and purchases made by the Company; and
(3) the assets and liabilities of the Company.
113. The books of account shall be kept at the registered office of the
Company, or at such other place outside the United Kingdom as the
Directors think fit and shall always be open to inspection by the
Directors. No Shareholder (other than a Director) shall have any right
of inspection of any account or book or document of the Company except
as conferred by the Acts or authorised by the Directors or by the
Company in general meeting.
114. The Directors shall from time to time, in accordance with the
provisions of the Acts, cause to be prepared and to be laid before the
Company in general meeting such profit and loss accounts, balance
sheets, group accounts (if any) and reports as are specified in the
Acts, made up to such date in each year as the Directors may determine
from time to time and in default of such determination made up to the
[30th September] in each year.
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115. A printed copy of every Directors' report and Auditors' report
accompanied by the balance sheet (including every document required by
Acts to be annexed thereto) and profit and loss account which are to be
laid before the Company in general meeting in accordance with article
114 shall not less than twenty-one days prior to the meeting be
delivered or sent by post to the registered address of every
Shareholder or holder of debentures of the Company and to the Auditors,
provided that this article shall not require a copy of these documents
to be sent to more than one of two or more joint Shareholders or joint
debenture holders. The required number of copies of each of the
above-mentioned documents shall at the same time be forwarded to the
secretary of any stock exchange upon which quotation for any shares of
the Company is for the time being granted in manner required by its
rules.
AUDIT
116. (1) The Company shall at each annual general meeting appoint an Auditor
or Auditors (who must be members of the Institute of Chartered
Accountants of England and Wales, or Scotland or of the Institute of
Certified Accountants) to hold office from the conclusion of that
meeting until the conclusion of the next annual general meeting.
(2) The first Auditors of the Company shall be appointed by the
Directors at any time before the first annual general meeting of the
Company and the Auditors so appointed shall hold office until the
conclusion of that meeting.
(3) The Directors may fill any casual vacancy in the office of
Auditors, but, while any such vacancy continues, the surviving or
continuing Auditors, if any, may act.
117. The remuneration of any Auditors appointed by the Directors shall be
fixed by the Directors and of any Auditors appointed by the Company
shall be fixed by the Company at the annual general meeting at which
such appointment shall be made or in such a manner as such meeting may
determine.
118. (1) The Auditors shall examine such books, account and vouchers as may
be necessary for the performance of their duties.
(2) The Auditors shall make a report to the Shareholders on the
accounts examined by them and on every balance sheet laid before the
Company in general meeting during their tenure of office and the report
shall state whether or not in their opinion the accounts give a true
and fair view of the state of the Company's affairs and the relevant
balance sheet date and of the net revenue of the Company for the period
ended on the relevant balance sheet date.
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119. The Auditors shall be furnished with a list of all books kept by the
Company and shall at all times have the right of access to the books
and accounts and vouchers of the Company, and shall be entitled to
require from the Directors and officers of the Company such information
and explanations as may be necessary for the performance of their
duties.
120. The Auditors shall be entitled to attend any annual general meeting of
the Company at which any accounts which have been examined or reported
on by them are to be laid before the Company and to, make any statement
or explanation they may desire with respect to the accounts, and
notices of every such meeting shall be given to the Auditors in the
manner prescribed for the Shareholders.
NOTICES
121. Any notice or document may be served by the Company on any Shareholder
either personally or by sending it through the post in a prepaid letter
addressed to such Shareholder at his address as appearing in the
Register. In the case of joint holders of a share, all notices shall be
given to that one of the joint holders whose name stands first in the
Register in respect of the joint holding, and notice so given shall be
sufficient notice to all joint holders.
122. Notices to be posted to addresses outside the Island shall so far as
practicable be forwarded by prepaid airmail.
123. Any Shareholder present, either personally or by proxy, at any meeting
of the Company shall for all purposes be deemed to have received due
notice of such meeting and, where requisite, of the purposes for which
such meeting was convened.
124. Any summons, request, notice, order or other document required to be
sent to or served upon the Company, or upon any office of the Company,
may be sent or served by leaving the same or sending it through the
post in a prepaid letter, envelope or wrapper, addressed to the Company
or to such officer at the registered office of the Company. The Company
shall be entitled to require that any request, notice, order or other
document required by or pursuant to these articles to be given in
writing by any Shareholder to the Company shall be signed by the
Shareholder by whom it is given.
125. Any notice or other document, if served by post, shall be deemed to
have been served seven days after the time the letter containing the
same is posted and in proving such service it shall be sufficient to
prove that the letter containing the notice or document was properly
addressed and duly posted. A notice given by advertisement shall be
published in a local newspaper circulating in the Island and at least
one daily newspaper in London with international circulation and shall
be deemed to have been served before noon on which the advertisement
appears.
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126. Any notice or document delivered or sent by post to or left at the
registered address of any Shareholder in pursuance of these articles
shall, notwithstanding that such Shareholder be then dead or bankrupt,
and whether or not the company has notice of his death or bankruptcy,
be deemed to have been duly served in respect of any share registered
in the name of such Shareholder as sole or joint holder, unless his
name shall, at the time of the service of the notice or document, have
been removed from the Register as the holder of the Share, and such
service shall for all purposes be deemed a sufficient service of such
notice or document on all persons interested (whether jointly with or
as claiming through or under him) in the share.
127. Notice of every general meeting shall be given in any manner
hereinbefore authorised to:
(1) every Shareholder;
(2) every Director of the Company; and
(3) the Auditors.
128. No other person shall be entitled to receive notices of general
meetings.
129. The directors shall give not less than sixty days' notice of any
proposed amendment to the Memorandum of Association of the Company and
these Articles, proposed changes to the investment policy, limits and
restrictions of the company, the appointment and/or removal of the
Custodian and any increase in the preliminary and preiodic charges of
the company to those persons whose names on the date the notice is
given appear as members in the share register of the company.
WINDING UP
130. If the Company shall be wound up the assets available for distribution
among the Shareholders shall be applied:
(1) first, in the repayment pari passu to the holders of Participating
Shares of the nominal amount paid up thereon;
(2) secondly, in the repayment pari passu to the holders of Management
Shares of the nominal amount paid up thereon; and
(4) thirdly, any surplus of assets then remaining shall be distributed
among the holders of the Participating Shares in accordance with the
provisions of article 7 and 8 hereof.
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131. If the company shall be wound up (whether the liquidation is voluntary,
or under supervision or by the court) the liquidator may, with the
authority of a special resolution, divide among the Shareholders in
specie the whole or any part of the assets of the Company, and whether
or not the assets shall consist of property of a single kind, and may
for such purposes set such value as he deems fair upon any one or more
class or classes of property, and may determine how such division shall
be carried out as between the Shareholders or different classes of
Shareholders. The liquidator may, with the like authority, vest any
part of the assets in trustees upon such trusts for the benefit of
Shareholders as the liquidator, with the like authority shall think
fit, and the liquidation of the Company may be closed and the Company
dissolved, but so that no Shareholder shall be compelled to accept any
shares in respect of which there is liability.
INDEMNITY
132. Every Director, Secretary and other officer or servant of the Company
shall be indemnified by the company against, and it shall be the duty
of the Directors out of the funds of the Company to pay all costs,
losses and expenses which any such officer or servant may incur or in
respect of which he may become liable by reason of any contract entered
into or act or thing done by him as such officer or servant or in any
way in discharge of his duties, including travelling expenses, and the
amount for which such indemnity is provided shall immediately attach as
a lien on the property of the Company and have priority as between the
Shareholders over all other claims.
133. No Director or other officer of the Company shall be liable for the
acts, receipts, neglects or defaults of any other Director or officer
or for joining in any receipt or other act for conformity or for any
loss or expense happening to the Company through the insufficiency or
deficiency of title to any property acquired by order of the Directors
for and on behalf of the Company or for the insufficiency or deficiency
of any Investment in or upon which any of the moneys of the Company
shall be invested or for any loss of any of the moneys of the Company
which shall be invested or for any loss or damage arising from the
bankruptcy, insolvency or tortious act of any person with whom any
money, Investments or effects shall be deposited, or for any loss,
damage or misfortune whatsoever which shall happen in the execution of
his respective office or in relation thereto unless the same happen
through his own wilful act or default or negligence.
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No. Names, Addresses and
Description of Subscribers
- ---------------------------------------------------------------------------
1. PILLAR INVESTMENT Limited
St James's Chambers
64a Athol Street
Douglas
Isle of Man
Youssef Mohamad Talaat El Zein
Director
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Dated this 10th day of June 2003
Witness to the above Signatures;-
Bialal Sidani
131 Avenue de Malakoff
75116-Paris
France
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