Exhibit 10.2

 

STOCK PURCHASE AGREEMENT

 

This Stock Purchase Agreement (this “Agreement”) is dated as of January 9, 2015,
between Agenus Inc., a Delaware corporation (the “Company”), and Incyte
Corporation, a Delaware corporation (the “Purchaser”).

 

WHEREAS, the Company, the Company’s wholly-owned subsidiary, 4-Antibody AG, a
joint stock company formed under the laws of Switzerland, Purchaser and Inctye
Europe SARL, a Swiss limited liability company (a société à responsabilité
limitée), entered into that certain License, Development and Commercialization
Agreement dated as of the date hereof (the “Collaboration Agreement”); and

 

WHEREAS, in connection with the execution of the Collaboration Agreement, the
Company desires to sell to Purchaser, and Purchaser desires to purchase from the
Company, shares of Common Stock of the Company in the amount and upon the terms
and conditions set forth in this Agreement.

 

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and Purchaser agree as
follows:

 

ARTICLE I.
DEFINITIONS

 

1.1                               Definitions.  In addition to the terms defined
elsewhere in this Agreement, for all purposes of this Agreement, the following
terms have the meanings set forth in this Section 1.1:

 

“Affiliate” means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a
Person as such terms are used in and construed under Rule 405 under the
Securities Act.

 

“Board of Directors” means the board of directors of the Company.

 

“Business Day” means any day except any Saturday, any Sunday, any day which is a
federal legal holiday in the United States or any day on which banking
institutions in the State of New York are authorized or required by law or other
governmental action to close.

 

“Closing” means the closing of the purchase and sale of the Shares pursuant to
Section 2.1.

 

“Closing Date” means the Trading Day on which all conditions precedent to
(i) Purchaser’s obligation to pay the Purchase Price and (ii) the Company’s
obligation to deliver the Shares, in each case, have been satisfied or waived,
but it no event later than the third Trading Day following the HSR Clearance
Date.

 

“Collaboration Agreement” has the meaning ascribed to such term in the preamble.

 

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“Commission” means the United States Securities and Exchange Commission.

 

“Common Stock” means the common stock of the Company, par value $0.01 per share,
and any other class of securities into which such securities may hereafter be
reclassified or changed.

 

“Common Stock Equivalents” means any securities of the Company which would
entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, right, option, warrant or other
instrument that is at any time convertible into or exercisable or exchangeable
for, or otherwise entitles the holder thereof to receive, Common Stock.

 

“Company Counsel” means Choate, Hall & Stewart LLP, with offices located at Two
International Place, Boston, MA 02110.

 

“Disclosure Schedules” means the schedules attached to this Agreement, as they
may be updated pursuant to Section 2.3(a).

 

“DOJ” means the United States Department of Justice.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

 

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

 

“FTC” means the United States Federal Trade Commission.

 

“GAAP” has the meaning ascribed to such term in Section 3.1(g).

 

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (15 U.S.C. §18a), and the rules and regulations promulgated thereunder.

 

“HSR Clearance” means the earlier of (a) notification to the Parties from the
FTC or DOJ of early termination of the applicable waiting period under the HSR
Act with respect to the HSR Filings, or (b) expiration of the applicable waiting
period under the HSR Act with respect to the HSR Filings; provided, however,
that if the FTC or DOJ shall commence any investigation by means of a second
request or otherwise, HSR Clearance means the termination of such investigation,
without action to prevent the Parties from implementing the transactions
contemplated by this Agreement with respect to the United States.

 

“HSR Clearance Date” means the earlier of (a) the date on which the FTC or DOJ
shall notify the Parties of early termination of the waiting period under the
HSR Act with respect to the HSR Filings, or (b) the date on which the applicable
waiting period under the HSR Act with respect to the HSR Filings expires;
provided, however, that if the FTC or DOJ shall commence any investigation by
means of a second request or otherwise, HSR Clearance Date means the date on
which any investigation opened by the FTC or

 

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DOJ shall have been terminated, without action to prevent the Parties from
implementing the transactions contemplated by this Agreement with respect to the
United States.

 

“HSR Filings” means the filings by the Parties with the FTC and the DOJ of their
respective premerger notification and report forms with respect to the matters
set forth in this Agreement and the Collaboration Agreement, together with all
required documentary attachments thereto.

 

“IFRS” has the meaning ascribed to such term in Section 3.1(g).

 

“Intellectual Property” means patents, patent applications, trademarks,
trademark applications, service marks, trade names, trade dress, trade secrets,
inventions and discoveries and invention disclosures whether or not patented,
copyrights in both published and unpublished works, including without limitation
all compilations, data bases and computer programs, materials and other
documentation, licenses, internet domain names and other intellectual property
rights and similar rights.

 

“Liens” means a lien, charge, pledge, security interest, encumbrance, right of
first refusal, preemptive right or other restriction.

 

“Lock-Up Period” has the meaning assigned to such term in Section 5.1(a).

 

“Material Adverse Effect” means any (i) material adverse effect on the legality,
validity or enforceability of this Agreement, (ii) material adverse effect on
the results of operations, assets, business or condition (financial or
otherwise) of the Company, taken as a whole, or (iii) material adverse effect on
the Company’s ability to perform in any material respect on a timely basis its
obligations under this Agreement.

 

“Nasdaq” means the NASDAQ Capital Market (or any successor thereto).

 

“Party” means any party to this Agreement.

 

“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.

 

“Purchase Price” has the meaning ascribed to such term in Section 2.1.

 

“Registration Statement” means the registration statement on Form S-3 (or any
successor form related to secondary offerings) required to be filed hereunder as
contemplated by Article 4, including the prospectus, amendments and supplements
to such registration statement or prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.

 

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended or interpreted from time to time, or
any

 

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similar rule or regulation hereafter adopted by the Commission having
substantially the same purpose and effect as such Rule.

 

“SEC Reports” has the meaning ascribed to such term in Section 3.1(g).

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

 

“Shares” has the meaning ascribed to such term in Section 2.1.

 

“Subsidiary” means the Company’s wholly-owned subsidiaries, as set forth on
Schedule 1.1.

 

“Trading Day” means a day on which Nasdaq is open for trading.

 

“Transfer Agent” means American Stock Transfer & Trust Company, LLC, the current
transfer agent of the Company, with a mailing address of 6201 15th Avenue,
Brooklyn, NY 11219 and a facsimile number of (718) 236-4588, and any successor
transfer agent of the Company.

 

“WilmerHale” means Wilmer Cutler Pickering Hale and Dorr LLP, with offices
located at 60 State Street, Boston, MA 02109.

 

ARTICLE II.
PURCHASE AND SALE

 

2.1                               Purchase and Sale of Shares; Closing.  Subject
to the terms and conditions of this Agreement, the Company agrees to sell to
Purchaser at the Closing, and Purchaser agrees to purchase from the Company at
the Closing, that certain number of whole shares of Common Stock (the “Shares”)
equal in value to, or as close as possible without exceeding, $35,000,000 (the
“Purchase Price”), each share valued at a price per share equal to the product
of (i) 1.2 and (ii) the simple average of the daily closing Volume Weighted
Average Price (VWAP) over the 20 Trading Days preceding the date of this
Agreement on the Nasdaq Stock Market as defined by Bloomberg.  Upon satisfaction
or waiver of the covenants and conditions set forth in Sections 2.3 and 2.4, the
Closing shall occur at the offices of WilmerHale or such other location as the
parties shall mutually agree.

 

2.2                               Condition Precedent.  The obligation of the
Company and Purchaser to enter into this Agreement is subject to the Company and
Purchaser having executed and delivered the Collaboration Agreement on or prior
to the date hereof.

 

2.3                               Deliveries at Closing.  At the Closing,
subject to the terms and conditions of this Agreement:

 

(a)                                 the Company shall deliver to Purchaser
updated Disclosure Schedules that update the Disclosure Schedules delivered as
of the date hereof for any matter or fact that arises at any time after the date
hereof and prior to the Closing Date that, if such matter or fact had been in
existence or had occurred at or before the date hereof, would have made

 

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a representation or warranty of the Company in Section 3.1 untrue had it not
been set forth or described in the Disclosure Schedules delivered on the date
hereof;

 

(b)                                 the Company shall deliver to Purchaser a
copy of the irrevocable instructions to the Transfer Agent instructing the
Transfer Agent to deliver the Shares to Purchaser on an expedited basis via The
Depository Trust Company’s Deposit and Withdrawal at Custodian system;

 

(c)                                  Company Counsel shall deliver to Purchaser
a legal opinion, substantially in the form of Exhibit A attached hereto; and

 

(d)                                 Purchaser shall pay to the Company, by wire
transfer of immediately available funds to an account or accounts designated by
the Company, the Purchase Price.

 

2.4                               Closing Conditions.

 

(a)                                 The obligation of the Company to sell the
Shares to Purchaser at the Closing is subject to the following conditions being
met or waived in writing by the Company:

 

(i)                                     the representations and warranties of
Purchaser contained in Section 3.2 shall be true and correct as of the date
hereof and as of the Closing Date;

 

(ii)                                  Purchaser shall have performed and
complied with all covenants, agreements, obligations and conditions contained in
this Agreement that are required to be performed or complied with by Purchaser
on or before the Closing;

 

(iii)                               the Collaboration Agreement shall continue
to be in full force and effect;

 

(iv)                              Purchaser shall have delivered the Purchase
Price; and

 

(v)                                 HSR Clearance shall have been obtained.

 

(b)                                 The obligation of Purchaser to purchase the
Shares at the Closing is subject to the following conditions being met or waived
in writing by the Purchaser:

 

(i)                                     the representations and warranties of
the Company contained in Section 3.1 that are qualified as to materiality shall
be true and correct as of the date hereof and as of the Closing Date, and those
that are not so qualified shall be true and correct as of the date hereof and
true and correct in all material respects as of the Closing Date (unless a
representation or warranty speaks as of the date hereof or another specific
date, in which case such representation or warranty shall be true and correct as
of the date hereof or such other specific date);

 

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(ii)                                  the Company shall have performed and
complied with all covenants, agreements, obligations and conditions contained in
this Agreement that are required to be performed or complied with by the Company
on or before the Closing;

 

(iii)                               the Company shall deliver to Purchaser a
certificate executed by an authorized officer of the Company confirming the
conditions set forth in Sections 2.4(b)(i) and (ii) have been duly satisfied;

 

(iv)                              the Collaboration Agreement shall continue to
be in full force and effect;

 

(v)                                 the Company shall have delivered the items
set forth in Section 2.3(a)-(b) of this Agreement;

 

(vi)                              Company Counsel shall have delivered the item
set forth in Section 2.3(c) of this Agreement;

 

(vii)                           there shall be no Material Adverse Effect with
respect to the Company existing as of the Closing;

 

(viii)                        from the date hereof to the Closing Date, trading
in the Common Stock shall not have been suspended by the Commission or Nasdaq;
and

 

(ix)                              HSR Clearance shall have been obtained.

 

2.5                               Effect of Waiver of Condition to Closing. In
the event that, as of the Closing, Purchaser expressly waives in writing the
condition regarding a Material Adverse Effect set forth in Section 2.4 of this
Agreement, Purchaser shall be deemed to have waived any right of recourse
against the Company for, and agreed not to sue the Company in respect of, any
and all events or inaccuracies in any representations or warranties of the
Company (a) that, as of the Closing, have caused or would reasonably be expected
to cause such Material Adverse Effect and (b) of which Purchaser had notice in
writing from the Company at least two (2) business days prior to the Closing.

 

ARTICLE III.
REPRESENTATIONS AND WARRANTIES

 

3.1                               Representations and Warranties of the
Company.  Except as set forth in the Disclosure Schedules, the Company hereby
represents and warrants to Purchaser as of the date hereof (unless specifically
made as of another date, in which case as of such other date) as follows:

 

(a)                                 Capitalization.  The capitalization of the
Company as of September 30, 2014 is as set forth on Schedule 3.1(a).  The
Company has not issued any capital stock since its most recently filed periodic
report under the Exchange Act, other than pursuant to the exercise of stock
options under the Company’s stock option plans, the issuance of shares of Common
Stock to employees pursuant to the Company’s employee stock

 

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purchase plans, the issuance of shares of Common Stock pursuant to the Company’s
at-the-market sales agreement and pursuant to the conversion and/or exercise of
Common Stock Equivalents outstanding as of the date of the most recently filed
periodic report under the Exchange Act.  No Person has any right of first
refusal, preemptive right, right of participation, or any similar right to
participate in the transactions contemplated by this Agreement.  Except as
disclosed on Schedule 3.1(a) and as a result of the purchase and sale of the
Shares, there are no outstanding options, warrants, scrip rights to subscribe
to, calls or commitments of any character whatsoever relating to, or securities,
rights or obligations convertible into or exercisable or exchangeable for, or
giving any Person any right to subscribe for or acquire, any shares of Common
Stock, or contracts, commitments, understandings or arrangements by which the
Company is or may become bound to issue additional shares of Common Stock or
Common Stock Equivalents.  The issuance and sale of the Shares will not obligate
the Company to issue shares of Common Stock or other securities to any Person
and will not result in a right of any holder of Company securities to adjust the
exercise, conversion, exchange or reset price under any of such securities. All
of the outstanding shares of capital stock of the Company are duly authorized,
validly issued, fully paid and nonassessable, have been issued in compliance
with all federal and state securities laws, and none of such outstanding shares
was issued in violation of any preemptive rights or similar rights to subscribe
for or purchase securities.  No further approval or authorization of any
stockholder, the Board of Directors or others is required for the issuance and
sale of the Shares.  There are no stockholders agreements, voting agreements or
other similar agreements with respect to the Company’s capital stock to which
the Company is a party or, to the knowledge of the Company, between or among any
of the Company’s stockholders.

 

(b)                                 Litigation.  There are no actions, suits,
proceedings or, to the knowledge of the Company, any investigations, pending or
currently threatened against the Company that questions the validity of this
Agreement or the issuance of the Shares contemplated hereby or would, if there
were an unfavorable decision, have or could reasonably be expected to result in
a Material Adverse Effect on the Company.  As of the date hereof, there is no
other material action, suit, or proceeding pending or, to the knowledge of the
Company, currently threatened in writing against the Company.  As of the date
hereof, there are no material outstanding consents, orders, decrees or judgments
of any governmental entity naming the Company.  Neither the Company, nor, to the
knowledge of the Company, any director or officer thereof, is or has been the
subject of any action involving a claim of violation of or liability under
federal or state securities laws or a claim of breach of fiduciary duty.  There
has not been, and to the knowledge of the Company, there is not pending or
contemplated, any investigation by the Commission involving the Company or any
current or former director or officer of the Company.  The Commission has not
issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company under the Exchange Act or the
Securities Act.

 

(c)                                  Organization and Good Standing.  The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all requisite corporate power
and authority to own, lease and operate its properties and carry on its business
as now conducted.  The Company is duly qualified

 

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and is in good standing as a foreign corporation in each jurisdiction in which
the properties owned, leased or operated, or the business conducted, by it
requires such qualification except where the failure to be so qualified or in
good standing, individually or in the aggregate, would not have a Material
Adverse Effect.

 

(d)                                 Authorization.  All corporate actions on the
part of the Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement and for the issuance of
the Shares have been taken.  The Company has the requisite corporate power to
enter into this Agreement and to carry out and perform its obligations
hereunder.  This Agreement has been duly authorized, executed and delivered by
the Company and, upon due execution and delivery by Purchaser, will be a valid
and binding agreement of the Company, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors’ rights generally or by equitable principles.

 

(e)                                  Subsidiaries.  All of the issued and
outstanding shares of capital stock of each Subsidiary are, where applicable,
validly issued, fully paid, non-assessable and free of preemptive and similar
rights to subscribe for or purchase securities.  Other than the Subsidiaries and
as otherwise set forth on Schedule 3.1(e), the Company does not currently own or
control, directly or indirectly, any interest in any other corporation,
partnership, trust, joint venture, limited liability company, association, or
other business entity.  Except as disclosed in the SEC Reports, the Company is
not a participant in any material joint venture, partnership or similar
arrangement.

 

(f)                                   No Conflict With Other Instruments. 
Neither the execution, delivery nor performance of this Agreement, nor the
issuance of the Shares contemplated hereby will result in (i) any violation of,
be in conflict with, cause any acceleration or any increased payments under, or
constitute a default under, with or without the passage of time or the giving of
notice: (a) any provision of the Company’s certificate of incorporation or
bylaws; (b) any provision of any judgment, decree or order to which the Company
is a party or by which it is bound; (c) any law, rule or regulation applicable
to the Company; or (d) any note, mortgage, material contract, material
agreement, license, waiver, exemption, order or permit; or (ii) the creation or
imposition of any lien, encumbrance, claim, security interest or restriction
whatsoever upon any of the material properties or assets of the Company or an
acceleration of indebtedness pursuant to any obligation, agreement or condition
contained in any material bond, debenture, note or any other evidence of
indebtedness or any material indenture, mortgage, deed of trust or any other
agreement or instrument to which the Company is a party or by which it is bound
or to which any of the material property or assets of the Company is subject.

 

(g)                                  Disclosure Documents.  For the two years
preceding the date hereof, the Company has filed, on a timely basis or has
received a valid extension as of such time of filing and has thereafter made
such filings prior to the expiration of any such extension, all reports,
schedules, forms, statements and other documents required to be filed by the
Company with the Commission under the Securities Act and the Exchange Act,
including pursuant to Section 13(a) or 15(d) thereof (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein,
being collectively referred to

 

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herein as the “SEC Reports”), and the Company has paid all fees and assessments
due and payable in connection with the SEC Reports.  As of their respective
dates, the SEC Reports complied in all material respects with all statutes and
applicable rules and regulations of the Commission, including the requirements
of the Securities Act and the Exchange Act, as applicable, and none of the SEC
Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The financial statements of the Company
included in the SEC Reports comply in all material respects with applicable
accounting requirements and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing.  Such financial statements
have been prepared in accordance with United States generally accepted
accounting principles (“GAAP”) or, to the extent applicable, the International
Financial Reporting Standards (“IFRS”), applied on a consistent basis during the
periods involved, except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP or IFRS, as applicable, and
fairly present in all material respects the financial position of the Company
and its consolidated Subsidiaries as of and for the dates thereof and the
results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit adjustments.

 

(h)                                 Absence of Certain Events and Changes. 
Except as otherwise disclosed in the SEC Reports, since the date of the
Company’s Quarterly Report on Form 10-Q for the quarter ended on September 30,
2014: (i) the Company has conducted its business in the ordinary course
consistent with past practice, (ii) there has not been any event, change or
development which, individually or in the aggregate, has had or could reasonably
be expected to have a Material Adverse Effect, (iii) the Company has not
incurred any material liabilities (contingent or otherwise) other than expenses
incurred in the ordinary course of business consistent with past practice,
(iv) the Company has not altered its method of accounting in any material
respect, and (v) the Company has not declared or made any dividend or
distribution of cash or other property to its shareholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital
stock.

 

(i)                                     Intellectual Property.  Except as
otherwise disclosed by the Company in writing to the Purchaser on or before the
date hereof, the Company owns, or has the right pursuant to a valid, written
license agreement to use and exploit, all Intellectual Property used in or
necessary for the conduct of the business of the Company and that is material to
the business of the Company as conducted as of the Closing (the “Company
Intellectual Property”). To the knowledge of the Company, (i) all issued patents
and registered trademarks that are Company Intellectual Property and that are
owned by the Company are valid and enforceable and are currently in compliance
with formal legal requirements (including without limitation, as applicable,
payment of filing, examination and maintenance fees, proofs of working or use,
timely post registration filing of affidavits of use and incontestability and
renewal applications), and (ii) there is no existing infringement or
misappropriation by another Person of any of the Company Intellectual Property. 
Except as disclosed in the SEC Reports, since January 1, 2012, no

 

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claims have been asserted by a third party in writing (a) alleging that the
conduct of the business of the Company has infringed or misappropriated any
Intellectual Property rights of such third party, or (b) challenging or
questioning the validity or effectiveness of any Intellectual Property right of
the Company, and, to the Company’s knowledge, there is no valid basis for any
such claim.  No loss or early expiration of any of the Company’s material
Intellectual Property is pending, or, to the Company’s knowledge, threatened. 
The Company has taken reasonable steps in accordance with standard industry
practices to protect its rights in the Company Intellectual Property and at all
times has maintained the confidentiality of all information used in connection
with the business that constitutes or constituted a trade secret of the Company.

 

(j)                                    Compliance.  The Company has all material
permits, licenses, franchises, authorizations, orders and approvals of
(collectively, “Permits”), and has made all filings, applications and
registrations with, governmental entities that are required in order to permit
the Company to own or lease its properties and assets and to carry on its
business as presently conducted.  Neither the sale of the Shares hereunder nor
the performance of the Company’s other obligations under this Agreement will
result in the suspension, revocation, impairment, forfeiture or nonrenewal of
any Permit applicable to the Company, its businesses or operations or any of its
assets or properties.  The Company has complied and is in compliance in all
material respects with all Permits, statutes, laws, regulations, rules,
judgments, orders and decrees of all governmental entities applicable to it that
relate to its business, including but not limited to compliance with the FCPA
and any applicable similar laws in foreign jurisdictions in which the Company is
currently, or has previously, conducted its business.  The Company has not
received any notice alleging noncompliance, and, to the knowledge of the
Company, the Company is not under investigation with respect to, or threatened
to be charged with, any material violation of any applicable statutes, laws,
regulations, rules, judgments, orders or decrees of any governmental entities. 
The Company has not received any notice of proceedings relating to the
revocation or modification of any Permit. No Permit is subject to termination as
a result of the execution of this Agreement or consummation of the transactions
contemplated hereby.  Except as disclosed in the SEC Reports, since January 1,
2012, the Company has not entered into or been subject to any judgment, consent
decree, compliance order or administrative order with respect to any aspect of
the business, affairs, properties or assets of the Company or received any
formal or informal complaint or claim from any regulatory agency with respect to
any aspect of the business, affairs, properties or assets of the Company.

 

(k)                                 Valid Issuance of Shares.  The Shares are
duly authorized and, when issued and paid for in accordance with this Agreement,
will be duly and validly issued, fully paid and nonassessable, free and clear of
all Liens imposed by the Company, and, based in part on the representations of
Purchaser in Section 3.2 of this Agreement, will be issued in compliance with
all applicable federal and state securities laws.  Neither the Company nor any
person acting on behalf of the Company has offered or sold any of the Shares by
any form of general solicitation or general advertising. The Company has offered
the Shares for sale only to the Purchaser.

 

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(l)                                     Governmental Consents.  No consent,
approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or local
governmental authority on the part of the Company is required in connection with
the consummation of the transactions contemplated by this Agreement, except for
(i) notices required or permitted to be filed with certain state and federal
securities commissions, which notices will be filed on a timely basis, and
(ii) the HSR Filings.

 

(m)                             No Brokers.  No broker, finder or investment
banker is entitled to any brokerage, finder’s or other fee or commission in
connection with the transactions contemplated by this Agreement based on
arrangements made by the Company.

 

(n)                                 No Undisclosed Liabilities. The Company does
not have any liabilities (contingent or otherwise), except for (i) liabilities
reflected or reserved against in financial statements of the Company (or
otherwise disclosed in the accompanying footnotes) included in the SEC Reports
filed with the Commission prior to the date of this Agreement, (ii) liabilities
incurred in the ordinary course of business or otherwise disclosed in SEC
Reports subsequent to the period covered by the Company’s Quarterly Report on
Form 10-Q for the quarter ended on September 30, 2014 and (iii) liabilities that
have not been and would not reasonably be expected to be material.

 

(o)                                 Internal Controls.  The Company has
implemented and maintains a system of internal control over financial reporting
(as required by Rule 13a-15(a) under the Exchange Act) that is designed to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of consolidated financial statements for external purposes,
and, to the knowledge of the Company, such system of internal control over
financial reporting is effective. For purposes of this Section 3.1(o),
“knowledge of the Company” means the actual knowledge of the Chief Executive
Officer and the Vice President, Finance of the Company. The Company has
implemented and maintains disclosure controls and procedures (as required by
Rule 13a-15(a) of the Exchange Act) that are designed to ensure that information
required to be disclosed by the Company in the reports it files or submits under
the Exchange Act is recorded, processed, summarized and reported within the
timeframes specified by the Commission’s rules and forms (and such disclosure
controls and procedures are effective), and has disclosed, based on its most
recent evaluation of its system of internal control over financial reporting
prior to the date of this Agreement, to the Company’s outside auditors and the
audit committee of the Company Board (i) any significant deficiencies and
material weaknesses known to it in the design or operation of its internal
control over financial reporting (as defined in Rule 13a-15(f) of the Exchange
Act) that would reasonably be expected to adversely affect the Company’s ability
to record, process, summarize and report financial information and (ii) any
fraud known to it, that involves management or other employees who have a
significant role in the Company’s internal control over financial reporting.

 

(p)                                 Company Not An “Investment Company.”  The
Company has been advised of the rules and requirements under the Investment
Company Act of 1940, as amended (the “Investment Company Act”). The Company is
not, and immediately after receipt of payment for the Shares will not be, an
“investment company” or an entity

 

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“controlled” by an “investment company” within the meaning of the Investment
Company Act.

 

(q)                                 Solvency.  The Company has not: (i) made a
general assignment for the benefit of creditors; (ii) filed any voluntary
petition in bankruptcy or suffered the filing of any involuntary petition by its
creditors; (iii) suffered the appointment of a receiver to take possession of
all, or substantially all, of its assets; (iv) suffered the attachment or other
judicial seizure of all, or substantially all, of its assets; (v) admitted in
writing its inability to pay its debts as they come due; or (vi) made an offer
of settlement, extension or composition to its creditors generally.

 

(r)                                    No Integrated Offering.  Neither the
Company, nor any of its Affiliates, nor any person acting on its or their behalf
has, directly or indirectly, made any offers or sales of any security or
solicited any offers to buy any security, under circumstances that would cause
this offering of the Shares to be integrated with prior offerings by the Company
for purposes of the Securities Act or any applicable shareholder approval
provisions, including, without limitation, under the rules and regulations of
any exchange or automated quotation system on which any of the securities of the
Company are listed or designated.

 

(s)                                   Whistleblowers.  To the knowledge of the
Company, as of the date hereof, no employee of the Company or its subsidiaries
has provided since January 1, 2012 or is providing information to any law
enforcement agency regarding the violation of any applicable Law of the type
described in Section 806 of the Sarbanes-Oxley Act by the Company or its
Subsidiaries.  Neither the Company nor its Subsidiaries have discharged, demoted
or suspended an employee of the Company or its Subsidiaries in the terms and
conditions of employment because of any lawful act of such employee described in
Section 806 of the Sarbanes-Oxley Act

 

3.2                               Representations and Warranties of Purchaser. 
Purchaser hereby represents and warrants to the Company as of the date hereof
(unless specifically made as of another date, in which case as of such other
date) as follows:

 

(a)                                 Legal Power.  Purchaser has the requisite
corporate power to enter into this Agreement and to carry out and perform its
obligations hereunder.

 

(b)                                 Due Execution.  This Agreement has been duly
authorized, executed and delivered by Purchaser, and, upon due execution and
delivery by the Company, will constitute a valid and legally binding obligation
of Purchaser, enforceable against Purchaser in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors’ rights generally or by equitable principles.

 

(c)                                  Investment Representations.  In connection
with the offer, purchase and sale of the Shares, Purchaser makes the following
representations:

 

(i)                                     Purchaser is acquiring the Shares for
its own account for the purpose of investment and not with a view to or for sale
in connection with any distribution

 

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thereof, and has no present intention to effect, or any present or contemplated
plan, agreement, undertaking, arrangement, obligation, indebtedness, or
commitment providing for, any distribution of the Shares.

 

(ii)                                  Purchaser has carefully reviewed the
representations concerning the Company contained in this Agreement and has made
detailed inquiry concerning the Company, its business and its personnel.

 

(iii)                               Purchaser understands that the Shares have
not been registered under the Securities Act or any applicable state securities
laws and, consequently, Purchaser may have to bear the risk of owning the Shares
for an indefinite period of time because the Shares may not be transferred
unless (x) the resale of the Shares is registered pursuant to an effective
registration statement under the Securities Act in accordance with the terms and
conditions set forth in Section 4.1 hereof; (y) Purchaser has delivered to the
Company an opinion of counsel (in form, substance and scope customary for
opinions of counsel in comparable transactions) to the effect that the Shares to
be sold or transferred may be sold or transferred pursuant to an exemption from
such registration; or (z) the Shares are sold or transferred pursuant to
Rule 144.

 

(iv)                              Purchaser has such knowledge and experience in
financial or business matters that it is capable of evaluating the merits and
risks of the investment in the Shares to be purchased hereunder.

 

(v)                                 Purchaser is an “accredited investor” as
defined in Rule 501(a) of the rules and regulations promulgated under the
Securities Act.

 

(d)                                 Certain Fees.  No broker, finder or
investment banker is entitled to any brokerage, finder’s or other fee or
commission in connection with the transactions contemplated by this Agreement
based on arrangements made by Purchaser.

 

(e)                                  Legends.  In connection with the issuance
and sale of the Shares, Purchaser understands that each of the Shares, whether
certificated or in book-entry form, will be endorsed with the following legend:

 

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN
STATES.  THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT
AND ANY APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY
TO THE COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

The Company acknowledges and agrees that the representations contained in
Section 3.2 shall not modify, amend or affect Purchaser’s right to rely on the
Company’s representations and warranties contained in this Agreement or any
representations and warranties contained in the

 

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Collaboration Agreement or any other document or instrument executed and/or
delivered in connection with this Agreement or the Collaboration Agreement or
the consummation of the transactions contemplated hereby.

 

ARTICLE IV.
REGISTRATION RIGHTS

 

4.1                               Registration of the Shares.  The Company shall
file with the Commission, on or before the date that is 90 days prior to the
first anniversary of the Closing Date, a Registration Statement covering the
resale of the Shares to the public by Purchaser.  The Company shall use
commercially reasonable efforts to cause the Registration Statement covering the
Shares to be declared effective by the Commission by the first anniversary of
the Closing Date.  The Company shall cause such Registration Statement to remain
effective under the Securities Act until all Shares covered by such Registration
Statement have been sold or may be sold without volume restrictions pursuant to
Rule 144.  The Company shall promptly notify Purchaser of the effectiveness of
such Registration Statement after the Company confirms effectiveness with the
Commission.  The Company hereby covenants and agrees to use reasonable
commercial efforts to maintain its eligibility to make filings with the
Commission on Form S-3 until one or more registrations statements covering the
resale of all of the Shares shall have been filed with, and declared effective
by, the Commission pursuant to the terms and conditions of this Agreement.

 

4.2                               Registration Covenant.  Purchaser covenants
and agrees that it will comply with the prospectus delivery requirements of the
Securities Act as applicable to it in connection with sales of the Shares
pursuant to a Registration Statement.  The Company shall comply in all material
respects with all applicable rules and regulations of the Commission applicable
to the filing of a Registration Statement.

 

4.3                               Registration Procedures.

 

(a)                                 In connection with the filing by the Company
of a Registration Statement covering the Shares, the Company shall furnish to
Purchaser (i) a copy of the prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act and (ii) such other
documents as Purchaser may reasonably request, in order to facilitate the public
sale or other disposition of the Shares.

 

(b)                                 The Company shall use commercially
reasonable efforts to register or qualify the Shares covered by a Registration
Statement under the securities laws of each state of the United States as
Purchaser shall reasonably request; provided, however, that the Company shall
not be required in connection with this subsection (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 Purchaser and after having done so the prospectus is
amended or supplemented to comply with the requirements of the Securities Act,
the Company shall promptly notify Purchaser and, if requested by the Company,
Purchaser shall immediately cease making offers or sales of the Shares covered
by a Registration Statement and return all prospectuses to the Company.  The
Company shall promptly provide Purchaser with revised or supplemented

 

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prospectuses and, following receipt of the revised or supplemented prospectuses,
Purchaser shall be free to resume making offers and sales of the Shares under
such Registration Statement.

 

(d)                                 The Company shall be entitled to include in
a Registration Statement the shares of Common Stock held by other shareholders
of the Company, provided such other shares of Common Stock are excluded first
from such Registration Statement in order to comply with any applicable laws or
request from any governmental entity or Nasdaq, or in the case of an
underwritten offering, in order to comply with a cutback request of any
underwriter.

 

(e)                                  The Company shall pay all expenses incurred
in connection with the preparation and filing of such Registration Statement
pursuant to this Article 4, including all registration and filing fees and
printer, legal and accounting fees related thereto but excluding (i) any
brokerage fees, selling commissions or underwriting discounts incurred by
Purchaser in connection with sales under any Registration Statement covering the
Shares and (ii) the fees and expenses of counsel retained by Purchaser.

 

(f)                                   The Company shall use commercially
reasonable efforts to avoid the issuance of any order suspending the
effectiveness of a Registration Statement, or any suspension of the
qualifications (or exemption from qualification) of any of the Shares covered by
a Registration Statement for sale in any jurisdiction.  The Company shall advise
Purchaser promptly after it shall receive notice of any stop order or issuance
of any order by the Commission delaying or suspending the effectiveness of a
Registration Statement covering the Shares or of the initiation of any
proceeding for that purpose, and it will promptly use commercially reasonable
efforts to prevent the issuance of any stop order or to obtain its withdrawal at
the earliest possible moment if such stop order should be issued.

 

4.4                               Registration Confidentiality.  Purchaser
agrees to treat as confidential (unless otherwise publicly disclosed by the
Company or a third party not to the knowledge of Purchaser in breach of an
agreement of confidentiality with the Company) any written notice from the
Company regarding the Company’s plans to file a Registration Statement and shall
not disclose such information to any other person, or use such information,
except as is necessary to exercise its rights under this Agreement.

 

4.5                               Indemnification.

 

(a)                                 The Company agrees to indemnify and hold
harmless Purchaser and each other person, if any, who controls Purchaser within
the meaning of the Securities Act or Exchange Act from and against any losses,
claims, damages or liabilities to which Purchaser 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 or proceedings in respect thereof) arise out of, or are
based upon any untrue statement of a material fact contained in any Registration
Statement covering the Shares or in any preliminary prospectus or final
prospectus contained in such Registration Statement, or any amendment or
supplement to such

 

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Registration Statement, or 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 Purchaser or controlling person
for any reasonable legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim, or
preparing to defend any such action, proceeding or claim; provided, however,
that the Company shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based upon, an untrue
statement made in such Registration Statement, preliminary prospectus or
prospectus, or any amendment or supplement in reliance upon and in conformity
with written information furnished to the Company by or on behalf of Purchaser
or controlling person specifically for use in the preparation thereof or any
statement or omission in any prospectus that is corrected in any subsequent
prospectus that was delivered to Purchaser prior to the pertinent sale or sales
by Purchaser.

 

(b)                                 Purchaser agrees to indemnify and hold
harmless the Company and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act, each officer of the Company who
signs the Registration Statement and each director of the Company, from and
against any losses, claims, damages or liabilities to which the Company or any
officer, director 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 or
proceedings in respect thereof) arise out of, or are based upon any untrue
statement of a material fact contained in any Registration Statement covering
the Shares or in any preliminary prospectus, final prospectus contained in such
Registration Statement, or any amendment or supplement to such Registration
Statement or the omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
if such untrue statement or omission was made in reliance upon and in conformity
with written information furnished by or on behalf of Purchaser specifically for
use in preparation of the Registration Statement, prospectus, amendment or
supplement and Purchaser will reimburse the Company, or such officer, director
or controlling person, as the case may be, for any legal or other expenses
reasonably incurred in investigating, defending or preparing to defend any such
action, proceeding or claim; provided, however, that Purchaser’s obligation to
indemnify the Company shall be limited to the Purchase Price.

 

(c)                                  Promptly after receipt by any indemnified
person of a notice of a claim or the beginning of any action in respect of which
indemnity is to be sought against an indemnifying person pursuant to this
Section 4.5, such indemnified person shall notify the indemnifying person in
writing of such claim or of the commencement of such action, but the omission to
so notify the indemnifying party will not relieve it from any liability which it
may have to any indemnified party under this Section 4.5 (except to the extent
that such omission materially and adversely affects the indemnifying party’s
ability to defend such action).  Subject to the provisions hereinafter stated,
in case any such action shall be brought against an indemnified person, the
indemnifying person shall be entitled to participate therein, and, to the extent
that it shall elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, shall
be entitled to assume the defense thereof, with counsel reasonably satisfactory

 

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to such indemnified person.  After notice from the indemnifying person to such
indemnified person of its election to assume the defense thereof, such
indemnifying person shall not be liable to such indemnified person for any legal
expenses subsequently incurred by such indemnified person in connection with the
defense thereof; provided, however, that if there exists or shall exist a
conflict of interest that would make it inappropriate, in the opinion of counsel
to the indemnified person, for the same counsel to represent both the
indemnified person and such indemnifying person or any Affiliate or associate
thereof, the indemnified person shall be entitled to retain its own counsel at
the expense of such indemnifying person; provided, however, that no indemnifying
person shall be responsible for the fees and expenses of more than one separate
counsel (together with appropriate local counsel) for all indemnified parties. 
In no event shall any indemnifying person be liable in respect of any amounts
paid in settlement of any action unless the indemnifying person shall have
approved the terms of such settlement; provided, however, that such consent
shall not be unreasonably withheld.  No indemnifying person shall, without the
prior written consent of the indemnified person, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified person is
or could have been a party and indemnification could have been sought hereunder
by such indemnified person, unless such settlement includes an unconditional
release of such indemnified person from all liability on claims that are the
subject matter of such proceeding.

 

(d)                                 If the indemnification provided for in this
Section 4.5 is unavailable to or insufficient to hold harmless an indemnified
party under subsection (a) or (b) above in respect of any losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) referred
to therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and Purchaser on
the other hand, in connection with the statements or omissions or other matters
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations.  The
relative fault shall be determined by reference to, among other things, in the
case of an untrue statement, whether the untrue statement relates to information
supplied by the Company on the one hand or Purchaser on the other hand and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement.  The Company and Purchaser agree that
it would not be just and equitable if contribution pursuant to this subsection
(d) were determined by pro rata allocation or by any other method of allocation
which does not take into account the equitable considerations referred to above
in this subsection (d).  The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim. 
Notwithstanding the provisions of this subsection (d), Purchaser shall not be
required to contribute any amount in excess of the amount by which the net
amount received by Purchaser from the sale of the Shares to which such loss
relates exceeds the amount of any damages which Purchaser has otherwise been
required to pay by reason of such untrue statement.  No person guilty of
fraudulent misrepresentation (within the

 

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meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

 

(e)                                  The rights and obligations of the Company
and Purchaser under this Section 4.5 shall survive the termination of this
Agreement.

 

ARTICLE V.
COVENANTS AND ADDITIONAL AGREEMENTS

 

5.1                               Stock Ownership Governance.

 

(a)                                 Lock-Up Period.  Excluding any transfers of
Shares between Purchaser and any of its Affiliates, during the twelve (12) month
period beginning on the Closing Date and ending on the first anniversary thereof
(the “Lock-Up Period”), Purchaser shall not, and shall not cause any other
holder of the Shares to, without the prior written consent of the Company, sell,
contract to sell, pledge or otherwise dispose of, directly or indirectly, any
Shares or enter into a transaction which would have the same effect.

 

(b)                                 Market Stand-Off Agreement.  During the
Lock-Up Period, Purchaser agrees that in connection with any registration of the
Company’s securities that, upon the request of the Company or the underwriters
managing any underwritten offering of the Company’s securities, Purchaser will
not sell, make any short sale of, loan, grant any option for the purchase of, or
otherwise dispose of any Shares without the prior written consent of the Company
or such underwriters, as the case may be, for such period of time within the
Lock-Up Period from the effective date of such registration as the Company or
the underwriters may specify.

 

(c)                                  Remedies.  Without prejudice to the rights
and remedies otherwise available to the parties, the Company shall be entitled
to equitable relief by way of injunction if Purchaser or any other holder of the
Shares breaches or threatens to breach any of the provisions of this
Section 5.1.

 

5.2                               Non-Public Information.  Except as
contemplated by the Collaboration Agreement, the Company covenants and agrees
that neither it, nor any other Person acting on its behalf will provide
Purchaser or its agents or counsel with any information that the Company
believes constitutes material non-public information, unless prior thereto
Purchaser shall have entered into a written agreement with the Company regarding
the confidentiality and use of such information.  The Company understands and
confirms that Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.

 

5.3                               Use of Proceeds.  The Company shall use the
net proceeds from the sale of the Shares hereunder for working capital purposes
and shall not use such proceeds: (a) for the redemption of any Common Stock or
Common Stock Equivalents, (b) for the settlement of any outstanding litigation
or (c) in violation of FCPA or regulations of the Office of Foreign Assets
Control of the U.S. Treasury Department.

 

5.4                               Listing of Common Stock, No Integrated
Offerings. The Company shall take no action designed to, or which to the
knowledge of the Company is likely to have the effect of,

 

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terminating the registration of the Common Stock under the Exchange Act.  The
Company hereby agrees to use commercially reasonable efforts to maintain the
listing of the Common Stock, including the Shares, on Nasdaq.  The Company
further agrees, if the Company applies to have the Common Stock traded on any
other trading market, it will include in such application all of the Shares, and
will take such other action as is necessary to cause all of the Shares to be
listed on such other trading market as promptly as possible.  The Company will
take all action reasonably necessary to continue the listing and trading of its
Common Stock, including the Shares, on Nasdaq and will comply in all material
respects with the Company’s reporting, filing and other obligations under the
bylaws or rules of Nasdaq.  The Company has taken no action designed to, or
which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act or delisting the Common
Stock from the Nasdaq National Market nor has the Company received in the past
twelve (12) months any notification that the Commission or the NASD is
contemplating terminating such registration or listing. The Company currently
meets the continuing eligibility requirements for listing on Nasdaq. The Company
has not, and to its knowledge no one acting on its behalf has, (i) taken,
directly or indirectly, any action designed to cause or to result in the
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of any of the Shares, (ii) sold, bid for,
purchased, or paid any compensation for soliciting purchases of, any of the
Shares, or (iii) paid or agreed to pay to any Person any compensation for
soliciting another to purchase any other securities of the Company. The Company
agrees to file with the Commission in a timely manner all reports and other
filings required of the Company under the Securities Act and the Exchange Act. 
The Company shall not sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in Section 2 of the Securities
Act) that would be integrated with the offer or sale of the Shares in a manner
that would require the registration under the Securities Act of the sale of the
Shares to the Purchaser or that would be integrated with the offer or sale of
the Shares for purposes of the rules and regulations of Nasdaq.

 

5.5                               Notification under the HSR Act.  Both Parties
shall promptly file (and, in any event, within seven (7) Business Days after the
date hereof) the HSR Filings with the FTC and the DOJ pursuant to the HSR Act.
The Parties shall use their commercially reasonable efforts to promptly obtain
HSR Clearance for the consummation of this Agreement and the Collaboration
Agreement and the transactions contemplated hereby and thereby and shall keep
each other apprised of the status of any communications with, and any inquiries
or requests for additional information from, the FTC and the DOJ and shall
comply promptly with any such inquiry or request; provided, however, that
neither Party shall be required to consent to the divestiture or other
disposition of any assets (including the assets of any Affiliate of either
Party) or to consent to any other structural or conduct remedy, and each Party
and its Affiliates shall have no obligation to contest or settle,
administratively or in court, any ruling, order or other action of the FTC or
DOJ or any Third Party respecting the transactions contemplated by this
Agreement or the Collaboration Agreement. The Parties shall instruct their
respective counsel to cooperate with each other and use their commercially
reasonable efforts to facilitate and expedite the identification and resolution
of any such issues and, consequently, the expiration of the applicable HSR Act
waiting period.  Each Party’s counsel will undertake (i) to keep each other
appropriately informed of communications from and to personnel of the reviewing
antitrust authority, and (ii) to confer with each other regarding appropriate
contacts with and responses to personnel of the FTC or DOJ.  Purchaser shall be
responsible for any filing fees in connection with the HSR Filings.

 

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ARTICLE VI.
MISCELLANEOUS

 

6.1                               Termination.  This Agreement may be terminated
at any time prior to Closing:

 

(a)                                 by mutual written consent of Purchaser and
the Company;

 

(b)                                 by Purchaser or the Company:

 

(i)                                     if there shall be any statute, law,
regulation or rule that makes consummating the transactions contemplated hereby
to be illegal or if any government or any court of competent jurisdiction,
administrative agency or commission or other governmental authority or agency,
federal, state, local or foreign shall have issued a judgment, order, decree or
ruling, or shall have taken such other action restraining, enjoining or
otherwise prohibiting the issuance of the Shares contemplated hereby and such
judgment, order, decree or ruling shall have become final and non-appealable;

 

(ii)                                  if the HSR Clearance Date shall not have
occurred on or before the date that is ninety (90) days after the Parties make
their respective HSR Filings pursuant to Section 5.5; or

 

(iii)                               if the Collaboration Agreement shall have
terminated.

 

(c)                                  by Purchaser:

 

(i)                                     if the Company shall have (A) failed to
perform any of its material obligations contained herein, or (B) breached any of
its material representations or warranties contained herein, provided that
Purchaser gives the Company written notice of such failure to perform or breach
and the Company does not cure such failure to perform or breach within thirty
(30) days after its receipt of such written notice;

 

(ii)                                  if any of the conditions set forth in
Section 2.4(b) shall become impossible to fulfill (other than as a result of any
breach by Purchaser of the terms of this Agreement) and shall not have been
waived in accordance with the terms of this Agreement; or

 

(iii)                               if the Common Stock shall no longer be
listed for trading on Nasdaq or another national securities exchange or
automated quotation system.

 

(d)                                 by the Company:

 

(i)                                     if Purchaser shall have (A) failed to
perform any of its material obligations contained herein, or (B) breached any of
its material representations or warranties contained herein, provided that the
Company gives Purchaser written notice of such failure to perform or breach and
Purchaser does not cure such failure to perform or breach within thirty (30)
days after its receipt of such written notice; or

 

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(ii)           if any of the conditions set forth in Section 2.4(a) shall become
impossible to fulfill (other than as a result of any breach by the Company of
the terms of this Agreement) and shall not have been waived in accordance with
the terms of this Agreement.

 

(e)           If this Agreement is terminated and the transactions contemplated
hereby are not consummated as described above, this Agreement shall become void
and of no further force and effect, provided, however, that (i) none of the
parties hereto shall have any liability in respect of a termination of this
Agreement pursuant to Section 6.1(a) or 6.1(b)(i) or 6.1(b)(ii), and
(ii) nothing shall relieve any of the parties from liability for actual damages
resulting from a termination of this Agreement pursuant to Section 6.1(c) or
6.1(d); and provided, further, that none of the parties hereto shall have any
liability for speculative, indirect, unforeseeable or consequential damages or
lost profits resulting from any legal action relating to any termination of this
Agreement.

 

6.2          Publicity.  The Parties shall issue a press release, in the form
attached as Exhibit B, within one (1) Business Day after the date hereof, to
announce the execution of this Agreement and describe the material financial and
operational terms of this Agreement.  Except as required by judicial order or
applicable Law, or as set forth below, neither Party shall make any public
announcement concerning this Agreement without the prior written consent of the
other Party, which consent shall not be unreasonably withheld or delayed.  The
Party preparing any such public announcement shall provide the other Party with
a draft thereof at least three (3) Business Days prior to the date on which such
Party would like to make the public announcement.  Neither Party shall use the
name, trademark, trade name or logo of the other Party or its employees, in any
publicity or news release relating to this Agreement or its subject matter,
without the prior express written permission of the other Party. Notwithstanding
the terms of this Section 6.2, either Party shall be permitted to disclose the
existence and terms of this Agreement to the extent required, based on the
advice of such Party’s legal counsel, to comply with applicable Laws, including
the rules and regulations promulgated by the Commission or any other
governmental authority.  Notwithstanding the foregoing, before disclosing this
Agreement or any of the terms hereof pursuant to this Section 6.2, the Parties
will consult with one another on the terms of this Agreement for which
confidential treatment will be sought in making any such disclosure.  If a Party
wishes to disclose this Agreement or any of the terms hereof in accordance with
this Section 6.2, such Party agrees, at its own expense, to seek confidential
treatment of the portions of this Agreement or such terms as may be reasonably
requested by the other Party; provided that the disclosing Party shall always be
entitled to comply with legal requirements, including the requirements of the
Commission.  Either Party may also disclose the existence and terms of this
Agreement in confidence to its attorneys and advisors, and to potential
acquirors (and their respective professional advisors), in connection with a
potential merger, acquisition or reorganization and to existing and potential
investors or lenders of such Party, as a part of their due diligence
investigations, or to existing and potential sublicensees or to permitted
sublicensees and assignees, in each case under an agreement to keep the terms of
this Agreement confidential under terms of confidentiality and non-use
substantially no less rigorous than the terms contained in this Agreement and to
use such information solely for the purpose permitted pursuant to this
Section 6.2.

 

For purposes of clarity, either Party may issue a press release or public
announcement or make such other disclosure if the content of such press release,
public announcement or disclosure has

 

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previously been made public other than through a breach of this Agreement by the
issuing Party or its Affiliates.

 

6.3          Fees and Expenses.  Each party shall pay the fees and expenses of
its advisers, counsel, accountants and other experts, if any, and all other
expenses incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement.  The Company shall pay
all Transfer Agent fees (including, without limitation, any fees required for
same-day processing of any instruction letter delivered by the Company and any
exercise notice delivered by Purchaser), stamp taxes and other taxes and duties
levied in connection with the delivery of any Shares to Purchaser.

 

6.4          Entire Agreement.  This Agreement, together with the exhibits and
schedules hereto, contains the entire understanding of the parties with respect
to the subject matter hereof and supersedes all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into this Agreement.

 

6.5          Notices.  Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of: (a) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
set forth below at or prior to 5:30 p.m. (New York City time) on a Trading Day,
(b) the next Trading Day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth below
on a day that is not a Trading Day or later than 5:30 p.m. (New York City time)
on any Trading Day, (c) the second (2nd) Trading Day following the date of
mailing, if sent by U.S. nationally recognized overnight courier service or
(d) upon actual receipt by the party to whom such notice is required to be
given.  The address for such notices and communications shall be as set forth
below:

 

If to the Company:

 

Agenus Inc.

3 Forbes Road

Lexington, Massachusetts 02421-7305, USA

Attention:  General Counsel

Facsimile:  (781) 674-4200

 

with a copy to:

 

Choate, Hall & Stewart LLP

Two International Place

Boston, Massachusetts 02110, USA

Attention:  Gerald E. Quirk, Esq.

Facsimile:  (617) 248-4000

 

If to Purchaser:

 

Incyte Corporation

1801 Augustine Cut-Off

 

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Wilmington, Delaware 19803, USA

Attention:  General Counsel

Facsimile: (302) 425-2707

 

with a copy to:

WilmerHale

60 State Street

Boston, Massachusetts 02109, USA

Attention: Steven D. Singer, Esq.

Facsimile: (617) 526-5000

 

6.6          Amendments; Waivers.  No provision of this Agreement may be waived,
modified, supplemented or amended except in a written instrument signed by the
Company and Purchaser.  No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any
other provision, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner impair the
exercise of any such right.

 

6.7          Headings.  The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.

 

6.8          Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted assigns. 
The Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of Purchaser (other than by merger). 
Purchaser may assign any or all of its rights under this Agreement to any Person
to whom Purchaser assigns or transfers any Shares, provided that such transferee
agrees in writing to be bound, with respect to the transferred Shares, by the
provisions of this Agreement that apply to “Purchaser.”

 

6.9          No Third-Party Beneficiaries.  This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.5.

 

6.10        Governing Law.  This Agreement shall in all respects be governed by
and construed in accordance with the laws of the State of Delaware, USA,
including all matters of construction, validity and performance, in each case
without reference to any conflict of law rules that might lead to the
application of the laws of any other jurisdiction.

 

6.11        Survival of Representation and Warranties.  The representations and
warranties contained herein shall survive the Closing and the delivery of the
Shares.

 

6.12        Execution in Counterparts.  This Agreement may be executed in two or
more counterparts, all of which when taken together shall be considered one and
the same agreement and shall become effective when counterparts have been signed
by each party and delivered to

 

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each other party, it being understood that the parties need not sign the same
counterpart.  In the event that any signature is delivered by facsimile
transmission or by e-mail delivery of a “.pdf” format data file, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile or “.pdf” signature page were an original thereof.

 

6.13        Severability.  If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.

 

6.14        Replacement of Securities.  If any certificate or instrument
evidencing any of the Shares is mutilated, lost, stolen or destroyed, the
Company shall issue or cause to be issued in exchange and substitution for and
upon cancellation thereof (in the case of mutilation), or in lieu of and
substitution therefor, a new certificate or instrument, but only upon receipt of
evidence reasonably satisfactory to the Company of such loss, theft or
destruction.  The applicant for a new certificate or instrument under such
circumstances shall also pay any reasonable third-party costs (including
customary indemnity) associated with the issuance of such replacement Shares.

 

6.15        Remedies.  In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, Purchaser and
the Company will be entitled to specific performance under this Agreement.  The
parties agree that monetary damages may not be adequate compensation for any
loss incurred by reason of any breach of obligations contained in this Agreement
and hereby agree to waive and not to assert in any action for specific
performance of any such obligation the defense that a remedy at law would be
adequate.

 

6.16        Saturdays, Sundays, Holidays, etc. If the last or appointed day for
the taking of any action or the expiration of any right required or granted
herein shall not be a Business Day, then such action may be taken or such right
may be exercised on the next succeeding Business Day.

 

6.17        Construction. The parties agree that each of them and/or their
respective counsel have reviewed and had an opportunity to revise this Agreement
and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement or any amendments hereto. In addition,
each and every reference to share prices and shares of Common Stock in this
Agreement shall be subject to adjustment for reverse and forward stock splits,
stock dividends, stock combinations and other similar transactions of the Common
Stock that occur after the date of this Agreement.

 

6.18        WAIVER OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING IN ANY
JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH
KNOWINGLY AND INTENTIONALLY, TO THE

 

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GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

 

(Signature Pages Follow)

 

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IN WITNESS WHEREOF, the parties hereto have caused this Stock Purchase Agreement
to be duly executed by their respective authorized signatories as of the date
first indicated above.

 

 

AGENUS INC.

 

 

 

 

 

 

By:

/s/ Garo H. Armen

 

 

Name:

Garo H. Armen

 

 

Title:

Chief Executive Officer

 

 

 

 

 

INCYTE CORPORATION

 

 

 

 

 

 

By:

/s/ Hervé Hoppenot

 

 

Name:

Hervé Hoppenot

 

 

Title:

President and Chief Executive Officer

 

 

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Exhibit A

 

Form of Opinion of Company Counsel

 

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Exhibit A

                 , 2015

 

Incyte Corporation

1801 Augustine Cut-Off

Wilmington, Delaware 19803

 

Ladies and Gentlemen:

 

This opinion letter is furnished to you pursuant to Section 2.3(c) of the Stock
Purchase Agreement, dated January 9, 2015 (the “Purchase Agreement”), between
Incyte Corporation, a Delaware corporation (“you”), and Agenus Inc., a Delaware
corporation (the “Company”), in connection with the offer and sale to you of an
aggregate of 7,763,968 shares (the “Shares”) of Common Stock, $0.01 par value
per share (the “Common Stock”).

 

We have acted as counsel to the Company in connection with the offer and sale of
the Shares.  For purposes of the following opinions, we have examined the
Purchase Agreement and have made such examination of law as we have deemed
necessary or appropriate. In our examination of documents, we have assumed the
authenticity of all documents submitted to us as originals and the conformity to
original documents of all documents submitted to us as conformed or copies, the
genuineness of all signatures, the legal capacity of all natural persons, and
the completeness and accuracy of the corporate records and stock books of the
Company provided to us.

 

Insofar as the opinions hereinafter expressed in this opinion letter relate to
factual matters, we have relied, with your permission, upon certificates,
statements and representations of officers and other representatives of the
Company, certificates of public officials and representations made in the
Purchase Agreement.  For purposes of this opinion letter, we have assumed that
all such statements and representations are also true as of the date hereof.

 

We direct your attention to the fact that our opinions are limited in scope
consistent with the Legal Opinion Principles issued by the Committee on Legal
Opinions of the American Bar Association’s Business Law Section as published in
53 Business Lawyer 831 (May, 1998).

 

Our opinion set forth in paragraph 1 below as to the valid existence and good
standing of the Company in the State of Delaware is based solely upon a
certificate dated January 6, 2015 from the Secretary of State of the State of
Delaware, and such opinion is, accordingly, rendered as of the date of such
certificate.  Our opinion set forth in paragraph 1 below as to the good standing
of the Company and qualification of the Company to conduct business in the
Commonwealth of Massachusetts is based solely upon a certificate dated
January 5, 2015 from the Secretary of the Commonwealth of the Commonwealth of
Massachusetts, and such opinion is, accordingly, rendered as of the date of such
certificate.  Finally, our opinion set forth in

 

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paragraph 1 that each of the subsidiaries of the Company is a corporation
validly existing under the laws of its state of organization is based solely
upon a certificate of an officer of the Company.

 

We express no opinion herein as to the applicability or effect of the laws of
any state or jurisdiction other than the laws of the Commonwealth of
Massachusetts, the Delaware General Corporation Law and the federal law of the
United States of America that, in our experience, are applicable to transactions
of the type contemplated in the Purchase Agreement.  We express no opinion with
respect to the effect of the laws of any other jurisdiction on the transactions
contemplated by the Purchase Agreement. We note that the Purchase Agreement
provides that it shall be governed by and construed in accordance with the
internal laws of the State of Delaware and that we are not rendering any opinion
herein with respect to Delaware law (except as otherwise stated above). 
Therefore, we are rendering our opinions herein as to the Purchase Agreement in
the event a court determines that the substantive law of Massachusetts, rather
than Delaware, should be applied (as to which application of law we express no
opinion).  We express no opinion as to the application of or compliance with the
securities and Blue Sky laws of any state, the by-laws and rules of the
Financial Industry Regulatory Authority, Inc. or the rules of the Nasdaq Capital
Market in connection with the transactions contemplated by the Purchase
Agreement.

 

Our opinion that the Purchase Agreement is enforceable against the Company in
accordance with its terms is qualified to the extent that enforcement of the
rights and remedies created thereby is subject to bankruptcy and similar laws of
general applicability affecting the rights and remedies of the contracting
parties, and to the extent that the availability of the remedy of specific
performance or of injunctive relief is subject to the discretion of the court
before which any proceeding therefor may be brought.

 

Based upon and subject to the foregoing and to the last paragraph of this
opinion letter, we are of the opinion that:

 

1.                                      The Company is a corporation validly
existing and in corporate good standing under the laws of the State of
Delaware.  The Company has all requisite corporate power to own and operate its
properties and assets and to carry on its business as now conducted (all as
described in the Company’s Annual Report on Form 10-K for its fiscal year ended
December 31, 2013). The Company is duly qualified to transact business and is in
good standing in the Commonwealth of Massachusetts.  Each of the subsidiaries of
the Company is a corporation validly existing under the laws of its state of
organization.

 

2.                                      The Company has all requisite power and
authority to (i) execute, deliver and perform the Purchase Agreement, (ii) to
issue, sell and deliver the Shares pursuant to the Purchase Agreement, and
(iii) to carry out and perform its obligations under, and to consummate the
transactions contemplated by, the Purchase Agreement.

 

3.                                      All action on the part of the Company,
its directors and its stockholders necessary for the authorization, execution
and delivery by the Company of the Purchase

 

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Agreement and the authorization, issuance, sale and delivery of the Shares
pursuant to the Purchase Agreement has been duly taken.  The Purchase Agreement
has been duly and validly executed and delivered by the Company and constitutes
the legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms.

 

4.                                      The Shares have been duly authorized
and, assuming payment therefor in accordance with the Purchase Agreement, are
validly issued, fully paid and nonassessable, are free of preemptive or similar
rights, and have been issued in compliance with applicable securities laws,
rules and regulations.  The rights, privileges and preferences of the Common
Stock are as stated in the Company’s Amended and Restated Certificate of
Incorporation, as amended to date (the “Corporate Charter”).

 

5.                                      Assuming the accuracy of, all the
representations made by you in the Purchase Agreement, the Company has complied
with, or is exempt from, all registration requirements of applicable federal
securities laws in connection with the issuance and sale of the Shares.

 

6.                                      The execution, delivery and performance
by the Company of, and the compliance by the Company with the terms of, the
Purchase Agreement and the issuance, sale and delivery of the Shares pursuant to
the Purchase Agreement do not (a) conflict with or result in a violation of any
provision of law, rule or regulation or any rule or regulation applicable to the
Company or its subsidiaries or of the Corporate Charter or by-laws of the
Company, (b) conflict with, result in a breach of or constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or result in or permit the termination or modification of, any agreement,
instrument, order, writ, judgment or decree known to us to which the Company of
its subsidiaries is a party or is subject or (c) result in the creation or
imposition of any lien, claim or encumbrance on any of the assets or properties
of the Company or its subsidiaries.

 

7.                                      In connection with the valid execution,
delivery and performance by the Company of the Purchase Agreement, or the offer,
sale, issuance or delivery of the Shares, no consent, license, permit, waiver,
approval or authorization of, or designation, declaration, registration or
filing with, any court, governmental or regulatory authority, or self-regulatory
organization, is required which has not been made or obtained.

 

Except as specifically stated herein, we render no opinion on matters relating
to the Purchase Agreement or the transactions contemplated thereby.  This
opinion letter is given and speaks only as of the date hereof and is limited to
our knowledge of the facts and the laws, statutes, rules and regulations, and
judicial and administrative interpretations thereof, as currently in effect, and
assumes no event will take place in the future which will affect the opinions
set forth herein.  These are all subject to change, possibly with retroactive
effect.  We assume no obligation to advise you of changes of any kind that may
hereafter be brought to our attention,

 

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even if such changes would affect our opinion, or to update or supplement this
opinion letter after the date hereof.  This opinion letter is furnished to you
solely and is solely for your benefit.  This opinion letter is not to be made
available to or relied upon by any other persons, firms or entities without our
prior written consent.  This opinion letter may not be copied, used, quoted,
disseminated or circulated in whole or in part.

 

 

Very truly yours,

 

 

 

 

 

CHOATE, HALL & STEWART LLP

 

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Exhibit B

 

Press Release

 

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