Exhibit 10.5

 

THRESHOLD PHARMACEUTICALS, INC.

Common Stock
(par value $0.001 per share)

At Market Issuance Sales Agreement

August 1, 2014

MLV & Co. LLC

1251 Avenue of the Americas, 41st Floor

New York, NY 10020

Ladies and Gentlemen:

Threshold Pharmaceuticals, Inc., a Delaware corporation (the “Company”),
confirms its agreement (this “Agreement”) with MLV & Co. LLC (the “MLV”), as
follows:

1.     Issuance and Sale of Shares.  The Company agrees that, from time to time
during the term of this Agreement, on the terms and subject to the conditions
set forth herein, it may issue and sell through MLV, shares (the “Placement
Shares”) of the Company’s common stock, par value $0.001 per share (the “Common
Stock”) up to an aggregate offering price of $30,000,000; provided however, that
in no event shall the Company issue or sell through MLV such number of Placement
Shares that (a) would cause the Company to not satisfy the eligibility
requirements for use of Form S-3 (including, if applicable, Instruction I.B.6.
thereof), (b) exceeds the amount of Placement Shares registered on the effective
Registration Statement and included in the Prospectus Supplement (each as
defined below) pursuant to which the offering is being made or (c) exceeds the
number of authorized but unissued shares of the Company’s Common Stock (the
lesser of (a), (b) and (c), the “Maximum Amount”).  Notwithstanding anything to
the contrary contained herein, the parties hereto agree that compliance with the
limitations set forth in this Section 1 on the amount of Placement Shares issued
and sold under this Agreement shall be the sole responsibility of the Company
and that MLV shall have no obligation in connection with such compliance.  The
issuance and sale of Placement Shares through MLV will be effected pursuant to
the Registration Statement (as defined below) filed by the Company and declared
effective by the Securities and Exchange Commission (the “Commission”), although
nothing in this Agreement shall be construed as requiring the Company to use the
Registration Statement to issue any Common Stock.

The Company has filed, in accordance with the provisions of the Securities Act
of 1933, as amended (the “Securities Act”) and the rules and regulations
thereunder (the “Securities Act Regulations”), with the Commission a
registration statement on Form S-3 (File No.333-195084), including a base
prospectus, relating to certain securities, including the Placement Shares to be
issued from time to time by the Company, and which incorporates by reference
documents that the Company has filed or will file in accordance with the
provisions of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and the rules and regulations thereunder (the “Exchange Act
Regulations”).  The Company has prepared a prospectus supplement specifically
relating to the Placement Shares (the “Prospectus Supplement”) to the base
prospectus included as part of such registration statement.  The Company will
furnish to MLV, for use by MLV,

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copies of the prospectus included as part of such registration statement, as
supplemented by the Prospectus Supplement, relating to the Placement
Shares.  Except where the context otherwise requires, such registration
statement, including all documents filed as part thereof or incorporated by
reference therein, and including any information contained in a Prospectus (as
defined below) subsequently filed with the Commission pursuant to Rule 424(b)
under the Securities Act Regulations or deemed to be a part of such registration
statement pursuant to Rule 430B of the Securities Act Regulations, is herein
called the “Registration Statement.”  The base prospectus, including all
documents incorporated therein by reference, included in the Registration
Statement, as it may be supplemented by the Prospectus Supplement, in the form
in which such prospectus and/or Prospectus Supplement have most recently been
filed by the Company with the Commission pursuant to Rule 424(b) under the
Securities Act Regulations, is herein called the “Prospectus”.  Any reference
herein to the Registration Statement, the Prospectus or any amendment or
supplement thereto shall be deemed to refer to and include the documents
incorporated by reference therein, and any reference herein to the terms
“amend,” “amendment” or “supplement” with respect to the Registration Statement
or the Prospectus shall be deemed to refer to and include the filing after the
execution hereof of any document with the Commission deemed to be incorporated
by reference therein (the “Incorporated Documents”).

For purposes of this Agreement, all references to the Registration Statement,
the Prospectus or to any amendment or supplement thereto shall be deemed to
include the most recent copy filed with the Commission pursuant to its
Electronic Data Gathering Analysis and Retrieval System, or if applicable, the
Interactive Data Electronic Application system when used by the Commission
(collectively, “EDGAR”).

2.     Placements.  Each time that the Company wishes to issue and sell
Placement Shares hereunder (each, a “Placement”), it will notify MLV by email
notice (or other method mutually agreed to in writing by the Parties) of the
number of Placement Shares, the time period during which sales are requested to
be made, any limitation on the number of Placement Shares that may be sold in
any one day and any minimum price below which sales may not be made (a
“Placement Notice”), the form of which is attached hereto as Schedule 1.  The
Placement Notice shall originate from any of the individuals from the Company
set forth on Schedule 3 (with a copy to each of the other individuals from the
Company listed on such schedule), and shall be addressed to each of the
individuals from MLV set forth on Schedule 3, as such Schedule 3 may be amended
from time to time.  The Placement Notice shall be effective unless and until
(i) MLV declines to accept the terms contained therein for any reason, in its
sole discretion, (ii) the entire amount of the Placement Shares thereunder have
been sold, (iii) the Company suspends or terminates the Placement Notice or (iv)
the Agreement has been terminated under the provisions of Section 13.  The
amount of any discount, commission or other compensation to be paid by the
Company to MLV in connection with the sale of the Placement Shares shall be
calculated in accordance with the terms set forth in Schedule 2.  It is
expressly acknowledged and agreed that neither the Company nor MLV will have any
obligation whatsoever with respect to a Placement or any Placement Shares unless
and until the Company delivers a Placement Notice to MLV and MLV does not
decline such Placement Notice pursuant to the terms set forth above, and then
only upon the terms specified therein and herein.  In the event of a conflict
between the terms of this Agreement and the terms of a Placement Notice, the
terms of the Placement Notice will control.

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3.     Sale of Placement Shares by MLV. Subject to the terms and conditions of
this Agreement, MLV, for the period specified in the Placement Notice, will use
its commercially reasonable efforts consistent with its normal trading and sales
practices and applicable state and federal laws, rules and regulations and the
rules of NASDAQ (the “Exchange”), to sell the Placement Shares up to the amount
specified, and otherwise in accordance with the terms of such Placement
Notice.  MLV will provide written confirmation to the Company no later than the
opening of the Trading Day (as defined below) immediately following the Trading
Day on which it has made sales of Placement Shares hereunder setting forth the
number of Placement Shares sold on such day, the compensation payable by the
Company to MLV pursuant to Section 2 with respect to such sales, and the Net
Proceeds (as defined below) payable to the Company, with an itemization of the
deductions made by MLV (as set forth in Section 5(b)) from the gross proceeds
that it receives from such sales.  Subject to the terms of the Placement Notice,
MLV may sell Placement Shares by any method permitted by law deemed to be an “at
the market” offering as defined in Rule 415 of the Securities Act Regulations,
including without limitation sales made directly on the Exchange, on any other
existing trading market for the Common Stock or to or through a market
maker.  Subject to the terms of a Placement Notice and only with the Company’s
prior written consent, MLV may also sell Placement Shares by any other method
permitted by law, including but not limited to in privately negotiated
transactions.  “Trading Day” means any day on which Common Stock are purchased
and sold on the Exchange.  Neither MLV nor any of its affiliates or subsidiaries
shall engage in (i) any short sale of any security of the Company, (ii) any sale
of any security of the Company that MLV does not own or any sale which is
consummated by the delivery of a security of the Company borrowed by, or for the
account of, MLV or (iii) any market-making, bidding, stabilization or other
trading activity with respect to the Common Stock or related derivative
securities if such activity would be prohibited under Regulation M or other
anti-manipulation rules under the Securities Act.  Neither MLV nor any of its
affiliates or subsidiaries, shall engage in any proprietary trading or trading
for MLV’s (or its affiliates’ or subsidiaries’) own account.

4.     Suspension of Sales.  The Company or MLV may, upon notice to the other
party in writing (including by email correspondence to each of the individuals
of the other Party set forth on Schedule 3, if receipt of such correspondence is
actually acknowledged by any of the individuals to whom the notice is sent,
other than via auto-reply) or by telephone (confirmed immediately by verifiable
facsimile transmission or email correspondence to each of the individuals of the
other Party set forth on Schedule 3), suspend any sale of Placement Shares;
provided, however, that such suspension shall not affect or impair any party’s
obligations with respect to any Placement Shares sold hereunder prior to the
receipt of such notice.  Each of the parties agrees that no such notice under
this Section 4 shall be effective against any other party unless it is made to
one of the individuals named on Schedule 3 hereto, as such Schedule may be
amended from time to time.

5.     Sale and Delivery to MLV; Settlement.

(a)     Sale of Placement Shares.  On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, upon MLV’s acceptance of the terms of a Placement Notice, and unless the
sale of the Placement Shares described therein has been declined, suspended, or
otherwise terminated in accordance with the terms of this Agreement, MLV, for
the period specified in the Placement Notice, will use its

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commercially reasonable efforts consistent with its normal trading and sales
practices to sell such Placement Shares up to the amount specified, and
otherwise in accordance with, the terms of such Placement Notice.  The Company
acknowledges and agrees that (i) there can be no assurance that MLV will be
successful in selling Placement Shares, (ii) MLV will incur no liability or
obligation to the Company or any other person or entity if it does not sell
Placement Shares for any reason other than a failure by MLV to use its
commercially reasonable efforts consistent with its normal trading and sales
practices and applicable law and regulations to sell such Placement Shares as
required under this Agreement and (iii) MLV shall be under no obligation to
purchase Placement Shares on a principal basis pursuant to this Agreement,
except as otherwise agreed by MLV and the Company.

(b)     Settlement of Placement Shares.  Unless otherwise specified in the
applicable Placement Notice, settlement for sales of Placement Shares will occur
on the third (3rd) Trading Day (or such earlier day as is industry practice for
regular-way trading) following the date on which such sales are made (each, a
“Settlement Date”).  The amount of proceeds to be delivered to the Company on a
Settlement Date against receipt of the Placement Shares sold (the “Net
Proceeds”) will be equal to the aggregate sales price received by MLV, after
deduction for (i) MLV’s commission, discount or other compensation for such
sales payable by the Company pursuant to Section 2 hereof, and (ii) any
transaction fees imposed by any governmental or self-regulatory organization in
respect of such sales.

(c)     Delivery of Placement Shares.  On or before each Settlement Date, the
Company will, or will cause its transfer agent to, electronically transfer the
Placement Shares being sold by crediting MLV’s or its designee’s account
(provided MLV shall have given the Company written notice of such designee prior
to the Settlement Date) at The Depository Trust Company through its Deposit and
Withdrawal at Custodian System or by such other means of delivery as may be
mutually agreed upon by the parties hereto which in all cases shall be freely
tradable, transferable, registered shares in good deliverable form.  On each
Settlement Date, MLV will deliver the related Net Proceeds in same day funds to
an account designated by the Company on, or prior to, the Settlement Date.  The
Company agrees that if the Company, or its transfer agent (if applicable),
defaults in its obligation to deliver Placement Shares on a Settlement Date
through no fault of MLV, the Company agrees that in addition to and in no way
limiting the rights and obligations set forth in Section 11(a) hereto, it will
(i) hold MLV harmless against any loss, claim, damage, or expense (including
reasonable legal fees and expenses), as incurred, arising out of or in
connection with such default by the Company or its transfer agent (if
applicable) and (ii) pay to MLV (without duplication) any commission, discount,
or other compensation to which it would otherwise have been entitled absent such
default.

(d)     Limitations on Offering Size.  Under no circumstances shall the Company
cause or request the offer or sale of any Placement Shares if, after giving
effect to the sale of such Placement Shares, the aggregate gross sales proceeds
of Placement Shares sold pursuant to this Agreement would exceed the lesser of
(A) together with all sales of Placement Shares under this Agreement, the
Maximum Amount, (B) the amount available for offer and sale under the currently
effective Registration Statement and (C) the amount authorized from time to time
to be issued and sold under this Agreement by the Company’s board of directors,
a duly authorized committee thereof or a duly authorized executive committee,
and notified to MLV in writing.  Under no circumstances shall the Company cause
or request the offer or sale of any Placement

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Shares pursuant to this Agreement at a price lower than the minimum price
authorized from time to time by the Company’s board of directors, a duly
authorized committee thereof or a duly authorized executive committee, and
notified to MLV in writing.  Further, under no circumstances shall the Company
cause or permit the aggregate offering amount of Placement Shares sold pursuant
to this Agreement to exceed the Maximum Amount.

6.     Representations and Warranties of the Company.  Except as disclosed in
the Registration Statement and the Prospectus (including the Incorporated
Documents), the Company represents and warrants to, and agrees with MLV that as
of the date of this Agreement and as of each Applicable Time (as defined below),
unless such representation, warranty or agreement specifies a different time or
time:

(a)     Registration Statement and Prospectus.  The Company and, assuming no act
or omission on the part of MLV that would make such statement untrue, the
transactions contemplated by this Agreement meet the requirements for and comply
with the conditions for the use of Form S 3 under the Securities Act, including,
if applicable, the transaction requirements set forth in General Instruction
I.B.6 of such form.  The Registration Statement has been filed with the
Commission and has been declared effective under the Securities Act.  The
Prospectus Supplement will name MLV as the agent in the section entitled “Plan
of Distribution.”  The Company has not received, and has no notice of, any order
of the Commission preventing or suspending the use of the Registration
Statement, or threatening or instituting proceedings for that purpose.  The
Registration Statement and the offer and sale of Placement Shares as
contemplated hereby meet the requirements of Rule 415 under the Securities Act
and comply in all material respects with said Rule.  Any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement have been so described or filed.  Copies of the
Registration Statement, the Prospectus, and any such amendments or supplements
and all documents incorporated by reference therein that were filed with the
Commission on or prior to the date of this Agreement have been delivered, or are
available through EDGAR, to MLV and its counsel.  The Company has not
distributed and, prior to the later to occur of each Settlement Date and
completion of the distribution of the Placement Shares, will not distribute any
offering material in connection with the offering or sale of the Placement
Shares other than the Registration Statement and the Prospectus and any
Permitted Free Writing Prospectus (as defined below).  The Common Stock is
currently listed on the Exchange under the trading symbol “THLD”.  Except as
disclosed in the Registration Statement, including the Incorporated Documents,
the Company has not, in the 12 months preceding the date hereof, received notice
from the Exchange to the effect that the Company is not in compliance with the
listing or maintenance requirements.  Except as disclosed in the Registration
Statement, including the Incorporated Documents, or the Prospectus, the Company
has no reason to believe that it will not in the foreseeable future continue to
be in compliance with all such listing and maintenance requirements.

(b)     No Misstatement or Omission.  The Registration Statement, when it became
effective, and the Prospectus, and any amendment or supplement thereto, on the
date of such Prospectus or amendment or supplement, conformed and will conform
in all material respects with the requirements of the Securities Act.  At each
Settlement Date, the Registration Statement and the Prospectus, as of such date,
will conform in all material respects with the requirements of

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the Securities Act.  The Registration Statement, when it became or becomes
effective, did not, and will not, contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading.  The Prospectus and any amendment
and supplement thereto, on the date thereof and at each Applicable Time, did not
or will not include an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.  The documents
incorporated by reference in the Prospectus did not, and any further documents
filed and incorporated by reference therein will not, when filed with the
Commission, contain an untrue statement of a material fact or omit to state a
material fact required to be stated in such document or necessary to make the
statements in such document, in light of the circumstances under which they were
made, not misleading.  The foregoing shall not apply to statements in, or
omissions from, any such document made in reliance upon, and in conformity with,
information furnished to the Company by MLV specifically for use in the
preparation thereof.

(c)     Conformity with Securities Act and Exchange Act.  The Registration
Statement, the Prospectus, any Permitted Free Writing Prospectus or any
amendment or supplement thereto, and the documents incorporated by reference in
the Registration Statement, the Prospectus or any amendment or supplement
thereto, when such documents were or are filed with the Commission under the
Securities Act or the Exchange Act or became or become effective under the
Securities Act, as the case may be, conformed or will conform in all material
respects with the requirements of the Securities Act and the Exchange Act, as
applicable.

(d)     Financial Information.  The consolidated financial statements of the
Company included or incorporated by reference in the Registration Statement, the
Prospectus and any Permitted Free Writing Prospectus together with the related
notes and schedules, present fairly, in all material respects, the consolidated
financial position of the Company and the Subsidiaries as of the dates indicated
and the consolidated results of operations, cash flows and changes in
stockholders’ equity of the Company for the periods specified and have been
prepared in compliance with the requirements of the Securities Act and Exchange
Act, as applicable, and in conformity with GAAP (as defined below) applied on a
consistent basis (except (i) for such adjustments to accounting standards and
practices as are noted therein or (ii) in the case of unaudited interim
financial statements, to the extent that they may not include footnotes or may
be condensed or summary statements) during the periods involved; there are no
financial statements (historical or pro forma) that are required to be included
or incorporated by reference in the Registration Statement or the Prospectus
that are not included or incorporated by reference as required; and all
disclosures contained or incorporated by reference in the Registration
Statement, the Prospectus and any Permitted Free Writing Prospectus regarding
“non-GAAP financial measures” (as such term is defined by the rules and
regulations of the Commission) comply in all material respects with Regulation G
of the Exchange Act and Item 10 of Regulation S-K under the Securities Act, to
the extent applicable.  The Company and the Subsidiaries (as defined below) do
not have any material liabilities or obligations, direct or contingent
(including any off-balance sheet obligations and any “variable interest
entities” within the meaning of Financial Accounting Standards Board
Interpretation No. 46) not disclosed in the Registration Statement and the
Prospectus and which are required to be disclosed in the Registration Statement
or the Prospectus.

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(e)     Conformity with EDGAR Filing.  The Prospectus delivered to MLV for use
in connection with the sale of the Placement Shares pursuant to this Agreement
will be identical to the versions of the Prospectus created to be transmitted to
the Commission for filing via EDGAR, except to the extent permitted by
Regulation S T.

(f)     Organization.  The Company and each of its Subsidiaries are, and will
be, duly organized, validly existing as a corporation and in good standing (to
the extent such concept applies) under the laws of their respective
jurisdictions of organization.  The Company and each of its Subsidiaries are,
and will be, duly licensed or qualified as a foreign corporation for transaction
of business and in good standing (to the extent such concept applies) under the
laws of each other jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires such license or
qualification, and have all corporate power and authority necessary to own or
hold their respective properties and to conduct their respective businesses as
described in the Registration Statement and the Prospectus, except where the
failure to be so qualified or in good standing or have such power or authority
would not, individually or in the aggregate, reasonably be expected to have a
material adverse effect on the assets, business, operations, earnings,
properties, condition (financial or otherwise), prospects, stockholders’ equity
or results of operations of the Company and the Subsidiaries (as defined below)
taken as a whole, or prevent or materially interfere with consummation of the
transactions contemplated hereby (a “Material Adverse Effect”).

(g)     Subsidiaries. The subsidiaries set forth on Schedule 4 (collectively,
the “Subsidiaries”), are the Company’s only subsidiaries. Except as set forth in
the Registration Statement and in the Prospectus, the Company owns, directly or
indirectly, all of the equity interests of the Subsidiaries free and clear of
any lien, charge, security interest, encumbrance, right of first refusal or
other restriction, and all the equity interests of the Subsidiaries are validly
issued and are fully paid, nonassessable and free of preemptive and similar
rights.

(h)     No Violation or Default.  Neither the Company nor any of its
Subsidiaries is (i) in violation of its charter or by-laws or similar
organizational documents; (ii) in default, and no event has occurred that, with
notice or lapse of time or both, would constitute such a default, in the due
performance or observance of any term, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound or to which any of the
property or assets of the Company or any of its Subsidiaries are subject; or
(iii) in violation of any law or statute or any judgment, order, rule or
regulation of any court or arbitrator or governmental or regulatory authority,
except, in the case of each of clauses (ii) and (iii) above, for any such
violation or default that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.  Except as described
in the Prospectus, the Prospectus Supplement or the Incorporated Documents, to
the Company’s knowledge, no other party under any material contract or other
agreement to which it or any of its Subsidiaries is a party is in default in any
respect thereunder where such default would reasonably be expected to have a
Material Adverse Effect.

(i)     No Material Adverse Change.  Subsequent to the respective dates as of
which information is given in the Registration Statement and the Prospectus
(including the Incorporated Documents), there has not been (i) any Material
Adverse Effect, (iii) any obligation

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or liability, direct or contingent (including any off-balance sheet
obligations), incurred by the Company or any Subsidiary, which is material to
the Company and the Subsidiaries taken as a whole, (iv) any material change in
the capital stock (other than (A) as a result of the sale of Placement Shares,
(B) as described in a current report on Form 8-K, a proxy statement filed on
Schedule 14A or a Registration Statement on Form S-4 and otherwise publicly
announced or (C) changes in the number of outstanding shares of Common Stock due
to the issuance of shares upon the exercise or conversion of securities
exercisable for, or convertible into, shares of Common Stock, or the vesting of
equity awards) or outstanding long-term indebtedness of the Company or any of
its Subsidiaries or (v) any dividend or distribution of any kind declared, paid
or made on the capital stock of the Company or any Subsidiary, other than in
each case above (A) in the ordinary course of business, (B) as otherwise
disclosed in the Registration Statement or Prospectus (including the
Incorporated Documents) or (C) where such matter, item, change or development
would not make the statements in the Registration Statement or the Prospectus
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading.

(j)     Capitalization.  The issued and outstanding shares of capital stock of
the Company have been validly issued, are fully paid and nonassessable and,
other than as disclosed in the Registration Statement or the Prospectus, are not
subject to any preemptive rights, rights of first refusal or similar
rights.  The Company has an authorized, issued and outstanding capitalization as
set forth in the Registration Statement and the Prospectus as of the dates
referred to therein (other than the grant of additional options or other equity
awards under the Company’s existing equity compensation plans, or changes in the
number of outstanding Common Stock of the Company due to the issuance of shares
upon the exercise, vesting or conversion of securities exercisable for, or
convertible into, Common Stock outstanding on the date hereof or described in
the Registration Statement or Prospectus (including the Incorporated Documents),
or as a result of the issuance of Placement Shares) and such authorized capital
stock conforms to the description thereof set forth in the Registration
Statement and the Prospectus.  The description of the Common Stock in the
Registration Statement and the Prospectus is complete and accurate in all
material respects.  Except as disclosed in or contemplated by the Registration
Statement or the Prospectus, as of the dates referred to therein, the Company
did not have outstanding any options to purchase, or any rights or warrants to
subscribe for, or any securities or obligations convertible into, or
exchangeable for, or any contracts or commitments to issue or sell, any shares
of capital stock or other securities.

(k)     Authorization; Enforceability.  The Company has full legal right, power
and authority to enter into this Agreement and perform the transactions
contemplated hereby.  This Agreement has been duly authorized, executed and
delivered by the Company and is a legal, valid and binding agreement of the
Company enforceable against the Company in accordance with its terms, except to
the extent that (i) enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ rights generally
and by general equitable principles and (ii) the indemnification and
contribution provisions of Section 11 hereof may be limited by federal or state
securities laws and public policy considerations in respect thereof.

(l)     Authorization of Placement Shares.  The Placement Shares, when issued
and delivered pursuant to the terms approved by the board of directors of the
Company or a duly

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authorized committee thereof, or a duly authorized executive committee, against
payment therefor as provided herein, will be duly and validly authorized and
issued and fully paid and nonassessable, free and clear of any pledge, lien,
encumbrance, security interest or other claim (other than any pledge, lien,
encumbrance, security interest or other claim arising from an act or omission of
MLV or a purchaser), including any statutory or contractual preemptive rights,
resale rights, rights of first refusal or other similar rights, and will be
registered pursuant to Section 12 of the Exchange Act.  The Placement Shares,
when issued, will conform in all material respects to the description thereof
set forth in or incorporated into the Prospectus.

(m)     No Consents Required.  No consent, approval, authorization, order,
registration or qualification of or with any court or arbitrator or any
governmental or regulatory authority is required for the execution, delivery and
performance by the Company of this Agreement, and the issuance and sale by the
Company of the Placement Shares as contemplated hereby, except for the
registration of the Placement Shares under the Securities Act and such consents,
approvals, authorizations, orders and registrations or qualifications as may be
required under applicable state securities laws or by the by-laws and rules of
the Financial Industry Regulatory Authority (“FINRA”) or the Exchange in
connection with the sale of the Placement Shares by MLV.

(n)     No Preferential Rights.  Except as set forth in the Registration
Statement and the Prospectus, (i) no person, as such term is defined in Rule
1-02 of Regulation S-X promulgated under the Securities Act (each, a “Person”),
has the right, contractual or otherwise, to cause the Company to issue or sell
to such Person any Common Stock or shares of any other capital stock or other
securities of the Company (other than upon the exercise of options or warrants
to purchase Common Stock or upon the exercise or vesting of options or other
equity awards that may be granted from time to time under the Company’s equity
compensation plans), (ii) no Person has any preemptive rights, rights of first
refusal, or any other rights (whether pursuant to a “poison pill” provision or
otherwise) to purchase any Common Stock or shares of any other capital stock or
other securities of the Company from the Company which have not been duly waived
with respect to the offering contemplated hereby, (iii) except as may be
disclosed to MLV, no Person has the right to act as an underwriter or as a sales
agent to the Company in connection with the offer and sale of the Common Stock,
and (iv) no Person has the right, contractual or otherwise, to require the
Company to register under the Securities Act any Common Stock or shares of any
other capital stock or other securities of the Company, or to include any such
shares or other securities in the Registration Statement or the offering
contemplated thereby, whether as a result of the filing or effectiveness of the
Registration Statement or the sale of the Placement Shares as contemplated
thereby or otherwise.

(o)     Independent Public Accountant.  Ernst & Young LLP (the “Accountant”),
whose report on the consolidated financial statements of the Company is filed
with the Commission as part of the Company’s most recent Annual Report on
Form 10-K filed with the Commission and incorporated into the Registration
Statement, are and, during the periods covered by their report, were independent
public accountants within the meaning of the Securities Act and the Public
Company Accounting Oversight Board (United States).  To the Company’s knowledge,
after due inquiry, the Accountant is not in violation of the auditor
independence requirements of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley
Act”) with respect to the Company.

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(p)     Enforceability of Agreements.  To the knowledge of the Company, all
agreements between the Company and third parties expressly referenced in the
Prospectus, other than such agreements that have expired by their terms or whose
termination is disclosed in documents filed by the Company on EDGAR, are legal,
valid and binding obligations of the Company enforceable in accordance with
their respective terms, except to the extent that (i) enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors’ rights generally and by general equitable principles and
(ii) the indemnification provisions of certain agreements may be limited be
federal or state securities laws or public policy considerations in respect
thereof, except for any unenforceability that, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect.

(q)     No Litigation.  Except as set forth in the Registration Statement or the
Prospectus, there are no legal, governmental or regulatory actions, suits or
proceedings pending, nor, to the Company’s knowledge, any legal, governmental or
regulatory investigations, to which the Company or a Subsidiary is a party or to
which any property of the Company or any of its Subsidiaries is the subject
that, individually or in the aggregate, if determined adversely to the Company
or any of its Subsidiaries, would reasonably be expected to have a Material
Adverse Effect or materially and adversely affect the ability of the Company to
perform its obligations under this Agreement; to the Company’s knowledge, no
such actions, suits or proceedings are threatened or contemplated by any
governmental or regulatory authority or threatened by others that, individually
or in the aggregate, if determined adversely to the Company or any of its
Subsidiaries, would reasonably be expected to have a Material Adverse Effect; or
and (i) there are no current or pending legal, governmental or regulatory
investigations, actions, suits or proceedings that are required under the
Securities Act to be described in the Prospectus that are not described in the
Prospectus including any Incorporated Document; and (ii) there are no contracts
or other documents that are required under the Securities Act to be filed as
exhibits to the Registration Statement that are not so filed.

(r)     Licenses and Permits.  Except as set forth in the Registration Statement
or the Prospectus, the Company and each of its Subsidiaries possess or have
obtained, all licenses, certificates, consents, orders, approvals, permits and
other authorizations issued by, and have made all declarations and filings with,
the appropriate federal, state, local or foreign governmental or regulatory
authorities that are necessary for the ownership or lease of their respective
properties or the conduct of their respective businesses as described in the
Registration Statement and the Prospectus (the “Permits”), except where the
failure to possess, obtain or make the same would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.  Except as
disclosed in the Registration Statement or the Prospectus, neither the Company
nor any of its Subsidiaries have received written notice of any proceeding
relating to revocation or modification of any such Permit or has any reason to
believe that such Permit will not be renewed in the ordinary course, except
where the failure to obtain any such renewal would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

(s)     Market Capitalization.  As of the close of trading on the Exchange on
the Trading Day immediately prior to the date of this Agreement, the aggregate
market value of the outstanding voting and non-voting common equity (as defined
in Securities Act Rule 405) of the

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Company held by persons other than affiliates of the Company (pursuant to
Securities Act Rule 144, those that directly, or indirectly through one or more
intermediaries, control, or are controlled by, or are under common control with,
the Company) (the “Non-Affiliate Shares”), was approximately $227.8 million
(calculated by multiplying (x) the price at which the common equity of the
Company was last sold on the Exchange on the Trading Day immediately prior to
the date of this Agreement times (y) the number of Non-Affiliate Shares).  

(t)     No Material Defaults.  Neither the Company nor any of the Subsidiaries
has defaulted on any installment on indebtedness for borrowed money or on any
rental on one or more long-term leases, which defaults, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.  The
Company has not filed a report pursuant to Section 13(a) or 15(d) of the
Exchange Act since the filing of its last Annual Report on Form 10-K, indicating
that it (i) has failed to pay any dividend or sinking fund installment on
preferred stock or (ii) has defaulted on any installment on indebtedness for
borrowed money or on any rental on one or more long-term leases, which defaults,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

(u)     Certain Market Activities.  Neither the Company, nor any of the
Subsidiaries, nor any of their respective directors, officers or controlling
persons has taken, directly or indirectly, any action designed, or that has
constituted or might reasonably be expected to cause or result in, under the
Exchange Act or otherwise, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Placement
Shares.

(v)     Broker/Dealer Relationships.  Neither the Company nor any of the
Subsidiaries or any related entities (i) is required to register as a “broker”
or “dealer” in accordance with the provisions of the Exchange Act or (ii)
directly or indirectly through one or more intermediaries, controls or is a
“person associated with a member” or “associated person of a member” (within the
meaning set forth in the FINRA Manual).

(w)     No Reliance.  The Company has not relied upon MLV or legal counsel for
MLV for any legal, tax or accounting advice in connection with the offering and
sale of the Placement Shares.

(x)     Taxes.  The Company and each of its Subsidiaries have filed all federal,
state, local and foreign tax returns which have been required to be filed and
paid all taxes shown thereon through the date hereof, to the extent that such
taxes have become due and are not being contested in good faith, except where
the failure to do so would not reasonably be expected to have a Material Adverse
Effect.  Except as otherwise disclosed in or contemplated by the Registration
Statement or the Prospectus, no tax deficiency has been determined adversely to
the Company or any of its Subsidiaries which has had, or would reasonably be
expected to have, individually or in the aggregate, a Material Adverse
Effect.  The Company has no knowledge of any federal, state or other
governmental tax deficiency, penalty or assessment which has been or might be
asserted or threatened against it which could have a Material Adverse Effect.

(y)     Title to Real and Personal Property.  Except as set forth in the
Registration Statement or the Prospectus, the Company and its Subsidiaries have
good and valid title in fee

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simple to all items of real property and good and valid title to all personal
property (excluding Intellectual Property) described in the Registration
Statement or Prospectus as being owned by them that are material to the
businesses of the Company or such Subsidiary, in each case free and clear of all
liens, encumbrances and claims, except those that (i) do not materially
interfere with the use made and proposed to be made of such property by the
Company and any of its Subsidiaries or (ii) would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.  Any real
property described in the Registration Statement or Prospectus as being leased
by the Company and any of its Subsidiaries is held by them under valid, existing
and enforceable leases, except those that (A) do not materially interfere with
the use made or proposed to be made of such property by the Company or any of
its Subsidiaries or (B) would not be reasonably expected, individually or in the
aggregate, to have a Material Adverse Effect.

(z)     Intellectual Property.  Except as set forth in the Registration
Statement or the Prospectus, to the Company’s knowledge, the Company and its
Subsidiaries own or possess adequate enforceable rights to use all patents,
patent applications, trademarks (both registered and unregistered), service
marks, trade names, trademark registrations, service mark registrations,
copyrights, licenses and know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures) (collectively, the “Intellectual Property”), necessary for the
conduct of their respective businesses as conducted as of the date hereof,
except to the extent that the failure to own or possess adequate rights to use
such Intellectual Property would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect; except as disclosed in
writing to MLV, the Company and any of its Subsidiaries have not received any
written notice of any claim of infringement or conflict which asserted
Intellectual Property rights of others, which infringement or conflict, if the
subject of an unfavorable decision, would result in a Material Adverse Effect;
there are no pending, or to the Company’s knowledge, threatened judicial
proceedings or interference proceedings against the Company challenging the
Company’s or its Subsidiaries’ rights in or to or the validity of the scope of
any of the Company’s or its Subsidiaries’ patents, patent applications or
proprietary information, except for any such proceedings that would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  To the Company’s knowledge, no other entity or individual has
any right or claim in any of the Company’s or its Subsidiaries’ owned patents,
patent applications or any patent to be issued therefrom by virtue of any
contract, license or other agreement entered into between such entity or
individual and the Company or a Subsidiary or by any non-contractual obligation,
other than by written licenses granted by the Company or a Subsidiary and other
than such rights or claims that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The Company and its
Subsidiaries have not received any written notice of any claim challenging the
rights of the Company or a Subsidiary in or to any Intellectual Property owned,
licensed or optioned by the Company or such Subsidiary which claim, if the
subject of an unfavorable decision would result in a Material Adverse Effect.

(aa)     Environmental Laws.  Except as set forth in the Registration Statement
or the Prospectus, the Company and its Subsidiaries (i) are in compliance with
any and all applicable federal, state, local and foreign laws, rules,
regulations, decisions and orders relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants (collectively, “Environmental Laws”); (ii) have received and

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are in compliance with all permits, licenses or other approvals required of them
under applicable Environmental Laws to conduct their respective businesses as
described in the Registration Statement and the Prospectus; and (iii) have not
received notice of any actual or potential liability for the investigation or
remediation of any disposal or release of hazardous or toxic substances or
wastes, pollutants or contaminants, except, in the case of any of clauses (i),
(ii) or (iii) above, for any such failure to comply or failure to receive
required permits, licenses, other approvals or liability as would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

(bb)     Disclosure Controls.  The Company maintains systems of internal
accounting controls designed to provide reasonable assurance that
(i) transactions are executed in accordance with management’s general or
specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.  Since the date of the latest audited financial
statements of the Company included in the Prospectus, there has been no change
in the Company’s internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting (other than as set forth in the
Prospectus).  The Company has established disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15 and 15d-15) for the Company and designed
such disclosure controls and procedures to ensure that material information
relating to the Company and each of its Subsidiaries is made known to the
certifying officers by others within those entities, particularly during the
period in which the Company’s Annual Report on Form 10-K or Quarterly Report on
Form 10-Q, as the case may be, is being prepared.  The Company’s certifying
officers have evaluated the effectiveness of the Company’s controls and
procedures as of a date within 90 days prior to the filing date of the Form 10-K
for the fiscal year most recently ended (such date, the “Evaluation Date”).  The
Company presented in its Form 10 K for the fiscal year most recently ended the
conclusions of the certifying officers about the effectiveness of the disclosure
controls and procedures based on their evaluations as of the Evaluation
Date.  Since the Evaluation Date, there have been no significant changes in the
Company’s internal controls (as such term is defined in Item 307(b) of
Regulation S K under the Securities Act).  To the knowledge of the Company, the
Company’s “internal controls over financial reporting” and “disclosure controls
and procedures” are effective.

(cc)     Sarbanes-Oxley.  There is and has been no failure on the part of the
Company or, to the knowledge of the Company, any of the Company’s directors or
officers, in their capacities as such, to comply with any applicable provisions
of the Sarbanes-Oxley Act and the rules and regulations promulgated
thereunder.  Each of the principal executive officer and the principal financial
officer of the Company (or each former principal executive officer of the
Company and each former principal financial officer of the Company as
applicable) has made all certifications required by Sections 302 and 906 of the
Sarbanes-Oxley Act with respect to all reports, schedules, forms, statements and
other documents required to be filed by it or furnished by it to the
Commission.  For purposes of the preceding sentence, “principal executive
officer” and “principal financial officer” shall have the meanings given to such
terms in the Sarbanes-Oxley Act.

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(dd)     Finder’s Fees.  Neither the Company nor any of the Subsidiaries has
incurred any liability for any finder’s fees, brokerage commissions or similar
payments in connection with the transactions herein contemplated, except as may
otherwise exist with respect to MLV pursuant to this Agreement.

(ee)     Labor Disputes.  No labor disturbance by or dispute with employees of
the Company or any of its Subsidiaries exists or, to the knowledge of the
Company, is threatened which would reasonably be expected to result in a
Material Adverse Effect.

(ff)     Investment Company Act.  Neither the Company nor any of the
Subsidiaries is or, after giving effect to the offering and sale of the
Placement Shares, will be an “investment company” or an entity “controlled” by
an “investment company,” as such terms are defined in the Investment Company Act
of 1940, as amended (the “Investment Company Act”).

(gg)     Operations.  The operations of the Company and its Subsidiaries are and
have been conducted at all times in compliance with applicable financial record
keeping and reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of all
jurisdictions to which the Company or its Subsidiaries are subject, the rules
and regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”), except as would not reasonably be
expected to result in a Material Adverse Effect; and no action, suit or
proceeding by or before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its Subsidiaries with respect to
the Money Laundering Laws is pending or, to the knowledge of the Company,
threatened.

(hh)     Off-Balance Sheet Arrangements.  There are no transactions,
arrangements and other relationships between and/or among the Company, and/or,
to the knowledge of the Company, any of its affiliates and any unconsolidated
entity, including, but not limited to, any structural finance, special purpose
or limited purpose entity (each, an “Off Balance Sheet Transaction”) that could
reasonably be expected to affect materially the Company’s liquidity or the
availability of or requirements for its capital resources, including those Off
Balance Sheet Transactions described in the Commission’s Statement about
Management’s Discussion and Analysis of Financial Conditions and Results of
Operations (Release Nos. 33-8056; 34-45321; FR-61), required to be described in
the Prospectus which have not been described as required.

(ii)     Underwriter Agreements.  The Company is not a party to any agreement
with an agent or underwriter for any other “at-the-market” transaction.

(jj)     ERISA. To the knowledge of the Company, each material employee benefit
plan, within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), that is maintained, administered or
contributed to by the Company or any of its affiliates for employees or former
employees of the Company and any of its Subsidiaries has been maintained in
material compliance with its terms and the requirements of any applicable
statutes, orders, rules and regulations, including but not limited to ERISA and
the Internal Revenue Code of 1986, as amended (the “Code”); no prohibited
transaction, within the meaning of Section 406 of ERISA or Section 4975 of the
Code, has occurred which would

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result in a material liability to the Company with respect to any such plan
excluding transactions effected pursuant to a statutory or administrative
exemption; and for each such plan, if any, that is subject to the funding rules
of Section 412 of the Code or Section 302 of ERISA, no “accumulated funding
deficiency” as defined in Section 412 of the Code has been incurred, whether or
not waived, and the fair market value of the assets of each such plan (excluding
for these purposes accrued but unpaid contributions) equals or exceeds the
present value of all benefits accrued under such plan determined using
reasonable actuarial assumptions, other than, in the case of (i), (ii) and
(iii) above, as would not reasonably be expected to have a Material Adverse
Effect.

(kk)     Margin Rules.  Neither the issuance, sale and delivery of the Placement
Shares nor the application of the proceeds thereof by the Company as described
in the Registration Statement and the Prospectus will violate Regulation T, U or
X of the Board of Governors of the Federal Reserve System or any other
regulation of such Board of Governors.

(ll)     Insurance.  The Company and each of its Subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as the Company and
each of its Subsidiaries reasonably believe are adequate for the conduct of
their properties and as is customary for companies of similar size engaged in
similar businesses in similar industries.

(mm)     No Improper Practices. (i) Neither the Company nor, to the Company’s
knowledge, the Subsidiaries, nor to the Company’s knowledge, any of their
respective executive officers has, in the past five years, made any unlawful
contributions to any candidate for any political office (or failed fully to
disclose any contribution in violation of law) or made any contribution or other
payment to any official of, or candidate for, any federal, state, municipal, or
foreign office or other person charged with similar public or quasi-public duty
in violation of any law; (ii) no relationship, direct or indirect, exists
between or among the Company or, to the Company’s knowledge, any Subsidiary or
any affiliate of any of them, on the one hand, and the directors, officers and
stockholders of the Company or, to the Company’s knowledge, any Subsidiary, on
the other hand, that is required by the Securities Act to be described in the
Registration Statement and the Prospectus that is not so described; (iii) no
relationship, direct or indirect, exists between or among the Company or any
Subsidiary or any affiliate of them, on the one hand, and the directors,
officers, stockholders or directors of the Company or, to the Company’s
knowledge, any Subsidiary, on the other hand, that is required by the rules of
FINRA to be described in the Registration Statement and the Prospectus that is
not so described; (iv) except as described in the Prospectus, there are no
material outstanding loans or advances or material guarantees of indebtedness by
the Company or, to the Company’s knowledge, any Subsidiary to or for the benefit
of any of their respective officers or directors or any of the members of the
families of any of them; and (v) neither the Company nor any Subsidiary nor, to
the Company’s knowledge, any employee or agent of the Company or any Subsidiary
has made any payment of funds of the Company or any Subsidiary or received or
retained any funds in violation of any law, rule or regulation (including,
without limitation, the Foreign Corrupt Practices Act of 1977), which payment,
receipt or retention of funds would reasonably be expected to have a Material
Adverse Effect.

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(nn)     Status Under the Securities Act.  The Company was not and is not an
ineligible issuer as defined in Rule 405 under the Securities Act at the times
specified in Rules 164 and 433 under the Securities Act in connection with the
offering of the Placement Shares.

(oo)     No Conflicts.  Neither the execution of this Agreement by the Company,
nor the issuance, offering or sale of the Placement Shares, nor the consummation
by the Company of any of the transactions contemplated herein and therein, nor
the compliance by the Company with the terms and provisions hereof and thereof
will conflict with, or will result in a breach of, any of the terms and
provisions of, or has constituted or will constitute a default under, or has
resulted in or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company pursuant to the terms of
any contract or other agreement to which the Company may be bound or to which
any of the property or assets of the Company is subject, except (i) such
conflicts, breaches or defaults as may have been waived and (ii) such conflicts,
breaches and defaults that would not reasonably be expected to have a Material
Adverse Effect; nor will such action result (x) in any violation of the
provisions of the organizational or governing documents of the Company, or
(y) in any material violation of the provisions of any statute or any order,
rule or regulation applicable to the Company or of any court or of any federal,
state or other regulatory authority or other government body having jurisdiction
over the Company, except where such violation would not reasonably be expected
to have a Material Adverse Effect.

(pp)     Clinical Studies.  The clinical, pre-clinical and other studies and
tests conducted by or, to the knowledge of the Company, on behalf of the Company
were, and, if still pending, are being, conducted in accordance in all material
respects with all statutes, laws, rules and regulations, as applicable
(including, without limitation, the U.S. Federal and Drug Administration’s (the
“FDA”) Good Laboratory Practices and Good Clinical Practices as well as all
other applicable rules, regulations, or requirements of the FDA or any foreign,
federal, state or local governmental or regulatory authority performing
functions similar to those performed by the FDA), except where the failure to do
so would not, individually or in the aggregate, have a Material Adverse
Effect.  Except as set forth in the Registration Statement and Prospectus, the
Company has not received any written notices or other written correspondence
from the FDA or any other foreign, federal, state or local governmental or
regulatory authority performing functions similar to those performed by the FDA
requiring the Company to terminate or suspend any ongoing clinical or
pre-clinical studies or tests.  Except as set forth in the Registration
Statement and Prospectus, the Company has not received any Form 483 or other
adverse finding from the FDA or any other regulator with respect to any clinical
site, clinical trial protocol, or clinical investigator, other than any such
Form 483 or adverse finding that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

(qq)     Compliance Program.  Except as disclosed in the Registration Statement
and the Prospectus, the Company has established and administers a compliance
program applicable to the Company, to assist the Company and the directors,
officers and employees of the Company in complying with applicable regulatory
guidelines (including, without limitation, those administered by the FDA and any
other foreign, federal, state or local governmental or regulatory authority
performing functions similar to those performed by the FDA); except where such
noncompliance would not reasonably be expected to have a Material Adverse
Effect.  The Company has also established a Quality Assurance unit that is
responsible for ensuring that each

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test article complies with specifications, that all vendors are appropriately
qualified, that all regulatory quality assurance requirements are met, and that
all protocols, procedures and regulations that govern the conduct and monitoring
of clinical trials are followed.

(rr)     Stock Transfer Taxes.  On each Settlement Date, all stock transfer or
other taxes (other than income taxes) which are required to be paid in
connection with the sale and transfer of the Placement Shares to be sold
hereunder will be, or will have been, fully paid or provided for by the Company
and all laws imposing such taxes will be or will have been fully complied with.

Any certificate signed by an officer of the Company and delivered to MLV or to
counsel for MLV pursuant to or in connection with this Agreement shall be deemed
to be a representation and warranty by the Company, as applicable, to MLV as to
the matters set forth therein.

7.     Covenants of the Company.  The Company covenants and agrees with MLV
that:

(a)     Registration Statement Amendments.  After the date of this Agreement and
during any period in which a Prospectus relating to any Placement Shares is
required to be delivered by MLV under the Securities Act (including in
circumstances where such requirement may be satisfied pursuant to Rule 172 under
the Securities Act), (i) the Company will notify MLV promptly of the time when
any subsequent amendment to the Registration Statement, other than documents
incorporated by reference, has been filed with the Commission and/or has become
effective or any subsequent supplement to the Prospectus (other than documents
incorporated by reference therein) has been filed and of any request by the
Commission for any amendment or supplement to the Registration Statement or
Prospectus or for additional information, (ii) the Company will prepare and file
with the Commission, promptly upon MLV’s request, any amendments or supplements
to the Registration Statement or Prospectus that, in MLV’s reasonable opinion,
may be necessary or advisable in connection with the distribution of the
Placement Shares by MLV (provided, however, that the failure of MLV to make such
request shall not relieve the Company of any obligation or liability hereunder,
or affect MLV’s right to rely on the representations and warranties made by the
Company in this Agreement and provided, further, that the only remedy MLV shall
have with respect to the failure to make such filing shall be to cease making
sales under this Agreement until such amendment or supplement is filed); (iii)
the Company will not file any amendment or supplement to the Registration
Statement or Prospectus (other than documents incorporated by reference therein)
relating to the Placement Shares or a security convertible into the Placement
Shares unless a copy thereof has been submitted to MLV within a reasonable
period of time before the filing and MLV has not objected thereto (provided,
however, that (A) the failure of MLV to make such objection shall not relieve
the Company of any obligation or liability hereunder, or affect MLV’s right to
rely on the representations and warranties made by the Company in this
Agreement, (B) the Company has no obligation to provide MLV any advance copy of
such filing or to provide MLV an opportunity to object to such filing if such
filing does not name MLV or does not relate to the transactions contemplated by
this Agreement, and (C) the only remedy MLV shall have with respect to the
failure by the Company to provide MLV with such copy or the filing of such
amendment or supplement despite MLV’s objection shall be to cease making sales
under this Agreement) and the Company will furnish to MLV at the time of filing
thereof a copy of any

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document that upon filing is deemed to be incorporated by reference into the
Registration Statement or Prospectus, except for those documents available via
EDGAR; and (iv) the Company will cause each amendment or supplement to the
Prospectus to be filed with the Commission as required pursuant to the
applicable paragraph of Rule 424(b) of the Securities Act or, in the case of any
document to be incorporated therein by reference, to be filed with the
Commission as required pursuant to the Exchange Act, within the time period
prescribed (the determination to file or not file any amendment or supplement
with the Commission under this Section 7(a), based on the Company’s reasonable
opinion or reasonable objections, shall be made exclusively by the Company).

(b)     Notice of Commission Stop Orders.  The Company will advise MLV, promptly
after it receives notice or obtains knowledge thereof, of the issuance or
threatened issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement, of the suspension of the
qualification of the Placement Shares for offering or sale in any jurisdiction,
or of the initiation or threatening of any proceeding for any such purpose; and
it will promptly use its commercially reasonable efforts to prevent the issuance
of any stop order or to obtain its withdrawal if such a stop order should be
issued.  The Company will advise MLV promptly after it receives any request by
the Commission for any amendments to the Registration Statement or any amendment
or supplements to the Prospectus or any Permitted Free Writing Prospectus or for
additional information related to the offering of the Placement Shares or for
additional information related to the Registration Statement, the Prospectus or
any Permitted Free Writing Prospectus.

(c)     Delivery of Prospectus; Subsequent Changes.  During any period in which
a Prospectus relating to the Placement Shares is required to be delivered by MLV
under the Securities Act with respect to the offer and sale of the Placement
Shares, (including in circumstances where such requirement may be satisfied
pursuant to Rule 172 under the Securities Act), the Company will comply in all
material respects with all requirements imposed upon it by the Securities Act,
as from time to time in force, and to file on or before their respective due
dates all reports and any definitive proxy or information statements required to
be filed by the Company with the Commission pursuant to Sections 13(a), 13(c),
14, 15(d) or any other provision of or under the Exchange Act.  If the Company
has omitted any information from the Registration Statement pursuant to Rule
430A under the Securities Act, it will use its best efforts to comply with the
provisions of and make all requisite filings with the Commission pursuant to
said Rule 430A and to notify MLV promptly of all such filings.  If during the
pendency of a Placement Notice any event occurs as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances then existing, not
misleading, or if during the pendency of a Placement Notice it is necessary to
amend or supplement the Registration Statement or Prospectus to comply with the
Securities Act, the Company will promptly notify MLV to suspend the offering of
Placement Shares during such period and the Company will promptly amend or
supplement the Registration Statement or Prospectus (at the expense of the
Company) so as to correct such statement or omission or effect such compliance;
provided, however, that the Company may delay any such amendment or supplement
if, in the judgment of the Company, it is in the best interests of the Company
to do so.

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(d)     Listing of Placement Shares.  During any period in which the Prospectus
relating to the Placement Shares is required to be delivered by MLV under the
Securities Act with respect to the offer and sale of the Placement Shares, the
Company will use its reasonable best efforts to cause the Placement Shares to be
listed on the Exchange and to qualify the Placement Shares for sale under the
securities laws of such jurisdictions as MLV reasonably designates and to
continue such qualifications in effect so long as required for the distribution
of the Placement Shares; provided, however, that the Company shall not be
required in connection therewith to qualify as a foreign corporation or dealer
in securities or file a general consent to service of process in any
jurisdiction.

(e)     Delivery of Registration Statement and Prospectus.  The Company will
furnish to MLV and its counsel (at the expense of the Company) copies of the
Registration Statement, the Prospectus (including all documents incorporated by
reference therein) and all amendments and supplements to the Registration
Statement or Prospectus that are filed with the Commission during any period in
which a Prospectus relating to the Placement Shares is required to be delivered
under the Securities Act (including all documents filed with the Commission
during such period that are deemed to be incorporated by reference therein), in
each case as soon as reasonably practicable and in such quantities as MLV may
from time to time reasonably request and, at MLV’s request, will also furnish
copies of the Prospectus to each exchange or market on which sales of the
Placement Shares may be made; provided, however, that the Company shall not be
required to furnish any document (other than the Prospectus) to MLV to the
extent such document is available on EDGAR.

(f)     Earnings Statement.  The Company will make generally available to its
security holders as soon as practicable, but in any event not later than
15 months after the end of the Company’s current fiscal quarter, an earnings
statement covering a 12-month period that satisfies the provisions of
Section 11(a) and Rule 158 of the Securities Act.

(g)     Use of Proceeds.  The Company will use the Net Proceeds as described in
the Prospectus in the section entitled “Use of Proceeds.”

(h)     Notice of Other Sales.  Without the prior written consent of MLV, the
Company will not, directly or indirectly, offer to sell, sell, contract to sell,
grant any option to sell or otherwise dispose of any Common Stock (other than
the Placement Shares offered pursuant to this Agreement) or securities
convertible into or exchangeable for Common Stock, warrants or any rights to
purchase or acquire, Common Stock during the period beginning on the fifth (5th)
Trading Day immediately prior to the date on which any Placement Notice is
delivered to MLV hereunder and ending on the fifth (5th) Trading Day immediately
following the final Settlement Date with respect to Placement Shares sold
pursuant to such Placement Notice (or, if the Placement Notice has been
terminated or suspended prior to the sale of all Placement Shares covered by a
Placement Notice, ending on the date of such suspension or termination); and
will not directly or indirectly engage in any other “at-the-market” transaction;
provided, however, that such restrictions will not be required in connection
with the Company’s issuance or sale of (i) Common Stock, options to purchase
Common Stock or other equity awards, or Common Stock issuable upon the exercise
of options or vesting of any equity awards, pursuant to any employee or director
equity compensation or benefits plan, stock ownership plan or dividend
reinvestment plan (but not Common Stock subject to a waiver to exceed plan
limits in its

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dividend reinvestment plan) of the Company whether now in effect or hereafter
implemented; (ii) Common Stock issuable upon conversion of securities or the
exercise or vesting of warrants, options or other rights in effect or
outstanding, and disclosed in filings by the Company available on EDGAR or
otherwise in writing to MLV and (iii) Common Stock, or securities convertible
into or exercisable for Common Stock, offered and sold in a privately negotiated
transaction to vendors, customers, investors, strategic partners or potential
strategic partners and otherwise conducted in a manner so as not to be
integrated with the offering of Common Stock hereby.

(i)     Change of Circumstances.  The Company will, at any time during the
pendency of a Placement Notice advise MLV promptly after it shall have received
notice or obtained knowledge thereof, of any information or fact that would
alter or affect in any material respect any opinion, certificate, letter or
other document required to be provided to MLV pursuant to this Agreement.

(j)     Due Diligence Cooperation.  The Company will cooperate with any
reasonable due diligence review conducted by MLV or its representatives in
connection with the transactions contemplated hereby, including, without
limitation, providing information and making available documents and senior
corporate officers, during regular business hours and at the Company’s principal
offices, as MLV may reasonably request.

(k)     Required Filings Relating to Placement of Placement Shares.  The Company
agrees that on such dates as the Securities Act shall require, the Company will
(i) file a prospectus supplement with the Commission under the applicable
paragraph of Rule 424(b) under the Securities Act (each and every filing under
Rule 424(b), a “Filing Date”), which prospectus supplement will set forth,
within the relevant period, the amount of Placement Shares sold through MLV, the
Net Proceeds to the Company and the compensation payable by the Company to MLV
with respect to such Placement Shares, and (ii) deliver such number of copies of
each such prospectus supplement to each exchange or market on which such sales
were effected as may be required by the rules or regulations of such exchange or
market.

(l)     Representation Dates; Certificate.  On or prior to the date of the first
Placement Notice given hereunder and each time during the term of this Agreement
the Company:

(i)     files the Prospectus relating to the Placement Shares or amends or
supplements (other than a prospectus supplement relating solely to an offering
of securities other than the Placement Shares) the Registration Statement or the
Prospectus relating to the Placement Shares by means of a post-effective
amendment, sticker, or supplement but not by means of incorporation of documents
by reference into the Registration Statement or the Prospectus relating to the
Placement Shares;

(ii)     files an annual report on Form 10-K under the Exchange Act (including
any Form 10-K/A containing amended financial information or a material amendment
to the previously filed Form 10-K);

(iii)     files its quarterly reports on Form 10-Q under the Exchange Act; or

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(iv)     files a current report on Form 8-K containing amended financial
information (other than information “furnished” pursuant to Items 2.02 or 7.01
of Form 8-K or to provide disclosure pursuant to Item 8.01 of Form 8-K relating
to the reclassification of certain properties as discontinued operations in
accordance with Statement of Financial Accounting Standards No. 144) under the
Exchange Act;

(Each date of filing of one or more of the documents referred to in clauses (i)
through (iv) shall be a “Representation Date.”)

the Company shall furnish MLV (but in the case of clause (iv) above only if MLV
reasonably determines that the information contained in such Form 8 K is
material) with a certificate, in the form attached hereto as Exhibit 7(l).  The
requirement to provide a certificate under this Section 7(l) shall be waived for
any Representation Date occurring at a time at which no Placement Notice is
pending, which waiver shall continue until the earlier to occur of the date the
Company delivers a Placement Notice hereunder (which for such calendar quarter
shall be considered a Representation Date) and the next occurring Representation
Date; provided, however, that such waiver shall not apply for any Representation
Date on which the Company files its annual report on Form 10-K. Notwithstanding
the foregoing, if the Company subsequently decides to sell Placement Shares
following a Representation Date when the Company relied on such waiver and did
not provide MLV with a certificate under this Section 7(l), then before the
Company delivers the Placement Notice or MLV sells any Placement Shares, the
Company shall provide MLV with a certificate, in the form attached hereto as
Exhibit 7(l), dated the date of the Placement Notice.

(m)     Legal Opinion. On or before the date of the initial Placement Notice
given hereunder, the Company shall cause to be furnished to MLV a written
opinion and letter of Cooley LLP or such other counsel reasonably satisfactory
to MLV (“Company Counsel”), covering opinions and statements substantially in
the forms attached hereto as Exhibits 7(m)(1) and 7(m)(2). Thereafter within ten
(10) Trading Days of each Representation Date with respect to which the Company
is obligated to deliver a certificate in the form attached hereto as Exhibit
7(l) for which no waiver is applicable, the Company shall cause to be furnished
to MLV a letter of Company Counsel covering statements substantially in the form
attached hereto as Exhibit 7(m)(2) (such letter, a “Negative Assurance Letter”),
modified, as necessary, to relate to the Registration Statement and the
Prospectus as then amended or supplemented; provided, however, the Company shall
be required to furnish to MLV no more than one Negative Assurance Letter
hereunder per calendar quarter and the Company shall not be required to furnish
such letter if the Company does not intend to deliver a Placement Notice in such
calendar quarter until such time as the Company delivers its next Placement
Notice; provided, further, that in lieu of such letters for subsequent periodic
filings under the Exchange Act, Company Counsel may furnish MLV with a letter (a
“Reliance Letter”) to the effect that MLV may rely on a prior Negative Assurance
Letter delivered under this Section 7(m) to the same extent as if it were dated
the date of such letter (except that statements in such prior letter shall be
deemed to relate to the Registration Statement and the Prospectus as amended or
supplemented as of the date of the Reliance Letter). Notwithstanding anything to
the contrary set forth herein, each obligation of the Company to cause to be
furnished to MLV a Negative Assurance Letter of Company Counsel shall be
conditioned upon the concurrent delivery to MLV by counsel reasonably acceptable
to MLV

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(“MLV Counsel”) of a letter covering statements substantially similar to those
covered by such Negative Assurance Letter of Company Counsel.

(n)     Comfort Letter.  (1) On or before the date of the initial Placement
Notice given hereunder and, thereafter, within ten (10) Trading Days of each
Representation Date, other than pursuant to Section 7(l)(iii), and with respect
to which the Company is obligated to deliver a certificate in the form attached
hereto as Exhibit 7(l) for which no waiver is applicable, the Company shall
cause its independent accountants to furnish MLV letters (the “Comfort
Letters”), dated the date the Comfort Letter is delivered, which shall meet the
requirements set forth in this Section 7(n); provided, that if requested by MLV,
the Company shall cause a Comfort Letter to be furnished to MLV within ten
(10) Trading Days of the date of occurrence of any material transaction or event
(including the restatement of the Company’s financial statements) requiring the
filing of a current report on Form 8-K containing material financial
information, or the date the first Placement Notice is given hereunder following
such a material transaction or event, whichever is later.  The Comfort Letter
from the Company’s independent accountants shall be in a form and substance
reasonably satisfactory to MLV, (i) confirming that they are an independent
public accounting firm within the meaning of the Securities Act and the PCAOB,
(ii) stating, as of such date, the conclusions and findings of such firm with
respect to the financial information and other matters ordinarily covered by
accountants’ “comfort letters” to underwriters in connection with registered
public offerings (the first such letter, the “Initial Comfort Letter”) and (iii)
updating the Initial Comfort Letter with any information that would have been
included in the Initial Comfort Letter had it been given on such date and
modified as necessary to relate to the Registration Statement and the
Prospectus, as amended and supplemented to the date of such letter.

(o)     Market Activities.  The Company will not, directly or indirectly,
(i) take any action designed to cause or result in, or that constitutes or might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of
Placement Shares or (ii) sell, bid for, or purchase Common Stock in violation of
Regulation M, or pay anyone any compensation for soliciting purchases of the
Placement Shares other than MLV.

(p)     Investment Company Act.  The Company will conduct its affairs in such a
manner so as to reasonably ensure that neither it nor any of its Subsidiaries
will be or become, at any time prior to the termination of this Agreement, an
“investment company,” as such term is defined in the Investment Company Act.

(q)     No Offer to Sell.  Neither MLV nor the Company (including its agents and
representatives, other than MLV in their capacity as such) will make, use,
prepare, authorize, approve or refer to any “written communication” which
constitutes a “free writing prospectus” (as such terms are defined in Rule 405
under the Securities Act), required to be filed with the Commission, that
constitutes an offer to sell or solicitation of an offer to buy Placement Shares
hereunder.  Any “free writing prospectus” the use of which has been consented to
in writing by the Company and MLV is hereinafter referred to as a “Permitted
Free Writing Prospectus.”

(r)     Sarbanes-Oxley Act.  The Company and the Subsidiaries will maintain and
keep accurate books and records reflecting their assets and maintain internal
accounting controls

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in a manner designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles and
including those policies and procedures that (i) pertain to the maintenance of
records that in reasonable detail accurately and fairly reflect the transactions
and dispositions of the assets of the Company, (ii) provide reasonable assurance
that transactions are recorded as necessary to permit the preparation of the
Company’s consolidated financial statements in accordance with generally
accepted accounting principals, (iii) that receipts and expenditures of the
Company are being made only in accordance with management’s and the Company’s
directors’ authorization, and (iv) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition
of the Company’s assets that could have a material effect on its financial
statements.  The Company and the Subsidiaries will maintain such controls and
other procedures, including, without limitation, those required by Sections 302
and 906 of the Sarbanes-Oxley Act, and the applicable regulations thereunder
that are designed to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the Exchange Act is
recorded, processed, summarized and reported, within the time periods specified
in the Commission’s rules and forms, including, without limitation, controls and
procedures designed to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the Exchange Act is
accumulated and communicated to the Company’s management, including its
principal executive officer and principal financial officer, or persons
performing similar functions, as appropriate to allow timely decisions regarding
required disclosure and to ensure that material information relating to the
Company or the Subsidiaries is made known to them by others within those
entities, particularly during the period in which such periodic reports are
being prepared.

8.     Representations and Covenants of MLV.  MLV represents and warrants that
it is duly registered as a broker-dealer under FINRA, the Exchange Act and the
applicable statutes and regulations of each state in which the Placement Shares
will be offered and sold, except such states in which MLV is exempt from
registration or such registration is not otherwise required.  MLV shall
continue, for the term of this Agreement, to be duly registered as a
broker-dealer under FINRA, the Exchange Act and the applicable statutes and
regulations of each state in which the Placement Shares will be offered and
sold, except such states in which MLV is exempt from registration or such
registration is not otherwise required, during the term of this Agreement.  MLV
will comply with all applicable laws and regulations in connection with the
Placement Shares, including but not limited to Regulation M under the Exchange
Act.

9.     Payment of Expenses.  The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, filing, including any fees required by the Commission, and printing
of the Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment and supplement thereto and any Permitted
Free Writing Prospectus, in such number as MLV shall deem reasonably necessary,
(ii) the printing and delivery to MLV of this Agreement and such other documents
as may be required in connection with the offering, purchase, sale, issuance or
delivery of the Placement Shares, (iii) the preparation, issuance and delivery
of the certificates, if any, for the Placement Shares to MLV, including any
stock or other transfer taxes and any capital duties, stamp duties or other
duties or taxes payable upon the sale, issuance or delivery of the Placement
Shares to MLV, (iv) the fees and disbursements of the counsel, accountants and

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other advisors to the Company, (v) the reasonable fees and disbursements of the
counsel to MLV, up to a maximum amount of $25,000, (vi) the fees and expenses of
the transfer agent and registrar for the Common Stock, (vii) the filing fees
incident to any review by FINRA of the terms of the sale of the Placement
Shares, and (viii) the fees and expenses incurred in connection with the listing
of the Placement Shares on the Exchange.

10.     Conditions to MLV’s Obligations.  The obligations of MLV hereunder with
respect to a Placement will be subject to the continuing accuracy and
completeness of the representations and warranties made by the Company herein,
to the due performance by the Company of its obligations hereunder, to the
completion by MLV of a due diligence review satisfactory to it in its reasonable
judgment, and to the continuing satisfaction (or waiver by MLV in its sole
discretion) of the following additional conditions:

(a)     Registration Statement Effective.  The Registration Statement shall have
become effective and shall be available for the sale of all Placement Shares
contemplated to be issued by any Placement Notice.

(b)     No Material Notices.  None of the following events shall have occurred
and be continuing:  (i) receipt by the Company of any request for additional
information from the Commission or any other federal or state governmental
authority during the period of effectiveness of the Registration Statement, the
response to which would require any post-effective amendments or supplements to
the Registration Statement or the Prospectus; (ii) the issuance by the
Commission or any other federal or state governmental authority of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose; (iii) receipt by the Company of
any notification with respect to the suspension of the qualification or
exemption from qualification of any of the Placement Shares for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; or (iv) the occurrence of any event that makes any material statement
made in the Registration Statement or the Prospectus or any material document
incorporated or deemed to be incorporated therein by reference untrue in any
material respect or that requires the making of any changes in the Registration
Statement, the Prospectus or documents so that, in the case of the Registration
Statement, it will not contain any materially untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and, that in the case of
the Prospectus, it will not contain any materially untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

(c)     No Misstatement or Material Omission.  MLV shall not have advised the
Company that the Registration Statement or Prospectus, or any amendment or
supplement thereto, contains an untrue statement of fact that in MLV’s
reasonable opinion is material, or omits to state a fact that in MLV’s opinion
is material and is required to be stated therein or is necessary to make the
statements therein not misleading.

(d)     Material Changes.  Except as contemplated in the Prospectus, or
disclosed in the Company’s reports filed with the Commission, there shall not
have been any material adverse change, on a consolidated basis, in the
authorized capital stock of the Company or any

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Material Adverse Effect, or any development that could reasonably be expected to
cause a Material Adverse Effect.

(e)     Legal Opinion and Letters.  MLV shall have received the opinion and
letters, as applicable, of Company Counsel and MLV Counsel required to be
delivered pursuant Section 7(m) on or before the date on which such delivery of
such opinion and letters, as applicable, are required pursuant to Section 7(m).

(f)     Comfort Letter.  MLV shall have received the Comfort Letter required to
be delivered pursuant Section 7(n) on or before the date on which such delivery
of such letter is required pursuant to Section 7(n).

(g)     Representation Certificate.  MLV shall have received the certificate
required to be delivered pursuant to Section 7(l) on or before the date on which
delivery of such certificate is required pursuant to Section 7(l).

(h)     No Suspension.  Trading in the Common Stock shall not have been
suspended on the Exchange and the Common Stock shall not have been delisted from
the Exchange.

(i)     Other Materials.  On each date on which the Company is required to
deliver a certificate pursuant to Section 7(l), the Company shall have furnished
to MLV such appropriate further information, certificates and documents as MLV
may reasonably request.  All such opinions, certificates, letters and other
documents will be in compliance with the provisions hereof.  The Company will
furnish MLV with such conformed copies of such opinions, certificates, letters
and other documents as MLV shall reasonably request.

(j)     Securities Act Filings Made.  All filings with the Commission required
by Rule 424 under the Securities Act to have been filed prior to the issuance of
any Placement Notice hereunder shall have been made within the applicable time
period prescribed for such filing by Rule 424.

(k)     Approval for Listing.  The Placement Shares shall either have been
approved for listing on the Exchange, subject only to notice of issuance, or the
Company shall have filed an application for listing of the Placement Shares on
the Exchange at, or prior to, the issuance of any Placement Notice.

(l)     No Termination Event.  There shall not have occurred any event that
would permit MLV to terminate this Agreement pursuant to Section 13(a).

11.     Indemnification and Contribution.

(a)     Company Indemnification.  The Company agrees to indemnify and hold
harmless MLV, its partners, members, directors, officers, employees and agents
and each person, if any, who controls MLV within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act as follows:

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(i)     against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, joint or several, arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or alleged
omission therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading, or arising out of any untrue
statement or alleged untrue statement of a material fact included in any
Permitted Free Writing Prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;

(ii)     against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, joint or several, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission; provided that any such settlement is effected with the
written consent of the Company, which consent shall not unreasonably be delayed
or withheld; and

(iii)     against any and all expense whatsoever, as incurred (including the
fees and disbursements of counsel), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense is not
paid under (i) or (ii) above,

provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made solely in
reliance upon and in conformity with written information furnished to the
Company by MLV expressly for use in the Registration Statement (or any amendment
thereto), or in any Permitted Free Writing Prospectus or the Prospectus (or any
amendment or supplement thereto).

(b)     MLV Indemnification.  MLV agrees to indemnify and hold harmless the
Company and its directors and each officer of the Company who signed the
Registration Statement, and each person, if any, who (i) controls the Company
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act or (ii) is controlled by or is under common control with the
Company against any and all loss, liability, claim, damage and expense described
in the indemnity contained in Section 11(a), as incurred, but only with respect
to untrue statements or omissions, or alleged untrue statements or omissions,
made in the Registration Statement (or any amendments thereto) or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with
information relating to MLV and furnished to the Company in writing by MLV
expressly for use therein.

(c)     Procedure.  Any party that proposes to assert the right to be
indemnified under this Section 11 will, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim is to
be made against an indemnifying party or parties under this Section 11, notify
each such indemnifying party of the commencement of such

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action, enclosing a copy of all papers served, but the omission so to notify
such indemnifying party will not relieve the indemnifying party from (i) any
liability that it might have to any indemnified party otherwise than under this
Section 11 and (ii) any liability that it may have to any indemnified party
under the foregoing provision of this Section 11 unless, and only to the extent
that, such omission results in the forfeiture of substantive rights or defenses
by the indemnifying party.  If any such action is brought against any
indemnified party and it notifies the indemnifying party of its commencement,
the indemnifying party will be entitled to participate in and, to the extent
that it elects by delivering written notice to the indemnified party promptly
after receiving notice of the commencement of the action from the indemnified
party, jointly with any other indemnifying party similarly notified, to assume
the defense of the action, with counsel reasonably satisfactory to the
indemnified party, and after notice from the indemnifying party to the
indemnified party of its election to assume the defense, the indemnifying party
will not be liable to the indemnified party for any legal or other expenses
except as provided below and except for the reasonable costs of investigation
subsequently incurred by the indemnified party in connection with the
defense.  The indemnified party will have the right to employ its own counsel in
any such action, but the fees, expenses and other charges of such counsel will
be at the expense of such indemnified party unless (1) the employment of counsel
by the indemnified party has been authorized in writing by the indemnifying
party, (2) the indemnified party has reasonably concluded (based on advice of
counsel) that there may be legal defenses available to it or other indemnified
parties that are different from or in addition to those available to the
indemnifying party, (3) a conflict or potential conflict exists (based on advice
of counsel to the indemnified party) between the indemnified party and the
indemnifying party (in which case the indemnifying party will not have the right
to direct the defense of such action on behalf of the indemnified party) or
(4) the indemnifying party has not in fact employed counsel to assume the
defense of such action within a reasonable time after receiving notice of the
commencement of the action, in each of which cases the reasonable fees,
disbursements and other charges of counsel will be at the expense of the
indemnifying party or parties.  It is understood that the indemnifying party or
parties shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the reasonable fees, disbursements and
other charges of more than one separate firm admitted to practice in such
jurisdiction at any one time for all such indemnified party or parties.  All
such fees, disbursements and other charges will be reimbursed by the
indemnifying party promptly after the indemnifying party receives a written
invoice relating to fees, disbursements and other charges in reasonable
detail.  An indemnifying party will not, in any event, be liable for any
settlement of any action or claim effected without its written consent.  No
indemnifying party shall, without the prior written consent of each indemnified
party, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding relating to the matters
contemplated by this Section 11 (whether or not any indemnified party is a party
thereto), unless such settlement, compromise or consent (1) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (2) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.

(d)     Contribution.  In order to provide for just and equitable contribution
in circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 11 is applicable in accordance with its terms but for
any reason is held to be unavailable from the Company or MLV, the Company and
MLV will contribute to the total losses, claims,

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liabilities, expenses and damages (including any investigative, legal and other
expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claim asserted, but after
deducting any contribution received by the Company from persons other than MLV,
such as persons who control the Company within the meaning of the Securities
Act, officers of the Company who signed the Registration Statement and directors
of the Company, who also may be liable for contribution) to which the Company
and MLV may be subject in such proportion as shall be appropriate to reflect the
relative benefits received by the Company on the one hand and MLV on the other
hand.  The relative benefits received by the Company on the one hand and MLV on
the other hand shall be deemed to be in the same proportion as the total net
proceeds from the sale of the Placement Shares (before deducting expenses)
received by the Company bear to the total compensation received by MLV (before
deducting expenses) from the sale of Placement Shares on behalf of the
Company.  If, but only if, the allocation provided by the foregoing sentence is
not permitted by applicable law, the allocation of contribution shall be made in
such proportion as is appropriate to reflect not only the relative benefits
referred to in the foregoing sentence but also the relative fault of the
Company, on the one hand, and MLV, on the other hand, with respect to the
statements or omission that resulted in such loss, claim, liability, expense or
damage, or action in respect thereof, as well as any other relevant equitable
considerations with respect to such offering.  Such relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or MLV, the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission.  The Company and
MLV agree that it would not be just and equitable if contributions pursuant to
this Section 11(d) were to be determined by pro rata allocation or by any other
method of allocation that does not take into account the equitable
considerations referred to herein.  The amount paid or payable by an indemnified
party as a result of the loss, claim, liability, expense, or damage, or action
in respect thereof, referred to above in this Section 11(d) shall be deemed to
include, for the purpose of this Section 11(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim to the extent consistent with
Section 11(c) hereof.  Notwithstanding the foregoing provisions of this
Section 11(d), MLV shall not be required to contribute any amount in excess of
the commissions received by it under this Agreement and no person found guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.  For purposes of this
Section 11(d), any person who controls a party to this Agreement within the
meaning of the Securities Act, and any officers, directors, partners, employees
or agents of MLV, will have the same rights to contribution as that party, and
each officer and director of the Company who signed the Registration Statement
will have the same rights to contribution as the Company, subject in each case
to the provisions hereof.  Any party entitled to contribution, promptly after
receipt of notice of commencement of any action against such party in respect of
which a claim for contribution may be made under this Section 11(d), will notify
any such party or parties from whom contribution may be sought, but the omission
to so notify will not relieve that party or parties from whom contribution may
be sought from any other obligation it or they may have under this Section 11(d)
except to the extent that the failure to so notify such other party materially
prejudiced the substantive rights or defenses of the party from whom
contribution is sought.  Except for a settlement entered into pursuant to the
last sentence of

28

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Section 11(c) hereof, no party will be liable for contribution with respect to
any action or claim settled without its written consent if such consent is
required pursuant to Section 11(c) hereof.

12.     Representations and Agreements to Survive Delivery.  The indemnity and
contribution agreements contained in Section 11 of this Agreement and all
representations and warranties of the Company and MLV herein or in certificates
delivered pursuant hereto shall survive, as of their respective dates,
regardless of (i) any investigation made by or on behalf of MLV, any controlling
persons, or the Company (or any of their respective officers, directors or
controlling persons), (ii) delivery and acceptance of the Placement Shares and
payment therefor or (iii) any termination of this Agreement.

13.     Termination.

(a)     MLV may terminate this Agreement, by notice to the Company, as
hereinafter specified at any time (1) if there has been, since the time of
execution of this Agreement or since the date as of which information is given
in the Prospectus, any Material Adverse Effect, or any development that has
occurred that is reasonably likely to have a Material Adverse Effect has
occurred or in the sole judgment of MLV makes it impractical or inadvisable to
market the Placement Shares or to enforce contracts for the sale of the
Placement Shares, (2) if there has occurred any material adverse change in the
financial markets in the United States or the international financial markets,
any outbreak of hostilities or escalation thereof or other calamity or crisis or
any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the sole judgment of MLV,
impracticable or inadvisable to market the Placement Shares or to enforce
contracts for the sale of the Placement Shares, (3) if trading in the Common
Stock has been suspended or limited by the Commission or the Exchange, or if
trading generally on the Exchange has been suspended or limited, or minimum
prices for trading have been fixed on the Exchange, (4) if any suspension of
trading of any securities of the Company on any exchange or in the
over-the-counter market shall have occurred and be continuing, (5) if a major
disruption of securities settlements or clearance services in the United States
shall have occurred and be continuing, or (6) if a banking moratorium has been
declared by either U.S. Federal or New York authorities.  Any such termination
shall be without liability of any party to any other party except that the
provisions of Section 9 (Expenses), Section 11 (Indemnification), Section 12
(Survival of Representations), Section 18 (Applicable Law; Waiver of Jury Trial)
and Section 19 (Consent to Jurisdiction) hereof shall remain in full force and
effect notwithstanding such termination.  If MLV elects to terminate this
Agreement as provided in this Section 13(a), MLV shall provide the required
notice as specified in Section 14 (Notices).

(b)     The Company shall have the right, by giving ten (10) days notice as
hereinafter specified to terminate this Agreement in its sole discretion at any
time after the date of this Agreement.  Any such termination shall be without
liability of any party to any other party except that the provisions of
Section 9, Section 11, Section 12, Section 18 and Section 19 hereof shall remain
in full force and effect notwithstanding such termination.

(c)     MLV shall have the right, by giving ten (10) days notice as hereinafter
specified to terminate this Agreement in its sole discretion at any time after
the date of this Agreement.  Any such termination shall be without liability of
any party to any other party

29

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except that the provisions of Section 9, Section 11, Section 12, Section 18 and
Section 19 hereof shall remain in full force and effect notwithstanding such
termination.

(d)     Unless earlier terminated pursuant to this Section 13, this Agreement
shall automatically terminate upon the issuance and sale of all of the Placement
Shares through MLV on the terms and subject to the conditions set forth herein
except that the provisions of Section 9, Section 11, Section 12, Section 18 and
Section 19 hereof shall remain in full force and effect notwithstanding such
termination.

(e)     This Agreement shall remain in full force and effect unless terminated
pursuant to Sections 13(a), (b), (c), or (d) above or otherwise by mutual
agreement of the parties; provided, however, that any such termination by mutual
agreement shall in all cases be deemed to provide that Section 9, Section 11,
Section 12, Section 18 and Section 19 shall remain in full force and
effect.  Upon termination of this Agreement, the Company shall not have any
liability to MLV for any discount, commission or other compensation with respect
to any Shares not otherwise sold by MLV under this Agreement.

(f)     Any termination of this Agreement shall be effective on the date
specified in such notice of termination; provided, however, that such
termination shall not be effective until the close of business on the date of
receipt of such notice by MLV or the Company, as the case may be.  If such
termination shall occur prior to the Settlement Date for any sale of Placement
Shares, such Placement Shares shall settle in accordance with the provisions of
this Agreement.

14.     Notices.  All notices or other communications required or permitted to
be given by any party to any other party pursuant to the terms of this Agreement
shall be in writing, unless otherwise specified, and if sent to MLV, shall be
delivered to:

 

MLV & Co. LLC

 

 

1251 Avenue of the Americas, 41st Floor

 

 

New York, NY 10020

 

 

Telephone:

(212) 542-5870

 

Facsimile:

(212) 317-1515

 

Attention:

General Counsel

 

 

 

with a copy to (which shall not constitute notice):

 

 

 

 

 

LeClairRyan, A Professional Corporation

 

 

885 Third Avenue

 

 

New York, NY 10022

 

 

Telephone:

(973) 491-3315

 

Attention:

James T. Seery

 

 

 

and if to the Company, shall be delivered to:

 

 

 

 

 

Threshold Pharmaceuticals, Inc.

 

 

170 Harbor Way, Suite 300

 

 

South San Francisco, CA 94080

 

30

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Telephone:

(650) 474-8200

 

Facsimile:

(650) 474-2529

 

Attention:

Harold E. Selick, Ph.D., Chief Executive Officer

 

 

 

with a copy to  (which shall not constitute notice):

 

 

 

 

 

Cooley LLP

 

 

3175 Hanover Street

 

 

Palo Alto, CA 94304

 

 

Telephone:

(650) 843-5654

 

Facsimile:

(650) 849-7400

 

Attention:

Chadwick L. Mills

 

Each party to this Agreement may change such address for notices by sending to
the parties to this Agreement written notice of a new address for such
purpose.  Each such notice or other communication shall be deemed given (i) when
delivered personally or by verifiable facsimile transmission (with an original
to follow) on or before 4:30 p.m., New York City time, on a Business Day or, if
such day is not a Business Day, on the next succeeding Business Day, (ii) on the
next Business Day after timely delivery to a nationally-recognized overnight
courier and (iii) on the Business Day actually received if deposited in the U.S.
mail (certified or registered mail, return receipt requested, postage
prepaid).  For purposes of this Agreement, “Business Day” shall mean any day on
which the Exchange and commercial banks in the City of New York are open for
business.

An electronic communication (“Electronic Notice”) shall be deemed written notice
for purposes of this Section 14 if sent to the electronic mail address specified
by the receiving party under separate cover.  Electronic Notice shall be deemed
received at the time the party sending Electronic Notice receives confirmation
of receipt by the receiving party.  Any party receiving Electronic Notice may
request and shall be entitled to receive the notice on paper, in a nonelectronic
form (“Nonelectronic Notice”) which shall be sent to the requesting party within
ten (10) days of receipt of the written request for Nonelectronic Notice.

15.     Successors and Assigns.  This Agreement shall inure to the benefit of
and be binding upon the Company and MLV and their respective successors and the
affiliates, controlling persons, officers and directors referred to in
Section 11 hereof.  References to any of the parties contained in this Agreement
shall be deemed to include the successors and permitted assigns of such
party.  Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the parties hereto or their respective successors and
permitted assigns any rights, remedies, obligations or liabilities under or by
reason of this Agreement, except as expressly provided in this
Agreement.  Neither party may assign its rights or obligations under this
Agreement without the prior written consent of the other party.

16.     Adjustments for Stock Splits.  The parties acknowledge and agree that
all share-related numbers contained in this Agreement shall be adjusted to take
into account any share consolidation, stock split, stock dividend, corporate
domestication or similar event effected with respect to the Placement Shares.

31

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17.     Entire Agreement; Amendment; Severability.  This Agreement (including
all schedules and exhibits attached hereto and Placement Notices issued pursuant
hereto), together with that certain side letter agreement between the Company
and MLV dated the date hereof and that certain Confidentiality Agreement, dated
July 23, 2014, by and between the Company and MLV (the “CDA”), constitute the
entire agreement of the parties with respect to the subject matter hereof and
supersedes all other prior and contemporaneous agreements and undertakings, both
written and oral, among the parties hereto with regard to the subject matter
hereof. Moreover, the Company and MLV agree that all exchanges of information
hereunder shall be governed by the terms of the CDA, which CDA the parties agree
is and shall hereby be amended to remain in full force and effect at all times
during the term of this Agreement. Neither this Agreement nor any term hereof
may be amended except pursuant to a written instrument executed by the Company
and MLV. In the event that any one or more of the provisions contained herein,
or the application thereof in any circumstance, is held invalid, illegal or
unenforceable as written by a court of competent jurisdiction, then such
provision shall be given full force and effect to the fullest possible extent
that it is valid, legal and enforceable, and the remainder of the terms and
provisions herein shall be construed as if such invalid, illegal or
unenforceable term or provision was not contained herein, but only to the extent
that giving effect to such provision and the remainder of the terms and
provisions hereof shall be in accordance with the intent of the parties as
reflected in this Agreement.

18.     GOVERNING LAW AND TIME; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.  SPECIFIED TIMES OF DAY
REFER TO NEW YORK CITY TIME.  THE COMPANY HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.

32

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19.     CONSENT TO JURISDICTION.  EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY
OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION WITH ANY TRANSACTION CONTEMPLATED HEREBY, AND HEREBY
IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING,
ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH
COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM
OR THAT THE VENUE OF SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH PARTY
HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS
BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY THEREOF
(CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED) TO SUCH PARTY AT THE
ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH
SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE
THEREOF.  NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT
TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.

20.     Use of Information.  MLV may not use any information gained in
connection with this Agreement and the transactions contemplated by this
Agreement, including due diligence, to advise any party with respect to
transactions not expressly approved by the Company.

21.     Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.  Delivery of an executed
Agreement by one party to the other may be made by facsimile transmission.

22.     Effect of Headings.

The section and Exhibit headings herein are for convenience only and shall not
affect the construction hereof.

23.     Absence of Fiduciary Relationship.

The Company acknowledges and agrees that:

(a)     MLV is acting solely as agent in connection with the public offering of
the Placement Shares and in connection with each transaction contemplated by
this Agreement and the process leading to such transactions, and no fiduciary or
advisory relationship between the Company or any of its respective affiliates,
stockholders (or other equity holders), creditors or employees or any other
party, on the one hand, and MLV, on the other hand, has been or will be created
in respect of any of the transactions contemplated by this Agreement,
irrespective of whether or not MLV has advised or is advising the Company on
other matters, and MLV has no obligation to the Company with respect to the
transactions contemplated by this Agreement except the obligations expressly set
forth in this Agreement;

33

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(b)     it is capable of evaluating and understanding, and understands and
accepts, the terms, risks and conditions of the transactions contemplated by
this Agreement;

(c)     MLV has not provided any legal, accounting, regulatory or tax advice
with respect to the transactions contemplated by this Agreement and it has
consulted its own legal, accounting, regulatory and tax advisors to the extent
it has deemed appropriate;

(d)     it is aware that MLV and its affiliates are engaged in a broad range of
transactions which may involve interests that differ from those of the Company
and MLV has no obligation to disclose such interests and transactions to the
Company by virtue of any fiduciary, advisory or agency relationship or
otherwise; and

(e)     it waives, to the fullest extent permitted by law, any claims it may
have against MLV for breach of fiduciary duty or alleged breach of fiduciary
duty in connection with the sale of Placement Shares under this Agreement and
agrees that MLV shall not have any liability (whether direct or indirect, in
contract, tort or otherwise) to it in respect of such a fiduciary duty claim or
to any person asserting a fiduciary duty claim on its behalf or in right of it
or the Company, employees or creditors of Company, other than in respect of
MLV’s obligations under this Agreement and to keep information provided by the
Company to MLV and MLV’s counsel confidential to the extent not otherwise
publicly-available.

24.     Definitions.

As used in this Agreement, the following terms have the respective meanings set
forth below:

“Applicable Time” means (i) each Representation Date and (ii) the time of each
sale of any Placement Shares pursuant to this Agreement.

All references in this Agreement to financial statements and schedules and other
information that is “contained,” “included” or “stated” in the Registration
Statement or the Prospectus (and all other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information that is incorporated by reference in the Registration Statement or
the Prospectus, as the case may be.

All references in this Agreement to the Registration Statement, the Prospectus
or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to EDGAR; all references in
this Agreement to any Issuer Free Writing Prospectus (other than any Issuer Free
Writing Prospectuses that, pursuant to Rule 433, are not required to be filed
with the Commission) shall be deemed to include the copy thereof filed with the
Commission pursuant to EDGAR; and all references in this Agreement to
“supplements” to the Prospectus shall include, without limitation, any
supplements, “wrappers” or similar materials prepared in connection with any
offering, sale or private placement of any Placement Shares by MLV outside of
the United States.

[Remainder of page intentionally left blank.]

 

34

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If the foregoing correctly sets forth the understanding between the Company and
MLV, please so indicate in the space provided below for that purpose, whereupon
this letter shall constitute a binding agreement between the Company and MLV.

 

 

Very truly yours,

 

 

 

THRESHOLD PHARMACEUTICALS, INC.

 

 

By:

/s/ Harold E. Selick, Ph.D

 

Name:  Harold E. Selick, Ph.D.

 

Title:  Chief Executive Officer

 

 

ACCEPTED as of the date first-above written:

 

 

MLV & CO. LLC

 

 

By:

/s/  Dean Colucci

 

Name:  Dean Colucci

 

Title:  President

 

 

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SCHEDULE 1

 

 

FORM OF PLACEMENT NOTICE

 

 

 

 

 

From:

Threshold Pharmaceuticals, Inc.

 

 

To:

MLV & Co. LLC

 

 

Attention:

Patrice McNicoll

 

 

Subject:

At Market Issuance—Placement Notice

 

Gentlemen:

Pursuant to the terms and subject to the conditions contained in the At Market
Issuance Sales Agreement between Threshold Pharmaceuticals, Inc., a Delaware
corporation (the “Company”) and MLV & Co. LLC (“MLV”), dated August 1, 2014, the
Company hereby requests that MLV sell up to of the Company’s Common Stock, no
par value per share, at a minimum market price of $ per share, during the time
period beginning [month, day, time] and ending [month, day, time].

 

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SCHEDULE 2

 

 

Compensation

 

 

 

The Company shall pay to MLV in cash, upon each sale of Placement Shares
pursuant to this Agreement, an amount equal to up to 3.0% of the gross proceeds
from each sale of Placement Shares.

 

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SCHEDULE 3

 

 

Notice Parties

 

 

 

The Company

Harold E. Selick, Ph.D.bselick@thresholdpharm.com

Joel A. Fernandesjfernandes@thresholdpharm.com

MLV

Randy Billhardtrbillhardt@mlvco.com

Dean Coluccidcolucci@mlvco.com

Ryan Loforterloforte@mlvco.com

Patrice McNicollpmcnicoll@mlvco.com

Miranda Toledanomtoledano@mlvco.com

With a copy to mlvatmdesk@mlvco.com

 

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SCHEDULE 4

 

 

Subsidiaries

 

 

 

THLD Enterprises (UK), Limited

 

--------------------------------------------------------------------------------

EXHIBIT 7(l)

Form of Representation Date Certificate

This Officers Certificate (this “Certificate”) is executed and delivered in
connection with Section 7(l) of the At Market Issuance Sales Agreement (the
“Agreement”), dated August 1, 2014, and entered into between Threshold
Pharmaceuticals, Inc. (the “Company”) and MLV & Co. LLC.  All capitalized terms
used but not defined herein shall have the meanings given to such terms in the
Agreement

The undersigned, a duly appointed and authorized officer of the Company, having
made reasonable inquiries to establish the accuracy of the statements below and
having been authorized by the Company to execute this certificate on behalf of
the Company, hereby certifies, on behalf of the Company and not in the
undersigned’s individual capacity, as follows:

1.As of the date of this Certificate, (i) the Registration Statement does not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading and (ii) neither the Registration Statement nor the
Prospectus contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading and (iii) no event has occurred as a result of which it is
necessary to amend or supplement the Prospectus in order to make the statements
therein not untrue or misleading for (i) and (ii) to be true.

2.Each of the representations and warranties of the Company contained in the
Agreement was true and correct in all material respects, when originally made,
and, except for those representations and warranties that speak solely as of a
specific date, are true and correct in all material respects as of the date of
this Certificate.

3.Except as waived by MLV in writing, each of the covenants required to be
performed by the Company in the Agreement on or prior to the date of the
Agreement, this Representation Date, and each such other date prior to the date
hereof as set forth in the Agreement, has been duly, timely and fully performed
in all material respects and each condition required to be complied with by the
Company on or prior to the date of the Agreement, this Representation Date, and
each such other date prior to the date hereof as set forth in the Agreement has
been duly, timely and fully complied with in all material respects.

4.Subsequent to the date of the most recent financial statements in the
Prospectus, and except as described in the Prospectus, including Incorporated
Documents, there has been no material adverse change.

5.No stop order suspending the effectiveness of the Registration Statement or of
any part thereof has been issued, and no proceedings for that purpose have been
instituted or are pending or threatened by any securities or other governmental
authority (including, without limitation, the Commission).

6.No order suspending the effectiveness of the Registration Statement or the
qualification or registration of the Placement Shares under the securities or
Blue Sky laws of any

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jurisdiction are in effect and no proceeding for such purpose is pending before,
or threatened, to the Company’s knowledge or in writing by, any securities or
other governmental authority (including, without limitation, the Commission).

The undersigned has executed this Officer’s Certificate on behalf of the Company
as of the date first written above.

 

 

THRESHOLD PHARMACEUTICALS, INC.

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

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EXHIBIT 7(m)(1)

Form of Legal Opinion

 

--------------------------------------------------------------------------------

 

EXHIBIT 7(m)(2)

Form of Legal Letter