Document:

EX-4.2.1

 EXHIBIT 4.2.1 
  

 
  

CAPITAL ONE MULTI-ASSET EXECUTION TRUST 

as Issuer 
 and 

THE BANK OF NEW YORK MELLON 

as Indenture Trustee 
 CLASS A(2016-5) TERMS DOCUMENT 
 dated as of August 25, 2016 

TO 
 CARD SERIES
INDENTURE SUPPLEMENT 
 dated as of October 9, 2002, 

as amended and restated as of March 17, 2016 

TO 
 ASSET POOL
1 SUPPLEMENT 
 dated as of October 9, 2002, 

as amended by the First Amendment thereto dated as of March 1, 2008 

to 
 INDENTURE 

dated as of October 9, 2002, as amended and restated as of January 13, 2006, 

and March 17, 2016 
  

 
  

 TABLE OF CONTENTS 

 

							
	 	 	 	  	Page	 
	 ARTICLE I
	 	 Definitions and Other Provisions of General Application
	  	 	1	  
			
	 Section 1.01.
	 	 Definitions
	  	 	1	  
	 Section 1.02.
	 	 Governing Law
	  	 	7	  
	 Section 1.03.
	 	 Counterparts
	  	 	7	  
	 Section 1.04.
	 	 Ratification of Indenture, Asset Pool 1 Supplement and Indenture Supplement
	  	 	7	  
			
	 ARTICLE II
	 	 The Class A(2016-5) Notes
	  	 	8	  
			
	 Section 2.01.
	 	 Creation and Designation
	  	 	8	  
	 Section 2.02.
	 	 Adjustments to Required Subordinated Percentages
	  	 	8	  
	 Section 2.03.
	 	 Interest Payment
	  	 	8	  
	 Section 2.04.
	 	 [Reserved]
	  	 	9	  
	 Section 2.05.
	 	 Payments of Interest and Principal
	  	 	9	  
	 Section 2.06.
	 	 Form of Delivery of Class A(2016-5) Notes; Depository; Denominations
	  	 	9	  
	 Section 2.07.
	 	 Delivery and Payment for the Class A(2016-5) Notes
	  	 	9	  
	 Section 2.08.
	 	 Targeted Deposits to the Accumulation Reserve Account
	  	 	10	  

  
 i 

 THIS CLASS A(2016-5) TERMS DOCUMENT (this “Terms
Document”), by and between CAPITAL ONE MULTI-ASSET EXECUTION TRUST, a statutory trust created under the laws of the State of Delaware (the “Issuer”), having its principal office at
E. A. Delle Donne Corporate Center, Montgomery Building, 1011 Centre Road, Wilmington, DE 19805 and THE BANK OF NEW YORK MELLON, a New York banking corporation, as Indenture Trustee (the “Indenture Trustee”), is made and
entered into as of August 25, 2016. 
 Pursuant to this Terms Document, the Issuer shall create a new tranche of Class A Notes and
shall specify the principal terms thereof. 
 ARTICLE I 

Definitions and Other Provisions of General Application 

Section 1.01. Definitions. For all purposes of this Terms Document, except as otherwise expressly provided or unless the
context otherwise requires: 
  

	 	(1)	the terms defined in this Article have the meanings assigned to them in this Article, and include the plural as well as the singular; 

 

	 	(2)	all other terms used herein which are defined in the Indenture Supplement, the Asset Pool 1 Supplement or the Indenture, either directly or by reference therein, have the meanings assigned to them therein;

  

	 	(3)	all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles and, except as otherwise herein expressly provided, the term
“generally accepted accounting principles” with respect to any computation required or permitted hereunder means such accounting principles as are generally accepted in the United States of America at the date of such computation;

  

	 	(4)	all references in this Terms Document to designated “Articles,” “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of this Terms Document;

  

	 	(5)	the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Terms Document as a whole and not to any particular Article, Section or other subdivision;

  

	 	(6)	in the event that any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Indenture Supplement, the Asset Pool 1 Supplement, the Indenture or the
Transfer and Administration Agreement, the terms and provisions of this Terms Document shall be controlling; 

  
 1 

	 	(7)	each capitalized term defined herein shall relate only to the Class A(2016-5) Notes and no other Tranche of Notes issued by the Issuer; and 

 

	 	(8)	“including” and words of similar import will be deemed to be followed by “without limitation.” 

“Accumulation Period Amount” means $52,083,333.34; provided, however, if the Accumulation Period Length is
determined to be less than twelve (12) months pursuant to Section 3.10(b)(ii) of the Indenture Supplement, the Accumulation Period Amount shall be the amount specified in the definition of “Accumulation Period Amount” in
the Indenture Supplement. 
 “Accumulation Reserve Funding Period” shall mean, (a) if the Accumulation Period Length
is determined to be one (1) month, there shall be no Accumulation Reserve Funding Period and (b) otherwise, the period (x) commencing on the earliest to occur of (i) the Monthly Period beginning three (3) calendar months
prior to the first Distribution Date for which a budgeted deposit is targeted to be made into the Principal Funding sub-Account of the Class A(2016-5) Notes
pursuant to Section 3.10(b) of the Indenture Supplement, (ii) the Monthly Period following the first Distribution Date following and including the July 2019 Distribution Date for which the Quarterly Excess Spread Percentage is less
than 2%, but in such event the Accumulation Reserve Funding Period shall not be required to commence earlier than 12 months prior to the first Distribution Date for which a budgeted deposit is targeted to be made into the Principal Funding
sub-Account for the Class A(2016-5) Notes pursuant to Section 3.10(b) of the Indenture Supplement, (iii) the Monthly Period following the first Distribution Date following and including the
January 2020 Distribution Date for which the Quarterly Excess Spread Percentage is less than 3%, but in such event the Accumulation Reserve Funding Period shall not be required to commence earlier than 6 months prior to the first Distribution Date
for which a budgeted deposit is targeted to be made into the Principal Funding sub-Account for the Class A(2016-5) Notes pursuant to Section 3.10(b) of
the Indenture Supplement, and (iv) the Monthly Period following the first Distribution Date following and including the March 2020 Distribution Date for which the Quarterly Excess Spread Percentage is less than 4%, but in such event the
Accumulation Reserve Funding Period shall not be required to commence earlier than 4 months prior to the first Distribution Date for which a budgeted deposit is targeted to be made into the Principal Funding
sub-Account for the Class A(2016-5) Notes pursuant to Section 3.10(b) of the Indenture Supplement and (y) ending on the close of business on the
last day of the Monthly Period preceding the earlier to occur of (i) the Expected Principal Payment Date for the Class A(2016-5) Notes and (ii) the date on which the Class A(2016-5) Notes are paid in full. 
 “Asset Pool 1 Supplement” means the Asset
Pool 1 Supplement dated as of October 9, 2002, as amended by the First Amendment thereto, dated as of March 1, 2008, by and between the Issuer and the Indenture Trustee, as amended and supplemented from time to time. 

  
 2 

 “Base Rate” means, with respect to any Monthly Period, the sum of (a) the
Card Series Servicing Fee Percentage and (b) the weighted average (based on the Outstanding Dollar Principal Amount of the related Card Series Notes) of the following: 

(i) in the case of a Tranche of Card Series Dollar Interest-bearing Notes with no
Derivative Agreement for interest, the rate of interest applicable to such Tranche for the period from and including the Monthly Interest Accrual Date for such Tranche of Card Series Dollar Interest-bearing
Notes in such Monthly Period to but excluding the Monthly Interest Accrual Date for such Tranche of Card Series Dollar Interest-bearing Notes in the following Monthly Period; 

(ii) in the case of a Tranche of Card Series Discount Notes, the rate of accretion (converted to an accrual rate) of such
Tranche for the period from and including the Monthly Interest Accrual Date for such Tranche of Card Series Discount Notes in such Monthly Period to but excluding the Monthly Interest Accrual Date for such Tranche of Card Series Discount Notes in
the following Monthly Period; 
 (iii) in the case of a Tranche of Card Series Notes with a Performing Derivative Agreement
for interest, the rate at which payments by the Issuer to the applicable Derivative Counterparty accrue (prior to the netting of such payments, if applicable) for the period from and including the Monthly Interest Accrual Date for such Tranche of
Card Series Notes in such Monthly Period to but excluding the Monthly Interest Accrual Date for such Tranche of Card Series Notes in the following Monthly Period; provided, however, that in the case of a Tranche of Card Series Notes with a
Performing Derivative Agreement for interest in which the rating on such Tranche of Card Series Notes is not dependant upon the rating of the applicable Derivative Counterparty, the amount determined pursuant to this clause (iii) will be the
higher of (1) the rate determined pursuant to this clause (iii) above and (2) the rate of interest applicable to such Tranche for the period from and including the Monthly Interest Accrual Date for such Tranche of Card Series Notes in
such Monthly Period to but excluding the Monthly Interest Accrual Date for such Tranche of Card Series Notes in the following Monthly Period; and 

(iv) in the case of a tranche of Card Series Notes with a non-Performing Derivative
Agreement for interest, the rate specified for that date in the related Terms Document. 

“Class A(2016-5) Adverse Event” means the occurrence of any of the following:
(a) an Early Redemption Event with respect to the Class A(2016-5) Notes or (b) an Event of Default and acceleration of the Class A(2016-5) Notes.

 “Class A(2016-5) Note” means any Note, substantially in the form set forth
in Exhibit A-2 to the Indenture Supplement, designated therein as a Class A(2016-5) Note and duly executed and authenticated in accordance with the
Indenture. 
 “Class A(2016-5) Noteholder” means a Person in whose name a Class A(2016-5) Note is registered in the Note Register. 

“Class A(2016-5) Termination Date” means the earliest to occur of (a) the
Principal Payment Date on which the Outstanding Dollar Principal Amount of the Class A(2016-5) Notes is paid in full, (b) the Legal Maturity Date and (c) the date on which the Indenture is
discharged and satisfied pursuant to Article VI thereof. 

  
 3 

 “Excess Spread Percentage” shall mean, with respect to any Distribution Date,
the amount, if any, by which the Portfolio Yield for the preceding Monthly Period exceeds the Base Rate for such Monthly Period. 

“Expected Principal Payment Date” means August 16, 2021. 

“Initial Dollar Principal Amount” means $625,000,000. 

“Indenture” means the Indenture dated as of October 9, 2002, as amended and restated as of January 13, 2006, and
March 17, 2016, by and between the Issuer and the Indenture Trustee, as amended and supplemented from time to time. 

“Indenture Supplement” means the Card Series Indenture Supplement dated as of October 9, 2002, as amended and restated
as of March 17, 2016, by and between the Issuer and the Indenture Trustee, as amended and supplemented from time to time. 

“Interest Payment Date” means the fifteenth day of each month, commencing in October 2016, or if such fifteenth day is
not a Business Day, the next succeeding Business Day. 
 “Interest Period” means, with respect to any Interest Payment
Date, the period from and including the previous Interest Payment Date (or in the case of the initial Interest Payment Date, from and including the Issuance Date) through the day preceding such Interest Payment Date. 

“Issuance Date” means August 25, 2016. 

“Legal Maturity Date” means June 17, 2024. 

“Maximum Subordination Amount of Class B Notes” means, for the Class A(2016-5)
Notes for any date of determination, an amount equal to the product of (a) Adjusted Outstanding Dollar Principal Amount of the Class A(2016-5) Notes on such date of determination and (b) the
percentage equivalent of a fraction, the numerator of which is 9 and the denominator of which is 79.00. 
 “Note Interest
Rate” means a rate per annum equal to 1.66%. 
 “Paying Agent” means The Bank of New York Mellon. 

“Portfolio Yield” means, with respect to any Monthly Period, the annualized percentage equivalent of a fraction: 

(a) the numerator of which is equal to the sum of: 

(i) the aggregate amount of Finance Charge Amounts allocated to the Card Series with respect to such Monthly Period;
plus 

  
 4 

 (ii) the aggregate amount of Interest Funding
sub-Account Earnings on all Tranches of Card Series Notes for such Monthly Period; plus 

(iii) any amounts to be treated as Card Series Finance Charge Amounts pursuant to Sections 3.20(d) and 3.27(a) of
the Indenture Supplement; minus 
 (iv) the excess, if any, of (1) the sum of the PFA Prefunding Earnings
Shortfall plus the PFA Accumulation Earnings Shortfall over (2) the sum of the aggregate amount to be treated as Card Series Finance Charge Amounts for such Monthly Period pursuant to Sections 3.04(a)(ii) and 3.25(a) of the
Indenture Supplement plus any other amounts applied to cover earnings shortfalls on amounts in the Principal Funding sub-Account for any tranche of Card Series Notes for such Monthly Period;
minus 
 (v) the Card Series Default Amount for such Monthly Period; and 

(b) the denominator of which is the numerator used in the calculation of the Card Series Floating Allocation Percentage for such Monthly
Period. 
 “Quarterly Excess Spread Percentage” means, with respect to the July 2019 Distribution Date and each
Distribution Date thereafter, the percentage equivalent of a fraction the numerator of which is the sum of the Excess Spread Percentages with respect to the immediately preceding three Monthly Periods and the denominator of which is three. 

“Record Date” means, for any Distribution Date, the last day of the preceding Monthly Period. 

“Required Accumulation Reserve sub-Account Amount” means, with respect to any Monthly
Period during the Accumulation Reserve Funding Period, an amount equal to (i) 0.5% of the Outstanding Dollar Principal Amount of the Class A(2016-5) Notes as of the close of business on the last day
of the preceding Monthly Period or (ii) any other amount designated by the Issuer; provided, however, that if such designation is of a lesser amount, the Note Rating Agencies shall have provided prior written confirmation that a
Ratings Effect will not occur with respect to such change. 
 “Required Subordinated Amount of Class B Notes” means, for
the Class A(2016-5) Notes for any date of determination, an amount equal to the product of (a) the Required Subordinated Percentage of Class B Notes for such
Class A(2016-5) Notes on such date of determination and (b) the Adjusted Outstanding Dollar Principal Amount of such Class A(2016-5) Notes on such date of
determination; provided, however, that such an amount shall not exceed the Maximum Subordination Amount of Class B Notes for the Class A(2016-5) Notes; provided further,
however, that for any date of determination on or after the occurrence and during the continuation of a Class A(2016-5) Adverse Event, the Required Subordinated

  
 5 

 
Amount of Class B Notes for the Class A(2016-5) Notes will be the greater of (x) the amount determined above for such date of determination and
(y) the amount determined above for the date immediately prior to the date on which such Class A(2016-5) Adverse Event shall have occurred. 

“Required Subordinated Amount of Class C Notes” means, for the Class A(2016-5)
Notes for any date of determination, an amount equal to the product of (a) the Required Subordinated Percentage of Class C Notes for such Class A(2016-5) Notes on such date of determination and
(b) the Adjusted Outstanding Dollar Principal Amount of such Class A(2016-5) Notes on such date of determination; provided, however, that for any date of determination, unless
(i) the Prefunding Target Amount for any Tranche of Card Series Notes on such date of determination is greater than zero or (ii) any prefunded amounts are on deposit in a Principal Funding
sub-Account on such date of determination for any Tranche of Card Series Notes, the Required Subordinated Amount of Class C Notes for the Class A(2016-5) Notes will
not be less than an amount equal to (i) 3.0% of the Initial Dollar Principal Amount of the Class A(2016-5) Notes, minus (ii) the Required Subordinated Amount of Class D Notes for the Class A(2016-5) Notes; provided further, however, that for any date of determination on or after the occurrence and during the continuation of a
Class A(2016-5) Adverse Event, the Required Subordinated Amount of Class C Notes for the Class A(2016-5) Notes will be the greater of (x) the amount
determined above for such date of determination, (y) the amount determined above for the date immediately prior to the date on which such Class A(2016-5) Adverse Event shall have occurred and
(z) unless (i) the Prefunding Target Amount for any Tranche of Card Series Notes on such date of determination is greater than zero or (ii) any prefunded amounts are on deposit in a Principal Funding
sub-Account on such date of determination for any Tranche of Card Series Notes, the amount determined pursuant to the preceding proviso. 

“Required Subordinated Amount of Class D Notes” means, for the Class A(2016-5)
Notes for any date of determination, an amount equal to the product of (a) the Required Subordinated Percentage of Class D Notes for such Class A(2016-5) Notes on such date of determination and
(b) the Adjusted Outstanding Dollar Principal Amount of such Class A(2016-5) Notes on such date of determination; provided, however, that for any date of determination, unless
(i) the Prefunding Target Amount for any Tranche of Card Series Notes on such date of determination is greater than zero or (ii) any prefunded amounts are on deposit in a Principal Funding
sub-Account on such date of determination for any Tranche of Card Series Notes, the Required Subordinated Amount of Class D Notes for the Class A(2016-5) Notes will
not be less than an amount equal to 1.2049% of the Initial Dollar Principal Amount of the Class A(2016-5) Notes, provided further, however, that for any date of determination on or
after the occurrence and during the continuation of a Class A(2016-5) Adverse Event, the Required Subordinated Amount of Class D Notes for the Class A(2016-5)
Notes will be the greatest of (x) the amount determined above for such date of determination, (y) the amount determined above for the date immediately prior to the date on which such
Class A(2016-5) Adverse Event shall have occurred and (z) unless (i) the Prefunding Target Amount for any Tranche of Card Series Notes on such date of determination is greater than zero or
(ii) any prefunded amounts are on deposit in a Principal Funding sub-Account on such date of determination for any Tranche of Card Series Notes, the amount determined pursuant to the preceding proviso.

  
 6 

 “Required Subordinated Percentage of Class B Notes” means, for the Class A(2016-5) Notes, 11.3925%, subject to adjustment in accordance with Section 2.02. 

“Required Subordinated Percentage of Class C Notes” means, for the
Class A(2016-5) Notes, 11.3925%, subject to adjustment in accordance with Section 2.02. 

“Required Subordinated Percentage of Class D Notes” means, for the
Class A(2016-5) Notes, 3.7975%, subject to adjustment in accordance with Section 2.02. 

“Stated Principal Amount” means $625,000,000. 

Section 1.02. Governing Law. THIS TERMS DOCUMENT WILL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK, INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATION LAW, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS. 
 Section 1.03. Counterparts. This Terms Document may be executed in any number of
counterparts, each of which so executed will be deemed to be an original, but all such counterparts will together constitute but one and the same instrument. 

Section 1.04. Ratification of Indenture, Asset Pool 1 Supplement and Indenture Supplement. As supplemented by this Terms
Document, each of the Indenture, the Asset Pool 1 Supplement and the Indenture Supplement is in all respects ratified and confirmed and the Indenture as so supplemented by the Asset Pool 1 Supplement as so supplemented by the Indenture Supplement as
so supplemented and this Terms Document shall be read, taken and construed as one and the same instrument. 
 [END OF ARTICLE I] 

  
 7 

 ARTICLE II 

The Class A(2016-5) Notes 

Section 2.01. Creation and Designation. There is hereby created a tranche of Card Series Class A Notes to be issued
pursuant to the Indenture, the Asset Pool 1 Supplement and the Indenture Supplement to be known as the “Card Series Class A(2016-5) Notes.” 

Section 2.02. Adjustments to Required Subordinated Percentages. 

(a) On any date, the Issuer may change the Required Subordinated Percentage of Class B Notes or the Required Subordinated Percentage of Class C
Notes, in each case for the Class A(2016-5) Notes, without the consent of any Noteholders or any Note Rating Agencies, provided that, after giving effect to such change, (x) the sum of the Required
Subordinated Percentage of Class B Notes and the Required Subordinated Percentage of Class C Notes, in each case, for the Class A(2016-5) Notes after giving effect to such change is equal to or
greater than the sum of the Required Subordinated Percentage of Class B Notes and the Required Subordinated Percentage of Class C Notes, in each case, for the Class A(2016-5) Notes immediately prior to
giving effect to such change and (y) the Required Subordinated Amount of Class B Notes for the Class A(2016-5) Notes does not exceed the Maximum Subordinated Amount of Class B Notes. 

(b) On any date, the Issuer may change the Required Subordinated Percentage of Class B Notes, the Required Subordinated Percentage of Class C
Notes or the Required Subordinated Percentage of Class D Notes, in each case for the Class A(2016-5) Notes, such that after giving effect to all changes to such percentages on such date the sum of the
Required Subordinated Percentage of Class B Notes, the Required Subordinated Percentage of Class C Notes and the Required Subordinated Percentage of Class D Notes, in each case, for the Class A(2016-5)
Notes after giving effect to such change is less than the sum of the Required Subordinated Percentage of Class B Notes, the Required Subordinated Percentage of Class C Notes and the Required Subordinated Percentage of Class D Notes, in each case,
for the Class A(2016-5) Notes immediately prior to giving effect to such change, without the consent of any Noteholders, provided that the Issuer has (i) received written confirmation from each Note
Rating Agency that has rated any Outstanding Notes of the Card Series that the change in such percentage will not result in a Ratings Effect with respect to any Outstanding Notes and (ii) delivered to the Indenture Trustee and the Note Rating
Agencies a Master Trust Tax Opinion for each Master Trust and an Issuer Tax Opinion. 
 Section 2.03. Interest Payment.

 (a) For each Interest Payment Date, the amount of interest due with respect to the
Class A(2016-5) Notes shall be an amount equal to one-twelfth of the product of (i) the Note Interest Rate times (ii) the Outstanding Dollar Principal Amount of the Class A(2016-5) Notes determined as of the Record Date preceding the related Distribution Date; provided, however, that for the first Interest Payment Date the amount of interest due is
$1,440,972. Any interest on the Class A(2016-5) Notes will be calculated on the basis of a 360-day year consisting of twelve 30-day months. 

  
 8 

 (b) Pursuant to Section 3.03 of the Indenture Supplement, on each Distribution Date,
the Indenture Trustee shall deposit into the Class A(2016-5) Interest Funding sub-Account the portion of Card Series Finance Charge Amounts allocable to the Class A(2016-5) Notes. 
 Section 2.04. [Reserved]. 

Section 2.05. Payments of Interest and Principal. 

(a) Any installment of interest or principal, if any, payable on any Class A(2016-5) Note which is
punctually paid or duly provided for by the Issuer and the Indenture Trustee on the applicable Interest Payment Date or Principal Payment Date shall be paid by the Paying Agent to the Person in whose name such
Class A(2016-5) Note (or one or more Predecessor Notes) is registered on the Record Date, by wire transfer of immediately available funds to such Person’s account as has been designated by written
instructions received by the Paying Agent from such Person not later than the close of business on the third Business Day preceding the date of payment or, if no such account has been so designated, by check mailed
first-class, postage prepaid to such Person’s address as it appears on the Note Register on such Record Date, except that with respect to Notes registered on the Record Date in the name of the nominee of
Cede & Co., payment shall be made by wire transfer in immediately available funds to the account designated by such nominee. 
 (b)
The right of the Class A(2016-5) Noteholders to receive payments from the Issuer will terminate on the first Business Day following the Class A(2016-5)
Termination Date. 
 Section 2.06. Form of Delivery of Class A(2016-5) Notes;
Depository; Denominations. 
 (a) The Class A(2016-5) Notes shall be delivered in the form
of a global Registered Note as provided in Sections 202 and 301(i) of the Indenture, respectively. 
 (b) The Depository for
the Class A(2016-5) Notes shall be The Depository Trust Company, and the Class A(2016-5) Notes shall initially be registered in the name of Cede &
Co., its nominee. 
 (c) The Class A(2016-5) Notes will be issued in minimum denominations of
$1,000 and integral multiples of $1,000 in excess of that amount. 
 Section 2.07. Delivery and Payment for the Class A(2016-5) Notes. The Issuer shall execute and deliver the Class A(2016-5) Notes to the Indenture Trustee for authentication, and the Indenture Trustee
shall deliver the Class A(2016-5) Notes when authenticated, each in accordance with Section 303 of the Indenture. 

  
 9 

 Section 2.08. Targeted Deposits to the Accumulation Reserve Account. The
deposit targeted to be made to the Accumulation Reserve Account for any Monthly Period during the Accumulation Reserve Funding Period will be an amount equal to the Required Accumulation Reserve sub-Account
Amount. 
 [END OF ARTICLE II] 

  
 10 

 IN WITNESS WHEREOF, the parties hereto have caused this Terms Document to be duly executed, all
as of the day and year first above written. 
  

			
	 CAPITAL ONE MULTI-ASSET EXECUTION
TRUST,

		
	By:	 	DEUTSCHE BANK TRUST COMPANY DELAWARE, not in its individual capacity, but solely as Owner Trustee on behalf of the Trust
		
	By:	 	 /s/ Diana Vasconez

		 	Name: Diana Vasconez
		 	Title: Attorney-in-fact
		
	By:	 	 /s/ Maria Inoa

		 	Name: Maria Inoa
		 	Title: Attorney-in-fact
	
	 THE BANK OF NEW YORK MELLON, as Indenture Trustee and not in its individual
capacity

		
	By:	 	 /s/ Leslie Morales

		 	Name: Leslie Morales
		 	Title: Vice President

  
 [Class
A(2016-5) Terms Document]vktx-ex41_6.htm

 

Exhibit 4.1

REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of August 24, 2016, by and between VIKING THERAPEUTICS, INC., a Delaware corporation (the “Company”), and ASPIRE CAPITAL FUND, LLC, an Illinois limited liability company (together with its permitted assigns, the “Buyer”).  Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Common Stock Purchase Agreement by and between the parties hereto, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Purchase Agreement”).

 

WHEREAS:

 

A.Upon the terms and subject to the conditions of the Purchase Agreement, (i) the Company has agreed to issue to the Buyer, and the Buyer has agreed to purchase, up to Twelve Million Dollars ($12,000,000) of the Company’s common stock, par value $0.00001 per share (the “Common Stock”), pursuant to Section 1 of the Purchase Agreement (such shares, the “Purchase Shares”), and (ii) the Company has agreed to issue to the Buyer such number of shares of Common Stock as is required pursuant to Section 4(e) of the Purchase Agreement (the “Commitment Shares”); and

 

B.To induce the Buyer to enter into the Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “1933 Act”), and applicable state securities laws.

 

NOW, THEREFORE, in consideration of the promises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Buyer hereby agree as follows:

 

1.DEFINITIONS.

 

As used in this Agreement, the following terms shall have the following meanings:

 

a.“Person” means any person or entity including any corporation, a limited liability company, an association, a partnership, an organization, a business, an individual, a governmental or political subdivision thereof or a governmental agency.

 

b.“Register,” “registered,” and “registration” refer to a registration effected by preparing and filing one or more registration statements of the Company in compliance with the 1933 Act and pursuant to Rule 415 under the 1933 Act or any successor rule providing for offering securities on a continuous basis (“Rule 415”), and the declaration or ordering of effectiveness of such registration statement(s) by the U.S. Securities and Exchange Commission (the “SEC”).

 

c.“Registrable Securities” means (i) all of the Commitment Shares and Initial Purchase Shares and (ii) such number of additional Purchase Shares as reasonably determined by the Company, which may from time to time be, issued or issuable to the Buyer upon purchases of the Available Amount under the Purchase Agreement, and any shares of capital stock issued or issuable with respect to the Purchase Shares, the Commitment Shares or the Purchase Agreement as a result of any stock split, 

 

 

stock dividend, recapitalization, exchange or similar event, without regard to any limitation on purchases under the Purchase Agreement. 

 

d.“Registration Statement” means a registration statement of the Company covering only the sale of the Registrable Securities.

 

2.REGISTRATION.

 

a.Mandatory Registration.  The Company shall within twenty (20) Business Days from the date hereof file with the SEC the Registration Statement. The Registration Statement shall register only the Registrable Securities and no other securities of the Company.  The Buyer and its counsel shall have a reasonable opportunity to review and comment upon such Registration Statement or any amendment to such Registration Statement and any related prospectus prior to its filing with the SEC.  The Buyer shall furnish all information reasonably requested by the Company for inclusion therein.  The Company shall use its reasonable best efforts to have the Registration Statement or any amendment declared effective by the SEC as soon as reasonably practicable.  Subject to Permitted Delays (as defined below) and Section 3(e), the Company shall use reasonable best efforts to keep the Registration Statement effective pursuant to Rule 415 promulgated under the 1933 Act and available for sales of all of the Registrable Securities at all times until the earlier of (i) the date as of which the Buyer may sell all of the Registrable Securities without restriction pursuant to Rule 144 promulgated under the 1933 Act (or successor thereto) or (ii) the date on which the Buyer shall have sold all the Registrable Securities and no Available Amount remains under the Purchase Agreement (the “Registration Period”).  The Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) shall not contain any 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, in light of the circumstances under which they were made, not misleading.  

 

b.Rule 424 Prospectus.  The Company shall, as required by applicable securities regulations, from time to time file with the SEC, pursuant to Rule 424 promulgated under the 1933 Act, a prospectus and prospectus supplements, if any, to be used in connection with sales of the Registrable Securities under the Registration Statement.  The Buyer and its counsel shall have two (2) Business Days to review and comment upon such prospectus prior to its filing with the SEC.  The Buyer shall use its reasonable best efforts to comment upon such prospectus within two (2) Business Days from the date the Buyer receives the final version of such prospectus. 

 

c.Sufficient Number of Shares Registered.  In the event the number of shares available under the Registration Statement is insufficient to cover the Registrable Securities, the Company shall, to the extent necessary and permissible, amend the Registration Statement or file a new registration statement (a “New Registration Statement”), so as to cover all such Registrable Securities as soon as practicable, but in any event not later than twenty (20) Business Days after the necessity therefor arises.  The Company shall use its reasonable best efforts to have such amendment and/or New Registration Statement become effective as soon as reasonably practicable following the filing thereof.    

 

2

 

 

3.RELATED OBLIGATIONS. 

 

With respect to the Registration Statement and whenever any Registrable Securities are to be registered pursuant to Sections 2(a) and (c), including on any New Registration Statement, the Company shall use its reasonable best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall have the following obligations:

 

a.The Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to any Registration Statement and the prospectus used in connection with such Registration Statement, as may be necessary to keep the Registration Statement or any New Registration Statement effective at all times during the Registration Period, subject to Permitted Delays and Section 3(e) hereof and, during such period, comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities of the Company covered by the Registration Statement or any New Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement.  Should the Company file a post-effective amendment to the Registration Statement or a New Registration Statement, the Company will use its reasonable best efforts to have such filing declared effective by the SEC within thirty (30) consecutive Business Days as of the date of filing, which such period shall be extended for an additional thirty (30) Business Days if the Company receives a comment letter from the SEC in connection therewith. If (i) there is material non-public information regarding the Company which the Company’s Board of Directors reasonably determines not to be in the Company’s best interest to disclose and which the Company is not otherwise required to disclose or (ii) there is a significant business opportunity (including, but not limited to, the acquisition or disposition of assets (other than in the ordinary course of business) or any merger, consolidation, tender offer or other similar transaction) available to the Company which the Company’s Board of Directors reasonably determines not to be in the Company’s best interest to disclose and which the Company would be required to disclose under a Registration Statement or a New Registration Statement, then the Company may postpone or suspend filing or effectiveness of such Registration Statement or New Registration Statement or use of the prospectus under the Registration Statement or New Registration Statement for a period not to exceed thirty (30) consecutive days, provided that the Company may not postpone or suspend its obligation under this Section 3(a) for more than sixty (60) days in the aggregate during any twelve (12) month period (each, a “Permitted Delay”).

 

b.The Company shall submit to the Buyer for review and comment any disclosure in the Registration Statement, any New Registration Statement and all amendments and supplements thereto (other than prospectus supplements that consist only of a copy of a filed Form 10-K, Form 10‐Q or a Current Report on Form 8-K or any amendment as a result of the Company’s filing of a document that is incorporated by reference into the Registration Statement or New Registration Statement) containing information provided by the Buyer for inclusion in such document and any descriptions or disclosure regarding the Buyer, the Purchase Agreement, including the transaction contemplated thereby, or this Agreement at least two (2) Business Days prior to their filing with the SEC, and not file any document in a form to which Buyer reasonably and timely objects.  Upon request of the Buyer, the Company shall provide to the Buyer all disclosure in the Registration Statement or any New Registration Statement and all amendments and supplements thereto (other than prospectus supplements that consist only of a copy of a filed Form 10-K, Form 10‐Q or Current Report on Form 8-K or any amendment as a result of the Company’s filing of a document that is incorporated by reference into the Registration Statement or New Registration Statement) at least two (2) Business Days prior to their filing with the SEC, and not file any document in a form to which Buyer reasonably and timely objects.  The Buyer shall use its reasonable best 

3

 

 

efforts to comment upon the Registration Statement or any New Registration Statement and any amendments or supplements thereto within two (2) Business Days from the date the Buyer receives the final version thereof.  The Company shall furnish to the Buyer, without charge, any correspondence from the SEC or the staff of the SEC to the Company or its representatives relating to the Registration Statement or any New Registration Statement. 

 

c.Upon request of the Buyer, the Company shall furnish to the Buyer, (i) promptly after the same is prepared and filed with the SEC, at least one copy of the Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits, (ii) upon the effectiveness of a Registration Statement, a copy of the prospectus included in such Registration Statement and all amendments and supplements thereto (or such other number of copies as the Buyer may reasonably request) and (iii) such other documents, including copies of any preliminary or final prospectus, as the Buyer may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities owned by the Buyer.

 

d.The Company shall use reasonable best efforts to (i) register and qualify, unless an exemption from registration and qualification is available, the Registrable Securities covered by a Registration Statement under such other securities or “blue sky” laws of such jurisdictions in the United States as the Buyer reasonably requests, (ii) subject to Permitted Delays, prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(d), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction.  The Company shall promptly notify the Buyer who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities or “blue sky” laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.

 

e.Subject to Permitted Delays, as promptly as reasonably practicable after becoming aware of such event or facts, the Company shall notify the Buyer in writing if the Company has determined that the prospectus included in any Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and as promptly as reasonably practical (taking into account the Company’s good faith assessment of any adverse consequences to the Company and its stockholders of premature disclosure of such event or facts) prepare a prospectus supplement or amendment to such Registration Statement to correct such untrue statement or omission, and, upon the Buyer’s request, deliver a copy of such prospectus supplement or amendment to the Buyer.  In providing this notice to the Buyer, the Company shall not include any other information about the facts underlying the Company’s determination and shall not in any way communicate any material nonpublic information about the Company or the Common Stock to the Buyer.  The Company shall also promptly notify the Buyer in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to the Buyer by facsimile or e-mail on the same day of such effectiveness), (ii) of any request 

4

 

 

by the SEC for amendments or supplements to any Registration Statement or related prospectus or related information, and (iii) of the Company’s reasonable determination that a post-effective amendment to a Registration Statement would be appropriate.  In no event shall the delivery of a notice under this Section 3(e), or the resulting unavailability of a Registration Statement, without regard to its duration, for disposition of securities by Buyer be considered a breach by the Company of its obligations under this Agreement.  The preceding sentence in this Section 3(e) does not limit whether an event of default has occurred as set forth in Section 9(a) of the Purchase Agreement. 

 

f.The Company shall use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of any Registration Statement, or the suspension of the qualification of any Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest practical time and to notify the Buyer of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.

 

g.The Company shall (i) cause all the Registrable Securities to be listed on each securities exchange on which securities of the same class or series issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted under the rules of such exchange, or (ii) secure designation and quotation of all the Registrable Securities if the Principal Market (as such term is defined in the Purchase Agreement) is an automated quotation system.  The Company shall pay all fees and expenses in connection with satisfying its obligation under this Section.

 

h.The Company shall cooperate with the Buyer to facilitate the timely preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to any Registration Statement and enable such certificates to be in such denominations or amounts as the Buyer may reasonably request and registered in such names as the Buyer may request.

 

i.The Company shall at all times provide a transfer agent and registrar with respect to its Common Stock.

 

j.If reasonably requested by the Buyer, the Company shall (i) promptly incorporate in a prospectus supplement or post-effective amendment to the Registration Statement such information as the Buyer believes should be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the number of Registrable Securities being sold, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities; (ii) make all required filings of such prospectus supplement or post-effective amendment promptly after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement (including by means of any document incorporated therein by reference).

 

k.The Company shall use its reasonable best efforts to cause the Registrable Securities covered by any Registration Statement to be registered with or approved by such other governmental agencies or authorities in the United States as may be necessary to consummate the disposition of such Registrable Securities.

 

l.Within one (1) Business Day after any Registration Statement is ordered effective by the SEC, the Company shall deliver to the Transfer Agent for such Registrable Securities (with copies to the Buyer) confirmation that such Registration Statement has been declared effective by the SEC in the 

5

 

 

form attached hereto as Exhibit A.  Thereafter, if reasonably requested by the Buyer at any time, the Company shall deliver to the Buyer a written confirmation of whether or not the effectiveness of such Registration Statement has lapsed at any time for any reason (including, without limitation, the issuance of a stop order) and whether or not the Registration Statement is currently effective and available to the Buyer for sale of all of the Registrable Securities.   

 

m.The Company agrees to take all other reasonable actions as necessary and reasonably requested by the Buyer to expedite and facilitate disposition by the Buyer of Registrable Securities pursuant to any Registration Statement.

 

4.OBLIGATIONS OF THE BUYER.

 

a.The Buyer has furnished to the Company in Exhibit B hereto such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as required to effect the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request. The Company shall notify the Buyer in writing of any other information the Company reasonably requires from the Buyer in connection with any Registration Statement hereunder. The Buyer will as promptly as practicable notify the Company of any material change in the information set forth in Exhibit B, other than changes in its ownership of the Common Stock.

 

b.The Buyer agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of any amendments and supplements to any Registration Statement hereunder.

 

c.The Buyer agrees that, upon receipt of any notice from the Company of the happening of any event or existence of facts of the kind described in Section 3(f) or any notice of the kind described in the first sentence of Section 3(e), the Buyer will immediately discontinue disposition of Registrable Securities pursuant to any registration statement(s) covering such Registrable Securities until the Buyer’s receipt (which may be accomplished through electronic delivery) of the copies of the filed supplemented or amended prospectus contemplated by Section 3(f) or the first sentence of Section 3(e).  In addition, upon receipt of any notice from the Company of the kind described in the first sentence of Section 3(e), the Buyer will immediately discontinue purchases or sales of any securities of the Company unless such purchases or sales are in compliance with applicable U.S. securities laws..  Notwithstanding anything to the contrary, the Company shall cause its Transfer Agent to deliver as promptly as practicable shares of Common Stock without any restrictive legend in accordance with the terms of the Purchase Agreement in connection with any sale of Registrable Securities with respect to which the Buyer has received a Purchase Notice or VWAP Purchase Notice (both as defined in the Purchase Agreement) prior to the Buyer’s receipt of a notice from the Company of the happening of any event of the kind described in Section 3(f) or the first sentence of Section 3(e) and for which the Buyer has not yet settled.

 

5.EXPENSES OF REGISTRATION.

 

All reasonable expenses of the Company, other than sales or brokerage commissions and fees and disbursements of counsel for the Buyer, incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation, all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel for the Company, shall be paid by the Company.

 

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6.INDEMNIFICATION. 

 

a.To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend the Buyer, each Person, if any, who controls the Buyer, the members, the directors, officers, partners, employees, agents, representatives of the Buyer and each Person, if any, who controls the Buyer within the meaning of the 1933 Act or the Securities Exchange Act of 1934, as amended (the “1934 Act”) (each, an “Indemnified Person”), against any losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid in settlement (with the consent of the Company, such consent not to be unreasonably withheld) or expenses (collectively, “Claims”) reasonably incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency or body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement of a material fact in the Registration Statement, any New Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification of the offering under the securities or other “blue sky” laws of any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”), or the omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in the final prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances under which the statements therein were made, not misleading, or (iii) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant to the Registration Statement or any New Registration Statement (the matters in the foregoing clauses (i) through (iii) being, collectively, “Violations”).  The Company shall reimburse each Indemnified Person promptly as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim.  Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (A) shall not apply to a Claim by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information furnished in writing to the Company by the Buyer or such Indemnified Person expressly for use in connection with the preparation of the Registration Statement, any New Registration Statement or any such amendment thereof or supplement thereto, if such prospectus was timely made available by the Company; (B) with respect to any superseded prospectus, shall not inure to the benefit of any such person from whom the person asserting any such Claim purchased the Registrable Securities that are the subject thereof (or to the benefit of any other Indemnified Person) if the untrue statement or omission of material fact contained in the superseded prospectus was corrected in the revised prospectus, as then amended or supplemented, if such revised prospectus was timely made available by the Company pursuant to Section 3(c) or Section 3(e), and the Buyer was promptly advised in writing not to use the incorrect prospectus prior to the use giving rise to a violation; (C) shall not be available to the extent such Claim is based on a failure of the Buyer to deliver, or to cause to be delivered, the prospectus made available by the Company, if such prospectus was theretofore made available by the Company pursuant to Section 3(c) or Section 3(e); and (D) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld.  Such indemnity shall remain 

7

 

 

in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by the Buyer pursuant to Section 9. 

 

b.In connection with the Registration Statement or any New Registration Statement, the Buyer agrees to indemnify, hold harmless and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors, each of its officers who signs the Registration Statement or any New Registration Statement, each Person, if any, who controls the Company within the meaning of the 1933 Act or the 1934 Act (collectively and together with an Indemnified Person, an “Indemnified Party”), against any Claim or Indemnified Damages to which any of them may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based upon any Violation, in each case to the extent, and only to the extent, that such Violation occurs in reliance upon and in conformity with written information about the Buyer set forth on Exhibit B attached hereto or updated from time to time in writing by the Buyer and furnished to the Company by the Buyer expressly for  use in the Registration Statement or any New Registration Statement or from the failure of the Buyer to deliver or to cause to be delivered the prospectus made available by the Company, if such prospectus was timely made available by the Company pursuant to Section 3(c) or Section 3(e); and, subject to Section 6(d), the Buyer will reimburse any legal or other expenses reasonably incurred by them in connection with investigating or defending any such Claim; provided, however, that the indemnity agreement contained in this Section 6(b) and the agreement with respect to contribution contained in Section 7 shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Buyer, which consent shall not be unreasonably withheld; provided, further, however, that the Buyer shall be liable under this Section 6(b) for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to the Buyer as a result of the sale of Registrable Securities pursuant to such registration statement.  Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the transfer of the Registrable Securities by the Buyer pursuant to Section 9. 

 

c.Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be, and upon such notice, the indemnifying party shall not be liable to the Indemnified Person or Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Person or Indemnified Party in connection with the defense thereof; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. The Indemnified Party or Indemnified Person shall cooperate with the indemnifying party in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party or Indemnified Person which relates to such action or claim.  The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised as to the status of the defense or any settlement negotiations with 

8

 

 

respect thereto.  No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected without its written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent.  No indemnifying party shall, without the consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such claim or litigation.  Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made.  The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is prejudiced in its ability to defend such action. 

 

d.The indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or Indemnified Damages are incurred.  Any person receiving a payment pursuant to this Section 6 which person is later determined to not be entitled to such payment shall return such payment to the person making it.

 

e.The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.

 

7.CONTRIBUTION.

 

To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that: (i) no seller of Registrable Securities guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any seller of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds received by such seller from the sale of such Registrable Securities.

 

8.REPORTS AND DISCLOSURE UNDER THE SECURITIES ACTS.

 

With a view to making available to the Buyer the benefits of Rule 144 promulgated under the 1933 Act or any other similar rule or regulation of the SEC that may at any time permit the Buyer to sell securities of the Company to the public without registration (“Rule 144”), the Company agrees, at the Company’s sole expense, to:

 

a.use its reasonable best efforts to make and keep public information available, as those terms are understood and defined in Rule 144;

 

b.use its reasonable best efforts to file with the SEC in a timely manner all reports and other documents required of the Company under the 1933 Act and the 1934 Act so long as the Company remains subject to such requirements and the filing of such reports and other documents is required to satisfy the current public information requirements of Rule 144; 

9

 

 

 

c.furnish to the Buyer so long as the Buyer owns Registrable Securities, as promptly as practicable at Buyer’s request, (i) a written statement by the Company that it has complied in all material respects with the requirements of Rule 144(c)(1)(i) and (ii), and (ii) such other information, if any, as may be reasonably requested to permit the Buyer to sell such securities pursuant to Rule 144 without registration; and

 

d.take such additional action as is reasonably requested by the Buyer to enable the Buyer to sell the Registrable Securities pursuant to Rule 144, including, without limitation, delivering all such legal opinions, consents, certificates, resolutions and instructions to the Company’s Transfer Agent as may be reasonably requested from time to time by the Buyer and otherwise provide reasonable cooperation to the Buyer and the Buyer’s broker to effect such sale of securities pursuant to Rule 144.

 

The Company agrees that damages may be an inadequate remedy for any breach of the terms and provisions of this Section 8 and that Buyer shall, whether or not it is pursuing any remedies at law, be entitled to seek equitable relief in the form of a preliminary or permanent injunctions, without having to post any bond or other security, upon any breach or threatened breach of any such terms or provisions.

 

	
 
	
9.
	
ASSIGNMENT OF REGISTRATION RIGHTS.

 

The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Buyer.  The Buyer may not assign its rights under this Agreement without the prior written consent of the Company. 

 

10.AMENDMENT OF REGISTRATION RIGHTS.

 

Provisions of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the Buyer.

 

11.MISCELLANEOUS.

 

a.Any notices, consents or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii) upon receipt, when sent by electronic message (provided the recipient responds to the message and confirmation of both electronic messages are kept on file by the sending party); or (iv) one (1) Business Day after timely deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be:

 

If to the Company:

 

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Viking Therapeutics, Inc. 

12340 El Camino Real, Suite 250

San Diego, CA 92130

Telephone:858-704-4660

Attention:  Brian Lian, Ph.D., Chief Executive Officer

Email:blian@vikingtherapeutics.com

 

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

 

Paul Hastings LLP

1117 S. California Avenue

Palo Alto, CA 94304

Telephone:650-320-1804

Facsimile:650-320-1904

Attention:  Jeffrey T. Hartlin, Esq.

Email:jeffhartlin@paulhastings.com

 

If to the Buyer:

 

Aspire Capital Fund, LLC

155 North Wacker Drive, Suite 1600

Chicago, IL 60606 

Telephone:312-658-0400

Facsimile:312-658-4005

Attention:Steven G. Martin

Email:smartin@aspirecapital.com

 

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

Morrison & Foerster LLP

2000 Pennsylvania Avenue, NW, Suite 6000

Washington, DC 20006

Telephone:202-778-1611

Facsimile:202-887-0763

Attention:Martin P. Dunn, Esq.

Email:mdunn@mofo.com

 

or at such other address and/or facsimile number and/or to the attention of such other person as the recipient party has specified by written notice given to each other party one (1) Business Day prior to the effectiveness of such change.  Written confirmation of receipt (A) given by the recipient of such notice, consent or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date, and recipient facsimile number, (C) electronically generated by the sender’s electronic mail containing the time, date and recipient email address or (D) provided by a nationally recognized overnight delivery service, shall be rebuttable evidence of receipt in accordance with clause (i), (ii), (iii) or (iv) above, respectively.  Any party to this Agreement may give any notice or other communication hereunder using any other means (including messenger service, ordinary mail or electronic mail), but no such notice or other communication shall be deemed to have been duly given unless it actually is received by the party for whom it is intended.

 

11

 

 

b.No failure or delay in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. 

 

c.The corporate laws of the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders.  All other questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of Illinois, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Illinois or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of Illinois.  Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of Chicago for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, 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 to such party at the address for such 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.  If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

d.This Agreement, the Purchase Agreement and the other Transaction Documents constitute the entire understanding among the parties hereto with respect to the subject matter hereof and thereof.  There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein and therein.  This Agreement, the Purchase Agreement and the other Transaction Documents supersede all other prior oral or written agreements between the Buyer, the Company, their affiliates and persons acting on their behalf with respect to the subject matter hereof and thereof.

 

e.Subject to the requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the permitted successors and assigns of each of the parties hereto.

 

f.The headings in this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.

 

g.This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile or pdf (or other electronic reproduction of a) signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile or pdf (or other electronic reproduction of a) signature.

 

h.Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments 

12

 

 

and documents as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 

 

i.The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will be applied against any party.

 

j.This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

 

* * * * *

 

13

 

 

IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be duly executed as of day and year first above written.

 

 

 

		
	
 
	
THE COMPANY:

	
 
	
 

	
 
	
VIKING THERAPEUTICS, INC.

	
 
	
 

	
 
	
By: /s/ Brian Lian, Ph.D.

	
 
	
Name: Brian Lian, Ph.D.

	
 
	
Title: President and Chief Executive Officer

 

 

 

 

			
	
 
	
BUYER:

	
 
	
 

	
 
	
ASPIRE CAPITAL FUND, LLC

	
 
	
BY: ASPIRE CAPITAL PARTNERS, LLC

	
 
	
BY:  SGM HOLDINGS CORP.

	
 
	
 
	
 

	
 
	
By: /s/ Steven G. Martin

	
 
	
Name: Steven G. Martin

	
 
	
Title: President

 

 

 

 

 

EXHIBIT A

 

FORM OF NOTICE OF EFFECTIVENESS OF REGISTRATION STATEMENT

 

[Date]

 

American Stock Transfer & Trust Company, LLC

6201 15th Ave.

Brooklyn, NY 11219

Attention:  Bill Torre, Senior Relationship Manager

 

RE:  VIKING THERAPEUTICS, INC.

 

Ladies and Gentlemen:

 

We refer to that certain Common Stock Purchase Agreement, dated as of August 24, 2016 (the “Purchase Agreement”), entered into by and between VIKING THERAPEUTICS, INC., a Delaware corporation (the “Company”) and ASPIRE CAPITAL FUND, LLC (the “Buyer”) pursuant to which the Company has agreed to issue to the Buyer shares of the Company’s Common Stock, par value $0.00001 per share (the “Common Stock”), in an amount up to Twelve Million Five Hundred Thousand Dollars ($12,500,000), in accordance with the terms of the Purchase Agreement. In connection with the transactions contemplated by the Purchase Agreement, the Company has registered with the U.S. Securities and Exchange Commission (the “SEC”) the sale by the Buyer of the following shares of Common Stock:

 

	
 
	
(1)
	
up to 3,184,209 shares of Common Stock to be issued upon purchase from the Company by the Buyer from time to time (the “Purchase Shares”); 

 

	
 
	
(2)
	
333,333 shares of Common Stock which have been sold to the Buyer in exchange for payment therefor (the “Initial Purchase Shares”); and 

 

	
 
	
(3)
	
336,116 shares of Common Stock which have been issued to the Buyer as a commitment fee (the “Commitment Shares”). 

 

In connection with the transactions contemplated by the Purchase Agreement, on [·], 2016, the Company filed a registration statement on Form S-1 (File No. 333-[·])[, as amended] (the “Registration Statement”)[,] with the SEC relating to the sale by the Buyer of the Purchase Shares, the Initial Purchase Shares and the Commitment Shares.  

 

As counsel to the Company in connection with the preparation of the Registration Statement and for purposes of the statements in the penultimate paragraph of this letter, we have examined and relied upon originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate and other records of the Company, certificates of officers of the Company and such other documents and instruments as we have deemed necessary or appropriate as a basis for the statements set forth herein.

 

In addition to the foregoing, we have made such investigations of law as we have deemed necessary or appropriate as a basis for the statements in the penultimate paragraph of this letter. In such 

 

 

examination and in rendering the statements in the penultimate paragraph of this letter, we have assumed: (i) the genuineness of all signatures on all documents submitted to us; (ii) the authenticity and completeness of all documents, corporate records, certificates and other instruments submitted to us; (iii) that photocopy, electronic, certified, conformed, facsimile and other copies submitted to us of original documents, corporate records, certificates and other instruments conform to the original documents, corporate records, certificates and other instruments, and that all such original documents, corporate records, certificates and other instruments were authentic and complete; (iv) the legal capacity and authority of all individuals executing documents; and (v) that the statements contained in the certificates and comparable documents of public officials, officers and representatives of the Company and other persons on which we have relied for the purposes of this letter are true and correct. As to all questions of fact material to this letter and as to the materiality of any fact or other matter referred to herein, we have relied (without independent investigation) upon certificates or comparable documents of officers and representatives of the Company. We have further assumed that any resales of the Purchase Shares, the Initial Purchase Shares and the Commitment Shares by the Buyer will be in one or more transactions of the type described in the “Plan of Distribution” section of the Registration Statement.

 

Based on the foregoing and in reliance thereon, we advise you that (i) based solely on our review of the Notice of Effectiveness posted by the SEC on EDGAR, the Registration Statement became effective under the Securities Act of 1933, as amended (the “1933 Act”), at [·] [A./P.]M. on [·], 201[·], (ii) to our knowledge, based solely on a review of the SEC’s website at http://www.sec.gov/litigation/stoporders.shtml as of [·], 2016, no stop order suspending the effectiveness of the Registration Statement has been issued under the 1933 Act, and, to our knowledge, no proceedings for that purpose have been instituted or are pending or threatened by the SEC, and (iii) the Purchase Shares, the Initial Purchase Shares and the Commitment Shares may be issued without a restrictive legend referencing the 1933 Act provided that at the time of such issuance, the Company has not otherwise notified you that the Registration Statement is unavailable for the sale of the Purchase Shares, the Initial Purchase Shares or the Commitment Shares. 

 

This letter is based upon and limited to the 1933 Act as it exists on the date hereof, and we assume no obligation to advise you or any other person hereafter with regard to any change after the date hereof in the circumstances or the law that may bear on the matters set forth herein even though the change may affect the legal analysis or a legal conclusion or other matters in this letter. This letter deals only with the specified legal issues expressly addressed herein, and you should not infer any opinion or statement that is not explicitly addressed herein from any matter stated in this letter. This letter may be relied upon only by you and any broker or dealer acting on behalf of the Company or the Buyer. 

 

		
	
 
	
Very truly yours,

	
 
	
 

	
 
	
 

	
 
	
Paul Hastings LLP

 

 

CC:Aspire Capital Fund, LLC

 

 

EXHIBIT B

 

Information About The Buyer Furnished To The Company By The Buyer

Expressly For Use In Connection With The Registration Statement and Prospectus

 

Aspire Capital Partners LLC (“Aspire Partners”) is the Managing Member of Aspire Capital Fund LLC (“Aspire Fund”).  SGM Holdings Corp (“SGM”) is the Managing Member of Aspire Partners.  Mr. Steven G. Martin (“Mr. Martin”) is the president and sole shareholder of SGM, as well as a principal of Aspire Partners.  Mr. Erik J. Brown (“Mr. Brown”) is the president and sole shareholder of Red Cedar Capital Corp (“Red Cedar”), which is a principal of Aspire Partners.  Mr. Christos Komissopoulos (“Mr. Komissopoulos”) is president and sole shareholder of Chrisko Investors Inc (“Chrisko”), which is a principal of Aspire Partners.  Each of Aspire Partners, SGM, Red Cedar, Chrisko, Mr. Martin, Mr. Brown, and Mr. Komissopoulos may be deemed to be a beneficial owner of common stock held by Aspire Fund. Each of Aspire Partners, SGM, Red Cedar, Chrisko, Mr. Martin, Mr. Brown, and Mr. Komissopoulos disclaims beneficial ownership of the common stock held by Aspire Fund.

 

Plan of Distribution

 

The common stock may be sold or distributed from time to time by the selling stockholder directly to one or more purchasers or through brokers, dealers, or underwriters who may act solely as agents at market prices prevailing at the time of sale, at prices related to the prevailing market prices, at negotiated prices, or at fixed prices, which may be changed. The sale of the common stock offered by this prospectus may be effected in one or more of the following methods:

	
 
	
·
	
ordinary brokers’ transactions;

	
 
	
·
	
transactions involving cross or block trades;

	
 
	
·
	
through brokers, dealers, or underwriters who may act solely as agents;

	
 
	
·
	
“at the market” into an existing market for the common stock;

	
 
	
·
	
in other ways not involving market makers or established business markets, including direct sales to purchasers or sales effected through agents;

	
 
	
·
	
in privately negotiated transactions; or

	
 
	
·
	
any combination of the foregoing.

 

In order to comply with the securities laws of certain states, if applicable, the shares may be sold only through registered or licensed brokers or dealers.  In addition, in certain states, the shares may not be sold unless they have been registered or qualified for sale in the state or an exemption from the registration or qualification requirement is available and complied with.

 

The selling stockholder may also sell shares of common stock under Rule 144 promulgated under the Securities Act, if available, rather than under this prospectus. In addition, the selling stockholder may transfer the shares of common stock by other means not described in this prospectus.

 

Brokers, dealers, underwriters, or agents participating in the distribution of the shares as agents may receive compensation in the form of commissions, discounts, or concessions from the selling stockholder and/or purchasers of the common stock for whom the broker-dealers may act as agent.  

 

 

Aspire Capital has informed us that each such broker-dealer will receive commissions from Aspire Capital which will not exceed customary brokerage commissions. 

 

The selling stockholder and its affiliates have agreed not to engage in any direct or indirect short selling or hedging of our common stock during the term of the Purchase Agreement.

 

The selling stockholder is an “underwriter” within the meaning of the Securities Act. 

 

We have advised the selling stockholder that while it is engaged in a distribution of the shares included in this prospectus, it is required to comply with Regulation M promulgated under the Securities Exchange Act of 1934, as amended. With certain exceptions, Regulation M precludes the selling stockholder, any affiliated purchasers, and any broker-dealer or other person who participates in the distribution from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire distribution is complete. Regulation M also prohibits any bids or purchases made in order to stabilize the price of a security in connection with the distribution of that security. All of the foregoing may affect the marketability of the shares offered hereby this prospectus. 

 

We may suspend the sale of shares by the selling stockholder pursuant to this prospectus for certain periods of time for certain reasons, including if the prospectus is required to be supplemented or amended to include additional material information. 

 

This offering as it relates to Aspire Capital will terminate on the date that all shares offered by this prospectus have been sold by Aspire Capital.

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