Document:

ex104.htm

Exhibit 10.4

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement"), dated July 20, 2 0 1 1, is by and between Bill Hodson ("Employee") and SF BLU VU, INC. ("Employer").

 

RECITALS:

 

WHEREAS, Employer's board of directors (the "Board") desires to employ Employee in an executive capacity and the Employee desires to be so employed in such capacity;

 

WHEREAS, Employer may file for a company name change after the date this agreement was executed, the term “Employer” applies to the then current company name;

 

NOW THEREFORE, in consideration of the mutual covenants and conditions hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 

ARTICLE I

 

Term

 

1.1 Employment. Employer employs Employee and Employee accepts employment under the terms and conditions of this Agreement.

 

1.2 Term. This agreement is effective as of the date of this agreement. The term for employment under this Agreement shall be for five (5) years and shall be effective simultaneously with the CLOSING DATE defined in the PURCHASE AGREEMENT between SF BLU VU, INC., LIVEWIRE MC2, LLC, and the SELLING MEMBERS of LIVEWIRE MC2, LLC, and shall terminate after 60 months, unless extended by mutual agreement of the parties. Upon mutual agreement of the parties, this Agreement may be extended for an additional period upon written notice given to Employee not less than three (3) months prior to the termination of this Agreement.

 

A. Option Term. Upon mutual agreement of the parties, and upon the condition that there is no breach of any condition or term of this Agreement at the time of exercise, this Agreement may be extended for an additional twelve (12) months on the same terms and conditions of this Agreement, unless modified or amended upon the written consent of Employer and Employee.

 

 

  

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ARTICLE II

 

Compensation

 

2.1 Compensation. For all services rendered by Employee, Employer shall pay Employee the base salary commencing on the effective employment date of this agreement, of $260,000 per year. Salary payments shall be subject to the deferred salary terms of this agreement as well as withholding and other applicable taxes.

 

A. Salary Adjustment. Employer and Employee recognize that certain

" Events" (as defined in the following paragraphs) may occur which will give rise to a salary increase. Upon the occurrence of any one of the Events listed in the following paragraphs, Employee's salary shall be increased to twice (2 times) the current base salary per year during the term of this Agreement, and will become the new base salary. Such increase shall be automatic upon the happening of any one of the Events listed below.

 

B. Definition of "Events." For purposes of this Agreement and particularly, the salary increases described in the foregoing paragraph, any one of the following shall be considered an "Event":

 

i.             Merger. A merger with a third party entity, whereby at least fifty-­‐one percent (51%) of Employer's outstanding common stock is merged with such entity.

 

ii.            Sale/Acquisition. A sale or acquisition of at least fifty-­‐one percent of Employer's outstanding common stock or the sale of all or substantially all of Employer's assets to a third party entity.

 

iii.           Capital. Employer's raising at least $4 million through the sale of equity securities.

 

iv.           Debt Facility. A debt facility is put in place offering Employer a debt facility of at least $6 million.

 

C. Employee Exit Option. Upon any Event involving items i or ii above, Employee shall have the option to continue employment as described in the foregoing paragraphs or terminate employment and receive a one time payment of four (4) times the employee’s current base salary.

 

D. Other Salary Adjustment. Upon employer reaching a 12 month trailing revenue of $4 million, Employee's base salary shall automatically increase to $400,000 if current base salary is less.

 

 

  

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2.2 Earned Monetary Bonuses. Employee shall be entitled to an annual bonus as determined by the Employer's Board of Directors. Employee's performance shall be reviewed annually to determine the payment of bonuses.

 

2.3 Automobile Allowance. Employee shall be entitled to an automobile allowance of $500 per month, payable in equal payments. Employer shall pay Employee's automobile insurance and reasonable maintenance. 100% of the Automobile Allowance shall be deferred for 12 months and subject to section 2.8 “Deferred Compensation Payment” of this agreement.

 

2.4 Stock Option Consideration. Employee, as partial consideration for his services, shall be entitled to receive Stock Options as determined by the Employer's Board of Directors. Such determination shall be made on an annual basis.

 

2.5 Employee Benefits. In addition to the foregoing, Employee shall be entitled to the following:

 

A.     Health Insurance. Upon implementation of an Employee Health Insurance plan by Employer, Employer shall provide and pay for health, dental and life insurance for Employee and his family with an insurance carrier of Employer's choice. The benefits offered under this paragraph shall include a standard executive employee health and life insurance program.

 

B.     Expenses. Employee may incur reasonable expenses for promoting Employer's business, including expenses for entertainment, travel and similar items. Employer will reimburse Employee for all such reasonable expenses upon Employee's presentation of an itemized account of such expenditures. Employer shall provide Employee with a Diner's Club, American Express or other credit card for his use in promoting and representing Employer, dependent upon Employee's credit worthiness.

 

C.     Vacations. During the Term, Employee shall be entitled to paid vacation time of five (5) weeks per year of the Term, with any partial year determined on a pro rata basis. Vacation time shall be accrued and used in accordance with the Employer’s policy as it may be established from time to time. In addition, Employee shall receive other paid time-­‐off in accordance with the Employer's policies for senior executives; as such policies may exist from time to time.

 

2.6 Base Salary Review. The Board of Directors of Employer shall review the Base Salary annually and may make adjustments to increase but not decrease such Base Salary, in accordance with the compensation practices and guidelines of the Employer. The Base Salary shall not be reduced during the Term without Employee’s express prior written consent.

 

 

  

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2.7 Deferred Compensation. Unless the Board of Directors chooses to increase sooner, employee will initially be paid a reduced amount equal to $5000 per month, with the balance of the base salary deferred per the following:

 

A.   After 6 months or when employer's 12 month trailing revenue reaches $1 million, monthly paid amount will be increased to $10,000 with the remaining balance continuing to be deferred.

 

B.    After 12 months or when employer's 12 month trailing revenue reaches $2 million, monthly paid amount will be increased to the employee’s full salary.

 

2.8 Deferred Compensation Payment. Total Deferred compensation amount shall be paid at earliest possible opportunity or upon the occurrence of any Event from 2.1 “Compensation” and including any of the following:

 

A. The sale of substantially all of the Employer's assets to a single purchaser or group of associated purchasers; or

B. The sale, exchange, or other disposition, in one transaction of the majority of the Employer's outstanding corporate shares; or

C. Any other change of control of the Employer; or

D. The Employer's decision to terminate its business and liquidate its assets; or

E. The merger or consolidation of the Employer with another company; or

F. Bankruptcy or chapter 11 reorganization; or

G. Once 12 mo revenue run rate reaches $5 mil.; or

H. Upon payment terms agreeable to employee; or

I. Termination of employment; or

J. Attempted or successful demotion of employee in any way

 

Employee shall have two payment options for payment of the deferred compensation amount with the total amount paid equaling either the total deferred salary due plus an annual interest rate of prime + 8%, OR 5 shares for every dollar owed.

 

2.9 Equity. It is acknowledged that Employee has received restricted stock and stock options (collectively, "Equity") with specific terms and conditions provided in the relevant documentation. Employer agrees that there will be no change made to adversely affect such Equity in any such documentation during the Term, without the prior written consent of Employee.

 

  

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ARTICLE III

 

Duties of Employee

 

3.1 Duties. Employee is engaged as Chief Executive Officer; and as a member of the Board of Directors; and shall have authority over such decision-­‐making and managerial duties regarding the business of Employer; and shall supervise and direct all of the business of Employer according to business plans and strategies provided by Employer, reporting only to the Board. The precise services of Employee may be extended or curtailed by mutual agreement of Employer and Employee from time to time.

 

3.2 Extent of Services. Employee shall use Employee's good faith best efforts and judgment in performing Employee's duties required hereunder. Employee shall devote such time, attention and energies to the business of the Employer as are reasonably necessary to satisfy Employee's required responsibilities and duties hereunder.

 

3.4 Appointment to Board of Directors. Upon the effective employment date of this agreement, employee shall be immediately appointed to the Board of Directors of the employer.

 

3.5 Accountability. Employee shall be directly responsible to the Board.

 

ARTICLE IV

 

Duties of Employer

 

4.1 Payment of Compensation and Provision of Benefits. During the terms hereof, Employer agrees to pay all compensation, benefits, allowances, deferred compensation and Flexible Time Off due to Employee as set forth herein.

 

4.2 Working Facilities. Employer shall provide offices, and such other facilities and services as are suitable to his position and appropriate for the performance of his duties.

 

ARTICLE V

 

Disability; Death During Employment

 

5.1 Disability. If Employee is unable to perform his services by reason of illness or incapacity for a period of more than one (1) month, the compensation thereafter payable to him during the continued period of such illness or incapacity for a period not to exceed twelve (12) months, shall be seventy percent (70%) of Employee's then current salary. Employee's full compensation shall be reinstated upon his recovery. Notwithstanding anything to the contrary, Employer may terminate this Agreement at any time after Employee shall be absent from his employment, for whatever cause, for a continuous period of more than twelve months (12), and the obligations of Employer shall thereupon terminate, except as obligated under continued benefits provided herein. If it is determined, pursuant to the terms of this Agreement, that Employee is disabled or incapacitated and cannot discharge the duties and responsibilities contemplated hereunder, Employer shall have the right to hire an employee to replace him in whatever position he may have at that time.

 

 

  

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A. Disability Insurance. In lieu of the foregoing, Employer may obtain disability insurance for Employee. Should this occur, paragraph 5.1 shall be null and void and the terms of said disability insurance shall govern, so long as the terms in such policy are equal to or greater than the terms outlined in Section 5.1.

 

5.2 Death During Employment. If Employee dies during the term of employment, Employer shall pay to the estate of Employee the compensation which would otherwise be payable to Employee up to the end of the month in which death occurs. In addition, Employer shall pay a sum equal to two (2) year's compensation payable in three equal monthly installments after the death of Employee to the spouse of Employee or if he is not survived by his spouse, then to Employee's heirs in equal shares, or if there are no such surviving heirs, to the estate of Employee.

 

ARTICLE VI

 

Confidential Information; Trade Secrets; Proprietary Rights

 

6.1 Confidentiality. Employee hereby acknowledges that he has received information regarding the business of Employer, including but not limited to customer lists, product information, business strategy, employee agreements, which information is confidential information (the "Confidential Information"). The parties hereto recognize and acknowledge that the Confidential Information is proprietary and integral to Employer's business and agrees to keep such Confidential Information confidential and not disclose the same to any third person, corporation and/or entity for a period of two (2) years subsequent to the termination of this Agreement or termination of Employee with cause.

 

ARTICLE VII

 

Non-­‐Competition

 

7.1 Non-­‐Competition. During Employee's term of employment set forth in this Agreement, Employee will not directly or indirectly be an owner, partner, director, manager, officer or employee or otherwise render services to any business that competes with Employer.

 

  

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ARTICLE VIII

Termination

 

8.1 Termination With Cause. With cause, Employer may terminate this Agreement upon an affirmative vote of a majority of the members of the Board, and upon thirty (30) days' written notice to Employee by providing Employee a Notice of Termination, which shall set forth in reasonable detail the Employer's basis for such termination. In such event, Employee shall continue to render his services and shall be paid his regular compensation up to the date of termination. Employee shall be entitled to receive payment for any unreimbursed expenses incurred, accrued but unpaid Base Salary and other accrued but unpaid employee benefits as provided in this Agreement. Severance allowance shall be equal to six (6) month's salary of Employee. For purposes of this Agreement, "with cause" shall be defined as:

 

(i) Employee's conviction of a felony or of any crime involving moral turpitude, and affirmance of such conviction following the exhaustion of any appeals; (ii) willful refusal of Employee to substantially perform all of his duties and responsibilities, or Employee's persistent willful neglect of duty or chronic, willful unapproved absenteeism other than for a temporary or permanent Disability, which remains uncured following thirty days after written notice of such alleged Cause by the Board of Directors; or (iii) any material and substantial breach by Employee of other terms and conditions of this Agreement, which, in the reasonable, good faith judgment of the Board of Directors, has a material adverse financial effect on the Company or on Employee's ongoing abilities to carry out his duties under this Agreement and which remains uncured following thirty days after written notice of such alleged Cause by the Board of Directors.

 

8 . 2 Termination Without Cause. Employer may terminate Employee without cause upon thirty (30) days written notice. Upon termination without cause by employer, Employee shall be entitled to cash compensation equal to the greater of the following: (A) the then existing base salary of Employee, as defined in Article 2.1, for the remainder of the term of this Agreement; or (B) four (4) times the then existing base salary of Employee, as defined in Article 2.1, for a period of one (1) year from the date of termination without cause. In the event of termination without cause, all cash compensation and deferred amounts due, as referred to above, shall be paid to Employee on a bi-­‐monthly basis.

 

8.3 Termination Upon Sale of Business. Notwithstanding anything to the contrary, Employer may terminate this Agreement upon thirty (30) days' written notice upon the happening of any of the following events which any one event will be treated as a termination without cause for purposes of severance allowance pursuant to this Agreement.

 

A.   The sale by Employer of substantially all of its assets to a single purchaser or a group of associated purchasers;

 

B.    The sale, exchange or other disposition, in one transaction, of at least fifty percent (50%) of the outstanding common shares of the Employer;

 

C.    A decision by Employer to terminate its business and liquidate its assets; or the merger or consolidation of Employer in a transaction in which the shareholders of Employer receive at least fifty percent (50%) of the outstanding voting shares of the new or continuing corporation.

 

D.    Notwithstanding the foregoing, should Employer agree to sell all or substantially all of its assets, Employer shall purchase Employee's Shares for an amount of the greater of the Stock Purchase Price or the same price sold by other of Employer's shareholders.

 

8.4 Surviving Benefits. Employee will continue to receive the highest level of benefits received for a period of 5 years after termination.

 

 

  

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ARTICLE IX

 

General Provisions

 

9.1. Waiver of Breach. The waiver by Employer of breach of any provisions of this Agreement by Employee shall not operate or be construed as a waiver of any subsequent breach by Employee. No waiver shall be valid unless in writing and signed by an authorized officer of Employer.

 

9.2 Assignment. Employee acknowledges that the services to be rendered by him are unique and personal. Accordingly, Employee may not assign any of his rights under this Agreement. The rights and obligations of Employer under this Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of Employer.

 

9.3 Modification. This Agreement may not be modified, changed or altered orally but only by an agreement in writing signed by the party against an enforcement of any waiver, change, modification, extension or discharge as sought.

 

9.4. Governing Law. This Agreement shall be governed by and construed under the laws of the State of California.

 

9.5 Integration Clause. This instrument contains the entire agreement between the parties hereto and supersedes any and all prior written and/or oral agreements. This Agreement may be altered or modified only in writing signed by the parties hereto.

 

9.6 Notices. Any notice required or desired to be given under this Agreement shall be deemed given if in writing sent by certified mail to the parties at each party's last known address.

 

9.7 Attorneys' Fees. Should any party seek the enforcement of any term of this Agreement, the prevailing party thereunder shall be entitled to attorneys' fees and costs for the enforcement of such term or provision.

 

9.8 Arbitration. In the event of any dispute arising under this Agreement, including any dispute regarding the nature, scope or quality of services provided by either party hereto, its is hereby agreed that such dispute shall be resolved by binding arbitration to be conducted by the American Arbitration, to be arbitrated in accordance with its rules and regulations and procedures in Orange County, California. In the event of any such arbitration, pending resolution of the arbitration and the award of costs by the arbitrator, each party hereto shall advance one-­‐half of the amounts, if any, requested by the arbitrator and/or the sponsoring organization.

 

 

  

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IN WITNESS WHEREOF, the parties executed this Agreement as of the date first written above.

 

 

	EMPLOYEE	 	 	 
	 	 	 	 
	 	 	 	 
	 
Bill Hodson 

	 	 	 
	 	 	 	 

 

	EMPLOYER	 	 
	 	 	 	 
	By: 	 	 	 
	Richard O. Weed, CEO, CFO	 	 
	 	 	 	 
	SF BLU VU, INC.	 	 

 

 

 

9peregrine_8k-ex1030.htm

EXHIBIT 10.30

   

    

September 2, 2011

 

 

PEREGRINE PHARMACEUTICALS, INC.

SUBSCRIPTION AGREEMENT

   

Peregrine Pharmaceuticals, Inc.

14282 Franklin Avenue

Tustin, CA 92780-7017

Ladies and Gentlemen:

The undersigned (the “Investor”) hereby confirms its agreement with Peregrine Pharmaceuticals, Inc., a Delaware corporation (the “Company”), as follows:

1.   This Subscription Agreement, including the Terms and Conditions for Purchase of Shares attached hereto as Annex I (collectively, this “Agreement”) is made as of the date set forth below between the Company and the Investor.

2.   The Company has authorized the sale and issuance to certain investors of up to an aggregate of 6,252,252 shares of its common stock, par value $0.001 per share (the “Common Stock”),  subject to adjustment by the Company’s Board of Directors or a committee thereof (the “Shares”), for a purchase price of $1.11 per Share (the “Purchase Price”).

3.   The offering and sale of the Shares (the “Offering”) are being made pursuant to: (a) an effective Registration Statement on Form S-3, No. 333-171252 (the “Registration Statement”) filed by the Company with the Securities and Exchange Commission (the “Commission”), including the Prospectus contained therein (the “Base Prospectus”), (b) if applicable, certain “free writing prospectuses” (as that term is defined in Rule 405 under the Securities Act of 1933, as amended (the “Act”)), that have been or will be filed, if required, with the Commission and delivered to the Investor on or prior to the date hereof (the “Issuer Free Writing Prospectus”), containing certain supplemental information regarding the Shares, the terms of the Offering and the Company and (c) a Prospectus Supplement (the “Prospectus Supplement” and, together with the Base Prospectus, the “Prospectus”) containing certain supplemental information regarding the Shares and terms of the Offering that will be filed with the Commission and delivered to the Investor (or made available to the Investor by the filing by the Company of an electronic version thereof with the Commission).

4.   The Company and the Investor agree that the Investor will purchase from the Company and the Company will issue and sell to the Investor the Shares set forth below for the aggregate purchase price set forth below.  The Shares shall be purchased pursuant to the Terms and Conditions for Purchase of Shares attached hereto as Annex I and incorporated herein by this reference as if fully set forth herein.  The Investor acknowledges that the Offering is not being underwritten by Roth Capital Partners, LLC, the placement agent for the Offering (the “Placement Agent”), and that there is no minimum offering amount.

      

  

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5.   The manner of settlement of the Shares purchased by the Investor shall be as follows:

   

Delivery versus payment (“DVP”) through DTC (i.e., on the Closing  Date, the Company shall deliver the Shares to the Placement Agent’s clearing firm registered in the Investor’s name and address as set forth below and released by Integrity Stock Transfer (the “Transfer Agent”) to the Investor through DTC at the Closing directly to the account(s) at the Placement Agent identified by the Investor; upon receipt of such Shares, the Placement Agent shall promptly electronically deliver such Shares to the Investor, and simultaneously therewith payment shall be made by the Placement Agent by wire transfer to the Company).  NO LATER THAN ONE (1) BUSINESS DAY AFTER THE EXECUTION OF THIS AGREEMENT BY THE INVESTOR AND THE COMPANY, THE INVESTOR SHALL:

     

	 	
(I)

	
NOTIFY THE PLACEMENT AGENT OF THE ACCOUNT OR ACCOUNTS AT THE PLACEMENT AGENT TO BE CREDITED WITH THE SHARES BEING PURCHASED BY SUCH INVESTOR, AND

	 	
(II)

	
CONFIRM THAT THE ACCOUNT OR ACCOUNTS AT THE PLACEMENT AGENT TO BE CREDITED WITH THE SHARES BEING PURCHASED BY THE INVESTOR HAVE A MINIMUM BALANCE EQUAL TO THE AGGREGATE PURCHASE PRICE FOR THE SHARES BEING PURCHASED BY THE INVESTOR.

IT IS THE INVESTOR’S RESPONSIBILITY TO ARRANGE FOR SETTLEMENT IN A TIMELY MANNER.

IF THE INVESTOR DOES NOT MAKE PROPER ARRANGEMENTS FOR SETTLEMENT IN A TIMELY MANNER, THE SHARES MAY NOT BE DELIVERED AT CLOSING TO THE INVESTOR OR THE INVESTOR MAY BE EXCLUDED FROM THE CLOSING ALTOGETHER, AT THE COMPANY’S DISCRETION .

6.   The Investor represents that, except as set forth below: (a) it has had no position, office or other material relationship within the past three years with the Company or persons known to it to be affiliates of the Company, (b) it is not a member of the Financial Industry Regulatory Authority, Inc. or an Associated Person (as such term is defined under the NASD Membership and Registration Rules Section 1011) as of the Closing, and (c) neither the Investor nor any group of Investors (as identified in a public filing made with the Commission) of which the Investor is a part in connection with the Offering of the Shares, acquired, or obtained the right to acquire, 20% or more of the Common Stock (or securities convertible into or exercisable for Common Stock) or the voting power of the Company on a post-transaction basis.

Exceptions:

(Please provide a listing of exceptions to the foregoing representations.  If no exceptions, write “none.”  If left blank, response will be deemed to be “none.”)

     

  

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7.   The Investor represents that it has received (or otherwise had made available to it by the filing by the Company of an electronic version thereof with the Commission) the Base Prospectus which is a part of the Company’s Registration Statement, the documents incorporated by reference therein and any free writing prospectus (collectively, the “Disclosure Package”), prior to or in connection with the receipt of this Agreement.  The Investor acknowledges that, prior to the delivery of this Agreement to the Company, the Investor will receive certain additional information regarding the Offering, including pricing information (the “Offering Information”).  Such information may be provided to the Investor by any means permitted under the Act, including the Prospectus Supplement, a free writing prospectus and oral communications.

8.   No offer by the Investor to buy Shares will be accepted and no part of the Purchase Price will be delivered to the Company until the Investor has received the Offering Information and the Company has accepted such offer by countersigning a copy of this Agreement, and any such offer may be withdrawn or revoked, without obligation or commitment of any kind, at any time prior to the Company (or Placement Agent on behalf of the Company) sending (orally, in writing or by electronic mail) notice of its acceptance of such offer.  An indication of interest will involve no obligation or commitment of any kind until the Investor has been delivered the Offering Information and this Agreement is accepted and countersigned by or on behalf of the Company.  The Investor understands and agrees that the Company, in its sole discretion, reserves the right to accept or reject this subscription for Shares, in whole or in part.

9.   The Company acknowledges that the only material, non-public information relating to the Company it has provided to the Investor in connection with the Offering prior to the date hereof is the existence of the Offering.

   

[Signature Page Follows]

     

  

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Number of Shares: __________

Purchase Price Per Share: $1.11

Aggregate Purchase Price: $_________

Please confirm that the foregoing correctly sets forth the agreement between us by signing in the space provided below for that purpose.

Dated as of: September 2, 2011

INVESTOR:

____________________________

By: _____________________

      Name:

      Title:

Address:

_____________________________________________

_____________________________________________

_____________________________________________

_____________________________________________

Agreed and Accepted

this 2nd day of September, 2011:

PEREGRINE PHARMACEUTICALS, INC.

By: _______________________________________

      Name:

      Title:

     

  

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ANNEX I

TERMS AND CONDITIONS FOR PURCHASE OF SHARES

Capitalized terms used but not defined on this Annex I shall have the meanings ascribed to such terms in the Subscription Agreement to which this Annex is attached.

1.   Authorization and Sale of the Shares.  Subject to the terms and conditions of this Agreement, the Company has authorized the sale of the Shares.

2.   Agreement to Sell and Purchase the Shares; Placement Agent.

2.1   At the Closing (as defined in Section 3.1), the Company will sell to the Investor, and the Investor will purchase from the Company, upon the terms and conditions set forth herein, the number of Shares set forth on the last page of the Agreement to which these Terms and Conditions for Purchase of Shares are attached as Annex I (the “Signature Page”) for the aggregate purchase price therefor set forth on the Signature Page.

2.2   The Company proposes to enter into substantially this same form of Subscription Agreement with certain other investors (the “Other Investors”) and expects to complete sales of Shares to them.  The Investor and the Other Investors are hereinafter sometimes collectively referred to as the “Investors,” and this Agreement and the Subscription Agreements executed by the Other Investors are hereinafter sometimes collectively referred to as the “Agreements.”

2.3   Investor acknowledges that the Company has agreed to pay Roth Capital Partners, LLC (the “Placement Agent”) and certain other participants a fee in respect of the sale of Shares to the Investor.

2.4   The Company has entered into a Placement Agency Agreement, dated September 2, 2011 (the “Placement Agreement”), with the Placement Agent that contains certain representations, warranties, covenants and agreements of the Company, each of which may be relied upon by the Investor as if fully set forth herein.  It is specifically agreed that Investor shall be a third party beneficiary of all such representations, warranties, covenants and agreements of the Company.

3.   Closing and Delivery of the Shares and Funds.

3.1   Closing.  The completion of the purchase and sale of the Shares (the “Closing”) shall occur at a place and time (the “Closing Date”) to be specified by the Company and the Placement Agent, and of which the Investors will be notified in advance by the Placement Agent, in accordance with Rule 15c6-1 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  At the Closing, (a) the Company shall cause the Transfer Agent to deliver to the Investor the number of Shares set forth on the Signature Page registered in the name of the Investor or, if so indicated on the Investor Questionnaire attached hereto as Exhibit A, in the name of a nominee designated by the Investor and (b) the aggregate purchase price for the Shares being purchased by the Investor will be delivered by or on behalf of the Investor to the Company.

     

  

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3.2   Conditions to the Obligations of the Parties.

(a)   Conditions to the Company’s Obligations.  The Company’s obligation to issue and sell the Shares to the Investor shall be subject to: (i) the receipt by the Company of the purchase price for the Shares being purchased hereunder as set forth on the Signature Page and (ii) the accuracy of the representations and warranties made by the Investor and the fulfillment of those undertakings of the Investor to be fulfilled prior to the Closing Date.

(b)   Conditions to the Investor’s Obligations.  The Investor’s obligation to purchase the Shares will be subject to the accuracy of the representations and warranties made by the Company and the fulfillment of those undertakings of the Company to be fulfilled prior to the Closing Date, including without limitation, those contained in the Placement Agreement, and to the condition that the Placement Agent shall not have: (i) terminated the Placement Agreement pursuant to the terms thereof or (ii) determined that the conditions to the closing in the Placement Agreement have not been satisfied.  The Investor’s obligations are expressly not conditioned on the purchase by any or all of the Other Investors of the Shares that they have agreed to purchase from the Company.  The Investor understands and agrees that, in the event that the Placement Agent in its sole discretion determines that the conditions to closing in the Placement Agreement have not been satisfied or if the Placement Agreement may be terminated for any other reason permitted by the Placement Agreement, then the Placement Agent may, but shall not be obligated to, terminate the Placement Agreement, which shall have the effect of terminating this Subscription Agreement pursuant to Section 14 below.

3.3   Delivery of Funds.

Delivery Versus Payment through The Depository Trust Company.  No later than one (1) business day after the execution of this Agreement by the Investor and the Company, the Investor shall confirm that the account or accounts at the Placement Agent to be credited with the Shares being purchased by the Investor have a minimum balance equal to the aggregate purchase price for the Shares being purchased by the Investor.

The Investor acknowledges and agrees that no minimum amount is required to be raised in order for the Company and the Placement Agent to close the Offering.

3.4   Delivery of Shares.

Delivery Versus Payment through The Depository Trust Company.  No later than one (1) business day after the execution of this Agreement by the Investor and the Company, the Investor shall notify the Placement Agent of the account or accounts at the Placement Agent to be credited with the Shares being purchased by such Investor.  On the Closing Date, the Company shall cause the Transfer Agent to deliver the Shares to the Investor through DTC directly to the account(s) at the Placement Agent identified by Investor and, upon confirmation that the Shares have been delivered, payment shall be made by the Placement Agent by wire transfer to the Company.

    

  

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4.   Representations, Warranties and Covenants of the Investor.

The Investor acknowledges, represents and warrants to, and agrees with, the Company and the Placement Agent that:

4.1           The Investor: (a) is knowledgeable, sophisticated and experienced in making, and is qualified to make decisions with respect to, investments in shares presenting an investment decision like that involved in the purchase of the Shares, including investments in securities issued by the Company and investments in comparable companies, (b) has answered all questions on the Signature Page and the Investor Questionnaire and the answers thereto are true and correct as of the date hereof and will be true and correct as of the Closing Date and (c) in connection with its decision to purchase the number of Shares set forth on the Signature Page, has received and is relying only upon the Disclosure Package and the documents incorporated by reference therein and the Offering Information.

4.2           (a)  No action has been or will be taken in any jurisdiction outside the United States by the Company or the Placement Agent that would permit an offering of the Shares, or possession or distribution of offering materials in connection with the issue of the Securities in any jurisdiction outside the United States where action for that purpose is required, (b) if the Investor is outside the United States, it will comply with all applicable laws and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers Securities or has in its possession or distributes any offering material, in all cases at its own expense and (c) the Placement Agent is not authorized to make and has not made any representation, disclosure or use of any information in connection with the issue, placement, purchase and sale of the Shares, except as set forth or incorporated by reference in the Disclosure Package or the Prospectus Supplement or any free writing prospectus.

4.3           (a)  The Investor has full right, power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby and has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and (b) this Agreement constitutes a valid and binding obligation of the Investor enforceable against the Investor in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and except as to the enforceability of any rights to indemnification or contribution that may be violative of the public policy underlying any law, rule or regulation (including any federal or state securities law, rule or regulation).

4.4           The Investor understands that nothing in this Agreement, the Prospectus, the Disclosure Package, the Offering Information or any other materials presented to the Investor in connection with the purchase and sale of the Shares constitutes legal, tax or investment advice. The Investor has consulted such legal, tax and investment advisors and made such investigation as it, in its sole discretion, has deemed necessary or appropriate in connection with its purchase of Shares.

    

  

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4.5           Since the date on which the Placement Agent first contacted the Investor about the Offering, the Investor has not disclosed any information regarding the Offering to any third parties (other than its legal, accounting and other advisors who are bound by agreements or duties of confidentiality) and has not engaged in any purchases or sales involving the securities of the Company (including, without limitation, any Short Sales involving the Company’s securities).  The Investor covenants that it will not engage in any purchases or sales involving the securities of the Company (including Short Sales) prior to the time that the transactions contemplated by this Agreement are publicly disclosed.  The Investor agrees that it will not use any of the Securities acquired pursuant to this Agreement to cover any short position in the Common Stock if doing so would be in violation of applicable securities laws.  For purposes hereof, “Short Sales” include, without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act, whether or not against the box, and all types of direct and indirect stock pledges, forward sales contracts, options, puts, calls, short sales, swaps, “put equivalent positions” (as defined in Rule 16a-1(h) under the Exchange Act) and similar arrangements (including on a total return basis), and sales and other transactions through non-US broker dealers or foreign regulated brokers.

5.   Survival of Representations, Warranties and Agreements; Third Party Beneficiary.  Notwithstanding any investigation made by any party to this Agreement or by the Placement Agent, all covenants, agreements, representations and warranties made by the Company and the Investor herein will survive the execution of this Agreement, the delivery to the Investor of the Shares being purchased and the payment therefor.  It is specifically agreed that the Placement Agent shall be a third party beneficiary with respect to the representations, warranties and agreements of the Investor in Section 4 hereof.

6.   Notices.  All notices, requests, consents and other communications hereunder will be in writing, will be mailed (a) if within the domestic United States by first-class registered or certified airmail, or nationally recognized overnight express courier, postage prepaid, or by facsimile or (b) if delivered from outside the United States, by International Federal Express or facsimile, and (c) will be deemed given (i) if delivered by first-class registered or certified mail domestic, three business days after so mailed, (ii) if delivered by nationally recognized overnight carrier, one business day after so mailed, (iii) if delivered by International Federal Express, two business days after so mailed and (iv) if delivered by facsimile, upon electronic confirmation of receipt and will be delivered and addressed as follows:

(a)    if to the Company, to:

Peregrine Pharmaceuticals, Inc.

14282 Franklin Avenue

Tustin, California 92780-7017

Attention: Paul J. Lytle, Chief Financial Officer

Facsimile No.: (714) 838-5817

     

  

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with copies (which shall not constitute notice) to:

Snell & Wilmer LLP

600 Anton Boulevard, Suite 1400

Costa Mesa, California 92626

Facsimile No.: (714) 427-7402

Attention:  Mark R. Ziebell, Esq.

(b)    if to the Investor, at its address on the Signature Page hereto, or at such other address or addresses as may have been furnished to the Company in writing.

7.   Changes.  This Agreement may not be modified or amended except pursuant to an instrument in writing signed by the Company and the Investor.

8.   Headings.  The headings of the various sections of this Agreement have been inserted for convenience of reference only and will not be deemed to be part of this Agreement.

9.   Severability.  In case any provision contained in this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein will not in any way be affected or impaired thereby.

10.   Governing Law.  This Agreement will be governed by, and construed in accordance with, the internal laws of the State of New York, without giving effect to the principles of conflicts of law that would require the application of the laws of any other jurisdiction.

11.   Counterparts.  This Agreement may be executed in two or more counterparts, each of which will constitute an original, but all of which, when taken together, will constitute but one instrument, and will become effective when one or more counterparts have been signed by each party hereto and delivered to the other parties.  Delivery of a signed counterpart of this Agreement by facsimile or other electronic transmission shall constitute valid and sufficient delivery thereof.  The Company and the Investor acknowledge and agree that the Company shall deliver its counterpart to the Investor along with the Prospectus Supplement (or the filing by the Company of an electronic version thereof with the Commission).

12.   Confirmation of Sale.  The Investor acknowledges and agrees that such Investor’s receipt of the Company’s signed counterpart to this Agreement, together with the Prospectus Supplement (or the filing by the Company of an electronic version thereof with the Commission), shall constitute written confirmation of the Company’s sale of the Shares to such Investor.

    

  

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13.   Press Release.  The Company and the Investor agree that the Company shall, prior to the opening of the financial markets in New York City on the business day immediately after the date hereof: (a) issue a press release announcing the Offering and disclosing all material information regarding the Offering and (b) file a Current Report on Form 8-K with the Securities and Exchange Commission including a form of this Agreement as an exhibit thereto.

14.   Termination.  In the event that the Placement Agreement is terminated by the Placement Agent pursuant to the terms thereof, this Agreement shall terminate without any further action on the part of the parties hereto.

[Exhibit A (Investor Questionnaire) Follows]

     

  

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EXHIBIT A

PEREGRINE PHARMACEUTICALS, INC.

INVESTOR QUESTIONNAIRE

Pursuant to Section 3 of Annex I to the Agreement, please provide us with the following information:

1.           The exact name that your Shares are to be registered in.  You may use a nominee name if appropriate:

_____________________________________________________________________

2.           The relationship between the Investor and the registered holder listed in response to item 1 above:

_____________________________________________________________________

3.           The mailing address of the registered holder listed in response to item 1 above:

____________________________________________________

____________________________________________________

____________________________________________________

____________________________________________________

Fax: ________________________________________________

4.           The Social Security Number or Tax Identification Number of the registered holder listed in the response to item 1 above: 

___________________________

5.           Name of DTC Participant (broker-dealer at which the account or accounts to be credited with the Shares are maintained):

6.           DTC Participant Number: ___________________________________________

7.           Name of Account at DTC Participant being credited with the Shares:

_____________________________________________________________________

8.           Account Number at DTC Participant being credited with the Shares:

     

_____________________________________________________________________

 

 

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