Item 1.01. Entry into a Material Definitive Agreement.
On December 30, 2008, XenoPort, Inc. ("XenoPort" or the "Company") entered
into purchase agreements (the "Purchase Agreements") with select institutional
investors (the "Investors"), relating to the sale and issuance by the Company of
up to 1,889,467 units (the "Units"), with each Unit consisting of (i) one share
of the Company's common stock, par value $0.001 per share ("Common Stock"), and
(ii) a warrant to purchase 0.15 of a share of Common Stock. The Investors agreed
to purchase the Units at a purchase price of $21.17 per Unit. In the aggregate,
the Company would issue up to 1,889,467 shares of Common Stock (the "Shares")
and warrants to purchase up to 283,420 shares of Common Stock (the "Warrants")
pursuant to the terms of the Purchase Agreements. The Warrants to be issued to
each Investor would generally be exercisable beginning on the date of issuance
and at any time up to the date that is five years from the date of issuance, and
would carry an exercise price of $25.40 per share. The Warrants may be exercised
for cash or, if at any time during the exercisability period the fair market
value of the Common Stock exceeds the exercise price of the Warrants, each
holder of a Warrant may, at its election, effect a cashless exercise of such
Warrant. The Investors are funds affiliated with Maverick Capital and Venrock
Healthcare Capital Partners, LP and VCHP Co-Investment Holdings, LLC. The net
offering proceeds to the Company from the sale of the Units, after deducting
estimated offering expenses payable by the Company, are expected to be
approximately $39.7 million.
The Shares, the Warrants and the shares of Common Stock issuable upon
exercise of the Warrants (together, the "Securities") are being offered and sold
pursuant to the Company's effective shelf registration statement on Form S-3
(Registration No. 333-156485), the related prospectus included therein (the
"Prospectus"), a free writing prospectus and a prospectus supplement to the
Prospectus. The legal opinion of Cooley Godward Kronish LLP relating to the
Securities is filed as Exhibit 5.1 to this Current Report on Form 8-K.
The closing of the sale and issuance of the Units is expected to take place
on or prior to January 5, 2009, subject to the satisfaction of customary closing
conditions.
The foregoing is only a brief description of the material terms of the
Warrants and the Purchase Agreements, does not purport to be a complete
description of the rights and obligations of the parties thereunder and is
qualified in its entirety by reference to the form of Warrant and the form of
the Purchase Agreement, respectively, that are filed as Exhibits 4.1 and 10.1 to
this Current Report on Form 8-K and incorporated by reference herein.
On December 30, 2008, the Company issued a press release announcing the
offering described above. A copy of the press release is attached hereto as
Exhibits 99.1 and incorporated herein by reference.
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