EXHIBIT 99.2
PURCHASE AGREEMENT
THIS AGREEMENT is made as of the __ day of July, 2003, by and between
Nabi Biopharmaceuticals (the "Company"), a corporation organized under the laws
of the State of Delaware, with its principal offices at ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇.▇., ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, and the purchaser whose name and
address is set forth on the signature page hereof (the "Purchaser").
IN CONSIDERATION of the mutual covenants contained in this Agreement,
the Company and the Purchaser agree as follows:
SECTION 1. AUTHORIZATION OF SALE OF THE SHARES. Subject to the terms
and conditions of this Agreement, the Company has authorized the issuance and
sale of up to 6,000,000 shares (the "Shares") of common stock, par value $0.10
per share (the "Common Stock"), of the Company.
SECTION 2. AGREEMENT TO SELL AND PURCHASE THE SHARES. At the Closing
(as defined in Section 3), the Company will issue and sell to the Purchaser, and
the Purchaser will buy from the Company, upon the terms and conditions
hereinafter set forth, the number of Shares (at the purchase price) shown below:
PRICE PER
NUMBER TO BE SHARE IN AGGREGATE
PURCHASED DOLLARS PRICE
-------------- --------- ---------
$ $
The Company proposes to enter into the same form of purchase agreement
with certain other investors (the "Other Purchasers") and expects to complete
sales of the Shares at the same price per share to them. The Purchaser and the
Other Purchasers are hereinafter sometimes collectively referred to as the
"Purchasers," and this Agreement and the agreements executed by the Other
Purchasers are hereinafter sometimes collectively referred to as the
"Agreements." The term "Placement Agent" shall mean ▇▇▇▇▇▇ Brothers Inc. The
Company and the Purchaser agree that the obligations of each Purchaser are
several and not joint, and the Purchaser shall not be responsible in any way for
the performance of the obligations of Other Purchasers. Nothing contained in
this Agreement, and no action taken by the Purchaser or any of the Other
Purchasers, shall be deemed to constitute the Purchaser and any or all of the
Other Purchasers as a partnership, an association, a joint venture, or any other
kind of entity, or create the presumption that the Purchaser and any or all of
the Other Purchasers, are in any way acting in concert or as a group with
respect to such obligations or the transactions contemplated by this Agreement.
SECTION 3. DELIVERY OF THE SHARES AT THE CLOSING. The completion of the
purchase and sale of the Shares (the "Closing") shall occur at the offices of
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
as soon as practicable and as agreed to by the parties hereto, within three
business days following the execution of the Agreements, or on such later date
or at such different location as the parties shall agree in writing, but not
prior to the date that the conditions for Closing set forth below have been
satisfied or waived by the appropriate party (the "Closing Date").
At the Closing, the Company shall deliver to the Purchaser one or more
stock certificates registered in the name of the Purchaser, or, if so indicated
on the Stock Certificate Questionnaire attached hereto as Appendix I, in such
nominee name(s) as designated by the Purchaser, representing the number of
Shares set forth in Section 2 above and bearing an appropriate legend referring
to the fact that the Shares were sold in reliance upon the exemption from
registration under the Securities Act of 1933, as amended (the "Securities Act")
provided by Section 4(2) thereof and Rule 506 thereunder. The name(s) in which
the stock certificates are to be registered are set forth in the Stock
Certificate Questionnaire attached hereto as Appendix I. The Company's
obligation to complete the purchase and sale of the Shares and deliver such
stock certificate(s) to the Purchaser at the Closing shall be subject to the
following conditions, any one or more of which may be waived by the Company: (a)
receipt by the Company of same-day funds in the full amount of the purchase
price for the Shares being purchased hereunder; (b) completion of the purchases
and sales under the Agreements with the Other Purchasers; and (c) the accuracy
in all material respects of the representations and warranties made by the
Purchaser herein (as if such representations and warranties were made on the
Closing Date) and the fulfillment of those undertakings of the Purchasers to be
fulfilled prior to the Closing. The Purchaser's obligation to accept delivery of
such stock certificate(s) and to pay for the Shares evidenced thereby shall be
subject to the following conditions, any one or more of which may be waived by
the Purchaser: (a) the accuracy in all material respects of the representations
and warranties of the Company made herein (as if such representations and
warranties were made on the Closing Date), except for those representations and
warranties that address matters as of a particular date, which representations
and warranties shall be accurate in all material respects as of such date; (b)
the delivery to the Purchaser by counsel to the Company of legal opinions
required by Section 4.20 and Section 4.21 in form reasonably satisfactory to
counsel to the Placement Agent; and (c) the fulfillment in all material respects
of those undertakings of the Company to be fulfilled prior to Closing. The
Purchaser's obligations hereunder are expressly conditioned on the purchase by
any or all of the Other Purchasers of at least 4,000,000, but not more than
6,000,000 Shares.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY.
The Company hereby represents and warrants to, and covenants with, the Purchaser
as follows:
4.1 ORGANIZATION AND QUALIFICATION. The Company is a
corporation duly incorporated, validly existing and in good standing
under the laws of the State of Delaware and the Company is qualified to
do business as a foreign corporation in each jurisdiction in which
qualification is required, except where failure to so qualify would not
reasonably be expected to have a Material Adverse Effect (as defined
herein). The material subsidiaries of the Company are listed on Exhibit
A (each a "Subsidiary" and collectively, the "Subsidiaries"). Each
Subsidiary is a direct or indirect wholly owned subsidiary of the
Company. Each Subsidiary is duly organized, validly existing and in
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good standing under the laws of its jurisdiction of organization and is
qualified to do business as a foreign entity in each jurisdiction in
which qualification is required, except where failure to so qualify
would not reasonably be expected to have a Material Adverse Effect. For
purposes of this Agreement, the term "Material Adverse Effect" shall
mean a material adverse effect upon the business, financial condition,
properties or results of operations of the Company and its
Subsidiaries, taken as a whole.
4.2 AUTHORIZED CAPITAL STOCK. The Company had, at the date
indicated therein, the outstanding capital stock set forth under the
heading "Capitalization" in the Confidential Private Placement
Memorandum, dated June 26, 2003 prepared by the Company (together with
all exhibits, supplements and amendments thereto and the documents
incorporated by reference therein, the "Private Placement Memorandum");
the issued and outstanding shares of the Company's Common Stock have
been duly authorized and validly issued, are fully paid and
nonassessable, have been issued in compliance with all federal and
state securities laws, were not issued in violation of or subject to
any preemptive rights or other rights to subscribe for or purchase
securities, and conform in all material respects to the description
thereof contained in the Private Placement Memorandum. Except as
disclosed in the Private Placement Memorandum, the Company does not
have outstanding any options to purchase, or any preemptive rights or
other rights to subscribe for or to purchase, any securities or
obligations convertible into, or any contracts or commitments to issue
or sell, shares of its capital stock or any such options, rights,
convertible securities or obligations. The description of the Company's
stock, stock bonus and other stock plans or arrangements and the
options or other rights granted and exercised thereunder, set forth in
the Private Placement Memorandum accurately and fairly presents all
material information with respect to such plans, arrangements, options
and rights. With respect to each Subsidiary, (i) all the issued and
outstanding shares of each Subsidiary's capital stock have been duly
authorized and validly issued, are fully paid and nonassessable, have
been issued in compliance with applicable federal and state securities
laws, were not issued in violation of or subject to any preemptive
rights or other rights to subscribe for or purchase securities, and
(ii) there are no outstanding options to purchase, or any preemptive
rights or other rights to subscribe for or to purchase, any securities
or obligations convertible into, or any contracts or commitments to
issue or sell, shares of the Subsidiary's capital stock or any such
options, rights, convertible securities or obligations.
4.3 ISSUANCE, SALE AND DELIVERY OF THE SHARES. The Shares have
been duly authorized and, when issued, delivered and paid for in the
manner set forth in this Agreement, will be duly authorized, validly
issued, fully paid and nonassessable and free and clear of all pledges,
liens, restrictions and encumbrances (other than restrictions on
transfer under state and/or federal securities laws) as a result of the
Company's actions, and will conform in all material respects to the
description thereof set forth in the Private Placement Memorandum. No
preemptive rights or other rights to subscribe for or purchase exist
with respect to the issuance and sale of the Shares by the Company
pursuant to this Agreement. No stockholder of the Company has any right
(which has not been waived or has not expired by reason of lapse of
time following notification of the Company's intent to file the
registration statement to be filed by it pursuant to Section 7.1 (the
"Registration Statement")) to require the Company to register the sale
of any shares owned by such stockholder under the Securities Act of
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1933, as amended (the "Securities Act"), in the Registration Statement.
No further approval or authority of the stockholders or the Board of
Directors of the Company will be required for the issuance and sale of
the Shares to be sold by the Company as contemplated herein.
4.4 DUE EXECUTION, DELIVERY AND PERFORMANCE OF THIS AGREEMENT.
The Company has full legal right, corporate power and authority to
enter into this Agreement and perform the transactions contemplated
hereby. This Agreement has been duly authorized, executed and delivered
by the Company. The execution, delivery and performance of this
Agreement by the Company and the consummation of the transactions
herein contemplated will not violate any provision of the certificate
of incorporation or bylaws of the Company or any of its Subsidiaries
and will not result in the creation of any lien, charge, security
interest or encumbrance upon any assets of the Company or any of its
Subsidiaries pursuant to the terms or provisions of, and will not (i)
conflict with, result in the breach or violation of, or constitute,
either by itself or upon notice or the passage of time or both, a
default under (A) any agreement, lease, franchise, license, permit or
other instrument to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or any of
their respective properties may be bound or affected and in each case
which would have a Material Adverse Effect, or (B) to the Company's
knowledge, any statute or any judgment, decree, order, rule or
regulation of any court or any regulatory body, administrative agency
or other governmental body applicable to the Company or any of its
Subsidiaries or any of their respective properties where such conflict,
breach, violation or default is likely to result in a Material Adverse
Effect. No consent, approval, authorization or other order of any
court, regulatory body, administrative agency or other governmental
body is required for the execution and delivery of this Agreement or
the consummation of the transactions contemplated by this Agreement,
except for compliance with the blue sky laws and federal securities
laws applicable to the offering of the Shares. Upon the execution and
delivery of this Agreement, and assuming the valid execution thereof by
the Purchaser, this Agreement will constitute a valid and binding
obligation of the Company, enforceable 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 the indemnification
agreements of the Company in Section 7.3 hereof may be limited by
federal or state securities laws or the public policy underlying such
laws.
4.5 ACCOUNTANTS. The firm of Ernst & Young LLP, which has
expressed its opinion with respect to the consolidated financial
statements to be included or incorporated by reference in the
Registration Statement and the prospectus which forms a part thereof
(the "Prospectus"), is an independent accountant as required by the
Securities Act and the rules and regulations promulgated thereunder
(the "Rules and Regulations").
4.6 NO DEFAULTS. Except as disclosed in the Private Placement
Memorandum, neither the Company nor any of its Subsidiaries is in
violation or default of any provision of its certificate of
incorporation or bylaws, or in breach of or default with respect to any
provision of any agreement, judgment, decree, order, lease, franchise,
license, permit or other instrument to which it is a party or by which
it or any of its properties are bound which could reasonably be
expected to have a Material Adverse Effect and there does not exist any
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state of fact which, with notice or lapse of time or both, would
constitute an event of default as defined in such documents on the part
of the Company or any of its Subsidiaries and which would have a
Material Adverse Effect.
4.7 CONTRACTS. The contracts described in the Private
Placement Memorandum are in full force and effect on the date hereof;
and neither the Company nor any of its Subsidiaries is, nor, to the
Company's knowledge, is any other party in breach of or default under
any of such contracts which would have a Material Adverse Effect.
4.8 NO ACTIONS. Except as disclosed in the Private Placement
Memorandum or in the Company's filings with the Securities and Exchange
Commission, (1) there are no legal or governmental actions, suits or
proceedings pending and (2) to the Company's knowledge, there are no
inquiries or investigations, nor are there any legal or governmental
actions, suits, or proceedings threatened to which the Company or any
of its Subsidiaries is or may be a party or of which property owned or
leased by the Company or any of its Subsidiaries is or may be the
subject, or related to environmental or discrimination matters, which
actions, suits or proceedings, individually or in the aggregate, might
reasonably be expected to have a Material Adverse Effect; and no labor
disturbance by the employees of the Company exists or, to the Company's
knowledge, is imminent which might reasonably be expected to have a
Material Adverse Effect. Neither the Company nor any of its
Subsidiaries is party to or subject to the provisions of any
injunction, judgment, decree or order of any court, regulatory body,
administrative agency or other governmental body which might reasonably
be expected to have a Material Adverse Effect.
4.9 PROPERTIES. The Company and the Subsidiaries have good and
marketable title to all properties and assets reflected as owned in the
financial statements included in the Private Placement Memorandum,
subject to no lien, mortgage, pledge, charge or encumbrance of any kind
except (i) those, if any, reflected in the financial statements
included in the Private Placement Memorandum or otherwise in the
Private Placement Memorandum, (ii) in favor of ▇▇▇▇▇ Fargo Foothill
Inc. under a credit facility and (iii) those which are not material in
amount and do not adversely affect the use of such property by the
Company and its Subsidiaries. To the Company's knowledge, each of the
Company and its Subsidiaries holds its leased properties under valid
and binding leases, with such exceptions as are not materially
significant in relation to its business taken as a whole. Except as
disclosed in the Private Placement Memorandum or in the Company's
filings with the Securities and Exchange Commission, the Company owns
or leases all such properties as are necessary to its operations as now
conducted.
4.10 NO MATERIAL CHANGE. Since December 28, 2002, and except
as described in the Private Placement Memorandum or in the Company's
filings with the Securities and Exchange Commission, (i) the Company
and its Subsidiaries have not incurred any material liabilities or
obligations, indirect, or contingent, or entered into any material oral
or written agreement or other transaction which is not in the ordinary
course of business or which could reasonably be expected to result in a
material reduction in the future earnings of the Company and its
Subsidiaries; (ii) the Company and its Subsidiaries have not sustained
any material loss or interference with their businesses or properties
from fire, flood, windstorm, accident or other calamity not covered by
insurance; (iii) the Company has not paid or declared any dividends or
other distributions with respect to their capital stock and neither the
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Company nor any of its Subsidiaries is in default in the payment of
principal or interest on any outstanding debt obligations; (iv) there
has not been any change in the capital stock of the Company or any of
its Subsidiaries other than the sale of the Shares hereunder, shares or
options issued pursuant to employee equity incentive plans or purchase
plans approved by the Company's Board of Directors and repurchases of
shares or options pursuant to repurchase plans already approved by the
Company's Board of Directors, or indebtedness not incurred in the
ordinary course of business that is material to the Company and its
Subsidiaries, taken as a whole; and (v) there has not been any other
event which has caused a Material Adverse Effect.
4.11 INTELLECTUAL PROPERTY. Except as disclosed in the Private
Placement Memorandum or in the Company's filings with the Securities
and Exchange Commission, to the Company's knowledge: (i) the Company
owns or has obtained valid and enforceable licenses or options for the
inventions, patent applications including any provisional applications,
patents, trademarks (both registered and unregistered), trade names,
copyrights and trade secrets necessary for the conduct of the Company's
business as currently conducted (collectively, the "Intellectual
Property"); and (ii) (a) there are no third parties who have any
ownership rights to any Intellectual Property that is owned by, or has
been licensed to, the Company for the products and services as
described in the Private Placement Memorandum that would preclude the
Company from conducting its business as currently conducted and which
would not reasonably be expected to have a Material Adverse Effect,
except for the ownership rights of the owners of the Intellectual
Property licensed or optioned by the Company; (b) there are currently
no sales or uses of any products or services as described in the
Private Placement Memorandum that would constitute an infringement by
third parties of any Intellectual Property owned, licensed or optioned
by the Company, which infringement would not reasonably be expected
have a Material Adverse Effect; (c) there is no pending or threatened
action, suit, proceeding or claim by others challenging the rights of
the Company in or to any Intellectual Property owned, licensed or
optioned by the Company, which would not reasonably be expected to have
a Material Adverse Effect; (d) there is no pending or threatened
action, suit, proceeding or claim by others challenging the validity or
scope of any Intellectual Property owned, licensed or optioned by the
Company which would not reasonably be expected to have a Material
Adverse Effect; and (e) there is no pending or threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise
violates any patent, trademark, copyright, trade secret or other
proprietary right of others which would not reasonably be expected to
have a Material Adverse Effect.
4.12 COMPLIANCE. Neither the Company nor any of its
Subsidiaries has been advised, nor has reason to believe, that it is
not conducting its business in compliance with all applicable laws,
rules and regulations of the jurisdictions in which it is conducting
its business, including, without limitation, all applicable local,
state and federal environmental laws and regulations, except where
failure to be so in compliance would not have a Material Adverse
Effect.
4.13 TAXES. Each of the Company and its Subsidiaries has filed
all necessary federal, state and foreign income and franchise tax
returns and has paid or accrued all taxes shown as due thereon, and
neither the Company nor any of its Subsidiaries has knowledge of a tax
deficiency which has been or might be asserted or threatened against it
which might reasonably be expected to have a Material Adverse Effect.
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4.14 TRANSFER TAXES. On the Closing Date, all stock transfer
or other taxes (other than income taxes) which are required to be paid
in connection with the sale and transfer of the Shares to be sold to
the Purchaser hereunder will be, or will have been, fully paid or
provided for by the Company and all laws imposing such taxes will be or
will have been complied with.
4.15 INVESTMENT COMPANY. The Company is not an "investment
company" or an "affiliated person" of, or "promoter" or "principal
underwriter" for an investment company, within the meaning of the
Investment Company Act of 1940, as amended.
4.16 OFFERING MATERIALS. The Company has not distributed and
will not distribute prior to the Closing Date any offering material in
connection with the offering and sale of the Shares other than the
Private Placement Memorandum or any amendment or supplement thereto.
Neither the Company nor any person acting on its behalf has in the past
or will hereafter take any action independent of the Placement Agent to
sell, offer for sale or solicit offers to buy any securities of the
Company which would subject the offer, issuance or sale of the Shares,
as contemplated by this Agreement, to the registration requirements of
Section 5 of the Securities Act.
4.17 INSURANCE. The Company and its Subsidiaries maintain
insurance of the types and in the amounts that the Company believes is
reasonably adequate for their businesses, including, but not limited
to, insurance covering all real and personal property leased by the
Company and its Subsidiaries against theft, damage, destruction, acts
of vandalism and all other risks customarily insured against by
similarly situated companies, all of which insurance is in full force
and effect.
4.18 ADDITIONAL INFORMATION. The information contained in the
following documents, which the Placement Agent has furnished to the
Purchaser, or will furnish prior to the Closing, does not include any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances in which they were made, not
misleading, as of their respective filing dates or, if amended, as so
amended:
(a) the Company's Annual Report on Form 10-K for the year
ended December 28, 2002;
(b) the Company's Quarterly Report on Form 10-Q for the
quarter ended March 29, 2003;
(c) the Company's Current Report on Form 8-K filed on June 23,
2003;
(d) the Company's definitive Proxy Statement for the Annual
Meeting of Stockholders held on May 16, 2003;
(e) the draft Registration Statement;
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(f) the Private Placement Memorandum, including all addenda
and exhibits thereto (other than the Purchase Agreement and the Appendices); and
(g) all other documents, if any, filed by the Company with the
Commission since December 28, 2002 pursuant to the reporting requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
4.19 PRICE OF COMMON STOCK. The Company has not taken, and
will not take, directly or indirectly, any action designed to cause or
result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price
of the shares of the Common Stock to facilitate the sale or resale of
the Shares.
4.20 CORPORATE LEGAL OPINION. At the Closing, the Company will
use its best efforts to cause legal counsel to the Company to deliver
one or more legal opinions to the Placement Agent in a form reasonably
satisfactory to the Placement Agent and its counsel. Such opinions also
shall state that each of the Purchasers may rely thereon as though it
were addressed directly to such Purchaser.
4.21 INTELLECTUAL PROPERTY OPINION. At the Closing, the
Company will use its best efforts to cause its intellectual property
counsel to deliver one or more legal opinions to the Placement Agent in
a form reasonably satisfactory to the Placement Agent and its counsel.
4.22 CERTIFICATE. At the Closing, the Company will deliver to
Purchaser a certificate executed by the chief executive officer and the
chief financial or accounting officer of the Company, dated as of the
Closing Date, in form and substance reasonably satisfactory to the
Purchasers, to the effect that the representations and warranties of
the Company set forth in this Section 4 are true and correct as of the
date of this Agreement and as of the Closing Date and that the Company
has complied with all the agreements and satisfied all the conditions
herein on its part to be performed or satisfied on or prior to such
Closing Date.
4.23 REPORTING COMPANY; FORM S-3. The Company is subject to
the reporting requirements of the Exchange Act and has filed all
reports required thereby since May 31, 2002. The Company is eligible to
register the Shares for resale by the Purchaser on a registration
statement on Form S-3 under the Securities Act. To the Company's
knowledge, there exist no facts or circumstances (including without
limitation any required approvals or waivers or any circumstances that
may delay or prevent the obtaining of accountant's consents) that
reasonably could be expected to prohibit or delay the preparation and
filing of a registration statement on Form S-3 that will be available
for the resale of the Shares by the Purchaser.
4.24 USE OF PROCEEDS. The Company shall use the proceeds from
the sale of Shares as described under "Use of Proceeds" in the Private
Placement Memorandum.
4.25 NON-PUBLIC INFORMATION. The Company has not disclosed to
the Purchaser, whether in the Private Placement Memorandum or
otherwise, information that would constitute material non-public
information as of the Closing Date. The Company acknowledges that the
Purchaser will be relying on such representation in effecting
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transactions in the Company's securities following the Closing Date.
The Company acknowledges that it will not disclose any material
non-public information to the Purchaser following the Closing Date.
4.26 USE OF PURCHASER NAME. Except as may be required by
applicable law or regulation, the Company shall not use the Purchaser's
name or the name of any of its affiliates in any advertisement,
announcement, press release or other similar public communication
unless it has received the prior written consent of the Purchaser for
the specific use contemplated or as otherwise required by applicable
law or regulation.
4.27 RELATED PARTY TRANSACTIONS. No transaction has occurred
between or among the Company, any of the Subsidiaries and their
affiliates, officers or directors or any affiliate or affiliates of any
such officer or director that is required to have been described under
applicable securities laws in its Exchange Act filings and is not so
described in such filings.
4.28 OFF-BALANCE SHEET ARRANGEMENTS. There is no transaction,
arrangement or other relationship between the Company and an
unconsolidated or other off-balance sheet entity that is required to be
disclosed by the Company in its Exchange Act filings and is not so
disclosed or that otherwise would be reasonably likely to have a
Material Adverse Effect. There are no such transactions, arrangements
or other relationships with the Company that may create contingencies
or liabilities that are not otherwise disclosed by the Company in its
Exchange Act filings.
4.29 GOVERNMENTAL PERMITS, ETC. Each of the Company and its
Subsidiaries has all franchises, licenses, certificates and other
authorizations from such federal, state or local government or
governmental agency, department or body that are currently required for
the operation of the business of the Company and its Subsidiaries as
currently conducted, except where the failure to posses currently such
franchises, licenses, certificates and other authorizations is not
reasonably expected to have a Material Adverse Effect. The Company and
its Subsidiaries have not received any notice of proceedings relating
to the revocation or modification of any such permit which, if the
subject of an unfavorable decision, ruling or finding, could reasonably
be expected to have a Material Adverse Effect.
4.30 FINANCIAL STATEMENTS. The consolidated financial
statements of the Company and the related notes contained in its
Exchange Act filings present fairly in all material respects, in
accordance with generally accepted accounting principles, the
consolidated financial position of the Company and its Subsidiaries as
of the dates indicated, and the results of their operations, cash flows
and the changes in stockholders' equity for the periods therein
specified, subject, in the case of unaudited financial statements for
interim periods, to normal year-end audit adjustments and the absence
of full footnote disclosure as required by generally accepted
accounting principles. Such consolidated financial statements
(including the related notes) have been prepared in all material
respects in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods therein specified,
except as otherwise described therein and except that unaudited
financial statements may not contain all footnotes required by
generally accepted accounting principles.
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4.31 LISTING. In the two years prior to the date of this
Agreement, the Company has not received written or oral notice from the
Nasdaq National Market to the effect that the Company is not in
compliance with the listing or maintenance requirements thereof. The
Company is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with the listing or
maintenance requirements for continued trading of the Company's Common
Stock on the Nasdaq National Market. The Company shall comply with all
requirements of the Nasdaq National Market with respect to the issuance
of Shares and shall use its best efforts to have the Shares listed on
the Nasdaq National Market on or before the first date that the
Registration Statement is declared effective by the Commission.
4.32 PRESS RELEASE AND FORM 8-K. Promptly following the
Closing but in no event later than one business day following the
Closing Date, the Company shall issue a press release and file a
Current Report on Form 8-K with the Securities and Exchange Commission.
The press release and Current Report on Form 8-K will set forth the
material terms of the transactions contemplated by this Agreement.
SECTION 5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER.
(a) The Purchaser represents and warrants to, and covenants with, the Company
that: (i) the Purchaser is knowledgeable, sophisticated and experienced in
making, and is qualified to make, decisions with respect to investments in
shares representing an investment decision like that involved in the purchase of
the Shares, including investments in securities issued by the Company and
comparable entities, and has had the opportunity to request, receive, review and
consider all information it deems relevant in making an informed decision to
purchase the Shares; (ii) the Purchaser is acquiring the number of Shares set
forth in Section 2 above in the ordinary course of its business and for its own
account for investment purposes only and with no present intention of
distributing any of such Shares, and no arrangement or understanding exists with
any other persons regarding the distribution of such Shares (this representation
and warranty not limiting the Purchaser's right to sell pursuant to the
Registration Statement or in compliance with the Securities Act and the Rules
and Regulations, or, other than with respect to any claims arising out of a
breach of this representation and warranty, the Purchaser's right to
indemnification under Section 7.3); (iii) the Purchaser will not, directly or
indirectly, except (as to each of (A), (B) and (C)) in compliance with the
Securities Act, the Rules and Regulations and such other securities or Blue Sky
laws as may be applicable, (A) offer, sell, pledge, transfer or otherwise
dispose of (or solicit any offers to buy, purchase or otherwise acquire or take
a pledge of any of the Shares, (B) engage in any short sale which results in a
disposition of any of the Shares by Purchaser, or (C) hedge the economic risk of
the Purchaser's investment in the Shares; (iv) the Purchaser has completed or
caused to be completed the Registration Statement Questionnaire attached hereto
as part of Appendix I, for use in preparation of the Registration Statement, and
the answers thereto are true and correct in all material respects as of the date
hereof and will be true and correct in all material respects as of the effective
date of the Registration Statement and the Purchaser will notify the Company
immediately of any material change in any such information provided in the
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Registration Statement Questionnaire until such time as the Purchaser has sold
all of its Shares or until the Company is no longer required to keep the
Registration Statement effective; (v) the Purchaser has, in connection with its
decision to purchase the number of Shares set forth in Section 2 above, relied
solely upon the Private Placement Memorandum and the documents included therein
or incorporated by reference and the representations and warranties of the
Company contained herein; (vi) the Purchaser has had an opportunity to discuss
this investment with representatives of the Company and ask questions of them;
(vii) the Purchaser is an "accredited investor" within the meaning of Rule
501(a) of Regulation D promulgated under the Securities Act ; and (vii) the
Purchaser agrees to notify the Company immediately of any change in any of the
foregoing information until such time as the Purchaser has sold all of its
Shares or the Company is no longer required to keep the Registration Statement
effective.
(b) The Purchaser understands that the Shares are being
offered and sold to it in reliance upon specific exemptions from the
registration requirements of the Securities Act, the Rules and Regulations and
state securities laws and that the Company is relying upon the truth and
accuracy of, and the Purchaser's compliance with, the representations,
warranties, agreements, acknowledgments and understandings of the Purchaser set
forth herein in order to determine the availability of such exemptions and the
eligibility of the Purchaser to acquire the Shares.
(c) For the benefit of the Company, the Purchaser previously
agreed orally with the Placement Agent to keep confidential all information
concerning this private placement. The Purchaser understands that the
information contained in the Private Placement Memorandum is being submitted to
the Purchaser solely for such Purchaser's confidential use. The Purchaser agrees
to use the information contained in the Private Placement Memorandum for the
sole purpose of evaluating a possible investment in the Shares and the Purchaser
hereby acknowledges that it is prohibited from reproducing or distributing the
Private Placement Memorandum, this Agreement, or any other offering materials or
other information provided by the Company in connection with the Purchaser's
consideration of its investment in the Company, in whole or in part, or
divulging or discussing any of their contents, except to its financial,
investment or legal advisors in connection with its proposed investment in the
Shares, which advisors shall also be bound by this paragraph. Further, the
Purchaser understands that the existence and nature of all conversations and
presentations, if any, regarding the Company and this offering must be kept
strictly confidential. The Purchaser understands that the federal securities
laws impose restrictions on trading based on information regarding this
offering. In addition, the Purchaser hereby acknowledges that unauthorized
disclosure of information regarding this offering may result in a violation of
Regulation FD. This obligation will terminate upon the issuance by the Company
of a press release or press releases describing this offering to the extent of
the information contained in such press release or press releases. In addition
to the above, the Purchaser shall maintain in confidence the receipt and content
of any notice of a Suspension (as defined in Section 5(h) below). The foregoing
agreements shall not apply to any information that is or becomes publicly
available through no fault of the Purchaser, or that the Purchaser is legally
required to disclose; provided, however, that if the Purchaser is requested or
ordered to disclose any such information pursuant to any court or other
government order or any other applicable legal procedure, it shall provide the
Company with prompt notice of any such request or order in time sufficient to
enable the Company to seek an appropriate protective order.
(d) The Purchaser understands that its investment in the
Shares involves a significant degree of risk, including a risk of total loss of
the Purchaser's investment, and the Purchaser has full cognizance of and
understands all of the risk factors related to the Purchaser's purchase of the
Shares, including, but not limited to, those set forth under the caption "Risk
Factors" in the Private Placement Memorandum. The Purchaser understands that the
market price of the Common Stock has been volatile and that no representation is
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being made as to the future value of the Common Stock. The Purchaser has the
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of an investment in the Shares and has the
ability to bear the economic risks of an investment in the Shares.
(e) The Purchaser understands that no United States federal or
state agency or any other government or governmental agency has passed upon or
made any recommendation or endorsement of the Shares.
(f) The Purchaser understands that, until such time as the
Shares have been sold pursuant to the Registration Statement or may be sold by
non-affiliates pursuant to Rule 144 under the Securities Act without any
restriction as to the number of securities as of a particular date that can then
be immediately sold, the Shares will bear a restrictive legend in substantially
the following form (and a stop-transfer order may be placed against the transfer
of the certificates for the Shares)::
"The Shares evidenced by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act"), or the securities laws of any state or
other jurisdiction. The Shares may not be offered, sold,
pledged or otherwise transferred except (1) pursuant to an
exemption from registration under the Securities Act or (2)
pursuant to an effective registration statement under the
Securities Act, in each case in accordance with all applicable
securities laws of the states and other jurisdictions, and in
the case of a transaction exempt from registration, unless the
Company has received an opinion of counsel reasonably
satisfactory to it that such transaction does not require
registration under the Securities Act and such other
applicable laws."
(g) The Purchaser's principal executive offices are in the
jurisdiction set forth immediately below the Purchaser's name on the signature
pages hereto.
(h) The Purchaser hereby covenants with the Company not to
make any sale of the Shares under the Registration Statement without complying
with the provisions of this Agreement and without effectively causing the
prospectus delivery requirement under the Securities Act to be satisfied, and
the Purchaser acknowledges and agrees that such Shares are not transferable on
the books of the Company unless the certificate submitted to the transfer agent
evidencing the Shares is accompanied by a separate Purchaser's Certificate of
Subsequent Sale: (i) in the form of Appendix II hereto, (ii) executed by an
officer of, or other authorized person designated by, the Purchaser, and (iii)
to the effect that (A) the Shares have been sold in accordance with the
Registration Statement, the Securities Act and any applicable state securities
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or blue sky laws and (B) the requirement of delivering a current prospectus has
been satisfied. The Purchaser will notify the Company promptly after the sale of
all of its Shares. The Purchaser acknowledges that there may occasionally be
times when the Company must suspend the use of the Prospectus forming a part of
the Registration Statement (a "Suspension") until such time as an amendment to
the Registration Statement has been filed by the Company and declared effective
by the Commission, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The Purchaser hereby
covenants that it will not sell any Shares pursuant to said Prospectus during
the period commencing at the time at which the Company gives the Purchaser
written notice of the Suspension of the use of said Prospectus and ending at the
time the Company gives the Purchaser written notice that the Purchaser may
thereafter effect sales pursuant to said Prospectus. Notwithstanding the
foregoing, the Company agrees that no Suspension shall be for a period of longer
than 30 consecutive days, and no Suspension shall be for a period of an
aggregate in any 365-day period of longer than 60 days; provided that the
Company shall remain liable for liquidated damages pursuant to Section 7 hereof
with respect to any Suspensions exceeding the aforementioned permitted periods.
(i) The Purchaser further represents and warrants to, and
covenants with, the Company that (i) the Purchaser 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, (ii) the making and
performance of this Agreement by the Purchaser and the consummation of the
transactions herein contemplated will not violate any provision of the
organizational documents of the Purchaser or conflict with, result in the breach
or violation of, or constitute, either by itself or upon notice or the passage
of time or both, a default under any material agreement, mortgage, deed of
trust, lease, franchise, license, indenture, permit or other instrument to which
the Purchaser is a party, or any statute or any authorization, judgment, decree,
order, rule or regulation of any court or any regulatory body, administrative
agency or other governmental body applicable to the Purchaser, (iii) no consent,
approval, authorization or other order of any court, regulatory body,
administrative agency or other governmental body is required on the part of the
Purchaser for the execution and delivery of this Agreement or the consummation
of the transactions contemplated by this Agreement, (iv) upon the execution and
delivery of this Agreement, this Agreement shall constitute a legal, valid and
binding obligation of the Purchaser, enforceable 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 to the extent enforcement of the
indemnification provisions, set forth in Section 7.3 of this Agreement, may be
limited by federal or state securities laws or the public policy underlying such
laws, and (v) there is not in effect any order enjoining or restraining the
Purchaser from entering into or engaging in any of the transactions contemplated
by this Agreement.
SECTION 6. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
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 Purchaser herein and in the certificates for the Shares
delivered pursuant hereto shall survive the execution of this Agreement, the
delivery to the Purchaser of the Shares being purchased and the payment
therefore.
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SECTION 7. REGISTRATION OF THE SHARES; COMPLIANCE WITH THE SECURITIES
ACT.
7.1 REGISTRATION PROCEDURES AND EXPENSES. The Company shall:
(a) as soon as reasonably practicable, but in no event later
than fifteen (15) business days following the Closing Date (such date, the
"Filing Date"), prepare and file with the Commission the Registration Statement
on Form S-3 or other available form relating to the sale of the Shares by the
Purchaser and the Other Purchasers from time to time on the Nasdaq National
Market or the facilities of any national securities exchange on which the Common
Stock is then traded or in privately-negotiated transactions;
(b) use its best efforts, subject to receipt of necessary
information from the Purchasers, to cause the Commission to declare the
Registration Statement effective within 60 days after the Closing Date (such
date, the "Required Effective Date"). However, so long as the Company filed the
Registration Statement by the Filing Date, if the Registration Statement
receives Commission review, then the Required Effective Date will be the
ninetieth (90th) calendar day after the Closing Date;
(c) use its best efforts to promptly prepare and file with the
Commission such amendments and supplements to the Registration Statement and the
prospectus used in connection therewith as may be necessary to keep the
Registration Statement effective, subject to receipt of necessary information
from the Purchasers, until the earliest of (i) two years after the effective
date of the Registration Statement, or (ii) such time as the Shares become
eligible for resale by non-affiliates pursuant to Rule 144(k) under the
Securities Act of 1933, as amended;
(d) furnish to the Purchaser with respect to the Shares
registered under the Registration Statement (and to each underwriter, if any, of
such Shares) such number of copies of prospectuses and such other documents as
the Purchaser may reasonably request, in order to facilitate the public sale or
other disposition of all or any of the Shares by the Purchaser;
(e) file documents required of the Company for normal Blue Sky
clearance in states specified in writing by the Purchaser; PROVIDED, HOWEVER,
that the Company shall not be required to qualify to do business or subject
itself to taxation or consent to service of process in any jurisdiction in which
it is not now so qualified, so subjected or has not so consented;
(f) bear all expenses in connection with the procedures in
paragraphs (a) through (e) of this Section 7.1 and the registration of the
Shares pursuant to the Registration Statement, other than fees and expenses, if
any, of counsel or other advisers to the Purchaser or the Other Purchasers or
underwriting discounts, brokerage fees and commissions incurred by the Purchaser
or the Other Purchasers, if any;
(g) file a Form D with respect to the Shares as required under
Regulation D and to provide a copy thereof to the Purchaser promptly after
filing;
(h) issue a press release describing the transactions
contemplated by this Agreement on the Closing Date;
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(i) notify promptly the Purchaser of the effectiveness of the
Registration Statement and any post-effective amendments thereto; and
(j) make available, while the Registration Statement is
effective and available for resale, its Chief Executive Officer and Chief
Financial Officer for questions regarding information which the Purchaser may
reasonably request in order to fulfill any due diligence obligation on its part.
The Company understands that the Purchaser disclaims being an
underwriter, but the Purchaser being deemed an underwriter shall not relieve the
Company of any obligations it has hereunder. A draft of the proposed form of the
Registration Statement is included in the Private Placement Memorandum and a
questionnaire related thereto to be completed by the Purchaser is attached
hereto as Appendix I.
7.2 TRANSFER OF SHARES AFTER REGISTRATION. The Purchaser
agrees that it will not effect any disposition of the Shares or its
right to purchase the Shares that would constitute a sale within the
meaning of the Securities Act or any applicable state securities laws,
except as contemplated in the Registration Statement referred to in
Section 7.1 or as otherwise permitted by law, and that it will promptly
notify the Company of any changes in the information set forth in the
Registration Statement regarding the Purchaser or its plan of
distribution.
7.3 INDEMNIFICATION. For the purpose of this Section 7.3:
(i) the term "Purchaser/Affiliate" shall mean any
affiliate of the Purchaser, including a transferee
who is an affiliate of the Purchaser, and any
person who controls the Purchaser or any affiliate
of the Purchaser within the meaning of Section 15
of the Securities Act or Section 20 of the
Exchange Act; and
(ii) the term "Registration Statement" shall
include any preliminary prospectus, final
prospectus, exhibit, supplement or amendment
included in or relating to, and any document
incorporated by reference in, the Registration
Statement referred to in Section 7.1.
(a) The Company agrees to indemnify and hold harmless each
Purchaser and each Purchaser/Affiliate against any losses, claims, damages,
liabilities or expenses, joint or several, to which such Purchaser or
Purchaser/Affiliate may become subject, under the Securities Act, the Exchange
Act, or any other federal or state statutory law or regulation, or at common law
or otherwise (including in settlement of any litigation, if such settlement is
effected with the prior written consent of the Company), insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof as
contemplated below) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, including the Prospectus, financial statements and schedules, and all
other documents filed as a part thereof, as amended at the time of effectiveness
of the Registration Statement, including any information deemed to be a part
thereof as of the time of effectiveness pursuant to paragraph (b) of Rule 430A,
or pursuant to Rule 434, of the Rules and Regulations, or the Prospectus, in the
form first filed with the Commission pursuant to Rule 424(b) of the Regulations,
or filed as part of the Registration Statement at the time of effectiveness if
no Rule 424(b) filing is required, or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state in any
-15-
of them a material fact required to be stated therein or necessary to make the
statements in any of them, in light of the circumstances under which they were
made, not misleading, and will promptly reimburse each such Purchaser and each
such Purchaser/Affiliate for any legal and other expenses as such expenses are
reasonably incurred by such Purchaser or such Purchaser/Affiliate in connection
with investigating, defending or preparing to defend, settling, compromising or
paying any such loss, claim, damage, liability, expense or action; PROVIDED,
HOWEVER, that the Company will not be liable in any such case to the extent, but
only to the extent, that any such loss, claim, damage, liability or expense
arises out of or is based upon (i) an untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement,
the Prospectus or any amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
the Purchaser expressly for use therein, or (ii) the failure of such Purchaser
to comply with the covenants and agreements contained in Sections 5 or 7.2, or
(iii) any statement or omission in any Prospectus that is corrected in any
subsequent Prospectus that was delivered to the Purchaser prior to the pertinent
sale or sales by the Purchaser.
(b) Each Purchaser will severally indemnify and hold harmless
the Company, each of its directors, each of its officers who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act, against any losses, claims, damages, liabilities or expenses to which the
Company, each of its directors, each of its officers who signed the Registration
Statement or controlling person may become subject, under the Securities Act,
the Exchange Act, or any other federal or state statutory law or regulation, or
at common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of such Purchaser) insofar as
such losses, claims, damages, liabilities or expenses (or actions in respect
thereof as contemplated below) arise out of or are based upon (i) any failure to
comply with the covenants and agreements contained in Sections 5 or 7.2 hereof,
or (ii) any untrue or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in the Registration Statement, the Prospectus, or
any amendment or supplement thereto, in reliance upon and in conformity with
written information furnished to the Company by or on behalf of any Purchaser
expressly for use therein, and will reimburse the Company, each of its
directors, each of its officers who signed the Registration Statement or
controlling person for any legal and other expense reasonably incurred by the
Company, each of its directors, each of its officers who signed the Registration
Statement or controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage, liability,
expense or action.
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(c) Promptly after receipt by an indemnified party under this
Section 7.3 of notice of the threat or commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party under this Section 7.3, promptly notify the indemnifying
party in writing thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to any indemnified
party for contribution or otherwise under the indemnity agreement contained in
this Section 7.3 to the extent it is not prejudiced as a result of such failure.
In case any such action is brought against any indemnified party and such
indemnified party seeks or intends to seek indemnity from an indemnifying party,
the indemnifying party will be entitled to participate in, and, to the extent
that it may wish, jointly with all other indemnifying parties similarly
notified, to assume the defense thereof with counsel reasonably satisfactory to
such indemnified party; PROVIDED, HOWEVER, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded, based on an opinion of
counsel reasonably satisfactory to the indemnifying party, that there may be a
conflict of interest between the positions of the indemnifying party and the
indemnified party in conducting the defense of any such action or that there may
be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of its election to assume
the defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 7.3 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed such counsel in connection with the
assumption of legal defenses in accordance with the proviso to the preceding
sentence or (ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of action, in each
of which cases the reasonable fees and expenses of counsel shall be at the
expense of the indemnifying party (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, reasonably satisfactory to such indemnifying party,
representing all of the indemnified parties who are parties to such action). In
no event shall any indemnifying party be liable in respect of any amounts paid
in settlement of any action unless the indemnifying party shall have approved in
writing the terms of such settlement; PROVIDED that such consent shall not be
unreasonably withheld. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnification could have been sought hereunder by such
indemnified party from all liability on claims that are the subject matter of
such proceeding.
(d) If the indemnification provided for in this Section 7.3 is
required by its terms but is for any reason held to be unavailable to or
otherwise insufficient to hold harmless an indemnified party under paragraphs
(a), (b) or (c) of this Section 7.3 in respect to any losses, claims, damages,
liabilities or expenses referred to herein, then each applicable indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of any losses, claims, damages, liabilities or expenses referred to
herein (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Purchaser from the private placement of Common
Stock hereunder or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but the relative
fault of the Company and the Purchaser in connection with the statements or
omissions or inaccuracies in the representations and warranties in this
Agreement and/or the Registration Statement which resulted in such losses,
-17-
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The respective relative benefits received by the
Company on the one hand and each Purchaser on the other shall be deemed to be in
the same proportion as the amount paid by such Purchaser to the Company pursuant
to this Agreement for the Shares purchased by such Purchaser that were sold
pursuant to the Registration Statement bears to the difference (the
"Difference") between the amount such Purchaser paid for the Shares that were
sold pursuant to the Registration Statement and the amount received by such
Purchaser from such sale. The relative fault of the Company, on the one hand,
and each Purchaser on the other shall be determined by reference to, among other
things, whether the untrue or alleged statement of a material fact or the
omission or alleged omission to state a material fact or the inaccurate or the
alleged inaccurate representation and/or warranty relates to information
supplied by the Company or by such Purchaser and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in paragraph (c) of this
Section 7.3, any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim. The
provisions set forth in paragraph (c) of this Section 7.3 with respect to the
notice of the threat or commencement of any threat or action shall apply if a
claim for contribution is to be made under this paragraph (d); PROVIDED,
HOWEVER, that no additional notice shall be required with respect to any threat
or action for which notice has been given under paragraph (c) for purposes of
indemnification. The Company and each Purchaser agree that it would not be just
and equitable if contribution pursuant to this Section 7.3 were determined
solely by pro rata allocation (even if the Purchaser were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in this paragraph.
Notwithstanding the provisions of this Section 7.3, no Purchaser shall be
required to contribute any amount in excess of the amount by which the
Difference exceeds the amount of any damages that such Purchaser has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Purchasers' obligations to contribute pursuant to this
Section 7.3 are several and not joint.
7.4 TERMINATION OF CONDITIONS AND OBLIGATIONS. The
restrictions imposed by Section 5 or this Section 7 upon the
transferability of the Shares shall cease and terminate as to any
particular number of the Shares upon the passage of two years from the
effective date of the Registration Statement covering such Shares or at
such time as an opinion of counsel satisfactory in form and substance
to the Company shall have been rendered to the effect that such
conditions are not necessary in order to comply with the Securities
Act.
-18-
7.5 INFORMATION AVAILABLE. So long as the Registration
Statement covering the resale of Shares owned by the Purchaser is
effective, the Company will furnish to the Purchaser
(a) as soon as practicable after available (but in the case of
the Annual Report to the Stockholders, within 150 days after the end of each
fiscal year of the Company), one copy of (i) its Annual Report to Stockholders
(which Annual Report shall contain financial statements audited in accordance
with generally accepted accounting principles by a national firm of certified
public accountants), (ii) if not included in substance in the Annual Report to
Stockholders, upon the request of Purchaser, its Annual Report on Form 10-K,
(iii) upon request of Purchaser, its quarterly reports on Form 10-Q, and (iv) a
full copy of the particular Registration Statement covering the Shares (the
foregoing, in each case, excluding exhibits);
(b) upon the reasonable request of the Purchaser, a reasonable
number of copies of the Prospectuses, and any supplements thereto, to supply to
any other party requiring such Prospectuses;
and the Company, upon the reasonable request of the Purchaser and with prior
notice, will be available to the Purchaser or a representative thereof at the
Company's headquarters to discuss information relevant for disclosure in the
Registration Statement covering the Shares and will otherwise cooperate with any
Purchaser conducting an investigation for the purpose of reducing or eliminating
such Purchaser's exposure to liability under the Securities Act, including the
reasonable production of information at the Company's headquarters, subject to
appropriate confidentiality limitations.
7.6 COOPERATION. It shall be a condition precedent to the
obligations of the Company to take any action under Section 7.1 that
the Purchaser shall forward to the Company all such information and
materials and shall take all action as may be reasonably required to
permit the Company to comply with the applicable requirements of the
Securities Act and the Securities and Exchange Commission.
7.7 DELAY IN FILING OR EFFECTIVENESS OF REGISTRATION
STATEMENT. If the Registration Statement is not filed by the Company
with the Commission on or prior to the Filing Date, then for each day
following the Filing Date, until but excluding the date the
Registration Statement is filed, or if the Registration Statement is
not declared effective by the Commission by the Required Effective
Date, then for each day following the Required Effective Date, until
but excluding the date the Commission declares the Registration
Statement effective, the Company shall, for each such day, pay the
Purchaser with respect to any such failure, as liquidated damages and
not as a penalty, an amount equal to 0.0333% of the purchase price paid
by such Purchaser for its Shares pursuant to this Agreement; and for
any such day, such payment shall be made no later than the first
business day of the calendar month next succeeding the month in which
such day occurs. If the Purchaser shall be prohibited from selling
Shares under the Registration Statement as a result of a Suspension of
more than thirty (30) days or Suspensions on more than two (2)
occasions of not more than thirty (30) days each in any 12-month
period, then for each day on which a Suspension is in effect that
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exceeds the maximum allowed period for a Suspension or Suspensions, but
not including any day on which a Suspension is lifted, the Company
shall pay the Purchaser, as liquidated damages and not as a penalty, an
amount equal to 0.0333% of the purchase price paid by such Purchaser
for its Shares pursuant to this Agreement for each such day, and such
payment shall be made no later than the first business day of the
calendar month next succeeding the month in which such day occurs. For
purposes of this Section 7.7, a Suspension shall be deemed lifted on
the date that notice that the Suspension has been lifted is delivered
to the Purchaser pursuant to Section 9 of this Agreement. Any payments
made pursuant to this Section 7.7. shall not constitute the Purchaser's
exclusive remedy for such events. Notwithstanding the foregoing
provisions, in no event shall the Company be obligated to pay such
liquidated damages to more than one Purchaser in respect of the same
Shares for the same period of time. Such payments shall be made to the
Purchaser in cash.
SECTION 8. BROKER'S FEE. The Purchaser acknowledges that the Company
intends to pay to the Placement Agent a fee in respect of the sale of the Shares
to the Purchaser. The Purchaser and the Company hereby agree that the Purchaser
shall not be responsible for such fee and that the Company will indemnify and
hold harmless the Purchaser and each Purchaser/Affiliate against any losses,
claims, damages, liabilities or expenses, joint or several, to which such
Purchaser or Purchaser/Affiliate may become subject with respect to such fee.
Each of the parties hereto hereby represents that, on the basis of any actions
and agreements by it, there are no other brokers or finders entitled to
compensation in connection with the sale of the Shares to the Purchaser.
SECTION 9. NOTICES. All notices, requests, consents and other
communications required or permitted hereunder shall be in writing and shall be
deemed effectively given: (i) upon delivery to the party to be notified; (ii)
when received by confirmed facsimile or (iii) one (1) business day after deposit
with a nationally recognized overnight carrier, specifying next business day
delivery, with written verification of receipt. All communications shall be sent
to the Company and the Purchaser as follows or at such other addresses as the
Company or the Purchaser may designate upon ten (10) days' advance written
notice to the other party:
(a) if to the Company, to:
Nabi Biopharmaceuticals
▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇.▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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(b) if to the Purchaser, at its address as set forth at the
end of this Agreement.
SECTION 10. CHANGES. This Agreement may not be modified or amended
except pursuant to an instrument in writing signed by the Company and the
Purchaser. No provision hereunder may be waived other than in a written
instrument executed by the waiving party.
SECTION 11. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 12. 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 shall not in any way be affected or impaired thereby.
SECTION 13. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York and the federal
law of the United States of America. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby ("Related Proceedings") may be instituted in the federal courts of the
United States of America located in New York, New York (collectively, the
"Specified Courts"), and each party irrevocably submits to the non-exclusive
jurisdiction of such Specified Courts of such courts in any such suit, action or
proceeding. Service of any process, summons, notice or document by mail to such
party's address set forth above shall be effective service of process for any
suit, action or other proceeding brought in any such court. The parties
irrevocably and unconditionally waive any objection to the laying of venue of
any suit, action or other proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such suit, action or other proceeding brought in any such court has been brought
in an inconvenient forum. With respect to any Related Proceeding, each party
irrevocably waives, to the fullest extent permitted by applicable law, all
immunity (whether on the basis of sovereignty or otherwise) from jurisdiction,
service of process, attachment (both before and after judgment) and execution to
which it might otherwise be entitled in the Specified Courts or any other court
of competent jurisdiction.
SECTION 14. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered (including by facsimile) to the other parties.
SECTION 15. ENTIRE AGREEMENT. This Agreement and the instruments
referenced herein contain the entire understanding of the parties with respect
to the matters covered herein and therein and, except as specifically set forth
herein or therein, neither the Company nor the Purchaser makes any
representation, warranty, covenant or undertaking with respect to such matters.
SECTION 16. ASSIGNMENT. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of, and be binding upon, the
parties hereto and their respective permitted successors, assigns, heirs,
executors and administrators. This Agreement and the rights of the Purchaser
-21-
hereunder may be assigned by the Purchaser with the prior written consent of the
Company, except such consent shall not be required in cases of assignments by an
investment adviser to a fund for which it is the adviser or by or among funds
that are under common control, provided that such assignee agrees to be bound by
the terms of this Agreement.
SECTION 17. FURTHER ASSURANCES. Each party agrees to cooperate fully
with the other parties and to execute such further instruments, documents and
agreements and to give such further written assurance as may be reasonably
requested by any other party to evidence and reflect the transactions described
herein and contemplated hereby and to carry into effect the intents and purposes
of this Agreement.
[Remainder of Page Left Intentionally Blank]
-22-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the day and year first
above written.
NABI BIOPHARMACEUTICALS
By
---------------------------------
Print or Type:
Name of Purchaser
(Individual or Institution):
------------------------------------
Name of Individual representing
Purchaser (if an Institution):
------------------------------------
Title of Individual
representing Purchaser (if an
Institution):
------------------------------------
Signature by:
Individual Purchaser or Individual
representing Purchaser:
------------------------------------
Address:
---------------------------
Telephone:
--------------------------
Telecopier:
-------------------------
-23-
SUMMARY INSTRUCTION SHEET FOR PURCHASER
(to be read in conjunction with the entire
Purchase Agreement which this follows)
A. Complete the following items on BOTH Purchase Agreements
(Please sign two originals):
1. Page 23 - Signature:
(i) Name of Purchaser (Individual or Institution)
(ii) Name of Individual representing Purchaser (if an
Institution)
(iii) Title of Individual representing Purchaser (if an
Institution)
(iv) Signature of Individual Purchaser or Individual
representing Purchaser
2. Appendix I - Stock Certificate Questionnaire/Registration
Statement Questionnaire:
Provide the information requested by the Stock Certificate
Questionnaire and the Registration Statement Questionnaire.
3. Return BOTH properly completed and signed Purchase Agreements
including the properly completed Appendix I to (initially by
facsimile with hard copy by overnight delivery):
▇▇▇▇▇▇ Brothers Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
B. Instructions regarding the transfer of funds for the
purchase of Shares will be sent by facsimile to the Purchaser
by the Placement Agent at a later date.
C. Upon the resale of the Shares by the Purchasers after the
Registration Statement covering the Shares is effective, as
described in the Purchase Agreement, the Purchaser:
(i) must deliver a current prospectus of the Company to
the buyer (prospectuses must be obtained from the
Company at the Purchaser's request); and
(ii) must send a letter in the form of Appendix II to the
Company so that the Shares may be properly
transferred.
Appendix I
(Page 1 of 3)
NABI BIOPHARMACEUTICAL
STOCK CERTIFICATE QUESTIONNAIRE
Pursuant to Section 3 of the Agreement, please provide us with the
following information:
1. The exact name that your Shares are to be registered in
(this is the name that will appear on your stock
certificate(s)). You may use a nominee name if
appropriate:
-------------
2. The relationship between the Purchaser of the Shares 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:
-------------
-------------
-------------
-------------
4. The Social Security Number or Tax Identification Number of
the Registered Holder listed in response to item 1 above:
-------------
Appendix I
(Page 2 of 3)
NABI BIOPHARMACEUTICAL
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement,
please provide us with the following information:
SECTION 1. Pursuant to the "Selling Stockholder" section of the
Registration Statement, please state your or your organization's name exactly as
it should appear in the Registration Statement:
SECTION 2. Please provide the number of shares that you or your
organization will own immediately after Closing, including those Shares
purchased by you or your organization pursuant to this Purchase Agreement and
those shares purchased by you or your organization through other transactions:
SECTION 3. Have you or your organization had any position, office or
other material relationship within the past three years with the Company or its
affiliates?
_____ Yes _____ No
If yes, please indicate the nature of any such relationships below:
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SECTION 4. Are you (i) an NASD Member (see definition), (ii) a
Controlling (see definition) shareholder of an NASD Member, (iii) a Person
Associated with a Member of the NASD (see definition), or (iv) an Underwriter or
a Related Person (see definition) with respect to the proposed offering; or (b)
do you own any shares or other securities of any NASD Member not purchased in
the open market; or (c) have you made any outstanding subordinated loans to any
NASD Member?
Answer: [ ] Yes [ ] No If "yes," please describe below
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Appendix I
(Page 3 of 3)
NASD MEMBER. The term "NASD member" means either any broker or dealer
admitted to membership in the National Association of Securities Dealers, Inc.
("NASD"). (NASD Manual, By-laws Article I, Definitions)
CONTROL. The term "control" (including the terms "controlling,"
"controlled by" and "under common control with") means the possession, direct or
indirect, of the power, either individually or with others, to direct or cause
the direction of the management and policies of a person, whether through the
ownership of voting securities, by contract, or otherwise. (Rule 405 under the
Securities Act of 1933, as amended)
PERSON ASSOCIATED WITH A MEMBER OF THE NASD. The term "person
associated with a member of the NASD" means every sole proprietor, partner,
officer, director, branch manager or executive representative of any NASD
Member, or any natural person occupying a similar status or performing similar
functions, or any natural person engaged in the investment banking or securities
business who is directly or indirectly controlling or controlled by a NASD
Member, whether or not such person is registered or exempt from registration
with the NASD pursuant to its bylaws. (NASD Manual, By-laws Article I,
Definitions)
UNDERWRITER OR A RELATED PERSON. The term "underwriter or a related
person" means, with respect to a proposed offering, underwriters, underwriters'
counsel, financial consultants and advisors, finders, members of the selling or
distribution group, and any and all other persons associated with or related to
any of such persons.
(NASD Interpretation)
APPENDIX II
[Transfer Agent]
[Address]
Attention:
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
The undersigned, [an officer of, or other person duly authorized by]
_____________________________________________________________ hereby certifies
[fill in official name of individual or institution]
that he/she [said institution] is the Purchaser of the shares evidenced by the
attached certificate, and as such, sold such shares on _______________ in
[date]
accordance with the terms of the Purchase Agreement and in accordance with
Registration Statement number
___________________________________________________________________ or
[fill in the number of or otherwise identify Registration Statement]
otherwise in accordance with the Securities Act of 1933, as amended, and, in the
case of a transfer pursuant to the Registration Statement, the requirement of
delivering a current prospectus by the Company has been complied with in
connection with such sale.
Print or Type:
Name of Purchaser
(Individual or
Institution): ______________________
Name of Individual
representing
Purchaser (if an
Institution) ______________________
Title of Individual
representing
Purchaser (if an
Institution): ______________________
Signature by:
Individual Purchaser
or Individual repre-
senting Purchaser: ______________________
EXHIBIT A
NAME OF SUBSIDIARY JURISDICTION OF FORMATION
Nabi Foreign Sales, Ltd. Barbados, West Indies
BioMune Corporation Delaware
