Exhibit 10.2
[DIRECT PLACEMENT GRAPHIC]
0000 Xxxxx Xxxxx - Xxxxx 000 - Xxx Xxxxx - XX 00000
Tel: (858) 623 - 1600 - Fax: (000) 000-0000
MAY 1, 2002
Xx. Xxxxx X. Xxxxxxxx
Vice Chairman
Biopure Corporation
000 Xxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, XX 00000
Dear Xx. Xxxxxxxx,
This agreement amends, restates and supersedes in its entirety the
Agreement dated April 1, 2002 between DP Securities, Inc. ("DP" or the
"PLACEMENT AGENT") and Biopure Corporation (the "COMPANY").
The purpose of this letter agreement (the "AGREEMENT") is to set forth
the terms and conditions pursuant to which DP shall serve as placement
agent in connection with the proposed placement of common stock (the
"PLACEMENT") of the Company. Such agency shall apply to up to three (3)
institutional investors (the "Investors") which the Placement Agent may
introduce to the company1. Placement Agent may assist the Company in
raising an amount of capital not to exceed Five Million Five Hundred
Thousand Dollars ($5,500,000). All securities will be sold pursuant to an
effective shelf registration statement and appropriate prospectus
supplements (the "SHELF") and, at the time of the Placement, will be free
from any contractual restriction or lock-up agreement. Upon the terms and
subject to the conditions of this Agreement, the parties hereto agree as
follows:
1. APPOINTMENT. Subject to the terms and conditions of this Agreement
hereinafter set forth, the Company hereby retains DP, and DP hereby
agrees to act as the Company's placement agent and financial advisor
exclusively in connection with the Placement, effective as of the date
hereof. The Company expressly acknowledges and agrees that DP's
obligations hereunder are on a reasonable best efforts basis only and
that the execution of this Agreement does not constitute a commitment by
DP to purchase the securities and does not ensure the successful
placement of the securities or any portion thereof or the success of DP
with respect to securing any other financing on behalf of the Company. DP
will act solely as a broker with respect to identifying and negotiating
with potential investors in securities that may be issued in the
Placement. DP will not act as an underwriter in any such transaction. DP
understands that the Shelf has been declared effective by the SEC.
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1 None of the Investors shall have been previously introduced to the Company or
solicited by any other agent of the Company with respect to any recent capital
raising efforts of the Company. "Investors" shall include affiliates.
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2. FEES AND COMPENSATION. In consideration of the services rendered by
DP in connection with the Placement, the Company agrees to pay DP the
following fees and other compensation on the closing date of the
Placement:
(a) A cash fee equal to 5.00% of the funds raised in the Placement;
(b) A warrant fee equal to a 4-year warrant limited to purchase 3% of
the number of shares sold in the Placement by the Placement Agent,
exercisable at the closing price of the common stock on date of the
closing of the Placement.The warrants will include a cashless
exercise feature, and standard piggy-back registration rights and
anti-dilution clauses. The warrants will be restricted from sale,
transfer, assignment or hypothecation for a period of one year from
the closing date except to officers or partners (not directors) of
the Placement Agent.
(c) In the event that the offering is terminated, the Placement Agent
will only be entitled to fees to the extent securities of the
Company are placed by the Placement Agent.
3. TERMS OF RETENTION.
(a) In the event that a Placement has not been successfully consummated
on terms satisfactory to the Company within 7 business days from the
date of the execution hereof, the Company may at any time terminate
this agreement. In addition, the Company may terminate this
agreement at any time, in the event the Investors are not acceptable
to the Company, or if the terms of the proposed Placement are not
acceptable.
(b) Notwithstanding anything herein to the contrary, the provisions of
Exhibit A paragraphs 2, 4, 5, 6, and 8 and all of Exhibit B and
Exhibit C attached hereto, each of which exhibits is incorporated
herein by reference, shall survive any termination or expiration of
the Agreement.
4. REGISTRATION. In preparation for the Placement, the Company has filed
with the SEC a shelf registration statement. From time to time in
connection with any particular sale of Securities, the Company will, at
its own expense, obtain any registration or qualification required to
sell any Securities under the Blue Sky laws of any applicable
jurisdictions, as reasonably requested by DP, and shall pay any filing
fees required by NASD Regulation, Inc. in connection with their review of
the terms of this Agreement, if so required. Further, the Company will
prepare and submit all necessary filings with, and pay all requested fees
to, the principal exchange or electronic trading system on which the
securities are traded or quoted.
5. NO GENERAL SOLICITATION. The securities will be offered only by
approaching three prospective institutional investors on an individual
basis after the identities of such investors have been disclosed to the
Company, been approved by the Company and determined to comply with
Footnote 1 on page 1 hereof. No general solicitation or general
advertising in any form will be used in connection with the offering of
the securities. From and after the execution of this Agreement until the
completion of the Placement, the Company shall pre-clear any proposed
press release that mentions this Agreement or the Placement with DP.
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6. CLOSING(S). The closing of any Placement shall be subject to
customary closing conditions, including the provision by the Company
to DP of officers' certificates, opinions of counsel and "cold comfort"
letters from the Company's auditors.
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7. MISCELLANEOUS. This Agreement together with the attached Exhibits A
through C constitutes the entire understanding and agreement between the
parties with respect to its subject matter and there are no agreements or
understandings with respect to the subject matter hereof which are not
contained in this Agreement. This Agreement may be modified only in
writing signed by the party to be charged hereunder.
SIGNATURE PAGE FOLLOWS
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If the foregoing correctly sets forth our agreement, please confirm this
by signing and returning to us the duplicate copy of this letter.
We appreciate this opportunity to be of service and are looking forward
to working with you on this matter.
Sincerely,
DP SECURITIES, INC.
By: _________________________________
Name: Xxxxxx X. Xxxx
Title: President
Agreed to and Accepted as of the date first written above:
BIOPURE CORPORATION
By: ________________________
Name: Xxxxx X. Xxxxxxxx
Title: Vice Chairman
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EXHIBIT A
STANDARD TERMS AND CONDITIONS
1.The Company shall promptly provide DP with all relevant information
about the Company (to the extent available to the Company in the case of
parties other than the Company) that shall be reasonably requested or
required by DP, which information shall be complete and accurate in all
material respects at the time furnished.
2.DP shall keep all information obtained from the Company strictly
confidential except: (a) information which is otherwise publicly
available, or previously known to, or obtained by DP independently of the
Company and without breach of DP's agreement with the Company; (b) DP may
disclose such information to its employees and attorneys, and to its
other advisors and financial sources on a need to know basis only and
shall use best efforts to ensure that all such employees, attorneys,
advisors and financial sources will keep such information strictly
confidential; and (c) pursuant to any order of a court of competent
jurisdiction or other governmental body (including any subpoena) or as
may otherwise be required by law.
3.The Company recognizes that in order for DP to perform properly its
obligations in a professional manner, it is necessary that DP be informed
of and, to the extent practicable, participate in meetings and
discussions between the Company and any third party, including, without
limitation, any prospective purchaser of the Securities, relating to the
matters covered by the terms of DP's engagement.
4.The Company agrees that any report or opinion, oral or written,
delivered to it by DP is prepared solely for its confidential use and
shall not be reproduced, summarized, or referred to in any public
document or given or otherwise divulged to any other person without DP's
prior written consent, except as may be required by applicable law or
regulation.
0.Xx fee payable to DP pursuant to any other agreement with the Company
or payable by the Company to any agent, lender or investor shall reduce
or otherwise affect any fee payable by the Company to DP hereunder. If DP
engages any other broker-dealer or other finder to assist DP in the
placement of the Placement, then the fees of such other broker-dealer or
finder shall be paid by DP.
6.The Company represents and warrants that: (a) it has full right, power
and authority to enter into this Agreement and to perform all of its
obligations hereunder; (b) this Agreement has been duly authorized and
executed by and constitutes a valid and binding agreement of the Company
enforceable in
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accordance with its terms; and (c) the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby do
not conflict with or result in a breach of (i) the Company's certificate
of incorporation or by-laws. Further, this agreement and the transactions
contemplated herein shall not conflict with or result in the breach of
any agreement to which the Company is a party at the time the
transactions contemplated herein are consummated.
7.Nothing contained in this Agreement shall be construed to place DP and
the Company in the relationship of partners or joint venturers. Neither
DP nor the Company shall represent itself as the agent or legal
representative of the other for any purpose whatsoever nor shall either
have the power to obligate or bind the other in any manner whatsoever.
DP, in performing its services hereunder, shall at all times be an
independent contractor.
8.This Agreement has been and is made solely for the benefit of DP and
the Company and each of the persons, agents, employees, officers,
directors and controlling persons referred to in Exhibit B and their
respective heirs, executors, personal representatives, successors and
assigns, and nothing contained in this Agreement shall confer any rights
upon, nor shall this Agreement be construed to create any rights in, any
person who is not party to such Agreement, other than as set forth in
this paragraph.
9.The rights and obligations of either party under this Agreement may not
be assigned without the prior written consent of the other party hereto
and any other purported assignment shall be null and void.
10. All communications hereunder, except as may be otherwise specifically
provided herein, shall be in writing and shall be mailed, hand delivered,
or sent by an overnight courier service, via facsimile and confirmed by
letter, to the following addresses or such other address as such party
may advise the other in writing:
TO THE COMPANY:
Biopure Corporation
000 Xxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000)-000-0000
TO DP:
DP Securities, Inc.
0000 Xxxxx Xx. Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All notices hereunder shall be effective upon receipt by the party to
which it is addressed.
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EXHIBIT B
INDEMNIFICATION
The Company agrees that it shall indemnify and hold harmless, DP, its
stockholders, directors, officers, employees, agents, affiliates and
controlling persons within the meaning of Section 20 of the Securities
Exchange Act of 1934 and Section 15 of the Securities Act of 1933, each
as amended (any and all of whom are referred to as an "INDEMNIFIED
PARTY"), from and against any and all losses, claims, damages,
liabilities, or expenses, and all actions in respect thereof (including,
but not limited to, all legal or other expenses reasonably incurred by an
Indemnified Party in connection with the investigation, preparation,
defense or settlement of any claim, action or proceeding, whether or not
resulting in any liability), incurred by an Indemnified Party: (a)
arising out of, or in connection with, any actions taken or omitted to be
taken by the Company, its affiliates, employees or agents, or any untrue
statement or alleged untrue statement of a material fact contained in any
of the financial or other information contained in the registration
statement and/or final prospectus furnished to DP by or on behalf of the
Company or the omission or alleged omission of a material fact required
to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; or
(b) with respect to, caused by, or otherwise arising out of any
transaction contemplated by the Agreement or DP's performing the services
contemplated hereunder; provided, however, the Company will not be liable
under clause (b) hereof to the extent, and only to the extent, that any
loss, claim, damage, liability or expense is finally judicially
determined to have resulted primarily from DP's gross negligence or bad
faith in performing such services or resulted primarily from writings
prepared by DP.
If the indemnification provided for herein is conclusively determined (by
an entry of final judgment by a court of competent jurisdiction and the
expiration of the time or denial of the right to appeal) to be
unavailable or insufficient to hold any Indemnified Party harmless in
respect to any losses, claims, damages, liabilities or expenses referred
to herein, then the Company shall contribute to the amounts paid or
payable by such Indemnified Party in such proportion as is appropriate
and equitable under all circumstances taking into account the relative
benefits received by the Company on the one hand and DP on the other,
from the transaction or proposed transaction under the Agreement or, if
allocation on that basis is not permitted under applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
received by the Company on the one hand and DP on the other, but also the
relative fault of the Company and DP; provided, however, in no event
shall the aggregate contribution of DP and/or any Indemnified Party be in
excess of the net compensation actually received by DP and/or such
Indemnified Party pursuant to this Agreement.
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The Company shall not settle or compromise or consent to the entry of any
judgment in or otherwise seek to terminate any pending or threatened
action, claim, suit or proceeding in which any Indemnified Party is or
could be a party and as to which indemnification or contribution could
have been sought by such Indemnified Party hereunder (whether or not such
Indemnified Party is a party thereto), unless such consent or termination
includes an express unconditional release of such Indemnified Party,
reasonably satisfactory in form and substance to such Indemnified Party,
from all losses, claims, damages, liabilities or expenses arising out of
such action, claim, suit or proceeding.
In the event any Indemnified Party shall incur any expenses covered by
this Exhibit B, the Company shall reimburse the Indemnified Party for
such covered expenses within ten (10) business days of the Indemnified
Party's delivery to the Company of an invoice therefor, with receipts
attached. Such obligation of the Company to so advance funds may be
conditioned upon the Company's receipt of a written undertaking from the
Indemnified Party to repay such amounts within ten (10) business days
after a final, non-appealable judicial determination that such
Indemnified Party was not entitled to indemnification hereunder.
The foregoing indemnification and contribution provisions are not in lieu
of, but in addition to, any rights which any Indemnified Party may have
at common law hereunder or otherwise, and shall remain in full force and
effect following the expiration or termination of DP's engagement and
shall be binding on any successors or assigns of the Company and
successors or assigns to all or substantially all of the Company's
business or assets.
[DIRECT PLACEMENT GRAPHIC]
EXHIBIT C
JURISDICTION
Any controversy or claim relating to or arising from this Agreement
("ARBITRABLE DISPUTE") shall be settled by arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration Association
(the "AAA") as such rules may be modified herein or as otherwise agreed
by the parties in controversy. The forum for arbitration shall be New
York, New York. Following thirty (30) days notice by any party of
intention to invoke arbitration, any Arbitrable Dispute arising under
this Agreement and not mutually resolved within such thirty (30) day
period shall be determined by a single arbitrator upon which the parties
agree.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York, without regard to conflicts of law
principles.
