SUBSCRIPTION AGREEMENT
dated as of December 22, 1999
by and between
THERMOGENESIS CORP.
and
-----------------------------
--------------------
SERIES B CONVERTIBLE PREFERRED STOCK
and
COMMON STOCK PURCHASE WARRANTS
SUBSCRIPTION AGREEMENT
SERIES B CONVERTIBLE PREFERRED STOCK
and
COMMON STOCK PURCHASE WARRANTS
THERMOGENESIS CORP.
TABLE OF CONTENTS
Page
1. AGREEMENT TO
SUBSCRIBE.............................................................1
(a)
Subscription...................................................1
(b) Form of Payment................................................1
(c) Method of Payment..............................................2
2. BUYER REPRESENTATIONS, WARRANTIES, ETC................................2
(a) Purchase for Investment........................................2
(b) Accredited Investor............................................2
(c) Reoffers and Resales...........................................2
(d) Company Reliance...............................................2
(e) Information Provided...........................................2
(f) Absence of Approvals...........................................3
(g) Subscription Agreement.........................................3
3. COMPANY REPRESENTATIONS, WARRANTIES, ETC.............................3
(a) Organization and Authority.....................................3
(b) Capitalization.................................................3
(c) Concerning the Shares and the Common Stock.....................4
(d) Subscription Agreement and Other Transaction Documents.........4
(e) Non-contravention..............................................4
(f) Approvals......................................................5
(g) Information Provided...........................................5
(h) Absence of Certain Changes.....................................5
(i) Absence of Certain Proceedings.................................6
(j) Properties.....................................................6
(k) Labor Relations................................................7
(l) SEC Filings....................................................7
(m) Absence of Brokers, Finders, Etc..............................7
(n) No Solicitation................................................7
(o) Certain Issuances of Securities................................7
(p) Absence of Rights Agreement....................................7
4. CERTAIN COVENANTS AND ACKNOWLEDGMENTS.................................8
(a) Transfer Restrictions.........................................8
(b) Restrictive Legend.............................................8
(c) Registration Rights Agreement.................................9
(d) Form D.........................................................9
(e) Authorization for Trading......................................9
(f) Use of Proceeds................................................9
(g) Blue Sky Laws.................................................10
(h) Certain Expenses..............................................10
(i) Certain Issuances of Securities...............................10
(j) Certain Selling Restrictions..................................11
(k) Best Efforts..................................................11
5. TRANSFER AGENT AGREEMENT.............................................11
(a) Transfer Agent Agreement......................................11
(b) Conversion Procedure..........................................12
6. CLOSING DATE.........................................................12
7. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL AND ISSUE.............12
8. CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE.....................12
9. MISCELLANEOUS........................................................13
(a) Governing Law.................................................13
(b) Counterparts..................................................13
(c) Headings, etc.................................................13
(d) Severability..................................................14
(e) Amendments....................................................14
(f) Waivers.......................................................14
(g) Notices.......................................................14
(h) Assignment....................................................14
(i) Survival of Representations and Warranties....................14
(j) Entire Agreement..............................................14
(k) Termination...................................................14
(l) Further Assurances............................................15
(m) Public Statements, Press Releases, Etc........................15
(n) Construction..................................................15
SCHEDULES
Schedule 3(a) Subsidiaries
Schedule 3(b) Antidilution Adjustments
Schedule 3(c)-1 Participation Rights
Schedule 3(c)-2 Nasdaq Matters
Schedule 3(i) Certain Proceedings
Schedule 3(n) Sales of Securities
ANNEXES
Annex I Form of Certificate of Designations
Annex II Form of Common Stock Purchase Warrant
Annex III Joint Escrow Instructions
Annex IV Form of Registration Rights Agreement
Annex V Form of Transfer Agent Agreement
Annex VI Form of Notice of Conversion of Series B Convertible
Preferred Stock
Annex VII Form of Opinion of Counsel to Be Delivered on Closing Date
Annex VIII Form of Opinion of General Counsel of the Company to Be
Delivered on Closing Date
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT, dated as of December 22, 1999, by
and between THERMOGENESIS CORP., a Delaware corporation (the "Company"), with
headquarters located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
and ▇▇▇▇ INVESTMENT GROUP LIMITED, a Delaware corporation (the "Buyer").
W I T N E S S E T H:
WHEREAS, the Buyer wishes to purchase, upon the terms and subject
to the conditions of this Agreement, shares of non-voting, convertible preferred
stock of the Company which will be convertible into shares of Common Stock,
$.001 par value (the "Common Stock"), of the Company and in connection therewith
the Company is to issue to the Buyer warrants to purchase shares of Common Stock
as provided in this Agreement; and
WHEREAS, the Company and the Buyer are executing and delivering
this Agreement in reliance upon the exemption from securities registration
afforded by Rule 506 of Regulation D ("Regulation D") as promulgated by the
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "1933 Act");
NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE.
(a) Subscription. The Buyer hereby agrees to purchase from the
Company the number of shares (the "Preferred Shares") of Series B Convertible
Preferred Stock, $.001 par value (the "Preferred Stock"), of the Company set
forth on the signature page of this Agreement, having the terms and conditions
as set forth in the form of the Certificate of Designations of the Series B
Convertible Preferred Stock attached hereto as Annex I (the "Certificate of
Designations") at the price per share and for the aggregate purchase price set
forth on the signature page of this Agreement (the "Purchase Price"). In
connection with the purchase of the Preferred Shares by the Buyer, the Company
shall issue to the Buyer, at the closing on the Closing Date (as defined
herein), Common Stock Purchase Warrants in the form attached hereto as Annex II
(the "Warrants") to purchase a number of shares of Common Stock equal to the
amount obtained by multiplying (i) the quotient obtained by dividing (x) the
Purchase Price by (y) the average closing bid price of the Common Stock on the
Nasdaq SmallCap Market ("Nasdaq") for the ten consecutive trading days
immediately prior to the Closing Date times (ii) 0.25 (subject to adjustment
after issuance of the Warrants as provided in the Warrants). The shares of
Common Stock issuable upon exercise of the Warrants are referred to herein as
the "Warrant Shares." The Warrant Shares and the shares of Common Stock issuable
upon conversion of the Preferred Shares are referred to herein collectively as
the "Common Shares." The Common Shares and the Preferred Shares are referred to
herein collectively as the "Shares." The Shares and the Warrants are referred to
herein collectively as the "Securities."
(b) Form of Payment. The Buyer shall pay the Purchase Price for
the Preferred Shares by delivering good funds in United States Dollars to the
escrow agent (the "Escrow Agent") identified in the Joint Escrow Instructions
attached hereto as Annex III (the "Joint Escrow Instructions"). Such delivery of
funds shall be made against delivery by the Company of the certificates for the
Preferred Shares and the Warrants registered in the name of the Buyer or its
nominee. Promptly following payment by the Buyer to the Escrow Agent of the
Purchase Price, but in any event prior to the Closing Date, the Company shall
deliver certificates for the Preferred Shares and the Warrants, registered in
the name of the Buyer or its nominee, to the Escrow Agent. The certificates for
the Preferred Shares shall be delivered by the Company to the Escrow Agent on a
delivery against payment basis at the closing. By signing this Agreement, the
Buyer and the Company each agrees to all of the terms and conditions of, and
becomes a party to, the Joint Escrow Instructions, all of the provisions of
which are incorporated herein by this reference as if set forth in full.
(c) Method of Payment. Payment of the Purchase Price for the
Preferred Shares shall be made by wire transfer of funds to:
Citibank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ABA#▇▇▇▇▇▇▇▇▇
For credit to A/C#37179446
For credit to the account of ▇▇▇▇▇ ▇. ▇▇▇▇▇ Attorney Escrow
Account, Reference: ▇▇▇▇/ThermoGenesis
Not later than 4:00 p.m., New York City time, on the date which is two Business
Days after the Company shall have accepted this Agreement and returned a signed
counterpart of this Agreement to the Buyer or its legal counsel, the Buyer shall
deposit with the Escrow Agent an amount equal to the Purchase Price. As used in
this Agreement, the term "Business Day" means any day other than a Saturday,
Sunday or other day on which commercial banks in The City of New York are
authorized or required by law to remain closed.
2. BUYER REPRESENTATIONS, WARRANTIES, ETC.
The Buyer represents and warrants to, and covenants and agrees
with, the Company as follows:
(a) Purchase for Investment. The Buyer is purchasing the
Preferred Shares and acquiring the Warrants, and will acquire the Common Shares
upon conversion of the Preferred Shares or exercise of the Warrants, for its own
account for investment only and not with a view towards the public sale or
distribution thereof;
(b) Accredited Investor. The Buyer is an "accredited investor" as
that term is defined in Rule 501 of the General Rules and Regulations under the
1933 Act by reason of Rule 501(a)(3);
(c) Reoffers and Resales. All subsequent offers and sales of the
Securities by the Buyer shall be made pursuant to registration of the Securities
being offered and sold under the 1933 Act or pursuant to an exemption from
registration;
(d) Company Reliance. The Buyer understands that the Preferred
Shares are being offered and sold, the Warrants are being issued, and the Common
Shares are being offered, in each case to it in reliance on specific exemptions
from the registration requirements of United States federal and state securities
laws and that the Company is relying upon the truth and accuracy of, and the
Buyer's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of the Buyer
to acquire the Preferred Shares and the Warrants and to receive an offer of the
Common Shares;
(e) Information Provided. The Buyer and its advisors, if any,
have been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
Preferred Shares and the issuance of the Warrants and the offer of the Common
Shares which have been requested by the Buyer; the Buyer and its advisors, if
any, have been afforded the opportunity to ask questions of the Company and have
received satisfactory answers to any such inquiries; without limiting the
generality of the foregoing, the Buyer has had the opportunity to obtain and to
review the Company's (1) Annual Report on Form 10-K for the fiscal year ended
June 30, 1999 (the "1999 10-K"), (2) Quarterly Report on Form 10-Q for the
fiscal quarter ended September 30, 1999, and (3) definitive proxy statement for
the Company's 1999 Annual Meeting of Shareholders to be held on December 10,
1999, in each case as filed with the SEC (collectively, the "SEC Reports"); and
the Buyer understands that its investment in the Shares involves a high degree
of risk;
(f) Absence of Approvals. The Buyer understands that no United
States federal or state agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Shares; and
(g) Subscription Agreement. This Agreement has been duly and
validly authorized, executed and delivered on behalf of the Buyer and is a valid
and binding agreement of the Buyer enforceable in accordance with its terms,
subject as to enforceability to general principles of equity and to bankruptcy,
insolvency, moratorium and other similar laws affecting the enforcement of
creditors' rights generally.
3. COMPANY REPRESENTATIONS, WARRANTIES, ETC.
The Company represents and warrants to, and covenants and agrees
with, the Buyer that:
(a) Organization and Authority. The Company is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all requisite corporate power and
authority to (i) own, lease and operate its properties and to carry on its
business as now being conducted, and (ii) to execute, deliver and perform its
obligations under this Agreement, the Certificate of Designations, the Warrants,
the Registration Rights Agreement, the form of which is attached hereto as Annex
IV (the "Registration Rights Agreement"), the Transfer Agent Agreement, the form
of which is attached hereto as Annex V (the "Transfer Agent Agreement"), and the
other agreements to be executed and delivered by the Company in connection
herewith, and to consummate the transactions contemplated hereby and thereby.
The Company is duly qualified to do business as a foreign corporation and is in
good standing in all jurisdictions wherein such qualification is necessary and
where failure so to qualify could have a material adverse effect on the
business, properties, operations, condition (financial or other), results of
operations or prospects of the Company. All subsidiaries and persons in which
the Company has an equity investment are disclosed on Schedule 3(a) to this
Agreement and, except as disclosed on Schedule 3(a), have no assets, operations
or liabilities, including, without limitation, indirect, contingent,
environmental or litigation-related liabilities.
(b) Capitalization. The authorized capital stock of the Company
consists of (1) 50,000,000 shares of Common Stock of which 21,188,262 shares
were outstanding on December 17, 1999, all of which are fully paid and
nonassessable; and (2) 2,000,000 shares of Preferred Stock, $.001 par value, of
which (A) 1,200,000 shares are designated as Series A Convertible Preferred
Stock (the "Series A Preferred Stock"), of which 770,000 shares are issued and
outstanding, and (B) 4,080 shares will be designated as Series B Convertible
Preferred Stock of which 4,000 shares will be issued pursuant to this Agreement
and the other subscription agreement for the purchase of shares of Preferred
Stock and the acquisition of common stock purchase warrants being entered into
in connection herewith (the "Other Subscription Agreement"); and on the Closing
Date there will be (x) no material increase from December 17, 1999 in the number
of shares of Common Stock outstanding and (y) no issuances of preferred stock
except as issued pursuant to this Agreement and the Other Subscription
Agreement. As of December 17, 1999, the Company had outstanding Series A
Preferred Stock, options, warrants and similar rights entitling the holders to
purchase an aggregate of 9,760,429 shares of Common Stock. Other than as set
forth in the preceding sentence, the Company does not have outstanding any
material amount of securities (or obligations to issue any such securities)
convertible into, exchangeable for or otherwise entitling the holders thereof to
acquire shares of Common Stock, except as disclosed in the SEC Reports. The
Company has duly reserved from its authorized and unissued shares of Common
Stock the full number of shares required for (a) all options, warrants,
convertible securities and other rights to acquire shares of Common Stock which
are outstanding and (b) all shares of Common Stock and options and other rights
to acquire shares of Common Stock which may be issued or granted under the stock
option and similar plans which have been adopted by the Company. Each
outstanding class or series of securities for which any antidilution or similar
adjustment arising by reason of the issuance or conversion of the Preferred
Shares or the issuance or exercise of the Warrants or the issuance or conversion
of the shares of Preferred Stock and the issuance or exercise of the warrants to
be issued pursuant to the Other Subscription Agreement will occur is identified
on Schedule 3(b) to this Agreement, together with the amount of such
antidilution adjustment. The outstanding shares of Common Stock and Series A
Preferred Stock and outstanding options, warrants and other securities
convertible into, exchangeable for or otherwise entitling the holder thereof to
acquire shares of Common Stock have been duly authorized and validly issued.
None of such outstanding shares of Common Stock, Series A Preferred Stock,
options, warrants and other securities has been issued in violation of the
preemptive rights of any securityholder of the Company. The offers and sales of
the outstanding shares of Common Stock, Series A Preferred Stock, and such
options, warrants and other securities were at all relevant times either
registered under the 1933 Act and applicable state securities laws or exempt
from such requirements. No holder of any of the Company's securities has any
rights, "demand," "piggy-back" or otherwise, to have such securities registered
by reason of the intention to file, filing or effectiveness of the Registration
Statement (as defined in the Registration Rights Agreement).
(c) Concerning the Shares and the Common Stock. The Shares have
been duly authorized. The Preferred Shares, when issued and paid for in
accordance with this Agreement, and the Common Shares, when issued upon
conversion of the Preferred Shares in accordance with the Certificate of
Designations or upon exercise of the Warrants in accordance with the terms of
the Warrants, as the case may be, will be duly and validly issued, fully paid
and non-assessable and will not subject the holder thereof to personal liability
by reason of being such holder. Except as disclosed on Schedule 3(c)-1 to this
Agreement, there are no preemptive or similar rights of any stockholder of the
Company or any other person to acquire any of the Shares or the Warrants. The
Company has duly reserved 4,236,000 shares of Common Stock for conversion of the
shares of Preferred Stock and exercise of the Warrants and the warrants issuable
in connection with the Other Subscription Agreement, and such shares shall
remain so reserved (subject to reduction from time to time for shares of Common
Stock issued upon conversion of shares of Preferred Stock or redemption or other
permitted retirement of shares of Preferred Stock), and the Company shall from
time to time reserve such additional shares of Common Stock as shall be required
to be reserved pursuant to the Certificate of Designations, as long as the
Preferred Stock is convertible, and pursuant to the Warrants, as long as the
Warrants are exercisable. The Common Stock is listed for trading on Nasdaq and
(1) the Company and the Common Stock meet the criteria for continued listing and
trading on Nasdaq; (2) except as disclosed on Schedule 3(c)-2 to this Agreement,
the Company has not been notified since January 1, 1997 by Nasdaq of any failure
or potential failure to meet the criteria for continued listing and trading on
Nasdaq and (3) no suspension of trading in the Common Stock is in effect. The
Company knows of no reason that the Common Shares will not be eligible for
listing on Nasdaq.
(d) Subscription Agreement and Other Transaction Documents. This
Agreement, the Certificate of Designations, the Registration Rights Agreement,
the Warrants and the Transfer Agent Agreement and the other agreements and
instruments contemplated hereby and thereby have been duly and validly
authorized by the Company, this Agreement has been duly executed and delivered
by the Company and this Agreement is, and the Registration Rights Agreement, the
Warrants and the Transfer Agent Agreement and such other agreements, when
executed and delivered by the Company, will be, valid and binding obligations of
the Company enforceable in accordance with their respective terms, subject as to
enforceability to general principles of equity and to bankruptcy, insolvency,
moratorium and other similar laws affecting the enforcement of creditors' rights
generally.
(e) Non-contravention. The execution and delivery by the Company
of this Agreement and the other documents contemplated by this Agreement and the
consummation by the Company of the issuance of the Preferred Shares and the
Warrants as contemplated by this Agreement, and the other transactions
contemplated by this Agreement, the Certificate of Designations, the
Registration Rights Agreement, the Warrants and the Transfer Agent Agreement do
not and will not, with or without the giving of notice or the lapse of time, or
both (i) result in any violation of any terms of the Articles of Incorporation,
as amended, or By-laws of the Company , (ii) conflict with or result in a breach
by the Company of any of the terms or provisions of, or constitute a default
under, or result in the modification, amendment, termination or cancellation of,
result in the acceleration of any obligation of the Company under, or result in
the creation or imposition of any lien, security interest, charge or encumbrance
upon any of the properties or assets of the Company pursuant to, any indenture,
mortgage, deed of trust or other agreement or instrument to which the Company is
a party or by which the Company or any of its properties or assets is bound or
affected, (iii) violate or contravene any applicable law, rule or regulation or
any applicable decree, judgment or order of any court, United States federal or
state regulatory body, administrative agency or other governmental body having
jurisdiction over the Company or any of its properties or assets or (iv) have
any material adverse effect on any permit, certification, registration,
approval, consent, license or franchise necessary for the Company to own or
lease and operate any of its properties or to conduct any of its business or the
ability of the Company to make use thereof.
(f) Approvals. No authorization, approval or consent of, or
filing with, any court, governmental body, regulatory agency, self-regulatory
organization, or stock exchange or market or the stockholders of the Company is
required to be obtained or made by the Company for (1) the execution, delivery
and performance by the Company of this Agreement, the Registration Rights
Agreement, the Warrants, the Transfer Agent Agreement and the other agreements
and instruments contemplated hereby and thereby, (2) the execution, filing and
performance by the Company of the Certificate of Designations, (3) the issuance
and sale of the Preferred Shares and the issuance of the Warrants as
contemplated by this Agreement and (4) the issuance of Common Shares on
conversion of the Preferred Shares or upon the exercise of the Warrants, other
than (u) the filing with the SEC after the Closing Date of a Current Report on
Form 8-K with respect to the transactions contemplated by this Agreement, (v)
the filing of the notification for listing of additional shares with the Nasdaq
pursuant to Section 4(e), (w) the filing of the Certificate of Designations with
the Secretary of State of the State of Delaware, (x) registration of the resale
of the Common Shares under the 1933 Act as contemplated by the Registration
Rights Agreement, (y) as may be required under applicable state securities or
"blue sky" laws and (z) filing of one or more Forms D with respect to the
Securities as required under Regulation D.
(g) Information Provided. The information provided by or on
behalf of the Company to the Buyer in connection with the transactions
contemplated by this Agreement, including, without limitation, the information
referred to in Section 2(e) of this Agreement, does not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they are made, not misleading, it being understood that, for purposes of
this Section 3(g), any statement contained in such information shall be deemed
to be modified or superseded for purposes of this Section 3(g) to the extent
that a statement in any document included in such information which was prepared
or filed with the SEC on a later date modifies or replaces such statement,
whether or not such later prepared or filed statement so states. The Company has
not filed any reports with the SEC under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), since June 30, 1999 other than the SEC Reports.
(h) Absence of Certain Changes. Since June 30, 1999, there has
been no material adverse change and no material adverse development in the
business, properties, operations, condition (financial or other), results of
operations or prospects of the Company, except as disclosed in the SEC Reports.
Except as and to the extent disclosed, reflected or reserved against in the
financial statements of the Company and the notes thereto included in the SEC
Reports, the Company has no material (individually or in the aggregate)
liabilities, debts or obligations whether accrued, absolute, contingent or
otherwise, and whether due or to become due. Subsequent to June 30, 1999, the
Company has not incurred any liabilities, debts or obligations of any nature
whatsoever which are individually or in the aggregate material to the Company,
other than those incurred in the ordinary course of its business or disclosed in
the SEC Reports.
(i) Absence of Certain Proceedings. Except as disclosed in the
SEC Reports, there is no action, suit, proceeding, inquiry or investigation
before or by any court, arbitrator, public board or body or governmental agency
(collectively, an "Action") pending or, to the knowledge of the Company,
threatened against the Company, in any such case wherein an unfavorable
decision, ruling or finding would have a material adverse effect on business,
properties, operations, condition (financial or other), results of operations or
prospects of the Company or the transactions contemplated by this Agreement or
any of the documents contemplated hereby or which would adversely affect the
validity or enforceability of, or the authority or ability of the Company to
perform its obligations under, this Agreement or any of such other documents;
except as disclosed on Schedule 3(i) to this Agreement, neither the Company nor
any director or officer thereof is or has been the subject of any Action
involving a claim of violation of or liability under federal or state securities
laws or a claim of breach of fiduciary duty; except as disclosed on Schedule
3(i) to this Agreement, the Company does not have pending before the SEC any
request for confidential treatment of information and to the best of the
Company's knowledge no such request will be made by the Company prior to the
time the Registration Statement relating to the Common Shares which is
contemplated by the Registration Rights Agreement is first ordered effective by
the SEC; and there has not been, and to the best of the Company's knowledge
there is not pending or contemplated, any investigation by the SEC involving the
Company or any current or former director or officer of the Company.
(j) Properties. The Company has good title to or leasehold
interests in all property real and personal (tangible and intangible) and other
assets owned by them, free and clear of all security interests, charges,
mortgages, liens or other encumbrances, except with respect to capital lease
obligations and protective filings by lessors and except such as are described
in the SEC Reports or such as do not materially interfere with the use of such
property made, or proposed to be made, by the Company. The leases, licenses or
other contracts or instruments under which the Company leases, holds or is
entitled to use any property, real or personal, are valid, subsisting and
enforceable with only such exceptions as do not materially interfere with the
use of such property made, or proposed to be made, by the Company. The Company
has not received notice of any material violation of any applicable law,
ordinance, regulation, order or requirement relating to its owned or leased
properties. The Company does not have any knowledge of, and the Company has not
given or received any notice of, any pending conflicts with or infringement of
the rights of others with respect to any Company Proprietary Rights (as defined
herein) or with respect to any license of Company Proprietary Rights. No action,
suit, arbitration, or legal, administrative or other proceeding or investigation
is pending, or, to the best knowledge of the Company, threatened, which involves
any Company Proprietary Rights. The Company is not subject to any judgment,
order, writ, injunction or decree of any court or any federal, state, local,
foreign or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, or any arbitrator, or has entered into or
is a party to any contract which restricts or impairs the use of any such
Company Proprietary Rights in a manner which would have a material adverse
effect on the use by the Company of any of the Company Proprietary Rights. To
the best knowledge of the Company, no Company Proprietary Rights and no services
or products sold by the Company conflict with or infringe upon any proprietary
rights available to any third party. The Company has not received written notice
of any pending conflict with or infringement upon such third-party proprietary
rights. The Company has not entered into any consent, indemnification,
forbearance to ▇▇▇ or settlement agreement with respect to Company Proprietary
Rights other than in the ordinary course of business. No claims have been
asserted by any person with respect to the validity of the Company's ownership
or right to use the Company Proprietary Rights and, to the best knowledge of the
Company, there is no reasonable basis for any such claim to be successful. To
the best knowledge of the Company, the Company Proprietary Rights are valid and
enforceable. No registration relating to the Company Proprietary Rights has
lapsed, expired or been abandoned or canceled or is the subject of cancellation
or other adversarial proceedings, and all applications therefor are pending and
are in good standing, except for such lapses, expirations, abandonments,
cancellations, adversarial proceedings or failures to be in good standing which
would not, singly or in the aggregate, have a material adverse effect on the
business, properties, operations, condition (financial or other), results of
operations or prospects of the Company. The Company has complied, in all
material respects, with its respective contractual obligations relating to the
protection of the Company Proprietary Rights used pursuant to licenses. To the
best knowledge of the Company, no person is infringing on or violating the
Company Proprietary Rights. As used herein, the term "Company Proprietary
Rights" means all patents, patent applications, inventions, trademarks, trade
names, applications for registration of trademarks, service marks, service ▇▇▇▇
applications, domain names, copyrights, know-how, manufacturing processes,
formulae, trade secrets, licenses and rights in any thereof and any other
intangible property and assets which are material to the business of the Company
as now conducted, as proposed to be conducted or as described in this Agreement.
(k) Labor Relations. Except as disclosed in the SEC Reports, no
material labor problem exists or, to the knowledge of the Company, is imminent
with respect to any of the employees of the Company.
(l) SEC Filings. The Company has timely filed all required forms,
reports and other documents required to be filed by the Company with the SEC
under the 1934 Act. All of such forms, reports and other documents complied,
when filed, in all material respects, with all applicable requirements of the
1933 Act and the 1934 Act.
(m) Absence of Brokers, Finders, Etc. No broker, finder or
similar person is entitled to any commission, fee or other compensation by
reason of the transactions contemplated by this Agreement other than Reedland
Capital Partners, a Division of Financial West Group, and the Company shall pay,
and indemnify and hold harmless the Buyer from, any claim made against the Buyer
by such entity or any other person for any such commission, fee or other
compensation.
(n) No Solicitation. No form of general solicitation or general
advertising was used by the Company or, to the best of its knowledge, any other
person acting on behalf of the Company, in respect of or in connection with the
offer and sale of the Securities. Except as disclosed on Schedule 3(n) to this
Agreement, neither the Company nor, to its knowledge, any person acting on
behalf of the Company has, either directly or indirectly, sold or offered for
sale to any person any of the Preferred Shares or the Warrants or, within the
six months prior to the date hereof, any other similar security of the Company
except as contemplated by this Agreement and the Other Subscription Agreement;
and neither the Company nor any person authorized to act on its behalf will sell
or offer for sale any shares of Preferred Stock or shares of Common Stock or
Warrants, or solicit any offers to buy any shares of Preferred Stock or shares
of Common Stock or Warrants, so as thereby to cause the issuance or sale of any
of the Shares or the issuance of the Warrants to be in violation of Section 5 of
the ▇▇▇▇ ▇▇▇.
(o) Certain Issuances of Securities. The Company has not issued
any shares of Common Stock or shares of any series of preferred stock or other
securities convertible into, exchangeable for or otherwise entitling the holder
to acquire shares of Common Stock which are subject to Rule 4310(c)(25)(H) of
the Nasdaq as in effect from time to time or any successor, replacement or
similar provision thereof or of any other market on which the Common Stock is
listed for trading (the "Stockholder Approval Rule") and which would be
integrated with the sale of the Preferred Shares to the Buyer or the issuance of
Common Shares upon conversion thereof or upon exercise of the Warrants for
purposes of the Stockholder Approval Rule.
(p) Absence of Rights Agreement. The Company has not adopted a
shareholder rights plan or similar arrangement relating to accumulations of
beneficial ownership of Common Stock or a change in control of the Company.
4. CERTAIN COVENANTS AND ACKNOWLEDGMENTS.
(a) Transfer Restrictions. The Company and the Buyer acknowledge
and agree that (1) the Preferred Shares and the Warrants have not been and are
not being registered under the provisions of the 1933 Act and, except as
provided in the Registration Rights Agreement with respect to the resale of the
Common Shares, the Common Shares have not been and are not being registered for
resale under the 1933 Act, and the Securities may not be transferred unless (A)
subsequently registered for resale thereunder or (B) the Buyer shall have
delivered to the Company an opinion of counsel, reasonably satisfactory in form,
scope and substance to the Company, to the effect that the Securities to be sold
or transferred may be sold or transferred pursuant to an exemption from such
registration; (2) any resale of the Securities made in reliance on Rule 144
promulgated under the 1933 Act may be made only in accordance with the terms of
said Rule and further, if said Rule is not applicable, any such resale of
Securities under circumstances in which the seller, or the person through whom
the sale is made, may be deemed to be an underwriter, as that term is used in
the 1933 Act, may require compliance with some other exemption under the 1933
Act or the rules and regulations of the SEC thereunder; and (3) neither the
Company nor any other person is under any obligation to register the Securities
(other than pursuant to the Registration Rights Agreement) under the 1933 Act or
to comply with the terms and conditions of any exemption thereunder (other than
pursuant to Section 4(d) hereof and pursuant to the Registration Rights
Agreement). Any transfer of the Preferred Shares or the Warrants shall be made
in compliance with Section 9(h).
(b) Restrictive Legend. (1) The Buyer acknowledges and agrees
that the Preferred Shares shall bear a restrictive legend in substantially the
following form (and a stop-transfer order may be placed against transfer of the
Preferred Shares):
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended. The securities have been
acquired for investment and may not be sold, transferred or assigned in
the absence of an effective registration statement for the securities
under the Securities Act of 1933, as amended, or an opinion of counsel
that registration is not required under said Act.
The number of shares constituting the portion of the Maximum Share
Amount, as defined in the Certificate of Designations of the Series B
Convertible Preferred Stock (the "Certificate of Designations"),
allocated to the shares represented by this certificate for purposes of
conversion thereof is 1,588,500.
Section 10(b)(3)(a) of the Certificate of Designations permits a holder
of the securities represented by this certificate to convert such
securities in accordance with the Certificate of Designations without
being required to surrender this certificate to the Company unless all
of the securities represented hereby are so converted. Consequently,
following conversion of any of the securities represented by this
certificate, the number of shares represented by this certificate may be
less than the number of shares stated hereon. Upon request of any
proposed transferee of this certificate, the Company will provide
confirmation of the number of shares evidenced by this certificate.
(2) The Buyer further acknowledges and agrees that the Warrants
shall bear a restrictive legend in substantially the following form (and a
stop-transfer order may be placed against transfer of the Warrants):
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended. The securities have been
acquired for investment and may not be resold, transferred or assigned
in the absence of an effective registration statement for the securities
under the Securities Act of 1933, as amended, or an opinion of counsel
that registration is not required under said Act.
(3) The Buyer further acknowledges and agrees that until such
time as the Common Shares have been registered for resale under the 1933 Act as
contemplated by the Registration Rights Agreement, the certificates for the
Common Shares may bear a restrictive legend in substantially the following form
(and a stop-transfer order may be placed against transfer of the certificates
for the Common Shares):
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended. The securities have been
acquired for investment and may not be resold, transferred or assigned
in the absence of an effective registration statement for the securities
under the Securities Act of 1933, as amended, or an opinion of counsel
that registration is not required under said Act.
(4) Once the Registration Statement required to be filed by the
Company pursuant to Section 2 of the Registration Rights Agreement has been
declared effective, thereafter (1) upon request of the Buyer the Company will
substitute certificates without restrictive legend for certificates for any
Common Shares issued prior to the date such Registration Statement is declared
effective by the SEC which bear such restrictive legend and remove any
stop-transfer restriction relating thereto promptly, but in no event later than
three Trading Days (as defined in the Certificate of Designations) after
surrender of such certificates by the Buyer and (2) the Company shall not place
any restrictive legend on certificates for Common Shares issued on conversion of
the Preferred Shares or upon exercise of the Warrants or impose any
stop-transfer restriction thereon.
(c) Registration Rights Agreement. The parties hereto agree to
enter into the Registration Rights Agreement in the form attached hereto as
Annex IV on or before the Closing Date.
(d) Form D. The Company agrees to file a Form D with respect to
the Securities as required under Regulation D and to provide a copy thereof to
the Buyer promptly after such filing. The Buyer agrees to cooperate with the
Company in connection with such filing and, upon request of the Company, to
provide all information relating to the Buyer reasonably required for such
filing.
(e) Authorization for Trading; Reporting Status. On or before the
Closing Date, the Company shall file a notification for listing of additional
shares with the Nasdaq relating to the Common Shares and shall provide evidence
of such filing to the Buyer. So long as the Buyer beneficially owns any of the
Preferred Shares, the Warrants or the Common Shares, the Company shall file all
reports required to be filed with the SEC pursuant to Section 13 or 15(d) of the
1934 Act and the Company shall not terminate its status as an issuer required to
file reports under the 1934 Act even if the 1934 Act or the rules and
regulations thereunder would permit such termination.
(f) Use of Proceeds. The Company does not own or have any present
intention of acquiring any "margin stock" as defined in Regulation G (12 CFR
Part 207) of the Board of Governors of the Federal Reserve System ("margin
stock"). The proceeds of sale of the Preferred Shares will be used for general
working capital purposes and in the operation of the Company's business. None of
such proceeds will be used, directly or indirectly (1) to make any loan to or
investment in any other person (other than financing the Company's subsidiaries
in the ordinary course of business or in connection with an acquisition of
another corporation or business or assets of another corporation or business) or
(2) for the purpose, whether immediate, incidental or ultimate, of purchasing or
carrying any margin stock or for the purpose of maintaining, reducing or
retiring any indebtedness which was originally incurred to purchase or carry any
stock that is currently a margin stock or for any other purpose which might
constitute the transactions contemplated by this Agreement a "purpose credit"
within the meaning of such Regulation G. Neither the Company nor any agent
acting on its behalf has taken or will take any action which might cause this
Agreement or the transactions contemplated hereby to violate Regulation G,
Regulation T or any other regulation of the Board of Governors of the Federal
Reserve System or to violate the 1934 Act, in each case as in effect now or as
the same may hereafter be in effect.
(g) Blue Sky Laws. On or before the Closing Date, the Company
shall take such action as shall be necessary to qualify, or to obtain an
exemption for, the Preferred Shares for sale to the Buyer and the Warrants for
issuance to the Buyer pursuant to this Agreement and the Common Shares for
issuance to the Buyer on conversion of the Preferred Shares and exercise of the
Warrants under such of the securities or "blue sky" laws of jurisdictions as
shall be applicable to the sale of the Preferred Shares and the issuance of the
Warrants pursuant to this Agreement and the issuance to the Buyer of Common
Shares on conversion of the Preferred Shares and exercise of the Warrants. The
Company shall furnish copies of all filings, applications, orders and grants or
confirmations of exemptions relating to such securities or "blue sky" laws on or
prior to the Closing Date.
(h) Certain Expenses. At the closing on the Closing Date, the
Company shall pay or reimburse the Buyer for all reasonable expenses (including,
without limitation, legal fees and expenses of counsel to the Buyer and the
Buyer's due diligence expenses) not in excess of $25,000 incurred by the Buyer
in connection with this Agreement and the transactions contemplated hereby. In
addition, the Company shall pay on demand all expenses incurred by the Buyer,
including reasonable attorneys' fees and expenses, as a consequence of, or in
connection with (1) the negotiation, preparation or execution of any amendment,
modification or waiver of this Agreement, the Certificate of Designations, the
Registration Rights Agreement, the Warrants, the Transfer Agent Agreement and
the other agreements and instruments contemplated hereby and thereby requested
by the Company, (2) any default or breach of any of the Company's obligations
set forth in any of such agreements or instruments and (3) the enforcement or
restructuring of any right of, including the collection of any payments due, the
Buyer under any of such agreements or instruments, including any action or
proceeding relating to such enforcement, or any order, injunction or other
process seeking to restrain the Company from paying any amount due the Buyer, in
which the Buyer prevails.
(i) Certain Issuances of Securities. (1) Unless the Company
obtains the Stockholder Approval (as defined in the Certificate of Designations)
or a waiver thereof from the Nasdaq, the Company will not issue any shares of
Common Stock or shares of any other series of preferred stock or other
securities convertible into, exchangeable for, or otherwise entitling the holder
to acquire, shares of Common Stock which would be subject to the requirements of
the Stockholder Approval Rule and which would be integrated with the sale of the
Preferred Shares and issuance of the Warrants to the Buyer or the issuance of
Common Shares upon conversion of the Preferred Shares or upon exercise of the
Warrants for purposes of the Stockholder Approval Rule.
(2) During the period from the date of this Agreement to the
later of (i) the date which is one year after the Closing Date and (ii) the date
on which the Registration Statement shall have been effective with the SEC for
270 consecutive days, the Company shall not offer, sell, contract to sell or
issue (or engage any person to assist the Company in taking any such action) (A)
any security (whether debt or equity) with conversion or exchange terms similar
in nature to the conversion rights of the Preferred Stock or (B) any equity
securities or securities convertible into, exchangeable for or otherwise
entitling the holder to acquire, any Common Stock at a price below the market
price of the Common Stock on the date of such issuance or the date of
conversion, exchange or other exercise thereof (or below an average market price
for a reasonable period prior to such issuance, conversion, exchange or other
exercise) (collectively, "Equity Securities"); provided, however, that nothing
in this Section 4(i)(2) shall prohibit the Company from issuing securities (w)
pursuant to compensation plans for employees, directors, officers, advisers or
consultants of the Company and in accordance with the terms of such plans as in
effect as of the date of this Agreement, (x) upon exercise of conversion,
exchange, purchase or similar rights issued, granted or given by the Company and
outstanding as of the date of this Agreement and disclosed in the SEC Reports or
this Agreement, (y) pursuant to a public offering underwritten on a firm
commitment basis registered under the 1933 Act or (z) as part of a transaction
involving a strategic alliance, acquisition of stock or assets, merger,
collaboration, joint venture, partnership or other similar arrangement of the
Company with another corporation, partnership or other business entity which is
engaged in a business similar to or related to the business of the Company, so
long as in the case of this clause (z) the Board of Directors by resolution duly
adopted (and a copy of which shall be furnished to the Buyer promptly after
adoption) determines that such issuance is fair to the holders of each class and
series of capital stock of the Company and to the Buyer in respect of its equity
interest in the Company that is represented by the Preferred Shares and the
Warrants.
(3) Subject to the restrictions in Sections 4(i)(1) and 4(i)(2),
during the period from the date of execution and delivery of this Agreement to
the date which is one year after the Closing Date, the Company shall not offer,
sell, contract to sell or issue (or engage any person to assist the Company in
taking any such action) any Equity Securities without giving the Buyer the first
right to acquire the Equity Securities on the same terms as the Equity
Securities are to be offered to other investors; provided, however, that this
Section 4(i)(3) shall not apply to the offer or sale of Equity Securities by the
Company in the transactions, and subject to the conditions, set forth in clauses
(w), (x), (y) and (z) of the proviso to the first sentence of Section 4(i)(2)
above. The Company shall give notice to the Buyer of the detailed terms of the
Equity Securities proposed to be issued and, promptly after being requested by
the Buyer, such other information as requested by the Buyer. The Buyer may, by
notice to the Company, exercise such right of first refusal at any time until
the later of (x) 30 Business Days after such notice from the Company to the
Buyer and (y) 15 Business Days after the Company provides such additional
information as shall have been requested by the Buyer; provided, however, that
if the Company has theretofore complied in good faith with any such request for
additional information, the Buyer must exercise such right not later than 45
Business Days after such notice from the Company to the Buyer.
(j) Certain Selling Restrictions. So long as the Company is in
compliance in all material respects with its obligations to the Buyer under this
Agreement, the Certificate of Designations, the Warrants and the Registration
Rights Agreement, during the 20 consecutive Trading Days (as defined in the
Certificate of Designations) immediately preceding the Initial Reset Date (as
defined in the Certificate of Designations) and each Biannual Reset Date (as
defined in the Certificate of Designations), the Buyer agrees on its behalf and
on behalf of its Affiliates (as defined in the Certificate of Designations) that
it will not sell, or engage in any short sales with respect to, any shares of
Common Stock on Nasdaq or any other securities market where the Common Stock is
then listed for trading.
(k) Best Efforts. Each of the parties shall use its best efforts
timely to satisfy each of the conditions to the other party's obligations to
sell and purchase the Preferred Shares set forth in Section 7 or 8, as the case
may be, of this Agreement on or before the Closing Date.
5. TRANSFER AGENT AGREEMENT; CONVERSION PROCEDURE.
(a) Transfer Agent Agreement. Prior to the Closing Date, the
Company will (1) execute and deliver the Transfer Agent Agreement in the form
attached hereto as Annex V and thereby irrevocably instruct, American Securities
Transfer & Trust, Inc., as Transfer Agent and Registrar (the "Transfer Agent"),
to issue certificates for the Common Shares from time to time upon conversion of
the Preferred Shares and exercise of the Warrants in such amounts as specified
from time to time to the Transfer Agent in the Notices of Conversion surrendered
in connection with such conversions and referred to in Section 5(b) of this
Agreement and the Form of Subscription in the form attached to the Warrants and
(2) appoint the Transfer Agent the conversion agent for the Preferred Stock and
the exercise agent for the Warrants. The certificates for the Common Shares may
bear the restrictive legend specified in Section 4(b) of this Agreement prior to
registration of the resale of the Common Shares under the 1933 Act. The
certificates for the Common Shares shall be registered in the name of the Buyer
or its designee and in such denominations to be specified by the Buyer in
connection with each conversion of Preferred Shares or exercise of the Warrants.
The Company warrants that no instruction other than (x) such instructions
referred to in this Section 5, (y) stop transfer instructions to give effect to
Section 4(a) prior to registration of the resale of the Common Shares under the
1933 Act and (z) the instructions required by Section 3(n) of the Registration
Rights Agreement will be given by the Company to the Transfer Agent and that the
Common Shares shall otherwise be freely transferable on the books and records of
the Company as and to the extent provided in this Agreement. Nothing in this
Section 5(a) shall limit in any way the Buyer's obligations and agreement to
comply with the registration requirements of the 1933 Act upon resale of the
Common Shares. If the Buyer provides the Company with an opinion of counsel,
reasonably satisfactory in form, scope and substance to the Company and its
legal counsel, that registration of a resale by the Buyer of any of the
Securities is not required under the 1933 Act, the Company shall permit the
transfer of such Securities and, in the case of the Common Shares, in accordance
with clause (1)(B) of Section 4(a) of this Agreement, promptly instruct the
Transfer Agent to issue upon transfer one or more share certificates in such
name and in such denominations as specified by the Buyer within three Business
Days after receipt of such opinion. Nothing in this Section 5(a) shall limit the
obligations of the Company under Section 3(n) of the Registration Rights
Agreement.
(b) Conversion Procedure. In connection with the exercise of
conversion rights relating to the Preferred Shares, the Buyer or any subsequent
holder of the Preferred Shares shall complete, sign and furnish to the Transfer
Agent a Notice of Conversion of Series B Convertible Preferred Stock in the form
attached hereto as Annex VI (a "Conversion Notice") and shall provide a copy
thereof to the Company on the same day, which actions shall be deemed to satisfy
all requirements of the Certificate of Designations.
6. CLOSING DATE.
Subject to the satisfaction or waiver of the conditions set forth
in Sections 7 and 8, the date and time of the issuance and sale of the Preferred
Shares and the issuance of the Warrants (the "Closing Date") shall be 12:00
noon, New York City time, on or before the date which is three Business Days
after the date the Buyer has deposited the Purchase Price with the Escrow Agent
in accordance with Section 1(b), or such other mutually agreed to time. The
closing shall occur on the Closing Date at the Law Offices of ▇▇▇▇▇ ▇ ▇▇▇▇▇,
Penthouse Suite, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
7. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL AND ISSUE.
The Buyer understands that the Company's obligation to sell the
Preferred Shares and issue the Warrants to the Buyer pursuant to this Agreement
is conditioned upon the satisfaction of the following conditions precedent on or
before the Closing Date (any or all of which may be waived by the Company in its
sole discretion):
(a) The receipt and acceptance by the Company of this Agreement
as evidenced by execution of this Agreement by the Company and delivery of an
executed counterpart of this Agreement to the Buyer or its legal counsel;
(b) Delivery by the Buyer to the Escrow Agent of good funds as
payment in full of an amount equal to the Purchase Price for the Preferred
Shares in accordance with Section 1(b) hereof; and
(c) The accuracy on the Closing Date of the representations and
warranties of the Buyer contained in this Agreement as if made on the Closing
Date and the performance by the Buyer on or before the Closing Date of all
covenants and agreements of the Buyer required to be performed on or before the
Closing Date.
8. CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE.
The Company understands that the Buyer's obligation to purchase
the Preferred Shares and acquire the Warrants on the Closing Date is conditioned
upon the satisfaction of the following conditions precedent on or before the
Closing Date (any or all of which may be waived by the Buyer in its sole
discretion):
(a) Delivery by the Company to the Escrow Agent of the
certificates for the Preferred Shares and the Warrants in accordance with this
Agreement;
(b) The accuracy on the Closing Date of the representations and
warranties of the Company contained in this Agreement as if made on the Closing
Date and the performance by the Company on or before the Closing Date of all
covenants and agreements of the Company required to be performed on or before
the Closing Date, and receipt by the Buyer of a certificate, dated the Closing
Date, of the Chief Executive Officer of the Company confirming such matters and
such other matters as the Buyer may reasonably request;
(c) The receipt by the Buyer of confirmation of the filing with
the Secretary of State of the State of Delaware of the Certificate of
Designations;
(d) The receipt by the Buyer of a certificate, dated the Closing
Date, of the Secretary of the Company certifying (1) the Amended and Restated
Certificate of Incorporation and By-Laws of the Company as in effect on the
Closing Date and (2) all resolutions of the Board of Directors (and committees
thereof) of the Company relating to this Agreement and the transactions
contemplated hereby;
(e) The Transfer Agent shall have executed and delivered the
Transfer Agent Agreement in the form attached hereto as Annex V; and
(f) Receipt by the Buyer on the Closing Date of (i) an opinion of
▇▇▇▇▇▇ Eng Linn & ▇▇▇▇▇▇▇▇, counsel for the Company, dated the Closing Date, in
form, scope and substance reasonably satisfactory to the Buyer, to the effect
set forth in Annex VII attached hereto, and (ii) an opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇,
Esq., General Counsel of the Company, dated the Closing Date, in form, scope and
substance reasonably satisfactory to the Buyer, to the effect set forth in Annex
VIII attached hereto.
9. MISCELLANEOUS.
(a) Governing Law. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of California.
(b) Counterparts. This Agreement may be executed in counterparts
and by the parties hereto on separate counterparts, all of which together shall
constitute one and the same instrument. A facsimile transmission of this
Agreement bearing a signature on behalf of a party hereto shall be legal and
binding on such party. Although this Agreement is dated as of the date first set
forth above, the actual date of execution and delivery of this Agreement by each
party is the date set forth below such party's signature on the signature page
hereof. Any reference in this Agreement or in any of the documents executed and
delivered by the parties hereto in connection herewith to (1) the date of
execution and delivery of this Agreement by the Buyer shall be deemed a
reference to the date set forth below the Buyer's signature on the signature
page hereof, (2) the date of execution and delivery of this Agreement by the
Company shall be deemed a reference to the date set forth below the Company's
signature on the signature page hereof and (3) the date of execution and
delivery of this Agreement or the date of execution and delivery of this
Agreement by the Buyer and the Company shall be deemed a reference to the later
of the dates set forth below the signatures of the parties on the signature page
hereof.
(c) Headings, etc. The headings, captions and footers of this
Agreement are for convenience of reference and shall not form part of, or affect
the interpretation of, this Agreement.
(d) Severability. If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement or the validity or enforceability of this Agreement
in any other jurisdiction.
(e) Amendments. No amendment, modification, waiver, discharge or
termination of any provision of this Agreement nor consent to any departure by
the Buyer or the Company therefrom shall in any event be effective unless the
same shall be in writing and signed by the party to be charged with enforcement,
and then shall be effective only in the specific instance and for the purpose
for which given. No course of dealing between the parties hereto shall operate
as an amendment of this Agreement.
(f) Waivers. Failure of any party to exercise any right or remedy
under this Agreement or otherwise, or delay by a party in exercising such right
or remedy, or any course of dealings between the parties, shall not operate as a
waiver thereof or an amendment hereof, nor shall any single or partial exercise
of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
exercise of any other right or power.
(g) Notices. Any notices required or permitted to be given under
the terms of this Agreement shall be delivered personally (which shall include
telephone line facsimile transmission with answer back confirmation) or by
courier and shall be effective upon receipt, in the case of the Company
addressed to the Company at its address shown in the introductory paragraph of
this Agreement, Attention: Chief Executive Officer (telephone line facsimile
transmission number (▇▇▇) ▇▇▇-▇▇▇▇ or, in the case of the Buyer, at its address
or telephone line facsimile transmission number shown on the signature page of
this Agreement or such other address or telephone line facsimile transmission
number as a party shall have provided by notice to the other party in accordance
with this provision. The Buyer hereby designates as its address for any notice
required or permitted to be given to the Buyer pursuant to the Certificate of
Designations the address shown on the signature page of this Agreement, until
the Buyer shall designate another address for such purpose.
(h) Assignment. Prior to the Closing Date, the Buyer may not
assign its rights and obligations under this Agreement. Any transfer of the
Preferred Shares or the Warrants by the Buyer after the Closing Date shall be
made in accordance with Section 4(a) and, in connection with such transfer, the
Buyer shall assign to the transferee its rights and obligations under this
Agreement and the Registration Rights Agreement by compliance with the
provisions of Section 9 of the Registration Rights Agreement.
(i) Survival of Representations and Warranties. The respective
representations, warranties, covenants and agreements of the Buyer and the
Company contained in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall survive the delivery of and
payment for the Preferred Shares and shall remain in full force and effect
regardless of any investigation made by or on behalf of them or any person
controlling or advising any of them.
(j) Entire Agreement. This Agreement and its Schedules and
Annexes set forth the entire agreement between the parties hereto with respect
to the subject matter hereof and supersede all prior agreements and
understandings, whether written or oral, with respect thereto.
(k) Termination. The Buyer shall have the right to terminate this
Agreement by giving notice to the Company at any time at or prior to the Closing
Date if:
(1) the Company shall have failed, refused, or been unable at or
prior to the date of such termination of this Agreement to perform any
of its obligations hereunder;
(2) any other condition of the Buyer's obligations hereunder is
not fulfilled; or
(3) the closing shall not have occurred on a Closing Date on or
before December 23, 1999, or such later date as the parties shall
mutually agree, other than solely by reason of a breach of this
Agreement by the Buyer.
Any such termination shall be effective upon the giving of notice thereof by the
Buyer. Upon such termination, the Buyer shall have no further obligation to the
Company hereunder and the Company shall remain liable for any breach of this
Agreement or the other documents contemplated hereby which occurred on or prior
to the date of such termination.
(l) Further Assurances. Each party to this Agreement will perform
any and all acts and execute any and all documents as may be necessary and
proper under the circumstances in order to accomplish the intents and purposes
of this Agreement and to carry out its provisions.
(m) Public Statements, Press Releases, Etc. The Company and the
Buyer shall have the right to approve before issuance any press releases or any
other public statements with respect to the transactions contemplated hereby;
provided, however, that the Company shall be entitled, without the prior
approval of the Buyer, to make any press release or other public disclosure with
respect to such transactions as is required by applicable law or Nasdaq
regulation (although the Buyer shall be consulted by the Company in connection
with any such press release or other public disclosure prior to its release and
shall be provided with a copy thereof).
(n) Construction. The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
Buyer and the Company by their respective officers or other representatives
thereunto duly authorized on the respective dates set forth below.
NUMBER OF SHARES: ________
PRICE PER SHARE: $______
AGGREGATE PURCHASE PRICE: $______
-------------------------------------
By:
Date:
Address: _______________________
Facsimile No.: _________________
THERMOGENESIS CORP.
Name:
Title:
Date:
