EXHIBIT 10.1
STOCK PURCHASE AGREEMENT
Vascular Solutions, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
The undersigned (the "INVESTOR") hereby confirms its agreement with you as
follows:
1. This Stock Purchase Agreement is made as of the date set forth below
between Vascular Solutions, Inc., a Minnesota corporation (the "COMPANY"), and
the Investor.
2. The Company has authorized the sale and issuance of up to 1,000,000 shares
(the "SHARES") of the common stock of the Company, $.01 par value per share (the
"COMMON STOCK"), to certain investors in a private placement (the "OFFERING").
3. The Company and the Investor agree that the Investor will purchase from the
Company and the Company will issue and sell to the Investor _______ Shares at a
purchase price of $6.75 per Share, or an aggregate purchase price of
$____________________ (the "PURCHASE PRICE"), subject to the Terms and
Conditions for Purchase of Shares attached hereto as Annex I and incorporated
herein by reference as if fully set forth herein. Unless otherwise requested by
the Investor in Exhibit A, certificates representing the Shares purchased by the
Investor will be registered in the Investor's name and address as set forth
below.
4. The Investor represents that, except as set forth below, (a) it has had no
position, office or other material relationship within the past three years with
the Company or its affiliates, (b) neither it, nor any group of which it is a
member or to which it is related, beneficially owns (including the right to
acquire or vote) any securities of the Company and (c) it has no direct or
indirect affiliation or association with any National Association of Securities
Dealers, Inc. ("NASD") member. Exceptions:
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(If no exceptions, write "none." If left blank,
response will be deemed to be "none.")
Please confirm that the foregoing correctly sets forth the agreement between us
by signing in the space provided below for that purpose.
DATED AS OF: March ___, 2004
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[INVESTOR NAME]
By:
---------------------------------
Name:
Title:
Address:
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AGREED AND ACCEPTED:
VASCULAR SOLUTIONS, INC.
By:
---------------------------------
Name: Xxxxxx X. Xxxx
Title: Chief Executive Officer
ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF SHARES
1. AGREEMENT TO SELL AND PURCHASE THE SHARES; SUBSCRIPTION DATE.
1.1 PURCHASE AND SALE. At the Closing (as defined in Section 2), the
Company will sell to the Investor, and the Investor will purchase from the
Company, upon the terms and subject to the conditions set forth herein, and at
the Purchase Price, the number of Shares described in paragraph 3 of the Stock
Purchase Agreement attached hereto (collectively with this Annex I and the other
exhibits attached hereto, this "AGREEMENT").
1.2 OTHER INVESTORS. As part of the Offering, the Company proposes to
enter into Stock Purchase Agreements in the same form as this Agreement with
certain other investors (the "OTHER INVESTORS"), and the Company expects to
complete sales of Shares to them. The Investor and the Other Investors are
sometimes collectively referred to herein as the "INVESTORS," and this Agreement
and the Stock Purchase Agreements executed by the Other Investors are sometimes
collectively referred to herein as the "AGREEMENTS." The Company may accept
executed Agreements from Investors for the purchase of Shares commencing upon
the date on which the Company provides the Investors with the proposed purchase
price per Share and concluding upon the date (the "SUBSCRIPTION DATE") on which
the Company has notified Xxxxxxxx Inc. and Xxxxxx Xxxxxxx Xxxxxxxx Xxxxxxx, Inc.
(in their capacity as placement agents for the Shares, the "PLACEMENT AGENTS")
in writing that it will no longer accept Agreements for the purchase of Shares
in the Offering, but in no event shall the Subscription Date be later than March
5, 2004. Each Investor must complete a Stock Purchase Agreement, a Stock
Certificate Questionnaire (in the form attached as Exhibit A hereto) and an
Investor Questionnaire (in the form attached as Exhibit B hereto) in order to
purchase Shares in the Offering.
1.3 PLACEMENT AGENTS FEE. The Investor acknowledges that the Company
intends to pay to the Placement Agents a fee in respect of the sale of Shares to
the Investor.
2. DELIVERY OF THE SHARES AT CLOSING. The completion of the purchase and
sale of the Shares (the "Closing") shall occur on a date specified by the
Company and Xxxxxxxx Inc. as representative of the Placement Agents (the
"CLOSING DATE"), which date shall not be later than March 11, 2004 (the "OUTSIDE
DATE"), and of which the Investors will be notified in advance by Xxxxxxxx Inc.
as representative of the Placement Agents. At the Closing, the Company shall
deliver to the Investor one or more stock certificates representing the number
of Shares set forth in paragraph 3 of the Stock Purchase Agreement, each such
certificate to be registered in the name of the Investor or, if so indicated on
the Stock Certificate Questionnaire attached hereto as Exhibit A, in the name of
a nominee designated by the Investor. In exchange for the delivery of the stock
certificates representing such Shares, the Investor shall deliver the Purchase
Price to the Company by wire transfer of immediately available funds pursuant to
the Company's written instructions. On the Closing Date, the Company shall cause
counsel to the Company to deliver to the Investors a legal opinion, dated the
Closing Date, substantially in the form attached hereto as Exhibit D (the "LEGAL
OPINION").
The Company's obligation to issue and sell the Shares to the Investor shall
be subject to the following conditions, any one or more of which may be waived
by the Company: (a) prior receipt by the Company of an executed copy of this
Agreement; (b) completion of purchases and sales of Shares under the Agreements
with the Other Investors; (c) the accuracy of the representations and warranties
made by the Investor in this Agreement and the fulfillment of the obligations of
the Investor to be fulfilled by it under this Agreement on or prior to the
Closing; and (d) the absence of any order, writ, injunction,
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judgment or decree that questions the validity of the Agreements or the right of
the Company or the Investor to enter into such Agreements or to consummate the
transactions contemplated hereby and thereby.
The Investor's obligation to purchase the Shares shall be subject to the
following conditions, any one or more of which may be waived by the Investor:
(a) the delivery of the Legal Opinion to the Investor by counsel to the Company;
(b) the accuracy of the representations and warranties made by the Company in
this Agreement on the date hereof and, if different, on the Closing Date; (c)
the fulfillment of the obligations of the Company to be fulfilled by it under
this Agreement on or prior to the Closing; (d) the absence of any order, writ,
injunction, judgment or decree that questions the validity of the Agreements or
the right of the Company or the Investor to enter into such Agreements or to
consummate the transactions contemplated hereby and thereby; and (e) the
delivery to the Investor by the Company of a certificate executed by the Chief
Executive Officer and the Director of Finance of the Company, dated the Closing
Date, stating that the conditions specified in this paragraph have been
fulfilled. In the event that the Closing does not occur on or before the Outside
Date as a result of the Company's failure to satisfy any of the conditions set
forth above (and such condition has not been waived by the Investor), the
Company shall return any and all funds paid hereunder to the Investor no later
than one Business Day following the Outside Date and the Investor shall have no
further obligations hereunder. For purposes of this Agreement, "BUSINESS DAY"
shall mean any day other than a Saturday, Sunday or other day on which the New
York Stock Exchange or commercial banks located in Minneapolis, Minnesota are
permitted or required by law to close.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY. Except as
otherwise described in the Company's Annual Report on Form 10-K for the year
ended December 31, 2003 (and any amendments thereto filed at least two (2)
Business Days prior to the date hereof), the Company's Proxy Statement for its
2003 Annual Meeting of Shareholders, or any of the Company's Current Reports on
Form 8-K filed since January 1, 2004 and at least two (2) Business Days prior to
the date hereof (collectively, the "SEC Reports"), the Company hereby represents
and warrants to, and covenants with, the Investor as of the date hereof and the
Closing Date, as follows:
3.1 ORGANIZATION. The Company is duly incorporated and validly
existing in good standing under the laws of the State of Minnesota. The Company
has full power and authority to own, operate and occupy its properties and to
conduct its business as presently conducted and is registered or qualified to do
business and in good standing in each jurisdiction in which it owns or leases
property or transacts business and where the failure to be so qualified would
have a material adverse effect upon the Company and its subsidiary as a whole or
the business, financial condition, properties, operations or assets of the
Company and its subsidiary as a whole or the Company's ability to perform its
obligations under the Agreements in all material respects ("MATERIAL ADVERSE
EFFECT"), and no proceeding has been instituted in any such jurisdiction
revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such
power and authority or qualification. The Company has no "subsidiaries" (as
defined in Rule 405 under the Securities Act of 1933, as amended (the
"SECURITIES ACT")), other than Vascular Solutions, GmbH, a German limited
liability corporation (the "SUBSIDIARY").
3.2 DUE AUTHORIZATION. The Company has all requisite power and
authority to execute, deliver and perform its obligations under the Agreements.
The execution and delivery of the Agreements, and the consummation by the
Company of the transactions contemplated hereby, have been duly authorized by
all necessary corporate action and no further action on the part of the Company
or its Board of Directors or shareholders is required. The Agreements have been
validly executed and delivered by the Company and constitute legal, valid and
binding agreements of the Company enforceable against the Company in accordance
with their terms, except to the extent (i) rights to indemnity and contribution
may be limited by state or federal securities laws or the public policy
underlying such laws, (ii) such
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enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and (iii) such enforceability may be subject to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
3.3 NON-CONTRAVENTION. The execution and delivery of the Agreements,
the issuance and sale of the Shares to be sold by the Company under the
Agreements, the fulfillment of the terms of the Agreements and the consummation
of the transactions contemplated thereby will not (A) result in a conflict with
or constitute a violation of, or default (with the passage of time or otherwise)
under, (i) any bond, debenture, note or other evidence of indebtedness, or any
material lease, contract, indenture, mortgage, deed of trust, loan agreement,
joint venture or other agreement or instrument to which the Company or the
Subsidiary is a party or by which the Company or the Subsidiary or their
respective properties are bound, (ii) the Articles of Incorporation, bylaws or
other organizational documents of the Company, as amended, or (iii) any law,
administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority binding upon the Company or the
Subsidiary or their respective properties or (B) result in the creation or
imposition of any lien, encumbrance, claim, security interest or restriction
whatsoever upon any of the material properties or assets of the Company or the
Subsidiary or an acceleration of indebtedness pursuant to any obligation,
agreement or condition contained in any material bond, debenture, note or any
other evidence of indebtedness or any material indenture, mortgage, deed of
trust or any other agreement or instrument to which the Company or the
Subsidiary is a party or by which it is bound or to which any of the property or
assets of the Company is subject. No consent, approval, authorization or other
order of, or registration, qualification or filing with, any regulatory body,
administrative agency, or other governmental body is required for the execution
and delivery of the Agreements by the Company and the valid issuance or sale of
the Shares by the Company pursuant to the Agreements, other than such as have
been made or obtained, and except for any filings required to be made under
federal or state securities laws.
3.4 CAPITALIZATION. The outstanding capital stock of the Company as
of December 31, 2003 is as described in the Company's Annual Report on Form 10-K
for the year ended December 31, 2003. The Company has not issued any capital
stock since December 31, 2003 other than pursuant to the purchase of shares
under the Company's employee stock purchase plan and the exercise of outstanding
warrants or stock options, in each case as disclosed in the SEC Reports. The
Shares to be sold pursuant to the Agreements have been duly authorized, and when
issued and paid for in accordance with the terms of the Agreements, will be duly
and validly issued, fully paid and nonassessable, subject to no lien, claim or
encumbrance (except for any such lien, claim or encumbrance created, directly or
indirectly, by the Investor). The outstanding shares of capital stock of the
Company have been duly and validly issued and are fully paid and nonassessable,
have been issued in compliance with the registration requirements of federal and
state securities laws, and were not issued in violation of any preemptive rights
or similar rights to subscribe for or purchase securities. The Company owns all
of the outstanding capital stock of the Subsidiary, free and clear of all liens,
claims and encumbrances. There are no outstanding rights (including, without
limitation, preemptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any unissued shares of capital stock or
other equity interest in the Company or the Subsidiary, or any contract,
commitment, agreement, understanding or arrangement of any kind to which the
Company or the Subsidiary is a party and providing for the issuance or sale of
any capital stock of the Company or of the Subsidiary, any such convertible or
exchangeable securities or any such rights, warrants or options. Without
limiting the foregoing, no preemptive right, co-sale right, registration right,
right of first refusal or other similar right exists with respect to the
issuance and sale of the Shares, except as provided in the Agreements. There are
no shareholders agreements, voting agreements or other similar agreements with
respect to the Common Stock to which the Company is a party.
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3.5 USE OF PROCEEDS. The Company will use the net proceeds to be
derived from the sale of the Shares for research and development, product
commercialization, potential product acquisitions, product development
opportunities, working capital and other general corporate purposes.
3.6 LEGAL PROCEEDINGS. There is no material legal or governmental
proceeding pending, or to the knowledge of the Company, threatened, to which the
Company or the Subsidiary is a party or of which the business or property of the
Company or the Subsidiary is subject that is required to be disclosed and that
is not so disclosed in the SEC Reports. Neither the Company nor the Subsidiary
is subject to any injunction, judgment, decree or order of any court, regulatory
body, administrative agency or other government body.
3.7 NO VIOLATIONS. Neither the Company nor the Subsidiary is in
violation of its Articles of Incorporation, bylaws or other organizational
documents, as amended, or in violation of any law, administrative regulation,
ordinance or order of any court or governmental agency, arbitration panel or
authority applicable to the Company, which violation, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect, and neither
the Company nor the Subsidiary is in default (and there exists no condition
which, with the passage of time or otherwise, would constitute a default) in the
performance of any bond, debenture, note or any other evidence of indebtedness
or any indenture, mortgage, deed of trust or any other material agreement or
instrument to which the Company or the Subsidiary is a party or by which the
Company or the Subsidiary or their respective properties are bound, which
default is reasonably likely to have a Material Adverse Effect.
3.8 PROPERTIES. The Company and the Subsidiary have good and
marketable title to all the properties and assets reflected as owned by them in
the consolidated financial statements included in the SEC Reports, subject to no
lien, mortgage, pledge, charge or encumbrance of any kind except (i) those, if
any, reflected in such consolidated financial statements or (ii) those which are
not material in amount and do not materially and adversely affect the use made
and intended to be made of such property by the Company or the Subsidiary. The
Company or the Subsidiary holds their leased properties under valid and binding
leases, with such exceptions as are not materially significant in relation to
the business of the Company and the Subsidiary, taken as a whole. Except as
disclosed in the SEC Reports, the Company owns or leases all such properties as
are necessary to its operations as now conducted.
3.9 GOVERNMENTAL PERMITS, ETC. Each of the Company and the Subsidiary
has all necessary franchises, licenses, certificates and other authorizations
from any foreign, federal, state or local government or governmental agency,
department or body that are currently necessary for the operation of the
business of the Company and the Subsidiary as currently conducted, except where
the failure to currently possess such franchises, licenses, certificates and
other authorizations is not reasonably likely to have a Material Adverse Effect.
Each of the Company and the Subsidiary are in compliance with the Federal Food,
Drug, and Cosmetic Act, as amended, and the regulations promulgated thereunder,
except where any failure to comply, individually and cumulatively, is not
reasonably likely to have a Material Adverse Effect.
3.10 INTELLECTUAL PROPERTY.
(a) Except for matters which are not reasonably likely to have a
Material Adverse Effect, (i) each of the Company and the Subsidiary has
ownership of, or a license or other legal right to use, all patents, patent
applications, PCT applications, copyrights, trade secrets, trademarks, customer
lists, designs, manufacturing or other processes, computer software, systems,
data compilation, research results or other proprietary rights used in the
business of the Company (collectively, "INTELLECTUAL PROPERTY") and (ii) all of
the Intellectual Property owned by the Company or by the Subsidiary consisting
of patents, patent applications, PCT applications, trademarks and copyrights
that
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have been duly registered in, filed in or issued by the United States Patent and
Trademark Office, the United States Register of Copyrights or the corresponding
offices of other jurisdictions have been maintained and renewed in accordance
with all applicable provisions of law and administrative regulations in the
United States and/or such other jurisdictions.
(b) Except for matters which are not reasonably likely to have a
Material Adverse Effect, all material licenses or other material agreements
under which (i) the Company or the Subsidiary employs rights in Intellectual
Property, or (ii) the Company or the Subsidiary has granted rights to others in
Intellectual Property owned or licensed by the Company or the Subsidiary are in
full force and effect, and there is no default by the Company with respect
thereto.
(c) The Company believes that it has taken all steps reasonably
required in accordance with sound business practice and business judgment to
establish and preserve the ownership of all material Intellectual Property owned
by the Company or the Subsidiary.
(d) Except for matters which are not reasonably likely to have a
Material Adverse Effect, to the knowledge of the Company, (i) the present
business, activities and products of the Company or the Subsidiary do not
infringe any intellectual property of any other person; (ii) neither the Company
nor the Subsidiary is making unauthorized use of any confidential information or
trade secrets of any person; and (iii) the activities of any of the employees of
the Company or the Subsidiary, acting on behalf of the Company or the
Subsidiary, do not violate any agreements or arrangements related to
confidential information or trade secrets of third parties.
(e) No proceedings are pending, or to the knowledge of the
Company, threatened, which challenge the rights of the Company or the Subsidiary
to the use of Intellectual Property, except for matters which are not reasonably
likely to have a Material Adverse Effect.
3.11 FINANCIAL STATEMENTS. The financial statements of the Company and
the related notes contained in the SEC Reports present fairly and accurately in
all material respects the financial position of the Company as of the dates
therein indicated, and the results of its operations, cash flows and the changes
in shareholders' equity for the periods therein specified, subject, in the case
of unaudited financial statements for interim periods, to normal year-end audit
adjustments. Such financial statements (including the related notes) have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis at the times and throughout the periods therein specified,
except that unaudited financial statements may not contain all footnotes
required by generally accepted accounting principles.
3.12 NO MATERIAL ADVERSE CHANGE. Except as disclosed in the SEC
Reports or in any press release issued by the Company at least two (2) Business
Days prior to the date of this Agreement, since December 31, 2003, there has not
been (i) an event, circumstance or change that has had or is reasonably likely
to have a Material Adverse Effect, (ii) any obligation incurred by the Company
or the Subsidiary, direct or contingent, that is material to the Company, (iii)
any dividend or distribution of any kind declared, paid or made on the capital
stock of the Company, or (iv) any loss or damage (whether or not insured) to the
physical property of the Company or the Subsidiary which has had a Material
Adverse Effect.
3.13 NASDAQ COMPLIANCE. The Company's Common Stock is registered
pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended
(the "EXCHANGE ACT"), and is listed on the Nasdaq National Market (the "NASDAQ
STOCK MARKET"), and the Company has taken no action intended to, or which to its
knowledge is likely to have the effect of, terminating the registration of the
Common Stock under the Exchange Act or delisting the Common Stock from the
Nasdaq Stock Market.
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The issuance of the Shares does not require shareholder approval, including,
without limitation, pursuant to Nasdaq Marketplace Rule 4350(i).
3.14 REPORTING STATUS. The Company has timely made all filings
required under the Exchange Act during the twelve (12) months preceding the date
of this Agreement, and all of those documents complied in all material respects
with the SEC's requirements as of their respective filing dates, and the
information contained therein as of the respective dates thereof did not contain
an untrue statement of a material fact or omit to state 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. The Company is
currently eligible to register the resale of Common Stock by the Investors
pursuant to a registration statement on Form S-3 under the Securities Act (the
"REGISTRATION STATEMENT").
3.15 NO MANIPULATION; DISCLOSURE OF INFORMATION. The Company has not
taken and will not take any action designed to or that might reasonably be
expected to cause or result in an unlawful manipulation of the price of the
Common Stock to facilitate the sale or resale of the Shares. The Company has not
disclosed any material non-public information to the Investors.
3.16 ACCOUNTANTS. Ernst & Young LLP, who expressed their opinion with
respect to the consolidated financial statements to be incorporated by reference
from the Company's Annual Report on Form 10-K for the year ended December 31,
2003 into the Registration Statement and the prospectus which will form a part
thereof (the "PROSPECTUS"), have advised the Company that they are, and to the
knowledge of the Company they are, independent accountants as required by the
Securities Act and the rules and regulations promulgated thereunder.
3.17 CONTRACTS. Except for matters which are not reasonably likely to
have a Material Adverse Effect and those contracts that are substantially or
fully performed or expired by their terms, the contracts listed as exhibits to
or described in the SEC Reports that are material to the Company and all
amendments thereto, are in full force and effect on the date hereof, and neither
the Company nor, to the Company's knowledge, any other party to such contracts
is in breach of or default under any of such contracts.
3.18 TAXES. Except for matters which are not reasonably likely have a
Material Adverse Effect, each of the Company and the Subsidiary 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 the Company has no knowledge
of a tax deficiency which has been asserted or threatened against the Company or
the Subsidiary.
3.19 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 hereunder will be, or will have been, fully
paid or provided for by the Company and the Company will have complied with all
laws imposing such taxes.
3.20 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, and will not be deemed an "investment company" as a result of the
transactions contemplated by this Agreement.
3.21 INSURANCE. Each of the Company and the Subsidiary maintains
insurance of the types and in the amounts that the Company reasonably believes
is adequate for its businesses, including, but not limited to, insurance
covering real and personal property owned or leased by the Company or the
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Subsidiary 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.
3.22 OFFERING PROHIBITIONS. 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 as approved by Xxxxxxxx Inc.
as representative of the Placement Agents. Neither the Company nor any person
acting on its behalf or at its direction has in the past or will in the future
take any action to sell, offer for sale or solicit offers to buy any securities
of the Company that would (i) bring the offer or sale of the Shares as
contemplated by this Agreement within the provisions of Section 5 of the
Securities Act, or (ii) cause the offer or sale of the Shares as contemplated by
this Agreement to be integrated with prior offerings by the Company for purposes
of any applicable stockholder approval provisions, including, without
limitation, the rules and regulations of any exchange or automated quotation
system on which any of the securities of the Company are listed or designated.
3.23 LISTING. The Company shall comply with all requirements of the
NASD with respect to the issuance of the Shares and the listing thereof on the
Nasdaq Stock Market.
3.24 RELATED PARTY TRANSACTIONS. No transaction has occurred between
or among the Company or any of its affiliates, officers or directors or, to the
knowledge of the Company, any affiliate or affiliates of any such officer or
director that with the passage of time will be required to be disclosed pursuant
to Section 13, 14 or 15(d) of the Exchange Act.
3.25 NO BROKERS. Other than the Placement Agents, no person or entity
will be entitled to receive any brokerage commission, finder's fee, fee for
financial advisory services or similar compensation in connection with the sale
of the Shares to the Investor based on any contract made by or on behalf of the
Company.
3.26 BOOKS AND RECORDS. The books, records and accounts of the Company
accurately and fairly reflect, in reasonable detail, the transactions in, and
dispositions of, the assets of, and the operations of, the Company. The Company
maintains a system of internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management's general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles and to maintain asset accountability,
(iii) access to assets is permitted only in accordance with management's general
or specific authorization and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences. The Company maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 under the
Exchange Act) that are effective in ensuring that information required to be
disclosed by the Company in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported, within the time
periods specified in the rules and forms of the Securities and Exchange
Commission ("SEC"), including, without limitation, controls and procedures
designed to ensure that information required to be disclosed by the Company in
the reports that it files or submits under the Exchange Act is accumulated and
communicated to the company's management, including its principal executive
officer or officers and its principal financial officer or officers, as
appropriate to allow timely decisions regarding required disclosure.
3.27 SECURITIES ACT EXEMPTION. Subject to the accuracy of the
Investor's representations and warranties in Section 4 of this Agreement, the
offer, sale and issuance of the Shares in conformity with the terms of this
Agreement constitute transactions exempt from the registration requirements of
Section 5 of the Securities Act and from the registration or qualification
requirements of the laws of any applicable state or United States jurisdiction.
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4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE INVESTOR.
4.1 INVESTOR KNOWLEDGE AND STATUS. The Investor represents and
warrants to, and covenants with, the Company that: (i) the Investor is an
"accredited investor" as defined in Regulation D under the Securities Act, is
knowledgeable, sophisticated and experienced in making, and is qualified to make
decisions with respect to, investments in securities presenting an investment
decision similar to that involved in the purchase of the Shares, and has
requested, received, reviewed and considered all information it deemed relevant
in making an informed decision to purchase the Shares; (ii) the Investor
understands that the Shares are "restricted securities" and have not been
registered under the Securities Act and is acquiring the number of Shares set
forth in paragraph 3 of the Stock Purchase Agreement in the ordinary course of
its business and for its own account for investment only, has no present
intention of distributing any of such Shares and has no arrangement or
understanding with any other persons regarding the distribution of such Shares
(this representation and warranty not limiting the Investor's right to sell
Shares pursuant to the Registration Statement or otherwise or, other than with
respect to any claim arising out of a breach of this representation and
warranty, the Investor's right to indemnification under Section 6.3); (iii) the
Investor will not, directly or indirectly, 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 except in compliance with the
Securities Act, applicable state securities laws and the respective rules and
regulations promulgated thereunder; (iv) the Investor has answered all questions
in paragraph 4 of the Stock Purchase Agreement and the Investor Questionnaire
attached hereto as Exhibit B for use in preparation of the Registration
Statement and the answers thereto are true and correct as of the date hereof and
will be true and correct as of the Closing Date; (v) the Investor will notify
the Company promptly of any change in any of such information until such time as
the Investor has sold all of its Shares or until the Company is no longer
required to keep the Registration Statement effective; (vi) the Investor is not
a "dealer" within the meaning of the Securities Act or a "broker" or "dealer"
within the meaning of the Exchange Act; and (vii) the Investor has, in
connection with its decision to purchase the number of Shares set forth in
paragraph 3 of the Stock Purchase Agreement, relied only upon the
representations and warranties of the Company contained herein and the
information contained in the SEC Reports. The Investor understands that the
issuance of the Shares to the Investor has not been registered under the
Securities Act, or registered or qualified under any state securities law, in
reliance on specific exemptions therefrom, which exemptions may depend upon,
among other things, the representations made by the Investor in this Agreement.
No person (including without limitation the Placement Agents) is authorized by
the Company to provide any representation that is inconsistent with or in
addition to those contained herein or in the SEC Reports, and the Investor
acknowledges that it has not received or relied on any such representations.
4.2 TRANSFER OF SHARES. The Investor agrees that it will not make any
sale, transfer or other disposition of the Shares (a "DISPOSITION") other than
Dispositions that are made pursuant to the Registration Statement in compliance
with any applicable prospectus delivery requirements or that are exempt from
registration under the Securities Act.
4.3 POWER AND AUTHORITY. The Investor represents and warrants to the
Company that (i) the Investor has full right, power, authority and capacity to
enter into this Agreement and to consummate the transactions contemplated hereby
and has taken all necessary action to authorize the execution, delivery and
performance of this Agreement, and (ii) this Agreement constitutes a valid and
binding obligation of the Investor enforceable against the Investor in
accordance with its terms, except to the extent (i) rights to indemnity and
contribution may be limited by state or federal securities laws or the public
policy underlying such laws, (ii) such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' and contracting parties' rights generally and (iii) such
enforceability may be subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
8
4.4 SHORT POSITION. The Investor has not, prior to the Closing Date,
established any hedge or other position in the Common Stock that is outstanding
on the Closing Date and that is designed to or could reasonably be expected to
lead to or result in a Disposition by the Investor or any other person or
entity. For purposes hereof, a "hedge or other position" would include, without
limitation, effecting any short sale or having in effect any short position
(whether or not such sale or position is against the box and regardless of when
such position was entered into) or any purchase, sale or grant of any right
(including, without limitation, any put or call option) with respect to the
Common Stock or with respect to any security (other than a broad-based market
basket or index) that includes, relates to or derives any significant part of
its value from the Common Stock.
4.5 NO INVESTMENT, TAX OR LEGAL ADVICE. The Investor understands that
nothing in the SEC Reports, this Agreement, or any other materials presented to
the Investor in connection with the purchase and sale of the Shares constitutes
legal, tax or investment advice. The Investor has consulted such legal, tax and
investment advisors as it, in its sole discretion, has deemed necessary or
appropriate in connection with its purchase of Shares.
4.6 CONFIDENTIAL INFORMATION. The Investor covenants that from the
date hereof it will maintain in confidence the receipt and content of any
Suspension Notice (as defined in Section 6.2(c)) received by the Investor from
the Company until such Suspension (as defined in Section 6.2(c)) is no longer in
effect or until the reason behind such Suspension Notice (a) becomes generally
publicly available other than through a violation of this provision by the
Investor or its agents or (b) is required to be disclosed in legal proceedings
(such as by deposition, interrogatory, request for documents, subpoena, civil
investigation demand, filing with any governmental authority or similar
process); provided, however, that before making any disclosure in reliance on
this Section 4.6, the Investor will give the Company at least fifteen (15) days
prior written notice (or such shorter period as required by law) specifying the
circumstances giving rise thereto and will furnish only that portion of the
non-public information which is legally required and will exercise its
commercially reasonable efforts to ensure that confidential treatment will be
accorded any non-public information so furnished. The parties acknowledge and
agree that as of the date hereof and as of the Closing Date, the Company has not
disclosed any material non-public information to the Investor.
4.7 ACKNOWLEDGMENTS REGARDING PLACEMENT AGENTS. The Investor
acknowledges that the Placement Agents have acted solely as placement agents for
the Company in connection with the Offering of the Shares by the Company, and
that the Placement Agents have made no representation or warranty whatsoever
with respect to the accuracy or completeness of information, data or other
related disclosure material that has been provided to the Investor. The Investor
further acknowledges that in making its decision to enter into this Agreement
and to purchase the Shares, it has relied on its own examination of the Company
and the terms of, and consequences of holding, the Shares. The Investor further
acknowledges that the provisions of this Section 4.7 are for the benefit of, and
may be enforced by, the Placement Agents.
4.8 ADDITIONAL ACKNOWLEDGEMENT. The Investor acknowledges that it has
independently evaluated the merits of the transactions contemplated by this
Agreement, that it has independently determined to enter into the transactions
contemplated hereby, that it is not relying on any advice from or evaluation by
any Other Investor, and that it is not acting in concert with any Other Investor
in making its purchase of the Shares hereunder. The Investor and, to its
knowledge, the Company acknowledge that the Investors have not taken any actions
that would deem the Investors to be members of a "group" for purposes of Section
13(d) of the Exchange Act.
5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement or by the
Placement Agents, all covenants,
9
agreements, representations and warranties made by the Company and the Investor
herein shall survive the execution of this Agreement, the delivery to the
Investor of the Shares being purchased and the payment therefor.
6. REGISTRATION OF THE SHARES; COMPLIANCE WITH THE SECURITIES ACT.
6.1 REGISTRATION PROCEDURES AND EXPENSES. The Company shall:
(a) as soon as practicable, but in any event no later than
thirty (30) days following the Closing Date (the "REQUIRED FILING DATE"),
prepare and file with the SEC, a Registration Statement on Form S-3 to enable
the resale of the Shares by the Investors from time to time;
(b) use its best efforts, subject to receipt of necessary
information from the Investors, to cause the Registration Statement to become
effective as soon as practicable, but in no event later than (i) ninety (90)
days after the Closing Date if the Registration Statement is not reviewed by the
SEC, or (ii) one hundred and twenty (120) days after the Closing Date if the
Registration Statement is reviewed by the SEC (the "REQUIRED EFFECTIVE DATE"),
such efforts to include, without limiting the generality of the foregoing,
preparing and filing with the SEC in such 120-day period any financial
statements that are required to be filed prior to the effectiveness of such
Registration Statement. In the event that the Registration Statement (i) has not
been filed by the Required Filing Date or (ii) has not been declared effective
by the Required Effective Date (each a "REGISTRATION DEFAULT"), for each day
during which the Registration Default remains uncured, the Company shall pay to
each Investor in cash an amount equal to .0333% of the amount such Investor paid
to acquire the Shares from the Company (the "LATE REGISTRATION PAYMENTS");
provided, however, that in no event shall the Late Registration Payments, if
any, exceed in the aggregate five percent (5%) of the amount such Investor paid
to acquire the Shares from the Company. The Late Registration Payments shall be
payable as of the last day of the month in which a Registration Default occurs
and the end of each succeeding month during all or part of which such
Registration Default remains uncured.
(c) use its best efforts to prepare and file with the SEC such
amendments and supplements to the Registration Statement and the Prospectus as
may be necessary to keep the Registration Statement current and effective for a
period ending on the earlier of (i) the second anniversary of the Closing Date,
(ii) the date on which the Investor may sell Shares pursuant to paragraph (k) of
Rule 144 under the Securities Act or any successor rule ("RULE 144") or (iii)
such time as all Shares purchased by such Investor in this Offering have been
sold pursuant to a registration statement or Rule 144, and to notify each
Investor promptly upon the Registration Statement, and each post-effective
amendment thereto, being declared effective by the SEC;
(d) furnish to the Investor such number of copies of the
Registration Statement, and the Prospectus (including supplemental prospectuses)
as the Investor may reasonably request in order to facilitate the public sale or
other disposition of all or any of the Shares by the Investor;
(e) file documents required of the Company for normal blue sky
clearance in states specified in writing by the Investor; provided, however,
that the Company shall not be required to qualify to do business or consent to
service of process in any jurisdiction in which it is not now so qualified or
has not so consented;
(f) bear all expenses (other than underwriting discounts and
commissions, if any) in connection with the procedures in paragraph (a) through
(e) of this Section 6.1 and the registration of the Shares pursuant to the
Registration Statement;
10
(g) advise the Investors, promptly after it shall receive notice
or obtain knowledge of the issuance of any stop order by the SEC delaying or
suspending the effectiveness of the Registration Statement or of the initiation
of any proceeding for that purpose; and it will promptly use its commercially
reasonable efforts to prevent the issuance of any stop order or to obtain its
withdrawal at the earliest possible moment if such stop order should be issued;
and
(h) with a view to making available to the Investor the benefits
of Rule 144 and any other rule or regulation of the SEC that may at any time
permit the Investor to sell Shares to the public without registration, the
Company covenants and agrees to use its best efforts to: (i) make and keep
public information available, as those terms are understood and defined in Rule
144, until the earlier of (A) such date as all of the Investor's Shares may be
resold pursuant to Rule 144(k) or any other rule of similar effect or (B) such
date as all of the Investor's Shares shall have been resold; (ii) file with the
SEC in a timely manner all reports and other documents required of the Company
under the Securities Act and under the Exchange Act; and (iii) furnish to the
Investor upon request, as long as the Investor owns any Shares, (A) a written
statement by the Company that it has complied with the reporting requirements of
the Securities Act and the Exchange Act, (B) a copy of the Company's most recent
Annual Report on Form 10-K or Quarterly Report on Form 10-Q, and (C) such other
information as may be reasonably requested in order to avail the Investor of any
rule or regulation of the SEC that permits the selling of any such Shares
without registration.
It shall be a condition precedent to the obligations of the Company to take
any action pursuant to this Section 6.1 that the Investor shall furnish to the
Company such information regarding itself, the Shares to be sold by Investor,
and the intended method of disposition of such securities as shall be required
to effect the registration of the Shares.
The Company understands that the Investor disclaims being an underwriter,
but acknowledges that a determination by the SEC that the Investor is deemed an
underwriter shall not relieve the Company of any obligations it has hereunder.
6.2 TRANSFER OF SHARES AFTER REGISTRATION; SUSPENSION.
(a) The Investor 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 other than transactions exempt from the
registration requirements of the Securities Act, as contemplated in the
Registration Statement and as described below, and that it will promptly notify
the Company of any material changes in the information set forth in the
Registration Statement regarding the Investor or its plan of distribution.
(b) Except in the event that paragraph (c) below applies, the
Company shall: (i) if deemed necessary by the Company, prepare and file from
time to time with the SEC a post-effective amendment to the Registration
Statement or a supplement to the related Prospectus or a supplement or amendment
to any document incorporated therein by reference or file any other required
document so that such Registration Statement will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
so that, as thereafter delivered to purchasers of the Shares being sold
thereunder, such Prospectus will not contain an untrue statement of a material
fact or omit to state 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; (ii) provide the Investor copies of any documents
filed pursuant to Section 6.2(b)(i); and (iii) upon request, inform each
Investor who so requests that the Company has complied with its obligations in
Section 6.2(b)(i) (or that, if the Company has filed a post-effective amendment
to the Registration Statement which has not yet been declared effective, the
Company will notify the Investor to
11
that effect, will use its best efforts to secure the effectiveness of such
post-effective amendment as promptly as possible and will promptly notify the
Investor pursuant to Section 6.2(b)(i) hereof when the amendment has become
effective).
(c) Subject to paragraph (d) below, in the event: (i) of any
request by the SEC or any other federal or state governmental authority during
the period of effectiveness of the Registration Statement for amendments or
supplements to the Registration Statement or related Prospectus or for
additional information; (ii) of the issuance by the SEC or any other federal or
state governmental authority of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose; (iii) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Shares for sale in any jurisdiction or the initiation of any proceeding for
such purpose; or (iv) of any event or circumstance which necessitates the making
of any changes in the Registration Statement or Prospectus, or any document
incorporated or deemed to be incorporated therein by reference, so that, in the
case of the Registration Statement, it will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, and that in the case
of the Prospectus, it will not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, then the Company shall promptly deliver a certificate
in writing to the Investor (the "SUSPENSION NOTICE") to the effect of the
foregoing and, upon receipt of such Suspension Notice, the Investor will refrain
from selling any Shares pursuant to the Registration Statement (a "SUSPENSION")
until the Investors are advised in writing by the Company that the current
Prospectus may be used, and has received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in any such Prospectus. In the event of any Suspension, the Company will use its
reasonable best efforts to cause the use of the Prospectus so suspended to be
resumed as soon as reasonably practicable after delivery of a Suspension Notice
to the Investors. In addition to and without limiting any other remedies
(including, without limitation, at law or at equity) available to the Investor,
the Investor shall be entitled to specific performance in the event that the
Company fails to comply with the provisions of this Section 6.2(c).
(d) Notwithstanding the foregoing paragraphs of this Section
6.2, the Company shall use its best efforts to ensure that the Investor shall
not be prohibited from selling Shares under the Registration Statement as a
result of Suspensions on more than two occasions, such occasions not to occur
within two weeks of one another, of not more than thirty (30) days in any twelve
month period, unless, in the good faith judgment of the Company's Board of
Directors, upon advice of counsel, the sale of Shares under the Registration
Statement would be reasonably likely to cause a violation of the Securities Act
or the Exchange Act and result in potential liability to the Company; provided,
however, in the event that the Investor is prohibited from selling Shares as a
result of Suspensions that do not conform to the requirements of this Section
6.2(d), then for each day during which the Investor must refrain from selling
any Shares pursuant to the Registration Statement in excess of the days allowed
by this Section 6.2(d), the Company shall pay to such Investor in cash an amount
equal to .0333% of the amount such Investor paid to acquire the Shares from the
Company. The penalty payments described in this Section 6.2(d) shall be payable
as of the last day of the month in which a Suspension occurs and the end of each
succeeding month during all or part of which such Suspension remains in effect.
(e) If a Suspension is not then in effect, the Investor may sell
Shares under the Registration Statement, provided that it complies with any
applicable prospectus delivery requirements. Upon receipt of a request therefor,
the Company will provide an adequate number of current Prospectuses to the
Investor and to any other parties requiring such Prospectuses.
12
(f) In the event of a sale of Shares by the Investor, unless
such requirement is waived by the Company in writing, the Investor must also
deliver to the Company's transfer agent, with a copy to the Company, a
Certificate of Subsequent Sale substantially in the form attached hereto as
Exhibit C, so that the Shares may be properly transferred.
(g) The Company agrees that it shall, immediately prior to the
Registration Statement being declared effective, deliver to its transfer agent
an opinion letter of counsel, opining that at any time the Registration
Statement is effective, the transfer agent shall issue, in connection with the
sale of the Shares, certificates representing such Shares without restrictive
legend, provided the Shares are to be sold pursuant to the Prospectus contained
in the Registration Statement and the transfer agent receives a Certificate of
Subsequent Sale in the form attached hereto as Exhibit C. Upon receipt of such
opinion, the Company shall cause the transfer agent to confirm, for the benefit
of the Investor, that no further opinion of counsel is required at the time of
transfer in order to issue such Shares without restrictive legend.
The Company shall cause its transfer agent to issue a certificate
without any restrictive legend to a purchaser of any such Shares from an
Investor, if (a) the sale of such Shares is registered under the Registration
Statement (including registration pursuant to Rule 415 under the Securities Act)
and the Investor has delivered a Certificate of Subsequent Sale to the Transfer
Agent; (b) the holder has provided the Company with an opinion of counsel, in
form, substance and scope customary for opinions of counsel in comparable
transactions, to the effect that a public sale or transfer of such Shares may be
made without registration under the Securities Act; or (c) such Shares are sold
in compliance with Rule 144 under the Securities Act.
6.3 INDEMNIFICATION. For the purpose of this Section 6.3:
(a) the term "SELLING SHAREHOLDER" shall mean the Investor and
each person, if any, who controls the Investor within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act;
(b) the term "REGISTRATION STATEMENT" shall include any final
Prospectus, exhibit, supplement or amendment included in or relating to, and any
document incorporated by reference in, the Registration Statement (or deemed to
be a part thereof) referred to in Section 6.1; and
(c) the term "UNTRUE STATEMENT" shall mean any untrue statement
or alleged untrue statement, or any omission or alleged omission to state in the
Registration Statement a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(d) (i) The Company agrees to indemnify and hold harmless each
Selling Shareholder from and against any losses, claims, damages or liabilities
to which such Selling Shareholder may become subject (under the Securities Act
or otherwise) insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of, or are based upon (i) any
untrue statement or omission of a material fact contained in the Registration
Statement or the Prospectus or in any amendment or supplement thereto, (ii) any
inaccuracy in the representations and warranties of the Company contained in the
Agreement or the failure of the Company to perform its obligations hereunder or
(iii) any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will reimburse such Selling Shareholder
for any reasonable legal expense or other actual accountable out of pocket
expenses reasonably incurred in investigating, defending or preparing to defend
any such action, proceeding or claim; provided, however, that the Company shall
not be liable in any such case to the extent that such loss, claim, damage or
liability arises out of, or is based
13
upon, an untrue statement made in such Registration Statement in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of such Selling Shareholder specifically for use in preparation of the
Registration Statement, or any inaccuracy in representations made by such
Selling Shareholder in the Investor Questionnaire or the failure of such Selling
Shareholder to comply with its covenants and agreements contained in Sections
4.1, 4.2, 4.3, 4.4 or 6.2 hereof or any statement or omission in any Prospectus
that is corrected in any subsequent Prospectus that was delivered to the Selling
Shareholder prior to the pertinent sale or sales by the Selling Shareholder.
(ii) The Investor agrees to indemnify and hold harmless the
Company (and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act, each officer of the Company who signs the
Registration Statement and each director of the Company) from and against any
losses, claims, damages or liabilities to which the Company (or any such
officer, director or controlling person) may become subject (under the
Securities Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, (i) any failure to comply with the covenants and agreements
contained in Section 4.1, 4.2, 4.3, 4.4 or 6.2 hereof, or (ii) any untrue
statement of a material fact contained in the Registration Statement if, and
only if, such untrue statement was made in reliance upon and in conformity with
written information furnished by or on behalf of the Investor specifically for
use in preparation of the Registration Statement, and the Investor will
reimburse the Company (or such officer, director or controlling person), as the
case may be, for any reasonable legal expense or other actual accountable out of
pocket expenses reasonably incurred in investigating, defending or preparing to
defend any such action, proceeding or claim. The obligation to indemnify shall
be limited to the net amount of the proceeds received by the Investor from the
sale of the Shares pursuant to the Registration Statement.
(iii) Promptly after receipt by any indemnified person of a
notice of a claim or the beginning of any action in respect of which indemnity
is to be sought against an indemnifying person pursuant to this Section 6.3,
such indemnified person shall notify the indemnifying person in writing of such
claim or of the commencement of such action, but the omission to so notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party under this Section 6.3 (except to the extent that such
omission materially and adversely affects the indemnifying party's ability to
defend such action) or from any liability otherwise than under this Section 6.3.
Subject to the provisions hereinafter stated, in case any such action shall be
brought against an indemnified person, the indemnifying person shall be entitled
to participate therein, and, to the extent that it shall elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid notice
from such indemnified party, shall be entitled to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified person. After notice
from the indemnifying person to such indemnified person of its election to
assume the defense thereof (unless it has failed to assume the defense thereof
and appoint counsel reasonably satisfactory to the indemnified party), such
indemnifying person shall not be liable to such indemnified person for any legal
expenses subsequently incurred by such indemnified person in connection with the
defense thereof; provided, however, that if there exists or shall exist a
conflict of interest that would make it inappropriate, in the reasonable opinion
of counsel to the indemnified person, for the same counsel to represent both the
indemnified person and such indemnifying person or any affiliate or associate
thereof, the indemnified person shall be entitled to retain its own counsel at
the expense of such indemnifying person; provided, however, that no indemnifying
person shall be responsible for the fees and expenses of more than one separate
counsel (together with appropriate local counsel) for all indemnified parties.
In no event shall any indemnifying person be liable in respect of any amounts
paid in settlement of any action unless the indemnifying person shall have
approved the terms of such settlement; provided that such consent shall not be
unreasonably withheld. No indemnifying person shall, without the prior written
consent of the indemnified person, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified person is or could
reasonably have been a party and indemnification could have been sought
hereunder by such
14
indemnified person, unless such settlement includes an unconditional release of
such indemnified person from all liability on claims that are the subject matter
of such proceeding.
(iv) If the indemnification provided for in this Section 6.3
is unavailable to or insufficient to hold harmless an indemnified party under
subsection (d)(i) or (d)(ii) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Investor on
the other in connection with the statements or omissions or other matters which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
fault shall be determined by reference to, among other things, in the case of an
untrue statement, whether the untrue statement relates to information supplied
by the Company on the one hand or the Investor on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement. The Company and the Investor agree that it would
not be just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation (even if the Investors were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), the Investor shall not be required to
contribute any amount in excess of the amount by which the gross amount received
by the Investor from the sale of the Shares to which such loss relates exceeds
the amount of any damages which the Investor has otherwise been required to pay
by reason of such untrue statement. 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 Investors' obligations in this subsection to
contribute are several in proportion to their sales of Shares to which such loss
relates and not joint.
The parties to this Agreement hereby acknowledge that they
are sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof including, without limitation, the
provisions of this Section 6.3, and are fully informed regarding said
provisions. They further acknowledge that the provisions of this Section 6.3
fairly allocate the risks in light of the ability of the parties to investigate
the Company and its business in order to assure that adequate disclosure is made
in the Registration Statement as required by the Securities Act and the Exchange
Act.
6.4 TERMINATION OF CONDITIONS AND OBLIGATIONS. The conditions
precedent imposed by Section 4 or this Section 6 upon the transferability of the
Shares shall cease and terminate as to any particular number of the Shares when
such Shares (i) shall have been effectively registered under the Securities Act
and sold or otherwise disposed of in accordance with the intended method of
disposition set forth in the Registration Statement covering such Shares, (ii)
are eligible for sale under Rule 144 or (iii) at such time as an opinion of
counsel satisfactory to the Company shall have been rendered to the effect that
such conditions are not necessary in order to comply with the Securities Act.
6.5 INFORMATION AVAILABLE. So long as the Registration Statement is
effective covering the resale of Shares owned by the Investor, the Company will
furnish (or, to the extent such information is available electronically through
the Company's filings with the SEC, the Company will make available) to the
Investor:
15
(a) as soon as practicable after it is available, one copy of
(i) its Annual Report to Shareholders (which Annual Report shall contain
financial statements audited in accordance with generally accepted accounting
principles by a national firm of certified public accountants) and (ii) if not
included in substance in the Annual Report to Shareholders, its Annual Report on
Form 10-K (the foregoing, in each case, excluding exhibits);
(b) upon the reasonable request of the Investor, all exhibits
excluded by the parenthetical to subparagraph (a)(ii) of this Section 6.5 as
filed with the SEC and all other information that is made available to
shareholders; and
(c) upon the reasonable request of the Investor, an adequate
number of copies of the Prospectuses to supply to any other party requiring such
Prospectuses; and the Company, upon the reasonable request of the Investor, will
meet with the Investor or a representative thereof at the Company's headquarters
during the Company's normal business hours to discuss all information relevant
for disclosure in the Registration Statement covering the Shares and will
otherwise reasonably cooperate with the Investor conducting an investigation for
the purpose of reducing or eliminating the Investor's exposure to liability
under the Securities Act, including the reasonable production of information at
the Company's headquarters; provided, that the Company shall not be required to
disclose any confidential information to or meet at its headquarters with the
Investor until and unless the Investor shall have entered into a confidentiality
agreement in form and substance reasonably satisfactory to the Company with the
Company with respect thereto.
6.6 PUBLIC STATEMENTS. The Company shall, on or before 8:30 a.m., New
York time, on the first Business Day following execution of the Agreements,
issue a press release disclosing all material terms of the Offering. Within one
(1) Business Day after the Closing Date, the Company shall file a Current Report
on Form 8-K with the SEC (the "8-K FILING") describing the terms of the Offering
and including as exhibits to the 8-K filing this Agreement in the form required
by the Exchange Act. Thereafter, the Company shall timely file any filings and
notices required by the SEC or applicable law with respect to the Offering and
provide copies thereof to the Investors promptly after filing. The Company shall
not publicly disclose the name of any Investor, or include the name of any
Investor in any press release without the prior written consent of such
Investor.
6.7 LIMITS ON ADDITIONAL ISSUANCES. Except for the issuance of stock
options under the Company's stock option plans, the issuance of common stock
under the Company's employee stock purchase plan or upon exercise of outstanding
options and warrants and the offering contemplated hereby, the Company will not,
for a period of six (6) months following the Closing Date, offer for sale or
sell any securities unless, in the opinion of the Company's counsel, such offer
or sale does not jeopardize the availability of exemptions from the registration
and qualification requirements under applicable securities laws with respect to
the Offering. The foregoing shall not apply to securities issued in connection
with any acquisition, including by way of merger, or purchase of stock or all or
substantially all of the assets of any third party. Except for the issuance of
stock options under the Company's stock option plans, the issuance of common
stock under the Company's employee stock purchase plan or upon exercise of
outstanding options and warrants, the issuance of common stock purchase
warrants, and the offering contemplated hereby, the Company has not engaged in
any such offering during the six (6) months prior to the date of this Agreement.
The foregoing provisions shall not prevent the Company from filing a "shelf"
registration statement pursuant to Rule 415 under the Securities Act, but the
foregoing provisions shall apply to any sale of securities thereunder.
7. NOTICES. All notices, requests, consents and other communications
hereunder shall be in writing, shall be delivered (A) if within the United
States, by first-class registered or certified airmail, or nationally recognized
overnight express courier, postage prepaid, or by facsimile, or (B) if from
outside
16
the United States, by International Federal Express (or comparable service) or
facsimile, and shall be deemed given (i) if delivered by first-class registered
or certified mail domestic, upon the Business Day received, (ii) if delivered by
nationally recognized overnight carrier, one (1) Business Day after timely
delivery to such carrier, (iii) if delivered by International Federal Express
(or comparable service), two (2) Business Days after timely delivery to such
carrier, (iv) if delivered by facsimile, upon electric confirmation of receipt;
and shall be addressed as follows, or to such other address or addresses as may
have been furnished in writing by a party to another party pursuant to this
paragraph:
(a) if to the Company, to:
Vascular Solutions, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx & Whitney LLP
Suite 1500, 00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(b) if to the Investor, at its address on the signature page to
the Stock Purchase Agreement.
8. AMENDMENTS; WAIVER. This Agreement may not be modified or amended
except pursuant to an instrument in writing signed by the Company and the
Investor. Any waiver of a provision of this Agreement must be in writing and
executed by the party against whom enforcement of such waiver is sought.
9. 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. 10. ENTIRE AGREEMENT; SEVERABILITY. This Agreement sets
forth the entire agreement and understanding of the parties relating to the
subject matter hereof and supersedes all prior and contemporaneous agreements,
negotiations and understandings between the parties, both oral and written
relating to the subject matter hereof. If any provision contained in this
Agreement is determined to 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.
11. GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of Minnesota, without giving
effect to the principles of conflicts of law.
12. 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
17
instrument, and shall become effective when one or more counterparts have been
signed by each party hereto and delivered to the other parties.
18
EXHIBIT A
VASCULAR SOLUTIONS, INC.
STOCK CERTIFICATE QUESTIONNAIRE
Pursuant to Section 4 of the Agreement, please provide us with the
following information:
1. The exact name in which your Shares
are to be registered (this is the
name that will appear on your stock
certificate(s)). You may use a
nominee name if appropriate:
-----------------------------------
2. If a nominee name is listed in
response to item 1 above, the
relationship between the Investor
and such nominee:
-----------------------------------
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 the
response to item 1 above:
-----------------------------------
A-1
EXHIBIT B
VASCULAR SOLUTIONS, INC.
INVESTOR QUESTIONNAIRE
(ALL INFORMATION WILL BE TREATED CONFIDENTIALLY)
To: Vascular Solutions, Inc.,
The undersigned hereby acknowledges the following:
This Investor Questionnaire ("QUESTIONNAIRE") must be completed by
each potential investor in connection with the offer and sale of the shares
of the common stock, par value $.01 per share (the "SHARES"), of Vascular
Solutions, Inc. (the "COMPANY"). The Shares are being offered and sold by
the Company without registration under the Securities Act of 1933, as
amended (the "SECURITIES ACT"), and the securities laws of certain states,
in reliance on the exemptions contained in Section 4 of the Securities Act
and on Regulation D promulgated thereunder and in reliance on similar
exemptions under applicable state laws. The Company must determine that a
potential investor meets certain suitability requirements before offering
or selling Shares to such investor. The purpose of this Questionnaire is to
assure the Company that each investor will meet the applicable suitability
requirements. The information supplied by the undersigned will be used in
determining whether the undersigned meets such criteria, and reliance upon
the private offering exemption from registration is based in part on the
information herein supplied.
This Questionnaire does not constitute an offer to sell or a
solicitation of an offer to buy any security. The undersigned's answers
will be kept strictly confidential. However, by signing this Questionnaire
the undersigned will be authorizing the Company to provide a completed copy
of this Questionnaire to such parties as the Company deems appropriate in
order to ensure that the offer and sale of the Shares will not result in a
violation of the Securities Act or the securities laws of any state and
that the undersigned otherwise satisfies the suitability standards
applicable to purchasers of the Shares. All potential investors must answer
all applicable questions and complete, date and sign this Questionnaire.
The undersigned shall print or type its responses and attach additional
sheets of paper if necessary to complete its answers to any item.
A. BACKGROUND INFORMATION
Name: __________________________________________________________________________
Business Address: ______________________________________________________________
(Number and Street)
_______________________________________________________________________________
(City) (State) (Zip Code)
Telephone Number: ( )__________________________________________________________
Residence Address: _____________________________________________________________
(Number and Street)
_______________________________________________________________________________
(City) (State) (Zip Code)
Telephone Number: ( )__________________________________________________________
If an individual:
Age: ___ Citizenship: ______________ Where registered to vote: ___________
If a corporation, partnership, limited liability company, trust or other entity:
Type of entity: ________________________________________________________________
B-1
State of formation: ______________ Date of formation: ______________
Social Security or Taxpayer Identification No. _________________________________
Send all correspondence to (check one):
___ Residence Address ___ Business Address
B. STATUS AS ACCREDITED INVESTOR
The undersigned is an "accredited investor" as such term is defined in
Regulation D under the Securities Act, because at the time of the sale of the
Shares the undersigned falls within one or more of the following categories
(Please initial one or more, as applicable):
_____ (1) a bank as defined in Section 3(a)(2) of the Securities Act, or a
savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934; an insurance company as defined in Section 2(13) of the
Securities Act; an investment company registered under the Investment Company
Act of 1940 or a business development company as defined in Section 2(a)(48) of
that act; a Small Business Investment Company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
political subdivisions, or any agency or instrumentality of a state or its
political subdivisions for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974 if the investment decision
is made by a plan fiduciary, as defined in Section 3(21) of such act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000 or, if a self-directed plan, with the investment decisions made
solely by persons that are accredited investors;1
_____ (2) a private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940;
_____ (3) an organization described in Section 501(c)(3) of the Internal Revenue
Code of 1986, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the Shares
offered, with total assets in excess of $5,000,000;
_____ (4) a natural person whose individual net worth, or joint net worth with
that person's spouse, at the time of such person's purchase of the Shares
exceeds $1,000,000;
_____ (5) a natural person who had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that person's spouse in
excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year;
_____ (6) a trust, with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the Shares offered, whose purchase is directed by
a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D; and
_____ (7) an entity in which all of the equity owners are accredited investors
(as defined above).
-------------
(1) As used in this Questionnaire, the term "net worth" means the excess of
total assets over total liabilities. In computing net worth for the purpose of
subsection (4), the principal residence of the investor must be valued at cost,
including cost of improvements, or at recently appraised value by a professional
appraiser. In determining income, the investor should add to the investor's
adjusted gross income any amounts attributable to tax exempt income received,
losses claimed as a limited partner in any limited partnership, deductions
claimed for depreciation, contributions to an XXX or XXXXX retirement plan,
alimony payments, and any amount by which income from long-term capital gains
has been reduced in arriving at adjusted gross income.
B-2
C. REPRESENTATIONS
The undersigned hereby represents and warrants to the Company as follows:
1. Any purchase of the Shares would be solely for the account of the
undersigned and not for the account of any other person or with a view to any
resale, fractionalization, division, or distribution thereof.
2. The information contained herein is complete and accurate and may be
relied upon by the Company, and the undersigned will notify the Company
immediately of any material change in any of such information occurring prior to
the closing, if any, with respect to the purchase of Shares by the undersigned
or any co-purchaser.
3. There are no suits, pending litigation, or claims against the
undersigned that could materially affect the net worth of the undersigned as
reported in this Questionnaire.
4. The undersigned acknowledges that there may occasionally be times when
the Company, based on the advice of its counsel, determines that it must suspend
the use of the Prospectus forming a part of the Registration Statement (as such
terms are defined in the Stock Purchase Agreement to which this Questionnaire is
attached) until such time as an amendment to the Registration Statement has been
filed by the Company and declared effective by the Securities and Exchange
Commission or until the Company has amended or supplemented such Prospectus. The
undersigned is aware that, in such event, the Shares will not be subject to
ready liquidation, and that any Shares purchased by the undersigned would have
to be held during such suspension. The overall commitment of the undersigned to
investments which are not readily marketable is not excessive in view of the
undersigned's net worth and financial circumstances, and any purchase of the
Shares will not cause such commitment to become excessive. The undersigned is
able to bear the economic risk of an investment in the Shares.
5. The undersigned has carefully considered the potential risks relating
to the Company and a purchase of the Shares and fully understands that the
Shares are speculative investments which involve a high degree of risk of loss
of the undersigned's entire investment. Among others, the undersigned has
carefully considered each of the risks described in the Company's Annual Report
on Form 10-K for the year ended December 31, 2003.
6. The following is a list of all states and other jurisdictions in which
blue sky or similar clearance will be required in connection with the
undersigned's purchase of the Shares:
-------------------------------------------
-------------------------------------------
-------------------------------------------
The undersigned agrees to notify the Company in writing of any additional states
or other jurisdictions in which blue sky or similar clearance will be required
in connection with the undersigned's purchase of the Shares.
B-3
IN WITNESS WHEREOF, the undersigned has executed this Questionnaire this _____
day of __________, 2004, and declares under oath that it is truthful and
correct.
Print Name
By:
-----------------------------------
Signature
Title:
--------------------------------
(required for any purchaser that
is a corporation, partnership,
trust or other entity)
B-4
EXHIBIT C
VASCULAR SOLUTIONS, INC.
CERTIFICATE OF SUBSEQUENT SALE
[Transfer Agent]
-------------------------------
-------------------------------
RE: Sale of Shares of Common Stock of Vascular Solutions, Inc. (the
"Company") pursuant to the Company's Prospectus dated _______________,
2004 (the "Prospectus")
Dear Sir/Madam:
The undersigned hereby certifies, in connection with the sale of shares of
Common Stock of the Company included in the table of Selling Shareholders in the
Prospectus, that the undersigned has sold the Shares pursuant to the Prospectus
and in a manner described under the caption "Plan of Distribution" in the
Prospectus and that such sale complies with all applicable securities laws,
including, without limitation, the Prospectus delivery requirements of the
Securities Act of 1933, as amended.
Selling Shareholder (the beneficial owner):
-------------------------------
Record Holder (e.g., if held in name of nominee):
--------------------------
Restricted Stock Certificate No.(s):
---------------------------------------
Number of Shares Sold:
-----------------------------------------------------
Date of Sale:
--------------------------------------------------------------
In the event that you receive a stock certificate(s) representing more
shares of Common Stock than have been sold by the undersigned, then you should
return to the undersigned a newly issued certificate for such excess shares in
the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you
should place a stop transfer on your records with regard to such certificate.
Dated: Very truly yours,
----------------------
By:
--------------------------------
Print Name:
------------------------
Title:
-----------------------------
C-1
EXHIBIT D
FORM OF LEGAL OPINION
_____________, 2004
To: The Investors in Common Stock of Vascular Solutions, Inc.
Ladies and Gentlemen:
We have acted as counsel for Vascular Solutions, Inc., a Minnesota
corporation (the "Company"), in connection with the issuance of ______________
shares (the "Shares") of the Company's Common Stock, $.01 par value per share,
pursuant to those certain Stock Purchase Agreements, dated as of _________,
2004, including the annex and exhibits thereto (collectively, the "Agreement"),
between the Company and the Investors named therein. This opinion is being
delivered to you pursuant to Section 2 of the Agreement. Capitalized terms used
herein are as defined in the Agreement unless otherwise specifically provided
herein.
We have examined such documents and have reviewed such questions of
law as we have considered necessary or appropriate for the purpose of this
opinion.
In rendering our opinion below, we have assumed the authenticity of
all documents submitted to us as originals, the genuineness of all signatures,
and the conformity to authentic originals of all documents submitted to us as
copies. We have also assumed the legal capacity for all purposes relevant hereto
of all natural persons and, with respect to all parties to agreements and
instruments relevant hereto other than the Company, that such parties had the
requisite power and authority (corporate or otherwise) to execute, deliver and
perform such agreement or instruments, that such agreements or instruments have
been duly authorized by all requisite action (corporate or otherwise), executed
and delivered by such parties and that such agreements or instruments are the
valid, binding and enforceable obligations of such parties. As to questions of
fact material to our opinion, we have relied, without independent verification,
on the representations and warranties contained in the Agreement and on
certificates of officers of the Company and public officials.
Our opinions expressed below as to certain factual matters are
qualified as being limited "to our knowledge" or by other words to the same or
similar effect. Such words, as used herein, mean the information known to the
attorneys in this firm who have represented the Company in connection with the
matters addressed herein. In rendering such opinions, we have not conducted any
independent investigation or consulted with other attorneys in our firm with
respect to the matters covered by the Agreement. No inference as to our
knowledge with respect to such matters should be drawn from the fact of our
representation of the Company.
Based on the foregoing, we are of the opinion that:
1. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of
Minnesota, with the corporate power to conduct any lawful business
activity. The Company has the corporate power to execute, deliver and
perform the Agreement including, without limitation, the issuance and
sale of the Shares.
D-1
2. The Agreement has been duly authorized by all requisite
corporate action, executed and delivered by the Company. The Agreement
constitutes the valid and binding agreement of the Company enforceable
in accordance with its terms.
3. The Shares have been duly authorized and, upon issuance,
delivery and payment therefor as described in the Agreement, will be
validly issued, fully paid and nonassessable.
4. As of the date hereof, the authorized capital stock of the
Company consists of 40,000,000 shares of undesignated capital stock.
5. The execution, delivery and performance of the Agreement and
the issuance and sale of the Shares in accordance with the Agreement
will not: (a) violate or conflict with, or result in a breach of or
default under, the Articles of Incorporation or bylaws of the Company,
(b) violate or conflict with, or constitute a default under any
material agreement or instrument (limited, with your consent, to
agreements filed with the Securities and Exchange Commission under the
Exchange Act and applicable rules and regulations) to which the
Company is a party, or (c) violate any law of the United States or the
State of Minnesota, any rule or regulation of any governmental
authority or regulatory body of the United States or the State of
Minnesota, or any judgment, order or decree known to us and applicable
to the Company of any court, governmental authority or arbitrator.
6. No consent, approval, authorization or order of, and no
notice to or filing with, any governmental agency or body or any court
is required to be obtained or made by the Company for the issue and
sale of the Shares pursuant to the Agreement, except such as have been
obtained or made and such as may be required under the federal
securities laws or the Blue Sky laws of the various states.
7. Assuming the representations made by the Investors and the
Company set forth in the Agreement and the exhibits thereto are true
and correct and subject to the Placement Agents' compliance with
applicable securities laws and regulations (including, without
limitation, the requirements of Regulation D under the Securities
Act), the offer, sale, issuance and delivery of the Shares to the
Investors, in the manner contemplated by the Agreement, is exempt from
the registration requirements of the Securities Act, it being
understood that no opinion is expressed as to any subsequent resale of
such shares.
8. We know of no pending or overtly threatened lawsuit or claim
against the Company which is required to be described in the reports
filed by the Company with the Securities and Exchange Commission under
the Exchange Act and applicable rules and regulations thereunder that
is not so described as required.
The opinions set forth above are subject to the following
qualifications and exceptions:
(a) Our opinion in paragraph 2 above is subject to the effect of
any applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws of general application affecting creditors' rights.
(b) Our opinion in paragraph 2 above is subject to the effect of
general principles of equity, including (without limitation) concepts
of materiality,
D-2
reasonableness, good faith and fair dealing, and other similar
doctrines affecting the enforceability of agreements generally
(regardless of whether considered in a proceeding in equity or at
law).
(c) Our opinion in paragraph 2 above, insofar as it relates to
indemnification provisions, is subject to the effect of federal and
state securities laws and public policy relating thereto.
(d) We express no opinion as to the compliance or the effect of
noncompliance by the Investors with any state or federal laws or
regulations applicable to the Investors in connection with the
transactions described in the Agreement.
Our opinions expressed above are limited to the laws of the State of
Minnesota and the federal laws of the United States of America.
The foregoing opinions are being furnished to you solely for your
benefit and may not be relied upon by any other person without our prior written
consent. Notwithstanding the foregoing, Xxxxxxxx Inc. and Xxxxxx Xxxxxxx
Xxxxxxxx Xxxxxxx, Inc. may rely on the opinions herein expressed as if this
letter were addressed to them.
Very truly yours,
D-3
