Schedule 10.20
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Exhibit 10.20 is the form of Regulation S Securities Subscription Agreement
entered into by the Company and each of 22 subscribers for the sale and purchase
of an aggregate principal amount of $9.08 million of the Company's 10%
Convertible Debentures due March 4, 1999. All such executed agreements are
identical except for the identity of the subscriber and the principal amount of
debentures purchased.
EXHIBIT 10.20
UNIGENE LABORATORIES, INC.
REGULATION S SECURITIES SUBSCRIPTION AGREEMENT
THE DEBENTURES BEING SUBSCRIBED FOR HEREIN AND THE COMMON STOCK
ISSUABLE UPON CONVERSION OF THE DEBENTURES HAVE NOT BEEN REGISTERED WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION ("THE COMMISSION") UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED, (THE "ACT") OR THE SECURITIES
COMMISSION OF ANY STATE UNDER ANY STATE SECURITIES LAW. THEY ARE BEING OFFERED
PURSUANT TO A SAFE HARBOR FROM REGISTRATION UNDER REGULATION S ("REGULATION S")
PROMULGATED UNDER THE ACT . THE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE UNITED STATES OR TO A U.S. PERSON (AS SUCH TERM IS DEFINED IN
REGULATION S) UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT AND APPLICABLE
STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE MADE PURSUANT TO
AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
THIS SUBSCRIPTION AGREEMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, ANY OF THE SECURITIES OFFERED HEREBY TO ANY
PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION WOULD BE
UNLAWFUL. INVESTMENT IN SUCH SECURITIES INVOLVES A HIGH DEGREE OF RISK. IN
MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF
THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND THE RISKS
INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED, APPROVED OR DISAPPROVED BY
ANY U.S. FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY.
FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT REVIEWED, PASSED UPON, CONFIRMED
OR DETERMINED THE ACCURACY OR ADEQUACY OF THIS DOCUMENT OR ANY INFORMATION
PROVIDED BY THE COMPANY TO POTENTIAL INVESTORS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
This Securities Subscription Agreement (the "Agreement") is executed by
the undersigned (the "Subscriber") in connection with the offering (the
"Offering") and subscription by the undersigned for 10% Convertible Debentures
(the "Debentures") of Unigene Laboratories, Inc. (the "Company"), due on March
4, 1999, and offered in denominations of at least $50,000 and integral multiples
of $10,000 in excess thereof up to a maximum aggregate principal amount of
$9,080,000. The terms of the Debentures, including the terms on which the
Debentures may be converted into common stock, $.01 par value, of the Company
(the "Common Stock"), are set forth in the Debenture, in the form attached
hereto as Exhibit A. The solicitation of this subscription and, if accepted by
the Company, sale of Debentures, are being made in reliance upon the provisions
of Regulation S. The Company may be subject to NASD regulatory restrictions
regarding the number of shares that may be issued upon conversion of the
Debentures (see Section 6.13 below and the Risk Factors referred to in Section
2.3). The Debentures, and the shares of Common Stock issuable upon conversion
thereof (the "Shares"), are sometimes referred to herein collectively as the
"Securities." The Subscriber wishes to subscribe for Debentures in the amount
set forth in Section 19 in accordance with the terms and conditions of the form
of Debenture and this Agreement. It is agreed as follows:
1. Offer to Subscribe; Purchase Price; Closing; Placement Fees; and
Conditions to
Subscriber's Obligations.
1.1 Offer to Subscriber; Purchase Price. Subject to satisfaction of the
conditions to closing set forth below, the Subscriber hereby subscribes
for and agrees to purchase the aggregate principal amount of Debentures
for a purchase price set out in Section 19 of this Agreement.
1.2 Closing. The closing of the sale and purchase of the Debentures
("Closing") will occur upon (i) the satisfaction of all conditions
described in this Agreement, (ii) sale in this Offering of at least
$6,000,000 of aggregate principal amount of Debentures (the "Minimum
Amount"), and no more than $9,080,000 of aggregate principal amount of
Debentures (the "Maximum Amount"), and (iii) the satisfaction of all
conditions required by the Escrow Agreement ("Escrow Agreement",
defined as the agreement between the Company, Swartz Investments, LLC
("Placement Agent ") and First Union National Bank ("Escrow Agent")
regarding this Offering). As soon as the subscriptions for at least the
Minimum Amount have been accepted by the Company, according to the
terms of this Agreement, the Company shall close on the Minimum Amount.
Thereafter, the Company may conduct one or more additional Closings
until the Maximum Amount has been reached.
1.3 Placement Fees. The parties hereto acknowledge that the Placement
Agent for this Offering will be compensated by the Company in cash and
warrants to purchase Common Stock of the Company. The Placement Agent
has acted solely as placement agent in connection with the Offering by
the Company of the Debentures pursuant to this Agreement. The
information and data contained in the Disclosure Documents (as defined
in Section 2.2 below) and Risk Factors (as defined in Section 2.3
below) have not been subjected to independent verification by Placement
Agent, and no representation or warranty is made by Placement Agent as
to the accuracy or completeness of the information contained in the
Disclosure Documents and Risk Factors.
1.4 Conditions to Subscriber's Obligations. The Subscriber's
obligations hereunder are further conditioned upon the following:
(i) the Common Stock is listed on the National Association of
Securities Dealers, Inc.'s NASDAQ National Market System or
Small Cap Market ("Nasdaq");
(ii) the representations and warranties of the Company are
true and correct in all material respects on the Closing Date
as if made on such date, and the Company shall deliver a
certificate, signed by an officer of a Company, to such effect
to the Escrow Agent;
(iii) there have been no material adverse changes in the
Company's business prospects or financial condition since the
date of the Company's balance sheet dated September 30, 1995;
and
(iv) the following documents shall have been deposited with
the Escrow Agent: the Registration Rights Agreement, the
Opinion of Counsel and the Debenture;
2. Representations and Covenants; Access to Information; Independent
Information; Independent Investigation
2.1 Offshore Transaction.
The Subscriber represents and warrants to the Company that (i)
the Subscriber is not a U.S. person ("U.S. person") as that
term is defined in Rule 902(o) of Regulation S (a copy of
which definition is attached as Exhibit B) and which
definition includes, without limitation, a corporation or
partnership that is organized under the laws of a jurisdiction
other than the United States if it is formed by a U.S. person
principally for the purpose of investing in securities not
registered under the Act, unless it was organized or
incorporated, and is owned, by accredited investors (as
defined in Rule 501(a) of Regulation D under the Act) who are
not natural persons, estates or trusts; (ii) the Securities
were not offered to the Subscriber in the United States and at
the time of execution of this Subscription Agreement and the
time of any offer to the Subscriber to purchase the Securities
hereunder, the Subscriber was physically outside the United
States; (iii) the Subscriber is purchasing the Securities for
its own account and not on behalf of or for the benefit of any
U.S. person and the sale and resale of the Securities have not
been prearranged with any U.S. person or buyer in the United
States; (iv) the Subscriber agrees, and to the knowledge of
the Subscriber, without any independent investigation, each
distributor, if any, participating in the offering of the
Securities, has agreed, that all offers and sales of the
Securities prior to the expiration of a period commencing on
the date of the last Closing of a sale and purchase of
Debentures pursuant to the Offering (the "Last Closing") and
ending forty days thereafter (the "Restricted Period") shall
not be made to U.S. persons or for the account or benefit of
U.S. persons and shall otherwise be made in compliance with
the provisions of Regulation S; and (v) Subscriber is not an
underwriter, dealer, distributor or other person who is
participating, pursuant to a contractual arrangement, in the
distribution of the Securities offered or sold in reliance on
Regulation S.
2.2 Subscriber's Independent Investigation. The Subscriber, in
offering to subscribe for the Securities hereunder, has relied
solely upon (i) an independent investigation made by it and
its representatives, if any, and (ii) the representation,
warranties and disclosures of the Company set forth herein and
in the Disclosure Documents (as defined below). Subscriber
has, prior to the date hereof, been given the opportunity to
examine all material contracts and documents of the Company
which have been filed as exhibits to the Company's filings
made under the Act and the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). In making its investment
decision to purchase the Debentures, the Subscriber is not
relying on any oral or written representations or assurances
from the Company or any other person other than as set forth
in this Agreement, or on any information other than that
contained or incorporated by reference in this Agreement and
in written information, if any, prepared by the Company and
supplied to the Subscriber by the Company in connection
herewith or in the Company's (i) Annual Report on Form 10-KSB
for the year ended December 31, 1994 and (ii) Quarterly Report
on Form 10-QSB for the quarter ended September 30, 1995
(collectively, the "Disclosure Documents"). The Subscriber has
such experience in business and financial matters that it is
capable of evaluating the risk of its investment and
determining the suitability of its investment. The Subscriber
is an accredited investor as defined in Rule 501 of Regulation
D, a copy of which definition is attached hereto as Exhibit C.
2.3 Subscriber's Economic Risk. The Subscriber understands and
acknowledges that an investment in the Securities involves a
high degree of risk. Subscriber acknowledges that there are
limitations on the liquidity of the Securities. The Subscriber
represents that the Subscriber is able to bear the economic
risk of an investment in the Securities, including a possible
total loss of investment. In making this statement the
Subscriber hereby represents and warrants to the Company that
the Subscriber has adequate means of providing for the
Subscriber's current needs and contingencies; that Subscriber
is able to afford to hold the Securities for an indefinite
period; and that Subscriber has such knowledge and experience
in financial and business matters that the Subscriber is
capable of evaluating the merits and risks of the investment
in the Securities. Further, the Subscriber represents, as of
the date of signing this Agreement, that the Subscriber has no
present need for liquidity in the Securities and the
Subscriber is willing to accept such investment risks.
Subscriber has reviewed the Disclosure Documents, including
without limitation the Risk Factors set forth at Exhibit D,
prior to subscribing for any Debentures.
2.4 No Government Recommendation or Approval. The Subscriber
understands that no United States federal or state agency, or
similar agency of any other country, has reviewed, approved,
passed upon or made any recommendation or endorsement of the
Company, the Offering or the subscription for the Securities.
2.5 No Directed Selling Efforts in Regard to this Transaction. To
the knowledge of the Subscriber, without any independent
investigation, neither the Company, Placement Agent nor any
other distributor (if any) participating in the Offering, nor
any person acting for the Company, Placement Agent or any such
distributor, has conducted any "directed selling efforts" in
the United States as the term "directed selling efforts" is
defined in Rule 902(b) of Regulation S, which in general,
means any activity undertaken for the purpose of, or that
could reasonably be expected to have the effect of,
conditioning the market in the United States for any of the
Securities being offered in reliance on Regulation S. Such
activity includes, without limitation, the mailing of printed
material to investors residing in the United States, the
holding of promotional seminars in the United States, and the
placement of advertisements with radio or television stations
broadcasting in the United States or in publications with a
general circulation in the United States, that refers to the
offering of the Securities in reliance on Regulation S.
2.6 Company's Reliance on Representations of Subscribers. This
Agreement is made by the Company with each Subscriber in
reliance upon such Subscriber's representations and covenants
made in this Section 2, which reliance by his, her or its
execution of this Agreement the Subscriber hereby confirms.
2.7 Securities Not Registered Under the Act or Any State Act.
Subscriber understands that the Debentures and the Common
Stock issuable upon conversion of the Debentures have not been
registered under the Act or any state securities laws ("State
Acts") and are being offered and sold pursuant to Regulation S
based in part upon the representations of Subscriber contained
herein. The Common Stock does, however, carry certain
registration rights as set forth in the Registration Rights
Agreement, in the form of Exhibit Q (see Section 7.4 below)
executed by the parties hereto.
2.8 No Public Solicitation. Subscriber knows of no public
solicitation or advertisement of an offer in connection with
the proposed issuance and sale of the Securities.
2.9 Investment Intent. Subscriber is acquiring the Debentures to
be issued and sold hereunder (and the Shares issuable upon
conversion of the Debentures) for his, her or its own account
(or a trust account if such Subscriber is a trustee) for
investment and not as a nominee and not with a view to the
distribution thereof. Subscriber understands that Subscriber
must bear the economic risk of this investment indefinitely
unless such Debentures or such Shares are registered pursuant
to the Act and any applicable State Acts, or an exemption from
such registration is available, and that the Company has no
present intention of registering any such sale of the
Debentures or Shares other than as contemplated by the
Registration Rights Agreement. Subscriber represents and
warrants to the Company, as of the date of this Agreement,
that Subscriber has no present plan or intention to sell the
Debentures or the Shares in the United States at any
predetermined time, and has made no predetermined arrangements
to sell the Debentures or the Shares. Subscriber covenants
that neither Subscriber nor its affiliates nor any person
acting on its or their behalf has entered into, has the
intention of entering into, or will enter into any put option,
short position or other similar instrument, contract,
arrangement or position with respect to the Debentures or
Common Stock of the Company anytime after the earlier of (i)
the time Subscriber first received the term sheet (the "Term
Sheet") concerning this Offering and (ii) the time that
Subscriber was first notified by Placement Agent of the
existence of the Offering (the earlier of which is referred to
as the "Time of Notification of the Offering") until the end
of the Restricted Period, or at any time for the intended
purpose of lowering the price at which the Debentures are
convertible into Shares; and neither Subscriber nor any of its
affiliates nor any person acting on its or their behalf will
at any time use Shares acquired upon conversion of the
Debentures to settle/cover any put option, short position or
other similar instrument, contract, arrangement or position
entered into prior to the end of the Restricted Period.
2.10 Subscriber Not to Sell or Transfer Securities in Violation of
the Securities Laws. Subscriber covenants that he, she or it
will not knowingly make any sale, transfer or other
disposition of the Debentures or the Shares in violation of
the Act (including Regulation S), the Exchange Act, any
applicable State Acts or the rules and regulations of the
Commission or of any state securities commissions or similar
state authorities promulgated under any of the foregoing.
2.11 Subscriber's Power and Authority. Subscriber has the full
power and authority to execute, deliver and perform this
Agreement. This Agreement, when executed and delivered by
Subscriber, will constitute a valid and legally binding
obligation of Subscriber, enforceable in accordance with its
terms.
2.12 Signatory's Representation. The signatory to this Agreement
hereby represents and warrants that he, she or it is either:
(a) not a U.S. person (as defined in Regulation S), and is not
located in the U.S. at the time of signing this Agreement, or
(b) a professional fiduciary of Subscriber (as described in
Section (o)(2) through
(o)(4) of Rule 902 of Regulation S), acting solely in his
capacity as holder of such account, as a fiduciary, executor,
administrator, or trustee, and has completed and signed the
accompanying Certificate (Exhibit E) and forwarded it to
Placement Agent.
2.13 No Tax Advice From Company or Its Agents. Subscriber has had
an opportunity to review with his, her or its own tax advisors
the foreign, U.S. federal, state and local tax consequences of
this investment, and the transactions contemplated by this
Agreement. Subscriber is relying solely on such advisors and
not on any statements or representations of the Company or any
of its agents and understands that Subscriber (and not the
Company) shall be responsible for the Subscriber's own tax
liability that may arise as a result of this investment or the
transactions contemplated by this Agreement.
2.14 No Legal Advice from Company or Its Agents. Subscriber
acknowledges that he, she, or it has had the opportunity to
review this Agreement and the transactions contemplated by
this Agreement with his, or her or its own legal counsel.
Subscriber is relying solely on such counsel and not on any
statements or representations of the Company or any of its
agents for legal advice with respect to this investment or the
transactions contemplated by this Agreement, except for the
representations, warranties and covenants set forth herein and
on the opinion provided for in paragraph 7.3 herein.
2.15 Offering Material Statements. Subscriber acknowledges that all
offering materials and documents received by it in connection
with the offers and sales of the Securities included
statements to the effect of those contained in the first
legend set forth on the first page of this Agreement
2.16 No Scheme to Evade Registration. Subscriber's acquisition of
the Debentures is not a transaction (or any element of a
series of transactions) that is part of a plan or scheme to
evade the registration provisions of the Act.
3. Resales of Securities by Subscriber
Subscriber acknowledges, covenants and agrees that the
Securities may and will only be resold by it (a) in compliance with Regulation S
and applicable State Acts, if any; or (b) pursuant to an exemption from
registration under the Act and applicable State Acts after the Restricted
Period; or (c) pursuant to an effective and current Registration Statement under
the Act. In addition, in connection with any resale of the Debentures in
accordance with clause (a) or (b), above, the Subscriber will deliver to the
Company and will cause the purchaser to deliver to the Company the documents
described in Section 3.1 and 3.2 below, respectively:
3.1. Documents to be Delivered for Offshore Regulation S Resales.
If any Debenture is being resold to an offshore purchaser in
compliance with Regulation S:
1. Sales Agreement, executed by Subscriber and the
purchaser (in the form of Exhibit F);
2. Seller Representation Letter (in the form of
Exhibit G);
3. Assignment Separate from Certificate (in the form
of Exhibit H)(or endorsed Certificates);
4. Seller's Instruction Letter (in the form of
Exhibit I); and
5. Purchaser Representation Letter (in the form of
Exhibit J).
3.2 Documents to be Delivered for Resales into the United States.
If any Debenture is being resold to a purchaser in the U.S.
after the Restricted Period:
1. Sales Agreement, executed by both Subscriber and
the purchaser (in the form of Exhibit F);
2. Seller Representation Letter (in the form of
Exhibit K);
3. Assignment Separate from Certificate (in the form
of Exhibit H)(or endorsed Certificates);
5. Seller's Instruction Letter (in the form of
Exhibit I); and
6. Purchaser Representation Letter (in the form of
Exhibit J).
Upon receipt of the executed documents listed above, the Company will
effect the transfer of the Debentures on the Company's books and will issue and
deliver new Debentures in the purchaser's name (and, in the case of a resale
pursuant to Section 3.2 after the Restricted Period, free of any restrictive
legend restricting transfer under the Act) within three (3) business days of
such receipt. The provisions of this Section 3 shall not apply to subsequent
resales of Debentures that have previously been sold by Subscriber in compliance
with this Section 3.
4. Legends; Subsequent Sale of Securities
4.1 Debenture Legend. The Debenture shall bear a legend
substantially in the form of the first legend set forth on the
first page of this Agreement (the "Regulation S Restrictive
Legend") and any other legend or legends as reasonably
required to comply with U.S. federal, state or foreign law.
4.2 The Shares Obtained Upon Conversion Shall Not Bear a
Restrictive Legend. Assuming that there are no changes in the
material facts set forth in Section 2 of this Agreement or
applicable law from the date hereof until the Date of
Conversion (as that term is defined in the Debentures) of the
Debentures by Subscriber, the Shares obtained upon a
conversion after the Restricted Period shall not bear any
restrictive legend restricting transfer under the Act, nor
shall any stop order be placed on the books of the Transfer
Agent, provided that the Subscriber delivers to the Company a
Certificate in the form of Exhibit L.
4.3 Removal of Debenture Legend for Pledge With a Margin Account.
Upon the submission, at any time after the expiration of the
Restricted Period, by Subscriber of a written request for
removal of the Regulation S Restrictive Legend for the purpose
of a bona fide pledge or deposit of Debentures with a margin
account, together with the Debentures for which legend removal
is being requested and a Certificate in the form of Exhibit M,
the Company shall immediately re-issue the Debentures without
any restrictive legend restricting transfer under the Act, or
the Company shall irrevocably instruct its designated transfer
agent ("Transfer Agent") to do so, assuming that there are no
changes in the material facts set forth in Section 2 of this
Agreement or applicable law from the date hereof until the
date of such submission. Except for the requirements otherwise
set forth in this Agreement, and assuming there are no changes
after the date hereof in the material facts set forth in
Section 2 of the Agreement or applicable law, no action other
than as set forth in this Section 4.3 shall be required of the
Subscriber to remove the Regulation S Restrictive Legend
(unless such pledge or deposit would constitute a violation of
securities law).
4.4 The Company's Instructions to Transfer Agent. The Company will
issue to its Transfer Agent an irrevocable instruction letter
(the "Irrevocable Instructions to Transfer Agent") to convert
the Subscriber's Debentures to Common Stock (in accordance
with the Debenture and, so long as Section 4.2 is complied
with, free of any restrictive legend restricting transfer
under the Act) upon receipt of a valid Notice of Conversion
from a Subscriber and the original Debentures, and such other
documents as are required by this Agreement or the Debenture.
5. Issuance of Securities in the Near Future; Notice Requirements
The Company shall not issue any debt or equity securities for cash in
private capital raising transactions ("Future Offerings") for a period
of seventy five (75) days after the Last Closing without obtaining the
prior written approval of Subscribers holding a majority of the
principal amount of Debentures then outstanding, provided that the
preceding shall not limit the Company's right to conduct a public
secondary offering. The Company will not conduct any Future Offerings
for a period of two hundred and forty (240) days after the Last Closing
without delivering to the Subscriber prior written notice of its intent
to conduct a Future Offering (a "Future Offering Notice") setting forth
the material terms of the proposed Future Offering. For a period of ten
(10) days, commencing on the date of receipt of such Future Offering
Notice (the "Offer Period"), the Subscriber shall have the right
irrevocably to commit to purchase the Subscriber's Portion (as that
term is defined below) of the securities being offered in the Future
Offering on the terms contained in the Future Offering Notice. If,
during the Offer Period, the Subscriber fails irrevocably to commit to
purchase the Subscriber's Portion of the securities that are the
subject of the Future Offering Notice, the Company shall be permitted
to offer and sell any such securities, on terms generally no less
favorable to the Company than are set forth in the Future Offering
Notice, to any third party during a period of ninety (90) days
following the termination of the Offer Period after which 90 day period
the terms of this Section 5 shall again apply (the limitations referred
to in the preceding sentences of this Section 5 are collectively
referred to as the "Capital Raising Limitation"). The Capital Raising
Limitation shall not apply to any transaction involving the Company's
commercial banking arrangements or issuances of securities in
connection with a merger, consolidation or sale of assets, or in
connection with or as part of the same transaction as a joint venture
or other acquisition or disposition of a business, a product or a
license by the Company, or exercise of options by employees,
consultants or directors or any transaction with a strategic corporate
partner or to loan securitization or sales of loans to master trusts.
The Capital Raising Limitation also shall not apply to the issuance of
securities upon exercise or conversion of the Company's options,
warrants or other convertible securities outstanding as of March 5,
1996, or to the grant of additional options or warrants, or the
issuance of additional securities, under any Company stock option or
restricted stock plan. The amount of securities which a Subscriber is
entitled to purchase in such a Future Offering (the "Subscriber's
Portion") shall be a number obtained by multiplying the aggregate
amount of securities being offered in the Future Offering by a
fraction, the numerator of which is the aggregate principal amount of
Debentures purchased by the Subscriber pursuant to this Agreement and
the denominator of which is the aggregate principal amount of
Debentures placed in the Offering. If the Company fails to obtain from
purchasers of Debentures in the Offering irrevocable commitments to
purchase 90% of the proposed Future Offering, the Company shall be
released from any obligation under this Section 5 to the Subscribers
with respect to such Future Offering.
6. Representations and Warranties of Company
Company represents and warrants to Subscriber as follows:
6.1 Organization, Good Standing, and Qualification. The Company is
a corporation duly organized, validly existing and in good
standing under the laws of state of Delaware and has all
requisite corporate power and authority to carry on its
business as now conducted and as proposed to be conducted. The
Company is duly qualified to transact business and is in good
standing in each jurisdiction in which the failure to so
qualify would have a material adverse effect on the business
or properties of the Company and its subsidiaries taken as a
whole. The Company, is not the subject of any pending or, to
its knowledge, threatened investigation or administrative or
legal proceeding by the Internal Revenue Service, the taxing
authorities of any state or local jurisdiction, or the
Securities and Exchange Commission which could have a material
adverse effect and which have not been disclosed in the
reports referred to in Section 2.2 above.
6.2 Corporate Condition. The Company's condition was, in all
material respects, as described in the Disclosure Documents at
the respective dates thereof. There has been no material
adverse change in the Company's business financial condition
or prospects since September 30, 1995. The Disclosure
Documents are true and correct, in all material respects, and
the financial statements contained in the Disclosure Documents
have been prepared in accordance with generally accepted
accounting principles, consistently applied, and fairly
present the financial position and results of operation and
cash flows of the Company on a consolidated basis, for the
periods then ended. Without limiting the foregoing, there are
no material liabilities, contingent or actual, that are not
disclosed in the Disclosure Documents. The Company has paid
all material taxes which are due, except for taxes which it
reasonably disputes. There is no material claim, litigation,
or administrative proceeding pending, or to the best of the
Company's knowledge, threatened against the Company, except as
disclosed in the Disclosure Documents. This Agreement and the
Disclosure Documents do not contain any untrue statement of a
material fact and do not omit to state any material fact
required to be stated therein or herein or necessary to make
statements contained therein or herein not misleading in the
light of the circumstances under which they were made.
6.3 Authorization. All corporate action on the part of the Company
by its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement, the
performance of all obligations of the Company hereunder and
the authorization, issuance and delivery of the Debentures
being sold hereunder and issuance (and reservation for
issuance) of the Common Stock obtainable on conversion of the
Debentures have been taken, and this Agreement and the
Registration Rights Agreement constitute valid and legally
binding obligations of the Company, enforceable in accordance
with their terms. The Company has obtained all consents and
approvals required for it to execute, deliver, and perform
this Agreement. The Company is not in violation or default of
any provisions of its Articles of Incorporation or By-laws, as
amended and in effect on and as of the date of this Agreement,
or of any material provision of any instrument or contract to
which it is a party or by which it is bound or of any material
provision of any federal or state judgment, writ, decree,
order, statute, rule or governmental regulation applicable to
the Company except where such violation, default or conflict
would have no material adverse affect on the Company's
business prospects or financial condition, or on the
transaction contemplated herein. The execution, delivery and
performance of this Agreement and the consummation of the
transactions contemplated hereby will not result in any such
violation or be in conflict with or constitute, with or
without the passage of time and giving of notice, either a
default under any such provision, instrument or contract or an
event which results in the creation of any lien, charge or
encumbrance upon any assets of the Company.
6.4 Valid Issuance of Securities. The Debentures, when issued,
sold and delivered in accordance with the terms hereof for the
consideration expressed herein, will be validly issued and
binding obligations of the Company, enforceable in accordance
with their terms, and, based in part upon the representations
of the Subscriber in this Agreement, will be issued in
compliance with all applicable U.S. federal and state
securities laws. The Common Stock issuable upon conversion of
the Debentures, when issued in accordance with the terms of
the Debentures, shall be duly and validly issued and
outstanding, fully paid and nonassessable, and based in part
on the representations and warranties of Subscriber of the
Debentures, will be issued in compliance with all applicable
U.S. federal securities laws and State Acts. The Shares will
be issued free of any preemptive right. The Company currently
has at least 4.8 million shares reserved for issuance upon
conversion of the Debentures.
6.5 Current Public Information. The Company represents and
warrants to the Subscriber that the Company is a "reporting
issuer" as defined in Rule 902(1) of Regulation S and it has a
class of securities registered under Section 12(b) or 12(g) of
the Exchange Act or is required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act, and has filed all the
materials required to be filed as reports pursuant to the
Exchange Act for a period of at least twelve months preceding
the date hereof (or for such shorter period as the Company was
required by law to file such material), and all such filings
have been made on a timely basis. The Company undertakes to
furnish the Subscriber with copies of such information as may
be reasonably requested by the Subscriber prior to
consummation of this Offering.
6.6 No Securities Offered in U.S. or to any U.S. Person. The
Company represents that it has not offered the Debentures to
the Subscriber in the U.S. or to any person in the United
States or any U.S. person (as defined in Regulation S) unless
such U.S. person is a professional fiduciary of a non-U.S.
person (as defined in Section (o) (2) through (o) (4) of Rule
902 of Regulation S).
6.7 No Directed Selling Efforts in Regard to this Transaction.
Neither the Company, nor to the knowledge of the Company, the
Placement Agent, any other distributor participating in the
Offering (if any), or any person acting for the Company, the
Placement Agent or any such distributor, has conducted any
"directed selling efforts" in the United States, as the term
"directed selling efforts" is defined in Rule 902(b) of
Regulation S with respect to the Offering, which in general,
means any activity undertaken for the purpose of, or that
could reasonably be expected to have the effect of,
conditioning the market in the United States for any of the
Securities being offered in reliance upon Regulation S. Such
activity includes, without limitation, the mailing of printed
material to investors residing in the United States, the
holding of promotional seminars in the United States, and the
placement of advertisements with radio or television stations
broadcasting in the United States or in publications with a
general circulation in the United States, that refers to the
offering of the Securities.
6.8 Capitalization Structure of the Company. The capitalization of
Company, as of the date of the Closing, after giving effect to
the issuances of the Securities in this Offering, is as set
forth in Exhibit N.
6.9 Termination Date of Offering. In no event shall the Last
Closing of a sale of a Debenture in connection with the
Offering, occur later than March 15, 1996, which date can be
extended by up to 10 days upon written approval by the Company
and the Placement Agent.
6.10 Use of Proceeds. As of the date hereof, the Company expects to
use the proceeds from this Offering (less fees and expenses)
for the purposes and in the approximate amounts set forth in
Exhibit O hereto. These purposes and amounts are estimates and
are subject to change.
6.11 Intellectual Property. The Company has a valid unrestricted,
enforceable and exclusive license for the use of all patents,
trademarks, trademark registrations, trade names, copyrights,
trade secrets, know-how, technology and other intellectual
property necessary to the conduct of its business, except to
the extent such rights have been licensed, assigned or
otherwise transferred to others, as indicated on Schedule
IP-1. To the best of the Company's knowledge, the Company is
not infringing on the intellectual property rights of any
third party, nor is any third party infringing on the
Company's intellectual property rights. There are no
restrictions in any agreements, licenses, franchises, or other
instruments that are necessary for the conduct of the
Company's business as presently conducted or as planned to be
conducted in the future that materially interfere with the
conduct of such business.. The Company has granted valid and
enforceable licenses to others as listed on Schedule IP-1.
6.12 Levy Family Loan Repayment. The outstanding Levy family loans
may be repaid out of the proceeds of the Offering according to
the following schedule of repayment preconditions and in the
following limited monthly amounts:
Repayment Maximum
Repayment Precondition Tranche Monthly Repayment
1. GMP Status Achieved $250,000 $125,000
2. Filing of Injectable Calcitonin IND $250,000 $125,000
3. Filing of Oral Calcitonin IND $250,000 $125,000
4. Contract with a "Strategic Marketing
Partner" (as defined below) $500,000 $250,000
Repayments shall become permissible as of the beginning of the
calendar month immediately following the month in which the
specified precondition is satisfied. During any one month,
repayment may only be made towards one eligible "Repayment
Tranche". If an additional Repayment Tranche becomes eligible
during a month an initial Repayment Tranche is already being
repaid, repayment under the additional Repayment Tranche shall
be delayed until the calendar month immediately following
repayment in full of the initial Repayment Tranche.
Strategic Marketing Partner: Strategic Marketing Partner shall
mean any person or entity which has entered into an agreement
with the Company which provides (a) that such person or entity
will arrange for the marketing, manufacturing and/or
distribution services for the Company's amidated peptide
products developed and/or manufactured utilizing the Company's
proprietary technology and (b) that such person or entity
will, at the Company's discretion, (1) make an aggregate
payment of at least $2,000,000 to the Company in up-front fees
and/or scheduled already known fixed payments over the term of
the agreement or (2) if the marketing territory covered by the
agreement includes one or more of the United States, Japan, or
any European country, pay the Company at least a 5% royalty
over the term of the agreement.
6.13 Shareholder Approval. The Company covenants to submit to its
shareholders at its next annual shareholder meeting a proposal
for ratification of the issuance of the Debentures and the
Common Stock issuable upon conversion thereof. The Company
further covenants to use it best efforts to have such proposal
approved by the necessary shareholder vote, if and as required
by the rules of the National Association of Securities
Dealers, Inc. (the "NASD") applicable to the transaction.
Neither the failure to obtain stockholder approval nor the
Company's lack of financial ability to redeem Debentures will
release the Company from its contractual obligations to issue
unrestricted and unlegended shares of Common Stock, in
accordance with the terms of the Debentures and this
Agreement, upon the conversion of the Debentures.
7. Covenants of Company
7.1 Independent Auditors. The Company shall, until at least
February 28, 1999, maintain as its independent auditors an
accounting firm authorized to practice before the Commission.
7.2 Corporate Existence and Taxes. The Company shall, until at
least the earlier of March 5, 1999, and the conversion or
redemption of all the Debentures purchased pursuant to this
Agreement maintain its corporate existence in good standing
(provided, however, that the foregoing covenant shall not
prevent the Company from entering into any merger or corporate
reorganization as long as the surviving entity in such
transaction, if not the Company, assumes the Company's
obligations with respect to the Debentures) and shall pay all
its material taxes when due except for taxes which the Company
reasonably disputes.
7.3 Opinion of Counsel. Subscriber shall, upon purchase of the
Debentures, receive an opinion letter from outside counsel to
the Company, in the form attached hereto as Exhibit P, to the
effect that (i) the Company is duly incorporated and validly
existing under the laws the state of Delaware; (ii) this
Agreement, the Registration Rights Agreement, the Irrevocable
Instructions to Transfer Agent, the issuance of the
Debentures, and the issuance of the Common Stock upon
conversion of the Debentures have been duly authorized by all
required corporate action, and that all such Shares of Common
Stock, upon delivery, shall be validly issued, fully paid and
nonassessable; (iii) this Agreement, the Registration Rights
Agreement, and the Irrevocable Instructions to Transfer Agent
constitute valid and binding obligations of the Company,
enforceable in accordance with their terms, except as
enforceability of any indemnification provisions may be
limited by principles of public policy, and subject to laws of
general application relating to bankruptcy, insolvency and the
relief of debtors and rules of laws governing specific
performance and other equitable remedies; (iv) based upon the
representations and warranties of the Subscribers contained in
the Regulation S Subscription Agreements entered into in
connection with the Offering and the representations and
warranties of the Placement Agent set forth in the Manner of
Offering Certificate of the Placement Agent, and assuming that
no Subscriber is engaged in a plan or scheme to evade the
registration requirements of the Act, the issuance of the
Debentures has been effected in compliance with Regulation S,
and the issuance of the Shares upon conversion of the
Debentures in accordance with their terms by the Subscriber
(assuming that no commission or other remuneration is paid or
given, directly or indirectly, for soliciting such conversion)
will not be subject to the registration provisions of the Act;
and (v) the execution, delivery and performance of this
Agreement and the other agreements entered into in connection
herewith, does not conflict with or result in a breach of the
Company's Articles of Incorporation, By-laws, or any
agreement, relating to the issuance of securities, the
incurrence of funded indebtedness or registration rights, to
which the Company is a party or by which its property is bound
or any judgment, or decree to which it is subject, that is
identified to such counsel by the Company.
7.4 Registration Rights. The Company will grant Subscriber the
registration rights covering the Common Stock issuable on
conversion of the Debentures on the terms of the Registration
Rights Agreement attached hereto as Exhibit Q.
7.5 Notification of Final Closing Date & Restricted Period by
Company. Within five (5) business days after the Last Closing,
the Company shall notify the Subscriber in writing that the
Last Closing has occurred, the date of the Last Closing, the
date upon which the Restricted Period will terminate with
respect to the Securities, the dates that the Subscribers are
entitled to convert the respective portions of their
Debentures and the Fixed Conversion Price, as that term is
defined in the Debenture.
7.6 Payments for Late Conversion or Failure to Reserve Authorized
but Unissued Common.
(a) Payments for Late Conversion. As set forth in the
Debentures, the Transfer Agent or the Company (as applicable)
shall, no later than 6:00 P.M. (New York City time) on the
third business day (the "Deadline") after receipt by the
Company or its Transfer Agent of a notice of conversion and
all necessary documentation duly executed and in proper form
required for conversion, including receipt by the Transfer
Agent of the original Debentures to be converted, all in
accordance with the terms of the Debentures and this
Agreement, issue a certificate for the number of shares of
Common Stock to which the holder ("Holder") of the Debentures
shall be entitled as aforesaid and surrender such original
Common Stock certificates to a common courier for either
overnight or (if delivery is outside the United States) 2-day
delivery to the Holder at the address of the Holder on the
books of the Company. The Company understands that a delay in
the issuance and delivery of the Shares of Common Stock beyond
the Deadline could result in economic loss to the Holder. As
compensation to the Holder for such loss, the Company agrees
to pay late payments to the Holder for late issuance of Shares
upon conversion in accordance with the following schedule
(where "No. Business Days Late" is defined as the number of
business days beyond the Deadline):
Late Payment For Each
$10,000 Of Debenture Principal
No. Business Days Late Amount Being Converted
---------------------- ----------------------
1 $100
2 $200
3 $300
4 $400
5 $500
6 $600
7 $700
8 $800
9 $900
10 $1,000
greater than 10 $1,000 + $200 for each
Business Day Late
beyond 10 days
In the event that the number of shares of Common Stock that
the Company reasonably calculates to be due a particular
Subscriber upon conversion is different from the number of
shares claimed by the Subscriber, by virtue of the calculation
of the conversion rate or other information set forth in its
Notice of Conversion, the Company shall direct the Transfer
Agent to issue, in accordance with the procedures set forth
above and in the Debentures, to the Subscriber certificates
for a number of shares equal to the lesser of the two numbers
and, as to the issuability of the remaining disputed number of
shares of Common Stock, shall submit the dispute within three
business days after the receipt of such Holder's Notice of
Conversion to the Company's usual outside accounting firm
("Accountant") for determination of the number of shares of
Common Stock to be issued. In the event of such a dispute, the
Company agrees to instruct its Accountant, at the Company's
expense, to resolve any such dispute and notify the parties of
the result within three business days after the Accountant's
receipt of notice of such dispute. Within two business days of
its receipt of the Accountant's results, the Company shall
direct the Transfer Agent to issue to the Subscriber
certificates for any additional shares (the "Disputed Shares")
to which the Subscriber is entitled. The Disputed Shares shall
not be subject to the late payment provisions of this Section
7.6(a).
To the extent that the failure of the Company to issue the
Common Stock pursuant to this Section 7.6 is due to the
unavailability of authorized but unissued shares of Common
Stock, the provisions of this Section 7.6(a) shall not apply
but instead the provisions of Section 7.6(b) shall apply.
The Company shall pay any payments incurred under this Section
7.6(a) in immediately available funds within three (3)
business days from the date of issuance of the applicable
Common Stock. Nothing herein shall limit a Holder's right to
pursue actual damages for the Company's failure to issue and
deliver Common Stock to the Holder pursuant to the terms of
the Debenture.
(b) Payments for Failure to Reserve Authorized but Unissued
Common . If, at any time a Holder of Debentures submits a
Notice of Conversion (as defined in the Debenture), the
Company does not have sufficient authorized but unissued
shares of Common Stock available to effect, in full, a
conversion of the Debentures under Section 4 of the Debenture,
subject to the Company's right to redeem such Debentures in
accordance with the terms thereof (a "Conversion Default", the
date of such default being referred to herein as the
"Conversion Default Date"), the Company shall issue to the
Holder all of the shares of Common Stock which are available,
and the Notice of Conversion as to any Debentures requested to
be converted but not converted (the "Unconverted Debentures")
shall become null and void. The Company shall provide notice
of such Conversion Default ("Notice of Conversion Default") to
each Holder of outstanding Debentures, by facsimile, within
three (3) business days of such default (with the original
delivered by overnight or two (2) day courier). Holders may
not submit a Notice of Conversion after receipt of a Notice of
Conversion Default until the date additional shares of Common
Stock are authorized by the Company.
The Company agrees to pay to all Holders of
outstanding Debentures payments for a Conversion Default
("Conversion Default Payments") in the amount of (N/365) x
(.24) x the initial issuance price of the outstanding
Debentures held by each Holder where N = the number of days
from the Conversion Default Date to the date (the
"Authorization Date") that the Company authorizes a sufficient
number of shares of Common Stock to effect conversion of all
remaining Debentures. The Company shall send notice
("Authorization Notice") to each Holder of outstanding
Debentures, by facsimile, within three (3) business days after
the Authorization Date (with the original delivered by
overnight or two (2) day courier) that additional shares of
Common Stock have been authorized, the Authorization Date and
the amount of Holder's accrued Conversion Default Payments.
The accrued Conversion Default shall be paid in cash or shall
be convertible into Common Stock at the Conversion Rate (as
that term is defined in the Debenture), at the Company's
option, and shall be payable to each Holder of outstanding
Debentures by the fifth day of the following calendar month.
Nothing herein shall limit the Subscriber's right to pursue
actual damages for the Company's failure to maintain a
sufficient number of authorized shares of Common Stock.
7.7 Listing. The Company shall effect, as soon as
practicable following the Closing, subject to Company's right
to redeem such Debentures, the listing of the shares of Common
Stock issuable upon the conversion of the Debentures on Nasdaq
or another national securities exchange or quotation system.
8. Events of Defaults. If any of the following events of default (each
an "Event of Default") shall occur:
8.1 Conversion. The Company fails to issue shares of
Common Stock to the Holder upon exercise by the Holder of the
conversion rights of the Holder in accordance with the terms
of the Debenture and this Agreement fails to transfer any
certificate for shares of Common Stock issued to the Holder
upon conversion of the Debenture and when required by the
Debenture or fails to remove any restrictive legend on any
certificate or any shares of Common Stock issued to the Holder
upon conversion of the Debenture as and when required by the
Debenture or this Agreement and any such failure shall
continue uncured for 10 trading days;
8.2 Breach of Covenant. The Company breaches any
material covenant or other material term or condition of the
Debenture (other than as specifically provided in Section 8.1
hereof), or this Agreement and the breach of which would have
a material adverse effect on the Company or the prospects of
the Company or a material adverse effect on the Holder or the
rights of the Holder with respect to the Debentures or the
shares of Common Stock issuable upon conversion of the
Debentures and such breach continues for a period of ten (10)
business days after written notice thereof to the Company from
the Holder;
8.3 Breach of Representations and Warranties. Any
representation or warranty of the Company made herein or in
any agreement, statement or certificate given in writing
pursuant hereto or in connection herewith shall be false or
misleading in any material respect when made and the breach of
which would have a material adverse effect on the Company or
the prospects of the Company or a material adverse effect on
the Holder or the rights of the Holder with respect to the
Debentures or the shares of Common Stock issuable upon
conversion of the Debentures;
8.4 Receiver or Trustee. The Company or any
subsidiary of the Company shall make an assignment for the
benefit of creditors, or apply for or consent to the
appointment of a receiver or trustee for it or for a
substantial part of its property or business; or such a
receiver or trustee shall otherwise be appointed;
8.5 Judgments. Any money judgment, writ or similar
process shall be entered or filed against the Company or any
subsidiary of the Company or any of its property or other
assets for more than $500,000, and shall remain unvacated,
unbonded or unstayed for a period of thirty (30) days unless
otherwise consented to by the Holder, which consent will not
be unreasonably withheld; or
8.6 Bankruptcy. Bankruptcy, insolvency,
reorganization or liquidation proceedings or other proceeding
for relief under any bankruptcy law or any law for the relief
of debtors shall be instituted by or against the Company or any
subsidiary of the Company and any such proceeding instituted
against the Company or any subsidiary is not dismissed within
thirty (30) days.
Then upon the occurrences and during the continuation of any
Event of Default specified in Section 8.1, 8.2, 8.3, 8.4, 8.5 or 8.6 upon the
written notice of the Holders of 75% of the outstanding principal amount of the
Debentures, the Company shall, and upon the occurrences of any event of default
specified in Section 8.4 or 8.6, the Company shall pay to the Holder an amount
equal to (a) the sum of (1) the unpaid principal amount of the Debentures owned
by such Holder plus (2) accrued and unpaid interest on the unpaid principal
amount of the Debentures owned by such Holder to the date of payment; multiplied
by (b) the percentage (the "Default Percentage") set forth below with respect to
the date on which such Event of Default occurs:
Date of Event of Default Default Percentage
- ------------------------ ------------------
Date of Last Closing to 18 months 130%
following Last Closing
18 months and 1 day to 24 months 125%
following Last Closing
24 months and 1 day to 30 months 120%
following Last Closing
After 30 months following Last Closing 115%
In addition, all other amounts payable hereunder shall
immediately become due and payable, all without demand, presentment, or notice,
all of which hereby are expressly waived, together with all costs, including,
without limitation, legal fees and expenses, of collection to which the Holder
is lawfully entitled, and the Holder shall be entitled to exercise all other
rights and remedies available at law or in equity.
If the Company fails to pay any amounts due pursuant to this
Article 8 within 5 business days of such amounts being due and payable, then the
Holder shall have the right at any time, so long as the Company remains in
default, to require the Company, upon written notice, to immediately issue, in
lieu of such amounts, the number of shares of Common Stock of the Company equal
to the amounts owed by the Company to the Holder, divided by the Conversion
Price then in effect.
9. Governing Law
This Agreement shall be governed by and construed in accordance with
the laws of the state of Delaware, U.S.A. applicable to agreements made in and
wholly to be performed in that jurisdiction, except for matters arising under
the Act or the Exchange Act which matters shall be construed and interpreted in
accordance with such laws. Any action brought to enforce, or otherwise arising
out of, this Agreement shall be heard and determined only in either a federal or
state court sitting in the County of New Castle in the State of Delaware, U.S.A.
10. Entire Agreement; Written Amendments Required
This Agreement, the Debentures, the Registration Rights Agreement, the
Irrevocable Instructions to Transfer Agent (except as set forth therein), the
Escrow Agreement and the other documents delivered pursuant hereto or thereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and thereof, and no party shall be liable or
bound to any other party in any manner by any warranties, representations or
covenants except as specifically set forth herein or therein. Neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument signed by the party against whom enforcement
of any such amendment, waiver, discharge or termination is sought.
11. Written Notices, Etc.
Any notice, demand or request required or permitted to be given by
either the Company or the Subscriber pursuant to the terms of this Agreement
shall be in writing and shall be deemed given when delivered personally, or by
facsimile (with a hard copy to follow by either overnight or two (2) day
courier), addressed to the Subscriber at the address and/or facsimile telephone
number set forth at the end of this Agreement and to Unigene Laboratories, Inc.
at 110 Little Falls Road, Fairfield, New Jersey 07004 (or such other address as
a party may request by notifying the other in writing).
12. Execution in Counterparts Permitted
This Agreement may be executed in any number of counterparts, each of
which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument.
13. Representations and Warranties Survive the Closing;
Agreement is Severable
The Subscriber's and the Company's representations and warranties shall
survive the closing of the transaction notwithstanding any due diligence
investigation made by or on behalf of the party seeking to rely thereon. In the
event that any provision of this Agreement becomes or is declared by a court of
competent jurisdiction to be illegal, unenforceable or void, this Agreement
shall to the extent permitted by law continue in full force and effect without
said provision; provided that no such severability shall be effective if it
materially changes the economic benefit of this Agreement to any party.
14. Titles and Subtitles; Gender
The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or
interpreting this Agreement. The use in this Agreement of a masculine,
feminine or neuter pronoun shall be deemed to include a reference to
the others.
15. Exact Registered Name of Security Holder; Offshore Delivery
Instructions
(a) Subscriber agrees to provide Company with the exact name
in which he, she or it wishes the Securities to be registered by providing that
information on the accompanying signature page of this Agreement. Additionally,
Subscriber also agrees to provide Company with detailed delivery instructions to
an offshore addressee and will also provide that information on the accompanying
signature page of this Agreement.
(b) Subscriber agrees to courier to Company his, her or its
original inked signed Subscription Agreement within 2 days of faxing said signed
Agreement to the Placement Agent.
16. Limitations on Assignment of this Agreement.
Neither party to this Agreement may assign this Agreement without the
prior written consent of the other (which may be withheld for any reason). This
provision does not limit the Subscriber's right to transfer the Securities
pursuant to the terms of the Debenture and this Agreement.
17. Subscription and Wiring Instructions; Irrevocability
(a) Subscriber shall send a copy of its signed Subscription Agreement
by facsimile to Placement Agent at (770) 640-7150, and shall send its
subscription funds by wire transfer, to the Escrow Agent as follows:
First Union National Bank of Georgia
Attn: Rick Schaal
Corporate Trust Administration
999 Peachtree Street, N.E., Suite 1100
Atlanta, Georgia 30309
Fax: 404-827-7305
ABA Number: 053000219
Account Number: 465946
Attn: Claire Moore
Ref: UNIGENE LABORATORIES, INC./Swartz Investments, LLC
Ref: Subscriber's Name
A/C 3072232630
Contact Nicole Stefanini
(b) The Subscriber hereby acknowledges and agrees, subject to the
provisions of any applicable laws providing for the refund of subscription
amounts submitted by the Subscriber, that this Agreement is irrevocable and that
the Subscriber is not entitled to cancel, terminate or revoke this Agreement;
provided, however, that if the conditions to Closing are not satisfied or if the
Disclosure Documents are discovered prior to Closing to contain statements which
are materially inaccurate, or omit statements of material fact, the Subscriber
may revoke or cancel this Agreement.
(c) This Agreement shall be accepted by the Company when the Agreement
is countersigned by the Company and delivered to the Escrow Agent. The
Subscriber hereby confirms that the Company has full right in its sole
discretion to accept or reject the subscription of the Subscriber, in whole or
in part, provided that, if the Company decides to reject such subscription, the
Company must do so promptly and in writing. In the case of rejection, the
Company will promptly return any rejected payments (together with any interest
earned on such rejected funds in the escrow account) and (if rejected in whole)
copies of all executed subscription documents (including without limitation this
Agreement) to Subscriber. The Company may terminate this Agreement prior to the
Closing if this Agreement is discovered to contain statements that are
materially inaccurate or to or omit statements of material fact.
18. Indemnification.
The Company shall indemnify and hold harmless the Subscriber, Placement
Agent and each of their officers, directors, employees, partners, control
persons and agents (a "Subscriber Indemnified Party") who is or may be a party
to any threatened, pending, or completed action, suit or proceeding of any kind,
against any losses, damages, liabilities and expenses (including reasonable
attorneys fees) suffered or incurred by a Subscriber Indemnified Party and not
otherwise reimbursed, arising from or due to any material breach of a
representation warranty or covenant of the Company contained in this Agreement.
The Subscriber shall indemnify and hold harmless the Company and each of its
officers, directors, employees, partners, control persons and agents (a "Company
Indemnified Party") who is or may be a party to any threatened, pending, or
completed action, suit or proceeding of any kind, against any losses, damages,
liabilities and expenses (including reasonable attorneys fees) suffered or
incurred by a Company Indemnified Party and not otherwise reimbursed, arising
from or due to any material breach of a representation, warranty or covenant of
the Subscriber contained in this Agreement.
19. Amount
The undersigned hereby subscribes for _________________________
principal amount of Debentures, and pays herewith funds in the amount of
____________________________ U.S. Dollars ($______________U.S.) on the terms and
conditions of this Agreement.
The undersigned acknowledges that this Agreement and the subscription
represented hereby shall not be effective unless accepted by the Company as
indicated below and delivered to the Subscriber.
Dated this _____ day of ___________, 1996.
- ------------------------------------ ---------------------------------
Your Signature EXACT NAME IN WHICH YOU WANT
THE SECURITIES TO BE REGISTERED
(Please Print Exact Registered Name)
OFFSHORE DELIVERY INSTRUCTIONS:
- ------------------------------------- -----------------------------------
Name: Please Print
Please type or print address where
your security is to be delivered.
ATTN:
----------------------
- ------------------------------------ --------------------------------
Title/Representative Capacity (if applicable) Street Address
- ------------------------------------ --------------------------------
Name of Company You Represent (if applicable) Street Address
- ------------------------------------ --------------------------------
Place of Execution of this Agreement City, State or Province, Country
-----------------------------
Offshore Postal Code
-----------------------------
Phone Number (For Federal Express)
-----------------------------
Facsimile Number (re: Notice)
THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE ____ DAY OF __________ 1996.
UNIGENE LABORATORIES, INC.
By:________________________________
(Signature)
Print Name: _________________________
Title: ______________________________
EXHIBIT E
- UNIGENE LABORATORIES, INC. -
FIDUCIARY, ADMINISTRATOR, EXECUTOR OR TRUSTEE CERTIFICATE
The signatory to this Agreement hereby represents and warrants
that he, she or it is a professional fiduciary of Subscriber
(as described in Section (o)(2) through (o)(4) of Rule 902 of
Regulation S), acting solely in his, her or its capacity as
such, and that:
(i) the Subscriber is not a U.S. person (as defined in
Regulation S); and
(ii) either (sign either A, B or C, as applicable):
A. The account for which the Debentures are being
purchased by Subscriber is a discretionary account or
similar account (other than an estate or trust) which
the undersigned manages and holds for the benefit or
account of Subscriber and the Subscriber is not
located in the U.S. at the time of signing this
Agreement;
----------------- (signature)
OR
B. The account for which the Debentures are being
purchased by Subscriber is the account of an estate
of which the undersigned acts as executor or
administrator, an executor or administrator of the
estate who is not a U.S. person (as defined in
Regulation S) has sole or shared investment
discretion with respect to the assets of the estate,
the estate is governed by foreign law and the
Subscriber is not located in the U.S. at the time of
signing this Agreement;
----------------- (signature)
OR
C. The account for which the Debentures are being
purchased by Subscriber is the account of a trust of
which the undersigned acts as trustee, a trustee, who
is not a U.S. person (as defined in Regulation S) has
sole or shared investment discretion with respect to
the trust assets, no beneficiary of the trust (and no
settlor, if the trust is revocable) is a U.S. person
(as defined in Regulation S) and the Subscriber is
not located in the U.S. at the time of signing this
Agreement.
----------------- (signature)
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Print Your Name Person or Entity for Whom You are Signing