Exhibit 4.1
Final
COMMON STOCK AND WARRANT PURCHASE AGREEMENT
Dated
May 6, 2003
Between
IMPAX LABORATORIES, INC.
And
The
PURCHASERS
This COMMON STOCK AND WARRANT PURCHASE AGREEMENT is dated as of May 6,
2003 between Impax Laboratories, Inc., a Delaware corporation (the "Company"),
and the purchasers listed on Schedule 1 hereto (each, a "Purchaser" and
collectively, the "Purchasers").
W I T N E S S E T H :
WHEREAS, the Company desires to issue and sell to the Purchasers, and
the Purchasers desire to purchase from the Company, shares of the Company's
common stock, par value $.01 per share (the "Common Stock") and warrants to
purchase the Common Stock (the "Warrants") upon the terms and provisions
hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:
SECTION 1. Sale and Purchase of Common Stock and Warrants
(a) The Company agrees to sell to the Purchasers and, subject to the
terms and conditions hereof and in reliance upon the representations and
warranties of the Company contained herein or made pursuant hereto, each
Purchaser agrees, severally and not jointly, to purchase from the Company at the
Closing provided for in Section 2 hereof, the number of shares of Common Stock
and Warrants to purchase the number of shares of Common Stock set forth opposite
such Purchaser's name on Schedule 1 hereto. The shares of Common Stock being
acquired under this Agreement are collectively referred to herein as the
"Shares." The Shares and Warrants being acquired under this Agreement are
collectively referred to herein as the "Securities." The shares of Common Stock
issuable upon exercise of the Warrants being acquired under this Agreement are
collectively referred to herein as the "Warrant Shares."
(b) The aggregate purchase price to be paid to the Company by each
Purchaser for the Securities to be purchased by such Purchaser pursuant to this
Agreement shall be the amount set forth opposite such Purchaser's name on
Schedule 1 hereto. No further payment shall be required from a Purchaser for the
Securities.
(c) The Company will use the net proceeds to be received from the sale
of the Securities and the Warrant Shares for working capital and general
corporate purposes and prior to the first anniversary of the Closing Date will
not use the net proceeds (i) for the satisfaction of any portion of the
Company's debt (other than payment of trade payables, indebtedness under the
Company's existing credit facilities, indebtedness not exceeding $100,000, and
accrued expenses in the ordinary course of the Company's business and prior
practices and other than the payment of up to $22.0 million to Teva
Pharmaceuticals Curacao N.V. or its Affiliates ("Teva") pursuant to the
Strategic Alliance Agreement dated June 27, 2001 (the "Teva Agreement") between
the Company and Teva), (ii) to redeem any Company equity or equity-equivalent
securities (other than to redeem up to 1,462,083 shares of the Company's Common
Stock held by Teva (the "Teva Stock")), or (iii) to settle any outstanding
litigation.
SECTION 2. Closings and Call Option.
2.1 Closing
(a) Subject to the terms and conditions hereof, the closing of the
purchase and sale of the Securities to be purchased by the Purchasers will take
place at the offices of Proskauer Rose LLP, 1585 Broadway, New York, New York
10036 at 10:00 A.M., on May 7, 2003, or such other time and date as shall be
mutually agreed to by the Company and the Purchasers (the "Closing") (such time
and date are herein referred to as the "Closing Date").
(b) Subject to the terms and conditions hereof, at the Closing (i) the
Company will deliver to each Purchaser (A) a certificate registered in the
Purchaser's name (or the name of its nominee, if any, as specified on Schedule 1
hereto) evidencing the number of Shares set forth opposite the Purchaser's name
on Schedule 1, (B) a Warrant in the form attached hereto as Exhibit A registered
in the Purchaser's name (or the name of its nominee, if any, as specified on
Schedule 1 hereto) evidencing the right to purchase the number of shares of
Common Stock set forth opposite the Purchaser's name on Schedule 1, and (C) the
other documents, certificates and opinions to be delivered pursuant to Section 8
hereof and (ii) each Purchaser will deliver to the Company by wire transfer of
federal or other immediately available funds an amount equal to the aggregate
purchase price (as specified in Section 1(b) hereof) for the Securities to be
purchased by such Purchaser.
2.2 Call Option
(a) The Company hereby grants to each Purchaser an option (the "Call
Option") to purchase from the Company (i) all or any portion of its pro rata
share of the Call Option Shares (the "Basic Call Amount"), and (ii) any
additional Call Option Shares as such Purchaser shall indicate it will purchase
or acquire should any of the other Purchasers elect to purchase less than its
full Basic Call Amount (the "Additional Call Amount"), at a price per share
equal to $5.462. A Purchaser's pro rata share shall be determined based upon the
proportion that the purchase price paid by such Purchaser for Securities
purchased under the Purchase Agreement bears to the aggregate purchase prices
paid by all Purchasers under the Purchase Agreement. In the event that
Purchasers elect to purchase an Additional Call Amount that exceeds the Call
Option Shares available for purchase, the available Call Option Shares shall be
allocated among those Purchasers that wish to purchase such shares on a pro rata
basis or in such other manner as the Purchasers may agree.
(b) Each Purchaser may exercise its rights under the Call Option by
delivering a written notice (the "Exercise Notice") to the Company by not later
than 6:30 p.m. (EST) on May 13, 2003, setting forth (i) the closing date for the
purchase of the applicable Call Option Shares, which shall be no later than 6:30
p.m. (EST) on May 16, 2003 (the "Call Option Closing Date"), and (ii) the
portion of such Purchaser's Basic Call Amount that such Purchaser elects to
purchase and the Additional Call Amount, if any, that such Purchaser elects to
purchase. Each Purchaser may revoke its exercise of the Call Option at any time
prior to the closing of the sale of the applicable Call Option Shares to such
Purchaser. The Company shall provide to each Purchaser, not later than one
Trading Day prior to the Call Option Closing Date, written notice of the amount
of the Call Option Shares, if any, that are being purchased by each Purchaser.
2
(c) On the Call Option Closing Date: (x) the Company shall issue and
deliver to each Purchaser (i) a stock certificate, registered in the name of
such Purchaser (or the name of its nominee, if any as specified on Schedule 1
hereto), and (ii) a certificate from the president or chief executive officer of
the Company certifying that all of the representations and warranties of the
Company contained in Section 4 below are true and correct at and as of the
Option Call Closing Date; and (y) each Purchaser shall deliver to the Company
the Share Price for each Call Option Share purchased by such Purchaser
hereunder, in immediately available funds by wire transfer to an account
designated in writing by the Company for such purpose.
SECTION 3. Definitions.
(a) For purposes of this Agreement, the following definitions shall
apply (such definitions to be equally applicable to both the singular and plural
forms of the terms defined):
"Accredited Investor" has the meaning set forth in Regulation D
promulgated under the Securities Act.
"Actual Minimum" means, as of any date, the maximum aggregate number of
shares of Common Stock then issued or potentially issuable in the future
pursuant to the Transaction Documents, including any Warrant Shares issuable
upon exercise in full of all Warrants, ignoring any limits on the number of
shares of Common Stock that may be owned by a Purchaser at any one time.
"Affiliate," when used with respect to any Person, means (i) if such
Person is a corporation, any officer or director thereof and any Person that is,
directly or indirectly, the beneficial owner (by itself or as part of any group)
of more than five percent (5%) of any class of any equity security (within the
meaning of the Exchange Act) thereof, and, if such beneficial owner is a
partnership, any general partner thereof, or if such beneficial owner is a
corporation, any Person controlling, controlled by or under common control with
such beneficial owner, or any officer or director of such beneficial owner or of
any corporation occupying any such control relationship, (ii) if such Person is
a partnership, any general or limited partner thereof and (iii) any other Person
that, directly or indirectly, controls or is controlled by or is under common
control with such Person. For purposes of this definition, "control" (including
the correlative terms "controlling," "controlled by" and "under common control
with"), with respect to any Person, shall mean possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise. The holding of Shares, Warrants or Warrant Shares and
the rights under any Transaction Document (or the exercise of any such rights),
shall not, by itself, cause a Purchaser to be deemed to be an "Affiliate" of the
Company.
"Agreement" means this Common Stock and Warrant Purchase Agreement
(together with exhibits and schedules) as from time to time assigned,
supplemented or amended or as the terms hereof may be waived.
"Board" or "Board of Directors" means with respect to any Person that
is a corporation, a business trust or other entity, the board of directors or
other group, however, designated, which is charged with legal responsibility for
3
the management of such Person, or any committee of such board of directors or
group, however designated, which is authorized to exercise the power of such
board or group in respect of the matter in question.
"Call Option Shares" means 183,000 shares of Common Stock.
"Closing" has the meaning set forth in Section 2(a) hereof.
"Closing Date" has the meaning set forth in Section 2(a) hereof.
"Closing Price" means, for any date, the price determined by the first
of the following clauses that applies: (a) if the Common Stock is then listed or
quoted on an Eligible Market or any other national securities exchange, the
closing price per share of the Common Stock for such date (or the nearest
preceding date) on the primary Eligible Market or exchange on which the Common
Stock is then listed or quoted; (b) if prices for the Common Stock are then
quoted on the OTC Bulletin Board, the closing bid price per share of the Common
Stock for such date (or the nearest preceding date) so quoted; (c) if prices for
the Common Stock are then reported in the "Pink Sheets" published by the
National Quotation Bureau Incorporated (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent closing bid
price per share of the Common Stock so reported; or (d) in all other cases, the
fair market value of a share of Common Stock as determined by an independent
appraiser selected in good faith by Purchasers holding a majority of the Shares.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations and interpretations thereunder.
"Commission" means the United States Securities and Exchange Commission
and any other similar or successor agency of the federal government
administering the Securities Act or the Exchange Act.
"Common Stock" means the Company's common stock, par value $.01 per
share, and shall also include any common stock of the Company hereafter
authorized and any capital stock of the Company of any other class hereafter
authorized that is not preferred as to dividends or assets over any other class
of capital stock of the Company or that has ordinary voting power for the
election of directors of the Company.
"Common Stock Equivalents" means, collectively, Options and Convertible
Securities.
"Company" means Impax Laboratories, Inc., a Delaware corporation, its
successors and assigns.
"Convertible Securities" means any stock or securities (other than
Options) convertible into or exercisable or exchangeable for Common Stock.
"Disclosure Material" means the Company's (i) Annual Report on Form
10-K for the fiscal year ended December 31, 2002, (ii) Proxy Statement for the
Company's 2003 Annual Meeting of Stockholders (other than the information under
the headings "Audit Committee Report," "Compensation Committee Report" or "Stock
Performance Graph") and (iii) Quarterly Report on Form 10-Q for the quarter
ended March 31, 2003.
4
"Disclosure Schedule" means the Company's Disclosure Schedule attached
hereto.
"Effective Date" means the date that the Registration Statement is
first declared effective by the Commission.
"Eligible Market" means any of the New York Stock Exchange, the
American Stock Exchange, the NASDAQ National Market, the NASDAQ SmallCap Market
or the OTC Bulletin Board, or any of their respective successors.
"Environmental Laws" has the meaning set forth in Section 4.14(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and all regulations promulgated thereunder, as in effect from time to
time.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules, regulations and interpretations thereunder.
"Excluded Stock" means any shares of Common Stock or Common Stock
Equivalents issued or issuable (A) to employees, officers, directors of or
consultants or advisors to the Company, in each case, pursuant to a stock-based
plan duly approved by the Company's board of directors; (B) upon exercise,
conversion or exchange of any Common Stock Equivalents described in Section 4.2
(provided that such exercise or conversion occurs in accordance with the terms
thereof, without amendment or modification); (C) to Teva pursuant to the Teva
Agreement with a value not to exceed $22.0 million at the time of issuance, as
determined under the Teva Agreement; (D) in any bona-fide firm commitment
underwritten public offering with a nationally recognized underwriter with an
aggregate offering amount of at least $25,000,000; (D) in connection with any
bona-fide merger or acquisition as approved by the Company's Board of Directors,
the primary purpose of which is not to raise cash; or (E) in connection with any
bona-fide strategic agreement, joint venture agreement, limited liability
agreement or similar agreement entered into with any supplier, manufacturer,
distributor or customer that is approved by the Company's Board of Directors,
the primary purpose of which is not to raise cash from financial investors.
"FDA" means the Food and Drug Administration of the United States
Department of Health and Human Services.
"GAAP" means United States generally accepted accounting principles, as
in effect for the relevant time or for the relevant period, consistently
applied.
"Governmental Authority" means any federal, state, or local
governmental agency or authority (including regulatory authority) having
jurisdiction over the Company or any of its respective assets or businesses.
5
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, claim, restriction, or preference, priority or other
security interest of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same effect as any of the foregoing,
any assignment or other conveyance of any right to receive income and any
assignment of receivables with recourse against the assignor), any filing of a
financing statement as debtor under the Uniform Commercial Code or any similar
statute and any agreement to give or make any of the foregoing; provided that
the term "Lien" shall not include Permitted Liens.
"Losses" means any and all losses, claims, damages, liabilities,
settlement costs and expenses, including, without limitation, costs of
preparation and reasonable attorneys' fees.
"Material Adverse Effect" has the meaning set forth in Section 4.1(a)
hereof.
"Outstanding" means when used with reference to the Shares, Warrants
and Warrant Shares as of a particular time, all Shares, Warrants and Warrant
Shares theretofore duly issued except (i) Shares, Warrants and Warrant Shares
theretofore reported as lost, stolen, mutilated or destroyed or surrendered for
transfer, exchange or replacement, in respect of which new or replacement Shares
have been issued by the Company, (ii) Shares, Warrants and Warrant Shares
theretofore canceled by the Company and (iii) Shares, Warrants and Warrant
Shares registered in the name of, as well as Shares, Warrants and Warrant Shares
owned beneficially by, the Company, or any of its Subsidiaries.
"Options" means any rights, warrants or options to subscribe for or
purchase Common Stock or Convertible Securities.
"Permitted Lien " means (i) any Lien for Taxes, governmental charges or
levies not yet due or delinquent or being contested in good faith by appropriate
proceedings for which adequate reserves have been established in accordance with
GAAP, (ii) any imperfections of title, easements, rights of way or similar
Liens, zoning laws or land use restrictions as normally exist with respect to
property similar in character to the property affected thereby and that
individually or in the aggregate with other such Liens, zoning laws or land use
restrictions do not materially impair the value or marketability of the property
subject to such Liens, zoning laws or land use restrictions or interfere with
the use of such property in the conduct of the business of the Company and that
do not secure obligations for money borrowed, (iii) Liens imposed by any law,
such as mechanic's, materialman's, landlord's, warehouseman's and carrier's
Liens, securing obligations incurred in the ordinary course of business that are
not yet overdue or that are being diligently contested in good faith by
appropriate proceedings and, with respect to such obligations that are being
contested, for which the Company has set aside adequate reserves, if
appropriate, in accordance with GAAP, and (iv) any Lien resulting from purchase
by the Company of goods in the ordinary course of business as to which Liens are
not filed of record.
"Principal Purchaser" means any Purchaser that has purchased at least
one million Shares pursuant to this Agreement.
6
"Person" or "person" means any individual, corporation, partnership,
limited liability company, firm, association, joint venture, trust,
unincorporated organization, government, governmental body, agency, political
subdivision or other entity.
"Plan" means any bonus, compensation, incentive compensation, deferred
compensation, pension, profit sharing, retirement, savings, stock purchase,
stock option, stock ownership, stock appreciation rights, phantom stock, leave
of absence, layoff, vacation, day or dependent care, legal services, cafeteria,
life, health, accident, disability, workmen's compensation or other insurance,
severance, employment, consulting, noncompetition, separation or other employee
benefit plan, program, agreement, practice, policy or arrangement of any kind,
whether written or oral, or whether for the benefit of a single individual or
more than one individual including, but not limited to, any "employee benefit
plan" within the meaning of Section 3(3) of ERISA.
"Proceeding" means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Closing Date, among the Company and each of the
Purchasers.
"Registration Statement" has the meaning set forth in the Registration
Rights Agreement.
"Registrable Securities" has the meaning set forth in the Registration
Rights Agreement.
"Rule 144" means (i) Rule 144 under the Securities Act as such Rule is
in effect from time to time and (ii) any successor rule, regulation or law, as
in effect from time to time.
"Rule 144 Transaction" means a transfer of Securities or Warrant Shares
(A) complying with Rule 144 as such Rule is in effect on the date of such
transfer and (B) occurring at a time when the Common Stock is registered
pursuant to Section 12 of the Exchange Act.
"SEC Reports" has the meaning set forth in Section 4.17 hereof.
"Securities" has the meaning set forth in Section 1(a) hereof.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules, regulations and interpretations thereunder.
"Series 2 Certificate of Designations" means the Certificate of
Designations of the Series 2 Preferred Stock.
"Series 2 Preferred Stock" means the Company's Series 2 Mandatorily
Redeemable Convertible Preferred Stock, par value $.01 per share.
"Shares" has the meaning set forth in Section 1(a) hereof.
7
"Special Counsel" means Proskauer Rose LLP, counsel to the Purchasers.
"Subsidiary" means any significant subsidiary of the Company as defined
in Rule 1-02(w) of Regulation S-X promulgated by the Commission.
"Tax" or "Taxes" means all federal, state, local or foreign net or
gross income, gross receipts, net proceeds, sales, use, ad valorem, value added,
franchise, bank shares, withholding, payroll, employment, excise, property,
alternative or add on minimum, environmental or other taxes, assessments,
duties, fees, levies or other governmental charges of any nature whatsoever,
whether disputed or not, together with any interest, penalties, additions to tax
or additional amounts with respect thereto.
"Tax Returns" means any returns, reports or statements (including any
information returns) required to be filed for purposes of a particular Tax.
"Taxing Authority" means any Governmental Agency, board, bureau, body,
department or authority of any United States federal, state or local
jurisdiction, or any foreign jurisdiction, having or purporting to exercise
jurisdiction with respect to any Tax.
"Trading Day" means (a) any day on which the Common Stock is listed or
quoted and traded on its primary Trading Market, (b) if the Common Stock is not
then listed or quoted and traded on any Eligible Market, then a day on which
trading occurs on the NASDAQ National Market (or any successor thereto), or (c)
if trading ceases to occur on the NASDAQ National Market (or any successor
thereto), any business day.
"Trading Market" means the Nasdaq National Market or any other Eligible
Market, or any national securities exchange, market or trading or quotation
facility on which the Common Stock is then listed or quoted.
"Transaction Documents" means this Agreement, the Warrants, the
Registration Rights Agreement, the Transfer Agent Instructions and any other
documents or agreements executed in connection with the transactions
contemplated hereunder.
"Transfer Agent Instructions" means, with respect to the Company, the
Irrevocable Transfer Agent Instructions, in the form of Exhibit D, executed by
the Company and delivered to and acknowledged in writing by the transfer agent.
"Warrants" has the meaning set forth in Section 1(a) hereof.
"Warrant Shares" has the meaning set forth in Section 1(a) hereof.
(b) For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(i) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Section or other subdivision;
8
(ii) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP (except as otherwise provided
herein);
(iii) all computations provided for herein, if any, shall be made in
accordance with GAAP (except as otherwise provided herein);
(iv) any uses of the masculine, feminine or neuter gender shall also be
deemed to include any other gender, as appropriate;
(v) all references herein to actions by the Company, such as "create,"
"sell," "transfer," "dispose of," etc., mean such action whether voluntary or
involuntary, by operation of law or otherwise;
(vi) the exhibits and schedules to this Agreement shall be deemed a
part of this Agreement;
(vii) each of the representations and warranties of the Company
contained in Section 4 hereof is separate and is not limited, qualified or
modified by the existence, wording or satisfaction of any other representation
or warranty of the Company in Section 4 or otherwise;
(viii) all references herein (in covenants or otherwise) to any
action(s) that are to be taken (or that are prohibited from being taken) by any
Person or the Company shall apply to such Person or the Company, as the case may
be, whether such action is taken directly or indirectly.
SECTION 4. Representations and Warranties of the Company.
The Company represents and warrants to each Purchaser as follows as of
the date hereof and as of the Closing Date:
4.1 Corporate Existence, Power and Authority.
(a) Each of the Company and its Subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization (as applicable). Neither the
Company nor any Subsidiary is in violation of any of the provisions of its
respective certificate or articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and the Subsidiaries is
duly qualified, licensed or authorized as a foreign corporation to do business
and is in good standing under the laws of each jurisdiction in which it owns or
leases any property or in which the conduct of its business requires it to so
qualify or be so qualified, licensed or authorized except for such jurisdictions
where the failure to be so qualified, licensed or authorized would not,
individually or in the aggregate, (i) adversely affect the legality, validity or
enforceability of any Transaction Document, (ii) have or result in a material
adverse effect on the results of operations, assets, prospects, business or
condition (financial or otherwise) of the Company and the Subsidiaries, taken as
a whole on a consolidated basis, or (iii) adversely impair the Company's ability
to perform fully on a timely basis its obligations under any of the Transaction
Documents (any of (i), (ii) or (iii), a "Material Adverse Effect").
9
(b) The Company has all requisite power, authority (corporate and
other) and legal right to execute, deliver, enter into, consummate the
transactions contemplated by and perform its obligations under each Transaction
Document, including, without limitation, the issuance by the Company of the
Securities and Warrant Shares as contemplated herein and therein. The execution,
delivery and performance of each Transaction Document by the Company (including,
without limitation, the issuance by the Company of the Securities and the
issuance of the Warrant Shares upon exercise of the Warrants) have been duly
authorized by all required corporate and other actions. The Company has duly
executed and delivered each Transaction Document. Each Transaction Document
constitutes the legal, valid and binding obligations of the Company enforceable
in accordance with their respective terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to the rights of
creditors generally and to general principles of equity.
(c) No proceeding has been commenced looking toward the dissolution or
merger of the Company or the amendment of its certificate of incorporation. The
Company is not in violation in any respect of its certificate of incorporation
or bylaws.
(d) The Company has all requisite power, authority (corporate and
other) and legal right to own or to hold under lease and to operate the
properties it owns or holds and to conduct its business as now being and as
proposed to be conducted.
4.2 Capital Stock.
(a) As of May 5, 2003, the Company was authorized to issue: (a)
2,000,000 shares of preferred stock, par value $.01 per share, of which (a)
50,000 shares are designated as Series 1-A Convertible Preferred Stock, none of
which are outstanding, (b) 170,000 shares are designated as Series 1-B
Convertible Preferred Stock, none of which are outstanding and (c) 200,000
shares are designated as Series 2 Preferred Stock, of which 75,000 are issued
and outstanding; and (b) 75,000,000 shares of common stock, par value $.01 per
share, of which 47,885,986 shares were issued and outstanding and an aggregate
of 13,279,017 shares were reserved for issuance upon the conversion of the
Series 2 Preferred Stock and the exercise of outstanding warrants and options
issued or issuable under the Company's stock option plans. All of such
outstanding shares are, and on the Closing Date, the Shares will be, duly
authorized, validly issued and outstanding, fully paid and non-assessable and
all such outstanding shares of Common Stock are, and on the Closing Date, the
Shares and Warrant Shares will be, validly listed for trading on the NASDAQ
National Market. The Warrants are duly authorized and the Warrant Shares are
reserved for issuance upon exercise of the Warrants. Upon exercise of the
Warrants in accordance with their terms and payment of the exercise price
payable thereunder, the Warrant Shares issued thereunder will be duly
authorized, validly issued and outstanding, fully paid and non-assessable.
Except as provided in the Series 2 Certificate of Designations, none of the
shares of the Company's capital stock that will be outstanding at the Closing
provide the holders thereof with any preemptive rights with respect to any
issuances of capital stock. The Securities and the Warrant Shares will be issued
free of the preemptive rights of any Person. The rights, privileges and
preferences of the Series 2 Preferred Stock are as stated in the Series 2
Certificate of Designations.
10
(b) Except as referred to in Section 4.2(a) or as described in the
Disclosure Schedule attached hereto, there are no outstanding options, warrants,
subscriptions, rights, convertible securities or other agreements or plans under
which the Company may become obligated to issue, sell or transfer shares of its
capital stock or other securities.
(c) Except as set forth in the Series 2 Certificate of Designations or
as described in the Disclosure Schedule attached hereto, there are no
antidilution protections or other adjustment provisions in existence with
respect to any capital stock of the Company. The issuance of the Securities and
the Warrant Shares by the Company will not trigger the issuance of additional
shares or an adjustment in the conversion ratio or similar feature of any
security pursuant to the terms of any anti-dilution or other adjustment
provision with respect to any capital stock of the Company.
(d) Except for the registration rights contained in the Registration
Rights Agreement and except as described in the Disclosure Schedule, the Company
has not granted or agreed to grant to any Person any rights (including
"piggy-back" registration rights) to have any securities of the Company
registered with the Commission or any other governmental authority that have not
been satisfied.
(e) Except as described in the Disclosure Schedule attached hereto,
there are no voting agreements, voting trusts, proxies or other agreements or
understandings with respect to the voting of any capital stock of the Company of
which the Company is a party.
(f) The Company's Common Stock is registered pursuant to Section 12(g)
of the Exchange Act and is listed on the NASDAQ National Market, and the Company
has taken no action designed to, or 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 National Market, nor to the Company's knowledge is
the National Association of Securities Dealers, Inc. currently contemplating
terminating such listing. The Company and the Common Stock meet the criteria for
continued listing and trading on the NASDAQ National Market.
4.3 Subsidiaries.
The Company has no direct or indirect Subsidiaries other than those
listed in the Disclosure Schedule. Except as disclosed in the Disclosure
Schedule, the Company owns, directly or indirectly, all of the capital stock or
comparable equity interests of each Subsidiary free and clear of any Lien and
all the issued and outstanding shares of capital stock or comparable equity
interest of each Subsidiary are validly issued and are fully paid,
non-assessable and free of preemptive and similar rights.
4.4 No Defaults or Conflicts.
(a) Neither the Company nor its Subsidiaries is in violation or default
in any material respect (and is not in default in any respect regarding any
indebtedness) under any indenture, agreement, credit facility, debt or other
instrument to which it is a party or by which it or its properties may be bound.
Neither the Company nor its Subsidiaries is in default in any material respect
under any material order, writ, injunction, judgment or decree of any court or
other Governmental Authority or arbitrator(s).
11
(b) The execution, delivery and performance by the Company of each
Transaction Document and any of the transactions contemplated hereby or thereby
(including, without limitation, the issuance of the Securities and the Warrant
Shares as contemplated herein and therein) do not and will not (i) violate or
conflict with, with or without the giving of notice or the passage of time or
both, any provision of (A) the certificate of incorporation or by-laws of the
Company or its Subsidiaries, (B) any law, rule, regulation or order of any
federal, state, county, municipal or other Governmental Authority, including,
without limitation, the rules, regulations and policies of the Commission and
the FDA, (C) any judgment, writ, injunction, decree, award or other action of
any court or Governmental Authority or arbitrator(s), or (D) any agreement,
indenture, credit facility, debt or other instrument applicable to the Company
or any of its respective properties, (ii) result in the creation of any Lien
upon any of the Company's properties, assets or revenues, (iii) require the
consent, waiver, approval, order or authorization of, or declaration,
registration, qualification or filing with, any Person (whether or not a
Governmental Authority and including, without limitation, any shareholder
approval) or (iv) cause anti-dilution clauses of any outstanding securities to
become operative or give rise to any preemptive rights. No provision referred to
in Section (C) of the preceding clause (i) could have or result in a Material
Averse Affect.
4.5 Disclosure Material; Other Information.
(a) The Company has previously furnished the Disclosure Material to the
Purchaser. The audited and unaudited financial statements contained in the
Disclosure Material fairly present the financial condition of the Company and
its Subsidiaries as of the respective dates thereof and the results of the
operations and cash flows of the Company and its Subsidiaries for such periods
and have been prepared in accordance with GAAP, applied on a consistent basis
throughout the periods therein specified, except that any such unaudited
statements may omit notes and may be subject to normal year-end audit
adjustments.
(b) The Disclosure Material as of its date (or, with respect to
exhibits contained in such Disclosure Material, as of the date of such exhibits)
does not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading.
(c) Since December 31, 2002, (i) the business of the Company and its
Subsidiaries has been conducted in the ordinary course and (ii) there has been
no material adverse change in the assets, properties, liabilities, business,
affairs, results of operations, condition (financial or otherwise) or prospects
of the Company and its Subsidiaries.
(d) Since December 31, 2002, there has been no change or amendment to
the certificate of incorporation or bylaws or other organizational documents of
the Company or its Subsidiaries.
(e) There are no material liabilities, contingent or otherwise, of the
Company or its Subsidiaries that have not been disclosed in the financial
statements referred to in Section 4.5(a) or otherwise disclosed in the
Disclosure Material.
12
(f) There is no fact known to the Company that is not in the Disclosure
Material and that has had a Material Adverse Effect, or in the future could be
reasonably likely (as far as the Company currently can reasonably foresee) to
have a Material Adverse Effect.
(g) The Company confirms that neither it nor any other Person acting on
its behalf has provided any of the Purchasers or their agents or counsel with
any information that constitutes or might constitute material, nonpublic
information as of the date hereof, assuming that the press release contemplated
by the first sentence of Section 6.6 is issued. The Company understands and
confirms that each of the Purchasers will rely on the foregoing representations
in effecting transactions in securities of the Company. The Disclosure Material
and the Disclosure Schedule to this Agreement, furnished by or on behalf of the
Company, are true and correct and, when taken together as a whole as of the date
hereof, do not contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not misleading. No event
or circumstance has occurred or information exists with respect to the Company
or any of its Subsidiaries or its or their business, properties, prospects,
operations or financial conditions, which, under applicable law, rule or
regulation, requires public disclosure or announcement by the Company but which
has not been so publicly announced or disclosed, assuming that the press release
contemplated by the first sentence of Section 6.6 is issued.. The Company
acknowledges and agrees that no Purchaser makes or has made any representations
or warranties with respect to the transactions contemplated hereby other than
those specifically set forth in Section 5.
4.6 Litigation.
(a) Other than as set forth in the Disclosure Material, there is no
action, suit, proceeding, investigation or claim pending or, to the knowledge of
the Company, threatened in law, equity or otherwise before any court,
administrative agency or arbitrator that (i) questions the validity of the
Transaction Documents, the Securities or the Warrant Shares or (ii) is
reasonably expected to have a Material Adverse Effect.
(b) There is no legal or Governmental Authority proceeding pending, or
to the knowledge of the Company, threatened to which the Company, its
Subsidiaries or any officer or director of the Company or Subsidiaries in their
capacity as such officer or director is or may be made a party or of which the
business or property of the Company or its Subsidiaries is subject that is not
disclosed in the SEC Reports.
4.7 Taxes.
The Company and its Subsidiaries have duly and timely filed all Tax
Returns required to be filed by it, and each such Tax Return correctly and
completely reflects in all material respects the Tax liability and all other
information required to be reported thereon. The Company and its Subsidiaries
have paid or caused to be paid all Taxes (whether or not reflected on such Tax
Returns) that are due and payable. The provision for Taxes due by the Company
and its Subsidiaries in the most recent financial statement included in the
Disclosure Material is sufficient in all material respects for all unpaid Taxes,
being current Taxes not yet due and payable, of the Company and its
Subsidiaries, as of the end of the period covered by such financial statement,
13
and as of the Closing Date, such provision, as adjusted for the passage of time
through such date, will be sufficient in all material respects for the then
accrued and unpaid Taxes not yet due and payable of the Company and its
Subsidiaries. No Tax Returns of the Company or its Subsidiaries have ever been
audited by any Taxing Authority, there is no dispute concerning any Tax
liability of the Company or its Subsidiaries either threatened, claimed or
raised by any Taxing Authority, and the Company and its Subsidiaries do not
expect any Taxing Authority to assess additional Taxes against or in respect of
it for any past period. The Company and its Subsidiaries have withheld and paid,
or, if not yet due for payment, set aside in accounts for such purposes, all
Taxes required to have been withheld in connection with amounts paid or owing to
any employee, creditor, independent contractor or other third party. Other than
stamp taxes, the Company and its Subsidiaries have no liability for Taxes of any
Person other than the Company and its Subsidiaries (i) as a transferee or
successor, (ii) by contract, or (iii) otherwise. There are no applicable Taxes
payable by the Company or its Subsidiaries in connection with the execution and
delivery of the Transaction Documents or the issuance by the Company of the
Securities or the Warrant Shares.
4.8 ERISA.
The Company is in compliance in all material respects with all
presently applicable provisions of ERISA; no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA) for
which the Company would have any liability which could have a Material Adverse
Effect; the Company has not incurred and does not expect to incur liability
which could have a Material Adverse Effect under (a) Title IV of ERISA with
respect to termination of, or withdrawal from, any "pension plan" or (b)
Sections 412 or 4971 of Code; and to the knowledge of the Company (x) each
"pension plan" for which the Company would have any liability that is intended
to be qualified under Section 401(a) of the Code is so qualified in all material
respects and (y) nothing has occurred, whether by action or by failure to act,
which would cause the loss of such qualification.
4.9 Legal Compliance.
(a) The Company's and its Subsidiaries' manufacturing, distribution and
marketing practices are in compliance in all material respects with all
applicable laws, rules, regulations, orders, licenses, judgments, writs,
injunctions, decrees or demands, including, without limitation, laws and
regulations administered by the FDA and the Drug Enforcement Administration
("DEA").
(b) The Company and its Subsidiaries possess all material FDA new drug
applications, abbreviated new drug applications, and new animal drug
applications as are necessary for the conduct of its business as now being
conducted.
(c) There are no adverse orders, judgments, writs, injunctions,
decrees, or demands of any court or administrative body, domestic or foreign, or
of any governmental agency or instrumentality, domestic or foreign, outstanding
against the Company and its Subsidiaries.
14
(d) The Company and its Subsidiaries have not and will not use the
services of any person debarred under the provisions of the Generic Drug
Enforcement Act of 1992, 21 U.S.C. ss. 335(a)(b). None of the Company's or its
Subsidiaries' officers or employees has been convicted of a felony under federal
law for conduct relating to the development, approval or regulation of any
product subject to the Federal Food, Drug, and Cosmetic Act or the Controlled
Substances Act.
(e) The Company and its Subsidiaries have been in material compliance
with all laws, regulations and rulings regarding the terms and conditions of
employment of employees, former employees or prospective employees or other
labor related matters.
(f) The Company and its Subsidiaries are in compliance with all
applicable laws, rules, regulations, orders, licenses, judgments, writs,
injunctions, decrees or demands, except where the failure to be in compliance
will not have a Material Adverse Effect.
4.10 Outstanding Securities.
All securities (as defined in the Securities Act) of the Company have
been offered, issued, sold and delivered in compliance with, or pursuant to
exemptions from, all applicable federal and state laws, and the rules and
regulations of federal and state regulatory bodies governing the offering,
issuance, sale and delivery of securities.
4.11 Permits, Licenses and Approvals; Intellectual Property and Other
Rights.
Other than as set forth in the Disclosure Material, the Company and its
Subsidiaries own or possess and hold free from material conflicts with the
rights of others all franchises, licenses, permits, consents, approvals and
other authority (governmental or otherwise), patents, patent rights, trademarks,
trademark rights, trade names, trade name rights, copyrights and other
intellectual property rights, and all rights and privileges with respect to any
of the foregoing, as are necessary for the conduct of its business as now being
conducted and as currently proposed to be conducted; provided that, no such
representation is made with respect to government franchises, licenses, permits,
consents, approvals or other authority which may be required with respect to the
Company's and its Subsidiaries' business as proposed to be conducted. Neither
the Company nor its Subsidiaries is in default in any material respect under any
of such franchises, licenses, permits, consents, approvals or other authority.
Other than as set forth in the Disclosure Material, the rights of (and use by)
the Company and its Subsidiaries with respect to such or any other patents,
patent rights, trademarks, trademark rights, trade names, trade name rights,
copyrights or other intellectual property rights do not conflict with or
infringe any rights of others in a manner that could have a Material Adverse
Effect, and no such claim of conflict or infringement has been asserted by any
Person.
4.12 Key Employees.
The Company and its Subsidiaries have good relationships with its
employees and have not had and do not expect any material labor problems. The
Company and its Subsidiaries have no knowledge as to any intentions of any key
employee or any group of employees to leave the employ of the Company or its
Subsidiaries. The employees of the Company and its Subsidiaries are not and have
never been represented by any labor union, and no collective bargaining
15
agreement is binding and in force against the Company or its Subsidiaries or
currently being negotiated by the Company or its Subsidiaries.
4.13 Suppliers and Customers.
(a) The Company and its Subsidiaries have adequate sources of supply
for its business as currently conducted and as proposed to be conducted. The
Company and its Subsidiaries have good relationships with all of its material
sources of supply of goods and services and does not anticipate any material
problem with any such material sources of supply.
(b) The Company and its Subsidiaries have no knowledge that the
customer base of the Company might materially decrease.
4.14 Environmental Compliance.
(a) There has been no storage, generation, transportation, handling,
treatment, disposal, discharge, emission or other release of any kind of toxic
or other wastes or other hazardous substances by, due to or caused by the
Company or its Subsidiaries (or, to the best knowledge of the Company, any other
entity (including any predecessor) for whose acts or omissions the Company or
its Subsidiaries is or may reasonably be expected to be liable) upon any of the
property now or previously owned or leased by the Company or its Subsidiaries,
in violation of any statute or any ordinance, rule, regulation, order, judgment,
decree or permit or which would, under any statute or any ordinance, rule
(including rule of common law), regulation, order, judgment decree or permit,
give rise to any liability, except for any violation or liability which could
not have, singularly or in the aggregate with all such violations and
liabilities, a Material Adverse Effect; and there has been no disposal,
discharge, emission or other release of any kind onto such property or into the
environment surrounding such property of any toxic or other wastes or other
hazardous substances with respect to which the Company or its Subsidiaries have
knowledge, except for any such disposal, discharge, emission or other release of
any kind which could not have, singularly or in the aggregate with all such
discharges and other releases, a Material Adverse Effect.
(b) The Company and its Subsidiaries (i) are in compliance in all
material respects with any and all applicable foreign, federal, state and local
laws and regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all material permits,
licenses or other approvals required of it under applicable Environmental Laws
to conduct its business and (iii) are in compliance with all terms and
conditions of any permit, license or approval, except where such noncompliance
with Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals could not, individually or in the aggregate, have a
Material Adverse Effect.
4.15 No Burdensome Agreements.
To the knowledge of the Company, other than this Agreement and the
related documents, the Company and its Subsidiaries are not a party to any
contract or agreement with any Affiliate of the Company or its Subsidiaries, the
terms of which are less favorable to the Company or its Subsidiaries than those
16
that might have been obtained, at the time such contract or agreement was
entered into, from a Person who was not such an Affiliate.
4.16 Offering of Securities.
None of the Company, its Subsidiaries nor to the knowledge of the
Company, any agent or any other person acting on its behalf, directly or
indirectly, (i) offered any of the Securities or Warrant Shares or any similar
security of the Company (A) by any form of general solicitation or general
advertising (within the meaning of Regulation D under the Securities Act) or (B)
for sale to or solicited offers to buy any thereof from, or otherwise approached
or negotiated with respect thereto with, any person other than the Purchasers
and not more than a limited number of other institutional investors each of
which the Company reasonably believed was an "accredited investor" within the
meaning of Regulation D under the Securities Act or (ii) has done or caused to
be done (or has omitted to do or to cause to be done) any act, which act (or
which omission) would result in bringing the issuance or sale of the Securities
or the Warrant Shares within the provisions of Section 5 of the Securities Act
or the filing, notification or reporting provisions of any "blue sky" or
securities laws of any state or other jurisdiction. Assuming the accuracy of the
representations and warranties made by, and compliance with the covenants of,
each of the Purchasers in Section 5 hereof (now and, with respect to the Warrant
Shares, at the time of any exercise of the Warrants), no registration of the
Securities or Warrant Shares under the Securities Act is required in connection
with the offer and sale of the Securities by the Company to the Purchasers or
the exercise of the Warrants by the Purchasers as contemplated by this Agreement
or the other Transaction Documents. The Company has not taken and will not, in
violation of applicable law, take, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the Securities
or the Warrant Shares.
4.17 SEC
(a) The Company has filed in a timely manner all proxy statements,
reports and other documents required to be filed by it under the Exchange Act,
including pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (the foregoing materials (together with any materials
filed by the Company under the Exchange Act, whether or not required) being
collectively referred to herein as the "SEC Reports". The Company has furnished
the Purchaser with copies of (i) its Annual Report on Form 10-K for the fiscal
year ended December 31, 2002, (ii) its Proxy Statement for the Company's 2003
Annual Meeting of Stockholders and (iii) its Quarterly Report on Form 10-Q for
the quarter ended March 31, 2003. Each SEC Report is in compliance with the
requirements of its respective form and none of the SEC Reports, nor the
financial statements (and the notes thereto) included in the SEC Reports, as of
their respective dates, contained any untrue statement of a material fact or
omitted 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 SEC Reports, when taken together as a whole as of the
date hereof with the other information in the Disclosure Schedule, do 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
light of the circumstances under which they were made not misleading. The
financial statements of the Company included in the SEC Reports comply in all
material respects with applicable accounting requirements and the rules and
17
regulations of the Commission with respect thereto as in effect at the time of
filing. Such financial statements have been prepared in accordance with GAAP,
except as may be otherwise specified in such financial statements or the notes
thereto, and fairly present in all material respects the financial position of
the Company and its consolidated subsidiaries as of and for the dates thereof
and the results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal, year-end audit
adjustments. All material agreements (as contemplated by Commission Regulation
601(b)(10)) to which the Company or any Subsidiary is a party or to which the
property or assets of the Company or any Subsidiary are subject are included as
part of or specifically identified in the SEC Reports.
(b) Since the date of the latest audited financial statements included
within the SEC Reports, except as specifically disclosed in the SEC Reports or
in the Disclosure Schedule, (i) there has been no event, occurrence or
development that, individually or in the aggregate, has had or that could result
in a Material Adverse Effect, (ii) the Company has not incurred any liabilities
(contingent or otherwise) other than (A) trade payables and accrued expenses
incurred in the ordinary course of business consistent with past practice and
(B) liabilities not required to be reflected in the Company's financial
statements pursuant to GAAP or required to be disclosed in filings made with the
Commission, (iii) the Company has not altered its method of accounting or the
identity of its auditors, except as disclosed in its SEC Reports, (iv) the
Company has not declared or made any dividend or distribution of cash or other
property to its stockholders or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock, and (v) the Company has not
issued any equity securities to any officer, director or Affiliate, except
pursuant to existing Company stock-based plans.
(c) The Company is eligible to register the Securities and Warrant
Shares for offer and sale by the Purchasers on Form S-3 promulgated under the
Securities Act.
4.18 Use of Proceeds.
The Company will use the net proceeds to be received from the sale of
the Securities and Warrant Shares for working capital and general corporate
purposes and prior to the first anniversary of the Closing Date will not use the
net proceeds (i) for the satisfaction of any portion of the Company's debt
(other than payment of trade payables, indebtedness under the Company's existing
credit facilities, indebtedness not exceeding $100,000, and accrued expenses in
the ordinary course of the Company's business and prior practices and other than
the payment of up to $22.0 million to Teva pursuant to the Teva Agreement), (ii)
to redeem any Company equity or equity-equivalent securities (other than to
redeem the Teva Stock), or (iii) to settle any outstanding litigation. Except
for the redemption of the Teva Stock, no portion of such proceeds will be used
for the purpose, whether immediate, incidental or ultimate, of purchasing or
carrying, within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System, as amended from time to time, any "margin stock" as
defined in said Regulation U, or any "margin stock" as defined in Regulation G
of the Board of Governors of the Federal Reserve System, as amended from time to
time, or for the purpose of purchasing, carrying or trading in securities within
the meaning of Regulation T of the Board of Governors of the Federal Reserve
System, as amended from time to time, or for the purpose of reducing or retiring
any indebtedness that both (i) was originally incurred to purchase any such
margin stock or other securities and (ii) was directly or indirectly secured by
18
such margin stock or other securities. None of the assets of the Company
includes any such "margin stock." Except for the redemption of the Teva Stock,
the Company has no present intention of acquiring any such "margin stock."
4.19 Other Names.
Except for "Global Pharmaceutical Corporation" and "Impax
Pharmaceuticals, Inc.," the businesses previously or presently conducted by the
Company have not been conducted under any corporate, trade or fictitious name.
4.20 Brokers.
Except for listing fees to be paid by the Company to the Trading Market
and fees to Wachovia Securities, Inc., no fees or commissions will be payable by
the Company to any broker, financial advisor or consultant, finder, placement
agent, investment banker, bank or other Person with respect to the transactions
contemplated by the Transaction Documents. The Purchasers shall have no
obligation with respect to any fees incurred by the Company or any other Person
(other than the Purchasers, if the Purchasers have agreed in writing to pay such
fees) or with respect to any claims made by or on behalf of other Persons for
fees of a type contemplated in this Section that may be due in connection with
the transactions contemplated by the Transaction Documents. The Company shall
indemnify and hold harmless the Purchasers, their employees, officers,
directors, agents, and partners, and their affiliates, from and against all
claims, losses, damages, costs (including the reasonable costs of preparation
and reasonable attorney's fees) and expenses suffered in respect of any such
claimed or existing fees incurred by the Company or any other Person (other than
the Purchasers, if the Purchasers have agreed in writing to pay such fees), as
such fees and expenses are incurred.
4.21 Insurance.
The Company maintains and will continue to maintain insurance against
loss or damage by fire or other casualty and such other insurance, including,
but not limited to, product liability insurance, in such amounts and covering
such risks as is reasonably adequate consistent with industry practice for the
conduct of its business and the value of its properties, all of which insurance
is in full force and effect.
4.22 Investment Company.
The Company is not an "investment company" within the meaning of such
term under the Investment Company Act of 1940 and the rules and regulations
thereunder and will not become an investment company upon the receipt and
application of the net proceeds of the offering contemplated by this Agreement.
4.23 Issuance of the Securities.
The Securities and the Warrant Shares are duly authorized and, when
issued and paid for in accordance with the Transaction Documents, will be duly
and validly issued, fully paid and nonassessable, free and clear of all Liens
and shall not be subject to preemptive rights or similar rights of stockholders.
19
The Company has reserved from its duly authorized capital stock the maximum
number of shares of Common Stock currently issuable upon exercise of the
Warrants.
4.24 Title to Assets.
The Company and the Subsidiaries have good and marketable title in fee
simple to all real property owned by them that is material to the business of
the Company and the Subsidiaries and good and marketable title in all personal
property owned by them that is material to the business of the Company and the
Subsidiaries, in each case free and clear of all Liens, except for Liens that do
not materially affect the value of such property, do not materially interfere
with the use made and proposed to be made of such property by the Company and
the Subsidiaries and could not, individually or in the aggregate, have or result
in a Material Adverse Effect and except as otherwise described in the Disclosure
Material. Any real property and facilities held under lease by the Company and
the Subsidiaries are held by them under valid, subsisting and enforceable leases
of which the Company and the Subsidiaries are in compliance.
4.25 Listing and Maintenance Requirements.
The Common Stock is listed for trading on the Nasdaq National Market.
The Company is filing on the Closing Date a notification with Nasdaq for the
listing of the Common Stock purchased hereunder (and all Warrant Shares). All
such securities will be listed for trading on the Nasdaq National Market upon
issuance. For so long as the Company is obligated to keep and maintain the
effectiveness of the Registration Statement, the Company will use its reasonable
best efforts to maintain its listing on the Nasdaq National Market. The Company
has not, in the two years preceding the date hereof, received notice (written or
oral) from any Trading Market on which the Common Stock is or has been listed or
quoted to the effect that the Company is not in compliance with the listing or
maintenance requirements of such Trading Market. The Company is in compliance
with all such listing and maintenance requirements.
4.26 Application of Takeover Protections.
There is no control share acquisition, business combination, poison
pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under the Company's charter documents or the laws of its
state of incorporation that is or could become applicable to any of the
Purchasers solely as a result of the Purchasers and the Company fulfilling their
obligations or exercising their rights under the Transaction Documents,
including, without limitation, as a result of the Company's issuance of the
Securities and Warrant Shares and the Purchasers' ownership of the Securities
and Warrant Shares.
4.27 Acknowledgment Regarding Purchasers' Purchase of Securities.
The Company acknowledges and agrees that each of the Purchasers is
acting solely in the capacity of an arm's length purchaser with respect to this
Agreement and the transactions contemplated hereby. The Company further
acknowledges that no Purchaser is acting as a financial advisor or fiduciary of
the Company (or in any similar capacity) with respect to this Agreement and the
transactions contemplated hereby and any advice given by any Purchaser or any of
their respective representatives or agents in connection with this Agreement and
the transactions contemplated hereby is merely incidental to the Purchasers'
20
purchase of the Securities and Warrant Shares. The Company further represents to
each Purchaser that the Company's decision to enter into this Agreement has been
based solely on the independent evaluation of the transactions contemplated
hereby by the Company and its representatives. The Company did not provide any
information to the Purchasers other than the Transaction Documents and the
Disclosure Material.
SECTION 5. Representations and Warranties of the Purchaser.
Each Purchaser, severally but not jointly, represents and warrants to
the Company as follows:
5.1 Corporate Power and Authority.
The Purchaser has all requisite power, authority and legal right to
execute, deliver, enter into, consummate the transactions contemplated by and
perform its obligations under this Agreement and the Registration Rights
Agreement. The execution, delivery and performance of this Agreement and the
Registration Rights Agreement by the Purchaser have been duly authorized by all
required corporate and other actions. The Purchaser has duly executed and
delivered this Agreement and the Registration Rights Agreement, and this
Agreement and the Registration Rights Agreement constitute the legal, valid and
binding obligations of the Purchaser enforceable against the Purchaser in
accordance with their respective terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to the rights of
creditors generally and to general principles of equity.
5.2 Investment Intent.
The Purchaser and each account for which it is acting is an Accredited
Investor. The Purchaser is capable of evaluating the risk of its investment in
the Securities and Warrant Shares being purchased by it and the Purchaser and
any account for which the Purchaser is acting is able to bear the economic risk
of such investment and the complete loss of such investment. The Purchaser has
had the opportunity to request and receive all information deemed necessary by
it to evaluate an investment in the Company. The Purchaser confirms that the
Company has made available to the Purchaser the opportunity to ask questions of,
and receive answers from the Company concerning the terms and conditions of the
Securities and the Warrant Shares and the nature of the business of the Company,
and to obtain additional information or documents which the Company possesses or
can acquire without unreasonable effort or expense. In formulating the decision
to acquire the Securities and Warrant Shares, the Purchaser has relied solely
upon its own advisors and its own independent investigation of the Company with
respect to this Agreement and the nature and effect of any investment in the
Securities and Warrant Shares. The Purchaser is purchasing the Securities and
Warrant Shares for its own account or for one or more accounts as to each of
which it exercises investment discretion solely for the purpose of investment
and not with a view to, or for sale in connection with, any distribution thereof
in violation of applicable securities laws. The Purchaser acknowledges that the
Securities and the Warrant Shares have not been registered under the Securities
Act and may be sold or disposed of in the absence of such registration only
pursuant to an exemption from the registration requirements of the Securities
Act. If the Purchaser should in the future decide to dispose of any of its
Securities or Warrant Shares it is understood that it may do so only in
21
compliance with the Securities Act, applicable securities laws and this
Agreement. If domiciled in the United States, Purchaser's domicile is in the
state indicated on Schedule 1 hereto. Other than the Transaction Documents and
the Disclosure Material, the Purchaser did not rely on any other information in
determining whether to enter into the Transaction Documents and purchase the
Securities.
SECTION 6. Transfer; Restrictions and Mechanics
6.1 Transfers.
(a) Each Purchaser agrees that it will not sell or otherwise dispose of
any Securities or Warrant Shares unless such Securities or Warrant Shares have
been registered under the Securities Act and, to the extent required, under any
applicable state securities laws, or pursuant to an applicable exemption from
such registration requirements, and in each case in compliance with the
Securities Act and any applicable state securities laws, including without
limitation applicable prospectus delivery requirements. The Company may endorse
on all Share and Warrant Share certificates and Warrants a legend stating or
referring to such transfer restrictions; provided, that no such legend shall be
endorsed on any Share or Warrant Share certificates or Warrants that, when
issued, are no longer subject to the restrictions of this Section 6.
(b) In connection with any transfer of Securities and Warrant Shares
other than pursuant to an effective registration statement or to the Company or
pursuant to Rule 144(k), except as otherwise expressly set forth herein, the
transferor shall provide to the Company an opinion of counsel selected by the
transferor, the form and substance of which opinion shall be reasonably
satisfactory to the Company, to the effect that such transfer does not require
registration under the Securities Act or applicable state securities laws.
Notwithstanding the foregoing, the Company hereby consents to and agrees to
register on the books of the Company and with its transfer agent, without any
such legal opinion, any transfer of Securities and Warrant Shares by a Purchaser
to an Affiliate of such Purchaser, provided that the transferee certifies to the
Company that it is an Accredited Investor and delivers to the Company a written
statement in which it makes such representations and certification as set forth
in Sections 5.2.
(c) The Purchaser agrees to the placement on the Warrants and the
certificates representing the Shares and Warrant Shares issued to the Purchaser
pursuant to the terms hereof, and any Warrant or certificate issued at any time
in exchange or substitution for any Warrant or certificate bearing such legend,
a legend (the "Private Placement Legend") substantially as set forth below:
[NEITHER] THE SECURITIES REPRESENTED BY THIS CERTIFICATE [NOR THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE] HAVE [NOT] BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAW, AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT OR PURSUANT TO AN EXEMPTION FROM, OR
IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
22
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NOTWITHSTANDING
THE FOREGOING, THESE SECURITIES [AND THE SECURITIES ISSUABLE UPON
EXERCISE OF THESE SECURITIES] MAY BE PLEDGED IN CONNECTION WITH A BONA
FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY
SUCH SECURITIES, PROVIDED THAT THE PLEDGEE IS AN "ACCREDITED INVESTOR"
WITHIN THE MEANING OF REGULATION D PROMULGATED UNDER THE SECURITIES
ACT.
(d) Warrants and certificates evidencing Shares or Warrant Shares shall
not be required to contain such legend or any other legend (i) while a
Registration Statement covering the resale of such Securities or Warrant Shares
is effective under the Securities Act, or (ii) following any sale of such
Securities or Warrant Shares pursuant to Rule 144, or (iii) if such Securities
or Warrant Shares are eligible for sale under Rule 144(k), or (iv) if such
legend is not required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the Staff of
the Commission) and the holder shall provide to the Company an opinion of
counsel selected by the holder, the form and substance of which opinion shall be
reasonably satisfactory to the Company, to such effect; provided, however, that
the holder agrees to return any Warrants and certificates evidencing the Shares
and Warrant Shares that have not been sold, to the extent practicable, for
endorsement of a legend set forth above at such time as the Company notifies the
holder that such legend is required because the Registration Statement covering
the sale of such Securities or Warrant Shares is no longer effective and none of
the other conditions in clauses (ii), (iii) or (iv) has been satisfied. The
Company shall cause its counsel to issue the legal opinion included in the
Transfer Agent Instructions to the Company's transfer agent on the Effective
Date. Following the Effective Date or at such earlier time as a legend is no
longer required for certain Securities or Warrant Shares, the Company will no
later than five Trading Days following the delivery by a Purchaser and receipt
by the Company or the Company's transfer agent of a Warrant or a legended
certificate representing Shares or Warrant Shares, deliver or cause to be
delivered to such Purchaser a certificate representing such Securities or
Warrant Shares that is free from all restrictive and other legends. The Company
may not make any notation on its records or give instructions to any transfer
agent of the Company that enlarge the restrictions on transfer set forth in this
Section. For so long as any Purchaser owns Securities, the Company will not
effect or publicly announce its intention to effect any exchange,
recapitalization or other transaction that effectively requires or rewards
physical delivery of certificates evidencing the Common Stock, other than as
required by applicable law or regulation.
(e) The Company acknowledges and agrees that a Purchaser may from time
to time pledge or grant a security interest in some or all of the Securities and
Warrant Shares in connection with a bona fide margin agreement or other loan or
financing arrangement secured by the Securities or Warrant Shares and, if
required under the terms of such agreement, loan or arrangement, such Purchaser
may transfer pledged or secured Securities or Warrant Shares to the pledgees or
secured parties (subject to any restrictions on transfer applicable to such
pledgees or secured parties pursuant to applicable law, including without
limitation the Securities Act and applicable state securities laws); provided,
however, that if such pledge or transfer occurs prior to the Effective Date, the
pledgee or transferee must be an Accredited Investor. Such a pledge or transfer
23
would not be subject to approval of the Company and no legal opinion of the
pledgee, secured party or pledgor shall be required in connection therewith.
Further, no notice shall be required of such pledge. At the appropriate
Purchaser's expense and provision of the selling shareholder and plan of
distribution information required to be set forth therein with respect to such
pledgee or transferee, the Company will execute and deliver such reasonable
documentation as a pledgee or secured party of Securities or Warrant Shares may
reasonably request in connection with a pledge or transfer of the Securities or
Warrant Shares, including the preparation and filing of any required prospectus
supplement under Rule 424(b)(3) of the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of selling
stockholders in the Prospectus.
6.2 Furnishing of Information.
As long as any Purchaser owns Securities or Warrant Shares, the Company
covenants to timely file (or obtain extensions in respect thereof and file
within the applicable grace period) all reports required to be filed by the
Company after the date hereof pursuant to the Exchange Act. Upon the request of
any Purchaser, the Company shall deliver to such Purchaser a written
certification of a duly authorized officer as to whether it has complied with
the preceding sentence. As long as any Purchaser owns Securities or Warrant
Shares, if the Company is not required to file reports pursuant to such laws, it
will prepare and furnish to the Purchasers and make publicly available in
accordance with paragraph (c) of Rule 144 such information as is required for
the Purchasers to sell the Securities and Warrant Shares under Rule 144. The
Company further covenants that it will take such further action as any holder of
Securities or Warrant Shares may reasonably request to satisfy the provisions of
Rule 144 applicable to the issuer of securities relating to the sale of
securities pursuant to Rule 144.
6.3 Integration.
The Company shall not, and shall use its reasonable best efforts to
ensure that no Affiliate of the Company shall, sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that it knows or should know would be
integrated with the offer or sale of the Securities or Warrant Shares in a
manner that would require the registration under the Securities Act of the sale
of the Securities or Warrant Shares to the Purchasers or that it knows or should
know would be integrated with the offer or sale of the Securities or Warrant
Shares for purposes of the rules and regulations of any Trading Market.
6.4 Reservation of Securities.
The Company shall maintain a reserve from its duly authorized shares of
Common Stock for issuance pursuant to the Transaction Documents in such amount
as may be required to fulfill its obligations in full under the Transaction
Documents. In the event that at any time the then authorized shares of Common
Stock are insufficient for the Company to satisfy its obligations in full under
the Transaction Documents, the Company shall promptly take such actions as may
be required to increase the number of authorized shares.
24
6.5 Subsequent Placements.
(a) From the date hereof until the Effective Date (the "Blockout
Period"), the Company will not, directly or indirectly, offer, sell, grant any
option to purchase, or otherwise dispose of (or announce any offer, sale, grant
or any option to purchase or other disposition of) any of its or the
Subsidiaries' equity or equity equivalent securities, including without
limitation any debt, preferred stock or other instrument or security that is, at
any time during its life and under any circumstances, convertible into or
exchangeable or exercisable for Common Stock or Common Stock Equivalents (any
such offer, sale, grant, disposition or announcement being referred to as a
"Subsequent Placement").
(b) From the end of the Blockout Period until the two year anniversary
of the end of the Blockout Period, the Company will not, directly or indirectly,
effect any Subsequent Placement unless the Company shall have first complied
with this Section 6.5(b).
(i) The Company shall deliver to each Principal Purchaser a written
notice (the "Offer") of any proposed or intended issuance or sale or
exchange of the securities being offered (the "Offered Securities") in a
Subsequent Placement, which Offer shall (w) identify and describe the
Offered Securities, (x) describe the price and other terms upon which they
are to be issued, sold or exchanged, and the number or amount of the
Offered Securities to be issued, sold or exchanged, (y) identify the
persons or entities (if known) to which or with which the Offered
Securities are to be offered, issued, sold or exchanged and (z) offer to
issue and sell to or exchange with the Principal Purchasers (A) (1) with
respect to the period from the end of the Blockout Period until the one
year anniversary of the end of the Blockout Period, a pro rata portion of
the Offered Securities, and (2) with respect to the period from the one
year anniversary of the end of the Blackout Period until the two year
anniversary of the end of the Blockout Period, a pro rata portion of an
amount equal to fifty percent (50%) of the Offered Securities, in each case
based on such Principal Purchaser's pro rata portion of the aggregate
purchase price paid by the Principal Purchasers for all of the Shares
purchased by the Principal Purchasers hereunder (the "Basic Amount"), and
(b) with respect to each Principal Purchaser that elects to purchase its
Basic Amount, any additional portion of the Offered Securities attributable
to the Basic Amounts of other Principal Purchasers as such Principal
Purchaser shall indicate it will purchase or acquire should the other
Principal Purchasers subscribe for less than their Basic Amounts (the
"Undersubscription Amount").
(ii) To accept an Offer, in whole or in part, a Principal Purchaser
must deliver a written notice to the Company prior to the end of the five
(5) Trading Day period of the Offer (the "Offer Period"), setting forth the
portion of the Purchaser's Basic Amount that such Principal Purchaser
elects to purchase and, if such Principal Purchaser shall elect to purchase
all of its Basic Amount, the Undersubscription Amount, if any, that such
Principal Purchaser elects to purchase (in either case, the "Notice of
Acceptance"). If the Basic Amounts subscribed for by all Principal
Purchasers are less than the total of all of the Basic Amounts, then each
Principal Purchaser who has set forth an Undersubcription Amount in its
Notice of Acceptance shall be entitled to purchase, in addition to the
Basic Amounts subscribed for, the Undersubscription Amount it has
subscribed for; provided, however, that if the Undersubscription Amounts
subscribed for exceed the difference between the total of all the Basic
Amounts and the Basic Amounts subscribed for (the "Available
25
Undersubscription Amount"), each Principal Purchaser who has subscribed for
any Undersubscription Amount shall be entitled to purchase only that
portion of the Available Undersubscription Amount as the Basic Amount of
such Principal Purchaser bears to the total Basic Amounts of all Principal
Purchasers that have subscribed for Undersubscription Amounts, subject to
rounding by the Board of Directors to the extent its deems reasonably
necessary. If requested by the Company, a Principal Purchaser shall
promptly confirm in writing any decision not to purchase Offered
Securities.
(iii) The Company shall have ten (10) Trading Days from the expiration
of the Offer Period above to offer, issue, sell or exchange all or any part
of such Offered Securities as to which a Notice of Acceptance has not been
given by the Principal Purchasers (the "Refused Securities"), but only to
the offerees described in the Offer (if so described therein) and only upon
terms and conditions (including, without limitation, unit prices and
interest rates) that are not more favorable to the acquiring person or
persons or less favorable to the Company than those set forth in the Offer.
(iv) In the event the Company shall propose to sell less than all the
Refused Securities (any such sale to be in the manner and on the terms
specified in Section 6.5(b)(iii) above), then each Principal Purchaser may,
at its sole option and in its sole discretion, reduce the number or amount
of the Offered Securities specified in its Notice of Acceptance to an
amount that shall be not less than the number or amount of the Offered
Securities that the Principal Purchaser elected to purchase pursuant to
Section 6.5(b)(ii) above multiplied by a fraction, (i) the numerator of
which shall be the number or amount of Offered Securities the Company
actually proposes to issue, sell or exchange (including Offered Securities
to be issued or sold to Principal Purchasers pursuant to Section 6.5(b)(ii)
above prior to such reduction) and (ii) the denominator of which shall be
the original amount of the Offered Securities. In the event that any
Principal Purchaser so elects to reduce the number or amount of Offered
Securities specified in its Notice of Acceptance, the Company may not
issue, sell or exchange more than the reduced number or amount of the
Offered Securities unless and until such securities have again been offered
to the Principal Purchasers in accordance with Section 6.5(b)(i) above.
(v) Upon the closing of the issuance, sale or exchange of all or less
than all of the Refused Securities, the Principal Purchasers shall acquire
from the Company, and the Company shall issue to the Principal Purchasers,
the number or amount of Offered Securities specified in the Notices of
Acceptance, as reduced pursuant to Section 6.5(b)(iv) above if the
Principal Purchasers have so elected, upon the terms and conditions
specified in the Offer. The purchase by the Principal Purchasers of any
Offered Securities is subject in all cases to the preparation, execution
and delivery by the Company and the Principal Purchasers of a purchase
agreement relating to such Offered Securities reasonably satisfactory in
form and substance to the Principal Purchasers and their respective
counsel.
(vi) Any Offered Securities not acquired by the Principal Purchasers or
other persons in accordance with Section 6.5(b)(iii) above may not be
issued, sold or exchanged until they are again offered to the Principal
Purchasers under the procedures specified in this Agreement.
26
(vii) Anything in this Section 6.5 to the contrary notwithstanding, the
rights of the Principal Purchasers in this Section 6.5 are subordinate and
subject to the preemptive rights of the holders of the Series 2 Preferred
Stock to purchase up to five percent of any offering of Common Stock or
Common Stock Equivalents.
(c) The restrictions contained in paragraphs (a) and (b) of this
Section 6.5 shall not apply to the issuance of Excluded Stock.
6.6 Securities Laws Disclosure; Publicity.
The Company shall, on or before 9:30 a.m., Eastern Standard Time, on
the Closing Date, issue a press release reasonably acceptable to the Purchasers
disclosing all material terms of the transactions contemplated hereby. Within
one Trading Day after the Closing Date, the Company shall file a Current Report
on Form 8-K with the Commission (the "8-K Filing") describing the terms of the
transactions contemplated by the Transaction Documents and including as exhibits
to such Current Report on Form 8-K this Agreement and the form of Warrants, in
the form required by the Exchange Act. Thereafter, the Company shall timely file
any filings and notices required by the Commission or applicable law with
respect to the transactions contemplated hereby and provide copies thereof to
the Special Counsel promptly after filing. The Company shall, at least two
Trading Days prior to the filing or dissemination of any disclosure required by
this paragraph, provide a copy thereof to the Special Counsel for its review,
except that with respect to the press release and 8-K Filing, such period can be
less to the extent necessary to make such filings timely pursuant to this
Section 6.6. The Company and the Purchasers, through its Special Counsel, shall
consult with each other in issuing any press releases or otherwise making public
statements or filings and other communications with the Commission or any
regulatory agency or Trading Market with respect to the transactions
contemplated hereby, and no party shall issue any such press release or
otherwise make any such public statement, filing or other communication without
the prior consent of the other, except if such disclosure is required by law, in
which case the disclosing party shall promptly provide the other party with
prior notice of such public statement, filing or other communication.
Notwithstanding the foregoing, the Company shall not publicly disclose the name
of any Purchaser, or include the name of any Purchaser in any filing with the
Commission or any regulatory agency or Trading Market, without the prior written
consent of such Purchaser, except (a) to the extent that such disclosure is
consistent with disclosure that has previously been authorized under this
Section or (b) to the extent such disclosure is required by law or Trading
Market regulations, in which case the Company shall provide the Special Counsel
with prior notice of such disclosure. The Company shall not, and shall cause
each of its Subsidiaries and its and each of their respective officers,
directors, employees and agents not to, provide any Purchaser with any material
nonpublic information regarding the Company or any of its Subsidiaries from and
after the filing of the 8-K Filing without the express written consent of such
Purchaser, other than as may be necessary to satisfy the Company's obligation
under Section 6.5. In the event of a breach of the foregoing covenant, or the
failure to disclose any material non-public information provided pursuant to
Section 6.5 on the related closing date, by the Company, any of its
Subsidiaries, or any of its or their respective officers, directors, employees
and agents, in addition to any other remedy provided herein or in the
Transaction Documents, a Purchaser shall have the right to require the Company
to make a public disclosure of such information and, if the Company has not
publicly disclosed such information by the later of (i) 24 hours after such
27
request and (ii) 5:30 p.m. (New York City time) on the next Trading Day after
such request, the requesting Purchaser may disclose such information in the form
of a press release, public advertisement or otherwise, of such material
nonpublic information without the prior approval by the Company, its
Subsidiaries, or any of its or their respective officers, directors, employees
or agents. No Purchaser shall have any liability to the Company, its
Subsidiaries, or any of its or their respective officers, directors, employees,
shareholders or agents for any such disclosure. Subject to the foregoing, the
Company and the Purchasers shall not issue any press releases or any other
public statements with respect to the transactions contemplated hereby;
provided, however, that the Company shall be entitled, without the prior
approval of any Purchaser, to make any press release or other public disclosure
with respect to such transactions (i) in substantial conformity with the 8-K
Filing and (ii) as is required by applicable law and regulations. Each press
release disseminated during the three years preceding the date of this Agreement
did not at the time of release contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they are made, not misleading.
6.7 Additional Issuance of Shares
(a) In the event that after the date hereof and prior to the first
anniversary of the date hereof the Company issues or agrees to issue any Common
Stock or Common Stock Equivalents, other than Excluded Stock, for a
consideration (net of any discounts, fees, and commissions) to the Company per
share less than the Reference Price (the "Issuance Price"), each Purchaser shall
be entitled to receive such number of additional shares of Common Stock (upon
payment to the Company of an amount per share equal to the par value of such
additional shares of Common Stock), equal to the excess of (A) the quotient
obtained by dividing the aggregate purchase price plus exercise price paid by
such Purchaser for such Purchaser's Eligible Shares (it being assumed for this
purpose that no portion of the purchase price is attributable to the Warrants)
divided by the Issuance Price over (B) the number of Eligible Shares then held
by such Purchaser.
(b) For purposes of any issuances of additional shares of Common Stock
to a Purchaser under Section 6.7(a) above, the following provisions shall be
applicable:
(i) In connection with any issuance of any Common Stock Equivalents,
(x) the maximum number of shares of Common Stock potentially issuable at
any time upon conversion, exercise or exchange of such Common Stock
Equivalents (the "Deemed Number") shall be deemed to be outstanding upon
issuance of such Common Stock Equivalents, and (y) the amount of the
consideration received by the Company with respect to such Common Stock
Equivalents shall be deemed to equal the aggregate minimum dollar value of
consideration payable to the Company to purchase such Common Stock
Equivalents and to convert, exercise or exchange them into Common Stock
(the "Deemed Consideration"). With respect to the issuance of any Common
Stock Equivalents, the Issuance Price shall be calculated by dividing the
Deemed Consideration by the Deemed Number. With respect to the issuance of
any Common Stock Equivalents and Common Stock, the Issuance Price shall be
calculated by dividing (A) the sum of (I) the amount of consideration
received by the Company for the Common Stock and (II) the Deemed
28
Consideration by (B) the sum of (I) the number of shares of Common Stock
sold in such transaction and (II) the Deemed Number. No further adjustment
shall be made under this Section upon the actual issuance of Common Stock
upon conversion, exercise or exchange of such Common Stock Equivalents.
(ii) In the case of the issuance of Common Stock or Common Stock
Equivalents for a consideration in whole or in part other than cash,
including securities acquired in exchange therefor (other than securities
by their terms so exchangeable), the consideration other than cash shall be
deemed to be the fair market value thereof as determined in good faith by
the Board of Directors of the Company, irrespective of any accounting
treatment.
(c) For purposes of this Section 6.7, the following definitions shall
apply:
"Eligible Shares" shall mean, for each Purchaser, at the time of
an issuance of additional shares of Common Stock or Convertible
Securities, the sum of (x) the lesser of (A) the number of shares of
Common Stock then held by such Purchaser and its Affiliates (other than
shares of Common Stock (i) acquired by such Purchaser upon exercise of
a Warrant or (ii) issued to such Purchaser pursuant to this Section 6.7
or (iii) purchased by such Purchaser on the open market or otherwise
(other than purchases which can be matched against any sale occurring
within three Trading Days thereof)) and (B) the number of Shares
purchased by such Purchaser hereunder and (y) the number of shares of
Common Stock acquired by such Purchaser upon exercise of a Warrant or
issued to such Purchaser pursuant to this Section 6.7. Upon request of
the Company, each Purchaser shall provide the Company with a written
certification of the number of Eligible Shares then held by such
Purchaser and such supporting information as the Company may reasonable
request.
"Reference Price" shall initially be $5.462 and, at any time after
additional shares of Common Stock are issued to a Purchaser pursuant to
this Section 6.7, shall be equal to the lowest Issuance Price.
(d) Notwithstanding anything to the contrary contained in this Section
6.7, the number of shares of Common Stock that shall be issued to a Purchaser
pursuant hereto shall be limited to the extent necessary to insure that,
following such issuance, the total number of shares of Common Stock then
beneficially owned by such Purchaser and its Affiliates and any other Persons
whose beneficial ownership of Common Stock would be aggregated with the
Purchaser's for purposes of Sections 13(d) of the Exchange Act, does not exceed
4.999% (the "Maximum Percentage") of the total number of issued and outstanding
shares of Common Stock (including for such purpose the shares of Common Stock
issuable upon exercise of all Warrants and other Convertible Securities held by
such Purchaser and its Affiliates and any other Persons whose beneficial
ownership of Common Stock would be so aggregated). For such purposes, beneficial
ownership shall be determined in accordance with Section 13(d) of the Exchange
Act and the rules and regulations promulgated thereunder. The Company's
obligation to issue shares in excess of the foregoing limitation shall be
suspended until such time, if any, as such shares of Common Stock may be issued
in compliance with such limitation. Additionally, by written notice to the
Company, the Purchaser may waive the provisions of this Section or increase or
29
decrease (but not below 4.999%) the Maximum Percentage to any other percentage
specified in such notice, but (i) any such waiver or increase will not be
effective until the 61st day after such notice is delivered to the Company, and
(ii) any such waiver or increase or decrease will apply only to the Purchaser
and not to any other Purchaser.
(e) All shares to be issued pursuant to this Section 6.7, upon
issuance, shall be validly issued, fully-paid and non-assessable and free of any
Liens or preemptive or similar rights. Upon the issuance of any shares of Common
Stock pursuant to this Section 6.7, such shares shall be "Shares" and
"Registrable Securities" for all purposes hereunder. Without limiting the
generality of the foregoing, the Purchasers shall have all of the rights
provided in the Registration Rights Agreement with respect to such additional
Shares, mutatis mutandis.
6.8 Trading Market Limitations.
(a) Notwithstanding any provisions of Section 6.7, to the contrary, if
the Trading Market is the Nasdaq National Market or the Nasdaq SmallCap Market
or any other market or exchange with similar applicable rules, then the maximum
number of shares of Common Stock that the Company may issue pursuant to the
Transaction Documents at an effective purchase price less than the Closing Price
on the Trading Day immediately preceding the Closing Date is 9,572,408 shares of
Common Stock (the "Issuable Maximum"), unless the Company obtains shareholder
approval in accordance with the rules and regulations of such Trading Market
(the "Shareholder Approval Requirement"). If at the time any Purchaser requests
an exercise of any Securities or additional shares of Common Stock become
issuable pursuant to Section 6.7 hereof or under any Transaction Document, the
Actual Minimum (excluding any shares issued or issuable at an effective purchase
price in excess of the Closing Price on the Trading Day immediately preceding
the Closing Date) exceeds the Issuable Maximum (and if the Company has not
previously obtained the required shareholder approval), then the Company shall
issue to the Purchaser requesting such exercise or entitled to such additional
shares a number of shares of Common Stock not exceeding such Purchaser's
pro-rata portion of the Issuable Maximum (based on such Purchaser's share
(vis-a-vis other Purchasers) of the aggregate purchase price paid hereunder and
taking into account any Warrant Shares previously issued to such Purchaser), and
the remainder of the Warrant Shares issuable in connection with such exercise or
additional shares of Common Stock issuable pursuant to Section 6.7 shall
constitute "Excess Shares" pursuant to Section 6.8(b) below.
(b) In the event that any Purchaser's receipt of shares of Common Stock
upon exercise of Securities or pursuant to Section 6.7 is restricted based on
the Issuable Maximum, the Company shall either: (i) use its reasonable best
efforts to obtain the required shareholder approval necessary to permit the
issuance of such Excess Shares as soon as is reasonably possible, but in any
event not later than the 90th day after the event giving rise to such Excess
Shares, or (ii) within five Trading Days after such event, pay cash to such
Purchaser, as liquidated damages and not as a penalty, in an amount equal to the
number of Excess Shares multiplied by the average Closing Price over the five
Trading Days immediately prior to the date of such event or, if greater, the
five Trading Days immediately prior to the date of payment (the "Cash Amount").
If the Company elects the first option under the preceding sentence and the
Company fails to obtain the required shareholder approval on or prior to the
90th day after such event, then within three Trading Days after such 90th day,
the Company shall pay the Cash Amount to such Purchaser, as liquidated damages
30
and not as penalty; provided, however, that the Company shall not be required to
pay the Cash Amount to the extent such payment would violate the Shareholder
Approval Requirement or subject the Company to delisting under the rules and
interpretations of the Trading Market on which the Company's Common Stock is
listed and thereafter the Company shall have no obligation with respect to such
Excess Shares.
SECTION 7. Negative Covenants.
7.1 Private Placement Status.
Neither the Company nor any agent or other Person acting on the
Company's behalf will do or cause to be done (or will omit to do or to cause to
be done) any act, which act (or which omission) would result in bringing the
issuance or sale of the Securities and Warrant Shares within the provisions of
Section 5 of the Securities Act or the filing, notification or reporting
requirements of any state securities law.
7.2 Actions Prior to the Closing Date.
From the date hereof through the Closing Date, the Company will not,
(a) issue or agree to issue any capital stock or any securities exercisable for,
or convertible or exchangeable into, capital stock or (b) purchase, redeem or
otherwise acquire any of its capital stock; provided, however, that this Section
7.2 shall not limit, or be applicable to, (i) the transactions contemplated by
this Agreement, (ii) grants of options or issuances of Common Stock to officers,
directors or employees of the Company pursuant to the current terms of the
Company's 1995 Stock Incentive Plan, the Company's 1999 Equity Incentive Plan
and the 2001 Employee Stock Purchase Plan and (iii) the conversion of the Series
2 Preferred Stock or the exercise of existing warrants or options.
SECTION 8. Conditions to Purchaser's Obligations.
Each Purchaser's obligation to purchase Securities hereunder is subject
to satisfaction of the following conditions at the Closing (any of which may be
waived by each such Purchaser):
8.1 Registration Rights Agreement.
The Company shall have entered into a Registration Rights Agreement
with the Purchasers substantially in the form of Exhibit B hereto and it shall
be in full force and effect.
8.2 Certificates for Shares.
The Purchaser shall concurrently receive (a) the certificates for
Shares (or shall have received a certificate from the Company's transfer agent
certifying as to the issuance of the Shares) and (b) a Warrant, in each case as
contemplated by Section 2(b) hereof.
31
8.3 Accuracy of Representations and Warranties.
The representations and warranties of the Company contained herein or
in any certificate or document delivered pursuant hereto shall be correct and
complete on and as of the Closing Date with the same effect as though made on
and as of such date (except to the extent made as of specific date, in which
event they shall be correct and complete on and as of such date).
8.4 Compliance with Agreements.
The Company shall have performed and complied in all material respects
with all agreements, covenants and conditions contained in this Agreement and
any other document contemplated hereby or thereby that are required to be
performed or complied with by the Company on or before the Closing Date.
8.5 Officers' Certificates.
(a) The Purchaser shall have received a certificate dated the Closing
Date and signed by the President or Chief Executive Officer and by the Secretary
or the Treasurer of the Company, to the effect that the conditions of Sections
8.3, 8.4, 8.7 (second sentence only) and 8.8 have been satisfied.
(b) The Purchaser shall have received a certificate dated the Closing
Date and signed by the Secretary of the Company certifying (i) the certificate
of incorporation and bylaws of the Company as in effect on the Closing Date,
(ii) all resolutions of the Board of Directors of the Company (and committees
thereof) relating to this Agreement and the transactions contemplated thereby
and (iii) the incumbency of all officers of the Company executing this
Agreement, the Registration Rights Agreement and any other agreement or document
contemplated thereby.
8.6 Proceedings.
All corporate and other proceedings in connection with the transactions
contemplated by this Agreement, and all documents incident thereto, shall be in
form and substance satisfactory to the Purchaser and its counsel, and the
Purchaser shall have received all such originals or certified or other copies of
such documents as the Purchaser or its counsel may reasonably request.
8.7 Legality; Governmental and Other Authorization.
The purchase of and payment for the Securities shall not be prohibited
by any law or governmental order, rule, ruling, regulation, release,
interpretation or opinion applicable to the Purchaser and shall not subject the
Purchaser to any penalty, tax, liability or other onerous condition. No legal
action, suit or proceeding shall be pending or threatened which seeks to
restrain or prohibit the transactions contemplated by this Agreement. Any
necessary consents, approvals, licenses, permits, orders and authorizations of,
and any filings, registrations or qualifications with, any governmental or
administrative agency or other Person, with respect to the transactions
contemplated by this Agreement shall have been obtained or made and shall be in
full force and effect. The Company shall have delivered to the Purchaser, upon
its reasonable request setting forth what is required, factual certificates or
32
other evidence, in form and substance satisfactory to the Purchaser and its
counsel, to enable the Purchaser to establish compliance with this condition.
8.8 No Material Adverse Change.
There shall have been no material adverse change in the assets,
properties, liabilities, business, affairs, results of operations, condition
(financial or otherwise) or prospects of the Company since December 31, 2002.
8.9 Opinion of Counsel.
The Purchaser shall have received an opinion, dated the Closing Date
and addressed to the Purchasers, of Blank Rome LLP, counsel for the Company,
which opinion shall be in form and substance substantially as set forth in
Exhibit C hereto.
8.10 Transfer Agent Instruction.
The Purchaser shall have received duly executed Transfer Agent
Instructions acknowledged by the Company's transfer agent.
8.11 Other Documents and Opinions.
The Purchaser shall have received such other documents and opinions, in
form and substance reasonably satisfactory to the Purchaser and its counsel,
relating to matters incident to the transactions contemplated hereby as the
Purchaser may reasonably request.
8.12 Investments by Principal Purchasers.
With respect to the obligation to close of each Purchaser, the
Principal Purchasers who are parties to this Agreement shall simultaneously make
payment in full to the Company of their respective amounts set forth in Schedule
1 hereto.
SECTION 9. Breach of Representations, Warranties and Covenants
(a) The representations, warranties, covenants and agreements of the
Company and the Purchasers contained in this Agreement, the Registration Rights
Agreement and the Warrants or in any document or certificate delivered pursuant
hereto or thereto or in connection herewith shall survive the Closing Date, and
shall continue in effect following, the execution and delivery of this
Agreement, the Registration Rights Agreement and the Warrants, any investigation
at any time made by any of the Purchasers or on its behalf or by any other
Person, the issuance, sale and delivery of the Securities, any disposition
thereof and any payment, conversion or cancellation of the Securities. All
statements contained in any certificate or other closing document delivered by
or on behalf of the Company pursuant hereto shall constitute representations and
warranties by the Company hereunder.
(b) If any Purchaser or any of its Affiliates or any officer, director,
partner, controlling person, employee or agent of a Purchaser or any of its
Affiliates (a "Related Person") becomes involved in any capacity in any
Proceeding brought by any Person (other than the Purchasers and their Related
33
Persons) directly in connection with or as a result of the transactions
contemplated by the Transaction Documents (other than relating to the
Registration Statement, prospectus or other matter covered by the indemnity in
Section 2.7 of the Registration Rights Agreement), the Company will indemnify
and hold harmless such Purchaser or Related Person for its reasonable legal and
other expenses (including the reasonable costs of any investigation, preparation
and travel) and for any Losses incurred in connection therewith, if and as such
expenses or Losses are actually incurred, excluding only Losses that arise out
of or result directly from such Purchaser's or Related Person's gross negligence
or willful misconduct. In addition, the Company shall indemnify and hold
harmless each Purchaser and Related Person from and against any and all Losses,
if and as actually incurred, arising out of or relating to any breach by the
Company of any of the representations, warranties or covenants made by the
Company in this Agreement or any other Transaction Document. The conduct of any
Proceedings for which indemnification is available under this paragraph shall be
governed by Section 2.7(c) of the Registration Rights Agreement. The
indemnification obligations of the Company under this paragraph shall be in
addition to any liability that the Company may otherwise have and shall be
binding upon and inure to the benefit of any successors, assigns, heirs and
personal representatives of the Purchasers and any such Related Persons. The
Company also agrees that neither the Purchasers nor any Related Persons shall
have any liability to the Company or any Person asserting claims on behalf of or
in right of the Company in connection with or as a result of the transactions
contemplated by the Transaction Documents, except to the extent that any Losses
incurred by the Company arise out of or result directly from the gross
negligence or willful misconduct of the applicable Purchaser or Related Person
in connection with such transactions or arise out of or relate to any breach by
a Purchaser of any of the representations, warranties or covenants made by a
Purchaser in this Agreement or any other Transaction Document. If the Company
breaches its obligations under any Transaction Document, then, in addition to
any other liabilities the Company may have under any Transaction Document or
applicable law, the Company shall pay or reimburse the Purchasers on demand for
all costs of collection and enforcement (including reasonable attorneys fees and
expenses) actually incurred and reasonably documented. Without limiting the
generality of the foregoing, the Company specifically agrees to reimburse the
Purchasers on demand for all actually incurred and reasonably documented costs
of enforcing the indemnification obligations in this paragraph.
SECTION 10. Termination
10.1 Termination of Agreement.
Subject to Section 10.2 hereof, this Agreement may be terminated by
notice in writing at any time prior to the Closing by:
(a) the Purchasers or the Company, if the Closing shall not have
occurred on or before May 16, 2003; provided, however, that the right to
terminate this Agreement under this Section 10.1(a) shall not be available to
any party whose failure to fulfill any obligation under this Agreement has been
the cause of, or resulted in, the failure of the Closing to occur on or before
such date;
34
(b) the Purchasers or the Company, if any Governmental Authority of
competent jurisdiction shall have issued any judgment, injunction, order, ruling
or decree or take any other action restraining, enjoining or otherwise
prohibiting the consummation of the transactions contemplated by this Agreement
or the Registration Rights Agreement and such judgment, injunction, order,
ruling, decree or other action becomes final and nonappealable; provided that
the party seeking to terminate this Agreement pursuant to this clause (b) shall
have used its reasonable best efforts to have such judgment, injunction, order,
ruling or decree lifted, vacated or denied;
(c) the Purchasers or the Company, if the Purchasers and the Company so
mutually agree in writing.
10.2 Effect of Termination.
(a) If this Agreement is terminated in accordance with Section 10.1
hereof and the transactions contemplated hereby are not consummated, this
Agreement shall become null and void and of no further force and effect except
that (i) the terms and provisions of this Section 10.2 and Sections 9, 11, 12
and 14 hereof shall remain in full force and effect and (ii) any termination of
this Agreement shall not relieve any party hereto from any liability for any
breach of its obligations hereunder.
SECTION 11. Specific Performance
The parties agree that irreparable damage will result in the event that
this Agreement is not specifically enforced, and the parties agree that any
damages available at law for a breach of this Agreement would not be an adequate
remedy. Therefore, the provisions hereof and the obligations of the parties
hereunder shall be enforceable in a court of equity, or other tribunal with
jurisdiction, by a decree of specific performance, and appropriate injunctive
relief may be applied for and granted in connection therewith. Such remedies and
all other remedies provided for in this Agreement shall, however, be cumulative
and not exclusive and shall be in addition to any other remedies that a party
may have under this Agreement or otherwise.
SECTION 12. Expenses
(a) At the Closing, the Company shall pay to Mainfield Enterprises,
Inc. an aggregate of $25,000 for their legal fees and expenses incurred in
connection with its due diligence and the preparation and negotiation of the
Transaction Documents upon presentation to the Company of an invoice therefor.
In lieu of the foregoing payment, Mainfield Enterprises, Inc. may retain such
amount at the Closing or require the Company to pay such amount directly to
Special Counsel upon presentation to the Company of an invoice therefor. Except
as expressly set forth in the Transaction Documents to the contrary, each party
shall pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this Agreement.
(b) The Company agrees to pay, or to cause to be paid, all transfer
agent fees, documentary, stamp and other similar Taxes, other than transfer
taxes payable upon the transfer by a Purchaser of Securities or Warrant Shares
35
to a transferee, levied under the laws of the United States of America, any
state or local Taxing Authority thereof or therein or any other applicable
jurisdiction in connection with the issuance and sale of the Securities and the
Warrant Shares and the execution and delivery of each Transaction Document and
any other documents or instruments contemplated hereby or thereby and any
modification of and Transaction Document or any such other documents or
instruments and will hold each Purchaser harmless without limitation as to time
against any and all liabilities with respect to all such Taxes.
(c) The obligations of the Company under this Section 12 shall survive
any Closing hereunder and any termination of this Agreement.
SECTION 13. Amendments and Waivers
(a) The terms and provisions of this Agreement may be amended, waived,
modified or terminated only with the written consent of the holders of more than
70% of the aggregate outstanding Shares and Warrant Shares (including for this
purpose, Warrant Shares issuable upon exercise of outstanding Warrants);
provided, however, that no such amendment, waiver, modification or termination
shall change this Section 13(a) without the written consent of the holders of
all the Securities and Warrant Shares then outstanding.
(b) Promptly after obtaining the written consent of the holders as
herein provided, the Company shall transmit a copy of any amendment, waiver,
modification or termination that has been adopted to all holders of Securities
and Warrant Shares then outstanding, but failure to transmit copies shall not in
any way affect the validity of any such amendment, waiver, modification or
termination.
SECTION 14. Notices
All notices, requests, demands, consents or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (a) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section prior to 5:30 p.m. (New York City
time) on a Trading Day, (b) the next Trading Day after the date of transmission,
if such notice or communication is delivered via facsimile at the facsimile
number specified in this Section on a day that is not a Trading Day or later
than 5:30 p.m. (New York City time) on any Trading Day, (c) the Trading Day
following the date of mailing, if sent by U.S. nationally recognized overnight
courier service, or (d) upon actual receipt by the party to whom such notice is
required to be given. The addresses for such notices and communications are, (i)
if to the Company, to Impax Laboratories, Inc., 3735 Castor Avenue,
Philadelphia, PA, 19124, telecopy: 215-289-5932, Attention: Barry R. Edwards,
Co-Chief Executive, with a copy to Blank Rome LLP, One Logan Square,
Philadelphia, PA 19103-6998, telecopy: 215-832-5555, Attention: Francis E. Dehel
or (ii) if to a Purchaser, at the address indicated on the applicable signature
page hereto, or at such other address as a party may from time to time designate
as its address in writing to the other party to this Agreement, with a copy to
Proskauer Rose LLP, 1585 Broadway, New York, New York 10036, telecopy:
212-969-2900, Attention: Adam J. Kansler, Esq.
36
SECTION 15. Miscellaneous
(a) The Transaction Documents and, upon any closing hereunder together
with any further agreements entered into by the Purchasers and the Company at
any closing hereunder, contain the entire agreement between the Purchasers and
the Company, and supersede any prior oral or written agreements, commitments,
terms or understandings, regarding the subject matter hereof, including without
limitation any term sheet.
(b) Any provision of this Agreement that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law, the parties
hereby waive any provision of law that may render any provision hereof
prohibited or unenforceable in any respect.
(c) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, whether so
expressed or not; provided, that (a) the Company may not assign any of its
rights, duties or obligations under this Agreement, except with the Purchasers'
written consent, which may be withheld for any reason, and (b) a Purchaser may
assign any of its rights, duties or obligations under this Agreement to any
transferee of its Securities or Warrant Shares and (unless such assignment
expressly provides otherwise) any such assignment shall not diminish the rights
such Purchaser would otherwise have under this Agreement or with respect to any
remaining Securities or Warrant Shares held by such Purchaser. In the event that
any Securities or Warrant Shares are transferred either (a) in a public offering
pursuant to a Registration Statement under Section 5 of the Securities Act, (b)
pursuant to a Rule 144 Transaction, or (c) pursuant to another transaction
exempt from the registration and prospectus delivery requirements of the
Securities Act under Section 4(1) thereof so that all transfer restrictions and
restrictive legends with respect to such Securities or Warrant Shares, if any,
are removed upon the consummation of such sale or transfer, then the transferees
of such Securities or Warrant Shares, as the case may be, shall not be entitled
to any benefits under this Agreement or the Registration Rights Agreement with
respect to such Securities or Warrant Shares and such Securities or Warrant
Shares shall no longer be considered to be "Outstanding" for purposes of any
consent or waiver provision of this Agreement or the Registration Rights
Agreement.
(d) No course of dealing and no delay on the part of any party hereto
in exercising any right, power, or remedy conferred by this Agreement shall
operate as a waiver thereof or otherwise prejudice such party's rights, powers
and remedies. No single or partial exercise of any right, power or remedy
conferred by this Agreement shall preclude any other or further exercise thereof
or the exercise of any other right, power or remedy.
(e) The headings and captions in this Agreement are for convenience of
reference only and shall not define, limit or otherwise affect any of the terms
or provisions hereof.
37
(f) This Agreement is for the sole benefit of the parties hereto and
their respective successors and permitted assigns and nothing herein, express or
implied, is intended or shall confer upon any other Person any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reasons
of this Agreement.
(g) This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute one and the same instrument,
and all signatures need not appear on any one counterpart.
(h) This Agreement is intended for the benefit of the parties hereto
and their respective successors and permitted assigns and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person, except that
each Related Person is an intended third party beneficiary of Section 9(b) and
may enforce the provision of such Section directly against the parties with
obligations thereunder.
(i) ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT
AND INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (OTHER THAN ANY
CONFLICT OF LAW RULES THAT MIGHT RESULT IN THE APPLICATION OF THE LAWS OF ANY
OTHER JURISDICTION). THE COMPANY AND PURCHASERS HEREBY IRREVOCABLY SUBMIT TO THE
EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF
NEW YORK, BOROUGH OF MANHATTAN FOR THE ADJUDICATION OF ANY DISPUTE BROUGHT BY
THE COMPANY OR ANY PURCHASER HEREUNDER, IN CONNECTION HEREWITH OR WITH ANY
TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO
THE ENFORCEMENT OF ANY OF THE TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY
WAIVE, AND AGREE NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING BROUGHT BY THE
COMPANY OR ANY PURCHASER, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT, OR THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW. THE COMPANY AND PURCHASERS HEREBY WAIVE ALL RIGHTS TO A TRIAL
BY JURY.
(j) If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Agreement shall not in any way be affected or
impaired thereby and the parties will attempt to agree upon a valid and
enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.
38
(k) Notwithstanding anything to the contrary contained in (and without
limiting any similar provisions of) the Transaction Documents, whenever any
Purchaser exercises a right, election, demand or option under a Transaction
Document and the Company does not timely perform its related obligations within
the periods therein provided, then such Purchaser may rescind or withdraw, in
its sole discretion from time to time upon written notice to the Company, any
relevant notice, demand or election in whole or in part without prejudice to its
future actions and rights.
(l) If any certificate or instrument evidencing any Securities or
Warrant Shares is mutilated, lost, stolen or destroyed, the Company shall issue
or cause to be issued in exchange and substitution for and upon cancellation
thereof, or in lieu of and substitution therefor, a new certificate or
instrument, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and customary indemnity, if
requested. The applicants for a new certificate or instrument under such
circumstances shall also pay any reasonable third-party costs associated with
the issuance of such replacement Securities or Warrant Shares.
(m) To the extent that the Company makes a payment or payments to any
Purchaser hereunder or pursuant to the Warrants or any Purchaser enforces or
exercises its rights hereunder or thereunder, and such payment or payments or
the proceeds of such enforcement or exercise or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside,
recovered from, disgorged by or are required to be refunded, repaid or otherwise
restored to the Company by a trustee, receiver or any other person under any law
(including, without limitation, any bankruptcy law, state or federal law, common
law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.
(n) In the event of any stock split, subdivision, dividend or
distribution payable in shares of Common Stock (or other securities or rights
convertible into, or entitling the holder thereof to receive directly or
indirectly shares of Common Stock), combination or other similar
recapitalization or event occurring after the date hereof, each reference in any
Transaction Document to a number of shares or a price per share shall be amended
to appropriately account for such event.
(o) The obligations of each Purchaser under any Transaction Document
are several and not joint with the obligations of any other Purchaser, and no
Purchaser shall be responsible in any way for the performance of the obligations
of any other Purchaser under any Transaction Document. The decision of each
Purchaser to purchase Shares pursuant to this Agreement has been made by such
Purchaser independently of any other Purchaser and independently of any
information, materials, statements or opinions as to the business, affairs,
operations, assets, properties, liabilities, results of operations, condition
(financial or otherwise) or prospects of the Company or of the Subsidiary which
may have been made or given by any other Purchaser or by any agent or employee
39
of any other Purchaser, and no Purchaser or any of its agents or employees shall
have any liability to any other Purchaser (or any other person) relating to or
arising from any such information, materials, statements or opinions. Nothing
contained herein or in any Transaction Document, and no action taken by any
Purchaser pursuant thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert or as
a group with respect to such obligations or the transactions contemplated by the
Transaction Document. Each Purchaser acknowledges that no other Purchaser has
acted as agent for such Purchaser in connection with making its investment
hereunder and that no other Purchaser will be acting as agent of such Purchaser
in connection with monitoring its investment hereunder. Each Purchaser shall be
entitled to independently protect and enforce its rights, including without
limitation the rights arising out of this Agreement or out of the other
Transaction Documents, and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose.
[SIGNATURE PAGES TO FOLLOW]
40
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.
IMPAX LABORATORIES, INC.
By: BARRY R. EDWARDS
------------------------------------
Name: Barry R. Edwards
Title: Co-Chief Executive Officer
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOR PURCHASERS FOLLOW]
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Vertical Ventures LLC
By: JOSHUA SILVERMAN
-------------------------------
Name: Joshua Silverman
Title: Manager
Address: 650 5th Avenue, 6th Floor
New York, NY 10019
Tax ID No.: 364466216
Contact Name: Josh Silverman
Telephone: 212-259-2660
Facsimile: 212-259-2695
Names in which Securities
should be Registered (if different):______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
WD Partnership, L.P.
By: Windcrest Discovery Investment LLC
By: JAMES H. GELLERT
-----------------------------------
Name: James H. Gellert
Title: Managing Member
Address: c/o Windcrest Discovery Investments LLC
122 East 42nd Street - 47th Floor
New York, NY 10168
Tax ID No.: 02-066-3333
Contact Name: James Gellert
Telephone: 212-599-4300
Facsimile: 212-599-4387
Names in which Securities
should be Registered (if different):______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Smithfield Fiduciary LLC
By: ADAM J. CHILL
----------------------------
Name: Adam J. Chill
Title: Authorized Signatory
Address: c/o Highbridge Capital Management, LLC
9 West 57th Street - 27th Floor
New York, NY 10019
Tax ID No.: N/A
Contact Name: Ari J. Storch / Adam J. Chill
Telephone: 212-287-4720
Facsimile: 212-751-0755
Names in which Securities
should be Registered (if different):______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Fleming US Discovery Fund III, L.P.
By: ROBERT L. BURR
----------------------------
Name: Robert L. Burr
Title:
Address: c/o Fleming US Discovery Partners, L.P.
c/o JPMorgan Partners
1221 Avenue of the Americas, 40th Floor
New York, NY 10020
Tax ID No.: 13-390-7673
Contact Name: Robert L. Burr
Telephone: 212-899-3266
Facsimile: 917-464-5917
Names in which Securities
should be Registered (if different):______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Fleming US Discovery Offshore Fund III, L.P.
By: ROBERT L. BURR
----------------------------
Name: Robert L. Burr
Title:
Address: c/o Fleming US Discovery Partners, L.P.
c/o JPMorgan Partners
1221 Avenue of the Americas, 40th Floor
New York, NY 10020
Tax ID No.: 13-393-6603
Contact Name: Robert L. Burr
Telephone: 212-899-3266
Facsimile: 917-464-5917
Names in which Securities
should be Registered (if different):______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
H&Q Life Sciences Investors
By: ALAN G. CARR
--------------------------------------------------
Name: Alan G. Carr
Title: President Emeritus
Address: c/o Hambrecht & Quist Capital Management LLC
30 Rowes Wharf, Suite 430
Boston, MA 02110
Tax ID No.: 04-3147016
Contact Name: Kim Carroll
Telephone: 617-772-8500
Facsimile: 617-772-8577
Names in which Securities
should be Registered (if different):______________________
The name H&Q Life Sciences Investors is the designation of the Trustees for the
time being under a Declaration of Trust dated February 20, 1992, as amended, and
all persons dealing with H&Q Life Sciences Investors must look solely to the
trust property for the enforcement of any claim against H&Q Life Sciences
Investors, as neither the Trustees, officers nor shareholders assume any
personal liability for the obligations entered into on behalf of H&Q Life
Sciences Investors.
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
H&Q Healthcare Investors
By: ALAN G. CARR
---------------------------
Name: Alan G. Carr
Title: President Emeritus
Address: c/o Hambrecht & Quist Capital Management LLC
30 Rowes Wharf, Suite 430
Boston, MA 02110
Tax ID No.: 04-6564285
Contact Name: Kim Carroll
Telephone: 617-772-8500
Facsimile: 617-772-8577
Names in which Securities
should be Registered (if different):______________________
The name H&Q Healthcare Investors is the designation of the Trustees for the
time being under an Amended and Restated Declaration of Trust dated April 12,
1987, as amended, and all persons dealing with H&Q Healthcare Investors must
look solely to the trust property for the enforcement of any claim against H&Q
Healthcare Investors, as neither the Trustees, officers nor shareholders assume
any personal liability for the obligations entered into on behalf of H&Q
Healthcare Investors.
{Signature Page to Common Stock and Warrant Purchase Agreement}
110967.00121/11213884v1
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Mainfield Enterprises, Inc.
By: AVI VIGDER
------------------------------
Name: Avi Vigder
Title: Authorized Signatory
Address: c/o Sage Capital Growth, Inc.
660 Madison Ave., 18th Floor
New York, NY 10021
Tax ID No.: N/A
Contact Name: Danny Golan
Telephone: 212-651-9000
Facsimile: 212-651-9010
Names in which Securities
should be Registered (if different):______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Rx Healthcare Partners I LP
By: Rx Associates LLC
-----------------------------------
General Partner
By: DAVID BLOOM
------------------------------
Name: David Bloom
Title:
Address: c/o Rx Capital Management LP
156 West 56th Street
New York, NY 10019
Tax ID No.: 41-2028374
Contact Name: Craig Rosmarin
Telephone: 212-484-2115
Facsimile: 212-484-2150
Names in which Securities
should be Registered (if different):_________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Rx Healthcare Partners II LP
By: Rx Associates LLC
---------------------------------
General Partner
By: DAVID BLOOM
----------------------------
Name: David Bloom
Title: Member
Address: c/o Rx Capital Management LP
156 West 56th Street
New York, NY 10019
Tax ID No.: 41-2028375
Contact Name: Craig Rosmarin
Telephone: 212-484-2115
Facsimile: 212-484-2150
Names in which Securities
should be Registered (if different):_________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Rx Healthcare Overseas Fund
By: Rx Capital Management LP
---------------------------------
Investment Manager
By: DAVID BLOOM
----------------------------
Name: David Bloom
Title: President
Address: c/o Rx Capital Management LP
156 West 56th Street
New York, NY 10019
Tax ID No.: N/A
Contact Name: Craig Rosmarin
Telephone: 212-484-2115
Facsimile: 212-484-2150
Names in which Securities
should be Registered (if different):_________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Ashford Capital Management, Inc. with discretion f/b/o
PEPCO Holding Retirement Plan Master Trust
By: THEODORE H. ASHFORD
-------------------------------
Name: Theodore H. Ashford
Title: Chairman & CEO
Address: Ashford Capital Management, Inc.
PO Box 4172
Wilmington, DE 19807
Tax ID No.: 52-6026507
Contact Name: Anthony M. Petrucci
Telephone: 302-655-1750
Facsimile: 302-655-4641
Names in which Securities
should be Registered (if different): Booth & Co.
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Ashford Capital Management, Inc. with discretion f/b/o
Anvil Investment Associates, L.P.
By: THEODORE H. ASHFORD
-------------------------------
Name: Theodore H. Ashford
Title: Anvil Management Co., LLC, General Partner
Address: Ashford Capital Management, Inc.
PO Box 4172
Wilmington, DE 19807
Tax ID No.: 06-1520893
Contact Name: Anthony M. Petrucci
Telephone: 302-655-1750
Facsimile: 302-655-4641
Names in which Securities
should be Registered (if different): Anvil Investment
Associates, L.P.
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Caduceus Capital Trust
By: Winchester Global Trust Company Limited, as Trustee
By: SUSAN E. GIBBONS
----------------------------
Name: Susan E. Gibbons
Title: Vice President
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 98-0198538
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):_______________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Caduceus Capital II, LP
By: OrbiMed Advisors LLC, General Partner
By: SAMUEL D. ISALY
------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 13-4012775
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
PW Eucalyptus Fund L.L.C.
By: OrbiMed Advisors LLC, JV Partner
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 13-4076723
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
PW Eucalyptus Fund, Ltd.
By: OrbiMed Advisors LLC, JV Partner
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.:
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Post Venture IV, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1577005
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Integrated Holdings V, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1583448
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Netherlands II, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1552047
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Integrated Holdings IV Post Venture, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1539694
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Post Venture III, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1494733
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Netherlands I, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1513678
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Netherlands III, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1580411
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Integrated Holdings II Limited
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.:
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Venture Capital IV, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1528772
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}
Accepted and Agreed to as of the
date first written above by the
undersigned Purchaser:
Knightsbridge Venture Capital III, L.P.
By: OrbiMed Advisors LLC
By: SAMUEL D. ISALY
--------------------------------
Name: Samuel D. Isaly
Title: Managing Member
Address: c/o OrbiMed Advisors, LLC
767 Third Avenue, 30th Floor
New York, NY 10017
Tax ID No.: 73-1494735
Contact Name: Andrew Kanarek
Telephone: 212-739-6400
Facsimile: 212-739-6444
Names in which Securities
should be Registered (if different):________________________
{Signature Page to Common Stock and Warrant Purchase Agreement}