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EXHIBIT 4.1
STOCK PURCHASE AGREEMENT
Esperion Therapeutics, Inc.
0000 X. Xxxxx Xxxxxx
000 XXX Xxxxx
Xxx Xxxxx, XX 00000
Ladies & Gentlemen:
The undersigned, _________________________________(the "Investor"),
hereby confirms its agreement with you as follows:
1. This Stock Purchase Agreement (the "Agreement") is made as of July
__, 2001 between Esperion Therapeutics, Inc., a Delaware corporation (the
"Company"), and the Investor.
2. The Company has authorized the sale and issuance of up to 3,500,000
shares (the "Shares") of common stock of the Company, $.001 par value per share
(the "Common Stock"), subject to adjustment by the Company, to certain investors
in a private placement (the "Offering").
3. The Company and the Investor agree that the Investor will purchase
from the Company and the Company will issue and sell to the Investor ___________
Shares, for a purchase price of $_______ per share, or an aggregate purchase
price of $_______________, pursuant to the Terms and Conditions for Purchase of
Shares attached hereto as Annex I and incorporated herein by reference as if
fully set forth herein (the "Terms and Conditions"). Unless otherwise requested
by the Investor, certificates representing the Shares purchased by the Investor
will be registered in the Investor's name and address as set forth below.
4. The Investor represents that, except as set forth below, (a) it has
had no position, office or other material relationship within the past three
years with the Company or persons known to it to be affiliates of the Company,
(b) neither it, nor any group of which it is a member or to which it is related,
beneficially owns (including the right to acquire or vote) any securities of the
Company and (c) it has no direct or indirect affiliation or association with any
NASD member as of the date hereof. Exceptions:
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(If no exceptions, write "none." If left blank, response will be deemed to be
"none.")
The Investor hereby confirms, by signing in the space provided below,
that the foregoing correctly sets forth the agreement between the Investor and
the Company with respect to the purchase of Shares in the Offering. By executing
this Agreement, the Investor acknowledges that the Company may use the
information in paragraph 4 above and the name and address information below in
preparation of the Registration Statement (as defined in Annex 1).
AGREED AND ACCEPTED:
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ESPERION THERAPEUTICS, INC. Investor:
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By:
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By: Print Name:
Title: -------------------------------------------------
Title:
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Address:
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Tax ID No.:
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Contact name:
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Telephone:
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Fax:
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E-mail:*
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Name in which shares should be registered (if different):
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*By providing an e-mail address, the Investor hereby consents to electronic
delivery of the documents and notices required to be delivered pursuant to this
Agreement.
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ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF SHARES
1. Authorization and Sale of the Shares. Subject to these Terms and
Conditions, the Company has authorized the sale of up to 3,500,000 Shares. The
Company reserves the right to increase or decrease this number.
2. Agreement to Sell and Purchase the Shares; Subscription Date.
2.1 At the Closing (as defined in Section 3), the Company will
sell to the Investor, and the Investor will purchase from the Company, upon the
terms and conditions hereinafter set forth, the number of Shares set forth in
Paragraph 3 of the Stock Purchase Agreement to which these Terms and Conditions
are attached at the purchase price set forth thereon.
2.2 The Company may enter into the same form of Stock Purchase
Agreement, including these Terms and Conditions, with certain other investors
(the "Other Investors") and expects to complete sales of Shares to them. (The
Investor and the Other Investors are hereinafter sometimes collectively referred
to as the "Investors," and the Stock Purchase Agreement to which these Terms and
Conditions are attached and the Stock Purchase Agreements (including attached
Terms and Conditions) executed by the Other Investors are hereinafter sometimes
collectively referred to as the "Agreements.") The Company may accept executed
Agreements from Investors for the purchase of Shares commencing upon the date on
which the Company provides the Investors with the proposed purchase price per
Share and concluding upon the date (the "Subscription Date") on which the
Company has (i) executed Agreements with Investors for the purchase of at least
2,000,000 Shares, and (ii) notified Xxxxxxxxx Xxxxxxxx, Inc., in its capacity as
placement agent for this transaction, in writing that it is no longer accepting
additional Agreements from Investors for the purchase of Shares. The Company may
not enter into any Agreements after the Subscription Date.
3. Delivery of the Shares at Closing. The completion of the purchase
and sale of the Shares (the "Closing") shall occur on July __, 2001 (the
"Closing Date"), at the offices of the Company's counsel or at such other place
as may be agreed upon by the Company and the Placement Agent. At the Closing,
the Company shall deliver to the Investor, or a representative of the Investor,
one or more stock certificates representing the number of Shares set forth in
Paragraph 3 of the Stock Purchase Agreement, each such certificate to be
registered in the name of the Investor or, if so indicated on the signature page
of the Stock Purchase Agreement, in the name of a nominee designated by the
Investor.
The Company's obligation to issue the Shares to the Investor shall be
subject to the following conditions, any one or more of which may be waived by
the Company: (a) prior receipt by the Company of a certified or official bank
check or wire transfer of funds in the full amount of the purchase price for the
Shares being purchased hereunder as set forth in Paragraph 3 of the Stock
Purchase Agreement; (b) completion of the purchases and sales under the
Agreements with the Other Investors; and (c) the accuracy of the representations
and warranties made by the Investors and the fulfillment of those undertakings
of the Investors to be fulfilled prior to the Closing.
The Investor's obligation to purchase the Shares shall be subject to
the following conditions, any one or more of which may be waived by the
Investor: (a) Investors shall have executed Agreements for the purchase of at
least 2,000,000 Shares, (b) the representations and warranties of the Company
set forth herein shall be true and correct as of the Closing Date in all
material respects and (c) the Investor shall have received such documents as
such Investor shall reasonably have requested, including, a standard opinion of
counsel to the Company as to the matters set forth in Section 4.2 and as to
exemption from the registration requirements of the Securities Act of 1933, as
amended (the "Securities Act"), of the sale of the Shares.
4. Representations, Warranties and Covenants of the Company. The
Company hereby represents and warrants to, and covenants with, the Investor, as
follows:
4.1 Organization. The Company is duly organized and validly
existing in good standing under the laws of the jurisdiction of its
organization. Each of the Company and its Subsidiaries (as defined in Rule 405
under the Securities Act) has full power and authority to own, operate and
occupy its properties and to conduct its business as presently conducted and as
described in the documents filed by the Company under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), since the end of its most recently
completed fiscal year through the date hereof, including, without limitation,
its report on Form 10-K for the year ended December 31, 2000 and its report on
Form 10-Q for the quarter ending March 31, 2001 (the "Exchange Act Documents")
and is registered or qualified to do business and in good standing in each
jurisdiction in which the nature of the
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business conducted by it or the location of the properties owned or leased by it
requires such qualification and where the failure to be so qualified would have
a material adverse effect upon the financial condition, earnings, business or
business prospects, properties or operations of the Company and its
Subsidiaries, considered as one enterprise (a "Material Adverse Effect"), and no
proceeding has been instituted in any such jurisdiction, revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and authority or
qualification.
4.2 Due Authorization and Valid Issuance. The Company has all
requisite power and authority to execute, deliver and perform its obligations
under the Agreements, and the Agreements have been duly authorized and validly
executed and delivered by the Company and constitute legal, valid and binding
agreements of the Company enforceable against the Company in accordance with
their terms, except as rights to indemnity and contribution may be limited by
state or federal securities laws or the public policy underlying such laws,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). The Shares being purchased by the Investor
hereunder will, upon issuance and payment therefor pursuant to the terms hereof,
be duly authorized, validly issued, fully-paid and nonassessable.
4.3 Non-Contravention. The execution and delivery of the
Agreements, the issuance and sale of the Shares under the Agreements, the
fulfillment of the terms of the Agreements and the consummation of the
transactions contemplated thereby will not (A) conflict with or constitute a
violation of, or default (with the passage of time or otherwise) under, (i) any
material bond, debenture, note or other evidence of indebtedness, lease,
contract, indenture, mortgage, deed of trust, loan agreement, joint venture or
other agreement or instrument to which the Company or any Subsidiary is a party
or by which it or any of its Subsidiaries or their respective properties are
bound, (ii) the charter, by-laws or other organizational documents of the
Company or any Subsidiary, or (iii) any law, administrative regulation,
ordinance or order of any court or governmental agency, arbitration panel or
authority applicable to the Company or any Subsidiary or their respective
properties, except in the case of clauses (i) and (iii) for any such conflicts,
violations or defaults which are not reasonably likely to have a Material
Adverse Effect or (B) result in the creation or imposition of any lien,
encumbrance, claim, security interest or restriction whatsoever upon any of the
material properties or assets of the Company or any Subsidiary or an
acceleration of indebtedness pursuant to any obligation, agreement or condition
contained in any material bond, debenture, note or any other evidence of
indebtedness or any material indenture, mortgage, deed of trust or any other
agreement or instrument to which the Company or any Subsidiary is a party or by
which any of them is bound or to which any of the material property or assets of
the Company or any Subsidiary is subject except in cases not reasonably likely
to have a Material Adverse Effect. No consent, approval, authorization or other
order of, or registration, qualification or filing with, any regulatory body,
administrative agency, or other governmental body in the United States or any
other person is required for the execution and delivery of the Agreements and
the valid issuance and sale of the Shares to be sold pursuant to the Agreements,
other than such as have been made or obtained, and except for any post-closing
securities filings or notifications required to be made under federal or state
securities laws.
4.4 Capitalization. The capitalization of the Company as of March
31, 2001 is as set forth in the most recent applicable Exchange Act Documents,
increased as set forth in the next sentence. The Company has not issued any
capital stock since that date other than pursuant to (i) employee benefit plans
disclosed in the Exchange Act Documents, or (ii) outstanding warrants, options
or other securities disclosed in the Exchange Act Documents. The Shares to be
sold pursuant to the Agreements have been duly authorized, and when issued and
paid for in accordance with the terms of the Agreements will be duly and validly
issued, fully paid and nonassessable. The outstanding shares of capital stock of
the Company have been duly and validly issued and are fully paid and
nonassessable, have been issued in compliance with all federal and state
securities laws, and were not issued in violation of any preemptive rights or
similar rights to subscribe for or purchase securities. Except as set forth in
or contemplated by the Exchange Act Documents, there are no outstanding rights
(including, without limitation, preemptive rights), warrants or options to
acquire, or instruments convertible into or exchangeable for, any unissued
shares of capital stock or other equity interest in the Company or any
Subsidiary, or any contract, commitment, agreement, understanding or arrangement
of any kind to which the Company is a party or of which the Company has
knowledge and relating to the issuance or sale of any capital stock of the
Company or any Subsidiary, any such convertible or exchangeable securities or
any such rights, warrants or options. Without limiting the foregoing, except for
the registration rights contemplated in this Agreement, no preemptive right,
co-sale right, right of first refusal, registration right, or other similar
right exists with respect to the Shares or the issuance and sale thereof. No
further approval or authorization of any stockholder, the Board of Directors of
the Company or others is required for the issuance and sale of the Shares. The
Company owns the entire equity interest in each of its Subsidiaries, free and
clear of any pledge, lien, security interest, encumbrance, claim or equitable
interest, other than as described in the Exchange Act Documents. Except as
disclosed in the Exchange Act Documents, there are no stockholders agreements,
voting agreements or other similar agreements with respect to
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the Common Stock to which the Company is a party or, to the knowledge of the
Company, between or among any of the Company's stockholders.
4.5 Legal Proceedings. There is no material legal or governmental
proceeding pending or, to the knowledge of the Company, threatened to which the
Company or any Subsidiary is or may be a party or of which the business or
property of the Company or any Subsidiary is subject that is not disclosed in
the Exchange Act Documents.
4.6 No Violations. Neither the Company nor any Subsidiary is in
violation of its charter, bylaws, or other organizational document, or in
violation of any law, administrative regulation, ordinance or order of any court
or governmental agency, arbitration panel or authority applicable to the Company
or any Subsidiary, which violation, individually or in the aggregate, would be
reasonably likely to have a Material Adverse Effect, or is in default (and there
exists no condition which, with the passage of time or otherwise, would
constitute a default) in any material respect in the performance of any bond,
debenture, note or any other evidence of indebtedness in any indenture,
mortgage, deed of trust or any other material agreement or instrument to which
the Company or any Subsidiary is a party or by which the Company or any
Subsidiary is bound or by which the properties of the Company or any Subsidiary
are bound, which would be reasonably likely to have a Material Adverse Effect.
4.7 Governmental Permits, Etc. With the exception of the matters
which are dealt with separately in Sections 4.1, 4.11, 4.12, and 4.13, each of
the Company and its Subsidiaries has all necessary franchises, licenses,
certificates and other authorizations from any foreign, federal, state or local
government or governmental agency, department, or body that are currently
necessary for the operation of the business of the Company and its Subsidiaries
as currently conducted and as described in the Exchange Act Documents except
where the failure to currently possess such documents or authorizations could
not reasonably be expected to have a Material Adverse Effect.
4.8 Intellectual Property. Except as specifically disclosed in the
Exchange Act Documents (i) each of the Company and its Subsidiaries owns or
possesses sufficient rights to use all material patents, patent rights,
trademarks, copyrights, licenses, inventions, trade secrets, trade names and
know-how (collectively, "Intellectual Property") described or referred to in the
Exchange Act Documents as owned or possessed by it or that are necessary for the
conduct of its business as now conducted or as proposed to be conducted as
described in the Exchange Act Documents except where the failure to currently
own or possess would not have a Material Adverse Effect, (ii) neither the
Company nor any of its Subsidiaries is infringing, or has received any notice
of, or has any knowledge of, any asserted infringement by the Company or any of
its Subsidiaries of, any rights of a third party with respect to any
Intellectual Property that, individually or in the aggregate, would have a
Material Adverse Effect and (iii) neither the Company nor any of its
Subsidiaries has received any notice of, or has any knowledge of, infringement
by a third party with respect to any Intellectual Property rights of the Company
or of any Subsidiary that, individually or in the aggregate, would have a
Material Adverse Effect.
4.9 Financial Statements; Accountants. The consolidated financial
statements of the Company and the related notes contained in the Exchange Act
Documents present fairly, in accordance with generally accepted accounting
principles, the financial position of the Company and its Subsidiaries as of the
dates indicated, and the results of its operations and cash flows for the
periods therein specified and are consistent with the books and records of the
Company and its Subsidiaries except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments
which are not expected to be material in amount. Such financial statements
(including the related notes) have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods therein specified, except as may be included in the notes to such
financial statements, or in the case of unaudited statements, as may be
permitted by the SEC on Form 10-Q under the Exchange Act and except as disclosed
in the Exchange Act Documents. The other financial information contained in the
Exchange Act Documents has been prepared on a basis consistent with the
financial statements of the Company. To the Company's knowledge, Xxxxxx
Xxxxxxxx, LLP, who the Company expects will consent to the inclusion in the
Registration Statement referred to in Section 7.1 hereof of its opinion with
respect to the financial statements to be incorporated by reference from the
Company's Annual Report on Form 10-K for the year ended December 31, 2000 into
the Registration Statement (as defined below) and the prospectus which forms a
part thereof, are independent accountants as required by the Securities Act and
the rules and regulations promulgated thereunder.
4.10 No Material Adverse Change. Except as disclosed in the
Exchange Act Documents, since March 31, 2001, there has not been (i) any
material adverse change in the financial condition or earnings of the Company
and its Subsidiaries considered as one enterprise, (ii) any material adverse
event affecting the Company or its Subsidiaries, (iii) any obligation, direct or
contingent, that is material to the Company and its Subsidiaries considered as
one enterprise, incurred by the Company, except obligations incurred in the
ordinary course of business, (iv) any dividend or distribution of any kind
declared, paid or made on the
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capital stock of the Company or any of its Subsidiaries, or (v) any loss or
damage (whether or not insured) to the physical property of the Company or any
of its Subsidiaries which has been sustained which has had a Material Adverse
Effect.
4.11 NASDAQ Compliance. The Company's Common Stock is registered
pursuant to Section 12(g) of the Exchange Act and is listed on The Nasdaq
National Market of The Nasdaq Stock Market, Inc. (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
de-listing the Common Stock from the Nasdaq National Market, nor has the Company
received any notification that the Securities and Exchange Commission (the
"SEC") or the National Association of Securities Dealers, Inc. ("NASD") is
contemplating terminating such registration or listing.
4.12 Reporting Status. The Company has filed in a timely manner
all documents that the Company was required to file under the Exchange Act
during the period from August 9, 2000, the effective date of the Company's
initial public offering to the date of this Agreement. The following documents
complied in all material respects with the SEC's requirements as of their
respective filing dates, and the information contained therein as of the date
thereof did not contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein in light of the circumstances under which they were made not
misleading:
(a) the proxy statement pursuant to Section 14(a) of the
Exchange Act, filed April 30, 2001;
(b) the annual report on Form 10-K for the year ended
December 31, 2000, filed on April 2, 2001;
(c) the quarterly report on Form 10-Q for the quarter
ended March 31, 2001, filed on May 11, 2001;
(d) the quarterly report on Form 10-Q for the quarter
ended September 30, 2000 filed on November 14, 2000;
(e) the quarterly report on Form 10-Q for the quarter
ended June 30, 2000, filed on September 21, 2000;
(f) the registration on Form 8-A under the Exchange Act,
filed on August 4, 2000;
(g) the report on Form 8-K, filed on October 6, 2000;
(h) the report on Form 8-K/A, filed on November 22,
2000;
(i) All other documents, if any, filed by the Company
with the SEC since August 9, 2000 pursuant to the
reporting requirements of the Exchange Act.
4.13 Listing. The Company shall comply with all requirements of
the National Association of Securities Dealers, Inc. with respect to the
issuance of the Shares and the listing thereof on the Nasdaq National Market.
4.14 No Manipulation of Stock. 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 Shares.
4.15 Company not an "Investment Company". The Company has been
advised of the rules and requirements under the Investment Company Act of 1940,
as amended (the "Investment Company Act"). The Company is not, and immediately
after receipt of payment for the Shares will not be, an "investment company" or
an entity "controlled" by an "investment company" within the meaning of the
Investment Company Act and shall conduct its business in a manner so that it
will not become subject to the Investment Company Act.
4.16 Foreign Corrupt Practices. Neither the Company, nor to the
knowledge of the Company, any agent or other person acting on behalf of the
Company, has (i) directly or indirectly, used any corrupt funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to
foreign or domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any foreign or
domestic political parties or campaigns from corporate
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funds, (iii) failed to disclose fully any contribution made by the Company (or
made by any person acting on its behalf of which the Company is aware) which is
in violation of law, or (iv) violated in any material respect any provision of
the Foreign Corrupt Practices Act of 1977, as amended.
4.17 Contracts. The contracts described in the Exchange Act
Documents that are material to the Company are in full force and effect on the
date hereof, and neither the Company nor, to the Company's knowledge, any other
party to such contracts is in breach of or default under any of such contracts
which would have a Material Adverse Effect.
4.18 Taxes. The Company has filed all necessary federal, state and
foreign income and franchise tax returns and has paid or accrued all taxes shown
as due thereon, and the Company has no knowledge of a tax deficiency which has
been or might be asserted or threatened against it which would have a Material
Adverse Effect.
4.19 Transfer Taxes. On the Closing Date, all stock transfer or
other taxes (other than income taxes) which are required to be paid in
connection with the sale and transfer of the Shares to be sold to the Investor
hereunder will be, or will have been, fully paid or provided for by the Company
and all laws imposing such taxes will be or will have been fully complied with.
4.20 Private Offering. Assuming (i) the correctness of the
representations and warranties of the Investors set forth in Section 5 hereof,
(ii) the correctness of the information provided in the Investor Questionnaire
submitted by each of the Investors and (iii) that Placement Agent's activities
are consistent with the activities permissible under Rule 506 of Regulation D of
the Securities Act, the offer and sale of Shares hereunder is exempt from
registration under the Securities Act. The Company has not distributed and will
not distribute prior to the Closing Date any offering material in connection
with this Offering and sale of the Shares other than the documents of which this
Agreement is a part or the Exchange Act Documents. The Company has not in the
past nor will it hereafter take any action independent of the placement agent to
sell, offer for sale or solicit offers to buy any securities of the Company
which would bring the offer, issuance or sale of the Shares as contemplated by
this Agreement, within the provisions of Section 5 of the Securities Act, unless
such offer or sale was or shall be within the exemptions under Section 4 of the
Securities Act.
5. Representations, Warranties and Covenants of the Investor.
5.1 The Investor represents and warrants to, and covenants with,
the Company that: (i) the Investor is an "accredited investor" as defined in
Regulation D under the Securities Act and the Investor is also knowledgeable,
sophisticated and experienced in making, and is qualified to make decisions with
respect to investments in shares presenting an investment decision like that
involved in the purchase of the Shares, including investments in securities
issued by the Company and investments in comparable companies, and has
requested, received, reviewed and considered all information it deemed relevant
in making an informed decision to purchase the Shares; (ii) the Investor is
acquiring the number of Shares set forth in Section 3 of the Stock Purchase
Agreement in the ordinary course of its business and for its own account for
investment only and with no present intention of distributing any of such Shares
or any arrangement or understanding with any other persons regarding the
distribution of such Shares; (iii) the Investor will not, directly or
indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit
any offers to buy, purchase or otherwise acquire or take a pledge of) any of the
Shares except in compliance with the Securities Act, applicable state securities
laws and the respective rules and regulations promulgated thereunder; (iv) the
Investor has answered all questions on the Investor Questionnaire for use in
preparation of the Registration Statement and the answers thereto are true,
correct and complete as of the date hereof and will be true, correct and
complete as of the Closing Date; (v) the Investor will notify the Company
immediately of any change in any of such information until such time as the
Investor has sold all of its Shares or until the Company is no longer required
to keep the Registration Statement effective; and (vi) the Investor has, in
connection with its decision to purchase the number of Shares set forth in
Paragraph 3 of the Stock Purchase Agreement, relied only upon the Exchange Act
Documents and the representations and warranties of the Company contained
herein. The Investor understands that neither this Offering nor the acquisition
of the Shares have been registered under the Securities Act or registered or
qualified under any state securities law in reliance on specific exemptions
therefrom, which exemptions may depend upon, among other things, the bona fide
nature of the Investor's investment intent as expressed herein and the
information provided in the Investor's Investor Questionnaire. Investor has
completed or caused to be completed and delivered to the Company the Investor
Questionnaire, which questionnaire is true, correct and complete in all material
respects.
5.2 The Investor acknowledges, represents and agrees that no
action has been or will be taken in any jurisdiction outside the United States
by the Company that would permit an offering of the Shares, or possession or
distribution of offering materials in connection with the issue of the Shares,
in any jurisdiction outside the United States where legal action by the
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Company for that purpose is required. Each Investor outside the United States
will comply with all applicable laws and regulations in each foreign
jurisdiction in which it purchases, offers, sells or delivers Shares or has in
its possession or distributes any offering material, in all cases at its own
expense.
5.3 The Investor hereby covenants with the Company not to make any
sale of the Shares without complying with the provisions of this Agreement and
without causing the prospectus delivery requirement under the Securities Act to
be satisfied, and the Investor acknowledges that the certificates evidencing the
Shares will be imprinted with a legend that prohibits their transfer except in
accordance therewith. The Investor acknowledges that there may occasionally be
times when the Company determines that it must suspend the use of the prospectus
forming a part of the Registration Statement, as set forth in Section 7.2(c).
5.4 The Investor further represents and warrants to, and covenants
with, the Company that (i) the Investor has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement, and (ii) this Agreement
constitutes a valid and binding obligation of the Investor enforceable against
the Investor in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the indemnification agreements of the Investors
herein may be legally unenforceable.
5.5 Investor will not use any of the restricted Shares acquired
pursuant to this Agreement to cover any short position in the Common Stock of
the Company if doing so would be in violation of applicable securities laws.
5.6 The Investor understands that nothing in the Exchange Act
Documents, this Agreement or any other materials presented to the Investor in
connection with the purchase and sale of the Shares constitutes legal, tax or
investment advice. The Investor has consulted such legal, tax and investment
advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Shares.
6. Survival of Representations, Warranties and Agreements.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Shares being purchased and the payment therefor.
7. Registration of the Shares; Compliance with the Securities Act.
7.1 Registration Procedures and Other Matters. The Company
shall:
(a) subject to receipt of necessary information from the
Investors after prompt request from the Company to the Investors to provide such
information, prepare and file with the SEC, within 10 days after the Closing
Date, (or, if the tenth day after the Closing Date is not a business day, then
the first business day thereafter) a registration statement on Form S-3 (the
"S-3 Registration Statement") to enable the resale of the Shares by the
Investors from time to time through the automated quotation system of the Nasdaq
National Market or in privately-negotiated transactions;
(b) use its best efforts, subject to receipt of
necessary information from the Investors after prompt request from the Company
to the Investors to provide such information, to cause the S-3 Registration
Statement to become effective within 30 days after the S-3 Registration
Statement is filed by the Company (or, if the thirtieth day is not a business
day, the first business day thereafter), such efforts to include, without
limiting the generality of the foregoing, preparing and filing with the SEC in
such 30-day period any financial statements that are required to be filed prior
to the effectiveness of such S-3 Registration Statement;
(c) use its best efforts to prepare and file with the
SEC such amendments and supplements to the Registration Statement and the
prospectus used in connection therewith as may be necessary to keep the
Registration Statement current, effective and free from any material
misstatement or omission to state a material fact for a period not exceeding,
with respect to each Investor's Shares purchased hereunder, the earlier of (i)
the second anniversary of the Closing Date, (ii) the date on which the Investor
may sell all Shares then held by the Investor without restriction by the volume
limitations of Rule 144(e) of the
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Securities Act, or (iii) such time as all Shares purchased by such Investor in
this Offering have been sold pursuant to a registration statement;
(d) furnish to the Investor with respect to the Shares
registered under the Registration Statement such number of copies of the
Registration Statement, prospectuses and preliminary prospectuses in conformity
with the requirements of the Securities Act and such other documents as the
Investor may reasonably request, in order to facilitate the public sale or other
disposition of all or any of the Shares by the Investor; provided, however, that
the obligation of the Company to deliver copies of prospectuses or preliminary
prospectuses to the Investor shall be subject to the receipt by the Company of
reasonable assurances from the Investor that the Investor will comply with the
applicable provisions of the Securities Act and of such other securities or blue
sky laws as may be applicable in connection with any use of such prospectuses or
preliminary prospectuses;
(e) file documents required of the Company for normal
blue sky clearance in states specified in writing by the Investor and use its
best efforts to maintain such blue sky qualifications during the period the
Company is required to maintain the effectiveness of the Registration Statement
pursuant to Section 7.1(d); provided, however, that the Company shall not be
required to qualify to do business or consent to service of process in any
jurisdiction in which it is not now so qualified or has not so consented;
(f) bear all expenses in connection with the procedures
in paragraph (a) through (e) of this Section 7.1 and the registration of the
Shares pursuant to the Registration Statement except with respect to any legal
or attorney fees incurred by any of the Investors in connection with the
Registration Statement and any amendments thereto; and
(g) advise the Investor, promptly after it shall receive
notice or obtain knowledge of the issuance of any stop order by the SEC delaying
or suspending the effectiveness of the Registration Statement or of the
initiation or threat of any proceeding for that purpose; and it will promptly
use its best efforts to prevent the issuance of any stop order or to obtain its
withdrawal at the earliest possible moment if such stop order should be issued.
The Investor acknowledges that the Company may include on the
Registration Statement; shares of common stock of the company for resale by
certain other stockholders of the Company, and that the Company may file a
subsequent registration statement for the resale of shares of common stock by
certain other stockholder of the Company. In no other event at any time before
the Registration Statement becomes effective with respect to the Shares shall
the Company publicly announce or file any other registration statement, other
than registrations on Form S-8, without the prior written consent of a majority
in interest of the Investors.
The Company understands that the Investor disclaims being an
underwriter, but the Investor being deemed an underwriter by the SEC shall not
relieve the Company of any obligations it has hereunder; provided, however that
if the Company receives notification from the SEC that the Investor is deemed an
underwriter, then the period by which the Company is obligated to exercise its
best efforts to submit an acceleration request to the SEC shall be extended to
the earlier of (i) the 90th day after such SEC notification, or (ii) 120 days
after the initial filing of the Registration Statement with the SEC.
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7.2 Transfer of Shares After Registration; Suspension.
(a) The Investor agrees that it will not effect any
disposition of the Shares or its right to purchase the Shares that would
constitute a sale within the meaning of the Securities Act except as
contemplated in the Registration Statement referred to in Section 7.1 and as
described below or as otherwise permitted by law, and that it will promptly
notify the Company of any changes in the information set forth in the
Registration Statement regarding the Investor or its plan of distribution.
(b) Except in the event that paragraph (c) below
applies, the Company shall (i) if deemed necessary by the Company, prepare and
file from time to time with the SEC a post-effective amendment to the
Registration Statement or a supplement to the related prospectus or a supplement
or amendment to any document incorporated therein by reference or file any other
required document so that such Registration Statement will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
so that, as thereafter delivered to purchasers of the Shares being sold
thereunder, such prospectus will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading; (ii) provide the Investor copies of any documents
filed pursuant to Section 7.2(b)(i); and (iii) inform each Investor that the
Company has complied with its obligations in Section 7.2(b)(i) (or that, if the
Company has filed a post-effective amendment to the Registration Statement which
has not yet been declared effective, the Company will notify the Investor to
that effect, will use its best efforts to secure the effectiveness of such
post-effective amendment as promptly as possible and will promptly notify the
Investor when the amendment has become effective).
(c) Subject to paragraph (d) below, in the event (i) of
any request by the SEC or any other federal or state governmental authority
during the period of effectiveness of the Registration Statement for amendments
or supplements to a Registration Statement or related prospectus or for
additional information; (ii) of the issuance by the SEC or any other federal or
state governmental authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose;
(iii) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Shares for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; or (iv) of any event or circumstance which, upon
the advice of its counsel, necessitates the making of any changes in the
Registration Statement or prospectus, or any document incorporated or deemed to
be incorporated therein by reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
prospectus, it will not contain any untrue statement of a material fact or any
omission 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; then the Company shall deliver a certificate in writing to
the Investor (the "Suspension Notice") to the effect of the foregoing and, upon
receipt of such Suspension Notice, the Investor will refrain from selling any
Shares pursuant to the Registration Statement (a "Suspension") until the
Investor's receipt of copies of a supplemented or amended prospectus prepared
and filed by the Company, or until it is advised in writing by the Company that
the current prospectus may be used, and has received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in any such prospectus. In the event of any Suspension, the Company will use its
best efforts to cause the use of the prospectus so suspended to be resumed as
soon as reasonably practicable within 20 business days after the delivery of a
Suspension Notice to the Investor. In addition to and without limiting any other
remedies (including, without limitation, at law or at equity) available to the
Investor, the Investor shall be entitled to specific performance in the event
that the Company fails to comply with the provisions of this Section 7.2(c).
(d) Notwithstanding the foregoing paragraphs of this
Section 7.2, the Investor shall not be prohibited from selling Shares under the
Registration Statement as a result of Suspensions on more than two occasions of
not more than 30 days each in any twelve-month period, unless, in the good faith
judgment of the Company's Board of Directors, upon the written opinion of
counsel, the sale of Shares under the Registration Statement in reliance on this
paragraph 7.2(d) would be reasonably likely to cause a violation of the
Securities Act or the Exchange Act and result in liability to the Company.
(e) Provided that a Suspension is not then in effect,
the Investor may sell Shares under the Registration Statement, provided that it
arranges for delivery of a current prospectus to the transferee of such Shares.
Upon receipt of a request therefor, the Company has agreed to provide an
adequate number of current prospectuses to the Investor and to supply copies to
any other parties requiring such prospectuses.
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(f) In the event of a sale of Shares by the Investor
pursuant to the Registration Statement, the Investor must also deliver to the
Company's transfer agent, with a copy to the Company, a Certificate of
Subsequent Sale substantially in the form attached hereto as Exhibit A, and its
stock certificate, so that the Shares may be properly transferred.
7.3 Indemnification. For the purpose of this Section 7.3:
(i) the term "Selling Stockholder" shall include the Investor
and any affiliate of such Investor;
(ii) the term "Registration Statement" shall include the
prospectus in the form first filed with the SEC pursuant to Rule 424(b) of the
Securities Act or filed as part of the Registration Statement at the time of
effectiveness if no Rule 424(b) filing is required, and any exhibit, supplement
or amendment included in or relating to the Registration Statement referred to
in Section 7.1; and
(iii) the term "untrue statement" shall include any untrue
statement or alleged untrue statement, or any omission or alleged omission to
state in the Registration Statement a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(a) The Company agrees to indemnify and hold harmless
each Selling Stockholder from and against any losses, claims, damages or
liabilities to which such Selling Stockholder may become subject (under the
Securities Act or otherwise) insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon (i) any breach of the representations or warranties of the Company
contained herein or failure to comply with the covenants and agreements of the
Company contained herein, (ii) any untrue statement of a material fact contained
in the Registration Statement as amended at the time of effectiveness or any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, or (iii) any failure by the Company to
fulfill any undertaking included in the Registration Statement at the time of
effectiveness, and the Company will reimburse such Selling Stockholder for any
reasonable and documented legal expenses and any other actual, accountable
out-of -pocket expenses reasonably incurred in investigating, defending or
preparing to defend any such action, proceeding or claim, or preparing to defend
any such action, proceeding or claim, provided, however, that the Company shall
not be liable in any such case to the extent that such loss, claim, damage or
liability arises out of, or is based upon, an untrue statement made in such
Registration Statement or any omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading in reliance
upon and in conformity with written information furnished to the Company by or
on behalf of such Selling Stockholder specifically for use in preparation of the
Registration Statement or the failure of such Selling Stockholder to comply with
its covenants and agreements contained in Section 7.2 hereof respecting the sale
of the Shares or any statement or omission in any prospectus that is corrected
in any subsequent prospectus that was delivered to the Selling Stockholder prior
to the pertinent sale or sales by the Selling Stockholder. The Company shall
reimburse each Selling Stockholder for the amounts provided for herein within a
reasonable period of time after demand thereof.
(b) The Investor agrees to indemnify and hold harmless
the Company (and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act, each officer of the Company who
signs the Registration Statement and each director of the Company) from and
against any losses, claims, damages or liabilities to which the Company (or any
such officer, director or controlling person) may become subject (under the
Securities Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, (i) any failure to comply with the covenants and agreements
contained in Section 7.2 hereof respecting sale of the Shares, or (ii) any
untrue statement of a material fact contained in the Registration Statement or
any omission of a material fact required to be stated therein or necessary to
make the statements therein not misleading if such untrue statement or omission
was made in reliance upon and in conformity with written information furnished
by or on behalf of the Investor specifically for use in preparation of the
Registration Statement, and the Investor will reimburse the Company (or such
officer, director or controlling person), as the case may be, for any legal or
other expenses reasonably incurred in investigating, defending or preparing to
defend any such action, proceeding or claim.
(c) Promptly after receipt by any indemnified person of
a notice of a claim or the beginning of any action in respect of which indemnity
is to be sought against an indemnifying person pursuant to this Section 7.3,
such indemnified person shall notify the indemnifying person in writing of such
claim or of the commencement of such action, but the omission to so notify the
indemnifying person will not relieve it from any liability which it may have to
any indemnified person under this Section 7.3 (except to the extent that such
omission materially and adversely affects the indemnifying person's ability to
defend such action) or from any liability otherwise than under this Section 7.3.
Subject to the provisions hereinafter stated, in case any
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such action shall be brought against an indemnified person, the indemnifying
person shall be entitled to participate therein, and, to the extent that it
shall elect by written notice delivered to the indemnified person promptly after
receiving the aforesaid notice from such indemnified person, shall be entitled
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified person. After notice from the indemnifying person to such
indemnified person of its election to assume the defense thereof, such
indemnifying person shall not be liable to such indemnified person for any legal
expenses subsequently incurred by such indemnified person in connection with the
defense thereof, provided, however, that if there exists or shall exist a
conflict of interest that would make it inappropriate, in the opinion of counsel
to the indemnified person, for the same counsel to represent both the
indemnified person and such indemnifying person or any affiliate or associate
thereof, the indemnified person shall be entitled to retain its own counsel at
the expense of such indemnifying person; provided, however, that no indemnifying
person shall be responsible for the fees and expenses of more than one separate
counsel (together with appropriate local counsel) for all indemnified parties.
In no event shall any indemnifying person be liable in respect of any amounts
paid in settlement of any action unless the indemnifying person shall have
approved the terms of such settlement; provided that such consent shall not be
unreasonably withheld. No indemnifying person shall, without the prior written
consent of the indemnified person, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified person is or could
have been a party and indemnification could have been sought hereunder by such
indemnified person, unless such settlement includes an unconditional release of
such indemnified person from all liability on claims that are the subject matter
of such proceeding.
(d) If the indemnification provided for in this Section
7.3 is unavailable to or insufficient to hold harmless an indemnified person
under subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying person shall contribute to the amount paid or payable by
such indemnified person as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Investor,
as well as any other Selling Shareholders under such registration statement on
the other in connection with the statements or omissions or other matters which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
fault shall be determined by reference to, among other things, in the case of an
untrue statement, whether the untrue statement relates to information supplied
by the Company on the one hand or an Investor or other Selling Shareholder on
the other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement. The Company and the
Investor agree that it would not be just and equitable if contribution pursuant
to this subsection (d) were determined by pro rata allocation (even if the
Investor and other Selling Shareholders were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified person as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified person in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), the Investor shall not be required to contribute any amount in
excess of the amount by which the net amount received by the Investor from the
sale of the Shares to which such loss relates exceeds the amount of any damages
which such Investor has otherwise been required to pay by reason of such untrue
statement. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Investor's obligations in this subsection to contribute shall be in proportion
to its Investor sale of Shares to which such loss relates and shall not be joint
with any other Selling Shareholders.
(e) The Investor hereby acknowledges that it is a
sophisticated business person who was represented by counsel during the
negotiations regarding the provisions hereof including, without limitation, the
provisions of this Section 7.3, and is fully informed regarding said provisions.
The Investor further acknowledges that the provisions of this Section 7.3 fairly
allocate the risks involved in the Offering. The Investor and the Company are
advised that federal or state public policy as interpreted by the courts in
certain jurisdictions may be contrary to certain of the provisions of this
Section 7.3, and the Investor and the Company hereto hereby expressly waive and
relinquish any right or ability to assert such public policy as a defense to a
claim under this Section 7.3 and further agree not to attempt to assert any such
defense.
7.4 Termination of Conditions and Obligations. The conditions
precedent imposed by Section 5 or this Section 7 upon the transferability of the
Shares shall cease and terminate as to any particular number of the Shares when
such Shares shall have been effectively registered under the Securities Act and
sold or otherwise disposed of in accordance with the intended method of
disposition set forth in the Registration Statement covering such Shares or at
such time as an opinion of counsel reasonably satisfactory to the Company shall
have been rendered to the effect that such conditions are not necessary in order
to comply with the Securities Act.
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7.5 Information Available. So long as the Registration Statement
is effective covering the resale of Shares owned by the Investor, the Company
will furnish to the Investor:
(a) as soon as practicable after it is available, one copy of
(i) its Annual Report to Stockholders (which Annual Report shall contain
financial statements audited in accordance with generally accepted accounting
principles by a national firm of certified public accountants), (ii) its Annual
Report on Form 10-K and (iii) its Quarterly Reports on Form 10-Q (the foregoing,
in each case, excluding exhibits);
(b) upon the request of the Investor, all exhibits excluded by
the parenthetical to subparagraph (a) of this Section 7.5 as filed with the SEC
and all other information that is made available to shareholders; and
(c) upon the reasonable request of the Investor, an adequate
number of copies of the prospectuses to supply to any other party requiring such
prospectuses; and upon the reasonable request of the Investor, the President or
the Chief Financial Officer of the Company (or an appropriate designee
identified by the Company) will meet with the Investor or a representative
thereof at the Company's headquarters to discuss all information relevant for
disclosure in the Registration Statement covering the Shares and will otherwise
cooperate with any Investor conducting an investigation for the purpose of
reducing or eliminating such Investor's exposure to liability under the
Securities Act, including the reasonable production of information at the
Company's headquarters; provided, that the Company shall not be required to
disclose any confidential information to or meet at its headquarters with any
Investor until and unless the Investor shall have entered into a confidentiality
agreement in form and substance reasonably satisfactory to the Company with the
Company with respect thereto.
(d) if agreed to by the Investor on the signature page to this
Agreement, the documents required to be delivered by the Company pursuant to
this Agreement, except for the prospectus or preliminary prospectus required to
be delivered pursuant to Section 7.1(d) herein, shall be delivered to the
Investor in electronic form to the e-mail address provided by the Investor on
the signature page of the Stock Purchase Agreement.
8. Notices. All notices, requests, consents and other communications
hereunder shall be in writing, shall be mailed (A) if within the United States
by first-class registered or certified airmail, or nationally recognized
overnight express courier, postage prepaid, by facsimile or e-mail (if agreed to
by the Investor), or (B) if delivered from outside the United States, by
international express courier, facsimile or e-mail (if agreed to by the
Investor), and shall be deemed given (i) if delivered by first-class registered
or certified mail, three business days after so mailed, (ii) if delivered by
nationally recognized overnight carrier, one business day after so mailed, (iii)
if delivered by International Federal Express, two business days after so
mailed, (iv) if delivered by facsimile or e-mail, upon electronic confirmation
of receipt and shall be delivered as addressed as follows:
(a) if to the Company, to:
Esperion Therapeutics, Inc.
0000 X. Xxxxx Xxxxxx
000 XXX Xxxxx
Xxx Xxxxx, XX 00000
Attn: President
(b) with a copy to:
Xxxxxx, Xxxxx & Xxxxxxx, LLP
0000 X Xxxxxx X.X.
Xxxxxxxxxx X.X. 00000
Attention: Xxxxx Xxxxxx
(c) if to the Investor, at its mail or e-mail address on
the signature page hereto, or at such other address
or addresses as may have been furnished to the
Company in writing.
9. Changes. This Agreement may not be modified or amended except
pursuant to an instrument in writing signed by the Company and the Investor.
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10. Headings. The headings of the various sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed to
be part of this Agreement and do not affect its interpretation.
11. Severability. In case any provision contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
12. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of Delaware, without giving
effect to the principles of conflicts of law.
13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.
14. Rule 144. The Company covenants that it will timely file the
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder (or, if the Company
is not required to file such reports, it will, upon the request of any Investor
holding Shares purchased hereunder made after the first anniversary of the
Closing Date, make publicly available such information as necessary to permit
sales pursuant to Rule 144 under the Securities Act), and it will take such
further action as any such Investor may reasonably request, all to the extent
required from time to time to enable such Investor to sell Shares purchased
hereunder without registration under the Securities Act within the limitation of
the exemptions provided by (a) Rule 144 under the Securities Act, as such Rule
may be amended from time to time, or (b) any similar rule or regulation
hereafter adopted by the SEC. Upon the request of the Investor, the Company will
deliver to such holder a written statement as to whether it has complied with
such information and requirements.
15. Confidential Information. The Investor represents to the Company
that, at all times during the Company's offering of the Shares, the Investor has
maintained in confidence all non-public information regarding the Company
received by the Investor from the Company or its agents, including information
about the Offering of the Shares and covenants that it will continue to maintain
in confidence such information until such information (a) becomes generally
publicly available other than through a violation of this provision by the
Investor or its agents or (b) is required to be disclosed in legal proceedings
(such as by deposition, interrogatory, request for documents, subpoena, civil
investigation demand, filing with any governmental authority or similar
process), provided, however, that before making any use or disclosure in
reliance on this subparagraph (b) the Investor shall give the Company at least
fifteen (15) days prior written notice (or such shorter period as required by
law) specifying the circumstances giving rise thereto and will furnish only that
portion of the non-public information which is legally required and will
exercise its best efforts to obtain reliable assurance that confidential
treatment will be accorded any non-public information so furnished.
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