Exhibit 10.1
SERIES B CONVERTIBLE PREFERRED STOCK
AND WARRANT PURCHASE AGREEMENT
THIS SERIES B CONVERTIBLE PREFERRED STOCK AND WARRANT PURCHASE
AGREEMENT (this "Agreement") is made as of March 29, 1999 by and among Integra
LifeSciences Corporation, a Delaware corporation ("Integra"), and the several
purchasers listed on Schedule 1 hereto (the "Purchasers").
WHEREAS, Integra has agreed to issue and sell to each of the
Purchasers, and each of the Purchasers has agreed to purchase from Integra, for
the aggregate purchase price set forth opposite such Purchaser's name on
Schedule 1 hereto, (i) the aggregate number of shares of Series B Convertible
Preferred Stock, par value $.01 per share, of Integra (the "Series B Preferred
Stock") set forth opposite such Purchaser's name on Schedule 1 hereto, and (ii)
the warrant (the "Warrant") to purchase, subject to the terms and conditions
thereof, the aggregate number of shares of Common Stock, par value $.01 per
share, of Integra (the "Common Stock") set forth opposite such Purchaser's name
on Schedule 1 hereto, at an exercise price of $3.82 per share, containing terms
and conditions set forth in the form of warrant attached hereto as Exhibit A.
NOW, THEREFORE, in consideration of the mutual terms and
conditions herein contained, and for good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto, intending to be
legally bound, hereby agree as follows:
DEFINITIONS
For all purposes of this Agreement, unless otherwise expressly
provided, (a) the terms defined in this Definitions section have the meanings
assigned to them herein and include the plural as well as the singular, (b) all
accounting terms not otherwise defined herein have the meanings assigned under
generally accepted accounting principles in the United States, (c) all
references in this Agreement to designated "Sections" and other subdivisions are
to the designated Sections and other subdivisions of the body of this Agreement,
(d) pronouns of either gender or neuter shall include, as appropriate, the other
pronoun forms, and (e) the words "herein", "hereof" and other words of similar
import refer to this Agreement as a whole and not to any particular Article,
Section or other subdivision.
As used in this Agreement, the following definitions shall
apply:
"Additional Preferred Stock" shall mean the convertible
preferred stock issued pursuant to Section 1.3 having substantially
identical terms as the Series B Preferred Stock.
"Action" means any action, complaint, petition, investigation,
suit or other proceeding, whether civil or criminal, in law or in
equity, or before any arbitrator or Governmental Entity.
"Affiliate" shall mean any Person who is an "affiliate" (as
defined in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act) of, and any Person controlling, controlled by, or under
common control with, any Purchaser. For the purposes of this Agreement,
"control" includes the ability to have investment discretion through
contractual means or by operation of law.
"Agreement" means this Agreement as the same may be amended,
supplemented or modified in accordance with the terms hereof.
"Audited Financial Statements" has the meaning set forth in
Section 7.2 of this Agreement.
"Board of Directors" means the Board of Directors of Integra.
"Business" means the business of Integra and shall be deemed
to include any of the following incidents of such business: income,
operations, condition (financial or other), assets, properties and
liabilities.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial banks in the State of New York are
authorized or required by law or executive order to close.
"By-laws" means the amended and restated by-laws of Integra,
as the same may have been amended and as in effect on the Closing Date.
"CEO Certificate" has the meaning set forth in Section 1.3 of
this Agreement.
"Certificate of Designation" means the Certificate of
Designation with respect to the Series B Preferred Stock adopted by the
Board of Directors and filed with the Secretary of State of the State
of Delaware on or before the Closing Date substantially in the form
attached hereto as Exhibit B.
"Certificate of Incorporation" means the Amended and Restated
Certificate of Incorporation of Integra, as the same has been amended
and as in effect on the Closing Date.
"Closing" has the meaning set forth in Section 1.4 of this
Agreement.
"Closing Date" means the date specified in Section 1.4 of this
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor statute thereto.
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"Commission" means the Securities and Exchange Commission or
any similar agency then having jurisdiction to enforce the Securities
Act.
"Common Stock" means the Common Stock, par value $.01 per
share, of Integra and any other capital stock of Integra into which
such stock is reclassified or reconstituted.
"Condition of Integra" means the assets, business, properties,
operations or financial condition of Integra and the Subsidiaries,
taken as a whole.
"Contract" means any agreement, arrangement, bond, commitment,
franchise, indemnity, indenture, instrument, lease, license or
understanding, whether or not in writing.
"Contractual Obligations" means as to any Person, any
provision of any security issued by such Person or of any agreement,
undertaking, contract, indenture, mortgage, deed of trust or other
instrument to which such Person is a party or by which it or any of its
property is bound.
"Conversion Price" has the meaning set forth in Section 1.3 of
this Agreement.
"Encumbrance" means any claim, charge, easement, encumbrance,
lease, covenant, security interest, lien, option, pledge, rights of
others, restriction (whether on voting, sale, transfer, disposition or
otherwise), whether imposed by agreement, understanding, law, equity or
otherwise, except for any restrictions on transfer generally arising
under any applicable United States federal or state securities law.
"Environmental Laws" means federal, state and local laws,
principles of common law, regulations and codes, as well as orders,
decrees, judgments or injunctions issued, promulgated, approved or
entered thereunder relating to pollution, protection of the environment
or public health and safety.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended (or any successor statute thereto).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended (or any successor statute thereto), and the rules and
regulations of the Commission promulgated thereunder.
"Financial Statements" has the meaning set forth in Section
2.10 of this Agreement.
"GAAP" means generally accepted United States accounting
principles in effect from time to time.
"Governmental Authority" means the government of any state,
city, locality or other political subdivision thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or
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other entity owned or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.
"Governmental Entity" means any government or any agency,
bureau, board, commission, court, department, official, political
subdivision, tribunal or other instrumentality of any government of or
within the United States, whether federal, state or local.
"Initial Term" has the meaning set forth in Section 1.3 of
this Agreement.
"Law" means any constitutional provision, statute or other
law, rule, regulation, or interpretation of any Governmental Entity and
any Order.
"Liabilities" has the meaning set forth in Section 2.20 of
this Agreement.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment, encumbrance, lien (statutory or other) or
preference, priority, right or other security interest or preferential
arrangement of any kind or nature whatsoever (excluding preferred stock
and equity related preferences) including, without limitation, those
created by, arising under or evidenced by any conditional sale or other
title retention agreement, the interest of a lessor under a Capital
Lease Obligation, or any financing lease having substantially the same
economic effect as any of the foregoing.
"Loss" means any action, cost, damage, disbursement, expense,
liability, loss, deficiency, diminution in value, obligation, penalty
or settlement of any kind or nature, whether foreseeable or
unforeseeable, including but not limited to, interest or other carrying
costs, penalties, legal, accounting and other professional fees and
expenses incurred in the investigation, collection, prosecution and
defense of claims and amounts paid in settlement, that may be imposed
on or otherwise incurred or suffered by the specified Person.
"NASDAQ" means the NASDAQ National Market of the National
Association of Securities Dealers, Inc. Automated Quotation System.
"NeuroCare Acquisition Agreement" means the Asset Purchase
Agreement dated the date hereof between the Company, Integra NeuroCare
LLC, a Delaware limited liability company and an indirect wholly-owned
subsidiary of the Company ("IN LLC"), Xxxxxxx NeuroCare LLC, a Delaware
limited liability company and a wholly-owned subsidiary of IN LLC,
Xxxxx-Xxxxxxx NeuroCare, L.P., a Delaware limited partnership ("HSN,
LP"), and Neuro Navigational, L.L.C., a Delaware limited liability
company and a wholly-owned subsidiary of HSN, LP.
"Order" mans any decree, injunction, judgement, order, ruling,
assessment or writ of any Governmental Entity.
"Person" means any individual, firm, corporation, partnership,
limited liability company, trust, incorporated or unincorporated
association, joint venture, joint stock company,
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Governmental Authority or other entity of any kind, and shall include
any successor (by merger or otherwise) of such entity.
"Purchased Shares" has the meaning set forth in Section 1.1 of
this Agreement.
"Purchasers" has the meaning ascribed to such term in the
recital to this Agreement.
"Put Right" has the meaning set forth in Section 1.3 of this
Agreement.
"Registration Rights Agreement" means the Registration Rights
Agreement substantially in the form attached hereto as Exhibit C.
"Requirements of Law" means as to any Person, any law, treaty,
rule, regulation, right, privilege, qualification, license or franchise
or determination of an arbitrator or a court or other Governmental
Authority or a stock exchange, in each case applicable or binding upon
such Person or any of its property or to which such Person or any of
its property is subject or pertaining to any or all of the transactions
contemplated or referred to herein.
"SEC" means the Securities and Exchange Commission or any
successor entity.
"SEC Documents" means all registration statements, proxy
statements, reports and other documents required to be filed by Integra
under the Securities Act or the Exchange Act, and all amendments and
supplements thereto, filed by Integra with the Commission since
December 31, 1997.
"Second Term" has the meaning set forth in Section 1.3 to this
Agreement.
"Securities" means the Purchased Shares, the shares of Common
Stock issuable upon conversion of the Purchased Shares, the Warrants,
the Warrant Shares and the Additional Preferred Shares.
"Securities Act" means the Securities Act of 1933, as amended
(or any successor statute thereto), and the rules and regulations of
the Commission promulgated thereunder.
"Series B Preferred Stock" has the meaning assigned to such
term in the recital to this Agreement.
"Subsidiary" means, as of the relevant date of determination,
with respect to any Person, a corporation or other entity of which 50%
or more of the voting power of the outstanding voting equity securities
or 50% or more of the outstanding economic equity interest is held,
directly or indirectly, by such Person. Unless otherwise qualified, or
the context otherwise requires, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or
Subsidiaries of Integra.
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"Transaction Documents" means collectively, this Agreement,
the Warrants, the Certificate of Designation and the Registration
Rights Agreement.
"Warrant Shares" has the meaning set forth in Section 1.1 of
this Agreement.
"Warrants" has the meaning ascribed to such term in the
recital to this Agreement.
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SECTION I. PURCHASE AND SALE OF SERIES B
PREFERRED STOCK AND WARRANTS
1.1 Purchase and Sale of Series B Preferred Stock and Warrants. Subject
to the terms and conditions herein set forth, Integra agrees to issue and sell
to each of the Purchasers, and each of the Purchasers agrees that it will
purchase from Integra, for the aggregate purchase price set forth opposite such
Purchaser's name on Schedule 1 hereto, on the Closing Date, (i) the aggregate
number of shares of Series B Preferred Stock set forth opposite such Purchaser's
name on Schedule 1 hereto (all of the shares of Series B Preferred Stock being
purchased pursuant hereto being referred to herein as "Purchased Shares"), and
(ii) the Warrant to purchase the aggregate number of shares of Common Stock set
forth opposite such Purchaser's name on Schedule 1 hereto (all of the shares of
Common Stock issuable upon exercise of the Warrants being purchased pursuant
hereto being referred to herein as the "Warrant Shares").
1.2 Certificate of Designation. The Purchased Shares will have the
rights, preferences, privileges and restrictions set forth in the Certificate of
Designation of Series B Preferred Stock to Integra's Certificate of
Incorporation attached hereto as Exhibit A (the "Certificate of Designation"),
which shall be filed by Integra with the Secretary of State of the State of
Delaware prior to the Closing (as hereinafter defined).
1.3 Additional Preferred Stock.
(a) At any time within 180 days after the Closing Date (the
"Initial Term") on 14 days written notice, Integra will have the right
(the "Put Right") to require the Purchasers (or certain Affiliates
thereof) to purchase up to an additional $2,000,000 of convertible
preferred stock having substantially identical terms as the Series B
Preferred Stock ("Additional Preferred Stock"), with each Purchaser
purchasing that proportion of the Additional Preferred Stock equal to
such Purchaser's proportionate initial investment in the Series B
Preferred Stock, provided that the conversion price for such Additional
Preferred Stock shall be equal to the lesser of (i) the Conversion
Price, which initially shall be $3.82 per share of Common Stock, as
adjusted and then in effect (the "Conversion Price") or (ii) the
average closing price of Integra's Common Stock for the ten (10)
trading days ending two days prior to the date of issuance of the
Additional Preferred Stock.
(b) If the Initial Term expires without the exercise of the
Put Right by Integra, such Put Right will continue for an additional
180 days (the "Second Term"), subject to the receipt by the Purchasers
of a certificate from the Chief Executive Officer of Integra (the "CEO
Certificate") certifying that the representations and warranties
contained in Section III of this Agreement are true and correct in all
material respects as of the exercise date of the Put Right as if made
on and as of such date and as if all references to Purchased Shares
include the Additional Preferred Stock, and that no material adverse
change in the Condition of Integra (other than operating losses
consistent with the historic results of Integra) has occurred since the
Closing Date.
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1.4 Closing. Unless this Agreement shall have terminated pursuant to
Section VIII and subject to the satisfaction or waiver of the conditions set
forth in Sections IV and V (except for Sections 4.10, 4.11 and 5.5, which shall
occur simultaneously with the Closing (as hereinafter defined)), the closing of
the purchase and issuance of the Purchased Shares and the Warrants (the
"Closing") shall take place at the offices of Xxxx, Weiss, Rifkind, Xxxxxxx &
Xxxxxxxx, at 10:00 a.m., local time, on March 29, 1999, or at such time and on
such date that Integra and the Purchasers may agree in writing (the "Closing
Date"). On the Closing Date, Integra shall deliver to the Purchasers (a) stock
certificates representing the Purchased Shares and (b) the Warrants, against
delivery by the Purchasers to Integra of the aggregate purchase price therefor
by wire transfer of immediately available funds.
SECTION II. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Integra represents and warrants to the Purchasers as follows:
2.1 Corporate Existence and Power. Each of Integra and its Subsidiaries
(a) is a corporation or limited liability company duly incorporated and
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation; (b) has all requisite corporate (or limited
liability company) power and authority to own and operate its property, to lease
the property it operates as lessee and to conduct the business in which it is
currently engaged as described in the SEC Documents; (c) is duly qualified as a
foreign corporation or other entity, licensed and in good standing under the
laws of each jurisdiction in which its ownership, lease or operation of property
or the conduct of its business requires such qualification, except to the extent
that the failure to do so or be so would not have a material adverse effect on
the Condition of Integra; and (d) has the requisite corporate (or limited
liability company) power and authority to execute, deliver and perform its
obligations under this Agreement and each of the other Transaction Documents.
2.2 Corporate Authorization; No . The execution, delivery and
performance by Integra of this Agreement and each of the other Transaction
Documents and the transactions contemplated hereby and thereby, including,
without limitation, the sale, issuance and delivery of the Securities (a) are
within Integra's corporate power and have been duly authorized by all necessary
corporate action of Integra; (b) do not contravene the terms of the Certificate
of Incorporation or By-laws, or any organizational or governing documents, or
any amendment thereof, of the Subsidiaries; (c) do not violate, conflict with or
result in any breach or contravention of or the creation of any Lien under, any
material Contractual Obligation of Integra or any of its Subsidiaries, or any
Requirement of Law applicable to Integra or any of its Subsidiaries; and (d) do
not violate any judgment, injunction, writ, award, decree or order of any nature
(collectively, "Orders") of any Governmental Authority against, or binding upon,
Integra or any of the Subsidiaries except for those Orders the violation of
which would not have a material adverse effect on the Condition of Integra.
Neither Integra nor any of its Subsidiaries previously entered into any
agreement which is currently in effect or by which Integra is currently bound,
granting any rights to any Person which are inconsistent with the rights to be
granted by Integra in this Agreement and each of the other Transaction
Documents.
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2.3 Governmental Authorization; Third Party Consents. Other than (a)
the filing and approval of an application for the listing on NASDAQ of the
shares of Common Stock issuable upon conversion of the Purchased Shares and the
exercise of the Warrants, (b) the filing of the Certificate of Designation, (c)
those required pursuant to the applicable state securities or "blue sky" laws,
with respect to the offer and sale of the Securities and (d) with respect to the
performance by Integra of the Registration Rights Agreement, the registration of
the Registrable Securities (as defined in the Registration Rights Agreement)
covered thereby with the Commission and the registration or qualification of
such Registrable Securities and other filings pursuant to applicable state
securities or "blue sky" laws, no approval, consent, compliance, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person, including, without limitation, any
approval or authorization of Integra's stockholders, any further approval of the
Board of Directors or any approval of NASDAQ, and no lapse of a waiting period
under a Requirement of Law, is necessary or required in connection with the
execution, delivery or performance (including, without limitation, the sale,
issuance and delivery of the Securities) by Integra of this Agreement, each of
the other Transaction Documents and the transactions contemplated hereby or
thereby.
2.4 Binding Effect. This Agreement and each of the other Transaction
Documents have been duly executed and delivered by Integra and constitute the
legal, valid and binding obligations of Integra, enforceable against Integra in
accordance with their terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by general principles of equity relating to enforceability
(regardless of whether considered in a proceeding at law or in equity).
2.5 Litigation. Except as set forth in the SEC Documents, the Financial
Statements (including the draft notes thereto) or Schedule 2.5, there are no
actions, suits, proceedings, claims, complaints, disputes or investigations
pending or threatened, at law, in equity, in arbitration or before any
Governmental Authority against Integra or any of its Subsidiaries and with
respect to which Integra or any of its Subsidiaries is responsible by way of
indemnity or otherwise, which would, if adversely determined, (a) have a
material adverse effect on the Condition of Integra or (b) have an adverse
effect on the ability of Integra to perform its obligations under this Agreement
and each of the other Transaction Documents. No Order has been issued by any
court or other Governmental Authority against Integra or any of its Subsidiaries
purporting to enjoin or restrain the execution, delivery or performance of this
Agreement or any of the other Transaction Documents.
2.6 Compliance with Laws.
(a) Each of Integra and its Subsidiaries is in compliance with
all Requirements of Law in all respects, except to the extent that the
failure to comply with such Requirements of Law would not have a
material adverse effect on the Condition of Integra.
(b) (i) Each of Integra and its Subsidiaries has all licenses,
permits, orders or approvals of any Governmental Authority
(collectively, "Permits") that are material to
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or necessary for the conduct of the business of Integra in the manner
described in the SEC Documents, except to the extent that the failure
to have such Permits would not have a material adverse effect on the
Condition of Integra; (ii) such Permits are in full force and effect;
and (iii) no violations are or have been recorded in respect of any
Permit.
(c) The property, assets and operations at any time owned or
leased by Integra have been in compliance in all material respects with
all applicable Environmental Laws, while so owned or leased, except to
the extent that the failure to comply with such Environmental Laws
would not have a material adverse effect on the Condition of Integra.
2.7 Capitalization.
(a) The authorized capital stock of Integra at the close of
business on March 22, 1999 consisted of (x) 60,000,000 shares of Common
Stock, of which 15,730,933 shares are issued and outstanding and (y)
15,000,000 shares of preferred stock, par value $.01 per share, of
which (i) 2,000,000 shares have been designated as Series A Preferred
Stock and of which 500,000 shares are issued and outstanding and (ii)
120,000 shares have been designated as Series B Preferred Stock and of
which no shares are issued and outstanding. Integra has reserved an
aggregate of 2,617,801 shares of Common Stock for issuance upon
conversion of the Purchased Shares and 240,000 shares of Common Stock
for issuance upon exercise of the Warrants. Except as set forth in
Schedule 2.7, there are no options, warrants, conversion privileges or
other rights presently outstanding to purchase or otherwise acquire any
authorized but unissued or unauthorized shares or treasury shares of
Integra's capital stock.
(b) There has been no change in the authorized, issued and
outstanding capital stock of Integra in the interval between March 22,
1999 and the Closing Date, except for shares of Common Stock issued
upon the exercise of warrants or options, or purchased by Integra
pursuant to its current share repurchase program.
(c) The Purchased Shares are duly authorized and, when issued
and sold to the Purchasers after payment therefor, will be validly
issued, fully paid and nonassessable by Integra. The shares of Common
Stock issuable upon conversion of the Purchased Shares and the exercise
of the Warrants are duly authorized and, when issued in compliance with
the provisions of this Agreement, the Certificate of Incorporation, the
Certificate of Designation (in the case of the shares of Common Stock
issuable upon conversion of the Purchased Shares) and the Warrants (in
the case of the Warrant Shares) will be validly issued, fully paid and
nonassessable by Integra. The issued and outstanding shares of Common
Stock are all duly authorized, validly issued, fully paid and
nonassessable by Integra, and were issued in compliance with the
registration and qualification requirements of all applicable federal
securities laws.
2.8 No Default or Breach. Except as set forth in Schedule 2.8, neither
Integra nor any of its Subsidiaries has received notice of, and is not in,
default under or with respect to any,
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Contractual Obligation in any respect, which, individually or together with all
such defaults, could have a material adverse effect on the Condition of Integra,
or which could materially adversely affect the ability of Integra to perform its
obligations under this Agreement or any of the other Transaction Documents.
2.9 Taxes. Each of Integra and its Subsidiaries has filed or caused to
be filed, or has properly filed extensions for, all tax returns which are
required to be filed for federal, state, local and foreign tax purposes and has
paid or caused to be paid all taxes required to be paid by it and all
assessments received by it to the extent that such taxes have become due, except
taxes the validity or amount of which is being contested in good faith by
appropriate proceedings and with respect to which adequate reserves have been
set aside. Each of Integra and its Subsidiaries has paid or caused to be paid,
or has established reserves that are adequate in all material respects, for all
tax liabilities applicable to Integra and its Subsidiaries for all fiscal years
which have not been examined and reported on by the taxing authorities (or
closed by applicable statutes).
2.10 Financial Statements. Integra has heretofore delivered to the
Purchasers true and correct copies of its unaudited consolidated financial
statements (balance sheet and statements of operations, cash flows and
shareholders' equity, together with draft notes thereto) for the fiscal year
ended and as at December 31, 1998 (the "Financial Statements"). The Financial
Statements comply in all material respects with the requirements of the Exchange
Act and have been prepared in accordance with GAAP applied on a consistent basis
throughout the periods indicated and with each other, except as may be indicated
therein or in the draft notes thereto. The Financial Statements fairly present
the consolidated financial condition, operating results and cash flows of
Integra as of the respective dates and for the respective periods indicated in
accordance with GAAP.
2.11 No Material Adverse Change; Ordinary Course of Business. Except as
set forth in Schedule 2.11 hereto or the SEC Documents or as previously
disclosed to the Purchasers in writing, (i) since December 31, 1998, there has
not been any material adverse change in the Condition of Integra (other than the
incurrence of operating losses consistent with historic results of Integra) and
(ii) since December 31, 1998, neither Integra nor any of its Subsidiaries has
participated in any transaction or acted outside the ordinary course of
business.
2.12 SEC Documents.
(a) Integra has filed all SEC Documents required to be filed
by it since December 31, 1997 under the Securities Act or the Exchange
Act, and all amendments thereto.
(b) As of its filing date, each SEC Document (including all
exhibits and schedules thereto and documents incorporated by reference
therein), in each case as amended, referred to in subsection (a) above
(i) complied in all material respects with the applicable requirements
of the Exchange Act and (ii) did 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 light of the circumstances under
which they were made, not misleading. Integra is not
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aware of any issues raised by, or correspondence (other than routine
filing packages and cover letters) with, the Commission with respect to
any of the SEC Documents.
2.13 Investment Company. Integra is not an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
2.14 Private Offering. No form of general solicitation or general
advertising was used by Integra or its representatives in connection with the
offer or sale of the Purchased Shares or the Warrants. No registration of the
Purchased Shares or the Warrants, pursuant to the provisions of the Securities
Act or any state securities or "blue sky" laws, is required on the date hereof
or on the Closing Date by the offer, sale or issuance of the Securities. Integra
hereby agrees that neither it nor anyone acting on its behalf, will offer to
sell the Purchased Shares or the Warrants or any other security so as to require
the registration of the Purchased Shares or the Warrants, pursuant to the
provisions of the Securities Act or any state securities or "blue sky" laws,
unless such securities are so registered.
2.15 Employee Benefit Plans. All employee benefit plans (as defined in
Section 3(3) of ERISA) or arrangements of Integra or any of the Subsidiaries are
in substantial compliance with all applicable Requirements of Law. The execution
and delivery of this Agreement and each of the other Transaction Documents, the
purchase and sale of the Purchased Shares hereunder and the consummation of the
transactions contemplated hereby and thereby will not result in any prohibited
transaction within the meaning of Section 406 of ERISA or Section 4975 of the
Code, assuming that none of the consideration received by Integra pursuant to
this Agreement is derived from the assets of any employee benefit plan.
2.16 Title to Assets. Except as set forth in Schedule 2.16, each of
Integra and its Subsidiaries has good title to all of its properties and assets
used in the business described in the SEC Documents and reflected as owned on
the Financial Statements or so described in any Schedule hereto, in each case
free and clear of any Lien, except for (a) Liens specifically described on the
notes to the Financial Statements and (b) Liens not material to the Condition of
Integra.
2.17 Intellectual Property.
(a) Schedule 2.17(a) sets forth all United States and foreign
patents and patent applications, trademark and service xxxx registrations and
applications, and copyright registrations and applications owned or licensed by
Integra and all material licenses, sublicenses, and other agreements or
permissions ("IP Licenses") under which Integra is a licensor or licensee or
otherwise is authorized to use or practice any Intellectual Property (as defined
below).
(b) Except as set forth in Schedule 2.17(b), Integra owns or
otherwise has the right to use, and will continue to own or otherwise have the
right to use immediately following the Closing, free and clear of any and all
Encumbrances, all United States and foreign patents and patent applications,
trademark and service xxxx registrations and applications,
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copyright registrations and applications, trade secrets, know-how, software, and
other technology and proprietary rights (collectively, "Intellectual Property")
used in the operation of its business as described in the SEC Documents.
(c) Except as set forth on Schedule 2.17(c), to the best of
Integra's knowledge, Integra's use or licensing of the Intellectual Property
used in the operation of its business as described in the SEC Documents does not
infringe or otherwise violate any Intellectual Property rights of any third
party. Except as set forth on Schedule 2.17(c), no litigation is pending and no
claim has been made in writing against Integra or, to the best of Integra's
knowledge, is threatened contesting the right of Integra to sell or license to
third parties or use the Intellectual Property presently sold or licensed to
third parties or used by Integra.
(d) Integra has taken all reasonable precautions to protect
the secrecy, confidentiality, and value of its trade secrets and the proprietary
nature and value of its know-how, patents, and other technology. Each employee
and third party who has contributed to the development of Intellectual Property
on behalf of Integra has signed an agreement with Integra stating that such
employee or third party (i) shall maintain the confidentiality of Integra's
trade secrets and other confidential information, and (ii) assigns to Integra
all rights that such employee or third party might have in such Intellectual
Property, except where the terms of particular agreements provide otherwise. To
the knowledge of Integra, no such employee or third party has materially
breached any such agreement.
2.18 Trade Relations. Except as set forth in Schedule 2.18, there
exists no actual or threatened termination, cancellation or limitation of, or
any adverse modification or change in, the business relationship of Integra or
any of its Subsidiaries with, any customer or any group of customers whose
purchases are individually or in the aggregate material to the business of
Integra or any of its Subsidiaries, or with any material supplier, and there
exists no present condition or state of fact or circumstances that would
materially adversely affect the Condition of Integra or prevent Integra from
conducting its business after the consummation of the transactions contemplated
by this Agreement and each of the other Transaction Documents, in substantially
the same manner in which such business has heretofore been conducted and
described in the SEC Documents.
2.19 Contracts and Other Agreements. All of the Contractual Obligations
of Integra and any of its Subsidiaries that are currently in effect and are
required to be described in the SEC Documents or to be filed as exhibits thereto
are (a) described in the SEC Documents or filed as exhibits thereto and (b)
valid, subsisting, in full force and effect and binding upon Integra or its
Subsidiaries, as the case may be, and, to the knowledge of Integra, the other
parties thereto, in accordance with their terms. Except as set forth on Schedule
2.19, Integra has paid in full or accrued all material amounts currently due
thereunder and has satisfied in full or provided for all of its currently
matured liabilities and obligations thereunder, and is not in default under any
of them. Except as set forth on Schedule 2.19, to the knowledge of Integra, no
other party to any such Contractual Obligation is in breach thereof or in
default thereunder nor does any condition
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exist that with notice or lapse of time or both will constitute a breach thereof
or default thereunder by such other party, except for such breaches or defaults
that would not have a material adverse effect on the Condition of Integra.
2.20 Liabilities. As at December 31, 1998, neither Integra nor any of
its Subsidiaries had any direct or indirect obligation or liability required by
GAAP to be set forth on its financial statements or the footnotes thereto (the
"Liabilities") that were not fully and adequately reflected or reserved against
in the Financial Statements.
2.21 Broker's, Finder's or Similar Fees. There are no brokerage
commissions, finder's fees or similar fees or commissions payable by Integra in
connection with the transactions contemplated hereby based on any agreement,
arrangement or understanding with Integra or any of its Subsidiaries or any
action taken by any such entity.
2.22 Disclosure; Agreement and Other Documents. This Agreement, each of
the other Transaction Documents and each of the certificates furnished to the
Purchasers by Integra in connection with the purchase and sale of the Purchased
Shares and the Warrants at or prior to the Closing, taken as a whole, do not
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements contained herein or therein, in the
light of the circumstances under which they were made, not misleading.
2.23 NeuroCare Acquisition Agreement. Integra has delivered to the
Purchasers a true and complete copy of the NeuroCare Acquisition Agreement, and
all of the representations and warranties of Integra as set forth therein shall
be true and complete in all material respects as of the date hereof and as at
the Closing Date.
SECTION III. REPRESENTATIONS AND WARRANTIES
OF THE PURCHASERS
Each of the Purchasers hereby represents and warrants (severally as to
itself and not jointly) to Integra as follows:
3.1 Existence and Power. Such Purchaser that is an entity (a) is duly
organized and validly existing under the laws of the jurisdiction of its
formation and (b) has the requisite power and authority to execute, deliver and
perform its obligations under this Agreement and each of the other Transaction
Documents to which it is a party.
3.2 Authorization; No Contravention. The execution, delivery and
performance by such Purchaser of this Agreement and each of the other
Transaction Documents to which it is a party and the transactions contemplated
hereby and thereby, including, without limitation, the purchase of the Purchased
Shares and the Warrants, (a) have been duly authorized by all necessary action,
(b) do not contravene the terms of such Purchaser's organizational documents, or
any amendment thereof, and (c) do not violate, conflict with or result in any
breach or contravention of or the creation of any Lien under, any Contractual
Obligation of such Purchaser, or any Requirement of Law applicable to such
Purchaser.
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3.3 Governmental Authorization; Third Party Consents. No approval,
consent, compliance, exemption, authorization, or other action by, or notice to,
or filing with, any Governmental Authority or any other Person, and no lapse of
a waiting period under a Requirement of Law, is necessary or required in
connection with the execution, delivery or performance (including, without
limitation, the purchase of the Purchased Shares and the Warrants) by, or
enforcement against, such Purchaser of this Agreement, each of the other
Transaction Documents to which it is a party and the transactions contemplated
hereby or thereby.
3.4 Binding Effect. This Agreement and each of the other Transaction
Documents to which it is a party have been duly executed and delivered by such
Purchaser and constitute the legal, valid and binding obligations of such
Purchaser, enforceable against it in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability (regardless of whether considered in a
proceeding at law or in equity).
3.5 Purchase for Own Account. The Purchased Shares and the Warrants to
be acquired by such Purchaser pursuant to this Agreement are being or will be
acquired for its own account and with no intention of distributing or reselling
such Purchased Shares or any part thereof in any transaction that would be in
violation of the securities laws of the United States of America, or any state,
without prejudice, however, to the rights of such Purchaser at all times to sell
or otherwise dispose of all or any part of such Purchased Shares or Warrants
under an effective registration statement under the Securities Act, or under an
exemption from such registration available under the Securities Act, and
subject, nevertheless, to the disposition of such Purchaser's property being at
all times within its control. If such Purchaser should in the future decide to
dispose of any of the Securities, such Purchaser understands and agrees that it
may do so only in compliance with the Securities Act and applicable state
securities laws, as then in effect. Such Purchaser agrees to the imprinting, so
long as required by law, of a legend on certificates representing the Securities
substantially to the following effect:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF
ANY STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES
LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE ACT."
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE ENTITLED TO THE BENEFITS
OF A REGISTRATION RIGHTS AGREEMENT AMONG INTEGRA LIFESCIENCES CORPORATION AND
THE ORIGINAL PURCHASERS OF THE PREFERRED STOCK REPRESENTED HEREBY. TRANSFEREES
OF SUCH SECURITIES SHOULD REVIEW SUCH AGREEMENT TO DETERMINE THEIR RIGHTS."
3.6 Accreditation; Sophistication; Other Securities Laws Matters. Each
Purchaser (a) is an "accredited investor" within the meaning of Rule 501 under
the Securities Act; (b) has
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sufficient knowledge and experience in investing in companies similar to Integra
so as to be able to evaluate the risks and merits of its investment in Integra
and is able financially to bear the risks thereof; (c) has had an opportunity to
discuss Integra's business, management and financial affairs with Integra's
management; and (d) is a resident of the jurisdiction listed next to its name on
Schedule 1 hereto for purposes of state "blue sky" securities law purposes.
3.7 Broker's, Finder's or Similar Fees. There are no brokerage
commissions, finder's fees or similar fees or commissions payable by the
Purchasers or any of them, in connection with the transactions contemplated
hereby based on any agreement, arrangement or understanding with such Purchaser
or any action taken by such Purchaser.
SECTION IV. CONDITIONS TO THE OBLIGATION
OF THE PURCHASERS TO CLOSE
The obligation of the Purchasers to purchase the Purchased Shares and
the Warrants, to pay the purchase price therefor at the Closing and to perform
any obligations hereunder shall be subject to the satisfaction as determined by,
or waiver by, the Purchasers of the following conditions on or before the
Closing Date.
4.1 Representations and Warranties. The representations and warranties
of Integra contained in Section II hereof shall be true and correct in all
material respects at and on the Closing Date as if made at and on such date,
except to the extent that any representation and warranty expressly speaks as of
an earlier date, in which case such representation and warranty is true and
correct as of such date and except for any activities or transactions which may
have taken place after the date hereof which are contemplated by this Agreement.
4.2 Compliance with this Agreement. Integra shall have performed and
complied in all material respects with all of its agreements and conditions set
forth herein that are required to be performed or complied with by Integra on or
before the Closing Date.
4.3 Secretary's Certificate. The Purchasers shall have received a
certificate from Integra, in form and substance satisfactory to the Purchasers,
dated the Closing Date and signed by a secretary or an assistant secretary of
Integra, certifying (a) that the attached copies of the Certificate of
Incorporation, the By-laws and resolutions of the Board of Directors of Integra
approving this Agreement, each of the other Transaction Documents and the
transactions contemplated hereby and thereby, are all true, complete and correct
and remain unamended and in full force and effect, and (b) as to the incumbency
and specimen signature of each officer of Integra executing this Agreement, each
of the other Transaction Documents and any other document delivered in
connection herewith on behalf of Integra.
4.4 Officers' Certificate. The Purchasers shall have received a
certificate from Integra, in form and substance satisfactory to the Purchasers,
dated the Closing Date and signed by Integra's chief executive officer and its
treasurer, certifying that (a) the representations and warranties of Integra
contained in Section II hereof are true and correct in all material respects on
the Closing Date and (b) Integra has performed and complied with in all material
respects all of
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the agreements and conditions set forth or contemplated herein that are required
to be performed or complied with by Integra on or before the Closing Date.
4.5 Documents. The Purchasers shall have received true, complete and
correct copies of such documents as they may reasonably request in connection
with or relating to the issue and sale of the Purchased Shares and the
transactions contemplated hereby, all in form and substance reasonably
satisfactory to the Purchasers.
4.6 Filing of Certificate of Designation. The Certificate of
Designation shall have been duly filed by Integra with the Secretary of State of
the State of Delaware in accordance with the General Corporation Law of the
State of Delaware.
4.7 Registration Rights Agreement. Integra shall have duly executed and
delivered the Registration Rights Agreement, substantially in the form attached
hereto as Exhibit C.
4.8 Opinion of Counsel. The Purchasers shall have received an opinion
of counsel to Integra, dated the Closing Date, relating to the transactions
contemplated hereby or referred to herein, substantially in the form attached
hereto as Exhibit D.
4.9 Approval of Counsel to the Purchasers. All actions and proceedings
hereunder and all documents required to be delivered by Integra hereunder or in
connection with the consummation of the transactions contemplated hereby, and
all other related matters, shall have been acceptable to Xxxx, Weiss, Rifkind,
Xxxxxxx & Xxxxxxxx, counsel to the Purchasers, in their reasonable judgment as
to their form and substance.
4.10 Purchased Shares. Integra shall have delivered to each of the
Purchasers stock certificates in definitive form representing the number of
Purchased Shares set forth opposite such Purchaser's name on Schedule 1 hereto
and registered in the name of such Purchaser.
4.11 Warrants. Integra shall have duly executed and delivered to the
Purchasers the Warrants, each substantially in the form attached hereto as
Exhibit A.
4.12 Consents and Approvals. All consents, exemptions, authorizations,
or other actions by, or notices to, or filings with (other than the filings
referenced in Section 2.3(a) and (d) hereof), Governmental Authorities and other
Persons in respect of all Requirements of Law and with respect to those
Contractual Obligations of Integra which are necessary or required in connection
with the execution, delivery or performance (including, without limitation, the
issuance of the Purchased Shares, the Warrants, shares of Common Stock issuable
upon conversion of the Purchased Shares and the exercise of the Warrants) by, or
enforcement against, Integra of this Agreement and each of the other Transaction
Documents shall have been obtained and be in full force and effect, and each of
the Purchasers shall have been furnished with appropriate evidence thereof.
4.13 No Litigation. No action, suit, proceeding, claim or dispute shall
have been brought or otherwise arisen at law, in equity, in arbitration or
before any Governmental Authority against Integra or any of its Subsidiaries
which would, if adversely determined, (a) have a
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material adverse effect on the Condition of Integra or (b) have a material
adverse effect on the ability of Integra to perform its obligations under this
Agreement or any of the other Transaction Documents.
4.14 No Material Judgment or Order. There shall not be on the Closing
Date any Order of a court of competent jurisdiction or any ruling of any
Governmental Authority or any condition imposed under any Requirement of Law
which would, in the judgment of the Purchasers, (a) prohibit or restrict (i) the
purchase of the Purchased Shares or (ii) the consummation of the transactions
contemplated by this Agreement, (b) subject the Purchasers to any penalty or
other onerous condition under or pursuant to any Requirement of Law if the
Purchased Shares were to be purchased hereunder or (c) restrict the operation of
the business of Integra or any of the Subsidiaries as conducted on the date
hereof in a manner that would have a material adverse effect on the Condition of
Integra.
4.15 No Material Adverse Change. Since the date hereof, there shall
have been no material adverse change in the Condition of Integra (other than
operating losses consistent with the historic results of Integra).
4.16 Neurocare Acquisition. All conditions precedent to the
consummation of the Neurocare Acquisition Agreement shall have been satisfied in
all material respects (and not waived, except for any waiver which would not be
adverse to the Purchasers in any material respect).
SECTION V. CONDITIONS TO THE OBLIGATION
OF THE COMPANY TO CLOSE
The obligations of Integra to issue and sell the Purchased Shares and to perform
its other obligations hereunder, shall be subject to the satisfaction as
determined by, or waiver by, Integra of the following conditions on or before
the Closing Date:
5.1 Representations and Warranties. The representations and warranties
of the Purchasers contained in Section III hereof shall be true and correct on
at and on the Closing Date as if made at and on such date, except to the extent
that any representation and warranty expressly speaks as of an earlier date, in
which case such representation and warranty is true and correct as of such date
and except for any activities or transactions which may have taken place after
the date hereof which are contemplated by this Agreement.
5.2 Compliance with this Agreement. The Purchasers shall have performed
and complied in all material respects with all of their agreements and
conditions set forth herein that are required to be performed or complied with
by the Purchasers on or before the Closing Date.
5.3 Registration Rights Agreement. The Purchasers shall have duly
executed and delivered the Registration Rights Agreement, substantially in the
form attached hereto as Exhibit C.
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5.4 Consents and Approvals. All consents, exemptions, authorizations,
or other actions by, or notices to, or filings with, Governmental Authorities
and other Persons in respect of all Requirements of Law and with respect to
those Contractual Obligations of the Purchasers which are necessary or required
in connection with the execution, delivery or performance (including, without
limitation, the purchase of the Purchased Shares, the Warrants, and the shares
of Common Stock issuable upon conversion of the Purchased Shares and the
exercise of the Warrants) by, or enforcement against, the Purchasers of this
Agreement shall have been obtained and be in full force and effect, and Integra
shall have been furnished with appropriate evidence thereof.
5.5 Payment of Purchase Price. Integra shall have received the
aggregate purchase price for the Purchased Shares and the Warrants.
5.6 No Material Judgment or Order. There shall not be on the Closing
Date any Order of a court of competent jurisdiction or any ruling of any
Governmental Authority or any condition imposed under any Requirement of Law
which would, in the judgment of Integra, (a) prohibit or restrict (i) the sale
of the Purchased Shares or the Warrants or (ii) the consummation of the
transactions contemplated by this Agreement or (b) subject Integra to any
penalty or other onerous condition under or pursuant to any Requirement of Law
if the Purchased Shares were to be sold hereunder.
5.7 Opinion of Counsel. Integra will have received the opinion of Paul,
Weiss, Xxxxxxx & Xxxxxxxx, dated the Closing Date, relating to the transactions
contemplated hereby or referred to herein, substantially in the form attached
hereto as Exhibit E.
SECTION VI. INDEMNIFICATION
6.1 Indemnification. Except as otherwise provided in this Section VI,
Integra agrees to indemnify, defend and hold harmless each of the Purchasers and
their Affiliates and their respective officers, directors, agents, employees,
subsidiaries, members, partners and controlling persons (each, an "Indemnified
Party") to the fullest extent permitted by law from and against any and all
Losses (as hereinafter defined) resulting from, arising out of or relating to
any breach of any representation, warranty, covenant or agreement by Integra in
this Agreement or the other Transaction Documents, including, without
limitation, Losses arising out of or relating to any legal, administrative or
other actions (including actions brought by the Purchasers or Integra or any
equity holders of Integra or derivative actions brought by any Person claiming
through or in Integra's name), proceedings or investigations (whether formal or
informal), or written threats thereof, based upon, relating to or arising out of
this Agreement, each of the other Transaction Documents, the transactions
contemplated hereby and thereby, or any Indemnified Party's role therein or in
transactions contemplated hereby or thereby; provided, however, that the Integra
shall not be liable under this Section 6.1 to an Indemnified Party to the extent
that it is finally judicially determined that such Losses resulted primarily
from the material breach by such Indemnified Party of any representation,
warranty, covenant or other agreement of such Indemnified Party contained in
this Agreement; and provided, further, that if and to the extent that such
indemnification is unenforceable for any reason, then Integra shall make the
maximum
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contribution to the payment and satisfaction of such Losses which shall be
permissible under applicable laws. Losses means all losses, claims (including
any claim by a third party), damages, expenses (including reasonable fees,
disbursements and other charges of counsel incurred by the Indemnified Party in
any action between Integra and the Indemnified Party or between the Indemnified
Party and any third party or otherwise) or other liabilities; provided, however,
that Losses shall include only (a) direct out-of-pocket payments of judgments
and settlements, costs and expenses of the Indemnified Parties and (b)
diminution in value of the Purchased Shares directly attributable to a breach of
any representation, warranty, covenant or agreement by Integra in this Agreement
or the other Transaction Documents.
6.2 Notification. Each Indemnified Party under this Section VI will,
promptly after the receipt of notice of the commencement of any action,
investigation, claim or other proceeding against such Indemnified Party in
respect of which indemnity may be sought from Integra under this Section VI,
notify Integra in writing of the commencement thereof. The omission of any
Indemnified Party to so notify Integra of any such action shall not relieve
Integra from any liability which Integra may have to such Indemnified Party (a)
other than pursuant to this Section VI or (b) under this Section VI unless, and
only to the extent that, such omission results in Integra's forfeiture of
substantive rights or defenses. In case any such action, claim or other
proceeding shall be brought against any Indemnified Party and it shall notify
Integra of the commencement thereof, Integra shall be entitled to assume the
defense thereof at its own expense, with counsel satisfactory to such
Indemnified Party in its reasonable judgment; provided, however, that any
Indemnified Party may, at its own expense, retain separate counsel to
participate in such defense at its own expense. Notwithstanding the foregoing,
in any action, claim or proceeding in which both Integra, on the one hand, and
an Indemnified Party, on the other hand, are, or are reasonably likely to
become, a party, such Indemnified Party shall have the right to employ separate
counsel at the expense of Integra and to control its own defense of such action,
claim or proceeding if, in the reasonable opinion of counsel to such Indemnified
Party, a conflict or potential conflict exists between Integra, on the one hand,
and such Indemnified Party, on the other hand, that would make such separate
representation advisable; provided, however, that Integra shall not be liable
for the fees and expenses of more than one counsel to all Indemnified Parties.
Integra agrees that it will not, without the prior written consent of the
Purchasers, settle, compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding relating to the matters
contemplated hereby (if any Indemnified Party is a party thereto or has been
actually threatened to be made a party thereto) unless such settlement,
compromise or consent includes an unconditional release of the Purchasers and
each other Indemnified Party from all liability arising or that may arise out of
such claim, action or proceeding and imposes no obligations upon such
Indemnified Party. Integra shall not be liable for any settlement of any claim,
action or proceeding effected against an Indemnified Party without its written
consent, which consent shall not be unreasonably withheld. The rights accorded
to each Indemnified Party hereunder shall be the sole rights that such
Indemnified Party may have at common law, by separate agreement or otherwise;
provided, however, that notwithstanding the foregoing or anything to the
contrary contained in this Agreement, nothing in this Section VI shall restrict
or limit any rights that any Indemnified Party may have to seek equitable
relief.
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6.3 Registration Rights Agreement. Notwithstanding anything to the
contrary contained in this Section VI, the indemnification and contribution
provisions of the Registration Rights Agreement shall govern any claim made with
respect to registration statements filed pursuant thereto or sales made
thereunder.
SECTION VII. AFFIRMATIVE COVENANTS
Integra hereby covenants and agrees with the Purchasers with respect to this
Section VII so long as any shares of Preferred Stock, shares of Common Stock
issuable upon the conversion thereof, the Warrants or the Warrant Shares are
outstanding, except to the extent that a particular section of this Section VII
provides for an earlier termination as follows:
7.1 Preservation of Existence. From the date hereof until the Closing
Date, Integra shall, and shall use its best efforts to cause its Subsidiaries
to:
(a) preserve and maintain in full force and effect its
existence and good standing under the laws of its jurisdiction of
formation or organization;
(b) take all reasonable action to preserve and maintain in
full force and effect all material rights, privileges, qualifications,
applications, estimates, licenses and franchises necessary in the
normal conduct of its business;
(c) use its reasonable efforts to preserve its business
organization;
(d) conduct its business in accordance with sound business
practices and keep its useful and necessary properties in good working
order and condition (normal wear and tear excepted);
(e) comply with all Requirements of Law and with the
directions of any Governmental Authority having jurisdiction over
Integra or any of the Subsidiaries or their respective business or
property except to the extent that the failure to comply with any
Requirements of Law would not have a material adverse effect on the
Condition of Integra; and
(f) file or cause to be filed in a timely manner all reports,
applications, estimates and licenses that shall be required by a
Governmental Authority and that, if not timely filed, would have a
material adverse effect on the Condition of Integra.
7.2 Delivery of 1998 Audited Financial Statements.
(a) Integra shall deliver to the Purchasers as soon as
available a true and correct copy of its audited consolidated financial
statements (balance sheet and statement of
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operations, cash flows and shareholders equity, together with the notes
thereto) for the fiscal year ended and as at December 31, 1998 (the
"Audited Financial Statements") which will be the same in all material
respect as the Financial Statements.
(b) In the event the Audited Financial Statements differ in
any material respect from the Financial Statements, Integra shall
indemnify the Purchasers for the reduction in the value of the Series B
Preferred Stock, if any, caused by such differences by paying to the
Purchasers an amount in cash or shares of Common Stock equal to such
reduction in value.
7.3 Financial Statements and Other Information. Integra shall deliver
to the Purchasers, in form and substance satisfactory to the Purchasers:
(a) as soon as available, but not later than ninety (90) days
after the end of each fiscal year of Integra, a copy of the audited
consolidated balance sheet of Integra and its Subsidiaries as of the
end of such year and the related statements of operations and cash
flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous year, all in reasonable detail and
accompanied by a management summary and analysis of the operations of
Integra and its Subsidiaries for such fiscal year and by the opinion of
a nationally recognized independent certified public accounting firm
which report shall state without qualification that such consolidated
financial statements present fairly the financial condition as of such
date and results of operations and cash flows for the periods indicated
in conformity with GAAP applied on a consistent basis; provided,
however, that the delivery to each of the Purchasers of a copy of
Integra's Annual Report on Form 10-K for each fiscal year shall satisfy
the requirements of this Section 7.3(a);
(b) commencing with the fiscal period ending on March 31,
1999, as soon as available, but in any event not later than forty-five
(45) days after the end of each of the first three fiscal quarters of
each fiscal year, the unaudited consolidated balance sheet of Integra
and its Subsidiaries, and the related statements of operations and cash
flows for such quarter and for the period commencing on the first day
of the fiscal year and ending on the last day of such quarter, all
certified by an appropriate officer of Integra as presenting fairly the
financial condition as of such date and results of operations and cash
flows for the periods indicated in conformity with GAAP applied on a
consistent basis, subject to normal year-end audit adjustments and the
absence of footnotes required by GAAP; provided, however, that the
delivery to each of the Purchasers of a copy of Integra's Quarterly
Report on Form 10-Q for each fiscal quarter shall satisfy the
requirements of this Section 7.3(b);
(c) at any time when it is not subject to Section 13 or 15(d)
of the Exchange Act, upon request, to the Purchasers, information of
the type that would satisfy the requirement of subsection (d)(4)(i) of
Rule 144A (or any similar successor provision) under the Securities
Act; and
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(d) except as otherwise provided in Sections 7.3(a) and (b),
promptly after the same are filed, copies of all registration
statements, proxy statements, reports and other documents required to
be filed by Integra under the Securities Act or the Exchange Act, and
all amendments thereto.
7.4 Reservation of Shares. Integra shall at all times reserve and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issue or delivery upon conversion of the Purchased Shares, as provided in the
Certificate of Designation and the Certificate of Incorporation, and the
exercise of the Warrants, the number of shares of Common Stock that may be
issuable or deliverable upon such conversion or exercise. Integra shall issue
such shares of Common Stock in accordance with the terms of this Agreement, the
Certificate of Incorporation, the Certificate of Designation (in the case of the
shares of Common Stock issuable upon conversion of the Purchased Shares) and the
Warrants (in the case of the Warrant Shares), as the case may be, and otherwise
comply with the terms hereof and thereof.
7.5 Registration and Listing. If any shares of Common Stock required to
be reserved for purposes of conversion of the Purchased Shares, as provided in
the Certificate of Designation or the exercise of the Warrants, as provided in
the Warrants, require registration with or approval of any Governmental
Authority under any Federal or state or other applicable law before such shares
of Common Stock may be issued or delivered upon conversion or exercise, Integra
will in good faith and as expeditiously as possible cause such shares of Common
Stock to be duly registered or approved, as the case may be, unless such
registration or approval is required solely because of a breach of the
Purchasers' representation contained in Section 3.5. So long as the shares of
Common Stock are quoted on the NASDAQ or listed on any national securities
exchange, Integra will, if permitted by the rules of such system or exchange,
quote or list and keep quoted or listed on such system or exchange, upon
official notice of issuance, all shares of Common Stock issuable or deliverable
upon conversion of the Preferred Shares and exercise of the Warrants.
7.6 Board Representation. For so long as the Purchasers or Affiliates
thereof collectively own at least one half of their initial investment in the
Series B Preferred Stock or the Common Stock into which it is converted, the
Purchasers as a group shall be entitled to name one representative to Integra's
Board of Directors (the "Purchasers' Representative"), which Purchasers'
Representative shall be reasonably satisfactory to the Chief Executive Officer
of Integra and who initially shall be Xxxx Xxxxxxxxxx. Integra will use its best
efforts to cause the Purchasers' Representative to be nominated and to solicit
proxies for his election. The Purchasers as a group will also be entitled to
representation on significant committees of Integra Board of Directors.
7.7 Director and Officer Liability Insurance. Integra will maintain
director and officer liability insurance reasonably satisfactory to the
Purchasers.
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SECTION VIII. TERMINATION OF AGREEMENT
8.1 Termination. This Agreement may be terminated prior to the Closing
as follows:
(a) at any time on or prior to the Closing Date, by mutual
written consent of Integra and the Purchasers; or
(b) at the election of Integra or the Purchasers by written
notice to the other parties hereto after 5:00 p.m., New York City time
on April 30, 1999, if the transactions contemplated by this Agreement
shall not have been consummated pursuant hereto, unless such date is
extended by the mutual written consent of Integra and the Purchasers;
or
(c) at the election of Integra, if any one or more of the
conditions to its obligation to close set forth in Section V has not
been satisfied or waived and the Closing shall not have occurred on the
scheduled Closing Date; or
(d) at the election of the Purchasers, if any one or more of
the conditions to its obligation to close set forth in Section IV has
not been satisfied or waived and the Closing shall not have occurred on
the scheduled Closing Date; or
(e) at the election of Integra, if there has been a material
breach of any representation, warranty, covenant or agreement on the
part of the Purchasers contained in this Agreement, which breach has
not been cured within ten (10) Business Days of notice to the
Purchasers of such breach; or
(f) at the election of the Purchasers, if there has been a
material breach of any representation, warranty, covenant or agreement
on the part of Integra contained in this Agreement, which breach has
not been cured within ten (10) Business Days notice to Integra of such
breach.
If this Agreement so terminates, it shall become null and void and have no
further force or effect, except as provided in Section 8.2.
8.2 Survival. If this Agreement is terminated and the transactions
contemplated hereby are not consummated as described above, this Agreement shall
become void and of no further force and effect; provided, however, that (i) none
of the parties hereto shall have any liability in respect of a termination of
this Agreement pursuant to Section 8.1(a) or Section 8.1(b) and (ii) nothing
shall relieve any party from any liability for actual damages resulting from a
termination of this Agreement pursuant to Section 8.1(e) or 8.1(f); and provided
further, that none of the parties hereto shall have any liability for
speculative, indirect, unforeseeable or consequential damages resulting from a
termination of this Agreement pursuant to Section VIII.
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SECTION IX. MISCELLANEOUS
9.1 Survival of Representations and Warranties. Except for the
representations and warranties in Section 2.7(c) (which shall survive without
limitation), all of the representations and warranties made herein shall survive
the execution and delivery of this Agreement for a period ending 60 days after
the delivery by Integra to the Purchasers of its audited consolidated financial
statements (balance sheet and statement of operations, cash flows and
shareholders' equity, together with the notes hereto) for the fiscal year ended
and as at December 31, 1999; provided, however, that if Integra exercises its
Put Right during the Second Term the representations and warranties set forth in
the CEO Certificate shall survive for a period of one year following the receipt
by the Purchasers of the Additional Preferred Stock.
9.2 Notices. All notices, demands and other communications provided for
or permitted hereunder shall be made in writing and shall be by registered or
certified first-class mail, return receipt requested, telecopier, courier
service, overnight mail or personal delivery:
(i) if to Quantum Industrial Partners LDC:
Xxxx Xxxxxxxxx 0,
Xxxxxxxxxx
Curacao
Netherlands-Antilles
with a copy to:
Xxxxx Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxxx Xxxx, Esq.
and a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxxxx, Esq.
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(ii) If to SFM Domestic Investments LLC:
Xxxxx Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxxx Xxxx, Esq.
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxxxx, Esq.
(iii) if to Integra:
Integra LifeSciences Corporation
000 Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxxx,
President and CEO
with a copy to:
Drinker Xxxxxx & Xxxxx LLP
000 Xxxxxxx Xxxx Xxxx
Xxxxxxxxx, XX 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx III, Esq.
All such notices and communications shall be deemed to have been duly
given when delivered by hand, if personally delivered; when delivered by courier
or overnight mail, if delivered by commercial courier service or overnight mail;
five (5) Business Days after being deposited in the mail, postage prepaid, if
mailed; and when receipt is mechanically acknowledged, if telecopied.
9.3 Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of the parties
hereto. Subject to applicable securities laws, each of the Purchasers may assign
any of its rights under this Agreement to any of its Affiliates. Integra may not
assign any of its rights under this Agreement and each of the
-26-
other Transaction Documents, except to a successor-in-interest to Integra,
without the written consent of all of the Purchasers. Except as provided in
Section VI no Person other than the parties hereto and their successors and
permitted assigns is intended to be a beneficiary of this Agreement and each of
the other Transaction Documents.
9.4 Amendment and Waiver.
(a) No failure or delay on the part of Integra or the
Purchasers in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise
of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy.
(b) Any amendment, supplement or modification of or to any
provision of this Agreement, any waiver of any provision of this
Agreement, and any consent to any departure by Integra or the
Purchasers from the terms of any provision of this Agreement, shall be
effective (i) only if it is made or given in writing and signed by
Integra and the Purchasers, and (ii) only in the specific instance and
for the specific purpose for which made or given. Except where notice
is specifically required by this Agreement, no notice to or demand on
Integra in any case shall entitle Integra to any other or further
notice or demand in similar or other circumstances.
9.5 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
9.6 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
9.7 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW JERSEY, WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAW THEREOF.
9.8 Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired, unless the provisions held
invalid, illegal or unenforceable shall substantially impair the benefits of the
remaining provisions hereof.
9.9 Rules of Construction. Unless the context otherwise requires, "or"
is not exclusive, and references to sections or subsections refer to sections or
subsections of this Agreement.
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9.10 Entire Agreement. This Agreement, together with the exhibits and
schedules hereto, and the other Transaction Documents are intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein and therein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein or therein.
9.11 Fees. Upon the Closing, Integra shall reimburse the Purchasers for
their reasonable out-of-pocket expenses (including attorney's fees,
disbursements and other charges) incurred in connection with the transactions
contemplated by this Agreement; provided, however, that Integra shall not be
obligated to reimburse the Purchasers for any reasonable out-of-pocket expenses
in excess of $40,000 in the aggregate.
9.12 Publicity; Confidentiality.
(a) Except as may be required by applicable law or the rules
of any securities exchange or market on which shares of Common Stock
are traded, none of the parties hereto shall issue a publicity release
or public announcement or otherwise make any disclosure concerning this
Agreement, the transactions contemplated hereby or the business and
financial affairs of Integra, without prior approval by the other
parties hereto; provided, however, that nothing in this Agreement shall
restrict any Purchaser from disclosing information (i) that is already
publicly available, (ii) that was known to such Purchaser on a
non-confidential basis prior to its disclosure by Integra, (iii) that
may be required or appropriate in response to any summons or subpoena
or in connection with any litigation, provided that such Purchaser will
use reasonable efforts to notify Integra in advance of such disclosure
so as to permit Integra to seek a protective order or otherwise contest
such disclosure, and such Purchaser will use reasonable efforts to
cooperate, at the expense of Integra, with Integra in pursuing any such
protective order, (iv) to the extent that such Purchaser reasonably
believes it appropriate in order to protect its investment in the
Purchased Shares in order to comply with any Requirement of Law, (v) to
such Purchaser's officers, directors, agents, employees, members,
partners, controlling persons, auditors or counsel, (vi) to Persons who
are parties to similar confidentiality agreements or (vii) to the
prospective transferee in connection with any contemplated transfer of
any of the Securities. If any announcement is required by law or the
rules of any securities exchange or market on which shares of Common
Stock are traded to be made by any party hereto, prior to making such
announcement such party will deliver a draft of such announcement to
the other parties and shall give the other parties reasonable
opportunity to comment thereon.
(b) The Purchasers shall have the opportunity to review and
modify any provision of any publicly release or public announcement or
document which is to be released to the public or filed with the SEC,
which provision mentions Xxxxx Fund Management LLC or any of its
Affiliates, prior to the release of such document to the public or the
filing of such document with the SEC.
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9.13 Further Assurances. Each of the parties shall execute such
documents and perform such further acts (including, without limitation,
obtaining any consents, exemptions, authorizations or other actions by, or
giving any notices to, or making any filings with, any Governmental Authority or
any other Person) as may be reasonably required or desirable to carry out or to
perform the provisions of this Agreement.
9.14 Schedules. Anything disclosed on any schedule attached hereto
shall be deemed disclosed on all schedules attached hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their respective officers hereunto duly authorized on
the date first above written.
INTEGRA LIFESCIENCES CORPORATION
By: /s/Xxxxxx X. Xxxxx
------------------------------
Xxxxxx X. Xxxxx, President and
Chief Executive Officer
QUANTUM INDUSTRIAL PARTNERS LDC
By: /s/Xxxxxxx X. Xxxx
------------------------------
Xxxxxxx X. Xxxx, Attorney-In-Fact
SFM DOMESTIC INVESTMENTS LLC
By: /s/Xxxxxxx X. Xxxx
------------------------------
Xxxxxxx X. Xxxx, Attorney-In-Fact
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EXHIBITS
A Form of Warrant
B Certificate of Designation
C Amended and Restated Registration Rights Agreement
D Form of Drinker Xxxxxx & Xxxxx Opinion
E Form of Paul, Weiss, Xxxxxxx & Xxxxxxxx Opinion
SCHEDULES
1 Purchased Shares and Warrants and Purchase Price
2.5 Litigation
2.7 Capitalization
2.8 No Default or Breach
2.11 No Material Adverse Change; Ordinary Course of Business
2.16 Title to Assets
2.17(a) Intellectual Property
2.17(b) Infringements of Integra
2.17(c) Intellectual Property Litigation
2.18 Trade Relations
2.19 Contract and other agreements
Schedule 1
PURCHASED SHARES AND WARRANTS AND PURCHASE PRICE
--------------------------------------------------------------------------------
Shares of Series B
Preferred Stock
Purchased From Warrants Purchased
Purchaser the Company From the Company Purchase Price
Quantum Industrial Partners 75,000 180,000 $7,500,000
(principal place of business: Curaco)
SFM Domestic Investments LLC 25,000 60,000 $2,500,000
