EXHIBIT 10.1
WOMEN FIRST HEALTHCARE, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is made and
entered into as of May 12, 2003 by and between Women First HealthCare, Inc., a
Delaware corporation (the "Company"), and the Investors (each an "Investor" and,
collectively , the "Investors") listed on the Schedule of Investors attached
hereto as Exhibit A ("Schedule of Investors"). The Investors and the Company are
referred to collectively herein as the "Parties."
WITNESSETH:
WHEREAS, the Company has agreed with the holders of its Senior Secured
Notes due September 30, 2005 (the "Senior Secured Notes") to implement certain
amendments to the Senior Secured Notes and the Company's Senior Convertible
Redeemable Preferred Stock, Series A (the "Series A Preferred Stock"), and as
partial consideration therefor, the Company has agreed to issue certain Warrants
to purchase 2,000,000 shares of Common Stock (the "New Warrants") and cancel
existing Warrants to purchase 1,669,437 shares of Common Stock (the "Old
Warrants") (collectively, such transaction being referred to herein as the
"Restructuring");
WHEREAS, the holders of the Senior Secured Notes have required, as a
condition precedent to the closing of the Restructuring, that the Company sell
not less than $2,500,000 worth of the Company's common stock, $0.001 par value
per share ("Common Stock") to Xxxxxx X. Xxxxxx, the President, Chief Executive
Officer and Chairman of the Board of the Company, and the other Investors; and
WHEREAS, the Company desires to sell to the Investors, and the Investors
desire to purchase from the Company, shares of Common Stock on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties and
covenants herein contained, the Parties agree as follows:
1. AGREEMENT TO PURCHASE AND SELL STOCK. Subject to the terms and
conditions of this Agreement, the Company agrees to sell to the Investors at the
Closing (as defined below), and each Investor agrees to purchase from the
Company at the Closing, that number of shares of Common Stock (collectively, the
"Shares") determined by dividing the aggregate purchase price indicated opposite
such Investor's name on the Schedule of Investors by a price per share equal to
the average closing price of the Company's Common Stock on the Nasdaq National
Market from and including March 20, 2003 through April 24, 2003.
2. CLOSING MATTERS.
2.1 Closing. The purchase and sale of the Shares (the "Closing")
will take place at the offices of Xxxxxx & Xxxxxxx, 00000 Xxxx Xxxxx Xxxxx,
Xxxxx 000, Xxx Xxxxx, XX 00000 at 10:00 a.m. Pacific Time, on May 12, 2003, or
if any of the conditions set forth in Sections 6 or 7 (other than conditions
with respect to actions the respective Parties will take at
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the Closing itself) has not been satisfied, a later date selected by the Company
and a Majority in Interest of the Investors (defined below), which date shall be
within ten (10) business days following the satisfaction or waiver of all
conditions to the obligations of the Parties to consummate the transactions to
occur at the Closing (other than conditions with respect to actions the
respective Parties will take at the Closing itself) (such date, the "Closing
Date"). Against payment of the purchase price therefor, the Shares shall be
registered in the Investors' names or the names of the nominees of the Investors
pursuant to instructions delivered to the Company not less than two (2) business
days prior to the Closing Date, and certificates for such Shares will be
delivered to the Investors within ten (10) business days after the Closing Date.
2.2 Payment of Purchase Price; Escrow. Payment of the purchase price
for the Shares shall be made by the Investors on or before the Closing by wire
transfer of immediately available United States funds payable to the Company's
account pursuant to the wire transfer instructions provided by the Company.
Pending the Closing, all funds paid hereunder shall be deposited by the Company
in a separate account maintained by the Company for the benefit of the
Investors. If the Company accepts subscriptions (either in whole or in part) for
the Shares at or prior to the Closing Date, then all related subscription
proceeds received for subscriptions accepted (either in whole or in part) by the
Company shall be paid over to the Company at the Closing. If the Company shall
not have received and accepted an Investor's subscription (either in whole or in
part), then that subscription (or part thereof) shall be void and the relevant
funds paid by such Investor, without deduction therefrom or interest thereon,
shall be promptly returned to such Investor.
2.3 Return of Funds. Investor hereby authorizes and directs the
Company to return or direct the return of any funds not accepted by the Company
as purchase price for Shares from the separate account, without deduction
therefrom or interest thereon, to the same account from which the funds were
originally drawn.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to each Investor that the statements in the following
paragraphs of this Section 3 are true and correct:
3.1 Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company is duly authorized to conduct business and
is in good standing under the laws of each jurisdiction where such qualification
is required, except where the failure to be so qualified would not have a
material adverse effect on the business, financial condition, operations or
results of operations of the Company. The Company is not in default under or in
violation of any provision of its charter or bylaws. The Company has full power
and authority to execute and deliver this Agreement and to perform its
obligations hereunder.
3.2 Authorization. Except as set forth on the Schedule of Exceptions
hereto, all corporate action on the part of the Company necessary for the
authorization, execution and delivery of this Agreement, the performance of the
obligations of the Company at the Closing, the performance of the obligations of
the Company under Section 8 hereof and the issuance and delivery of the Shares,
has been taken, and this Agreement has been duly executed and delivered by the
Company and constitutes a valid and legally binding obligation of the Company,
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enforceable in accordance with its terms, except as may be limited by (i)
applicable bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the enforcement of creditors' rights
generally, (ii) the effect of rules of law governing the availability of
equitable remedies, and (iii) the unenforceability under certain circumstances
under law or court decisions of provisions providing for the indemnification of
or contribution to a party with respect to a liability where such
indemnification or contribution is contrary to public policy or prohibited by
law.
3.3 Valid Issuance of Stock. The Shares have been duly reserved for
issuance and, when issued, sold and delivered in accordance with the terms of
this Agreement for the consideration provided for herein, (i) will be duly and
validly issued, fully paid and nonassessable and will be free of any liens or
claims (other than those that may be created by the Investors); (ii) will be
free of any restrictions on transfer other than restrictions on transfer under
applicable federal and state securities laws; and (iii) will be issued in
compliance with all applicable federal and state securities laws.
3.4 Capitalization The entire authorized capital stock of the
Company consists of 40,000,000 shares of Common Stock, of which 22,971,417
shares were issued and outstanding as of May 6, 2003, and 5,000,000 shares of
preferred stock, $0.001 par value per share, of which 13,000 shares were
designated Senor Convertible Preferred Stock, Series A (the "Series A
Preferred"), all of which are issued and outstanding as of the date hereof. No
other shares of the Company's preferred stock are issued and outstanding as of
the date hereof. Except (i) as set forth in SEC Documents (as defined below),
(ii) as granted in the ordinary course of business pursuant to the Company's
1998 Long-Term Incentive Plan, Stock Incentive Plan and 1999 Non-Qualified Stock
Option Plan, and (iii) as contemplated by the Restructuring, including the
issuance of the New Warrants and cancellation of the Old Warrants concurrently
with the Closing, since the dates of the SEC Documents, there are no outstanding
or authorized warrants, options, purchase rights, subscription rights,
conversion rights, exchange rights or other contracts or commitments that could
require the Company to issue, sell or otherwise cause to become outstanding any
of its capital stock. There are no outstanding or authorized stock appreciation,
phantom stock, profit participation or similar rights with respect to the
Company. Except as set forth in the SEC Documents and for customary proxies to
be solicited by the Board of Directors with respect to the Company's 2003 Annual
Meeting of Stockholders, there are no voting trusts, proxies or other agreements
or understandings with respect to the voting of the capital stock of the
Company.
3.5 Noncontravention. Neither the execution nor the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby, will
(i) violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge or other restriction of any government,
governmental agency or court to which the Company is subject or any provision of
the charter or bylaws of the Company or (ii) conflict with, result in a breach
of, constitute a default under, result in the acceleration of, create in any
party the right to accelerate, terminate, modify or cancel, or require any
notice under any agreement, contract, lease, license, instrument, or other
arrangement to which the Company is a party or by which the Company is bound or
to which any of the Company's assets is subject (or result in the imposition of
any mortgage, pledge, lien, encumbrance, charge or other security interest upon
any of such assets), except in either case, where such violation, conflict or
default would not have a material adverse
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effect on the business, financial condition, operations or results of operations
of the Company. Except for (i) the filing of a Form D with the Securities and
Exchange Commission (the "SEC") and (ii) filings which may be required under
state securities laws, the Company does not need to give any notice to, make any
filing with, or obtain any authorization, consent or approval of any government
or governmental agency in order for the Parties to consummate the transactions
contemplated by this Agreement.
3.6 Reports Filed Under the Securities Exchange Act of 1934;
Financial Statements. All periodic reports filed by the Company under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), in the preceding
twelve (12) months (the "SEC Documents") contain all statements required to be
stated therein in accordance with the 1934 Act and do not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading.
Except as set forth on the Schedule of Exceptions hereto, (a) as of their
respective dates (except as they have been correctly amended), the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto, and (b) such financial
statements have been prepared in accordance with generally accepted accounting
principles, consistently applied, during the periods involved (except (i) as may
be otherwise indicated in such financial statements or the notes thereto or (ii)
in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present the
financial position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments).
3.7 Absence of Certain Changes. Except as disclosed in the SEC
Documents or otherwise disclosed in public announcements or press releases,
since the filing of the most recent SEC Document, there has been no change to
the business, properties, assets, operations, prospects, results of operations
or condition (financial or otherwise) of the Company, except for such changes
which could not be reasonably expected to have a material adverse effect on the
business, financial condition, operations or results of operations of the
Company.
4. REPRESENTATIONS AND WARRANTIES OF THE INVESTORS. Each Investor
represents and warrants to the Company that the statements in the following
paragraphs of this Section 4 are true and correct with respect to such Investor:
4.1 Organization and Qualification. If such Investor is an entity,
it is a corporation, limited liability company, trust or partnership or other
similar entity duly organized, validly existing and in good standing under the
laws of its jurisdiction. If such Investor is an individual, such Investor has
the legal capacity to enter into this Agreement and is a bona fide resident of
the state shown in the address set forth on the applicable signature page to
this Agreement. Such Investor has all requisite power and authority (corporate
or otherwise) to enter into and perform this Agreement and to carry out the
transactions contemplated by this Agreement.
4.2 Authorization. All action on the part of such Investor necessary
for the authorization, execution and delivery of this Agreement and the
performance of all obligations of
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such Investor hereunder has been taken, and this Agreement has been duly
executed and delivered by such Investor and constitutes a valid and legally
binding obligation of such Investor, enforceable in accordance with its terms,
except as may be limited by (i) applicable bankruptcy, insolvency,
reorganization or other laws of general application relating to or affecting the
enforcement of creditors' rights generally, (ii) the effect of rules of law
governing the availability of equitable remedies, and (iii) the unenforceability
under certain circumstances under law or court decisions of provisions providing
for the indemnification of or contribution to a party with respect to a
liability where such indemnification or contribution is contrary to public
policy or prohibited by law.
4.3 Purchase for Own Account. The Shares to be purchased by such
Investor hereunder will be acquired for investment for such Investor's own
account, not as a nominee or agent, and not with a view to the public
distribution thereof within the meaning of the Securities Act of 1933, as
amended (the "1933 Act"), and such Investor has no present intention of selling
or otherwise distributing the same, except in compliance with the requirements
of, or pursuant to a valid exemption from, the 1933 Act. Such Investor does not
have any contract, undertaking, agreement or arrangement with any person to
sell, transfer or grant participations to such person or to any third person,
with respect to the Shares. To the extent such Investor is not an individual,
such Investor also represents that he, she or it has not been formed for the
specific purpose of acquiring Shares.
4.4 Accredited Investor Status. Such Investor is an "accredited
investor" within the meaning of Regulation D promulgated under the 1933 Act. By
reason of its business and financial experience, sophistication and knowledge,
such Investor is capable of evaluating the risks and merits of the investment
made pursuant to this Agreement. Such Investor confirms that he, she or it (a)
has preexisting personal or business relationships, with the Company or any of
its officers, directors or controlling persons and (b) is able (i) to bear the
economic risk of this investment, as well as other risk factors as more fully
set forth herein and in the SEC Documents, (ii) to hold the Shares for an
indefinite period of time, and (iii) to bear a complete loss of such Investor's
investment; and such Investor represents that he, she or it has sufficient
liquid assets so that the illiquidity associated with this investment will not
cause any undue financial difficulties or affect such Investor's ability to
provide for its current needs and possible financial contingencies.
4.5 Restricted Securities. Such Investor understands that the Shares
are characterized as "restricted securities" under the 1933 Act inasmuch as they
are being acquired from the Company in a transaction not involving a public
offering and that under the 1933 Act and applicable regulations thereunder such
securities may be resold without registration under the 1933 Act only in certain
limited circumstances. In this connection, such Investor represents that he, she
or it is familiar with Rule 144 under the 1933 Act, as presently in effect, and
understands the resale limitations imposed thereby and by the 1933 Act. Such
Investor understands that the Company is under no obligation to register any of
the securities sold hereunder except as provided in Section 8 hereof.
4.6 Due Diligence. Such Investor has had a reasonable opportunity to
conduct due diligence and to ask questions of and receive answers from the
Company and its officers, and all such questions have been answered to the full
satisfaction of such Investor. Such
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Investor acknowledges that he, she or it has read carefully, and is fully
familiar with, the Company's Annual Report on Form 10-K for the year ended
December 31, 2003, including, without limitation, the information set forth
under the heading "Risks and Uncertainties" in "Item 1 - Business" of such
report.
4.7 No General Solicitation. Such Investor did not (i) receive,
review or rely upon any advertisement, article, notice or other communication
published in a newspaper or magazine or similar media or broadcast over
television or radio, whether closed circuit, or generally available, with
respect to the Shares or (ii) attend any seminar, meeting or investor or other
conference whose attendees were, to such Investor's knowledge, invited by any
general solicitation or general advertising with respect to the Shares.
4.8 Further Limitations on Disposition. Without in any way limiting
the representations set forth above, such Investor further agrees not to make
any disposition of all or any portion of the Shares unless and until:
(a) there is then in effect a registration statement under the
1933 Act covering such proposed disposition and such disposition is made in
accordance with such registration statement; or
(b) (i) such Investor shall have notified the Company of the
proposed disposition and shall have furnished the Company with a statement of
the circumstances surrounding the proposed disposition, and (ii) such Investor
shall have furnished the Company at such Investor's expense an opinion of
counsel, reasonably satisfactory to the Company that such disposition will not
require registration of such securities under the 1933 Act; provided that the
Company shall not require an opinion of counsel for routine sales of shares
pursuant to Rule 144.
4.9 Legends. It is understood that the certificates evidencing the
Shares will bear the legends set forth below:
(a) THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE
SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS
ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM.
(b) Any legend required by the laws of the State of
California, including any legend required by the California Department of
Corporations.
5. PRE-CLOSING COVENANTS OF THE PARTIES.
The Parties agree as follows with respect to the period between the
execution of this Agreement and the Closing:
5.1 General. Each of the Parties will use its reasonable best
efforts to take all action and to do all things necessary, proper or advisable
in order to consummate and make
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effective the transactions contemplated by this Agreement (including
satisfaction, but not waiver, of the closing conditions set forth in Sections 6
and 7 below).
5.2 Notice of Developments. Each Party will give prompt written
notice to the other of any material adverse development causing a breach of any
of its own representations and warranties in Section 3 or 4 above. No disclosure
by any Party pursuant to this Section 5.2, however, shall be deemed to cure any
misrepresentation, breach of warranty or breach of covenant.
6. CONDITIONS TO THE INVESTORS' OBLIGATIONS AT CLOSING. The obligations of
the Investors under Sections 1 and 2 of this Agreement with respect to the
Closing are subject to the fulfillment or waiver, on or before the Closing Date,
of each of the following conditions:
6.1 Representations and Warranties True. The representations and
warranties of the Company contained in Section 3 shall be true and correct in
all material respects on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of the
Closing Date.
6.2 Compliance with Covenants. The Company shall have performed and
complied with all of its covenants hereunder in all material respects through
the Closing Date.
6.3 Restructuring. The closing of the transactions contemplated by
the Restructuring shall have occurred in a manner satisfactory to the Majority
in Interest of the Investors.
6.4 No Litigation. No action, suit or proceeding shall be pending or
threatened before any court or quasi-judicial or administrative agency of any
federal, state, local or foreign jurisdiction or before any arbitrator wherein
an unfavorable injunction, judgment, order, decree, ruling or charge would (A)
prevent consummation of any of the transactions contemplated by this Agreement,
(B) cause any of the transactions contemplated by this Agreement to be rescinded
following consummation (and no such injunction, judgment, order, decree, ruling
or charge shall be in effect), or (C) affect adversely the right of the
Investors to own the Shares.
6.5 Securities Exemptions. The offer and sale of the Shares to the
Investors pursuant to this Agreement shall be exempt from the registration
requirements of the 1933 Act, the qualifications requirement of the California
Corporate Securities Law of 1968 (the "Law") and the registration and/or
qualification requirements of all other applicable state securities laws.
7. CONDITIONS TO THE COMPANY'S OBLIGATIONS AT CLOSING. The obligations of
the Company to the Investors under this Agreement with respect to the Closing
are subject to the fulfillment or waiver on or before the Closing Date of each
of the following conditions:
7.1 Representations and Warranties. The representations and
warranties of the Investors contained in Section 4 shall be true and correct in
all material respects on the Closing
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Date with the same effect as though such representations and warranties had been
made on and as of the Closing Date.
7.2 Payment of Consideration. The Investors shall have delivered to
the Company by wire transfer the purchase price for the Shares in accordance
with the provisions of Section 2.
7.3 Restructuring. The closing of the transactions contemplated by
the Restructuring shall have occurred in a manner satisfactory to the Company.
7.4 No Litigation. No action, suit or proceeding shall be pending or
threatened before any court or quasi-judicial or administrative agency of any
federal, state, local or foreign jurisdiction or before any arbitrator wherein
an unfavorable injunction, judgment, order, decree, ruling or charge would (A)
prevent consummation of any of the transactions contemplated by this Agreement,
(B) cause any of the transactions contemplated by this Agreement to be rescinded
following consummation (and no such injunction, judgment, order, decree, ruling
or charge shall be in effect), or (C) affect adversely the right of the
Investors to own the Shares.
7.5 Securities Exemptions. The offer and sale of the Shares to the
Investors pursuant to this Agreement shall be exempt from the registration
requirements of the 1933 Act, the qualifications requirements of the Law and the
registration and/or qualification requirements of all other applicable state
securities laws.
8. REGISTRATION STATEMENT FOR RESALE OF THE SHARES.
8.1 Shelf Registration Statement. As promptly as practicable subject
to the Company's need to obtain and file acquired business financial statements
described on the Schedule of Exceptions attached hereto, the Company will
prepare and file with the SEC a registration statement under the 1933 Act
registering the Shares for resale to the public by the Investors, pursuant to
such registration statement and the prospectus included therein (the
"Registration Statement") free and clear of any restrictions under the 1933 Act
except for prospectus delivery requirements. The Company shall use its
commercially reasonable efforts to cause such Registration Statement to become
effective as promptly as practicable thereafter and, subject to Section 8.2(b)
below, to remain effective until the earlier of (i) two (2) years from the
Closing Date and (ii) with respect to each Investor, the time that such Investor
may freely sell the Shares held by he, she or it without registration and
without regard to volume or manner of sale (the "Registration Period").
8.2 Company Obligations. From time to time during the period
commencing upon the effectiveness of the Registration Statement and ending upon
the earlier of (x) such time as the applicable Investor may freely sell the
Shares held by such Investor without registration and without regard to volume
or manner of sale, or (y) such time as the applicable Investor shall have
advised the Company in writing that such Investor has completed the resale of
the Shares held by such Investor (the "Resale Period"), the Company shall do the
following:
(a) Prepare and deliver to the Investors as many copies of the
Prospectus (as hereafter defined) as the Investors may reasonably request;
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(b) Use its reasonable efforts to comply with all requirements
imposed upon it by the 1933 Act, by the 1934 Act and by the undertakings in the
Registration Statement so far as is necessary to permit the continuance of
resales of the Shares by the Investors to the public, free and clear of any
restrictions under the 1933 Act except for prospectus delivery requirements. If,
at any time during the Resale Period, an event shall occur which makes it
necessary to amend or supplement the Registration Statement or the Prospectus to
comply with law or with the rules and regulations of the SEC, the Company shall
promptly notify the Investors of the proposed amendment or supplement and
promptly prepare and furnish to the Investors such number of copies of an
amended or supplemented Registration Statement or Prospectus that complies with
law and with such rules and regulations as the Investors may reasonably request.
Each Investor shall suspend its sales of the Shares pending the preparation and
delivery of such amendment or supplement and until such time as each such
amendment or amendments to the Registration Statement have been declared
effective by the SEC. For purposes of this Agreement, the term "Prospectus"
means the final prospectus relating to the Shares most recently included in the
Registration Statement or filed by the Company pursuant to Rule 424 of the 1933
Act and any amendments or supplements thereto filed by the Company pursuant to
Rule 424 of the 1933 Act and shall include all documents or information
incorporated in any such prospectus by reference;
(c) Promptly advise the Investors (i) when any post-effective
amendment of the Registration Statement is filed with the SEC and when any
post-effective amendment becomes effective; (ii) of any request made by the SEC
for any amendment of or supplement to the Registration Statement or the
Prospectus or for additional information relating thereto; (iii) when any facts
or events occur which, individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration Statement; (iv) of any
suspension or threatened suspension of the use of any Prospectus in any state;
and (v) of any proceedings commenced or threatened to be commenced by the SEC or
any state securities commission that would result in the issuance of any stop
order or other order or suspension of use. The Company agrees to use its
reasonable efforts to prevent or promptly remove any stop order or other order
preventing or suspending the use of the Prospectus during the Resale Period and
to comply with any such request by the SEC to amend or supplement the
Prospectus; and
(d) Take such action as shall be necessary to qualify and
maintain the qualification of the Shares covered by such registration under such
state securities or "blue sky" laws for offers and sales to the public during
the Resale Period as the Investors shall reasonably request; provided, however,
that the Company shall not be obligated to qualify as a foreign corporation to
do business under the laws of or become subject to taxation in, any jurisdiction
in which it shall not be then qualified, or to file any general consent to
service of process.
8.3 Restrictions on Registrations. If at any time or from time to
time after the effective date of the Registration Statement, the Company
notifies the Investors in writing of the existence of a Potential Material Event
(as defined below), no Investor shall offer or sell any Shares or engage in any
other transaction involving or relating to Shares, from the time of the giving
of notice with respect to a Potential Material Event until such Investor
receives written notice from the Company that such Potential Material Event
either has been disclosed to the public or no longer constitutes a Potential
Material Event. If a Potential Material Event shall occur prior to the date the
Registration Statement is filed, then notwithstanding Section 8.1
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above, the Company's obligation to file the Registration Statement shall be
delayed without penalty until such Potential Material Event either has been
disclosed to the public or no longer constitutes a Potential Material Event.
"Potential Material Event" means any of the following: (i) the possession by the
Company of material information not ripe for disclosure in a registration
statement, as determined in good faith by the Chief Executive Officer or the
Board of Directors of the Company that disclosure of such information in a
Registration Statement would be detrimental to the business and affairs of the
Company; or (ii) any material engagement or activity by the Company which would,
in the good faith determination of the Chief Executive Officer or the Board of
Directors of the Company, be adversely affected by disclosure in a registration
statement at such time, which determination shall be accompanied by a good faith
determination by the Chief Executive Officer or the Board of Directors of the
Company that the applicable Registration Statement would be materially
misleading absent the inclusion of such information. In no event shall the
suspension of the Registration Statement (or the permissible delay in filing a
Registration Statement) exceed 90 days as a result of a Potential Material
Event.
8.4 Certain Obligations of the Investors. In connection with the
registration of the Shares pursuant to this Section 8:
(a) Each Investor shall cooperate as reasonably requested by
the Company with the Company in connection with the preparation of the
Registration Statement, and for so long as the Company is obligated to file and
keep effective the Registration Statement, shall provide to the Company, in
writing, for use in the Registration Statement, all such information regarding
such Investor and its plan of distribution of the Shares as may be reasonably
necessary to enable the Company to prepare the Registration Statement and the
Prospectus, to maintain the currency and effectiveness thereof and otherwise to
comply with all applicable requirements of law in connection therewith.
(b) Each Investor agrees to promptly furnish additional
information required to be disclosed in order to make the information previously
furnished to the Company by such Investor not materially misleading. Each
Investor agrees to furnish all such information and to cooperate with and
provide assistance to the Company, as the Company may reasonably request, in
connection with any registration and sale of the Shares.
(c) Each Investor hereby covenants with the Company not to
make any sale of the Shares without effectively causing the prospectus delivery
requirements under the 1933 Act to be satisfied unless the sale is made pursuant
to an exemption from registration.
(d) Each Investor acknowledges and agrees that the Shares sold
pursuant to the Registration Statement are not transferable on the books of the
Company unless the stock certificate submitted to the transfer agent evidencing
the Shares is accompanied by a certificate reasonably satisfactory to the
Company to the effect that (i) the Shares have been sold in accordance with this
Agreement and the Registration Statement and (ii) the requirement of delivering
a current prospectus has been satisfied.
(e) Each Investor is hereby advised that the anti-manipulation
provisions of Regulation M under the 1934 Act may apply to sales of the Shares
offered pursuant to the Registration Statement and agrees not to take any action
with respect to any distribution
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deemed to be made pursuant to the Registration Statement that constitutes a
violation of Regulation M under the 1934 Act or any other applicable rule,
regulation or law.
(f) At the end of the Registration Period, each Investor shall
discontinue sales of Shares pursuant to the Shelf Registration Statement upon
receipt of notice from the Company of its intention to remove from registration
the Shares covered thereby which remain unsold, and each Investor shall promptly
notify the Company of the number of Shares registered that remain unsold
immediately upon receipt of the notice from the Company.
8.5 Indemnification of the Investors. The Company shall indemnify,
defend and hold harmless each Investor, its officers and its directors and any
controlling persons of such Investor against and in respect of any losses,
claims, damages or liabilities, joint or several (including legal or other fees
and expenses reasonably incurred by any of them in connection with investigating
or defending any such loss, claim, damage or liability) to which such Investor
or any such persons may become subject under the 1933 Act or otherwise insofar
as such losses, claims, damages or liabilities (or actions with respect thereto)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except to the extent that any such untrue statement or omission is
based upon written information supplied by such Investor or by any of its
representatives for use in such Registration Statement; provided, however, this
indemnity agreement shall not inure to the benefit of any Investor on account of
any loss, claim, damage, liability or action arising from the sale of the Shares
to any person if any Investor fails to send or give a copy of the Prospectus (as
amended or supplemented) to such person.
8.6 Indemnification of the Company. Each Investor shall indemnify,
defend and hold harmless the Company, its officers and its directors and any
controlling persons of the Company against and in respect of any losses, claims,
damages or liabilities, joint or several (including legal or other fees and
expenses reasonably incurred by any of them in connection with investigating or
defending any such loss, claim, damage or liability) to which the Company or any
such persons may become subject under the 1933 Act or otherwise insofar as such
losses, claims, damages or liabilities (or actions with respect thereto) arise
out of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only in each case to the extent that any such untrue statement
or omission is based upon written information supplied by such Investor or its
representatives for use in such Registration Statement; provided that in no
event shall any indemnification obligation on the part of any Investor under
this Section 8.6 exceed the net proceeds from the offering received by the
Investor.
8.7 Contribution. If for any reason the indemnification provided for
in the preceding Sections 8.5 or 8.6 is unavailable to an indemnified party as
contemplated by such clauses, then the indemnifying party shall contribute to
the amount paid or payable by the indemnified party as a result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect not
only the relative benefits received by the indemnified party and the
11
indemnifying party, but also the relative fault of the indemnified party and the
indemnifying party, as well as any other relevant equitable considerations;
provided that in no event shall any contribution obligation on the part of any
Investor under this Section 8.8 exceed the net proceeds from the offering
received by such Investor.
8.8 Procedure for Indemnification. The procedure for indemnification
under this Section 8 shall be as follows:
(a) Notice. The indemnified party shall promptly give notice
to the indemnifying party of any pending or threatened claim giving rise to
indemnification under Section 8.5 or 8.6 (a "Claim"), specifying the factual
basis for the Claim and the approximate amount thereof.
(b) Control of Claim and Settlement. With respect to any Claim
as to which a person is entitled to indemnification hereunder, the indemnifying
party shall have the right at its own expense to participate in or assume
control of the defense of the Claim, and the indemnified party shall cooperate
fully with the indemnifying party, subject to reimbursement for actual
out-of-pocket expenses incurred by the indemnified party as the result of a
request by the indemnifying party. If the indemnifying party elects to assume
control of the defense of any Claim, the indemnified party shall have the right
to participate in the defense of the Claim at its own expense. If the
indemnifying party does not elect to assume control or otherwise participate in
the defense of any Claim, he, she or it shall be bound by the results obtained
by the indemnified party with respect to the Claim. No indemnifying party shall
be liable for any settlement effected without its written consent, not to be
unreasonably withheld or delayed.
(c) Survival. Notwithstanding any other provision of this
Agreement, the indemnification and contribution obligations of the parties
hereunder shall survive indefinitely.
(d) Expenses. The Company shall pay all expenses incident to
the registration of the Shares under this Section 8, including without
limitation, all registration and filing fees, all fees and expenses of complying
with securities or blue sky laws, all word processing, duplicating and printing
expenses, and the fees and disbursements of counsel for the Company and its
independent public accountants. With respect to sales of the Shares, each
Investor shall pay all underwriting discounts and commissions and fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals relating to the distribution of the Shares to be sold by such
Investor, the fees and disbursements of counsel retained by such Investor and
transfer taxes, if any.
(e) Assignment of Registration Rights. The rights to cause the
Company to register Shares set forth in this Section 8 may be assigned in whole
or in part by an Investor; provided that: (a) the transfer may otherwise be
effected in accordance with applicable securities laws, (b) the transfer
involves not less than the lesser of all of such Investor's shares or 100,000
shares of Common Stock, (c) such Investor gives prior written notice to the
Company, and (d) the transferee agrees to comply with the terms and provisions
of this Agreement in a written instrument satisfactory in form and substance to
the Company and its counsel. Except as specifically permitted by this Section
8.8(e), the rights of an Investor with respect to the
12
registration of such Investor's Shares will not be transferable to any other
person or entity, and any attempted transfer will cause all rights of such
Investor therein to be forfeited, void ab initio and of no further force and
effect.
8.9 Waiver. With the written consent of the Company and a Majority
in Interest of the Investors , any provision of this Section 8 may be waived
(either generally or in a particular instance, either retroactively or
prospectively and either for a specified period of time or indefinitely) or
amended. Upon the effectuation of each waiver or amendment, the Company will
promptly give written notice thereof to the Investors, if any, who have not
previously received notice thereof or consented thereto in writing.
8.10 Compliance.
(a) Each Investor will observe and comply with the 1933 Act,
the 1934 Act and the general rules and regulations thereunder, as now in effect
and as from time to time amended and including those hereafter enacted or
promulgated, in connection with any offer, sale, pledge, transfer or other
disposition of the Shares or any part thereof.
(b) With a view to making available to the Investors the
benefits of certain rules and regulations of the SEC that at any time permit the
sale of the Shares to the public without registration, the Company agrees to:
i. make and keep public information available, as those
terms are understood and defined in Rule 144 under the 1933 Act;
ii. with the SEC in a timely manner all reports and
other documents required of the Company under the 1934 Act; and
iii. so long as an Investor owns any unregistered
Shares, furnish to such Investor upon any reasonable request a written statement
by the Company as to its compliance with the public information requirements of
Rule 144 under the 1933 Act, and of the 1934 Act, a copy of the most recent
annual or quarterly report of the Company, and the other SEC reports and
documents of the Company as such Investor may reasonably request in availing
itself of any rule or regulation of the SEC allowing such Investor to sell any
Shares without registration (excluding any reports or documents of the Company
that the Company, in its sole discretion, deems confidential).
9. TERMINATION.
9.1 Termination. This Agreement may be terminated at any time prior
to the Closing:
(a) by mutual written agreement of the Company and a Majority
in Interest of the Investors;
(b) by either a Majority in Interest of the Investors or the
Company (provided that the terminating party is not then in material breach of
any representation,
13
warranty, covenant or other agreement contained in this Agreement) if the
Closing shall not have been consummated on or before May 30, 2002;
(c) by either a Majority in Interest of the Investors or the
Company if a court of competent jurisdiction or governmental, regulatory or
administrative agency or commission shall have issued a non-appealable final
order, decree or ruling or taken any other action having the effect of
permanently restraining, enjoining or otherwise prohibiting the transactions
contemplated by this Agreement; or
(d) by either a Majority in Interest of the Investors or the
Company (provided that the terminating party is not then in material breach of
any representation, warranty, covenant or other agreement contained in this
Agreement) in the event of a material breach by the other party of any
representation or warranty contained in this Agreement which cannot be or has
not been cured within 30 days after the giving of written notice to the
breaching party of such breach.
9.2 Effect of Termination. In the event of the termination of this
Agreement pursuant to Section 9.1, this Agreement shall forthwith become void
and there shall be no liability on the part of any Party hereto (or any
stockholder, director, officer, partner, employee, agent, consultant or
representative of such Party) except as set forth in this Section 9.2, provided
that nothing contained in this Agreement shall relieve any party from liability
for any breach of this Agreement and provided further that Section 10 shall
survive termination of this Agreement.
10. MISCELLANEOUS.
10.1 Survival of Warranties. The representations, warranties and
covenants of the Company and the Investors contained in or made pursuant to this
Agreement shall survive the execution and delivery of this Agreement and the
Closing for a period of twelve (12) months from the Closing Date and shall in no
way be affected by any investigation of the subject matter thereof made by or on
behalf of the Investors or the Company, as the case may be.
10.2 Successors and Assigns. This Agreement shall bind and inure to
the benefit of the Company and the Investors and their successors, permitted
assigns, heirs and personal representatives; provided that the Investors may not
assign their rights or obligations under this Agreement to any person without
the prior written consent of the Company.
10.3 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW
OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
10.4 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.5 Headings. The headings and captions used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement. All references in this Agreement to sections,
paragraphs, exhibits and schedules shall, unless
14
otherwise provided, refer to sections and paragraphs hereof and exhibits and
schedules attached hereto, all of which exhibits and schedules are incorporated
herein by this reference.
10.6 Notices. All notices, requests, demands, claims and other
communications hereunder will be in writing. Any notice, request, demand, claim
or other communication hereunder shall be deemed duly given if (and then two
business days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid and addressed to the intended recipient as set forth
below:
To the Company: Women First HealthCare, Inc.
00000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to: Xxxxxx & Xxxxxxx
00000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To each Investor: The address set forth on the signature page hereto.
Any Party may send any notice, request, demand, claim or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service
or ordinary mail), but no such notice, request, demand, claim or other
communication shall be deemed to have been duly given unless and until it
actually is received by the intended recipient. Any Party may change the address
to which notices, requests, demands, claims and other communications hereunder
are to be delivered by giving the other Parties notice in the manner herein set
forth.
10.7 No Finder's Fees. The Company, on the one hand, and each
Investor, on the other hand, represent to one another that he, she or it neither
is nor will be obligated for any finder's or broker's fee or commission in
connection with this transaction. The Company agrees to indemnify and hold
harmless the Investors from any liability for any commission or compensation in
the nature of a finder's or broker's fee (and any asserted liability) for which
the Company or any of its officers, employees or representatives is responsible.
10.8 Amendments and Waivers. Subject to Section 8.9, any term of
this Agreement may be amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the Investors. A "Majority in Interest" of the Investors shall mean (a)
prior to the Closing, a majority in interest based upon the relative percentage
of the aggregate purchase amount to be paid by all Investors as set forth on the
Schedule of Investors and (b) from and after the Closing, a majority in interest
based on the number of Shares
15
then held by all Investors and any successors, assigns or transferees who have
become a party to this Agreement pursuant to Section 8.8(e).
10.9 Attorneys' Fees. If any action at law or in equity is necessary
to enforce or interpret the terms of this Agreement, the prevailing party shall
be entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
10.10 Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision(s) shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision(s) were so excluded and shall be enforceable in
accordance with its terms.
10.11 Entire Agreement. This Agreement, together with all exhibits
and schedules hereto, constitutes the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersedes any and all
prior negotiations, correspondence, agreements, understandings duties or
obligations between the parties with respect to the subject matter hereof.
10.12 Further Assurances. From and after the date of this Agreement,
upon the request of the Investors or the Company, the Company and the Investors
shall execute and deliver such instruments, documents or other writings as may
be reasonably necessary or desirable to confirm and carry out and to effectuate
fully the intent and purposes of this Agreement.
10.13 WAIVER OF JURY TRIAL. THE COMPANY AND THE INVESTORS HEREBY
WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION,
PROCEEDING OR LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT.
10.14 CALIFORNIA CORPORATE SECURITIES LAW. THE SALE OF THE
SECURITIES WHICH ARE THE SUBJECT OF THE AGREEMENT HAS NOT BEEN QUALIFIED WITH
THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF
SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION
THEREFOR PRIOR TO SUCH QUALIFICATION OR IN THE ABSENCE OF AN EXEMPTION FROM SUCH
QUALIFICATION IS UNLAWFUL. PRIOR TO ACCEPTANCE OF SUCH CONSIDERATION BY THE
COMPANY, THE RIGHTS OF ALL PARTIES TO THE AGREEMENT ARE EXPRESSLY CONDITIONED
UPON SUCH QUALIFICATION BEING OBTAINED OR AN EXEMPTION FROM SUCH QUALIFICATION
BEING AVAILABLE.
16
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
THE COMPANY:
WOMEN FIRST HEALTHCARE, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President, Chief Financial Officer, Treasurer and Secretary
INVESTORS:
/s/ Xxxxxx X. Xxxxxx
----------------------------------------------------------
Xxxxxx X. Xxxxxx
Address: c/o Women First Healthcare, Inc.
00000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
/s/ Xxxxxxx X. Xxxxxxxxx
----------------------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Address: 00 Xxxxxxxxxxx Xxxxx
Xxxxxxxxxxxxx, XX 00000
Galleon Captain's Offshore, Ltd.
By: /s/ Illegible
-----------------------------------------------------
Address: c/o Galleon Management, LP
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxx
Galleon Captain's Partners, L.P
By: /s/ Illegible
-----------------------------------------------------
Address: c/o Galleon Management, LP
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxx
SIGNATURE PAGE TO COMMON STOCK PURCHASE AGREEMENT
/s/ Xxxx X. Xxxxxxxxx
----------------------------------------------------------
Xxxx X. Xxxxxxxxx
Address: c/o Allen & Co. LLC
000 Xxxxx Xxx.
Xxx Xxxx, XX 00000
/s/ Xxxxx X. Xxxxxxxx
----------------------------------------------------------
Xxxxx X. Xxxxxxxx
Address: c/o Agger Capital Management LLC
0000 Xxxx Xxxxxxxxx Xxxxxx, # 000
Xxxxxxxxx, XX 8011
/s/ Xxxxx X. Xxxxxx
----------------------------------------------------------
Xxxxx X. Xxxxxx
Address: c/o O.S.S. Capital Management LP
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
/s/ Xxxx Xxxxxxxx
----------------------------------------------------------
Xxxx Xxxxxxxx
Address: 000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxxx, XX 00000
/s/ Xxxxxxx X. Xxxxx
----------------------------------------------------------
Xxxxxxx X. Xxxxx
Address: 00 Xxx Xxxxxxxx
Xxxxxxxx, XX 00000
SIGNATURE PAGE TO COMMON STOCK PURCHASE AGREEMENT
