Exhibit 99.3
WAIVER AGREEMENT
THIS WAIVER AGREEMENT (this "Agreement") is made as of August 30, 2002 by
and among Cohesion Technologies, Inc., a Delaware corporation (the "Company"),
and the undersigned Persons, each of which is herein referred to as an
"Investor" and all of which are collectively referred to herein as the
"Investors." Capitalized terms used herein without definition have the meanings
given to them in the Purchase Agreement (as defined below).
RECITALS
WHEREAS, the Company and the Investors have entered into a Common Stock
Purchase Agreement, dated as of July 24, 2002 (the "Purchase Agreement"),
pursuant to which, among other things, the Company has agreed to issue and sell
to the Investors, and the Investors have agreed to purchase from the Company,
shares of the Company's common stock, par value $0.001 per share (the "Common
Stock"), upon the terms and subject to the conditions set forth in the Purchase
Agreement.
WHEREAS, pursuant to Section 6.4 of the Purchase Agreement the Company has
agreed not to solicit, encourage or entertain proposals from or enter into
negotiations with or furnish any nonpublic information to any other Person
regarding the possible sale of any interest in the Company's stock or a change
of control of the Company.
WHEREAS, the Company has received an unsolicited written proposal from a
third Person with regard to a potential change of control transaction involving
the Company, a copy of which proposal has been provided to the Investors.
WHEREAS, the Investors are willing to grant a limited waiver of their
rights under Sections 6.1, 6.3, 6.4 and 6.7 of the Purchase Agreement with
respect to the Company negotiating with, providing information to, approving and
entering into any contract with or recommending to stockholders of the Company
any transaction with third Persons.
WHEREAS, in consideration of that limited waiver, the Company has agreed
to pay a waiver fee to, and to reimburse certain expenses of, the Investors as
provided for herein.
AGREEMENT
NOW, THEREFORE, in consideration of good and valuable consideration the
receipt and adequacy of which is hereby acknowledged, the undersigned, intending
to be legally bound, hereby agree as follows:
1. Waiver. For a period commencing on the date hereof and ending at 5:00
p.m., California time, on September 27, 2002 (the "Waiver Period"), the
Investors hereby waive the provisions of, and the rights they may have under,
Sections 6.1, 6.3, 6.4 and 6.7 of the Purchase Agreement with respect to the
Company (and its directors, officers, employees, agents and representatives)
negotiating with, providing information to, approving and entering into any
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
contract with or recommending to stockholders of the Company any transaction
with [***] ("[***]") or any other steps or conduct taken in connection
therewith. In the event that, as a result of the Company's contact with [***],
the Company's Board of Directors determines in good faith, after consultation
with its legal counsel, that contact with the Persons set forth on Exhibit A
hereto (together with [***], each a "Potential Acquiror") is required in order
for the Company's Board of Directors to comply with its fiduciary duties under
applicable law, (a) the Company shall give written notice of such determination
to the Investors and (b) during the Waiver Period, the Investors hereby waive
the provisions of, and the rights they may have under, Sections 6.1, 6.3, 6.4
and 6.7 of the Purchase Agreement with respect to the Company (and its
directors, officers, employees, agents and representatives) negotiating with,
providing information to, approving and entering into any contract with or
recommending to stockholders of the Company any transaction with any Potential
Acquiror or any other steps or conduct taken in connection therewith. The
Company shall give the Investors prompt written notice of (a) the identity of
each Potential Acquiror with which it negotiates or to which it provides
information and (b) all of the material terms and conditions of any proposal,
oral or written, with respect to an Alternative Transaction submitted to the
Company by a Potential Acquiror. For purposes of this Agreement, an "Alternative
Transaction" means (i) a transaction involving the sale by the Company of an
interest in the Company's capital stock to any Person other than the Investors
greater than the Applicable Percentage, (ii) an acquisition of a majority of the
Company's outstanding Common Stock, (iii) a merger, consolidation or other
business combination involving the Company in which the stockholders of the
Company immediately prior to such transaction do not own at least a majority of
the equity interests of the surviving entity immediately after the completion of
such transaction or (iv) the sale of all or substantially all of the Company's
assets. For purposes of this Agreement, the "Applicable Percentage" means (x)
10% from the date hereof through and including the date of the Stockholder
Meeting and (y) 20% thereafter.
2. Waiver Payments. In consideration of the waiver provided for in
Paragraph 1, the Company agrees to pay the Investors (a) an amount of cash equal
to $1,000,000 (the "Waiver Fee") and (b) reimbursement of reasonable documented
out-of-pocket fees and expenses (including attorneys' fees) not exceeding an
aggregate of $10,000 incurred by the Investors in connection with the
negotiation, execution and delivery of this Agreement (the "Waiver Expenses"
and, together with the Waiver Fee, the "Waiver Payments"), in each case payable
in accordance with the provisions of this Paragraph 2. The Waiver Payments shall
be due and payable upon the earliest to occur of the following: (a) the
termination of the Purchase Agreement by the Investors pursuant to Section
7.1(c) of the Purchase Agreement followed by the completion of an Alternative
Transaction within three months after the date of such termination; (b) the
termination of the Purchase Agreement by the Investors pursuant to Section
7.1(d) of the Purchase Agreement; (c) immediately prior to the completion of an
Alternative Transaction; and (d) immediately prior to the execution by the
Company of a definitive agreement with respect to an Alternative Transaction
(each of the events listed in subparagraphs (a) through (d) is referred to
herein as a "Trigger Event"); provided, however, in the event that the sale of
Common Stock to the Investors pursuant to the Purchase Agreement is completed
prior to the occurrence of any Trigger Event, then the Company's obligation to
pay the Waiver Payments shall be extinguished. Any Waiver Fee shall be allocated
among the Investors based
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
on the relative number of shares of Common Stock to be purchased by each
Investor pursuant to the Purchase Agreement.
3. Effect on Purchase Agreement. Except as set forth in Section 1 above,
the provisions of the Purchase Agreement, including Section 6.4 thereof, shall
remain in full force and effect, provided that the Purchase Agreement shall
automatically terminate immediately upon the occurrence of any Trigger Event
(provided that the Company shall have paid in full any Waiver Payment due under
Section 2 hereof).
4. No Admission. Nothing contained in this Waiver Agreement shall be
construed as an admission of any party hereto as to the proper interpretation
of, or the enforceability of, any provision of the Purchase Agreement.
5. Termination. This Waiver Agreement shall automatically terminate on,
and be of no further force and effect after, the earliest to occur of the
following: (a) the 12-month anniversary of the date hereof; (b) the completion
of the sale of Common Stock to the Investors pursuant to the Purchase Agreement;
and (c) the occurrence of any Trigger Event (provided that the Company shall
have paid in full any Waiver Payment due under Section 2 hereof).
6. Miscellaneous.
A. Governing Law. This Agreement shall be governed in all respects
by the laws of the State of California without regard to choice of laws or
conflict of laws provisions thereof.
B. Successors and Assigns. This Agreement and the rights and
obligations of the parties hereunder shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties hereto.
C. Entire Agreement; Amendment. This Agreement constitutes the full
and entire understanding and agreement among the parties with regard to the
subject matter hereof and thereof. Any prior agreements, understanding or
representations with respect to the subject matter hereof are superseded by this
Agreement shall have no further force or effect. Neither this Agreement nor any
term hereof may be amended, waived, discharged or terminated other than by a
written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought.
D. Notices, Etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be (a) mailed by registered or
certified mail, postage prepaid, return receipt requested, (b) delivered by a
nationally recognized overnight courier, (c) sent by confirmed facsimile or (d)
otherwise delivered by hand or by messenger, addressed (i) if to an Investor, at
such Investor's address set forth on Exhibit A to the Purchase Agreement, or at
such other address as such Investor shall have furnished to the Company in
writing, with a copy to Venture Law Group, 0000 Xxxx Xxxx Xxxx, Xxxxx Xxxx,
Xxxxxxxxxx 00000, Attention Xxxx X. Xxxxx, Fax: (000) 000-0000; or (ii) if to
the Company, at its address set forth on the signature
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
page of the Purchase Agreement addressed to the attention of the President, or
at such other address as the Company shall have furnished to the Investors, with
a copy to Xxxxxx & Xxxxxxx, 000 Xxxxxxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx
00000, Attention Xxxxxxx X. Xxxx, Fax: (000) 000-0000. If notice is provided by
mail, notice shall be deemed to be given 48 hours after proper deposit in a
mailbox; if by overnight courier, notice shall be deemed to be given 24 hours
after deposit; if by facsimile, upon completion of such facsimile transmission
as conclusively evidenced by the transmission receipt; and if by hand or
messenger, upon receipt.
E. Delays or Omissions. No delay or omission to exercise any right,
power or remedy accruing to any Person under this Agreement shall impair any
such right, power or remedy of such Person, nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of or in
any similar breach or default thereafter occurring; nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or approval of
any kind or character on the part of any Person of any breach or default under
this Agreement, or any waiver on the part of any Person of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in such writing or as provided in this
Agreement. All remedies, either under this Agreement or by law or otherwise
afforded to any Person, shall be cumulative and not alternative.
F. Counterparts. This Agreement may be executed in any number of
counterparts and signatures may be delivered by facsimile, each of which may be
executed by less than all parties, each of which shall be enforceable against
the parties actually executing such counterparts, and all of which together
shall constitute one instrument.
G. Severability. If any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, portions of such provision, or such provision in its entirety, to the
extent necessary, shall be severed from this Agreement and the balance of this
Agreement shall be enforceable in accordance with its terms.
H. Legal Fees. If any action at law or in equity (including
arbitration) 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.
I. Publicity. Except as required by law, no party hereto shall issue
any press release or make any public statement regarding the transactions
contemplated hereby without the prior approval of the other parties.
Notwithstanding the foregoing, the Company shall be permitted to make a public
statement without obtaining the consent of the Investors if (a) the disclosure
is required by the continued listing requirements of the Nasdaq National Market
and (b) the Company has used reasonable best efforts to consult with the
Investors about the form and substance of such disclosure.
(Signature Page Follows)
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
THE COMPANY:
COHESION TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
THE INVESTORS
THREE ARCH CAPITAL, L.P.
By: TAC Management, L.L.C.
Its: General Partner
By: /s/ Xxxx Xxx
-----------------------------------------
Title:
TAC ASSOCIATES, L.P.
By: TAC Management, L.L.C.
Its: General Partner
By: /s/ Xxxx Xxx
-----------------------------------------
Title:
ALTA CALIFORNIA PARTNERS III, L.P.
By: Alta California Management Partners
III, LLC
By: /s/ Xxx Xxxxx
-----------------------------------------
Title: Managing Director
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
ALTA BIOPHARMA PARTNERS II, L.P.
By: Alta BioPharma Management Partners
II, LLC
By: /s/ Xxxx Xxxxxxx
-----------------------------------------
Title: Managing Director
ALTA EMBARCADERO PARTNERS III, LLC
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Title: V.P. of Finance & Administration
ALTA EMBARCADERO BIOPHARMA PARTNERS II, LLC
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Title: V.P. of Finance & Administration
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
EXHIBIT A
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CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
