Exhibit 99.2
FORM OF PURCHASE AGREEMENT
PROPOSED FINANCING
OF
LIFECELL
LIFECELL CORPORATION
BY READING THE INFORMATION CONTAINED WITHIN THIS DOCUMENT, THE RECIPIENT AGREES
WITH LIFECELL CORPORATION AND XXXXX FARGO SECURITIES, LLC TO MAINTAIN IN
CONFIDENCE SUCH INFORMATION, TOGETHER WITH ANY OTHER NON-PUBLIC INFORMATION
REGARDING LIFECELL CORPORATION OBTAINED FROM LIFECELL CORPORATION, XXXXX FARGO
SECURITIES, LLC OR THEIR AGENTS DURING THE COURSE OF THE PROPOSED FINANCING.
LIFECELL CORPORATION AND XXXXX FARGO SECURITIES, LLC HAVE CAUSED THESE MATERIALS
TO BE DELIVERED TO YOU IN RELIANCE UPON SUCH AGREEMENT AND UPON RULE
100(B)(2)(II) OF REGULATION FD AS PROMULGATED BY THE SECURITIES AND EXCHANGE
COMMISSION.
[GRAPHIC OMITTED]
Xxxxx Fargo Securities, LLC
CONFIDENTIAL
SUMMARY OF TERMS AND CONDITIONS
This Confidential Summary of Terms and Conditions is not intended to be
contractually binding, other than the section entitled "Confidential
Information," and is subject in all respects (other than with respect to such
section) to the execution of the Stock Purchase Agreement.
Issuer: . . . . . . . . LifeCell Corporation, a Delaware corporation (the
"Company").
Securities Offered: . . Up to 3,701,257 shares (the "Shares") of common stock,
par value $0.001 per share (the "Common Stock"),
subject to adjustment by the Company (the "Offering").
Pre- and Post-Offering
Capitalization of the
Company: . . . . . . . . Type Pre-Financing Post-Financing
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Shares(1) Shares(2)
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Common Stock 21,429,841 25,131,098
Preferred Stock(3) 71,768 71,768
Stock Options and
Warrants(4) 4,355,824 4,355,824
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Total (fully diluted
Common Stock
equivalents) 28,385,963 32,087,220
(1) As of August 1, 2003.
(2) Assumes 3,701,257 Shares sold by the Company in
the Offering.
(3) Series B Preferred Stock. Convertible into an
aggregate of 2,600,298 shares of Common Stock. See
the Company's Certificate of Incorporation and
other public filings for the rights, preferences
and privileges of the Series B Preferred Stock.
(4) Includes outstanding Common Stock options that
were vested as of or vest within 60 days after
August 1, 2003 but excludes unvested Common Stock
options covering 1,345,037 shares.
Purchase Price: . . . . The purchase price of the Common Stock sold in the
Offering will be determined based upon the negotiations
between the Company and the investors participating in
this Offering (the "Investors").
Use of Proceeds to
Company:. . . . . . . . For working capital and general corporate purposes.
Subscription Date and
Closing Date: . . . . . The Company and each Investor shall execute a Stock
Purchase Agreement in substantially the form set forth
herein (the "Agreements") and each Investor shall
execute an Investor Questionnaire in substantially the
form set forth herein. The date as of which the Company
has executed Stock Purchase Agreements with Investors
for the purchase of at least 3,294,000 Shares and has
notified the placement agent for this Offering in
writing that it is no longer accepting Stock Purchase
Agreements from Investors (other than series B Holders)
is sometimes referred to herein as the "Subscription
Date." The closing of the Offering shall occur, and the
certificates representing the Shares shall be issued to
the Investors and funds paid to the Company therefor,
on August [ ], 2003 (the "Closing Date").
Investor Qualifications: Each Investor must be an "accredited investor" as
defined in Regulation D of the Securities Act of 1933,
as amended (the "Securities Act"), and must represent
and warrant to the Company that it is acquiring the
Shares for investment with no present intention of
distributing any of the Shares. The Stock Purchase
Agreement contains other appropriate representations
and warranties of the Investor to the Company. As part
of the Stock Purchase Agreement signature page, the
Company has included certain questions for each
Investor to complete regarding such Investor. In
addition, the Investor Questionnaire set forth herein
contains questions for each Investor regarding its
status as an "accredited investor." The Company will
use the answers from each Investor as part of its own
procedures to confirm the accuracy of the statements as
to such Investor in the Registration Statement,
including the information in the sections to be
entitled "Selling Stockholders" and "Plan of
Distribution." The Investors might be deemed
"underwriters" as that term is defined in the
Securities Act. Underwriters have statutory
responsibilities as to the accuracy of any Registration
Statement used by them.
Risk Factors:. . . . . The Shares offered hereby involve a high degree of
risk. See the disclosure relating to the risks
affecting the Company set forth in the documents filed
by the Company with the Securities and Exchange
Commission (the "SEC") under the Securities Exchange
Act of 1934, as amended.
Right of First Refusal: Holders of the Company's Series B Preferred Stock
("Series B Holders") own an aggregate of approximately
11% of the outstanding capital stock of the Company on
a fully-diluted basis. Pursuant to the Securities
Purchase Agreement dated as of November 18, 1996 by and
among the Company and the Series B Holders (the "Series
B Purchase Agreement"), the Series B Holders have a
right to purchase approximately 11% of the shares
offered in the Offering. Promptly after the execution
of Stock Purchase Agreements for the issuance and sale
of shares of Common Stock to third parties, the Company
will send a notification to each Series B Holder of
such sale and offer each Series B Holder the right to
purchase a number of shares of Common Stock equal to
such Series B Holder's Percentage Share (as defined in
the Series B Purchase Agreement). Pursuant to the
Series B Purchase Agreement, the Company is required to
keep the offering to the Series B Holders open for 30
days with an additional 7 days to satisfy
oversubscription rights.
Registration of
Common Stock: . . . . . The Company will use its best efforts, subject to
receipt of necessary information from the Investors, to
cause a Registration Statement on Form S-3 relating to
the resale of the Common Stock by the Investors to be
filed with the Securities and Exchange Commission
within 50 days following the Closing Date, and to cause
such Registration Statement to become effective within
90 days following the Closing Date. Subject to certain
blackout periods, the Company is obligated to use best
efforts, with respect to each Investor's Shares, to
maintain the Registration Statement's effectiveness
until the earlier of (i) two years after the closing of
the Offering, (ii) the date on which the Investor may
sell all Shares then held by the Investor without
restriction by the volume limitations of Rule 144(e) of
the Securities Act, or (iii) such time as all Shares
purchased by such Investor in the Offering have been
sold pursuant to a registration statement.
Liquidated Damages: . . In the event that the Registration Statement: (i) is
not filed by the Company within 50 days after the
Closing Date; (ii) is not declared effective by the SEC
on or prior to 90 days after the Closing Date; or (iii)
ceases to be effective and available to Investor for
any continuous period that exceeds 30 days or for one
or more periods that exceed in the aggregate 60 days in
any 12-month period (each, a "Registration Default"),
the Company shall pay the Investors, for each 30-day
period of a Registration Default, an amount in cash
equal to 1% of the aggregate purchase price paid by
Investors; provided that in no event shall the
aggregate amount of cash to be paid exceed 9% of the
aggregate purchase price. The foregoing payments shall
apply on a pro rata basis for any portion of a 30-day
period of a Registration Default.
Limitations on Sales
Pursuant to Registration
Statement:. . . . . . . To resell Shares pursuant to the Registration
Statement, the Investor will be required to:
(a) Deliver, prior to selling any Shares, a current
prospectus of the Company to the transferee (or
arrange for delivery to the transferee's broker).
Upon receipt of a written request therefor, the
Company has agreed to provide an adequate number
of current prospectuses to each Investor and to
supply copies to any other parties requiring such
prospectuses. In certain circumstances, the
Company may suspend the effectiveness of the
Registration Statement for certain periods of time
during which the Investors will not be able to
resell their Shares. In the event of such a
suspension, the Company will notify each Investor
in writing and, subject to certain conditions,
will use best efforts to cause the use of the
prospectus so suspended to be resumed as soon as
reasonably practicable within 20 business days
after such suspension begins, and will promptly
deliver a revised prospectus, if applicable, for
each Investor's use.
(b) Deliver the stock certificate along with the
Certificate of Subsequent Sale in the form
attached to the Stock Purchase Agreement to the
Company and its transfer agent so that the Shares
may be properly transferred.
Share Certificates: . . Certificates evidencing the Shares will bear a
restrictive legend stating that such Shares may not be
resold except as permitted under the Securities Act
pursuant to a Registration Statement that has been
declared effective or an exemption therefrom, and may
be resold subject to certain limitations and procedures
agreed to in the Stock Purchase Agreement.
Indemnification:. . . . By executing the Stock Purchase Agreement, each
Investor will agree to indemnify the Company against
certain liabilities.
Nasdaq National
Market ("Nasdaq")
Symbol: . . . . . . . . LIFC
Confidential
Information:. . . . . . The recipient of this Confidential Summary of Terms and
Conditions and the materials attached hereto agrees
with the Company and Xxxxx Fargo Securities, LLC to
maintain in confidence this disclosed information,
together with any other non-public information
regarding the Company obtained from the Company, Xxxxx
Fargo Securities, LLC or their agents during the course
of the proposed Offering. The Company and Xxxxx Fargo
Securities, LLC have caused these materials to be
delivered to you in reliance upon such agreement and
upon Rule 100(b)(2)(ii) of Regulation FD as promulgated
by the Securities and Exchange Commission.
Company's Counsel: . . Xxxxxxxxxx Xxxxxxx PC, 00 Xxxxxxxxxx Xxxxxx, Xxxxxxxx,
Xxx Xxxxxx 00000-0000; tel. (000) 000-0000, fax. (973)
597-2400; Attn: Xxxxxx Xxxxxxxx, Esq.
Transfer Agent: . . . . Computershare Investor Services, LLC, 0 Xxxxx XxXxxxx
Xxxxxx, Xxxxxxx, XX 00000; tel. (000) 000-0000.
Placement Agent:. . . . The Company has engaged Xxxxx Fargo Securities, LLC to
act as placement agent in connection with the Offering.
The placement agent will receive from the Company a fee
based on a percentage of the gross proceeds from the
sale of the Shares. In addition, Xxxx Capital Partners,
LLC will also receive compensation from the Company in
connection with the Offering.
Placement Agent's
Counsel:. . . . . . . . Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP, 000 Xxxx Xxxxxx,
Xxxxxx, XX 00000; tel. (000) 000-0000, fax. (617)
248-7100; Attn: Xxxxxxx X. Xxxx, Esq.
INSTRUCTION SHEET FOR INVESTOR
(To be read in conjunction with the entire Stock Purchase Agreement and the
Investor Questionnaire)
A. Complete the following items in the Stock Purchase Agreement and in the
Investor Questionnaire:
1. Provide the information regarding the Investor requested on the
signature pages (pages 7 and 22). Please submit a separate Stock Purchase
Agreement and Investor Questionnaire for each individual fund/entity that will
hold the Shares. The Stock Purchase Agreement and the Investor Questionnaire
must be executed by an individual authorized to bind the Investor.
2. Return the signed Stock Purchase Agreement and Investor
Questionnaire to:
LifeCell Corporation
Xxx Xxxxxxxxxx Xxx
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
And fax copies to:
Xxxxx Fargo Securities, LLC
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
And
Xxxxxxxxxx Xxxxxxx PC
00 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000-0000
Attn: Xxxxxx Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
An executed original Stock Purchase Agreement and Investor Questionnaire or
a fax thereof must be received by 2:00 p.m., New York City time, on a date
to be determined and distributed to the Investor at a later date.
B. Instructions regarding the transfer of funds for the purchase of Shares
will be faxed to the Investor by the Company at a later date.
C. To resell the Shares after the Registration Statement covering the Shares
is effective:
1. Provided that a Suspension of the Registration Statement
pursuant to Section 7.2(c) of the Stock Purchase Agreement is not then in effect
pursuant to the terms of the Stock Purchase Agreement, the Investor may sell
Shares under the Registration Statement, subject to the notification provisions
in the Stock Purchase Agreement, provided that it arranges for delivery of a
current Prospectus to the transferee. Upon receipt of a request therefor, the
Company has agreed to provide an adequate number of current Prospectuses to each
investor and to supply copies to any other parties requiring such Prospectuses.
2. The Investor must also deliver to the Company's transfer agent,
with a copy to the Company, a Certificate of Subsequent Sale in the form
attached as Exhibit A to the Stock Purchase Agreement, so that the Shares may be
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properly transferred.
STOCK PURCHASE AGREEMENT
LifeCell Corporation
Ladies & Gentlemen:
The undersigned, _________________________________(the "Investor"), hereby
confirms its agreement with you as follows:
1. This Stock Purchase Agreement is made as of August __, 2003 between
LifeCell Corporation, a Delaware corporation (the "Company"), and the Investor.
2. The Company has authorized the sale and issuance of up to 3,701,257
shares (the "Shares") of common stock of the Company, $0.001 par value per share
(the "Common Stock") to certain investors in a private placement (the
"Offering").
3. The Company and the Investor agree that the Investor will purchase from
the Company and the Company will issue and sell to the Investor ___________
Shares for a purchase price of $4.25 per share, or an aggregate purchase price
of $_______________, pursuant to the Terms and Conditions for Purchase of Shares
attached hereto as Annex I and incorporated herein by reference as if fully set
forth herein (the "Terms and Conditions"). This Stock Purchase Agreement,
together with the Terms of Conditions which are incorporated herein by reference
as if fully set forth herein, may hereinafter be referred to as the "Agreement".
Unless otherwise requested by the Investor, the certificates representing the
Shares purchased by the Investor will be registered in the Investor's name and
address as set forth below.
Please confirm that the foregoing correctly sets forth the agreement
between us by signing in the space provided below for that purpose. By
executing this Agreement, the Investor acknowledges that the Company may use the
information in paragraph 4 above and the name and address information below in
preparation of the Registration Statement (as defined in Annex 1).
AGREED AND ACCEPTED:
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LifeCell Corporation Investor:
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By:
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By: Print Name:
---------------------------------
Title:
Title:
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Address:
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Tax ID No.:
--------------------------------
Contact name:
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Telephone:
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Name in which shares should be registered (if
different):
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ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF SHARES
1. Authorization and Sale of the Shares. Subject to these Terms and
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Conditions, the Company has authorized the sale of up to 3,701,257 Shares. The
Company reserves the right to increase or decrease this number.
2. Agreement to Sell and Purchase the Shares; Subscription Date.
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2.1 At the Closing (as defined in Section 3), the Company will sell
to the Investor, and the Investor will purchase from the Company, upon the terms
and conditions hereinafter set forth, the number of Shares as set forth in
Section 3 of the Stock Purchase Agreement to which these Terms and Conditions
are attached at the purchase price set forth thereon.
2.2 The Company may enter into the same form of Stock Purchase
Agreement, including these Terms and Conditions, with certain other investors
(the "Other Investors") and expects to complete sales of Shares to them. (The
Investor and the Other Investors are hereinafter sometimes collectively referred
to as the "Investors," and the Stock Purchase Agreement to which these Terms and
Conditions are attached and the Stock Purchase Agreements (including attached
Terms and Conditions) executed by the Other Investors are hereinafter sometimes
collectively referred to as the "Agreements.") The Company may accept executed
Agreements from Investors for the purchase of Shares commencing upon the date on
which the Company provides the Investors with the proposed purchase price per
Share and concluding upon the date (the "Subscription Date") on which the
Company has (i) executed Agreements with Investors for the purchase of at least
3,294,000 Shares, and (ii) notified Xxxxx Fargo Securities, LLC, in its capacity
as placement agent for this transaction, in writing that it is no longer
accepting additional Agreements from Investors (other than Series B Holders) for
the purchase of Shares. The Company may not enter into any Agreements after the
Subscription Date.
2.3 The obligations of each Investor under any Agreement are several
and not joint with the obligations of any Other Investor, and no Investor shall
be responsible in any way for the performance of the obligations of any other
Investor under any Agreement. Nothing contained herein, and no action taken by
any Investor hereto, shall be deemed to constitute the Investors as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Investors are in any way acting in concert or as a
group with respect to such obligations or the transactions contemplated hereby,
provided that such obligations or the transactions contemplated hereby may be
modified, amended or waived in accordance with Section 9 below. Each Investor
shall be entitled to independently protect and enforce its rights, including
without limitation the rights arising out of this Agreement (provided, that such
rights may be modified, amended or waived in accordance with Section 9 below),
and it shall not be necessary for any Other Investor to be joined as an
additional party in any proceeding for such purpose.
3. Delivery of the Shares at Closing. The completion of the purchase
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and sale of the Shares (the "Closing") shall occur (the "Closing Date") on
August __, 2003, at the offices of the Company's counsel. At the Closing, the
Company shall deliver to the Investor one or more stock certificates
representing the number of Shares, as is set forth in Section 3 of the Stock
Purchase Agreement, each such certificate to be registered in the name of the
Investor or, if so indicated on the signature page of the Stock Purchase
Agreement, in the name of a nominee designated by the Investor.
The Company's obligation to issue the Shares to the Investor shall be
subject to the following conditions, any one or more of which may be waived by
the Company: (a) receipt by the Company of a certified or official bank check or
wire transfer of funds in the full amount of the purchase price for the Shares
being purchased hereunder as set forth in Section 3 of the Stock Purchase
Agreement; (b) completion of the purchases and sales under the Agreements with
the Other Investors; and (c) the accuracy of the representations and warranties
made by the Investors and the fulfillment of those undertakings of the Investors
to be fulfilled prior to the Closing.
The Investor's obligation to purchase the Shares shall be subject to the
following conditions, any one or more of which may be waived by the Investor:
(a) Investors shall have executed Agreements for the purchase of at least
3,294,000 Shares, (b) the representations and warranties of the Company set
forth herein shall be true and correct as of the Closing Date in all material
respects (except for representations and warranties that speak as of a specific
date, which representations and warranties shall be true and correct as of such
date) and (c) the Investor shall have received such documents as such Investor
shall reasonably have requested, including, a standard opinion of the Company's
counsel as to certain of the matters set forth in Section 4 and as to exemption
from the registration requirements of the Securities Act of 1933, as amended
(the "Securities Act"), of the sale of the Shares.
4. Representations, Warranties and Covenants of the Company. The
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Company hereby represents and warrants to, and covenants with, the Investor, as
follows:
4.1 Organization and Qualification. The Company is a corporation duly
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organized, validly existing and in good standing under the laws of the State of
Delaware. The Company does not own, directly or indirectly, any shares of stock
or any other equity or long-term debt securities of any corporation or have any
equity interest in any firm, partnership, joint venture, association or other
entity. The Company has the power and authority, corporate or otherwise, as
appropriate, to own, lease and operate its properties and to conduct its
business as now conducted and as described in the documents filed by the Company
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
since the end of its most recently completed fiscal year through the date
hereof, including, without limitation, its most recent report on Form 10-K (the
"Exchange Act Documents") and to enter into and perform its obligations under
the Agreements. The Company is duly qualified as a foreign corporation and is
in good standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify would not individually or in
the aggregate have a material adverse effect on the condition (financial or
otherwise), earnings, properties, business, prospects or results of operations
of the Company (a "Material Adverse Effect") and no proceeding has been
instituted in any such jurisdiction, revoking, limiting or curtailing, or
seeking to revoke, limit or curtail, such power and authority or qualification.
4.2 Capital Stock. The capitalization of the Company as of June 30,
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2003 is as set forth in the most recent applicable Exchange Act Documents,
increased as set forth in the next sentence. The Company has not issued any
capital stock since that date other than pursuant to (i) employee benefit plans
disclosed in the Exchange Act Documents, or (ii) the exercise of outstanding
warrants, options or other securities disclosed in the Exchange Act Documents.
The issued and outstanding shares of the Company's preferred stock, par value
$.001 per share (the "Preferred Stock"), and Common Stock have been duly
authorized and validly issued, are fully paid and nonassessable, were not issued
in violation of or are not otherwise subject to any preemptive or other similar
rights or other rights to subscribe for or purchase securities, and conform to
the description thereof contained in the Exchange Act Documents. Except as
disclosed in the Exchange Act Documents, the Company does not have outstanding
any options or warrants to purchase, or any preemptive rights or other rights to
subscribe for or to purchase, any securities or obligations convertible into, or
any contracts or commitments to issue or sell, shares of its capital stock or
other securities or any shares of capital stock or other securities of any
subsidiary and there is no commitment, plan or arrangement to issue, any
securities or obligations convertible into any shares of capital stock of the
Company or any such options, rights convertible securities or obligations. The
description of the Company's capital stock, stock bonus and other stock plans or
arrangements and the options or other rights granted and exercised thereunder,
contained in the Exchange Act Documents accurately and fairly presents the
information required to be shown with respect to such capital stock, plans,
arrangements, options and rights. Except as disclosed in the Exchange Act
Documents, there are no stockholders agreements, voting agreements or other
similar agreements with respect to the capital stock of the Company to which the
Company is a party or, to the knowledge of the Company, between or among any of
the Company's stockholders.
4.3 Issuance, Sale and Delivery of the Shares. The Shares have been
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duly authorized and, when issued, delivered and paid for in the manner set forth
in this Agreement, will be duly authorized, validly issued, fully paid and
nonassessable. No preemptive rights or other rights (which have not been
waived) to subscribe for or purchase exist with respect to the issuance and sale
of the Shares by the Company pursuant to the Agreements. Except for rights
disclosed in the Exchange Act Documents, no stockholder of the Company has any
right to request or require the Company to register the sale of any shares owned
by such stockholder under the Securities Act. No further approval or authority
of the stockholders or the Board of Directors of the Company will be required
for the issuance and sale of the Shares.
4.4 Due Execution, Delivery and Performance of the Agreements. The
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Company has full legal right, corporate power and authority to enter into the
Agreements and to perform the transactions contemplated thereby. The Agreements
have been duly authorized, executed and delivered by the Company. The
execution, delivery and performance of the Agreements, the issuance and sale of
the Shares under the Agreements, the fulfillment of the terms of the Agreements
by the Company and the consummation of the transactions contemplated thereby
will not (a) violate any provision of the charter, by-laws or other
organizational documents of the Company, (b) result in the creation of any lien,
charge, security interest or encumbrance upon any assets or property of the
Company pursuant to the terms or provisions of, or will not conflict with,
result in the breach or violation of, or constitute, either by itself or upon
notice or the passage of time or both, a default under any agreement, material
bond, debenture, note or other evidence of indebtedness, contract, loan
agreement, joint venture or other agreement, mortgage, deed of trust, lease,
franchise, license, indenture, permit or other instrument to which the Company
is a party or by which the Company or any of its assets or properties may be
bound or affected or, to the Company's knowledge, any statute or any
authorization, judgment, decree, order, rule or regulation of any court,
arbitration panel or any regulatory body, administrative agency or other
governmental body applicable to the Company or any of its properties or (c)
result in an acceleration of indebtedness pursuant to any obligation, agreement
or condition contained in any material bond, debenture, note or any other
evidence of indebtedness or any material indenture, mortgage, deed of trust or
any other agreement or instrument to which the Company is a party or by which
any of them is bound or to which any of the material property or assets of the
Company is subject. No consent, approval, authorization or other order of any
court, regulatory body, administrative agency or other governmental body is
required for the execution, delivery and performance of the Agreements or the
consummation of the transactions contemplated hereby or thereby, except for
compliance with Blue Sky laws and federal securities laws applicable to the
offering and registration for resale of the Shares and compliance with the rules
and regulations of the securities exchange or trading market on which the Common
Stock is listed. Upon the execution and delivery, and assuming the valid
execution of the Agreements by the Investors, each of the Agreements will
constitute valid and binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and except as enforceability
may be subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and except as
the indemnification agreements of the Company in Section 7.3 hereof may be
legally unenforceable.
4.5 Financials. The Company's financial statements (including all
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notes and schedules thereto) included in the Exchange Act Documents present
fairly the financial position, the results of operations, the statements of cash
flows and the statements of stockholders' equity and the other information
purported to be shown therein of the Company at the respective dates and for the
respective periods to which they apply and such financial statements have been
prepared in conformity with generally accepted accounting principles,
consistently applied throughout the periods involved.
4.6 No Defaults. The Company is not (i) in violation or default of any
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provision of its certificate of incorporation, bylaws or other organizational
documents, or (ii) in breach of or default with respect to any provision of any
agreement, judgment, decree, order, mortgage, deed of trust, lease, franchise,
license, indenture, permit or other instrument to which it is a party or by
which it or any of its assets or properties are bound, except for violations,
breaches and defaults which individually or in the aggregate would not have a
Material Adverse Effect; and there does not exist any state of fact which, with
notice or lapse of time or both, would constitute an event of default on the
part of the Company as defined in such documents, except such defaults which
individually or in the aggregate would not have a Material Adverse Effect.
4.7 Contracts. The contracts described in the Exchange Act Documents
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as being in effect on the date hereof that are material to the Company, are in
full force and effect on the date hereof, and the Company is not, nor to the
Company's knowledge, is any other party in breach of or default under any of
such contracts which would have a Material Adverse Effect.
4.8 No Actions. Except as disclosed in the Exchange Act Documents,
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there are no legal or governmental actions, suits or proceedings pending or, to
the Company's knowledge, threatened to which the Company is or may be a party or
of which property owned or leased by the Company is or may be the subject, or
related to environmental or discrimination matters, which actions, suits or
proceedings, individually or in the aggregate, might prevent or might reasonably
be expected to materially and adversely affect the transactions contemplated by
the Agreements or result in a material adverse change in the condition
(financial or otherwise), properties, business, prospects or results of the
operations of the Company (a "Material Adverse Change"); and all pending legal
or governmental proceedings to which the Company is a party or of which any of
its property or assets is the subject which are not described in the Exchange
Act Documents, including ordinary routine litigation incidental to the business,
are, considered in the aggregate, not material. Except as disclosed in the
Exchange Act Documents, the Company is not a party to or subject to the
provisions of any material injunction, judgment, decree or order of any court,
regulatory body administrative agency or other governmental body.
4.9 Labor. No labor dispute with the employees of the Company exists
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or, to the knowledge of the Company, is imminent; and the Company is not aware
of any existing or imminent labor disturbance by the employees of any of its
principal suppliers, manufacturers or contractors which might, singly or in the
aggregate, have a Material Adverse Effect.
4.10 Properties. The Company has valid title to all its properties as
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described in the Exchange Act Documents, and such properties are not subject to
any lien, mortgage, pledge, charge or encumbrance of any kind, except (i) those,
if any, reflected in the financial statements of the Company (including the
notes thereto) contained in the Exchange Act Documents, or (ii) those which are
not material in amount and do not materially and adversely affect the use made
and intended to be made of such property by the Company. The Company holds its
leased properties under valid and binding leases, with such exceptions as are
not materially significant in relation to the business of the Company. Except
as disclosed in the Exchange Act Documents, the Company owns or leases all such
properties as are necessary to its operations as now conducted.
4.11 No Material Change. Since June 30, 2003, (i) the Company has not
------------------
incurred any liabilities or obligations, indirect, or contingent, or entered
into any verbal or written agreement or other transaction which is not in the
ordinary
course of business or which could reasonably be expected to result in a material
reduction in the future earnings of the Company or in a Material Adverse Effect;
(ii) the Company has not sustained any material loss or interference with its
businesses or properties from fire, flood, windstorm, accident or other calamity
not covered by insurance; (iii) the Company has not paid or declared any
dividends or other distributions with respect to its capital stock, and the
Company is not in default in the payment of principal or interest on any
outstanding debt obligations; (iv) there has not been any change in the capital
stock of the Company other than the sale of the Shares and shares or options
issued pursuant to employee and director stock option plans approved by the
Company's Board of Directors or indebtedness material to the Company (other than
in the ordinary course of business); and (v) there has not been a change that
would result in a Material Adverse Change.
4.12 Intellectual Property. Except as otherwise specifically disclosed
---------------------
in the Exchange Act Documents, (i) the Company owns or has obtained valid
licenses, options or rights to use for the material inventions, patent
applications, patents, trademarks (both registered and unregistered), trade
names, copyrights and trade secrets necessary for the conduct of the Company's
business as currently conducted (collectively, the "Intellectual Property") or
as proposed to be conducted as described in the Exchange Act Documents; (ii) the
Company has not received notice of any third parties claiming any ownership
rights to any Intellectual Property that is owned by, or has been licensed to,
the Company ; (iii) to the Company's knowledge, there is currently no
infringement by third parties of any material Intellectual Property owned,
licensed or optioned by the Company; (iv) there is no pending or, to the
Company's knowledge, threatened action, suit, proceeding or claim by others
challenging the rights of the Company in or to any material Intellectual
Property owned, licensed or optioned by the Company; (v) there is no pending or,
to the Company's knowledge, threatened action, suit, proceeding or claim by
others challenging the validity or scope of any material Intellectual Property
owned, licensed or optioned by the Company; and (vi) there is no pending or, to
the Company's knowledge, threatened action, suit, proceeding or claim by others
that the Company infringes or otherwise violate any patent, trademark,
copyright, trade secret or other proprietary right of others as would reasonably
be expected to result in a Material Adverse Effect.
4.13 Compliance. The Company's Common Stock is registered pursuant to
----------
Section 12(g) of the Exchange Act and is listed on The Nasdaq Stock Market, Inc.
National Market (the "Nasdaq National Market"), and the Company has taken no
action designed to, or likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act or de-listing the Common
Stock from the Nasdaq National Market, nor has the Company received any
notification that the SEC or the National Association of Securities Dealers,
Inc. ("NASD") is contemplating terminating such registration or listing. Except
as disclosed in the Exchange Act Documents, the Company has not been advised,
and has no reason to believe, that it is not conducting its business in
compliance with all applicable laws, rules and regulations of the jurisdictions
in which it is conducting business; except where failure to be so in compliance
would not individually or in the aggregate have a Material Adverse Effect.
4.14 Environmental Matters. Except as disclosed in the Exchange Act
----------------------
Documents and except as would not, singly or in the aggregate, reasonably be
expected to have a Material Adverse Effect, (A) the Company is in compliance
with all applicable Environmental Laws, (B) the Company has all permits,
authorizations and approvals required under any applicable Environmental Laws
and is in compliance with the requirements of such permits, authorizations and
approvals, (C) there are no pending or, to the knowledge of the Company,
threatened Environmental Claims against the Company and (D) under applicable
law, there are no circumstances with respect to any property or operations of
the Company that are reasonably likely to form the basis of an Environmental
Claim against the Company.
For purposes of this Agreement, the following terms shall have the
following meanings: "Environmental Law" means any United States (or other
applicable jurisdiction's) federal, state, local or municipal statute, law,
rule, regulation, ordinance, code, policy or rule of common law and any judicial
or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
health, safety or any chemical, material or substance, exposure to which is
prohibited, limited or regulated by any governmental authority. "Environmental
Claims" means any and all administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or violation,
investigations or proceedings relating in any way to any Environmental Law.
4.15 Taxes. The Company has filed or obtained filing extensions with
-----
respect to all federal, state, local and foreign income and franchise tax
returns material to the Company, and has paid or accrued all taxes shown as due
thereon, and the Company has no knowledge of a tax deficiency which has been or
might be asserted or threatened against it which would reasonably be expected to
have a Material Adverse Effect.
4.16 Transfer Taxes. On the Closing Date, all stock transfer or other
--------------
taxes (other than income taxes) which are required to be paid in connection with
the sale and transfer of the Shares to be sold to the Investors hereunder will
be, or will have been, fully paid or provided for by the Company and all laws
imposing such taxes will be or will have been fully complied with.
4.17 Insurance. The Company maintains insurance of the type and in the
---------
amount that the Company reasonably believes is adequate for its business,
including, but not limited to, insurance covering all real and personal property
owned or leased by the Company against risks customarily insured against by
similarly situated companies, all of which insurance is in full force and
effect.
4.18 Contributions. The Company has not directly or indirectly, (i)
-------------
made any unlawful contribution to any candidate for public office, or failed to
disclose fully where required by law any contribution in violation of law, or
(ii) made any payment to any federal or state governmental officer or official,
or other person charged with similar public or quasi-public duties, other than
payments required or permitted by the laws of the United States or any
jurisdiction thereof.
4.19 Investment Company. The Company is not, and immediately after
-------------------
receipt of payment for the Shares will not be, an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for an
investment company, within the meaning of the Investment Company Act of 1940, as
amended (the "Investment Company Act") and shall conduct its business in a
manner so that it will not become subject to the Investment Company Act.
4.20 Related Party Transactions. No transaction has occurred between
---------------------------
or among the Company and its affiliates, officers or directors or any affiliate
or affiliates of any such officer or director that is required to be described
in the Exchange Act Documents that is not so described.
4.21 Books and Records; Internal Controls. The books, records and
----------------------------------------
accounts of the Company accurately and fairly reflect, in reasonable detail, the
transactions in, and dispositions of, the assets of, and the results of
operations of, the Company, all to the extent required by generally accepted
accounting principles. The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific authorizations,
(ii) transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles and to
maintain asset accountability, (iii) access to assets is permitted only in
accordance with management's general or specific authorization and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. The Company's certifying officers have established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
the Company and designed such disclosure controls and procedures to ensure that
material information relating to the Company, including its subsidiaries, is
made known to the certifying officers by others within those entities,
particularly during the period in which the Form 10-K or Form 10-Q, as the case
may be, is being prepared. The Company's certifying officers have evaluated the
effectiveness of the Company's disclosure controls and procedures as of a date
within ninety (90) days prior to the filing date of each Annual Report on Form
10-K or Quarterly Report on Form 10-Q, as the case may be (such date, the
"Evaluation Date") for which such evaluation was required by all applicable
Exchange Act Rules. The Company presented in each Annual Report on Form 10-K or
Quarterly Report on Form 10-Q, as the case may be, the conclusions of the
certifying officers about the effectiveness of the disclosure controls and
procedures based on their evaluations as of the Evaluation Date. Since the
Evaluation Date, there have been no significant changes in the Company's
internal controls (as such term is used in Item 307(b) of Regulation S-K under
the Exchange Act) or, to the Company's knowledge, in other factors that could
significantly affect the Company's internal controls.
4.22 Regulatory Matters. Except as described in the Exchange Act
-------------------
Documents, to the Company's knowledge, there are no rulemaking or similar
proceedings before The United States Food and Drug Administration or comparable
federal, state, local or foreign government bodies which involve or affect the
Company, which, if the subject of an action unfavorable to the Company, could
involve a Material Adverse Change.
4.23 Employee Agreements. To the knowledge of the Company, if any
--------------------
full-time employee identified in the Exchange Act Documents has entered into any
non-competition, non-disclosure, confidentiality or other similar agreement with
any party other than the Company, such employee is neither in violation thereof
nor is expected to be in violation thereof as a result of the business conducted
or expected to be conducted by the Company as described in the Exchange Act
Documents or such person's performance of his obligations to the Company; and
the Company has not received written notice that any consultant or scientific
advisor of the Company is in violation of any non-competition, non-disclosure,
confidentiality or similar agreement.
4.24 Finders' Fees. With the exception of Xxxxx Fargo Securities, LLC
-------------
and Xxxx Capital Partners, LLC, there is no investment banker, broker, finder or
other intermediary which has been retained by or is authorized to act on behalf
of the Company who might be entitled to any fee or commission from the Company
or any of its affiliates upon consummation of the transactions contemplated by
this Agreement.
4.25 Governmental Permits, Etc. With the exception of the matters
---------------------------
which are dealt with separately in Sections 4.1, 4.13, 4.27 and 4.28, the
Company has all necessary franchises, licenses, certificates and other
authorizations from any foreign, federal, state or local government or
governmental agency, department, or body that are currently necessary for the
operation of the business of the Company as currently conducted and as described
in the Exchange Act Documents except where the failure to currently possess
could not reasonably be expected to have a Material Adverse Effect.
4.26 Disclosure. The representations and warranties of the Company
----------
contained in this Section 4 as of the date hereof and as of the Closing Date, do
not contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
Except with respect to the material terms and conditions of the transaction
contemplated by the Agreements, which shall be publicly disclosed by the Company
pursuant to Section 16 hereof, the Company confirms that neither it nor any
person acting on its behalf has provided Investor with any information that the
Company believes constitutes material, non-public information. The Company
understands and confirms that Investor will rely on the foregoing
representations in effecting transactions in securities of the Company.
4.27 Reporting Status. The Company has filed in a timely manner all
-----------------
documents that the Company was required to file under the Exchange Act during
the 12 months preceding the date of this Agreement. The Company is eligible to
use Form S-3 to register the Shares to be offered for the account of the
Investors. The following documents complied in all material respects with the
SEC's requirements as of their respective filing dates, and the information
contained therein as of the date thereof did not contain an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein in light of the circumstances under
which they were made not misleading:
(a) Annual Report on Form 10-K for the year ended December 31, 2002,
Quarterly Report on Form 10-Q for the quarter ended March 31, 2003,
Quarterly Report on Form 10-Q for the quarter ended June 30, 2003 and
Proxy Statement on Schedule 14A filed on April 24, 2003; and
(b) all other documents, if any, filed by the Company with the SEC
during the period between the filing of the Form 10-K for the year
ended December 31, 2002 and the date of the Agreement pursuant to the
reporting requirements of the Exchange Act.
4.28 Listing. The Company shall comply with all requirements of
-------
the National Association of Securities Dealers, Inc. with respect to the
issuance of the Shares and the listing of the Shares on the Nasdaq National
Market.
4.29 No Manipulation of Stock. The Company has not taken and will
------------------------
not, in violation of applicable law, take, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the Shares.
4.30 Foreign Corrupt Practices. Neither the Company, nor to the
---------------------------
knowledge of the Company, any agent or other person acting on behalf of the
Company, has (i) directly or indirectly, used any corrupt funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to
foreign or domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any foreign or
domestic political parties or campaigns from corporate funds, (iii) failed to
disclose fully any contribution made by the Company (or made by any person
acting on its behalf of which the Company is aware) which is in violation of
law, or (iv) violated in any material respect any provision of the Foreign
Corrupt Practices Act of 1977, as amended.
4.31 Accountants. To the Company's knowledge,
-----------
PriceWaterhouseCoopers LLP, who the Company expects will consent to the
incorporation by reference of its report dated February 12, 2003 with respect to
the financial statements of the Company included in the Company's Annual Report
on Form 10-K for the year ended December 31, 2002 into the Registration
Statement (as defined below) and the prospectus which forms a part thereof, are
independent accountants as required by the Securities Act and the rules and
regulations promulgated thereunder.
4.32 Private Offering. Assuming the correctness of the
-----------------
representations and warranties of the Investors set forth in Section 5 hereof,
the offer and sale of Shares hereunder is exempt from registration under the
Securities Act. The Company has not distributed and will not distribute prior
to the Closing Date any offering material in connection with this Offering and
sale of the Shares other than the documents of which this Agreement is a part or
the Exchange Act Documents. The Company has not in the past nor will it
hereafter take any action independent of the placement agent to sell, offer for
sale or solicit offers to buy any securities of the Company which would bring
the offer, issuance or sale of the Shares as contemplated by the Agreements,
within the provisions of Section 5 of the Securities Act, unless such offer,
issuance or sale was or shall be within the exemptions of Section 4 of the
Securities Act.
5. Representations, Warranties and Covenants of the Investor.
---------------------------------------------------------------
5.1 The Investor represents and warrants to, and covenants with, the
Company that: (i) the Investor is an "accredited investor" as defined in
Regulation D under the Securities Act and the Investor is also knowledgeable,
sophisticated and experienced in making, and is qualified to make decisions with
respect to investments in shares presenting an investment decision like that
involved in the purchase of the Shares, including investments in securities
issued by the Company and investments in comparable companies, and has
requested, received, reviewed and considered all information it deemed relevant
in making an informed decision to purchase the Shares; (ii) the Investor is
acquiring the number of Shares, as set forth in Section 3 of the Stock Purchase
Agreement, in the ordinary course of its business and for its own account for
investment only and with no present intention of distributing any of such Shares
or any arrangement or understanding with any other persons regarding the
distribution of such Shares; (iii) the Investor will not, directly or
indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit
any offers to buy, purchase or otherwise acquire or take a pledge of) any of the
Shares except in compliance with the Securities Act, applicable state securities
laws and the respective rules and regulations promulgated thereunder; (iv) the
Investor has answered all questions on the Investor Questionnaire for use in
preparation of the Registration Statement and the answers thereto are true,
correct and complete as of the date hereof and will be true, correct and
complete as of the Closing Date; (v) the Investor will notify the Company
immediately of any change in any of such information until such time as the
Investor has sold all of its Shares or until the Company is no longer required
to keep the Registration Statement effective; and (vi) the Investor has, in
connection with its decision to purchase the number of Shares, as set forth in
Section 3 of the Stock Purchase Agreement, relied only upon the Exchange Act
Documents and the representations and warranties of the Company contained
herein. The Investor understands that its acquisition of the Shares has not been
registered under the Securities Act or registered or qualified under any state
securities law in reliance on specific exemptions therefrom, which exemptions
may depend upon, among other things, the bona fide nature of the Investor's
investment intent as expressed herein. Subject to compliance with the Securities
Act, applicable securities laws and the respective rules and regulations
promulgated thereunder, nothing contained herein shall be deemed a
representation or warranty by such Investor to hold the Shares for any period of
time. The Investor has completed or caused to be completed and delivered to the
Company the Investor Questionnaire, which questionnaire is true, correct and
complete in all material respects.
5.2 The Investor acknowledges, represents and agrees that no action
has been or will be taken in any jurisdiction outside the United States by the
Company that would permit an offering of the Shares or possession or
distribution of offering materials in connection with the issue of the Shares in
any jurisdiction outside the United States where legal action by the Company for
that purpose is required. Each Investor outside the United States will comply
with all applicable laws and regulations in each foreign jurisdiction in which
it purchases, offers, sells or delivers Shares or has in its possession or
distributes any offering material, in all cases at its own expense.
5.3 The Investor hereby covenants with the Company not to make any
sale of the Shares without complying with the provisions of this Agreement and
without causing the prospectus delivery requirement under the Securities Act to
be satisfied (whether by delivery of the Prospectus or pursuant to and in
compliance with an exemption from such requirement), and the Investor
acknowledges that the certificates evidencing the Shares will be imprinted with
a legend that prohibits their transfer except in accordance therewith. The
Investor acknowledges that there may occasionally be times when the Company
determines that it must suspend the use of the Prospectus forming a part of the
Registration Statement, as set forth in Section 7.2(c).
5.4 The Investor further represents and warrants to, and covenants
with, the Company that (i) the Investor has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement, and (ii) this Agreement
constitutes a valid and binding obligation of the Investor enforceable against
the Investor in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the indemnification agreements of the Investors
herein may be legally unenforceable.
5.5 Investor will not use any of the Shares acquired pursuant to this
Agreement, to cover any short position in the Common Stock of the Company if
doing so would be in violation of applicable securities laws.
5.6 The Investor understands that nothing in the Exchange Act
Documents, this Agreement or any other materials presented to the Investor in
connection with the purchase and sale of the Shares constitutes legal, tax or
investment advice. The Investor has consulted such legal, tax and investment
advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Shares.
5.7 The Company acknowledges and agrees that Investor does not make or
has not made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in Sections 5 and
16(a) of this Agreement, or in the Investor Questionnaire.
6. Survival of Representations, Warranties and Agreements.
-----------------------------------------------------------
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Shares being purchased and the payment therefor.
7. Registration of the Shares; Compliance with the Securities Act.
-------------------------------------------------------------------
7.1 Registration Procedures and Other Matters. The Company shall:
---------------------------------------------
(a) subject to receipt of necessary information from the
Investors after prompt request from the Company to the Investors to provide such
information, prepare and file with the SEC, within 50 days after the Closing
Date, a registration statement on Form S-3 (the "Registration Statement") to
enable the resale of the Shares by the Investors from time to time through the
automated quotation system of the Nasdaq National Market or in
privately-negotiated transactions;
(b) subject to receipt of necessary information from the
Investors after prompt request from the Company to the Investors to provide such
information, use its best efforts to cause the Registration Statement to become
effective within 30 days after the Registration Statement is filed by the
Company such efforts to include, without limiting the generality of the
foregoing, preparing and filing with the SEC in such 30-day period any financial
statements that are required to be filed prior to the effectiveness of such
Registration Statement;
(c) use its best efforts to prepare and file with the SEC such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith (the "Prospectus") as may be necessary to keep the
Registration Statement current, effective and free from any material
misstatement or omission to state a material fact for a period not exceeding,
with respect to each Investor's Shares purchased hereunder, the earlier of (i)
the second anniversary of the Closing Date, (ii) the date on which the Investor
may sell all Shares then held by the Investor without restriction by the volume
limitations of Rule 144(e) of the Securities Act, or (iii) such time as all
Shares purchased by such Investor in this Offering have been sold;
(d) furnish to the Investor with respect to the Shares registered
under the Registration Statement such number of copies of the Registration
Statement and Prospectuses in conformity with the requirements of the Securities
Act and such other documents as the Investor may reasonably request, in order to
facilitate the public sale or other disposition of all or any of the Shares by
the Investor; provided, however, that the obligation of the Company to deliver
copies of Prospectuses to the Investor shall be subject to the receipt by the
Company of reasonable assurances from the Investor that the Investor will comply
with the applicable provisions of the Securities Act and of such other
securities or blue sky laws as may be applicable in connection with any use of
such Prospectuses;
(e) file documents required of the Company for normal blue sky
clearance in states specified in writing by the Investor and use its best
efforts to maintain such blue sky qualifications during the period the Company
is required to maintain the effectiveness of the Registration Statement pursuant
to Section 7.1(c); provided, however, that the Company shall not be required to
qualify to do business or consent to service of process in any jurisdiction in
which it is not now so qualified or has not so consented;
(f) bear all expenses in connection with the procedures in
paragraph (a) through (e) of this Section 7.1 and the registration of the Shares
pursuant to the Registration Statement; and
(g) advise the Investor, promptly after it shall receive notice
or obtain knowledge of the issuance of any stop order by the SEC delaying or
suspending the effectiveness of the Registration Statement or of the initiation
or threat of any proceeding for that purpose; and it will promptly use its best
efforts to prevent the issuance of any stop order or to obtain its withdrawal at
the earliest possible moment if such stop order should be issued.
Notwithstanding anything to the contrary herein, the Registration Statement
shall cover only the Shares. In no event at any time before the Registration
Statement becomes effective with respect to the Shares shall the Company
publicly announce or file any other registration statement, other than
registrations on Form S-8, without the prior written consent of a majority in
interest of the Investors.
The Company understands that the Investor disclaims being an underwriter,
but the Investor being deemed an underwriter by the SEC shall not relieve the
Company of any obligations it has hereunder; provided, however that if the
-------- -------
Company receives notification from the SEC that the Investor is deemed an
underwriter, then the period by which the Company is obligated to submit an
acceleration request to the SEC shall be extended to the earlier of (i) the 90th
day after such SEC notification, or (ii) 120 days after the initial filing of
the Registration Statement with the SEC.
7.2 Transfer of Shares After Registration; Suspension.
------------------------------------------------------
(a) The Investor agrees that it will not effect any disposition
of the Shares or its right to purchase the Shares that would constitute a sale
within the meaning of the Securities Act except as contemplated in the
Registration Statement referred to in Section 7.1 and as described below or as
otherwise permitted by law, and that it will promptly notify the Company of any
changes in the information set forth in the Registration Statement regarding the
Investor or its plan of distribution.
(b) Except in the event that paragraph (c) below applies, the
Company shall (i) if deemed necessary by the Company, prepare and file from time
to time with the SEC a post-effective amendment to the Registration Statement or
a supplement to the related Prospectus or a supplement or amendment to any
document incorporated therein by reference or file any other required document
so that such Registration Statement will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and so that, as
thereafter delivered to purchasers of the Shares being sold thereunder, such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; (ii) provide the Investor copies of any documents filed pursuant
to Section 7.2(b)(i) as the Investor may reasonably request; and (iii) inform
each Investor that the Company has complied with its obligations in Section
7.2(b)(i) (or that, if the Company has filed a post-effective amendment to the
Registration Statement which has not yet been declared effective, the Company
will notify the Investor to that effect, will use its best efforts to secure the
effectiveness of such post-effective amendment as promptly as possible and will
promptly notify the Investor pursuant to Section 7.2(b)(i) hereof when the
amendment has become effective).
(c) Subject to paragraph (d) below, in the event (i) of any
request by the SEC or any other federal or state governmental authority during
the period of effectiveness of the Registration Statement for amendments or
supplements to a Registration Statement or related Prospectus or for additional
information; (ii) of the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose;
(iii) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Shares for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; or (iv) of any event or circumstance which, upon
the advice of its counsel, necessitates the making of any changes in the
Registration Statement or Prospectus, or any document incorporated or deemed to
be incorporated therein by reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; then the Company shall deliver a certificate in
writing to the Investor (the "Suspension Notice") to the effect of the foregoing
and, upon receipt of such Suspension Notice, the Investor will refrain from
selling any Shares pursuant to the Registration Statement (a "Suspension") until
the Investor's receipt of copies of a supplemented or amended Prospectus
prepared and filed by the Company, or until it is advised in writing by the
Company that the current Prospectus may be used, and has received copies of any
additional or supplemental filings that are incorporated or deemed incorporated
by reference in any such Prospectus. In the event of any Suspension, the Company
will use its best efforts to cause the use of the Prospectus so suspended to be
resumed as soon as reasonably practicable within 20 business days after the
delivery of a Suspension Notice to the Investor. In addition to and without
limiting any other remedies (including, without limitation, at law or at equity)
available to the Investor, the Investor shall be entitled to specific
performance in the event that the Company fails to comply with the provisions of
this Section 7.2(c).
(d) Notwithstanding the foregoing paragraphs of this Section 7.2,
the Investor shall not be prohibited from selling Shares under the Registration
Statement as a result of Suspensions on more than two occasions of not more
than 30 days each in any twelve month period, unless, in the good faith judgment
of the Company's Board of Directors, upon the written opinion of counsel, the
sale of Shares under the Registration Statement in reliance on this paragraph
7.2(d) would be reasonably likely to cause a violation of the Securities Act or
the Exchange Act and result in liability to the Company.
(e) Provided that a Suspension is not then in effect, the
Investor may sell Shares under the Registration Statement, provided that it
arranges for delivery of a current Prospectus to the transferee of such Shares.
Upon receipt of a request therefor, the Company has agreed to provide an
adequate number of current Prospectuses to the Investor and to supply copies to
any other parties requiring such Prospectuses.
(f) In the event of a sale of Shares by the Investor pursuant to
the Registration Statement, the Investor must also deliver to the Company's
transfer agent, with a copy to the Company, a Certificate of Subsequent Sale
substantially in the form attached hereto as Exhibit A, so that the Shares may
---------
be properly transferred.
7.3 Indemnification. For the purpose of this Section 7.3:
---------------
(i) the term "Selling Stockholder" means the Investor and any
affiliate of such Investor;
(ii) the term "Registration Statement" shall include the Prospectus in
the form first filed with the SEC pursuant to Rule 424(b) of the Securities Act
or filed as part of the Registration Statement at the time of effectiveness if
no Rule 424(b) filing is required and any exhibit, supplement or amendment
included in or relating to the Registration Statement referred to in Section
7.1; and
(iii) the term "Untrue Statement" means any untrue statement or
alleged untrue statement, or any omission or alleged omission to state in the
Registration Statement a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(a) The Company agrees to indemnify and hold harmless each
Selling Stockholder from and against any losses, claims, damages or liabilities
to which such Selling Stockholder may become subject (under the Securities Act
or otherwise) insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of, or are based upon (i) any
breach of the representations or warranties of the Company contained herein or
failure to comply with the covenants and agreements of the Company contained
herein, (ii) any Untrue Statement, or (iii) any failure by the Company to
fulfill any undertaking included in the Registration Statement as amended or
supplemented from time to time, and the Company will reimburse such Selling
Stockholder for any reasonable legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim, provided, however, that the Company shall not be liable in any such case
-------- -------
to the extent that such loss, claim, damage or liability arises out of, or is
based upon, an Untrue Statement made in reliance upon and in conformity with
written information furnished to the Company by or on behalf of such Selling
Stockholder specifically for use in preparation of the Registration Statement,
as amended or supplemented from time to time (including, without limitation,
information set forth in the Investor Questionnaire), or the failure of such
Selling Stockholder to comply with its covenants and agreements contained in
Section 7.2 hereof respecting sale of the Shares or any statement or omission in
any Prospectus that is corrected in any subsequent Prospectus that was delivered
to the Selling Stockholder prior to the pertinent sale or sales by the Selling
Stockholder. The Company shall reimburse each Selling Stockholder for the
indemnifiable amounts provided for herein on demand as such expenses are
incurred.
(b) The Investor agrees to indemnify and hold harmless the
Company (and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act, each officer of the Company who signs the
Registration Statement and each director of the Company) from and against any
losses, claims, damages or liabilities to which the Company (or any such
officer, director or controlling person) may become subject (under the
Securities Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, (i) any failure to comply with the covenants and agreements
contained in Section 7.2 hereof respecting sale of the Shares, or (ii) any
Untrue Statement if such Untrue Statement was made in reliance upon and in
conformity with written information furnished by or on behalf of the Investor
specifically for use in preparation of the Registration Statement, as amended or
supplemented from time to time (including, without limitation, information set
forth in the Investor Questionnaire), and the Investor will reimburse the
Company (or such officer, director or controlling person), as the case may be,
for any legal or other expenses reasonably incurred in investigating, defending
or preparing to defend any such action, proceeding or claim. The Investor shall
reimburse the Company or such officer, director or controlling person, as the
case may be, for the indemnifiable amounts provided for herein on demand as such
expenses are incurred. Notwithstanding the foregoing, the Investor's aggregate
obligation to indemnify the Company and such officers, directors and controlling
persons shall be limited to the net amount received by the Investor from the
sale of the Shares.
(c) Promptly after receipt by any indemnified person of a notice
of a claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 7.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, but the omission to so notify the
indemnifying person will not relieve it from any liability which it may have to
any indemnified person under this Section 7.3 (except to the extent that such
omission materially and adversely affects the indemnifying person's ability to
defend such action) or from any liability otherwise than under this Section 7.3.
Subject to the provisions hereinafter stated, in case any such action shall be
brought against an indemnified person, the indemnifying person shall be entitled
to participate therein, and, to the extent that it shall elect by written notice
delivered to the indemnified person promptly after receiving the aforesaid
notice from such indemnified person, shall be entitled to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified person. After
notice from the indemnifying person to such indemnified person of its election
to assume the defense thereof, such indemnifying person shall not be liable to
such indemnified person for any legal expenses subsequently incurred by such
indemnified person in connection with the defense thereof, provided, however,
-------- -------
that if there exists or shall exist a conflict of interest that would make it
inappropriate, in the opinion of counsel to the indemnified person, for the same
counsel to represent both the indemnified person and such indemnifying person or
any affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person; provided,
however, that no indemnifying person shall be responsible for the fees and
expenses of more than one separate counsel (together with appropriate local
counsel) for all indemnified parties. In no event shall any indemnifying person
be liable in respect of any amounts paid in settlement of any action unless the
indemnifying person shall have approved the terms of such settlement; provided
--------
that such consent shall not be unreasonably withheld or delayed. No
indemnifying person shall, without the prior written consent of the indemnified
person, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified person is or could have been a party and
indemnification could have been sought hereunder by such indemnified person,
unless such settlement includes an unconditional release of such indemnified
person from all liability on claims that are the subject matter of such
proceeding.
(d) If the indemnification provided for in this Section 7.3 is
unavailable to or insufficient to hold harmless an indemnified person under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying person shall contribute to the amount paid or payable by
such indemnified person as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Investor,
as well as any other Selling Stockholders under such Registration Statement on
the other in connection with the statements or omissions or other matters which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
fault shall be determined by reference to, among other things, in the case of an
Untrue Statement, whether the Untrue Statement relates to information supplied
by the Company on the one hand or an Investor or other Selling Stockholder on
the other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such Untrue Statement. The Company and the
Investor agree that it would not be just and equitable if contribution pursuant
to this subsection (d) were determined by pro rata allocation (even if the
Investor and other Selling Stockholders were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified person as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified person in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), the Investor shall not be required to contribute any amount in
excess of the amount by which the net amount received by the Investor from the
sale of the Shares to which such loss relates exceeds the amount of any damages
which such Investor has otherwise been required to pay by reason of such Untrue
Statement. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Investor's obligations in this subsection to contribute shall be in proportion
to its sale of Shares to which such loss relates and shall not be joint with any
other Selling Stockholders.
(e) The parties to this Agreement hereby acknowledge that they
are sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof including, without limitation, the
provisions of this Section 7.3, and are fully informed regarding said
provisions. They further acknowledge that the provisions of this Section 7.3
fairly allocate the risks in light of the ability of the parties to investigate
the Company and its business in order to assure that adequate disclosure is made
in the Registration Statement as required by the Securities Act and the Exchange
Act. The parties are advised that federal or state public policy as interpreted
by the courts in certain jurisdictions may be contrary to certain of the
provisions of this Section 7.3, and the parties hereto hereby expressly waive
and relinquish any right or ability to assert such public policy as a defense to
a claim under this Section 7.3 and further agree not to attempt to assert any
such defense.
7.4 Termination of Conditions and Obligations. The conditions
---------------------------------------------
precedent imposed by Section 5 or this Section 7 upon the transferability of the
Shares shall cease and terminate as to any particular number of the Shares when
such shares shall have been effectively registered under the Securities Act and
sold or otherwise disposed of or at such time as an opinion of counsel
reasonably satisfactory to the Company shall have been rendered to the effect
that such conditions are not necessary in order to comply with the Securities
Act.
7.5 Information Available. So long as the Registration Statement is
----------------------
effective covering the resale of Shares owned by the Investor, the Company will
furnish to the Investor upon reasonable request from the Investor:
(a) as soon as practicable after it is available, one copy of (i)
its Annual Report to Stockholders (which Annual Report shall contain financial
statements audited in accordance with generally accepted accounting principles
by a national firm of certified public accountants), (ii) its Annual Report on
Form 10-K and (iii) its Quarterly Reports on Form 10-Q (the foregoing, in each
case, excluding exhibits);
(b) all exhibits excluded by the parenthetical to subparagraph
(a) of this Section 7.5 as filed with the SEC and all other information that is
made available to shareholders; and
(c) an adequate number of copies of the Prospectuses to supply to
any other party requiring such Prospectuses; and upon the reasonable request of
the Investor, the President or the Principal Financial Officer of the Company
(or an appropriate designee thereof) will meet with the Investor or a
representative thereof at the Company's headquarters to discuss all information
relevant for disclosure in the Registration Statement covering the Shares and
will otherwise cooperate with any Investor conducting an investigation for the
purpose of reducing or eliminating such Investor's exposure to liability under
the Securities Act, including the reasonable production of information at the
Company's headquarters; provided, that the Company shall not be required to
disclose any confidential information to or meet at its headquarters with any
Investor until and unless the Investor shall have entered into a confidentiality
agreement in form and substance reasonably satisfactory to the Company with the
Company with respect thereto.
7.6 Legend; Restrictions on Transfer. The certificate or certificates
--------------------------------
for the Shares (and any securities issued in respect of or exchange for the
Shares) shall be subject to a legend or legends restricting transfer under the
Securities Act and referring to restrictions on transfer herein, such legend to
be substantially as follows:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, OR HYPOTHECATED UNLESS AND UNTIL REGISTERED
UNDER THE ACT OR, IN THE OPINION OF COUNSEL, IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR
TRANSFER OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.
7.7 Liquidated Damages. The Company and Investor agree that
-------------------
Investor will suffer damages if the Company fails to fulfill its obligations
pursuant to Section 7.1 and 7.2 hereof and that it would not be possible to
ascertain the extent of such damages with precision. Accordingly, the Company
hereby agrees to pay liquidated damages ("Liquidated Damages") to Investor under
the following circumstances: (a) if the Registration Statement is not filed by
the Company on or prior to 50 days after the Closing Date in accordance with
Section 7.1(a) (such an event, a "Filing Default"); (b) if the Registration
Statement is not declared effective by the SEC on or prior to 90 days after the
Closing Date (such an event, an "Effectiveness Default"); or (c) if the
Registration Statement (after its effectiveness date) ceases to be effective and
available to Investor for any continuous period that exceeds 30 days or for one
or more period that exceeds in the aggregate 60 days in any 12-month period
(such an event, a "Suspension Default" and together with a Filing Default and an
Effectiveness Default, a "Registration Default"). In the event of a
Registration Default, the Company shall as Liquidated Damages pay to Investor,
for each 30-day period of a Registration Default, an amount in cash equal to 1%
of the aggregate purchase price paid by Investor pursuant to this Agreement;
provided that in no event shall the aggregate amount of cash to be paid as
Liquidated Damages pursuant to this Section 7.7 exceed 9% of the aggregate
purchase price paid by Investor. The Company shall pay the Liquidated Damages
as follows: (i) in connection with a Filing Default, on the 51st day after the
Closing Date, and each 30th day thereafter until the Registration Statement is
filed with the SEC; (ii) in connection with an Effectiveness Default, on the
91st day after the Closing Date, and each 30th day thereafter until the
Registration Statement is declared effective by the SEC; or (iii) in connection
with a Suspension Default, on either (x) the 31st consecutive day of any
Suspension or (y) the 61st day (in the aggregate) of any Suspensions in any
12-month period, and each 30th day thereafter until the Suspension is terminated
in accordance with Section 7.2. Notwithstanding the foregoing, all periods
shall be tolled during delays directly caused by the action or inaction of any
Investor, and the Company
shall have no liability to any Investor in respect of any such delay. The
Liquidated Damages payable herein shall apply on a pro rata basis for any
portion of a 30-day period of a Registration Default.
8. Notices. All notices, requests, consents and other communications
-------
hereunder shall be in writing, shall be mailed (A) if within the United States
by first-class registered or certified airmail, or nationally recognized
overnight express courier, postage prepaid, or by facsimile, or (B) if delivered
from outside the United States, by International Federal Express (or other
recognized international express courier) or facsimile, and shall be deemed
given (i) if delivered by first-class registered or certified mail, three
business days after so mailed, (ii) if delivered by nationally recognized
overnight carrier, one business day after so mailed, (iii) if delivered by
International Federal Express (or other recognized international express
courier), two business days after so mailed, (iv) if delivered by facsimile,
upon electronic confirmation of receipt and shall be delivered as addressed as
follows:
(a) if to the Company, to:
LifeCell Corporation
Xxx Xxxxxxxxxx Xxx
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
(b) with a copy to:
Xxxxxxxxxx Xxxxxxx PC
00 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
(c) if to the Investor, at its address on the signature page hereto, or at
such other address or addresses as may have been furnished to the
Company in writing.
9. Changes. This Agreement may be modified, amended or waived only
-------
pursuant to a written instrument signed by the Company and (a) Investors holding
a majority of the Shares issued and sold in the Offering, provided that such
modification, amendment or waiver is made with respect to all Agreements and
does not adversely affect the Investor without adversely affecting all Investors
in a similar manner; or (b) the Investor.
10. Headings. The headings of the various sections of this Agreement
--------
have been inserted for convenience of reference only and shall not be deemed to
be part of this Agreement.
11. Severability. In case any provision contained in this Agreement
------------
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
12. Governing Law. This Agreement shall be governed by, and construed
--------------
in accordance with, the internal laws of the State of New Jersey, without giving
effect to the principles of conflicts of law.
13. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.
14. Entire Agreement. This Agreement constitute the entire agreement
-----------------
between the parties hereto and supersedes any prior understandings or agreements
concerning the purchase and sale of the Shares and the resale registration of
the Shares.
15. Rule 144. The Company covenants that it will timely file the reports
---------
required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations adopted by the SEC thereunder (or, if the Company is not
required to file such reports, it will, upon the request of any Investor holding
Shares purchased hereunder made after the first anniversary of the Closing Date,
make publicly available such information as necessary to permit sales pursuant
to Rule 144 under the Securities Act), and it will take such further action as
any such Investor may reasonably request, all to the extent required from time
to time to enable such Investor to sell such Shares without registration under
the Securities Act within the limitation of the exemptions provided by (a) Rule
144 under the Securities Act, as such Rule may be amended from time to time, or
(b) any similar rule or regulation hereafter adopted by the SEC. Upon the
request of the Investor, the Company will deliver to such holder a written
statement as to whether it has complied with such information and requirements.
16. Confidential Information.
-------------------------
(a) The Investor represents to the Company that, at all times during
the Company's offering of the Shares, the Investor has maintained in confidence
all non-public information regarding the Company received by the Investor from
the Company or its agents, and covenants that it will continue to maintain in
confidence such information until such information (a) becomes generally
publicly available other than through a violation of this provision by the
Investor or its agents or (b) is required to be disclosed in legal proceedings
(such as by deposition, interrogatory, request for documents, subpoena, civil
investigation demand, filing with any governmental authority or similar
process), provided, however, that before making any use or disclosure in
reliance on this subparagraph (b) the Investor shall give the Company at least
fifteen (15) days prior written notice (or such shorter period as required by
law) specifying the circumstances giving rise thereto and will furnish only that
portion of the non-public information which is legally required and will
exercise its best efforts to obtain reliable assurance that confidential
treatment will be accorded any non-public information so furnished.
(b) The Company shall on the Closing Date issue a press release
disclosing the material terms of the transactions contemplated hereby (including
at least the number of Shares sold and proceeds therefrom). The Company shall
not publicly disclose the name of Investor, or include the name of Investor in
any filing with the SEC or any regulatory agency or the Nasdaq (other than the
filing of the Agreements with the SEC pursuant to the Exchange Act and in the
Registration Statement), without the prior written consent of Investor, except
to the extent such disclosure is required by law or Nasdaq regulations.
17. No Third-Party Beneficiaries. This Agreement is intended for the
------------------------------
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.
LIFECELL CORPORATION
INVESTOR QUESTIONNAIRE
(ALL INFORMATION WILL BE TREATED CONFIDENTIALLY)
To: LifeCell Corporation
Xxx Xxxxxxxxxx Xxx
Xxxxxxxxxx, XX 00000-0000
This Investor Questionnaire ("Questionnaire") must be completed by each
potential investor in connection with the offer and sale of the shares of the
common stock, par value $0.001 per share, of LifeCell Corporation (the
"Securities"). The Securities are being offered and sold by LifeCell
Corporation (the "Corporation") without registration under the Securities Act of
1933, as amended (the "Act"), and the securities laws of certain states, in
reliance on the exemptions contained in Section 4(2) of the Act and on
Regulation D promulgated thereunder and in reliance on similar exemptions under
applicable state laws. The Corporation must determine that a potential investor
meets certain suitability requirements before offering or selling Securities to
such investor. The purpose of this Questionnaire is to assure the Corporation
that each investor will meet the applicable suitability requirements. The
information supplied by you will be used in determining whether you meet such
criteria, and reliance upon the private offering exemption from registration is
based in part on the information herein supplied.
This Questionnaire does not constitute an offer to sell or a solicitation
of an offer to buy any security. Your answers will be kept strictly
confidential. However, by signing this Questionnaire you will be authorizing
the Corporation to provide a completed copy of this Questionnaire to such
parties as the Corporation deems appropriate in order to ensure that the offer
and sale of the Securities will not result in a violation of the Act or the
securities laws of any state and that you otherwise satisfy the suitability
standards applicable to purchasers of the Securities. All potential investors
must answer all applicable questions and complete, date and sign this
Questionnaire. Please print or type your responses and attach additional sheets
of paper if necessary to complete your answers to any item.
A. BACKGROUND INFORMATION
-----------------------
Name:
---------------------------------------------------------------------------
Business Address:
--------------------------------------------------------------
(Number and Street)
--------------------------------------------------------------------------------
(City) (State) (Zip Code)
Telephone Number: (___)
--------------------------------------------------------
Residence Address:
-------------------------------------------------------------
(Number and Street)
--------------------------------------------------------------------------------
(City) (State) (Zip Code)
Telephone Number: (___)
--------------------------------------------------------
If an individual:
Age: Citizenship: Where registered to vote:
--------- --------- --------
If a corporation, partnership, limited liability company, trust or other entity:
Type of entity:
----------------------------------------------------------
State of formation: Date of formation:
--------------------- ---------
Social Security or Taxpayer Identification No.
----------------------------------
Send all correspondence to (check one): Residence Address
-----
Business Address
-----
Current ownership of securities of the Corporation:
____________ shares of common stock, par value $0.001 per share (the
"Common Stock")
____________ shares of Series B Preferred Stock, $0.001 par value per share
options or warrants to purchase __________ shares of Common Stock
B. STATUS AS ACCREDITED INVESTOR
--------------------------------
The undersigned is an "accredited investor" as such term is defined in
Regulation D under the Act, as at the time of the sale of the Securities the
undersigned falls within one or more of the following categories (Please initial
--------------
one or more, as applicable): (1)
------------------------------
____ (1) a bank as defined in Section 3(a)(2) of the Act, or a savings
and loan association or other institution as defined in Section 3(a)(5)(A) of
the Act whether acting in its individual or fiduciary capacity; a broker or
dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934;
an insurance company as defined in Section 2(13) of the Act; an investment
company registered under the Investment Corporation Act of 1940 or a business
development company as defined in Section 2(a)(48) of that Act; a Small Business
Investment Corporation licensed by the U.S. Small Business Administration under
Section 301(c) or (d) of the Small Business Investment Act of 1958; a plan
established and maintained by a state, its political subdivisions, or any agency
or instrumentality of a state or its political subdivisions for the benefit of
its employees, if such plan has total assets in excess of $5,000,000; an
employee benefit plan within the meaning of the Employee Retirement Income
Security Act of 1974 if the investment decision is made by a plan fiduciary, as
defined in Section 3(21) of such Act, which is either a bank, savings and loan
association, insurance company, or registered investment adviser, or if the
employee benefit plan has total assets in excess of $5,000,000 or, if a
self-directed plan, with the investment decisions made solely by persons that
are accredited investors;
____ (2) a private business development company as defined in Section
202(a)(22) of the Investment Adviser Act of 1940;
____ (3) an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended, corporation, Massachusetts or similar
business trust, or partnership, not formed for the specific purpose of acquiring
the Securities offered, with total assets in excess of $5,000,000;
____ (4) a natural person whose individual net worth, or joint net
worth with that person's spouse, at the time of such person's purchase of the
Securities exceeds $1,000,000;
____ (5) a natural person who had an individual income in excess of
$200,000 in each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the current year;
____ (6) a trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the Securities offered, whose
purchase is directed by a sophisticated person as described in Rule
506(b)(2)(ii) of Regulation D; and
____ (7) an entity in which all of the equity owners are accredited
investors (as defined above).
---------------
(1) As used in this Questionnaire, the term "net worth" means the excess
of total assets over total liabilities. In computing net worth for the purpose
of subsection (4), the principal residence of the investor must be valued at
cost, including cost of improvements, or at recently appraised value by an
institutional lender making a secured loan, net of encumbrances. In determining
income, the investor should add to the investor's adjusted gross income any
amounts attributable to tax exempt income received, losses claimed as a limited
partner in any limited partnership, deductions claimed for depiction,
contributions to an XXX or XXXXX retirement plan, alimony payments, and any
amount by which income from long-term capital gains has been reduced in arriving
at adjusted gross income.
C. REPRESENTATIONS
---------------
The undersigned hereby represents and warrants to the Corporation as
follows:
1. Any purchase of the Securities would be solely for the account of the
undersigned and not for the account of any other person or with a view to
any resale, fractionalization, division, or distribution thereof.
2. The information contained herein is complete and accurate and may be relied
upon by the Corporation, and the undersigned will notify the Corporation
immediately of any material change in any of such information occurring
prior to the closing, if any, with respect to the purchase of Securities by
the undersigned or any co-purchaser.
3. There are no suits, pending litigation, or claims against the undersigned
that could materially affect the net worth of the undersigned as reported
in this Questionnaire.
4. The undersigned acknowledges that there may occasionally be times when the
Corporation determines that it must suspend the use of the Prospectus
forming a part of the Registration Statement (as such terms are defined in
the Stock Purchase Agreement to which this Questionnaire is attached), as
set forth in Section 7.2(c) of the Stock Purchase Agreement. The
undersigned is aware that, in such event, the Securities will not be
subject to ready liquidation, and that any Securities purchased by the
undersigned would have to be held during such suspension. The overall
commitment of the undersigned to investments which are not readily
marketable is not excessive in view of the undersigned's net worth and
financial circumstances, and any purchase of the Securities will not cause
such commitment to become excessive. The undersigned is able to bear the
economic risk of an investment in the Securities.
5. The undersigned has carefully considered the potential risks relating to
the Corporation and a purchase of the Securities, and fully understands
that the Securities are speculative investments which involve a high degree
of risk of loss of the undersigned's entire investment. Among others, the
undersigned has carefully considered each of the risks identified in the
Exchange Act Documents.
IN WITNESS WHEREOF, the undersigned has executed this Questionnaire
this _____ day of _______, 2003, and declares under oath that it is
truthful and correct.
---------------------------------------------
Print Name
By:
------------------------------------------
Signature
Title:
---------------------------------------
(required for any purchaser that
is a corporation, partnership, trust
or other entity)
[COMPANY LETTERHEAD]
_________, 200_
Re: LifeCell Corporation; Registration Statement on Form S-3
--------------------------------------------------------
Dear Selling Stockholder:
Enclosed please find five (5) copies of a prospectus dated ______________,
____ (the "Prospectus") for your use in reselling your shares of common stock,
----------
$0.001 par value (the "Shares"), of LifeCell Corporation (the "Company"), under
------ -------
the Company's Registration Statement on Form S-3 (Registration No. 333- )
(the "Registration Statement"), which has been declared effective by the
-----------------------
Securities and Exchange Commission. AS A SELLING STOCKHOLDER UNDER THE
REGISTRATION STATEMENT, YOU HAVE AN OBLIGATION TO DELIVER A COPY OF THE
PROSPECTUS TO EACH PURCHASER OF YOUR SHARES, EITHER DIRECTLY OR THROUGH THE
BROKER-DEALER WHO EXECUTES THE SALE OF YOUR SHARES.
The Company is obligated to notify you in the event that it suspends
trading under the Registration Statement in accordance with the terms of the
Stock Purchase Agreement between the Company and you. During the period that
the Registration Statement remains effective and trading thereunder has not been
suspended, you will be permitted to sell your Shares which are included in the
Prospectus under the Registration Statement. Upon a sale of any Shares under
the Registration Statement, you or your broker will be required to deliver to
the Transfer Agent, Computershare Investor Services, LLC (1) your restricted
stock certificate(s) representing the Shares, (2) instructions for transfer of
the Shares sold, and (3) a representation letter from your broker, or from you
if you are selling in a privately negotiated transaction, or from such other
appropriate party, in the form of Exhibit A attached hereto (the "Representation
---------
Letter"). The Representation Letter confirms that the Shares have been sold
pursuant to the Registration Statement and in a manner described under the
caption "Plan of Distribution" in the Prospectus and that such sale was made in
accordance with all applicable securities laws, including the prospectus
delivery requirements.
Please note that you are under no obligation to sell your Shares during the
registration period. However, if you do decide to sell, you must comply with
the requirements described in this letter or otherwise applicable to such sale.
Your failure to do so may result in liability under the Securities Act of 1933,
as amended, and the Securities Exchange Act of 1934, as amended. Please
remember that all sales of your Shares must be carried out in the manner set
forth under the caption "Plan of Distribution" in the Prospectus if you sell
under the Registration Statement. The Company may require an opinion of counsel
reasonably satisfactory to the Company if you choose another method of sale.
YOU SHOULD CONSULT WITH YOUR OWN LEGAL ADVISOR(S) ON AN ONGOING BASIS TO ENSURE
YOUR COMPLIANCE WITH THE RELEVANT SECURITIES LAWS AND REGULATIONS.
IN ORDER TO MAINTAIN THE ACCURACY OF THE PROSPECTUS, YOU MUST NOTIFY THE
UNDERSIGNED UPON THE SALE, GIFT, OR OTHER TRANSFER OF ANY SHARES BY YOU,
INCLUDING THE NUMBER OF SHARES BEING TRANSFERRED, AND IN THE EVENT OF ANY OTHER
CHANGE IN THE INFORMATION REGARDING YOU WHICH IS CONTAINED IN THE PROSPECTUS.
FOR EXAMPLE, YOU MUST NOTIFY THE UNDERSIGNED IF YOU ENTER INTO ANY ARRANGEMENT
WITH A BROKER-DEALER FOR THE SALE OF SHARES THROUGH A BLOCK TRADE, SPECIAL
OFFERING, EXCHANGE DISTRIBUTION OR SECONDARY DISTRIBUTION OR A PURCHASE BY A
BROKER-DEALER. DEPENDING ON THE CIRCUMSTANCES, SUCH TRANSACTIONS MAY REQUIRE
THE FILING OF A SUPPLEMENT TO THE PROSPECTUS IN ORDER TO UPDATE THE INFORMATION
SET FORTH UNDER THE CAPTION "PLAN OF DISTRIBUTION" IN THE PROSPECTUS.
Should you need any additional copies of the Prospectus, or if you have any
questions concerning the foregoing, please write to me at LifeCell Corporation,
Xxx Xxxxxxxxxx Xxx, Xxxxxxxxxx, Xxx Xxxxxx 00000-0000. Thank you.
Sincerely,
Principal Financial Officer
Exhibit A
---------
CERTIFICATE OF SUBSEQUENT SALE
------------------------------
Computershare Investor Services, LLC
0 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
RE: Sale of Shares of Common Stock of LifeCell Corporation (the
"Company") pursuant to the Company's Prospectus dated
_____________, 2003 (the "Prospectus")
Dear Sir/Madam:
The undersigned hereby certifies, in connection with the sale of shares of
Common Stock of the Company included in the table of Selling Stockholders in the
Prospectus, that the undersigned has sold the shares pursuant to the Prospectus
and in a manner described under the caption "Plan of Distribution" in the
Prospectus and that such sale complies with all securities laws applicable to
the undersigned, including, without limitation, the Prospectus delivery
requirements of the Securities Act of 1933, as amended.
Selling Stockholder (the beneficial owner):
-------------------------------------
Record Holder (e.g., if held in name of nominee):
-------------------------------
Restricted Stock Certificate No.(s):
--------------------------------------------
Number of Shares Sold:
----------------------------------------------------------
Date of Sale:
-------------------------------------------------------------------
In the event that you receive a stock certificate(s) representing more
shares of Common Stock than have been sold by the undersigned, then you should
return to the undersigned a newly issued certificate for such excess shares in
the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you
should place a stop transfer on your records with regard to such certificate.
Very truly yours,
Dated: By:
---------------------------- ---------------------------------
Print Name:
-------------------------
Title:
------------------------------
cc: LifeCell Corporation
Xxx Xxxxxxxxxx Xxx
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
Attn: Principal Financial Officer
