COMMON STOCK AND WARRANT PURCHASE AGREEMENT
This Common Stock and Warrant Purchase Agreement (this "AGREEMENT"), dated April
8, 2004 (the "AGREEMENT DATE"), is between ADVENTRX Pharmaceuticals, Inc., a
Delaware corporation (the "COMPANY"), and CD Investment Partners, Ltd. (the
"INVESTOR").
1. SUBSCRIPTION.
(a) SHARES OF COMMON STOCK. On the terms and subject to the conditions set
forth in this Agreement, at the Closing (as defined below), the Company will
sell and the Investor will purchase two hundred fifty thousand (250,000) shares
of Common Stock, par value $0.001 per share, of the Company ("COMMON STOCK") at
a purchase price of $1.50 per share (the "SHARE PRICE"). For purposes of this
Agreement, the term "SHARES" refers to the shares of Common Stock purchased by
the Investor pursuant to this Agreement.
(b) WARRANTS. In consideration of the Investor's purchase of the Shares,
the Company shall also issue to the Investor (i) a warrant, in the form of
Exhibit A-1 hereto, to purchase seventy-five thousand (75,000) shares of Common
Stock and (ii) a warrant, in the form of Exhibit A-2 hereto, to purchase fifty
thousand (50,000) shares of Common Stock (an "A-2 WARRANT"). The A-1 Warrants
and A-2 Warrants issuable to the Investor pursuant to this Agreement are
collectively referred to herein as the "WARRANTS."
2. CLOSING; CONDITIONS TO CLOSING.
(a) CLOSING. The closing of the purchase and sale of the Shares and the
issuance of the Warrants (the "CLOSING") will take place as promptly as
practicable, but no later than five business days after satisfaction or waiver
of all of the conditions set forth in Sections 2(c) and (d) (other than those
conditions which by their terms are not to be satisfied or waived until the
Closing), at the offices of the Company's Counsel (as defined herein), located
at 0 Xxxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000-0000. The date on which the
Closing occurs is referred to herein as the "CLOSING DATE" (it is understood and
agreed that the Closing Date shall be the Agreement Date).
(b) DELIVERY OF PURCHASE PRICE. The Investor shall deliver or cause to be
delivered to the Company by wire transfer of immediately available funds an
amount in cash equal to $375,000 (the "PURCHASE PRICE").
(c) CONDITIONS TO OBLIGATIONS OF THE INVESTOR TO EFFECT THE CLOSING. The
obligations of the Investor to effect the Closing and the transactions
contemplated by this Agreement shall be subject to the satisfaction at or prior
to the Closing, of each of the following conditions, any of which may be waived,
in writing, by the Investor:
(i) The Company shall deliver or cause to be delivered to the Investor
the following:
(1) A copy of the letter to be delivered to the Company's transfer
agent containing irrevocable instructions to issue a certificate
evidencing the Shares, registered in the name of the Investor (it
being understood and agreed that the original of such letter shall
be delivered to the transfer agent upon the Company's receipt of
the Purchase Price);
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(2) The Registration Rights Agreement in the form of Exhibit B
hereto (the "REGISTRATION RIGHTS AGREEMENT") executed by the
Company;
(3) The Warrants, each registered in the name of the Investor and
executed by the Company;
(4) A legal opinion of Xxxxxxx XxXxxxxxx LLP ("COMPANY'S
COUNSEL"), counsel to the Company, in the form attached hereto as
Exhibit C;
(5) A certificate signed by an officer of the Company either (i)
evidencing that the Company has applied to each U.S. securities
exchange, interdealer quotation system and other trading market
where its Common Stock is currently listed or qualified for
trading or quotation for the listing or qualification of the
Shares and the Warrant Shares for trading or quotation thereon or
(ii) certifying that no such application is necessary for the
listing of such shares; and
(6) Simultaneously with or prior to the Closing Date, the Company
shall have sold securities to third party purchasers, who are not
acting in concert with the Investor, for an aggregate amount of a
minimum of seven million dollars ($7,000,000). The securities sold
to any such third party purchaser shall be on, and have, such
terms and conditions as the Company shall determine in its sole
discretion.
(d) CONDITIONS TO OBLIGATIONS OF THE COMPANY TO EFFECT THE CLOSING. The
obligations of the Company to effect the Closing and the transactions
contemplated by this Agreement shall be subject to the satisfaction at or prior
to the Closing of each of the following conditions, any of which may be waived,
in writing, by the Company:
(i) The Investor shall have executed and delivered to the Company
this Agreement;
(ii) The Investor shall have executed and delivered to the Company the
Registration Rights Agreement;
(iii)The Investor shall have executed and delivered to the Company the
Investor Suitability Questionnaire attached hereto as Exhibit D and
the Company shall be reasonably satisfied, through the responses of
the Investor, that the sale of the Shares and the Warrants shall not
require registration thereof under the Securities Act of 1933, as
amended (the "SECURITIES ACT") or under the blue sky or securities
laws of any jurisdiction;
(iv) The Investor shall have delivered the Purchase Price to the
Company; and
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(v) Simultaneously with or prior to the Closing Date, the Company
shall have sold securities (the "Contemporaneous Offering") to third
party purchasers, who are not acting in concert with the Investor, for
an aggregate amount of a minimum of seven million dollars
($7,000,000). The securities sold to any such third party purchaser
shall be on, and have, such terms and conditions as the Company shall
determine in its sole discretion.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants as of the Agreement Date to the Investor that, except as set forth
on the Disclosure Schedule attached as Schedule 3:
(a) CORPORATE EXISTENCE AND POWER; SUBSIDIARIES. The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the state in which it is incorporated, and has all corporate powers
required to carry on its business as now conducted. The Company is duly
qualified to do business as a foreign corporation and is in good standing in
each jurisdiction where the character of the property owned or leased by it or
the nature of its activities makes such qualification necessary, except for
those jurisdictions where the failure to be so qualified would not have a
Material Adverse Effect. For purposes of this Agreement, the term "MATERIAL
ADVERSE EFFECT" means, with respect to the Company, a material adverse effect on
the Company's condition (financial or other), business, properties, assets,
liabilities (including contingent liabilities), results of operations or current
prospects, taken as a whole. True and complete copies of the Company's
Certificate of Incorporation, as amended (the "CERTIFICATE"), and Bylaws, as
amended (the "BYLAWS"), as currently in effect and as will be in effect on the
Closing Date, have previously been made available to the Investor. For purposes
of this Agreement, the term "SUBSIDIARY" or "SUBSIDIARIES" means, with respect
to any entity, any corporation or other organization of which securities or
other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are
directly or indirectly owned by such entity or of which such entity is a partner
or is, directly or indirectly, the beneficial owner of 50% or more of any class
of equity securities or equivalent profit participation interests. The Company
has no Subsidiaries.
(b) CORPORATE AUTHORIZATION. The execution, delivery and performance by
the Company of this Agreement, the Registration Rights Agreement, the Warrants
and each of the other documents executed by the Company pursuant to and in
connection with this Agreement (collectively, the "TRANSACTION AGREEMENTS"), and
the consummation of the transactions contemplated hereby and thereby (including,
but not limited to, the sale and delivery of the Shares and the Warrants to the
Investor and the subsequent issuance of the Warrant Shares to the Investor upon
exercise of the Warrants) (the "TRANSACTIONS") have been (and will be, in the
case of the issuance of the Warrant Shares) duly authorized, and no additional
corporate or stockholder action is required for the approval thereof. The shares
issuable upon exercise of the Warrants (the "WARRANT SHARES") have been duly
reserved for issuance by the Company. The Transaction Agreements have been or,
to the extent contemplated hereby or by the Transaction Agreements, will be duly
executed and delivered and constitute the legal, valid and binding agreement of
the Company, enforceable against the Company in accordance with their terms,
except as may be limited by bankruptcy, reorganization, insolvency, moratorium
and similar laws of general application relating to or affecting the enforcement
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of rights of creditors, and except as enforceability of its obligations
hereunder are subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
(c) NON-CONTRAVENTION. The execution, delivery and performance by the
Company of the Transaction Agreements, and the consummation by the Company of
the Transactions do not and will not (a) violate any term of the Certificate,
the Bylaws or any material agreement to which the Company is a party or by which
it is bound; (b) constitute a violation of any provision of any law, regulation,
judgment, injunction, order or decree binding upon or applicable to the Company;
(c) constitute a default (or would constitute a default with notice or lapse of
time or both) or breach under or give rise to a right of termination,
cancellation or acceleration or loss of any benefit under any material
agreement, contract or other instrument binding upon the Company or under any
material license, franchise, permit or other similar authorization held by the
Company; or (d) result in the creation or imposition of any Lien (as defined
below) on any asset of the Company. For purposes of this Agreement, the term
"LIEN" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest, claim or encumbrance of any kind in respect of such asset.
(d) SEC DOCUMENTS. The Company is obligated under the Securities Exchange
Act of 1934, as amended (the "EXCHANGE ACT"), to file reports pursuant to
Sections 13 or 15(d) thereof (all such reports filed or required to be filed by
the Company with the Securities and Exchange Commission (the "COMMISSION"),
including all exhibits thereto or incorporated therein by reference, and all
documents filed by the Company under the Securities Act, hereinafter called the
"SEC DOCUMENTS"). Since December 31, 2002, the Company has timely filed all SEC
Documents required to be filed under the Exchange Act. All SEC Documents filed
on or after October 31, 2000 (i) were prepared in all material respects in
accordance with the requirements of the Exchange Act and (ii) did not at the
time they were filed (or, if amended or superseded by a filing prior to the
Agreement Date, then on the date of such filing) contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. A correct and complete
copy of each of the SEC Documents for any period ending on or after December 31,
2002 (the "RECENT REPORTS") is currently available to the Investor at the
Commission's main public website at
xxxx://xxx.xxx.xxx/xxx-xxx/xxxxxx-xxxxx?xxxxxxxxxxxxxxxxxxxxxxx&XXXx&
filenum=&State=&SIC=&owner=include&action=getcompany. None of the information
about the Company or any of its Subsidiaries which has been disclosed to the
Investor herein or in the course of discussions and negotiations with respect
hereto which is not disclosed in the Recent Reports is or was required to be so
disclosed. There is no information which has not been publicly disclosed which,
in the good faith judgment of the Company, would cause a reasonable investor to
not make the investment contemplated hereby.
(e) FINANCIAL STATEMENTS. Each of the Company's audited consolidated
balance sheet and related consolidated statements of income, cash flows and
changes in stockholders' equity (including the related notes) as of and for the
years ended December 31, 2003 and December 31, 2002, as contained in the Recent
Reports (both of (i) and (ii), collectively, the "FINANCIAL STATEMENTS") (x)
present fairly in all material respects the financial position of the Company
and its Subsidiaries on a consolidated basis as of the dates thereof and the
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results of operations, cash flows and stockholders' equity as of and for each of
the periods then ended and (y) were prepared in accordance with United States
generally accepted accounting principals ("GAAP") applied on a consistent basis
throughout the periods involved, in each case, except as otherwise indicated in
the notes thereto.
(f) COMPLIANCE WITH LAW. The Company is in compliance and has conducted
its business so as to comply with all laws, rules and regulations, judgments,
decrees or orders of any court, administrative agency, commission, regulatory
authority or other governmental authority or instrumentality, domestic or
foreign, applicable to its operations, the violation of which would cause a
Material Adverse Affect. There are no judgments or orders, injunctions, decrees,
stipulations or awards (whether rendered by a court or administrative agency or
by arbitration), including any such actions relating to affirmative action
claims or claims of discrimination, against the Company or against any of its
properties or businesses.
(g) ABSENCE OF CERTAIN CHANGES. Since December 31, 2003, the Company has
conducted its business only in the ordinary course and there has not occurred,
except as set forth in the Recent Reports or any exhibit thereto or incorporated
by reference therein, any event that could reasonably be expected to have a
Material Adverse Effect on the Company or any of its Subsidiaries.
(h) NO UNDISCLOSED LIABILITIES. Except as set forth in the Recent Reports,
and except for liabilities and obligations incurred in the ordinary course of
business since December 31, 2003, as of the Agreement Date, to the Company's
knowledge, (i) the Company does not have any material liabilities or obligations
(absolute, accrued, contingent or otherwise) which, and (ii) there has not been
any aspect of the prior or current conduct of the business of the Company or its
Subsidiaries which may form the basis for any material claim by any third party
which, in each case, if asserted could result in any such material liabilities
or obligations which are not fully reflected, reserved against or disclosed in
the balance sheet of the Company as at December 31, 2003.
(i) CAPITALIZATION. The authorized capital stock of the Company consists
of 100,000,000 shares of Common Stock of which 42,833,830 shares are issued and
42,810,665 are outstanding as of the Agreement Date and 1,000,000 shares of
preferred stock, par value $0.01 per share, of which none are issued and
outstanding as of the Agreement Date. All issued and outstanding shares of the
Company's capital stock have been duly authorized and were validly issued, and
are fully paid and nonassessable. No securities issued by the Company from
October 31, 2000 to the date hereof were issued in violation of any statutory or
common law preemptive rights. Upon issuance pursuant to the terms of this
Agreement or the Warrants, as the case may be, all Shares and Warrant Shares
shall be duly authorized, validly issued and outstanding, and fully paid and
nonassessable and such shares shall not have been issued in violation of any
statutory or contractual preemptive rights. There are no dividends which have
accrued or been declared but are unpaid on the capital stock of the Company. All
taxes required to be paid by Company in connection with the issuance and any
transfers of the Company's capital stock have been paid. All permits or
authorizations required to be obtained from or registrations required to be
effected with any person or entity in connection with any and all issuances of
securities of the Company from October 31, 2000 through the Agreement Date have
been obtained or effected, and all securities of the Company have been issued
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and are held in accordance with the provisions of all applicable securities or
other laws. A true and complete capitalization table of the Company as of the
date hereof is set forth in Schedule 3(i). No shares of capital stock of the
Company are subject to preemptive rights or any other similar rights of the
stockholders of the Company or any liens or encumbrances imposed through the
actions or failure to act of the Company. Except as disclosed in Schedule 3(i),
as of the Agreement Date, (i) there are no outstanding options, warrants, scrip,
rights to subscribe for, puts, calls, rights of first refusal, agreements,
understandings, claims or other commitments or rights of any character
whatsoever relating to, or securities or rights convertible into or exchangeable
for any shares of capital stock of the Company, or arrangements by which the
Company is or may become bound to issue additional shares of capital stock of
the Company, (ii) there are no agreements or arrangements under which the
Company is obligated to register the sale of any of its securities under the
Securities Act, other than as contemplated by the Contemporaneous Offering and
(iii) there are no anti-dilution or price adjustment provisions contained in any
security issued by the Company (or in any agreement providing rights to security
holders) that will be triggered by the issuance of the Shares, Warrants or
Warrant Shares (including the issuance of the Warrant Shares upon exercise of
the Warrants).
(j) GOVERNMENT AUTHORIZATIONS. Except as disclosed in the Recent Reports,
the Company holds all material authorizations, consents, approvals, franchises,
licenses and permits required under applicable law or regulation for the
operation of the business of the Company as presently operated (the
"GOVERNMENTAL AUTHORIZATIONS"). All the Governmental Authorizations have been
duly issued or obtained and are in full force and effect, and the Company is in
material compliance with the terms of all the Governmental Authorizations. The
Company has not engaged in any activity that, to its knowledge, would cause
revocation or suspension of any such Governmental Authorizations. The Company
has no knowledge of any facts which could reasonably be expected to cause the
Company to believe that the Governmental Authorizations will not be renewed by
the appropriate governmental authorities in the ordinary course. Neither the
execution, delivery nor performance of this Agreement shall adversely affect the
status of any of the Governmental Authorizations.
(k) BROKERS. No broker, finder or investment banker is entitled to any
brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement, based upon any arrangement made by
or on behalf of the Company, which would make the Company or the Investor liable
for any fees or commissions.
(l) SECURITIES LAWS. Neither the Company nor any agent acting on behalf of
the Company has taken any action (or will take any action, in the case of the
Warrant Shares) which might cause this Agreement or the Shares or Warrants (or
the Warrant Shares, as the case may be) to violate the Securities Act or the
Exchange Act or any rules or regulations promulgated thereunder, as in effect on
the Closing Date. Assuming that all of the representations and warranties of the
Investor set forth in Section 4 are true and correct, the offer, sale and
issuance of the Shares and Warrants in conformity with the terms of this
Agreement are (and, assuming there is no material change in the securities laws
of the United States, the issuance of the Warrant Shares in conformity with the
terms of the Warrants will be) exempt from the registration requirements of
Section 5 of the Securities Act and from the qualification or registration
requirements of applicable "blue sky" laws.
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(m) ISSUANCE OF SHARES. The Shares are duly authorized and, upon issuance
in accordance with the terms of this Agreement will be validly issued, fully
paid, and non-assessable and free from all taxes, liens, claims and encumbrances
with respect to the issue thereof and shall not be subject to preemptive rights
or other similar rights of stockholders of the Company and will not impose
personal liability on the holder thereof. The Warrant Shares are duly authorized
and reserved for issuance, and, when issued upon exercise of or otherwise
pursuant to the Warrants, respectively, in accordance with the terms thereof,
will be validly issued, fully paid and non-assessable, and free from all taxes,
liens, claims and encumbrances and will not be subject to preemptive rights or
other similar rights of stockholders of the Company and will not impose personal
liability upon the holder thereof.
(n) INTERNAL ACCOUNTING CONTROLS. The Company maintains a system of
internal accounting controls sufficient, in the judgment of the Company's board
of directors, to provide reasonable assurance 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 conformity 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.
(o) NO INVESTMENT COMPANY. The Company is not, and upon the issuance and
sale of the Shares and Warrants as contemplated by this Agreement will not be,
an "investment company" required to be registered under the Investment Company
Act of 1940 (an "INVESTMENT COMPANY"). The Company is not controlled by an
Investment Company.
(p) XXXXXXXX-XXXXX ACT. The Company is in substantial compliance with the
applicable provisions of the Xxxxxxxx-Xxxxx Act of 2002 (the "XXXXXXXX-XXXXX
ACT"), and the rules and regulations promulgated thereunder, that are effective
and intends to comply substantially with other applicable provisions of the
Xxxxxxxx-Xxxxx Act, and the rules and regulations promulgated thereunder, upon
the effectiveness of such provisions.
(q) INDEPENDENT NATURE OF THE INVESTOR. The Company acknowledges that the
obligations of the Investor under the Transaction Agreements are several and not
joint with the obligations of any other third party purchasers of the Company's
securities, and the Investor shall not be responsible in any way for the
performance of the obligations of any other third party purchasers of the
Company's securities. Each of the Investor and the Company agrees and
acknowledges that (i) the decision of the Investor to purchase the Shares and
the Warrants pursuant to this Agreement has been made (and the decision of the
Investor to purchase the Warrant Shares pursuant to the terms of the Warrant
will be made) by the Investor independently of any other third party purchasers
of the Company's securities and (ii) no other third party purchasers of the
Company's securities have acted as agent for the Investor in connection with the
Investor making its investment hereunder and that no such other third party
purchasers will be acting as agent of the Investor in connection with monitoring
its investment hereunder. Nothing contained herein or in any other Transaction
Agreement or any agreement of any such other third party purchaser, and no
action taken by the Investor pursuant hereto or any other third party purchaser
pursuant thereto, shall be deemed to constitute the Investor or any such other
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third party purchasers as a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Investor or any such
other third party purchasers are in any way acting in concert or as a group with
respect to any matters. The Investor shall be entitled to independently protect
and enforce its rights, including without limitation, the rights arising out of
this Agreement or out of any of the other Transaction Agreements, and it shall
not be necessary for any such other third party purchasers to be joined as an
additional party in any proceeding for such purpose. To the extent that any such
other third party purchasers purchase the same or similar securities as the
Investor hereunder or on the same or similar terms and conditions or pursuant to
the same or similar documents, all such matters are solely in the control of the
Company, not the action or decision of the Investor and are not done with the
knowledge of the Investor hereunder, and would be solely for the convenience of
the Company and not because it was required or requested to do so by the
Investor or any such other third party purchaser.
4. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR. The Investor hereby
represents and warrants to the Company as follows:
(a) EXEMPT TRANSACTION; UNREGISTERED SHARES AND WARRANTS. The Investor
understands that the Shares and Warrants are being offered and sold in reliance
on one or more exemptions from registration provided for under the Securities
Act, and that the Company's reliance upon such exemptions is predicated, in
part, upon the Investor's representations and warranties set forth in this
Agreement. The Investor acknowledges that it is purchasing the Shares and
Warrants without being offered or furnished any offering literature or
prospectus. The Investor understands that neither the Commission, nor any
governmental agency charged with the administration of the securities laws of
any jurisdiction nor any other governmental agency has passed upon or reviewed
the merits or qualifications of, or recommended or approved the offer and sale
of the Shares and Warrants pursuant to the terms of this Agreement.
(b) INVESTMENT INTENT; ACCREDITATION; AUTHORITY. The Investor is acquiring
the Shares and Warrants for investment for the Investor's own account, not as
nominee or agent, for investment and not with a view to, or for resale in
connection with, any distribution or public offering thereof within the meaning
of the Securities Act; provided, however, that by making the representations
herein, the Investor reserves the right to dispose of the Shares, Warrants or
Warrant Shares at any time in accordance with this Agreement or the Warrant, as
applicable, and in accordance with or pursuant to a registration statement or an
exemption from registration under the Securities Act. The Investor is an
"accredited investor" within the meaning of the Securities Act. The Investor has
the full right, power, authority and capacity to enter into and perform this
Agreement, the terms of this Agreement constitute valid and binding obligations
of the Investor enforceable in accordance with their terms, except as the same
may be limited by equitable principles and by bankruptcy, insolvency,
moratorium, and other laws of general application affecting the enforcement of
creditors' rights.
(c) KNOWLEDGE AND EXPERIENCE. The Investor (i) has such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of the Investor's prospective investment in the Shares and
Warrants; (ii) has the ability to bear the economic risks of the Investor's
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prospective investment; (iii) has been furnished with and has had access to such
information as the Investor has considered necessary to make a determination as
to the purchase of the Shares and Warrants together with such additional
information as is necessary to verify the accuracy of the information supplied;
and (iv) has had all questions which have been asked by the Investor
satisfactorily answered by the Company.
(d) RESTRICTED SECURITIES. The Investor understands that the Shares and
Warrants are "restricted securities" as such term is defined in Rule 144 of
Regulation D promulgated under the Securities Act ("RULE 144") and must be held
indefinitely unless they are subsequently registered or qualified under
applicable state and federal securities laws or an exemption from such
registration or qualification is available. Except as contemplated by the
Registration Rights Agreement, the Investor understands that it may resell the
Shares and Warrant Shares pursuant to Rule 144 only after the satisfaction of
certain requirements, including the requirement that the Shares and Warrants
Shares be held for at least one year prior to resale.
(e) NO OBLIGATION TO REGISTER. The Investor further acknowledges and
understands that, except as provided in the Registration Rights Agreement, the
Company is under no obligation to register the Shares, Warrants or Warrant
Shares. The Investor understands that the certificate evidencing the Shares,
Warrants and Warrant Shares will be imprinted with a legend which prohibits the
transfer of the Shares, Warrants and Warrant Shares unless they are registered
or such registration is not required in the opinion of counsel in form and
substance satisfactory to the Company.
(f) FOREIGN INVESTOR REPRESENTATION. The Investor is not a "U.S. person"
(as such term is defined in Rule 902(k) of Regulation S promulgated under the
Securities Act), and the Investor hereby represents that it has satisfied itself
as to the full observance of the laws of its jurisdiction in connection with any
invitation to subscribe for the Shares and Warrants or any use of this
Agreement, including (i) the legal requirements within its jurisdiction for the
purchase of the Shares and Warrants, (ii) any foreign exchange restrictions
applicable to such purchase, (iii) any governmental or other consents that may
need to be obtained, and (iv) the income tax and other tax consequences, if any,
that may be relevant to the purchase, holding, redemption, sale or transfer of
the Shares and Warrants. The Investor's subscription and payment for, and its
continued beneficial ownership of the Shares and Warrants, will not violate any
applicable securities or other laws of its jurisdiction.
(g) DOMICILE. The Investor is a Cayman Islands corporation and has no
offices located in the United States.
(h) NO NEED FOR LIQUIDITY. The Investor's aggregate holding of securities
that are "restricted securities" or otherwise not readily marketable is not
excessive in view of the Investor's net worth and financial circumstances and
the purchase of the Shares and Warrants will not cause such commitment to become
excessive.
(i) INDEPENDENT ADVICE. The Investor understands that the Company urges
the Investor to seek independent advice from professional advisors relating to
the suitability for the Investor of an investment in the Company in view of the
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Investor's overall financial needs and with respect to legal and tax
implications of such an investment.
5. RELIANCE. The Investor understands that the Company may rely on the
representations and warranties in Section 4 in determining whether to permit the
Investor to purchase the Shares and Warrants. If for any reason any
representations and warranties are no longer true and accurate prior to the
Closing Date, the Investor will give the Company prompt written notice of the
inaccuracy. By signing below, the Investor represents that the Investor has read
and confirmed the truth and accuracy of each of the foregoing representations
and warranties.
6. ADDITIONAL COVENANTS OF THE PARTIES.
(a) INDEMNIFICATION. Each party (an "indemnifying party") agrees to
indemnify and hold harmless the other party hereto and each of its directors,
officers, members, managers, agents and affiliates (as applicable) from and
against any and all loss, damage or liability due to or arising out of a breach
by such indemnifying party of any representation, warranty or covenant contained
in this Agreement and made by such indemnifying party. The liability of the
Investor to provide indemnification pursuant to this Section 6 shall be limited
in the aggregate to $375,000.
(b) PLEDGE OF SECURITIES. The Company acknowledges and agrees that the
Shares, Warrants and Warrant Shares may be pledged by the Investor in connection
with a bona fide margin agreement or other loan or financing arrangement that is
secured by the Shares Warrants or Warrant Shares. The pledge of the Shares,
Warrants or Warrant Shares shall not be deemed to be a transfer, sale or
assignment of the Shares, Warrants or Warrant Shares hereunder, and the Investor
shall not be required to provide the Company with any notice thereof or
otherwise make any delivery to the Company pursuant to this Agreement or any
other Transaction Agreement. The Company hereby agrees to execute and deliver
such documentation as a pledgee of the Shares, Warrants or Warrant Shares may
reasonably request in connection with a pledge of the thereof to such pledgee by
the Investor.
(c) SECURITIES LAWS DISCLOSURE; PUBLICITY. The Company shall (i) if
required by applicable law, on or promptly after the Closing Date issue a press
release disclosing the transactions contemplated hereby, and (ii) promptly after
the Closing Date, file with the Commission a Report on Form 8-K disclosing the
transactions contemplated hereby. Except as provided in the preceding sentence,
neither the Company nor the Investor shall make any press release or other
publicity about the terms of this Agreement or the transactions contemplated
hereby without the prior approval of the other unless otherwise required by law,
regulation or the rules of the Commission. In addition, the Company agrees that
it shall not disclose, and shall not include in any public filing or other
announcement, the name of the Investor, unless expressly agreed to in writing by
the Investor or unless and until such disclosure is, in the reasonable opinion
of counsel to the Company, required by law or applicable regulation, and then
only to the extent of such requirement.
(d) LISTING. The Company shall promptly secure the listing of the Shares
and Warrant Shares (and any Registrable Securities (as defined in the
Registration Rights Agreement) that may from time to time be issued or issuable)
upon each national securities exchange or automated quotation system or bulletin
10
board, if any, upon which shares of Common Stock are then listed (subject to
official notice of issuance) and, so long as the Investor owns any of the
Registrable Securities (as defined in the Registration Rights Agreement), shall
maintain, so long as any other shares of Common Stock shall be so listed, such
listing of all Shares issued pursuant to this Agreement and Warrant Shares
issuable upon exercise of or otherwise pursuant to the Warrants, and any
Registrable Securities (as defined in the Registration Rights Agreement) that
may from time to time be issued or issuable. To the extent that any Common Stock
is so listed, the Company will obtain and, so long as the Investor owns any of
the Registrable Securities (as defined in the Registration Rights Agreement),
maintain the listing and trading of its Common Stock on the Nasdaq SmallCap, the
Nasdaq National Market, the New York Stock Exchange, or the American Stock
Exchange and will comply in all respects with the Company's reporting, filing
and other obligations under the bylaws or rules of any exchanges or automated
quotation systems on which the Common Stock is then listed.
7. RESTRICTIVE LEGENDS AND STOP-TRANSFER ORDERS.
(a) LEGEND. The instruments representing the Shares, Warrants and, if
applicable, Warrant Shares shall bear the following legend or similar legend (as
well as any legends required by applicable corporate law and state and federal
securities laws):
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, PLEDGED 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, PLEDGE OR HYPOTHECATION IS IN
COMPLIANCE THEREWITH.
(b) REMOVAL OF LEGEND AND TRANSFER RESTRICTIONS. Any legend
endorsed on a certificate pursuant to this Section 7 shall be
removed, and the Company shall issue a certificate without such
legend to the holder of such Shares, Warrants or Warrant Shares, as
applicable, if (i) such Shares or Warrant Shares are resold pursuant
to a registration statement under the Securities Act, and a
prospectus meeting the requirements of Section 11 of the Securities
Act is delivered or deemed delivered to the purchaser of such Shares
or Warrant Shares, (ii) if such holder satisfies the requirements of
Rule 144(k) or (iii) if such holder provides the Company with an
opinion of counsel for such holder of the Shares, Warrants or
Warrant Shares, reasonably satisfactory to the Company, to the
effect that a sale, transfer or assignment of such Shares, Warrants
or Warrant Shares may be made without registration.
8. PRICE PROTECTION. If the Company issues or sells any shares of
its Common Stock or Common Stock Equivalents, other than Excluded
Shares (as that term is defined below) ("ADDITIONAL SHARES") at any
time after the Closing Date and prior to June 30, 2004 (the
"ADJUSTMENT PERIOD") for a consideration per share (as to any such
issuance, the "DILUTIVE PRICE") (a) less than the Share Price (as
adjusted for stock splits, stock dividends and the like) and (b) if
11
Additional Shares have been previously issued during the Adjustment
Period with respect to which the Company has fully complied with
this Section 8, then also less than the lowest Dilutive Price (as
adjusted for stock splits, stock dividends and the like) at which
such Additional Shares have been previously issued during the
Adjustment Period, then the Company will issue to each Investor a
number of shares, if positive, of Common Stock to such Investor
determined by the following formula:
X = (A * B / C) - (A + D)
Where: X = the number of shares of Common Stock to
be issued to the Investor, rounded to
the nearest whole number;
A = the number of Shares (as adjusted for
stock splits, stock dividends and the
like) then held by the Investor;
B = the Share Price (as adjusted for stock
splits, stock dividends and the like);
C = the applicable Dilutive Price; and
D = the aggregate number of shares of Common
Stock (as adjusted for stock splits,
stock dividends and the like) issued to
the Investor pursuant to this Section 8
prior to the date of such determination.
For purposes of this Agreement, the term "EXCLUDED SHARES" means: (i) shares of
Common Stock issuable or issued after the Closing Date to officers, employees,
consultants or directors of the Company directly or pursuant to a stock
purchase, stock option, restricted stock or other written compensation plan or
agreement approved by the Board of Directors of the Company (the "BOARD"); (ii)
shares of Common Stock issued or issuable after the Closing Date, primarily for
non-equity financing purposes and as approved by the Board, to financial
institutions or lessors in connection with commercial credit arrangements,
equipment financings or similar transactions or to vendors of goods or services
or customers; (iii) shares of Common Stock issuable upon (a) exercise of
warrants, options, notes or other rights to acquire securities of the Company,
in each case, outstanding on the Agreement Date, (b) conversion of shares of the
Company's Preferred Stock, par value $0.01 per share outstanding on the
Agreement Date or (c) exchange of promissory notes issued by the Company
outstanding on the Agreement Date; (iv) capital stock or warrants or options to
purchase capital stock issued in connection with bona fide acquisitions, mergers
or similar transactions, the terms of which are approved by the Board; (v)
shares of Common Stock issued or issuable to licensors of technology of the
Company to pay expenses, royalties or milestone payments for which the Company
is obligated under any licensing or related agreement; (vi) shares of Common
Stock issuable or issued pursuant to stock splits, stock dividends and the like,
or (vii) shares of Common Stock issued or issuable by way of dividend or other
distribution on any shares of Common Stock issued pursuant to clauses (i)- (vi)
above.
12
If the Company shall issue or sell any warrants or other rights to subscribe for
or purchase any additional shares of Common Stock or any securities convertible
into shares of Common Stock (collectively, "COMMON STOCK EQUIVALENTS") during
the Adjustment Period, whether or not the rights to exchange or convert
thereunder are immediately exercisable, and the effective price per share for
which Common Stock is issuable upon the exercise, exchange or conversion of such
Common Stock Equivalents shall be less than (i) the Share Price (as adjusted for
stock splits, stock dividends and the like) and (ii) if Additional Shares have
been previously issued during the Adjustment Period with respect to which the
Company has fully complied with this Section 8, then also less than the lowest
Dilutive Price (as adjusted for stock splits, stock dividends and the like) at
which such Additional Shares have been previously issued during the Adjustment
Period, then the Company shall issue to the Investor that number of shares of
Common Stock that would be issuable pursuant to this Section 8 on the basis that
the maximum number of additional shares of Common Stock issuable pursuant to all
such Common Stock Equivalents shall be deemed to have been issued and
outstanding and the Company shall have received all of the consideration payable
therefor, if any, as of the date of the actual issuance of such Common Stock
Equivalents. No further issuances shall be made under this Section 8 upon the
actual issue of such Common Stock upon the exercise, conversion or exchange of
such Common Stock Equivalents, unless such actual issue is at a per share
consideration lower than the Dilutive Price used for purposes of the initial
adjustment pursuant to this Section 8.
9. MISCELLANEOUS.
(a) GOVERNING LAW. This Agreement, all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the state of
California, without giving effect to principles of choice of law, except that
corporate matters shall be governed by Delaware law.
(b) JURISDICTION AND VENUE. Any legal action or other legal proceeding
relating to this Agreement or the enforcement of any provision of this Agreement
shall be brought or otherwise commenced in any state or federal court located in
the County of San Diego, California. Each party to this Agreement: (i) expressly
and irrevocably consents and submits to the jurisdiction of each state and
federal court located in the County of San Diego, California and each appellate
court located in the state of California, in connection with any such legal
proceeding; (ii) agrees that each state and federal court located in the County
of San Diego, California shall be deemed to be a convenient forum; and (iii)
agrees not to assert, by way of motion, as a defense or otherwise, in any such
legal proceeding commenced in any state or federal court located in the County
of San Diego, California any claim that such party is not subject personally to
the jurisdiction of such court, that such legal proceeding has been brought in
an inconvenient forum, that the venue of such proceeding is improper or that
this Agreement or the subject matter of this Agreement may not be enforced in or
by such court.
(c) ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and understandings
relating to the subject matter hereof. No statement, representation, warranty,
covenant or agreement of any kind not expressly set forth in this Agreement
shall affect, or be used to interpret, change or restrict, the express terms and
provisions of this Agreement.
13
(D) NOTICES. All notices and other communications hereunder shall be in writing
and shall be given (and shall be deemed to have been duly given upon
receipt) by delivery in person or facsimile transmission (received at the
facsimile machine to which it is transmitted prior to 5:00 p.m., local
time, on a business day in the State of California, for the party to which
it is sent), by courier or express delivery service or by registered or
certified mail (postage prepaid, return receipt requested) to the
respective parties at the following addresses (or at such other address for
a party as shall be specified in a notice given in accordance with this
Section):
if to the Company: ADVENTRX Pharmaceuticals, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy to (not to constitute notice): Xxxxxxx XxXxxxxxx LLP
0 Xxxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxx, Xx.
Facsimile: (000) 000-0000
if to the Investor: CD Investment Partners, Ltd.
c/o CD Capital Management LLC
Two Xxxxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy to (not to constitute notice): Xxxxxxxxx Traurig, LLP
00 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxxx and Xxxx X . Xxxxx
Facsimile: (000) 000-0000
(e) AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended,
waived or departed from only with the written consent of the Company and the
Investor. No such waiver or consent shall be deemed to be or shall constitute a
waiver or consent with respect to any other terms or provisions of this
Agreement, whether or not similar. Each such waiver or consent shall be
effective only in the specific instance and for the purpose for which it was
given, and shall not constitute a continuing waiver or consent.
(f) SUCCESSORS AND ASSIGNS. This Agreement is personal to each of the
parties and may not be assigned without the written consent of the other party;
provided, however, that the Investor shall be permitted to assign this Agreement
14
to any person to whom it assigns or transfers securities issued or issuable
pursuant to this Agreement in compliance with applicable securities laws and
this Agreement. Any assignee must be an "accredited investor" as defined in Rule
501(a) promulgated under the Securities Act.
(g) SEVERABILITY. In the event that any court of competent jurisdiction
shall determine that any provision, or any portion thereof, contained in this
Agreement shall be unenforceable in any respect, then such provision shall be
deemed limited to the extent that such court deems it enforceable, and as so
limited shall remain in full force and effect. In the event that such court
shall deem any such provision, or portion thereof, wholly unenforceable, the
remaining provisions of this Agreement shall nevertheless remain in full force
and effect.
(h) INTERPRETATION. The parties hereto acknowledge and agree that: (i)
each party and such party's counsel has reviewed the terms and provisions of
this Agreement; (ii) the rule of construction to the effect that any ambiguities
are resolved against the drafting party shall not be employed in the
interpretation of this Agreement; and (iii) the terms and provisions of this
Agreement shall be construed fairly as to the parties hereto and not in favor of
or against any party, regardless of which party was generally responsible for
the preparation of this Agreement. Whenever used herein, the singular number
shall include the plural, the plural shall include the singular, the use of any
gender shall include all persons.
(i) HEADINGS AND CAPTIONS. The headings and captions of the various
subdivisions of this Agreement are for convenience of reference only and shall
in no way modify, or affect the meaning or construction of any of the terms or
provisions hereof.
(j) NO WAIVER OF RIGHTS, POWERS AND REMEDIES. No failure or delay by a
party hereto in exercising any right, power or remedy under this Agreement, and
no course of dealing between the parties hereto, shall operate as a waiver of
any such right, power or remedy of the party. No single or partial exercise of
any right, power or remedy under this Agreement by a party hereto, nor any
abandonment or discontinuance of steps to enforce any such right, power or
remedy, shall preclude such party from any other or further exercise thereof or
the exercise of any other right, power or remedy hereunder. The election of any
remedy by a party hereto shall not constitute a waiver of the right of such
party to pursue other available remedies. No notice to or demand on a party not
expressly required under this Agreement shall entitle the party receiving such
notice or demand to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the party giving such
notice or demand to any other or further action in any circumstances without
such notice or demand.
(k) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made by the parties hereto in this Agreement, shall survive (i) the
execution and delivery hereof, (ii) any investigations made by or on behalf of
the parties and (iii) the closing of the transaction contemplated hereby.
(l) EXPENSES. Except as otherwise provided in any other Transaction
Agreement, the Company and the Investor shall each be responsible for the
payment of and bear their own expenses and legal fees relating to the
preparation and negotiation of the Transaction Agreements and the consummation
of the Transactions.
15
(m) COUNTERPARTS AND FACSIMILE DELIVERY. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Any signature page
delivered by facsimile or other electronic image transmission shall be binding
to the same extent as an original signature page, with regard to any agreement
subject to the terms hereof or any amendment thereto. Any party who delivers
such a signature page agrees to later deliver an original counterpart to any
party who requests it.
(n) SECURITIES LAW COMPLIANCE.
(i) SECURITIES ACT. The Company shall timely prepare and file with the
Commission the form of notice of the sale of securities pursuant to
the requirements of Regulation D regarding the sale of the Shares and
Warrants under this Agreement.
(ii) STATE SECURITIES LAW COMPLIANCE -- SALE. The Company shall timely
prepare and file such applications, consents to service of process
(but not including a general consent to service of process) and
similar documents and take such other steps and perform such further
acts as shall be required by the State of Illinois, with respect to
the sale of the Shares and Warrants under this Agreement.
(iii) STATE SECURITIES LAW COMPLIANCE --RESALE. Beginning no later
than June 30, 2004 and continuing until (i) the Investor has sold all
of its Registrable Securities under a Registration Statement or (ii)
the Common Stock becomes a "covered security" under Section
18(b)(1)(A) of the Securities Act, the Company shall maintain within
either Xxxxx'x Industrial Manual or Standard and Poor's Standard
Corporation Descriptions (or any successors to these manuals which are
similarly qualified as "recognized securities manuals" under state
Blue Sky laws) an updated listing containing (i) the names of the
officers and directors of the Company, (ii) a balance sheet of the
Company as of a date that is at no time older than eighteen months and
(iii) a profit and loss statement of the Company for either the
preceding fiscal year or the most recent year of operations.
Capitalized terms used in this Section 10(n)(iii), but not otherwise
defined in this Agreement, shall have the meanings assigned in the
Registration Rights Agreement.
(o) INDEPENDENT NATURE OF THE INVESTOR'S OBLIGATIONS AND RIGHTS. The
obligations of the Investor under the Transaction Agreements are several and not
joint with the obligations of any other third party purchaser of the Company's
securities, and the Investor shall not be responsible in any way for the
performance of the obligations of any other third party purchaser. Each of the
Investor and the Company agrees and acknowledges that (i) the decision of the
Investor to purchase securities pursuant to this Agreement has been made by the
Investor independently of any other third party purchasers of the Company's
securities and (ii) no other third party purchasers of the Company's securities
have acted as agent for the Investor in connection with the Investor making its
investment hereunder and that no such other third party purchasers will be
16
acting as agent of the Investor in connection with monitoring its investment
hereunder. Nothing contained herein or in any Transaction Agreement or any
agreement of any such other third party purchaser, and no action taken by the
Investor pursuant hereto or any other third party purchaser pursuant thereto,
shall be deemed to constitute the Investor or any other third party purchasers
as a partnership, an association, a joint venture or any other kind of entity,
or create a presumption that the Investor and any other third party purchaser
are in any way acting in concert or as a group with respect to any matters. The
Investor shall be entitled to independently protect and enforce its rights,
including without limitation, the rights arising out of the Transaction
Agreements, and it shall not be necessary for any other third party purchaser to
be joined as an additional party in any proceeding for such purpose. To the
extent that any such other third party purchasers purchase the same or similar
securities as the Investor hereunder or on the same or similar terms and
conditions or pursuant to the same or similar documents, all such matters are
solely in the control of the Company, not the action or decision of the Investor
and are not done with the knowledge of the Investor hereunder, and would be
solely for the convenience of the Company and not because it was required or
requested to do so by the Investor or any such other third party purchaser.
[Signature page follows.]
17
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
ADVENTRX PHARMACEUTICALS, INC.
By: /s/ Xxxxxxxx X. Xxxxx
Name: Xxxxxxxx X. Xxxxx
Title: President
CD INVESTMENT PARTNERS, LTD.
By: CD Capital Management LLC
Its: Investment Manager
By: /s/ Xxxx Xxxxxxxxx
Name: Xxxx Xxxxxxxxx
Title: President
SCHEDULE 3
DISCLOSURE SCHEDULE
EXHIBIT A-1
Form of A-1 Common Stock Purchase Warrant
EXHIBIT A-2
Form of A-2 Common Stock Purchase Warrant
EXHIBIT B
Form of Registration Rights Agreement
EXHIBIT C
Form of Opinion of Company's Counsel
EXHIBIT D
INVESTOR SUITABILITY QUESTIONNAIRE
ADVENTRX PHARMACEUTICALS, INC. (THE "COMPANY")
(ALL INFORMATION WILL BE TREATED CONFIDENTIALLY)
A. ENTITY NAME AND CONTACT INFORMATION
Name:
-----------------------------------------------------------------
(Exact name as it should appear on stock certificate.)
Name of Institution or Destination: ___________________________________
(Include if different from
stock certificate.)
Address:
---------------------------------------------------------------
Account Reference (if applicable): ____________________________________
Tax Identification Number (if applicable):
---------------------------
Contact Name:
--------------------------------------------------------
Contact Telephone Number:
--------------------------------------------
Contact Fax Number: ___________________________________________________
Contact Email Address:
-----------------------------------------------
B. GENERAL INFORMATION
Under the laws of what jurisdiction was the Investor formed?
Was the Investor formed for the purpose of investing in the securities
being offered?
Yes _____ No _____
Set forth in the space provided below the (i) state(s), if any, in the
United States in which you maintained your principal office during the
past two years and the dates during which you maintained your office in
each state, (ii) the state(s), if any, in which you are incorporated or
otherwise organized, and (iii) the state(s), if any, in which you still
pay income taxes:
-----------------------------------------------------------------------
-----------------------------------------------------------------------
-----------------------------------------------------------------------
C. ACCREDITED INVESTOR INFORMATION
(i) Is the Investor a national bank or a banking institution organized
under the laws of any state or any territory of the United States or
the District of Columbia?
Yes _____ No _____
(ii) Is the Investor a savings and loan association, building and loan
association, cooperative bank, homestead association, or similar
institution, which is supervised and examined by any state or federal
authority having supervision over such institution?
Yes _____ No _____
(iii) Is the Investor a broker or dealer registered pursuant to Section
15 of the Securities Exchange Act of 1934?
Yes _____ No _____
(iv) Is the Investor a company (i) whose primary and predominant
business is underwriting insurance and subject to the supervision by a
regulatory agency under the laws of any state or territory, or (ii)
registered as an investment company under the Investment Company Act of
1940, or (iii) a Small Business Investment Company licensed by the U.S.
Small Business Administration?
Yes _____ No _____
(v) Is the Investor a "business development company" within the meaning
of the Investment Company Act of 1940 or the Investment Advisers Act of
1940?
Yes _____ No _____
(vi) Is the Investor an employee benefit plan under the Employee
Retirement Income Security Act of 1974 (a "PLAN") with assets in excess
of $5,000,000?
Yes _____ No _____
(a) If the Investor is such a Plan, but if the Plan's total
assets do not exceed $5,000,000, are investment decisions for
the Plan made by a bank, savings and loan association,
insurance company or registered investment adviser acting as
fiduciary? (If yes, please specify the name of the fiduciary.)
Yes _____ No _____
Name of Fiduciary:
-------------------------------------------
(b) If the Investor is a self-directed Plan, but if the Plan's
total assets do not exceed $5,000,000, are investment
decisions made solely by (1) a person or entity that can
answer "yes" to one or more questions under paragraphs (i) -
(ix) of this Item C; (2) persons whose net worth, or joint net
worth with their spouses, exceeds $1,000,000; (3) persons
whose income without regard to that of their spouses exceeded
$200,000, or whose joint income with their spouses exceeded
$300,000, in each of the last two years and who reasonably
expect such person income to exceed $200,000 or such joint
income to exceed $300,000 this year; or (4) persons who are
brokers or dealers registered pursuant to Section 15 of the
Securities Exchange Act of 1934? (If yes, please specify the
applicable subpart of this question or Item.)
Yes _____ No _____
Subpart or Item: ___________
(vii) Is the Investor (A)(1) a tax exempt organization which is
qualified under Section 501(c)(3) of the Internal Revenue Code of 1986
as amended, or (2) a corporation, or (3) a Massachusetts or similar
business trust, or (4) a partnership, not formed for the specific
purpose of acquiring the securities offered, and (B) which has assets
in excess of $5,000,000?
Yes _____ No _____
(viii) Is the Investor 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 person who has such
knowledge and experience in financial and business matters that he is
capable of evaluating the merits and risks of the prospective
investment?
Yes _____ No _____
If yes, please attach a memorandum describing such person's
educational background, professional memberships or licenses,
current employment, principal business and professional
activities during the last five years, and experience as an
investor in securities. Include any additional information
evidencing that such person has sufficient knowledge and
experience in financial matters that such person would be
capable of evaluating the merits and risks of investing in the
securities being offered.
(ix) Is the Investor an entity in which all of the equity owners are
persons who are either (1) entities described in paragraphs (i) through
(viii) above; (2) persons whose net worth, or joint net worth with
their spouses, exceeds $1,000,000; (3) persons whose income without
regard to that of their spouses exceeded $200,000, or whose joint
income with their spouses exceeded $300,000, in each of the last two
years and who reasonably expect such person income to exceed $200,000
or such joint income to exceed $300,000 this year; or (4) persons who
are brokers or dealers registered pursuant to Section 15 of the
Securities Exchange Act of 1934?
Yes _____ No _____
If an equity owner is an entity described in paragraph (vi)
under this Item C, please provide the information required by
such paragraph.
The above information has been requested by the Company and will be used
solely to confirm that the Company is complying with certain securities
regulations. In furnishing the above information, the undersigned acknowledges
that the Company will be relying thereon in assessing the requirements of the
Securities Act of 1933, as amended, and other applicable securities laws.
The information contained in this questionnaire is true and complete,
and the undersigned understands that the Company and its counsel will rely on
such information for the purpose of complying with all applicable securities
laws, as discussed above. The undersigned agrees to notify the Company promptly
of any change in the foregoing information which may occur prior to any purchase
by the undersigned of stock from the Company.
Date:
-----------------------------
ENTITY INVESTOR:
By:
-----------------------------------------
(signature)
Name:
--------------------------------------
(please print)
Title:
-------------------------------------
(please print)
