SUBSCRIPTION AGREEMENT
THE
SHARES OF COMMON
STOCK
SUBSCRIBED FOR BY THIS AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY OTHER APPLICABLE STATE SECURITIES LAWS AND
TRANSFER OF SUCH SHARES IS RESTRICTED BY THE TERMS OF THIS
AGREEMENT.
This
SUBSCRIPTION AGREEMENT (the "Agreement")
is
made by and between the subscriber hereto (the “Subscriber”)
and
Calypte
Biomedical Corporation,
a
Delaware
corporation
(the "Company”).
The
Subscriber hereby agrees to purchase, and the Company hereby agrees to issue
and
to sell to the Subscriber, the number of shares (the “Shares”)
of
common stock of the Company, par value $.03 per share (the "Common
Stock"),
and
warrant to purchase additional shares of Common Stock (the “Warrant”),
in
the form of Exhibit
A,
(the
Shares, the Warrant and the shares underlying the Warrant are hereinafter
referred to collectively as the “Securities”),
set
forth on the signature page, for a purchase price in cash equal to $0.035
per
share (the aggregate amount to be paid by the Subscriber shall be referred
to as
the "Purchase
Price").
After
acceptance of this Agreement by the Company and payment and delivery by the
Subscriber to the Company of the Purchase Price in the form of wire transfer
pursuant to the terms of Section 7(b) of this Agreement, the Company shall
issue
and deliver to the Subscriber the Securities.
NOW,
THEREFORE, in order to implement the foregoing and in consideration of the
mutual representations, warranties, covenants and agreements contained herein
and for other good and valuable consideration, the receipt and adequacy of
which
are hereby acknowledged, the parties hereto agree as follows.
1. Subscriber's
Representations and Warranties.
The
Subscriber hereby represents and warrants to and agrees with the Company
that:
(a) Access
to Information.
The
Subscriber acknowledges that it has been furnished with the Company's Form
10-K
for the year ended December 31, 2007 as filed with the Securities and Exchange
Commission (the “Commission”)
together with all subsequently filed Forms 10-Q, 8-K, and other publicly
available filings made with the Commission (hereinafter referred to collectively
as the "Reports")
and
has been afforded (i) the opportunity to ask such questions as it has deemed
necessary of, and to receive answers from, representatives of the Company
concerning the terms and conditions of the offering of the Securities and the
merits and risks of investing in the Company; (ii) access to information about
the Company and its subsidiary and their respective financial condition, results
of operations, business, properties, management and prospects sufficient to
enable it to evaluate its investment; and (iii) the opportunity to obtain such
additional information that the Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed investment
decision with respect to the investment. Neither such inquiries nor any other
investigation conducted by or on behalf of the Subscriber or its representatives
or counsel shall modify, amend or affect the Subscriber's right to rely on
the
truth, accuracy and completeness of the Reports and the Company's
representations and warranties contained herein.
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(b) Information
on Subscriber.
The
Subscriber is and was not a “U.S. person,” as defined in Regulation S of the
Securities Act of 1933, as amended (the “1933
Act”),
at
the time the offer or sale of the Securities is made. Additionally, the
Subscriber is an "accredited investor," as such term is defined in Regulation
D
of the 1933 Act or is part of a group that is experienced in investments and
business matters, has made investments of a speculative nature and has purchased
securities of United States publicly-owned companies in private placements
in
the past and, with its representatives, has such knowledge and experience in
financial, tax and other business matters as to enable the Subscriber to utilize
the information made available by the Company, to evaluate the merits and risks
of an investment in the Company and to make an informed investment decision
with
respect to the proposed purchase, which represents a speculative investment.
The
Subscriber is a natural person or an entity duly organized, validly existing
and
in good standing under the laws of the jurisdiction of its organization with
the
requisite corporate or partnership power and authority to enter into and to
consummate the transactions contemplated by this Agreement and otherwise to
carry out its obligations hereunder. The execution, delivery and performance
by
the Subscriber of the transactions contemplated by this Agreement has been
duly
authorized by all necessary corporate or, if the Subscriber is not a
corporation, such partnership, limited liability company or other applicable
like action, on the part of the Subscriber. This Agreement has been duly
executed by the Subscriber and when delivered by the Subscriber in accordance
with terms hereof, will constitute the valid and legally binding obligation
of
the Subscriber, enforceable against it in accordance with its terms, except
as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of, creditors’ rights and remedies or by
other equitable principles of general application. The Subscriber is able to
bear the risk of such investment for an indefinite period and to afford a
complete loss thereof. The information set forth on the signature page hereto
regarding the Subscriber is accurate.
(c) Purchase
of Securities and Investment Intent.
The
Subscriber is purchasing the Securities for its own account for the Purchase
Price. The Subscriber is acquiring the Securities as principal for its own
account for investment purposes only and not with a view to or for distributing
or reselling such Shares or Warrant or any part thereof, without prejudice,
however, to the Subscriber’s right at all times to sell or otherwise dispose of
all or any part of such Securities in compliance with applicable federal and
state securities laws. The Subscriber does not have any agreement or
understanding, directly or indirectly, with any person to distribute any of
the
Securities. The Subscriber also represents that its purchase of the Securities
is intended to be made as an “Offshore
Transaction”
as
defined in Regulation S.
(d) Compliance
with Securities Act.
The
Subscriber understands and agrees that the Securities have not been registered
under the 1933 Act, by reason of their issuance in a transaction that does
not
require registration under the 1933 Act (based in part on the accuracy of the
representations and warranties of the Subscriber contained herein), and that
such Securities must be held unless a subsequent disposition is registered
under
the 1933 Act or is exempt from such registration.
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(e) Legend
on Securities.
The
Securities shall bear the following legend (or something comparable for the
Warrant), unless the Securities shall have been included in an effective
registration statement under the 1933 Act:
"THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THESE SECURITIES MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT
REQUIRED.”
(f) Communication
of Offer.
The
offer to sell the Securities was directly communicated to the Subscriber. At
no
time was the Subscriber presented with or solicited by any leaflet, newspaper
or
magazine article, radio or television advertisement, or any other form of
general advertising or solicited or invited to attend a promotional meeting
otherwise than in connection and concurrently with such communicated
offer.
(g)
Certain Trading Activities.
The
Subscriber has not directly or indirectly, nor has any person acting on behalf
of or pursuant to any understanding with the Subscriber, engaged in any trading
in any securities of the Company (including, without limitation, any Short
Sales
(defined below) involving the Company’s securities) during the 20 trading days
immediately preceding the Closing. For purposes of this Section, "Short
Sales"
include,
without limitation, all “short sales” as defined in Rule 3b-3 of the Securities
Exchange Act of 1934, as amended (the “1934
Act”)
and
include all types of direct and indirect stock pledges, forward sale contracts,
options, puts, calls, short sales, swaps and similar arrangements (including
on
a total return basis), and sales and other transactions through non-U.S. broker
dealers or foreign regulated brokers having the effect of hedging the securities
or investment made under this Agreement. As of the date of this Agreement,
the
Subscriber has no open short position in the Common Stock, and covenants that
neither it nor any person acting on its behalf or pursuant to any understanding
with it will engage in any Short Sales prior to the public disclosure of the
material terms of this transaction by the Company.
(h) Correctness
of Representations.
The
Subscriber represents that the foregoing representations and warranties are
true
and correct. The foregoing representations and warranties shall survive the
date
hereof.
2. Company
Representations and Warranties.
The
Company represents and warrants to and agrees with the Subscriber
that:
(a) Due
Incorporation.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has the requisite corporate power
to
own its properties and to carry on its business as now being conducted. The
Company is duly qualified as a foreign corporation to do business and is in
good
standing in each jurisdiction where the nature of the business conducted or
property owned by it makes such qualification necessary, other than those
jurisdictions in which the failure to so qualify would not have a material
adverse effect on the business, operations or financial condition of the
Company.
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(b) Outstanding
Stock.
All
issued and outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and
non-assessable.
(c) Authority;
Enforceability.
This
Agreement has been duly authorized, executed and delivered by the Company and
is
a valid and binding agreement enforceable in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and
similar laws of general applicability relating to or affecting creditors' rights
generally and to general principles of equity; and the Company has full
corporate power and authority necessary to enter into this Agreement and to
perform its obligations hereunder.
(d) Shares
Duly Authorized.
The
Securities when issued and delivered in accordance with the terms of this
Agreement, will be duly authorized, validly issued, fully paid and
non-assessable.
(e) Stop
Transfer.
The
Shares are restricted securities as of the date of this Agreement. The Company
will not issue any stop transfer order or other order impeding the sale, resale
or delivery of the Stock, except as may be required by federal securities
laws.
(f) No
General Solicitation.
Neither
the Company, nor any of its affiliates, nor to its knowledge, any person acting
on its or their behalf, has engaged in any form of general solicitation or
general advertising (within the meaning of Regulation S or D under the 0000
Xxx)
in connection with the offer or sale of the Shares.
3. Regulation
S Offering.
This
offering is being made pursuant to the exemption from the registration
provisions of the 1933 Act afforded by Regulation S thereunder.
4. Reissuance
of Securities.
The
Company will cause the removal of the legend set forth in Section 1(e) above
at
such time as (a) the Subscriber is permitted to, and disposes of, the Securities
pursuant to an exemption to the registration requirements of the 1933 Act or
Rule 144 of the 1933 Act, in the opinion of counsel reasonably satisfactory
to
the Company, or (b) upon sale of the Securities pursuant to an effective
registration statement under the 1933 Act. The Company agrees to cooperate
with
the Subscriber in connection with all sales pursuant to Rule 144 of the 1933
Act
and provide legal opinions necessary to allow such sales provided the Company
and its counsel receive requested written representations from the Subscriber
and selling broker, if any. The Company will pay for its costs in connection
with the removal of the legend hereunder.
5. “Piggy-Back”
Registration Rights.
(a) The
Company agrees that when it registers any Common Stock under the 1933 Act by
registration on Form S-1 or other similar form for sale for the account of
one
or more holders of Common Stock, the Company will use its best efforts to
register all or some portion of the Securities in such registration statement
as
the Company may reasonably determine feasible. The Company will pay all expenses
incident to the registration of the Securities hereunder and the Company’s
performance of or compliance with this Agreement.
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(b)
The
Seller will furnish to the Company in writing such information and
representation letters with respect to itself and the proposed distribution
by
it as reasonably shall be necessary in order to assure compliance with federal
and state securities laws.
6. Fees
and Expenses.
Each
party shall pay the fees and expenses of its advisers, counsel, accountants
and
other experts, if any, and all other expenses incurred by such party incident
to
the negotiation, preparation, execution, delivery and performance of this
Agreement. The Company shall pay all stamp and other taxes and duties levied
in
connection with the issuance of the Securities.
7. Miscellaneous.
(a) Notices.
All
notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise
specified herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery or facsimile, addressed as set forth below or
to
such other address as such party shall have specified most recently by written
notice. Any notice or other communication required or permitted to be given
hereunder shall be deemed effective (a) upon hand delivery or delivery by
facsimile, with accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on a business
day during normal business hours where such notice is to be received), or the
first business day following such delivery (if delivered other than on a
business day during normal business hours where such notice is to be received)
or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual
receipt of such mailing, whichever shall first occur. The addresses for such
communications shall be: (i) if to the Company to Calypte Biomedical
Corporation, 00000 XX Xxxxx Xxxxxx Xxxxx Xxxx, Xxxxxxxx, Xxxxxx 00000, facsimile
number: (000) 000-0000, and
(ii)
if to the Subscriber, to the name, address and facsimile number set forth on
the
signature page hereto.
(b) Closing.
The
closing of the transactions contemplated by this Agreement shall take place
on
September 19, 2008 at 5:00 p.m. (Pacific Standard Time) at the Company’s
corporate office or such other location and time as may be determined by the
Company. At the closing, the Subscriber shall deliver to the Company the
Purchase Price in United States dollars and in immediately available funds,
by
wire transfer to the following account:
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Pay
to:
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FC
- Silicon Valley Bank
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0000
Xxxxxx Xxxxx
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Xxxxx
Xxxxx, XX 00000, XXX
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Routing
& Transit #:
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\\FW:000000000
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Swift
Code:
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XXXXXX0X
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For
Credit of:
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Calypte
Biomedical Corporation
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Final
Credit Account #:
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FNC
- 3300349200
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Upon
receipt of the Purchase Price, the Company shall deliver to the Subscriber,
the
Securities.
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(c) Entire
Agreement; Assignment.
This
Agreement represents the entire agreement between the parties hereto with
respect to the subject matter hereof and may be amended only by a writing
executed by both parties. No right or obligation of either party shall be
assigned by that party without the written consent of the other party.
(d) Execution.
This
Agreement may be executed in separate counterparts, each of which shall be
deemed an original and both of which shall constitute one and the same document.
This Agreement may be executed by facsimile transmission.
(e) Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Oregon without regard to principles of conflicts of laws. Any action
brought by either party against the other concerning the transactions
contemplated by this Agreement shall be brought only in the state courts of
Oregon or in the federal courts located in the state of Oregon. Both parties
and
the individuals executing this Agreement agree to submit to the jurisdiction
of
such courts and waive trial by jury. The prevailing party shall be entitled
to
recover from the other party its reasonable attorney's fees and costs. In the
event that any provision of this Agreement or any other agreement delivered
in
connection herewith is invalid or unenforceable under any applicable statute
or
rule of law, then such provision shall be deemed inoperative to the extent
that
it may conflict therewith and shall be deemed modified to conform with such
statute or rule of law. Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability
of
any other provision of any agreement.
(f) Specific
Enforcement, Consent to Jurisdiction.
The
Company and the Subscriber acknowledge and agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent or cure breaches of the provisions of this Agreement
and
to enforce specifically the terms and provisions hereof or thereof, this being
in addition to any other remedy to which any of them may be entitled by law
or
equity. Subject to Section 7(e) hereof, each of the Company and the Subscriber
hereby waives, and agrees not to assert in any such suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of such court,
that the suit, action or proceeding is brought in an inconvenient forum or
that
the venue of the suit, action or proceeding is improper. Nothing in this Section
shall affect or limit any right to serve process in any other manner permitted
by law.
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IN
WITNESS WHEREOF,
the
parties have hereby executed this Agreement as of the day set forth in the
acceptance set forth below.
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20,000,000
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SUBSCRIBER
NAME:
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Number
of Shares
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1,000,000
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Number
of Shares Underlying Warrant
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$700,000
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By:
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Dollar
Amount of Subscription
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Title:
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| Tendered by Subscriber | ||
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(City
and State)(Zip
Code)
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Telephone
Number
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ACCEPTANCE
The
foregoing subscription is hereby accepted, subject to the terms and conditions
hereof, as of September __, 2008.
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$700,000
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CALYPTE
BIOMEDICAL CORPORATION
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Amount
of Subscription Accepted
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20,000,000
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By:
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Number
of Shares
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Name:
Xxxxxx X. Xxxxxx
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Title:
Chief Executive Officer
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1,000,000
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Number
of Shares Underlying Warrant
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