EXHIBIT 4.2
CARDIOGENESIS CORPORATION SHARE PURCHASE AGREEMENT
This SHARE PURCHASE AGREEMENT (this "Agreement"), is made and entered
into as of April 10, 2002, by and among CARDIOGENESIS CORPORATION, a California
corporation (the "Company"), and the purchasers listed on Schedule A attached
hereto (collectively, the "Purchasers" and individually, a "Purchaser").
1. AUTHORIZATION OF SALE OF THE SHARES
Subject to the terms and conditions of this Agreement, the Company has
authorized the sale of 500,000 shares (the "Shares") of common stock, no par
value (the "Common Stock"), of the Company.
2. AGREEMENT TO SELL AND PURCHASE THE SHARES
2.1 PURCHASE AND SALE
Subject to the terms and conditions of this Agreement, each Purchaser
severally agrees to purchase, and the Company agrees to sell and issue to each
Purchaser, at the Closing (as defined below) that number of Shares set forth
opposite such Purchaser's name on Schedule A attached hereto.
2.2 PURCHASE PRICE
The purchase price of each Share shall be $1.00 (the "Per Share Price").
The Company shall not, during the period beginning on the date of this Agreement
and ending ninety (90) days after the Closing Date (as defined below), sell (i)
shares of Common Stock at a price per share of less than the Per Share Price, or
(ii) options, warrants or any other securities that can be converted into, or
otherwise exchanged for, shares of the Company's common stock at a conversion,
exchange or exercise price per share of less than the Per Share Price. In the
event the Company shall, during the period beginning on the date of this
Agreement and ending ninety (90) days after the Closing Date, sell any shares of
the Company's common stock at, or any instruments that can be converted into or
otherwise exchanged for the Company's common stock (the "Subsequent Sale")
exercisable at, a price per share (the "Subsequent Purchase Price") of less than
the Per Share Price, the Company shall, within ten (10) business days of the
Subsequent Sale, pay to the Purchaser a cash amount equal to the number of
Shares times the difference between the Per Share Price and the Subsequent
Purchase Price.
3. DELIVERY OF THE SHARES AT THE CLOSING
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(a) The completion of the purchase and sale of the Shares (the
"Closing") shall occur at the offices of Xxxxxx, Xxxx & Xxxxxxxx
LLP, counsel to the Company, at 0000 Xxxxxxx Xxxx Xxxx, 00xx
Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx, at 9:00 a.m. local time on April
11, 2002 or such other time and date as may be agreed by the
parties (the "Closing Date").
(b) At the Closing, the Company shall authorize its transfer agent
(the "Transfer Agent") to issue to each Purchaser one or more
stock certificates registered in the name of such Purchaser, or
in such nominee name(s) as designated by such Purchaser in
writing, representing the number of Shares set forth in Section
2 above and bearing an appropriate legend referring to the fact
that the Shares were sold in reliance upon the exemption from
registration provided by Section 4(2) of the Securities Act of
1933, as amended (the "Securities Act"), and Rule 506 under the
Securities Act. The Company will deliver one certificate
representing 400,000 Shares and one certificate representing
100,000 Shares (the "Certificates") against delivery of payment
for the Shares by the Purchasers. Prior to the Purchasers'
delivery of payment for the Shares, the Company will deliver via
facsimile a copy of the Certificates to be delivered upon
Closing to the office of the Purchasers (at the fax number
indicated on the signature pages attached hereto).
(c) The Company's obligation to complete the purchase and sale of
the Shares shall be subject to the following conditions, any one
or more of which may be waived by the Company:
(i) receipt by the Company from stockholders holding rights to
require the Company to register the sale of any securities owned
by such holder in the Registration Statement (as defined below)
of waivers of such rights (including the waiver of any notice
requirements related to such rights);
(ii) receipt by the Company of same-day funds in the full amount of
the purchase price for the Shares being purchased under this
Agreement; and
(iii) the accuracy in all material respects of the representations and
warranties made by the Purchasers and the fulfillment in all
material respects of those undertakings of the Purchasers to be
fulfilled before the Closing.
(d) The Purchasers' obligations to accept delivery of such stock
certificates and to pay for the Shares evidenced by the
certificates shall be subject to the following conditions, any
one or more of which may be waived by a Purchaser with respect
to such Purchaser's obligation:
(i) the representations and warranties made by the Company in this
Agreement shall be accurate in all material respects and the
undertakings of the Company shall have been fulfilled in all
material respects on or before the Closing;
(ii) the Company shall have delivered to the Purchasers a certificate
executed by the chairman of the board or president and the chief
financial or accounting officer of the Company, dated the
Closing Date, in form and substance reasonably satisfactory to
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the Purchasers, to the effect that the representations and
warranties of the Company set forth in Section 4 hereof are true
and correct in all material respects as of the date of this
Agreement and as of the Closing Date, and that the Company has
complied with all the agreements and satisfied all the
conditions in this Agreement on its part to be performed or
satisfied on or before the Closing Date; and
(iii) the Company shall have delivered to Purchasers a legal opinion
in substantially the form attached hereto as Exhibit A.
(iv) the Company shall have obtained gross proceeds of at least
$500,000.00 from the sale of the Shares at the Closing.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY
Except as set forth on the Schedule of Exceptions attached hereto as
Exhibit B, the Company hereby represents and warrants to the Purchasers as
follows (which representations and warranties shall be deemed to apply, where
appropriate, to each subsidiary of the Company):
4.1 ORGANIZATION AND QUALIFICATION
The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of California. The
Company has the corporate power and authority to own, lease and operate its
properties and to conduct its business as currently conducted and to enter into
and perform its obligations under this Agreement. The Company is duly qualified
as a foreign corporation to transact business 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, singly or in the aggregate, have a material
adverse effect on the condition, financial or otherwise, or the earnings,
assets, business affairs or business prospects of the Company.
4.2 CAPITALIZATION
(a) The authorized capital stock of the Company consists of
50,000,000 shares of Common Stock and 6,600,000 shares of
Preferred Stock.
(b) As of March 31, 2002, the issued and outstanding capital stock
of the Company consists of 36,477,723 shares of Common Stock.
The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued, are fully
paid and nonassessable and have not been issued in violation of
or are not otherwise subject to any preemptive or other similar
rights.
(c) The Company has reserved 5,925,000 shares of Common Stock for
issuance upon the exercise of stock options granted or available
for future grant under the Company's stock option plans.
(d) The Company has reserved 75,000 shares of Common Stock for
issuance upon the exercise of outstanding warrants to purchase
Common Stock.
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With the exception of the foregoing, there are no outstanding
subscriptions, options, warrants, convertible or exchangeable securities or
other rights granted to or by the Company to purchase shares of Common Stock or
other securities of the Company and there are no commitments, plans or
arrangements to issue any shares of Common Stock or any security convertible
into or exchangeable for Common Stock.
4.3 ISSUANCE, SALE AND DELIVERY OF THE SHARES
(a) The Shares have been duly authorized for issuance and sale to
the Purchasers pursuant to this Agreement and, when issued and
delivered by the Company pursuant to this Agreement against
payment of the consideration set forth in this Agreement, will
be validly issued and fully paid and nonassessable and free and
clear of all pledges, liens and encumbrances. The certificates
evidencing the Shares are in due and proper form under
California law.
(b) The issuance of the Shares is not subject to preemptive or other
similar rights. No further approval or authority of the
shareholders or the Board of Directors of the Company will be
required for the issuance and sale of the Shares to be sold by
the Company as contemplated in this Agreement.
(c) Subject to the accuracy of the Purchasers' representations and
warranties in Section 5 of this Agreement, the offer, sale, and
issuance of the Shares in conformity with the terms of this
Agreement constitute transactions exempt from the registration
requirements of Section 5 of the Securities Act and from the
registration or qualification requirements of the laws of any
applicable state or United States jurisdiction.
4.4 FINANCIAL STATEMENTS
The financial statements included (as exhibits or otherwise) in the
Company Documents (as defined below) present fairly the financial position of
the Company as of the dates indicated and the results of their operations for
the periods specified. Except as otherwise stated in such Company Documents,
such financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis, and any supporting
schedules included with the financial statements present fairly the information
stated in the financial statements. The financial and statistical data set forth
in the Company Documents were prepared on an accounting basis consistent with
such financial statements.
4.5 NO MATERIAL CHANGE
Since January 18, 2002,
(a) there has been no material adverse change or any development
involving a prospective material adverse change in or affecting
the condition, financial or otherwise, or in the earnings,
assets, business affairs or business prospects of the Company,
whether or not arising in the ordinary course of business;
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(b) there have been no transactions entered into by the Company
other than those in the ordinary course of business, which are
material with respect to the Company; and
(c) there has been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock.
The Company has no material contingent obligations.
4.6 ENVIRONMENTAL
Except as would not, singly or in the aggregate, reasonably be expected
to have a material adverse effect on the condition, financial or otherwise, or
the earnings, assets, business affairs or business prospects of the Company,
(a) the Company is in compliance with all applicable Environmental
Laws (as defined below);
(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 best knowledge of the Company,
threatened Environmental Claims (as defined below) 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.
4.7 NO DEFAULTS
The Company is not in violation of its certificate of incorporation or
bylaws or in material default in the performance or observance of any
obligation, agreement, covenant or condition contained in any material contract,
indenture, mortgage, loan agreement, deed, trust, note, lease, sublease, voting
agreement, voting trust, or other instrument or material agreement to which the
Company is a party or by which it may be bound, or to which any of the property
or assets of the Company is subject.
4.8 LABOR MATTERS
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No labor dispute with the employees of the Company exists or, to the
best knowledge of the Company, is imminent.
4.9 NO ACTIONS
There is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, threatened, against or affecting the Company which,
singly or in the aggregate, might result in any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company, or which, singly or in the aggregate, might
materially and adversely affect the properties or assets thereof or which might
materially and adversely affect the consummation of this Agreement, nor, to the
best knowledge of the Company, is there any reasonable basis therefor. The
Company is not in default with respect to any judgment, order or decree of any
court or governmental agency or instrumentality which, singly or in the
aggregate, would have a material adverse effect on the assets, properties or
business of the Company.
4.10 INTELLECTUAL PROPERTY
(a) The Company, to the best of its knowledge in the course of
diligent inquiry, owns or is licensed to use all patents, patent
applications, inventions, trademarks, trade names, applications
for registration of trademarks, service marks, service xxxx
applications, copyrights, know-how, manufacturing processes,
formulae, trade secrets, licenses and rights in any thereof and
any other intangible property and assets that are material to
the business of the Company as now conducted and as proposed to
be conducted (in this Agreement called the "Proprietary
Rights"), or is seeking, or will seek, to obtain rights to use
such Proprietary Rights that are material to the business of the
Company as proposed to be conducted.
(b) The Company does not have any knowledge of, and the Company has
not given or received any notice of, any pending conflicts with
or infringement of the rights of others with respect to any
Proprietary Rights or with respect to any license of Proprietary
Rights which are material to the business of the Company.
(c) No action, suit, arbitration, or legal, administrative or other
proceeding, or investigation is pending, or, to the best
knowledge of the Company, threatened, which involves any
Proprietary Rights, nor, to the best knowledge of the Company,
is there any reasonable basis therefor.
(d) The Company is not subject to any judgment, order, writ,
injunction or decree of any court or any Federal, state, local,
foreign or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, or any
arbitrator, and has not entered into or is not a party to any
contract which restricts or impairs the use of any such
Proprietary Rights in a manner which would have a material
adverse effect on the use of any of the Proprietary Rights.
(e) The Company has not received written notice of any pending
conflict with or infringement upon any third-party proprietary
rights.
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(f) The Company has not entered into any consent, indemnification,
forbearance to xxx or settlement agreement with respect to
Proprietary Rights other than in the ordinary course of
business. No claims have been asserted by any person with
respect to the validity of the Company's ownership or right to
use the Proprietary Rights and, to the best knowledge of the
Company, there is no reasonable basis for any such claim to be
successful.
(g) The Company has complied, in all material respects, with its
obligations relating to the protection of the Proprietary Rights
which are material to the business of the Company used pursuant
to licenses.
(h) To the best knowledge of the Company, no person is infringing on
or violating the Proprietary Rights.
4.11 PERMITS
The Company possesses and is operating in compliance with all material
licenses, certificates, consents, authorities, approvals and permits from all
state, federal, foreign and other regulatory agencies or bodies necessary to
conduct the businesses now operated by it, and the Company has not received any
notice of proceedings relating to the revocation or modification of any such
permit or any circumstance which would lead it to believe that such proceedings
are reasonably likely which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially and adversely affect
the condition, financial or otherwise, or the earnings, assets, business affairs
or business prospects of the Company.
4.12 DUE EXECUTION, DELIVERY AND PERFORMANCE
(a) This Agreement has been duly executed and delivered by the
Company and constitutes a valid and binding obligation of the
Company, enforceable against the Company in accordance with its
terms.
(b) The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated in this
Agreement and the fulfillment of the terms of this Agreement,
including the sale, issuance and delivery of the Shares, (i)
have been duly authorized by all necessary corporate action on
the part of the Company, its directors and stockholders; (ii)
will not conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company
pursuant to, any contract, indenture, mortgage, loan agreement,
deed, trust, note, lease, sublease, voting agreement, voting
trust or other instrument or agreement to which the Company is a
party or by which it may be bound, or to which any of the
property or assets of the Company is subject; (iii) will not
trigger anti-dilution rights or other rights to acquire
additional equity securities of the Company; and (iv) will not
result in any violation of the provisions of the articles of
incorporation or bylaws of the Company or any applicable
statute, law, rule, regulation, ordinance, decision, directive
or order.
4.13 PROPERTIES
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The Company has good and marketable title to its properties, free and
clear of all material security interests, mortgages, pledges, liens, charges,
encumbrances and claims of record. The properties of the Company are, in the
aggregate, in good repair (reasonable wear and tear excepted), and suitable for
their respective uses. Any real property held under lease by the Company is held
under valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the conduct of the business of the Company.
The Company owns or leases all such properties as are necessary to its business
or operations as now conducted.
4.14 COMPLIANCE
The Company has conducted and is conducting its business in compliance
with all applicable Federal, state, local and foreign statutes, laws, rules,
regulations, ordinances, codes, decisions, decrees, directives and orders,
except where the failure to do so would not, singly or in the aggregate, have a
material adverse effect on the condition, financial or otherwise, or on the
earnings, assets, business affairs or business prospects of the Company.
4.15 SECURITY MEASURES
The Company takes security measures designed to enable the Company to
assert trade secret protection in its non-patented technology.
4.16 CONTRIBUTIONS
To the best of the Company's knowledge, neither the Company nor any
employee or agent of the Company has made any payment of funds of the Company or
received or retained any funds in violation of any law, rule or regulation.
4.17 USE OF PROCEEDS; INVESTMENT COMPANY
The Company intends to use the proceeds from the sale of the Shares for
working capital and other general corporate purposes. The Company is not now,
and after the sale of the Shares under this Agreement and under all other
agreements and the application of the net proceeds from the sale of the Shares
described in the proceeding sentence will not be, an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
4.18 PRIOR OFFERINGS
All offers and sales of capital stock of the Company before the date of
this Agreement were at all relevant times duly registered or exempt from the
registration requirements of the Securities Act and were duly registered or
subject to an available exemption from the registration requirements of the
applicable state securities or Blue Sky laws.
4.19 TAXES
The Company has filed all material tax returns required to be filed,
which returns are true and correct in all material respects, and the Company is
not in default in the payment of any taxes, including penalties and interest,
assessments, fees and other charges, shown thereon due or
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otherwise assessed, other than those being contested in good faith and for which
adequate reserves have been provided or those currently payable without interest
which were payable pursuant to said returns or any assessments with respect
thereto.
4.20 OTHER GOVERNMENTAL PROCEEDINGS
To the Company's knowledge, there are no rulemaking or similar
proceedings before any Federal, state, local or foreign government bodies that
involve or affect the Company, which, if the subject of an action unfavorable to
the Company, could involve a prospective material adverse change in or effect on
the condition, financial or otherwise, or in the earnings, assets, business
affairs or business prospects of the Company.
4.21 NON-COMPETITION AGREEMENTS
To the knowledge of the Company, any full-time employee who has entered
into any non-competition, non-disclosure, confidentiality or other similar
agreement with any party other than the Company is neither in violation of nor
is expected to be in violation of that agreement as a result of the business
currently conducted or expected to be conducted by the Company or such person's
performance of his or her obligations to the Company. 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.
4.22 TRANSFER TAXES
On the Closing Date, all stock transfer or other taxes (other than
income taxes) that are required to be paid in connection with the sale and
transfer of the Shares to be sold to the Purchasers under this Agreement 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.
4.23 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 theft, damage, destruction, acts of vandalism and all other
risks customarily insured against by similarly situated companies, all of which
insurance is in full force and effect.
4.24 GOVERNMENTAL/ REGULATORY CONSENTS
No registration, authorization, approval, qualification or consent with
or required by any court or governmental/ regulatory authority or agency is
necessary in connection with the execution and delivery of this Agreement or the
offering, issuance or sale of the Shares under this Agreement.
4.25 SECURITIES AND EXCHANGE COMMISSION FILINGS
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The Company has timely filed with the Securities and Exchange Commission
(the "Commission") all documents required to be filed by the Company under the
Securities Exchange Act of 1934, as amended (the "Exchange Act.")
4.26 ADDITIONAL INFORMATION
The Company represents and warrants that the information contained in
the following documents (the "Company Documents"), which will be provided to
Purchaser before the Closing, is or will be true and correct in all material
respects as of their respective final dates:
(a) the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2000;
(b) the Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 2001, June 30, 2001 and September 30,
2001;
(c) the Company's Proxy Statement for its 2001 Annual Meeting of
Shareholders; and
(d) all other documents, if any, filed by the Company with the
Commission since January 24, 2002 pursuant to the reporting
requirements of the Securities Exchange Act.
4.27 CONTRACTS
The contracts described in the Company Documents or incorporated by
reference therein are in full force and effect on the date hereof, except for
contracts the termination or expiration of which would not, singly or in the
aggregate, have a material adverse effect on the business, properties or assets
of the Company. Neither the Company nor, to the best knowledge of the Company,
any other party is in material breach of or default under any such contracts.
4.28 NO INTEGRATED OFFERING
Neither the Company, nor any of its affiliates, nor any person acting on
its or their behalf, has directly or indirectly made any offers or sales in any
security or solicited any offers to buy any security under circumstances that
would require registration under the Securities Act of the issuance of the
Shares to the Purchasers. The issuance of the Shares to the Purchasers will not
be integrated with any other issuance of the Company's securities (past, current
or future) for purposes of the Securities Act or any applicable rules of Nasdaq
(or of any national securities exchange on which the Company's Common Stock is
then traded). The Company will not make any offers or sales of any security
(other than the Shares) that would cause the offering of the Shares to be
integrated with any other offering of securities by the Company for purposes of
any registration requirement under the Securities Act or any applicable rules of
Nasdaq (or of any national securities exchange on which the Company's Common
Stock is then traded).
4.29 LISTING OF SHARES
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The Company agrees to promptly secure the listing of the Shares upon
each national securities exchange or automated quotation system upon which
shares of Common Stock are then listed and, so long as any Purchaser owns any of
the Shares, shall maintain such listing of all Shares. The Company has taken no
action designed to delist, or which is likely to have the effect of delisting,
the Common Stock from any of the national securities exchange or automated
quotation system upon which the shares of Common Stock are then listed.
4.30 NO MANIPULATION OF STOCK
The Company has not taken and will not, in violation of applicable law,
take any action outside the ordinary course of business designed to or that
might reasonably be expected to cause or result in unlawful manipulation of the
price of the Common Stock to facilitate the sale or resale of the Shares.
4.31 XXXXX II AND ANTI-KICKBACK
Company represents and warrants that it shall not knowingly sell, lease
or provide services to an entity which Company knows is in violation of the
federal Xxxxx II (42 USCA 1395nn) law ("Xxxxx II Law") and/or the federal
anti-kickback (42 USCA 1320a-7b) law ("Anti-kickback Law"). In the event Company
breaches the warranties, representations and covenants contained in this Section
4.31, Company agrees to purchase from Purchaser, upon prior written notice from
the Purchaser, the Shares purchased by Purchaser under this Agreement at a price
per share equal to the Per Share Price plus an additional 20%.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS
5.1 SECURITIES LAW REPRESENTATIONS AND WARRANTIES
Each Purchaser represents, warrants and covenants to the Company as
follows:
(a) The Purchaser is knowledgeable, sophisticated and experienced in
making, and is qualified to make, decisions with respect to
investments in shares representing an investment decision like
that involved in the purchase of the Shares, including
investments in securities issued by the Company, and has
requested, received, reviewed and considered all information it
deems relevant in making an informed decision to purchase the
Shares.
(b) The Purchaser is acquiring the number of Shares set forth in
Section 2 above in the ordinary course of its business and for
its own account for investment (as defined for purposes of the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvement Act of 1976 and the
regulations thereunder) only, and has no present intention of
distributing any of the Shares nor any arrangement or
understanding with any other persons regarding the distribution
of such Shares within the meaning of Section 2(11) of the
Securities Act, other than as contemplated in Section 7 of this
Agreement.
(c) The Purchaser will not, directly or indirectly, offer, sell,
pledge, transfer or otherwise dispose of (or solicit any offers
to buy, purchase or otherwise acquire or
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take a pledge of) any of the Shares except in compliance with
the Securities Act and the rules and regulations promulgated
thereunder (the "Rules and Regulations").
(d) The Purchaser has completed or caused to be completed the Stock
Certificate Questionnaire and the Registration Statement
Questionnaire, attached to this Agreement as Appendices I and
II, for use in preparation of the Registration Statement (as
defined in Section 7.3 below), and the answers to the
Questionnaires are true and correct as of the date of this
Agreement and will be true and correct as of the effective date
of the Registration Statement; provided that the Purchasers
shall be entitled to update such information by providing notice
thereof to the Company before the effective date of such
Registration Statement.
(e) The Purchaser has, in connection with its decision to purchase
the number of Shares set forth in Section 2 above, relied solely
upon the Company Documents and the representations and
warranties of the Company contained in this Agreement.
(f) The Purchaser is an "accredited investor" within the meaning of
Rule 501 of Regulation D promulgated under the Securities Act.
5.2 RESALES OF SHARES
(a) The Purchaser hereby covenants with the Company not to make any
sale of the Shares without satisfying the requirements of the
Securities Act and the Rules and Regulations, including, in the
event of any resale under the Registration Statement, the
prospectus delivery requirements under the Securities Act, and
the Purchaser acknowledges and agrees that such Shares are not
transferable on the books of the Company pursuant to a resale
under the Registration Statement unless the certificate
submitted to the transfer agent evidencing the Shares is
accompanied by a separate officer's certificate
(i) in the form of Appendix III to this Agreement;
(ii) executed by an officer of, or other authorized person designated
by, the Purchaser; and
(iii) to the effect that (A) the Shares have been sold in accordance
with the Registration Statement and (B) the requirement of
delivering a current prospectus has been satisfied.
(b) The Purchaser acknowledges that there may occasionally be times
when the Company determines, in good faith following
consultation with its Board of Directors or a committee thereof,
the use of the prospectus forming a part of the Registration
Statement (the "Prospectus," as further defined in Section 7.3.1
below) should be suspended until such time as an amendment or
supplement to the Registration Statement or the Prospectus has
been filed by the Company and any such amendment to the
Registration Statement is declared effective by the Commission,
or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The
Purchaser hereby covenants that it will not sell any Shares
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pursuant to the Prospectus during the period commencing at the
time at which the Company gives the Purchaser written notice of
the suspension of the use of the Prospectus and ending at the
time the Company gives the Purchaser written notice that the
Purchaser may thereafter effect sales pursuant to the
Prospectus. The Company may, upon written notice to the
Purchasers, suspend the use of the Prospectus for up to thirty
(30) days in any 365-day period based on the reasonable
determination of the Company's Board of Directors that there is
a significant business purpose for such determination, such as
pending corporate developments, public filings with the SEC or
similar events. The Company shall in no event be required to
disclose the business purpose for which it has suspended the use
of the Prospectus if the Company determines in its good faith
judgment that the business purpose should remain confidential.
In addition, the Company shall notify each Purchaser (i) of any
request by the SEC for an amendment or any supplement to such
Registration Statement or any related prospectus, or any other
information request by any other governmental agency directly
relating to the offering, and (ii) of the issuance by the SEC of
any stop order suspending the effectiveness of such Registration
Statement or of any order preventing or suspending the use of
any related prospectus or the initiation or threat of any
proceeding for that purpose.
(c) The Purchaser further covenants to notify the Company promptly
of the sale of any of its Shares, other than sales pursuant to a
Registration Statement contemplated in Section 7 of this
Agreement or sales upon termination of the transfer restrictions
pursuant to Section 7.4 of this Agreement.
5.3 DUE EXECUTION, DELIVERY AND PERFORMANCE
(a) This Agreement has been duly executed and delivered by the
Purchaser and constitutes a valid and binding obligation of the
Purchaser, enforceable against the Purchaser in accordance with
its terms.
(b) The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated in this
Agreement and the fulfillment of the terms of this Agreement
have been duly authorized by all necessary corporate, agency or
other action and will not conflict with or constitute a breach
of, or default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of
the Purchaser pursuant to, any contract, indenture, mortgage,
loan agreement, deed, trust, note, lease, sublease, voting
agreement, voting trust or other instrument or agreement to
which the Purchaser is a party or by which it or any of them may
be bound, or to which any of the property or assets of the
Purchaser is subject, nor will such action result in any
violation of the provisions of the charter or bylaws of the
Purchaser or any applicable statute, law, rule, regulation,
ordinance, decision, directive or order.
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 Purchasers in this
14
Agreement and in the certificates for the Shares delivered pursuant to this
Agreement shall survive the execution of this Agreement, the delivery to the
Purchasers of the Shares being purchased and the payment therefor.
7. FORM D FILING; REGISTRATION; COMPLIANCE WITH THE SECURITIES ACT;
COVENANTS
7.1 FORM D FILING; REGISTRATION OF SHARES
7.1.1 REGISTRATION STATEMENT; EXPENSES
The Company shall:
(a) file in a timely manner a Form D relating to the sale of the
Shares under this Agreement, pursuant to Securities and Exchange
Commission Regulation D.
(b) as soon as practicable after the Closing Date, but in no event
later than the 30th day following the Closing Date, prepare and
file with the Commission a Registration Statement on Form S-3
(or, if the Company is ineligible to use Form S-3, then on Form
S-1) relating to the sale of the Shares by the Purchasers from
time to time on the Nasdaq National Market (or the facilities of
any national securities exchange on which the Company's Common
Stock is then traded) or in privately negotiated transactions
(the "Registration Statement");
(c) provide to Purchasers any information required to permit the
sale of the Shares under Rule 144A of the Securities Act;
(d) subject to receipt of necessary information from the Purchasers,
use its best efforts to cause the Commission to notify the
Company of the Commission's willingness to declare the
Registration Statement effective on or before 90 days after the
Closing Date;
(e) notify Purchasers promptly upon the Registration Statement, and
any post-effective amendment thereto, being declared effective
by the Commission;
(f) prepare and file with the Commission such amendments and
supplements to the Registration Statement and the Prospectus (as
defined in Section 7.3.1 below) and take such other action, if
any, as may be necessary to keep the Registration Statement
effective until the earlier of (i) the date on which the Shares
may be resold by the Purchasers without registration and without
regard to any volume limitations by reason of Rule 144(k) under
the Securities Act or any other rule of similar effect or (ii)
all of the Shares have been sold pursuant to the Registration
Statement or Rule 144 under the Securities Act or any other rule
of similar effect;
(g) promptly furnish to the Purchasers with respect to the Shares
registered under the Registration Statement such reasonable
number of copies of the Prospectus, including any supplements to
or amendments of the Prospectus, in order to facilitate the
public sale or other disposition of all or any of the Shares by
the Purchasers;
15
(h) during the period when copies of the Prospectus are required to
be delivered under the Securities Act or the Exchange Act, will
file all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the Exchange Act within the
time periods required by the Exchange Act and the rules and
regulations promulgated thereunder;
(i) file documents required of the Company for customary Blue Sky
clearance in all states requiring Blue Sky clearance; 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; and
(j) bear all expenses in connection with the procedures in
paragraphs (a) through (i) of this Section 7.1.1 and the
registration of the Shares pursuant to the Registration
Statement.
7.1.2 DELAY IN EFFECTIVENESS OF REGISTRATION STATEMENT
In the event that the Registration Statement is not declared effective
on or before ninety (90) days from the Closing Date (the "Penalty Date"), the
Company shall pay to each Purchaser liquidated damages in an amount equal to
0.25% of the total purchase price of the Shares purchased by such Purchaser
pursuant to this Agreement for each week after the Penalty Date that the
Registration Statement is not declared effective.
7.2 TRANSFER OF SHARES AFTER REGISTRATION
Each Purchaser 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 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 Purchaser or its plan of
distribution.
7.3 INDEMNIFICATION
For the purpose of this Section 7.3, the term "Registration Statement"
shall include any preliminary or final prospectus, exhibit, supplement or
amendment included in or relating to the Registration Statement referred to in
Section 7.1.
7.3.1 INDEMNIFICATION BY THE COMPANY
The Company agrees to indemnify and hold harmless each of the Purchasers
and each person, if any, who controls any Purchaser within the meaning of the
Securities Act, against any losses, claims, damages, liabilities or expenses,
joint or several, to which such Purchasers or such controlling person may become
subject, under the Securities Act, the Exchange Act, or any other federal or
state statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Company, which consent shall not be unreasonably withheld),
insofar as such losses, claims, damages, liabilities or expenses (or actions in
respect thereof as contemplated below) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained
16
in the Registration Statement, including the Prospectus, financial statements
and schedules, and all other documents filed as a part thereof, as amended at
the time of effectiveness of the Registration Statement, including any
information deemed to be a part thereof as of the time of effectiveness pursuant
to paragraph (b) of Rule 430A, or pursuant to Rule 434, of the Rules and
Regulations, or the Prospectus, in the form first filed with the Commission
pursuant to Rule 424(b) of the Regulations, or filed as part of the Registration
Statement at the time of effectiveness if no Rule 424(b) filing is required (the
"Prospectus"), or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state in any of them a material
fact required to be stated therein or necessary to make the statements in any of
them, in light of the circumstances under which they were made, not misleading,
or arise out of or are based in whole or in part on any inaccuracy in the
representations and warranties of the Company contained in this Agreement, or
any failure of the Company to perform its obligations under this Agreement or
under applicable law, and will reimburse each Purchaser and each such
controlling person for any legal and other expenses as such expenses are
reasonably incurred by such Purchaser or such controlling person in connection
with investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action; provided, however, that the Company
will not be liable in any such case to the extent that any such loss, claim,
damage, liability or expense arises out of or is based upon (i) an untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, the Prospectus or any amendment or supplement of the
Registration Statement or Prospectus in reliance upon and in conformity with
written information furnished to the Company by or on behalf of the Purchaser
expressly for use in the Registration Statement or the Prospectus, or (ii) the
failure of such Purchaser to comply with the covenants and agreements contained
in Sections 5.2 or 7.2 of this Agreement respecting resale of the Shares, or
(iii) the inaccuracy of any representations made by such Purchaser in this
Agreement or (iv) any untrue statement or omission of a material fact required
to make such statement not misleading in any Prospectus that is corrected in any
subsequent Prospectus that was delivered to the Purchaser before the pertinent
sale or sales by the Purchaser.
17
7.3.2 INDEMNIFICATION BY THE PURCHASER
Each Purchaser will severally and not jointly indemnify and hold
harmless the Company, each of its directors, each of its officers who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of the Securities Act, against any losses, claims, damages,
liabilities or expenses to which the Company, each of its directors, each of its
officers who signed the Registration Statement or controlling person may become
subject, under the Securities Act, the Exchange Act, or any other federal or
state statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Purchaser, which consent shall not be unreasonably withheld)
insofar as such losses, claims, damages, liabilities or expenses (or actions in
respect thereof as contemplated below) arise out of or are based upon (i) any
failure on the part of such Purchaser to comply with the covenants and
agreements contained in Sections 5.2 or 7.2 of this Agreement respecting the
sale of the Shares or (ii) the inaccuracy of any representation made by such
Purchaser in this Agreement or (iii) any untrue or alleged untrue statement of
any material fact contained in the Registration Statement, the Prospectus, or
any amendment or supplement to the Registration Statement or Prospectus, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser expressly
for use therein; provided, however, that the Purchaser shall not be liable for
any such untrue or alleged untrue statement or omission or alleged omission of
which the Purchaser has delivered to the Company in writing a correction before
the occurrence of the transaction from which such loss was incurred, and the
Purchaser will reimburse the Company, each of its directors, each of its
officers who signed the Registration Statement or controlling person for any
legal and other expense reasonably incurred by the Company, each of its
directors, each of its officers who signed the Registration Statement or
controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action.
7.3.3 INDEMNIFICATION PROCEDURE
(a) Promptly after receipt by an indemnified party under this
Section 7.3 of notice of the threat or commencement of any
action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this
Section 7.3, promptly notify the indemnifying party in writing
of the claim; but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have
to any indemnified party for contribution or otherwise under the
indemnity agreement contained in this Section 7.3 or to the
extent it is not prejudiced as a result of such failure.
(b) In case any such action is brought against any indemnified party
and such indemnified party seeks or intends to seek indemnity
from an indemnifying party, the indemnifying party will be
entitled to participate in, and, to the extent that it may wish,
jointly with all other indemnifying parties similarly notified,
to assume the
18
defense thereof with counsel reasonably satisfactory to such
indemnified party; provided, however, if the defendants in any
such action include both the indemnified party and the
indemnifying party and the indemnified party shall have
reasonably concluded that there may be a conflict between the
positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be
legal defenses available to it or other indemnified parties that
are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon
receipt of notice from the indemnifying party to such
indemnified party of its election so to assume the defense of
such action and approval by the indemnified party of counsel,
the indemnifying party will not be liable to such indemnified
party under this Section 7.3 for any legal or other expenses
subsequently incurred by such indemnified party in connection
with the defense thereof unless:
(i) the indemnified party shall have employed such counsel in
connection with the assumption of legal defenses in accordance
with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel, approved by such
indemnifying party representing all of the indemnified parties
who are parties to such action) or
(ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of
commencement of action, in each of which cases the reasonable
fees and expenses of counsel shall be at the expense of the
indemnifying party. Notwithstanding the provisions of this
Section 7.3, the Purchaser shall not be liable for any
indemnification obligation under this Agreement in excess of the
amount of net proceeds received by the Purchaser from the sale
of the Shares.
7.3.4 CONTRIBUTION
If the indemnification provided for in this Section 7.3 is required by
its terms but is for any reason held to be unavailable to or otherwise
insufficient to hold harmless an indemnified party under this Section 7.3 in
respect to any losses, claims, damages, liabilities or expenses referred to in
this Agreement, then each applicable indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of any losses,
claims, damages, liabilities or expenses referred to in this Agreement
(a) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Purchaser from the
placement of Common Stock or
(b) if the allocation provided by clause (a) above is not permitted
by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (a)
above but the relative fault of the Company and the Purchaser in
connection with the statements or omissions or inaccuracies in
the representations and
19
warranties in this Agreement that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations.
The respective relative benefits received by the Company on the one hand
and each Purchaser on the other shall be deemed to be in the same proportion as
the amount paid by such Purchaser to the Company pursuant to this Agreement for
the Shares purchased by such Purchaser that were sold pursuant to the
Registration Statement bears to the difference (the "Difference") between the
amount such Purchaser paid for the Shares that were sold pursuant to the
Registration Statement and the amount received by such Purchaser from such sale.
The relative fault of the Company and each Purchaser shall be determined by
reference to, among other things, whether the untrue or alleged statement of a
material fact or the omission or alleged omission to state a material fact or
the inaccurate or the alleged inaccurate representation or warranty relates to
information supplied by the Company or by such Purchaser and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable by a party as a
result of the losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include, subject to the limitations set forth in
Section 7.3.3, any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim. The
provisions set forth in Section 7.3.3 with respect to the notice of the threat
or commencement of any threat or action shall apply if a claim for contribution
is to be made under this Section 7.3.4; provided, however, that no additional
notice shall be required with respect to any threat or action for which notice
has been given under Section 7.3 for purposes of indemnification. The Company
and each Purchaser agree that it would not be just and equitable if contribution
pursuant to this Section 7.3 were determined solely by pro rata allocation (even
if the Purchaser were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to in this paragraph. Notwithstanding the provisions of this Section
7.3, no Purchaser shall be required to contribute any amount in excess of the
amount by which the Difference exceeds the amount of any damages that such
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. 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 Purchasers' obligations to contribute pursuant
to this Section 7.3 are several and not joint.
7.4 TERMINATION OF CONDITIONS AND OBLIGATIONS
The restrictions 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 upon the passage of two years from the Closing Date or at
such time as an opinion of counsel satisfactory in form and substance 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
From the date of this Agreement through the date the Registration
Statement covering the resale of Shares owned by any Purchaser is no longer
effective, the Company will furnish to such Purchaser:
20
(a) as soon as practicable after available (but in the case of the
Company's Annual Report to Shareholders, within 90 days after
the end of each fiscal year of the Company), one copy of
(i) its Annual Report to Shareholders (which Annual Report shall
contain financial statements audited in accordance with
generally accepted accounting principles by a national firm of
certified public accountants);
(ii) if not included in substance in the Annual Report to
Shareholders, its Annual Report on Form 10-K;
(iii) if not included in substance in its Quarterly Reports to
Shareholders, its quarterly reports on Form 10-Q; and
(iv) a full copy of the particular Registration Statement covering
the Shares (the foregoing, in each case, excluding exhibits);
(b) upon the request of the Purchaser, a reasonable number of copies
of the Prospectus to supply to any other party requiring the
Prospectus.
7.6 RULE 144 INFORMATION
Until the earlier of (i) the date on which the Shares may be resold by
the Purchasers without registration and without regard to any volume limitations
by reason of Rule 144(k) under the Securities Act or any other rule of similar
effect or (ii) all of the Shares have been sold pursuant to the Registration
Statement or Rule 144 under the Securities Act or any other rule of similar
effect, the Company shall file all reports required to be filed by it under the
Securities Act, the Rules and Regulations and the Exchange Act and shall take
such further action to the extent required to enable the Purchasers to sell the
Shares pursuant to Rule 144 under the Securities Act (as such rule may be
amended from time to time).
8. LEGAL FEES AND OTHER TRANSACTION EXPENSES
At the Closing, the Company agrees to pay a flat fee of $5,000 to the
State of Wisconsin Investment Board for their legal and other transaction
expenses (whether internal or external) arising in connection with the
transactions contemplated by this Agreement.
9. BROKER'S FEE
The Purchasers acknowledge that the Company does not intend to pay any
fee in respect of the sale of the Shares. Each of the parties to this Agreement
hereby represents that, on the basis of any actions and agreements by it, there
are no brokers or finders entitled to compensation in connection with the sale
of the Shares to the Purchasers. The Company shall indemnify and hold harmless
the Purchasers from and against all fees, commissions or other payments owing by
the Company to any person or firm acting on behalf of the Company hereunder.
21
10. NOTICES
All notices, requests, consents and other communications under this
Agreement shall be in writing, shall be mailed by first-class registered or
certified airmail, confirmed facsimile or nationally recognized overnight
express courier postage prepaid, and shall be delivered as addressed as follows:
22
(a) if to the Company, to:
CardioGenesis CORPORATION
00000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxx, XX 00000
Attn: Chief Executive Officer
or to such other person at such other place as the Company shall designate to
the Purchaser in writing; and
(b) if to a Purchaser, at its address as set forth on the signature
page to this Agreement, or at such other address or addresses as
may have been furnished to the Company in writing.
Such notice shall be deemed effectively given upon confirmation of
receipt by facsimile, one business day after deposit with such overnight courier
or three days after deposit of such registered or certified airmail with the
U.S. Postal Service, as applicable.
11. MODIFICATION; AMENDMENT
This Agreement may not be modified or amended except pursuant to an
instrument in writing signed by the Company and each of the Purchasers.
12. TERMINATION
This Agreement may be terminated as to any Purchaser, at the option of
such Purchaser, if the Closing has not occurred on or before thirty (30) days
from the date of this Agreement.
13. 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.
14. SEVERABILITY
If any provision contained in this Agreement should be held to be
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained in this Agreement shall not
in any way be affected or impaired thereby.
15. GOVERNING LAW; JURISDICTION
This Agreement shall be governed by and construed in accordance with the
laws of the state of California and the federal law of the United States of
America. The parties hereto hereby submit to the jurisdiction of the courts of
the State of Wisconsin, or of the United States of America sitting in the State
of Wisconsin, over any action, suit, or proceeding arising out of or relating to
this Agreement. Nothing herein shall affect the right of the Purchaser to serve
process in any manner permitted by law or limit the right of the Purchaser to
bring proceedings against the Company in the competent courts of any other
jurisdiction or jurisdictions.
23
16. NO CONFLICTS OF INTEREST
The Company represents, warrants, and covenants that, to the best of its
knowledge, no trustee or employee of the State of Wisconsin Investment Board
identified on the attached list, either directly or indirectly (a) currently
holds, except as may be specifically set forth below, a personal interest in the
Company or any of its affiliates (together, the "Entity") or the Entity's
property or securities, or (b) will, in connection with the investment made
pursuant to this Agreement, receive (i) a personal interest in the Entity or the
Entity's property or securities or (ii) anything of substantial economic value
for his or her private benefit from the Entity or anyone acting on its behalf.
As to ownership of an interest in the Entity's publicly traded securities,
"knowledge" hereunder is based on an examination of record holders of the
Entity's securities and actual knowledge of the undersigned.
17. 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 to this Agreement and delivered to
the other parties.
IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be executed by their duly authorized representatives as of the day
and year first above written.
CARDIOGENESIS CORPORATION
By /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxx
Its: President, Chief Executive
Officer and Chairman
STATE OF WISCONSIN INVESTMENT BOARD
By: /s/ Xxxx X. Xxxxxx
--------------------------------
Name: Xxxx X. Xxxxxx
-----------------------------
Title: Investment Director
----------------------------
Address:
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
SCHEDULE A
PURCHASER
STATE OF WISCONSIN INVESTMENT BOARD
(Purchasing an aggregate of 500,000 shares of CardioGenesis Common Stock).
EXHIBIT A
April __, 2002
(000) 000-0000 C 26399-00001
State of Wisconsin Investment Board
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Re: CardioGenesis Corporation
Dear Sir/Madam:
We have acted as legal counsel to CardioGenesis Corporation, a
California corporation (the "Company"), in connection with (i) the issuance and
sale by the Company to you of five hundred thousand (500,000) shares (the
"Shares") of its common stock, no par value per share (the "Common Stock"),
pursuant to a Share Purchase Agreement dated as of April 10, 2001 (the "Purchase
Agreement") and (ii) the negotiation of the provisions of the Purchase
Agreement. Capitalized terms used herein, but not otherwise defined herein,
shall have the meanings ascribed to those terms in the Purchase Agreement.
For the purpose of rendering this opinion, we have investigated such
questions of law as we have deemed necessary. As to factual matters, we have
relied, with your permission and without verification, on the representations
and warranties as to facts set forth in the Purchase Agreement and such
certificates and statements of the Company and its officers as we have deemed
necessary. In addition, we have obtained and relied upon, with your permission,
such other certificates and assurances from public officials as we have deemed
necessary, desirable or appropriate for the purpose of rendering the opinions
expressed herein.
We have assumed, with your permission, the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, the
conformity to originals of all documents submitted to us as copies and the
authenticity of the originals of such copied documents. We have assumed that
each of the parties to the Purchase Agreement other than the Company have the
power, authority and legal right to enter into and perform the terms and
conditions on the part of such party to be performed, and the due authorization,
execution and
delivery by such party of the Purchase Agreement. We have further assumed that
the Purchase Agreement constitutes the legal, valid and binding obligation of
the parties thereto other than the Company, enforceable against such other
parties in accordance with its terms.
We have assumed, with your permission, that there are no documents,
agreements, understandings or negotiations between you and the Company which
would expand, modify or otherwise affect the respective rights and obligations
of the parties set forth in the Purchase Agreement and that the Purchase
Agreement correctly and completely sets forth the intent of all parties thereto.
Based on the foregoing and in reliance thereon, and subject to the
assumptions, exceptions, qualifications and limitations set forth herein, we are
of the opinion that:
1. The Company has been duly incorporated and is validly existing in
good standing under the laws of the State of California. The Company is duly
qualified as a foreign corporation to transact business 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, singly or in the aggregate, have a material
adverse effect on the condition, financial or otherwise, or the earnings,
assets, business affairs or business prospects of the Company. The Company has
the requisite corporate power to own or lease its property and assets and to
conduct its business as currently conducted.
2. The Purchase Agreement has been duly authorized by all necessary
corporate action on the part of the Company and has been duly executed and
delivered on behalf of the Company and constitutes a valid and binding agreement
of the Company, enforceable against the Company in accordance with its terms
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium and other laws of general applicability relating to or
affecting creditors' rights, and (ii) as limited by equitable principles
generally and limitations on the availability of equitable remedies, whether
such enforceability is considered in a proceeding in equity or at law.
3. The Shares have been duly authorized and when issued, delivered and
paid for in accordance with the terms of the Agreement, will be validly issued,
fully paid and nonassessable and free of any pre-emptive or similar rights.
4. Except as set forth in the Purchase Agreement, to our knowledge,
there is no action, proceeding or investigation pending or overtly threatened in
writing against the Company which could reasonably be anticipated to result,
either individually or in the aggregate, in any material adverse change in the
assets, financial condition or operations of the Company, or which questions the
validity or enforceability of, or seeks to enjoin or invalidate, the Purchase
Agreement or any action to be taken by the Company in connection therewith.
5. The offer and sale of the Shares by the Company to you is exempt from
the registration requirements of the Securities Act of 1933, as amended, subject
to timely filing of a Form D pursuant to Securities and Exchange Commission
Regulation D.
6. The execution, delivery and performance of the Purchase Agreement by
the Company and the consummation of the issuance and sale of the Shares by the
Company as
3
contemplated therein do not conflict with or violate any provisions of the
Company's Articles of Incorporation or By-laws or any provision of any
applicable material federal or state law, rule or regulation; or, to the best of
our knowledge, any material agreements to which the Company is a party.
7. All consents, approvals, authorizations, or orders of, and filings,
registrations and qualifications with any regulatory authority or governmental
body in the United States required for the issuance by the Company of the Shares
as contemplated by the Purchase Agreement, have been made or obtained, except
for (i) the filing of a Form D pursuant to Securities and Exchange Commission
Regulation D, and (ii) the filing of a Form D with the Securities Commissioners
of the State of California.
The foregoing opinions are subject to the following assumptions,
exceptions, qualifications and limitations:
A. We express no opinion as to the legality, validity, binding effect or
enforceability of any choice of law, arbitration, submission to jurisdiction or
service of process provisions or any severability provisions.
B. We express no opinion as to the legality, validity, binding nature or
enforceability of any provision in the Purchase Agreement: (i) indemnifying a
party or requiring contribution from a party, to the extent such provision may
be held unenforceable as contrary to or limited by federal or state securities
laws or public policy, including without limitation provisions indemnifying a
party against losses attributable to or liability for its own negligent acts;
(ii) providing for the payment or reimbursement of costs and expenses or
indemnification for claims, losses or liabilities in excess of a reasonable
amount determined by any court or other tribunal; or (iii) regarding the ability
of any party to collect attorneys' fees and costs in an action involving the
Purchase Agreement.
C. We express no opinion as to the legality, validity, binding effect or
enforceability of any provisions of the Purchase Agreement regarding: (i) the
remedies available to any party; (ii) the ability of any party to take
discretionary action which is arbitrary, unreasonable or capricious, or is not
taken in good faith or in a commercially reasonable manner, whether or not such
action is permitted under the Purchase Agreement; or (iii) for violations or
breaches which are determined by a court to be non-material or without
substantial adverse effect upon the ability of the obligor to perform its
material obligations thereunder.
D. We express no opinion as to the legality, validity, binding nature or
enforceability of any: (i) waiver of unknown future rights or waiver of rights
existing, or duties owed, that are broadly or vaguely stated or that do not
describe the right or duty purportedly waived with reasonable specificity, or
(ii) waiver or consent (whether or not characterized as a waiver or consent in
the Purchase Agreement) relating to the rights of the Company or duties owing to
it existing as a matter of law, to the extent such waiver or consent is found to
be against public policy.
E. We express no opinion as to the legality, validity, binding nature or
enforceability of any provisions of the Purchase Agreement requiring written
amendments or waivers insofar as
4
it suggests that oral or other modifications, amendments or waivers could not be
effectively agreed upon by the parties.
F. We express no opinion as to the legality, validity, binding nature or
enforceability of any provision in the Purchase Agreement to the effect that
rights or remedies are not exclusive, that every right or remedy is cumulative
and may be exercised in addition to any other right or remedy, that the election
of some particular remedy does not preclude recourse to one or more others or
that failure to exercise or delay in exercising rights or remedies will not
operate as a waiver of any such right or remedy.
G. We express no opinion as to any anti-fraud provision of any
securities laws or antitrust laws, regulations or rules.
H. We express no opinion as to the ability to obtain specific
performance, injunctive relief or other equitable relief as a remedy for
noncompliance with the Purchase Agreement.
With respect to any opinion herein in regard to the existence or absence
of facts that is stated to be "to our knowledge," "to the best of our knowledge"
or "known to us," such statement means that, during the course of our
representation of the Company in this matter or any other matter, no information
has come to the attention of the lawyers in our firm participating in such
representation that has given them actual knowledge of facts contrary to the
existence or absence of the facts indicated. However, we have not undertaken any
independent investigation to determine the existence or absence of such facts,
and no inference as to our knowledge of the existence or absence of such facts
should be drawn from our representation of the Company in this matter.
We are admitted to practice in the State of California. We render no
opinion herein as to matters involving the laws of any jurisdiction other than
the State of California and the federal laws of the United States of America.
This opinion is limited to the laws set forth above, as such laws presently
exist, to present judicial interpretations thereof and to the facts as they
presently exist. In rendering this opinion, we assume no obligation to revise or
supplement this opinion should the present laws of the jurisdictions mentioned
herein be changed by legislative action, judicial decision or otherwise. This
opinion is rendered as of the date hereof, and we express no opinion as to, and
disclaim any undertaking or obligation to update this opinion in respect of,
changes of circumstances or events which occur subsequent to this date.
This opinion is rendered in connection with the Purchase Agreement, and
may not be relied upon by any person other than you or by you in any other
context. The opinions expressed herein are solely for your benefit in connection
with the transactions contemplated by the Purchase Agreement. This opinion may
not be quoted in whole or in part nor may copies hereof be delivered to any
other person without our prior written consent.
Very truly yours,
5
EXHIBIT B
SCHEDULE OF EXCEPTIONS
-NONE-
EXHIBIT C
TRUSTEES OF THE STATE OF WISCONSIN INVESTMENT BOARD
Xxx X. Xxxxxx Xxxxx XxXxxxxxx
Xxxx Xxxxxxxx III Xxxxxx X. Xxxxxxxxxx
Xxxx X. Xxxxxxxxxxx Xxxxx X. Xxxxxx
Xxxxxx Xxxxx Xxxxxxxx Xxxxxxx X. Xxxxx
Xxxxx X. Xxxxx
RELEVANT EMPLOYEES OF THE STATE OF WISCONSIN INVESTMENT BOARD
ALL TRANSACTIONS
Xxxxxxxx Xxxxxx Executive Director
Xxxx Xxxxxxx Chief Investment Officer -- Equities
Xxx Xxxxxx Chief Investment Officer -- Fixed Income
Xxxxx Xxxxxxx Chief Legal Counsel
Xxxxxx Xxx Assistant Legal Counsel
Xxxxxxx Xxxxxxx Assistant Legal Counsel
FOR SMALL CAP PORTFOLIO DIRECT PLACEMENTS
Xxxx Xxxxxx Investment Director
Xxxx Xxxxxxx Assistant Portfolio Manager
Xxxxxx Xxxxxx Portfolio Manager-Health Care Sector
Xxx Xxxxxx Securities Analyst
Xxx Xxxx Securities Analyst
APPENDIX I
CARDIOGENESIS CORPORATION
STOCK CERTIFICATE QUESTIONNAIRE
Pursuant to Section 3 of the Agreement, please provide us with the
following information:
1. The exact name that your Shares are to be registered in (this is the
name that will appear on your stock certificate(s)). You may use a
nominee name if appropriate:
__________________________________
2. The relationship between the Purchaser of the Shares and the Registered
Holder listed in response to item 1 above: _____________________________
3. The mailing address of the Registered Holder listed in response to item
1 above:
__________________________________
__________________________________
__________________________________
__________________________________
4. The Social Security Number or Tax Identification Number of the
Registered Holder listed in response to item 1 above:
__________________________________
APPENDIX II
CARDIOGENESIS CORPORATION
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement, please
provide us with the following information:
5. Pursuant to the "Selling Shareholder" section of the Registration
Statement, please state your or your organization's name exactly as it
should appear in the Registration Statement:
________________________________________________________
6. Please provide the number of shares that you or your organization will
own immediately after Closing, including those Shares purchased by you
or your organization pursuant to this Purchase Agreement and those
shares purchased by you or your organization through other transactions:
_____________________________________________
7. Have you or your organization had any position, office or other material
relationship within the past three years with the Company or its
affiliates?
_____ Yes _____ No
If yes, please indicate the nature of any such relationships below:
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________
APPENDIX III
CARDIOGENESIS CORPORATION
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
The undersigned, an officer of, or other person duly authorized by
________________________________________________________________________________
[fill in official name of individual or institution]
hereby certifies that he/she/it is the Purchaser of the shares evidenced by the
attached certificate, and as such, sold such shares on ________________, 200__
in accordance with Registration Statement number 333-________________, and
complied with the requirement of delivering a current prospectus in connection
with such sale.
PRINT OR TYPE:
Name of Purchaser (Individual or Institution):
________________________________________________________________________________
Name of Individual representing Purchaser (if an Institution)
________________________________________________________________________________
Title of Individual representing Purchaser (if an Institution):
________________________________________________________________________________
SIGNATURE:
Individual Purchaser or Individual representing Purchaser:
________________________________________________________________________________
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