Exhibit 10.65
PURCHASE AGREEMENT
This PURCHASE AGREEMENT (this "Agreement"), dated as of August 28, 2000, is
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entered into by and between Myriad Genetics Inc., a Delaware corporation with
offices at 000 Xxxxxx Xxx, Xxxx Xxxx Xxxx, Xxxx 00000 (the "Company"), and Acqua
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Wellington North American Equities Fund, Ltd., a company organized under the
laws of the Commonwealth of the Bahamas, with offices c/o Fortis Fund Services
(Bahamas) Ltd., Xxxxxxxx Xxxxxxxx Centre, East Bay Street, P. O. Box SS-6238,
Nassau, Bahamas (the "Purchaser"), for the purchase and sale of shares of the
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common stock, par value $0.01 per share (the "Common Stock"), of the Company by
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the Purchaser, in the manner, and upon the terms, provisions and conditions set
forth in this Agreement.
WHEREAS, the parties desire that, upon the terms and subject to the
conditions contained herein, the Company shall issue and sell to the Purchaser
and Purchaser shall purchase shares of Common Stock; and
WHEREAS, such purchase and sale will be made in reliance upon the
provisions of Section 4(2) and Rule 506 of Regulation D ("Regulation D") of the
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United States Securities Act of 1933, as amended and regulations promulgated
thereunder (the "Securities Act"), or upon such other exemption from the
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registration requirements of the Securities Act as may be available with respect
to any or all of the purchases of Common Stock to be made hereunder.
NOW, THEREFORE, in consideration of the representations, warranties and
agreements contained herein and other good and valuable consideration, the
receipt and legal adequacy of which is hereby acknowledged by the parties, the
Company and the Purchaser hereby agree as follows:
1. Purchase Price.
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(a) Upon the following terms and subject to the conditions contained
herein, the Purchaser hereby agrees to purchase 175,000 shares of the
Company's Common Stock (the "Shares") at a per share price of $126.25 and
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for an aggregate purchase price of $22,093,750 (the "Purchase Price").
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(b) The Company has authorized and has reserved and covenants to
continue to reserve, free of preemptive rights and other similar contractual
rights of stockholders, a sufficient number of its authorized but unissued
shares of its Common Stock, to effect the issuance of the Shares.
(c) The closing under this Agreement shall take place at the offices
of the Xxxxxx Xxxxxx LLP, The Chrysler Building, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 at 1:00 p.m. (eastern time) upon the satisfaction of each of the
conditions set forth in Section 5 hereof (the "Closing Date").
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2. Representations, Warranties and Covenants of the Purchaser. The
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Purchaser represents and warrants to the Company, and covenants for the benefit
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of the Company, as follows:
(a) This Agreement has been duly authorized, validly executed and
delivered by the Purchaser and is a valid and binding agreement and obligation
of the Purchaser enforceable against the Purchaser in accordance with its terms,
subject to limitations on enforcement by general principles of equity and by
bankruptcy or other laws affecting the enforcement of creditors' rights
generally, and the Purchaser has full power and authority to execute and deliver
this Agreement and the other agreements and documents contemplated hereby and to
perform its obligations hereunder and thereunder.
(b) The Purchaser has received and carefully reviewed copies of the
Public Documents (as hereinafter defined). The Purchaser understands that no
Federal, state, local or foreign governmental body or regulatory authority has
made any finding or determination relating to the fairness of an investment in
any of the Shares and that no Federal, state, local or foreign governmental body
or regulatory authority has recommended or endorsed, or will recommend or
endorse, any investment in any of the Shares. The Purchaser, in making the
decision to purchase the Shares, has relied upon independent investigation made
by it and has not relied on any information or representations made by third
parties.
(c) The Purchaser understands that the Shares are being offered and
sold to it in reliance on specific provisions of Federal and state securities
laws and that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of
the Purchaser set forth herein for purposes of qualifying for exemptions from
registration under the Securities Act, and applicable state securities laws.
(d) The Purchaser is an "accredited investor" as defined under Rule
501 of Regulation D promulgated under the Securities Act.
(e) The Purchaser is and will be acquiring the Shares for such
Purchaser's own account, and not with a view to any resale or distribution of
the Shares in whole or in part, in violation of the Securities Act or any
applicable securities laws.
(f) The offer and sale of the Shares is intended to be exempt from
registration under the Securities Act, by virtue of Section 4(2) and Regulation
D promulgated under the Securities Act. The Purchaser understands that the
Shares purchased hereunder have not been, and may never be, registered under the
Securities Act and that none of the Shares can be sold, transferred, assigned,
pledged or subjected to any lien or security interest unless they are first
registered under the Securities Act and such state and other securities laws as
may be applicable or in the opinion of counsel for the Company an exemption from
registration under the Securities Act is available (and then the Shares may be
sold, transferred, assigned, pledged or subjected to a lien or security interest
only in compliance with such exemption and all applicable state and other
securities laws).
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(g) The Purchaser (i) has such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of an
investment in the Company; and (ii) recognizes that such Purchaser's investment
in the Company involves a high degree of risk.
(h) The Purchaser is capable of evaluating the risks and merits of an
investment in the Shares by virtue of its experience as an investor and its
knowledge, experience, and sophistication in financial and business matters and
such Purchaser is capable of bearing the entire loss of its investment in the
Shares.
(i) The Purchaser is neither a registered broker-dealer nor an
affiliate of a registered broker-dealer.
3. Representations, Warranties and Covenants of the Company. The Company
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represents and warrants to the Purchaser, and covenants for the benefit of the
Purchaser, as follows:
(a) The Company has been duly incorporated and is validly existing
and in good standing under the laws of the state of Delaware, with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as currently conducted, and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure to
register or qualify would not shave a Material Adverse Effect. For purposes of
this agreement, "Material Adverse Effect" shall mean any effect on the business,
results of operations, assets or financial condition of the Company that is
material and adverse to the Company and its subsidiaries, taken as a whole
and/or any condition, circumstance, or situation that would prohibit the Company
from entering into and performing any of its obligations under this Agreement in
any material respect.
(b) The Company has furnished the Purchaser with copies of the
Company's most recent Annual Report on Form 10-K for fiscal year ended June 30,
1999 (the "Form 10-K") filed with the Commission and its Form 10-Q for the
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quarterly period ended March 31, 2000 (the "Form 10-Q"; collectively with the
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Form 10-K, the "Public Documents"). The Public Documents at the time of their
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filing did not include any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements contained therein,
in light of the circumstances under which they were made, not misleading. As
used herein, "Commission Documents" means all reports, schedules, forms,
statements and other documents filed by the Company with the Commission pursuant
to the reporting requirements of the Exchange Act, including material filed
pursuant to Section 13(a) or 15(d) of the Exchange Act.
(c) The Shares have been duly authorized by all necessary corporate
action and, when paid for by the Purchaser and issued in accordance with the
terms hereof, the Shares shall be validly issued, will be fully paid and non-
assessable.
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(d) Each of this Agreement and the Registration Rights Agreement
attached hereto as Exhibit A (the "Registration Rights Agreement") has been duly
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authorized, validly executed and delivered on behalf of the Company and is a
valid and binding agreement and obligation of the Company enforceable against
the Company in accordance with its terms, subject to limitations on enforcement
by general principles of equity and by bankruptcy or other laws affecting the
enforcement of creditors' rights generally, and the Company has full power and
authority to execute and deliver this Agreement and the other agreements and
documents contemplated hereby and to perform its obligations hereunder and
thereunder.
(e) The execution and delivery of this Agreement and the Registration
Rights Agreement, the issuance of any of the Shares and the consummation of the
transactions contemplated by this Agreement and the Registration Rights
Agreement by the Company, will not (i) conflict with or result in a breach of or
a default under any of the terms or provisions of, (A) the Company's certificate
of incorporation or by-laws, or (B) of any material provision of any indenture,
mortgage, deed of trust or other material agreement or instrument to which the
Company is a party or by which it or any of its material properties or assets is
bound, (ii) result in a violation of any material provision of any law, statute,
rule, regulation, or any existing applicable decree, judgment or order by any
court, Federal or state regulatory body, administrative agency, or other
governmental body having jurisdiction over the Company, or any of its material
properties or assets or (iii) result in the creation or imposition of any
material lien, charge or encumbrance upon any material property or assets of the
Company or any of its subsidiaries pursuant to the terms of any agreement or
instrument to which any of them is a party or by which any of them may be bound
or to which any of their property or any of them is subject except in the case
of clauses (i)(B) or (iii) for any such conflicts, breaches, or defaults or any
liens, charges, or encumbrances which would not have a Material Adverse Effect.
(f) The sale and issuance of the Shares in accordance with the terms
and on the basis of the representations and warranties set forth in this
Agreement will be exempt from the registration requirements of the Securities
Act.
(g) No consent, approval or authorization of or designation,
declaration or filing with any governmental authority on the part of the Company
is required in connection with the valid execution and delivery of this
Agreement or the offer, sale or issuance of the Shares or the consummation of
any other transaction contemplated by this Agreement (other than any filings
which may be required to be made by the Company with the Securities and Exchange
Commission, or Nasdaq or pursuant to any state or "blue sky" securities laws
subsequent to the Closing, and, any registration statement which may be filed
pursuant to this Agreement).
(h) There is no action, suit, claim or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending against
or affecting the Company, or any of its properties, which questions the validity
of the Agreement, the Registration Rights Agreement or the transactions
contemplated thereby or any action taken or to be take pursuant thereto. There
is no action, suit, claim or proceeding before or by any court or governmental
agency or body, domestic or foreign, now pending against or affecting the
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Company, or any of its properties, which, if adversely determined, is reasonably
likely to result in a Material Adverse Effect.
(i) Subsequent to the dates as of which information is given in the
Public Documents, except as contemplated herein, the Company has not incurred
any material liabilities or material obligations, direct or contingent, or
entered into any material transactions not in the ordinary course of business.
(j) The Company has sufficient title and ownership of all trademarks,
service marks, trade names, copyrights, patents, trade secrets and other
proprietary rights ("Intellectual Property") necessary for its business as now
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conducted and as proposed to be conducted as described in the Public Documents
or the Commission Documents except for any of the foregoing, the absence of
which would not reasonably be likely to result in a Material Adverse Effect and,
to its knowledge without any conflict with or infringement of the rights of
others. Except as set forth in the Public Documents or the Commission Documents,
there are no material outstanding options, licenses or agreements of any kind
relating to the Intellectual Property, nor is the Company bound by or party to
any material options, licenses or agreements of any kind with respect to the
Intellectual Property of any other person or entity.
(k) The Company has complied and will comply with all applicable
federal and state securities laws in connection with the offer, issuance and
sale of the Shares hereunder. Neither the Company nor anyone acting on its
behalf, directly or indirectly, has or will sell, offer to sell or solicit
offers to buy any of the Shares, or similar securities to, or solicit offers
with respect thereto from, or enter into any preliminary conversations or
negotiations relating thereto with, any person, or has taken or will take any
action so as to bring the issuance and sale of any of the Shares under the
registration provisions of the Securities Act and any other applicable federal
and state securities laws. Neither the Company nor any of its affiliates, nor
any person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) in connection with any of the Shares.
(l) Neither this Agreement or the Schedules hereto nor the
Registration Rights Agreement contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements made
herein or therein, in the light of the circumstances under which they were made
herein or therein, not misleading.
(m) The authorized capital stock of the Company and the shares
thereof issued and outstanding as of August 28, 2000 are set forth on Schedule
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3(m) attached hereto. All of the outstanding shares of the Company's Common
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Stock have been duly and validly authorized, and are fully paid and non-
assessable. Except as set forth in this Agreement, the Public Documents the
Commission Documents or on Schedule 3(m) attached hereto, as of August 28, 2000,
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no shares of Common Stock are entitled to preemptive rights or registration
rights and there are no outstanding options, warrants, scrip, rights to
subscribe to, call or commitments of any character whatsoever relating to, or
securities or rights convertible into, any shares of capital stock of the
Company. Furthermore, except as set forth in this Agreement, in the Public
Documents, the
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Commission Documents or on Schedule 3(m) as of the date hereof, there are no
contracts, commitments, understandings, or arrangements by which the Company is
or may become bound to issue additional shares of the capital stock of the
Company or options, securities or rights convertible into shares of capital
stock of the Company. Except as disclosed in the Commission Documents and except
for customary transfer restrictions contained in agreements entered into by the
Company in order to sell restricted securities, as of the date hereof, the
Company is not a party to any agreement granting registration rights to any
person with respect to any of its equity or debt securities. The Company is not
a party to, and it has no knowledge of, any agreement restricting the voting or
transfer of any shares of the capital stock of the Company. The offer and sale
of all capital stock, convertible securities, rights, warrants, or options of
the Company issued prior to the Closing complied with all applicable federal and
state securities laws, and no stockholder has a right of rescission or damages
with respect thereto which is reasonably likely to have a Material Adverse
Effect. The Company has furnished or made available to the Purchaser true and
correct copies of the Company's Certificate of Incorporation as in effect on the
date hereof (the "Certificate"), and the Company's Bylaws as in effect on the
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date hereof (the "Bylaws").
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(n) Prior to the effectiveness of the Registration Statement (as
defined in the Registration Rights Agreement), the Company will use its best
efforts to list the Shares for trading on the Nasdaq National Market system or
any relevant market or system, if applicable, and will comply in all material
respects with the Company's reporting, filing and other obligations under the
bylaws or rules of the NASD and NASDAQ system or any relevant market or system.
(o) The Company may not issue a press release or otherwise make a
public statement or announcement with respect to the transaction contemplated
hereby prior to the Closing Date. In the event that the Company is required by
law or regulations to issue a press release or otherwise make a public statement
or announcement with respect to this Agreement after the Closing Date, the
Company shall consult with the Purchaser on the form and substance of such press
release or other disclosure.
(p) The Company may not enter into an agreement with a third party
before the effectiveness of the Registration Statement covering the Shares, the
principal purpose of which is to secure equity financing, except for (i) an
equity financing in an amount that is equal to or less than 500,000 shares at a
price per share greater than the Purchase Price and (ii) the issuance of capital
stock to a strategic investor.
4. Conditions Precedent: The obligations hereunder of both the Company
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and the Purchaser to enter into this Agreement is subject to their satisfaction
or waiver, at or before the Closing, of each of the conditions set forth below.
These conditions are for the Company's and the Purchaser's sole benefit
respectively, and they may waive their own rights at any time in their sole
discretion.
(a) The parties shall have executed and delivered this Agreement and
the Registration Rights Agreement.
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(b) The Company shall have delivered certificates evidencing the
Shares to the Purchaser.
(c) Upon receipt of the certificates evidencing the Shares, the
Purchaser shall have delivered to the Company immediately available funds as
payment in full of the Purchase Price for the Shares.
(d) The Purchaser shall have received a legal opinion in
substantially the form annexed hereto as Exhibit A.
5. Legends. Unless otherwise provided below, each certificate
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representing the Shares shall be stamped or otherwise imprinted with a legend
substantially in the following form (the "Legend"):
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"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS AND MAY
NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES
ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR MYRIAD
GENETICS INC. (THE "COMPANY") SHALL HAVE RECEIVED AN
OPINION, IN FORM, SCOPE AND SUBSTANCE REASONABLY ACCEPTABLE
TO THE COMPANY, OF COUNSEL WHO IS REASONABLY ACCEPTABLE TO
THE COMPANY THAT REGISTRATION OF SUCH SECURITIES UNDER THE
SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE
FEDERAL AND STATE SECURITIES LAWS IS NOT REQUIRED."
6. Fees and Expenses. Except as otherwise set forth in this Agreement and
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the Registration Rights Agreement, each of the Company and the Purchaser shall
pay its respective fees and expenses related to the transactions contemplated by
this Agreement and the Registration Rights Agreement; provided, that in
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connection with this Agreement, the Company shall pay, within one week of the
Closing Date, a fee to Xxxxxx Brothers in an amount mutually agreed upon by the
Company and Xxxxxx Brothers.
7. Indemnification.
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(a) The Company hereby agrees to indemnify and hold harmless the
Purchaser and its officers, directors, shareholders, employees, agents and
attorneys against any and all losses, claims, damages, liabilities and
reasonable expenses incurred by each such person in connection with defending or
investigating any such claims or liabilities, whether or not resulting in any
liability to such person, to which any such indemnified party may become
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subject, insofar as such losses, claims, demands, liabilities and expenses arise
out of or are based upon any breach of any representation or warranty made by
the Company in this Agreement.
(b) The Purchaser hereby agrees to indemnify and hold harmless the
Company and its officers, directors, shareholders, employees, agents and
attorneys against any and all losses, claims, damages, liabilities and expenses
incurred by each such person in connection with defending or investigating any
such claims or liabilities, whether or not resulting in any liability to such
person, to which any such indemnified party may become subject under the
Securities Act, or under any other statute, at common law or otherwise, insofar
as such losses, claims, demands, liabilities and expenses arise out of or are
based upon (i) any untrue statement or alleged untrue statement of a material
fact made by the Purchaser, (ii) any omission or alleged omission of a material
fact with respect to the Purchaser or (iii) any breach of any representation,
warranty or agreement made by the Purchaser in this Agreement.
8. Governing Law; Consent to Jurisdiction. This Agreement shall be
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governed by and interpreted in accordance with the laws of the State of New York
without giving effect to the rules governing the conflicts of laws. Each of the
parties consents to the exclusive jurisdiction of the Federal courts whose
districts encompass any part of the County of New York located in the City of
New York in connection with any dispute arising under this Agreement and hereby
waives, to the maximum extent permitted by law, any objection, including any
objection based on forum non conveniens, to the bringing of any such proceeding
in such jurisdictions. Each party waives its right to a trial by jury. Each
party to this Agreement irrevocably consents to the service of process in any
such proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to such party at its address set forth herein or its
agent. Nothing herein shall affect the right of any party to serve process in
any other manner permitted by law.
9. Notices. All notices and other communications provided for or
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permitted hereunder shall be made in writing by hand delivery, express overnight
courier, registered first class mail, or telecopier, initially to the address
set forth below, and thereafter at such other address, notice of which is given
in accordance with the provisions of this Section.
(a) if to the Company:
Myriad Genetics Inc.
000 Xxxxxx Xxx
Xxxx Xxxx Xxxx, Xxxx 00000
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Attn: President
with a copy to:
Xxxxx X. Xxxxxx, Esq.
Mintz Xxxxx Xxxx Xxxxxx Xxxxxxx and Xxxxx PC
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One Financial Center
Xxxxxx, Xxxxxxxxxxxxx 00000
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
(b) if to the Purchaser:
Acqua Wellington North American Equities Fund, Ltd.
c/o Fortis Fund Services (Bahamas) Ltd.
Xxxxxxxx Xxxxxxxx Centre
East Bay Street, P. O. Box SS-6238
Nassau, Bahamas
Attention: Xxxxxxx X.X. Xxxxx Xxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; when receipt is
acknowledged, if telecopied; or when actually received or refused if sent by
other means.
10. Entire Agreement. This Agreement and the Registration Rights
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Agreement constitute the entire understanding and agreement of the parties with
respect to the subject matter hereof and supersedes all prior and/or
contemporaneous oral or written proposals or agreements relating thereto all of
which are merged herein. This Agreement may not be amended or any provision
hereof waived in whole or in part, except by a written amendment signed by both
of the parties.
11. Counterparts. This Agreement may be executed by facsimile signature
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and in counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[end of page]
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IN WITNESS WHEREOF, this Agreement was duly executed on the date first
written above.
MYRIAD GENETICS INC.
By: /s/ Xxx X. Xxxxx
Name: Xxx X. Xxxxx
Title: Chief Financial Officer
Vice President Finance
ACQUA WELLINGTON NORTH AMERICAN EQUITIES FUND,
LTD.
By: /s/ Xxxxxxx X.X. Xxxxx Xxxxxx
Name: Xxxxxxx X.X. Xxxxx Xxxxxx
Title: Director
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EXHIBIT A TO THE
COMMON STOCK PURCHASE AGREEMENT
OPINION OF COUNSEL
1. The Company is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and has full power and
authority (corporate and other) to conduct its business as presently conducted
by it and to enter into and perform the Purchase Agreement and the Registration
Rights Agreement and to carryout the transactions contemplated thereby. There
are no jurisdictions in which, to our knowledge, the nature of the Company's
properties or the transaction of its business, makes the Company's qualification
to do business as a foreign corporation necessary, except for those
jurisdictions in which the Company is qualified, to our knowledge, to do
business as a foreign corporation or those jurisdictions in which failure to be
so qualified would not have a Material Adverse Effect.
2. The execution, delivery and performance by the Company of the
Purchase Agreement and the Registration Rights Agreement have been duly
authorized by all necessary corporate action of the Company, and each of the
Purchase Agreement and the Registration Rights Agreement has been duly executed
and delivered by the Company. The Purchase Agreement and the Registration Rights
Agreement each constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms.
3. The issuance, sale and delivery of the Shares in accordance with
the Purchase Agreement have been duly authorized by all necessary corporate
action on the part of the Company and, when delivered against payment in full as
provided in the Purchase Agreement, will be validly issued, fully paid and
nonassessable. To our knowledge, the Shares are free and clear of all liens,
charges, restrictions, claims and encumbrances imposed by or through the
Company. Neither the issuance, sale or delivery of the Shares is subject to any
preemptive right of stockholders of the Company arising under law or the
Certificate of Incorporation or By-laws of the Company, each as amended to date.
4. The execution and delivery of the Purchase Agreement and the
Registration Rights Agreement and the performance by the Company of its
obligations thereunder, do not (A) violate any provision of the Certificate of
Incorporation or By-laws of the Company, each as amended to date, (B) violate,
conflict with or constitute a default under any material contract, commitment,
trust or agreement of any kind known to us to which the Company is a party or by
which it is bound or (C) violate the Delaware General Corporation Law or any
U.S. federal statute, regulation or rule or, to our knowledge, any judgment,
decree, writ, order or injunction of any arbitrator, court or governmental
authority binding upon the Company.
5. To our knowledge, there is no action, suit, proceeding or
arbitration pending against or threatened against or affecting the Company
before any court or arbitrator
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or any governmental body, agency or official which, if adversely determined, is
reasonably likely to result in a Material Adverse Effect, or which in any manner
questions the validity of the Purchase Agreement and the issuance of the Shares
pursuant thereto, or the Registration Rights Agreement
6. To our knowledge, all authorizations, consents, approvals and
clearances of all governmental agencies and authorities and of third parties
required in order to permit the issuance by the Company of the Shares pursuant
to the Purchase Agreement (other than any filings which may be required to be
made by the Company with the Commission, or Nasdaq subsequent to the Closing,
and, any registration statement which may be filed pursuant to the Purchase
Agreement or the Registration Rights Agreement) have been obtained.
7. Subject to the truth and accuracy of the representations and
warranties of the Purchaser set forth in Section 2 of the Purchase Agreement,
the offer, issuance and sale of the Shares pursuant to the Purchase Agreement
will be exempt from registration under the Securities Act of 1933, as amended,
pursuant to Rule 4(2) and Regulation D promulgated thereunder.
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