SUBSCRIPTION AGREEMENT
THE
SECURITIES SUBSCRIBED FOR BY THIS AGREEMENT HAVE NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE
IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL
TO
THE SUBSCRIBER TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY.
This
SUBSCRIPTION AGREEMENT (the "Agreement")
is
made by and between the subscriber hereto (the “Subscriber”)
and
Calypte
Biomedical Corporation,
a
Delaware
corporation
(the "Company”).
The
Subscriber hereby agrees to purchase, and the Company hereby agrees to issue
and
to sell to the Subscriber, the number of shares (the “Shares”)
of
common stock of the Company, par value $.03 per share (the "Common
Stock")
set
forth on the signature page, for a purchase price in cash equal to $0.052 per
share (the aggregate amount to be paid by the Subscriber shall be referred
to as
the "Purchase
Price")
and
warrants (the “Warrants”)
to
purchase an additional one hundred fifty percent (150%) of the number of Shares
purchased (the “Warrant Shares”)
under
the terms set forth in the Warrants attached hereto as
Exhibit A
and
Exhibit
B.
The
Shares and Warrant Shares are collectively hereinafter referred to as the
“Securities.”
After
acceptance of this agreement (the “Agreement”)
by the
Company and payment and delivery by the Subscriber to the Company of the
Purchase Price in the form of wire transfer pursuant to the terms of Section
8(b) of this Agreement, the Company shall issue and deliver to the Subscriber
the Securities.
NOW,
THEREFORE, in order to implement the foregoing and in consideration of the
mutual representations, warranties, covenants and agreements contained herein
and for other good and valuable consideration, the receipt and adequacy of
which
are hereby acknowledged, the parties hereto agree as follows.
1. Subscriber's
Representations and Warranties.
The
Subscriber hereby represents and warrants to and agrees with the Company
that:
(a) Information
on Company.
The
Subscriber has been furnished with the Company's Form 10-KSB for the year ended
December 31, 2005 as filed with the Securities and Exchange Commission (the
“Commission”)
together with all subsequently filed Forms 10-QSB, 8-K, Proxy Statement, and
other publicly available filings made with the Commission (hereinafter referred
to collectively as the "Reports").
In
addition, the Subscriber has received from the Company such other information
concerning its operations, financial condition and other matters as the
Subscriber has requested (such information in writing is collectively, the
"Other
Written Information"),
and
considered all factors the Subscriber deems material in deciding on the
advisability of purchasing the Securities.
1
(b) Information
on Subscriber.
The
Subscriber is and was not a “U.S. person,” as defined in Regulation S of the
Securities Act of 1933, as amended (the “1933
Act”),
at
the time the offer or sale of the Securities is made. Additionally, the
Subscriber is an "accredited investor," as such term is defined in Regulation
D
of the 1933 Act or is part of a group of companies that is experienced in
investments and business matters, has made investments of a speculative nature
and has purchased securities of United States publicly-owned companies in
private placements in the past and, with its representatives, has such knowledge
and experience in financial, tax and other business matters as to enable the
Subscriber to utilize the information made available by the Company to evaluate
the merits and risks of and to make an informed investment decision with respect
to the proposed purchase, which represents a speculative investment. The
Subscriber is a natural person or an entity duly organized, validly existing
and
in good standing under the laws of the jurisdiction of its organization with
the
requisite corporate or partnership power and authority to enter into and to
consummate the transactions contemplated by this Agreement and otherwise to
carry out its obligations hereunder. The execution, delivery and performance
by
the Subscriber of the transactions contemplated by this Agreement has been
duly
authorized by all necessary corporate or, if the Subscriber is not a
corporation, such partnership, limited liability company or other applicable
like action, on the part of the Subscriber. This Agreement has been duly
executed by the Subscriber and when delivered by the Subscriber in accordance
with terms hereof, will constitute the valid and legally binding obligation
of
the Subscriber, enforceable against it in accordance with its terms, except
as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of, creditors’ rights and remedies or by
other equitable principles of general application. The Subscriber is able to
bear the risk of such investment for an indefinite period and to afford a
complete loss thereof. The information set forth on the signature page hereto
regarding the Subscriber is accurate.
(c) Purchase
of Securities and Investment Intent.
On the
Closing Date, the Subscriber will purchase the Securities for its own account
for the Purchase Price. The Subscriber is acquiring the Securities as principal
for its own account for investment purposes only and not with a view to or
for
distributing or reselling such Securities or any part thereof, without
prejudice, however, to the Subscriber’s right at all times to sell or otherwise
dispose of all or any part of such Securities in compliance with applicable
federal and state securities laws. Subject to the immediately preceding
sentence, nothing contained herein shall be deemed a representation or warranty
by such Investor to hold the Securities for any period of time. Such Investor
is
acquiring the Securities hereunder in the ordinary course of its business.
Such
Investor does not have any agreement or understanding, directly or indirectly,
with any person to distribute any of the Securities. The Subscriber also
represents that its purchase of the Securities is intended to be made as an
“Offshore
Transaction”
as
defined in Regulation S.
(d) Compliance
with Securities Act.
The
Subscriber understands and agrees that the Securities have not been registered
under the 1933 Act, by reason of their issuance in a transaction that does
not
require registration under the 1933 Act (based in part on the accuracy of the
representations and warranties of the Subscriber contained herein), and that
such Securities must be held unless a subsequent disposition is registered
under
the 1933 Act or is exempt from such registration.
2
(e) Legend
on Securities.
The
Securities shall bear the following legend, unless the Securities shall have
been included in an effective registration statement under the 1933
Act:
"THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THESE SHARES MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO CALYPTE BIOMEDICAL CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.”
(f) Communication
of Offer.
The
offer to sell the Securities was directly communicated to the Subscriber. At
no
time was the Subscriber presented with or solicited by any leaflet, newspaper
or
magazine article, radio or television advertisement, or any other form of
general advertising or solicited or invited to attend a promotional meeting
otherwise than in connection and concurrently with such communicated
offer.
(g)
Certain Trading Activities.
The
Subscriber has not directly or indirectly, nor has any person acting on behalf
of or pursuant to any understanding with the Subscriber, engaged in any trading
in any securities of the Company (including, without limitations, any Short
Sales (defined below) involving the Company’s securities) during the 20 trading
days immediately preceding the Closing. For purposes of this Section,
"Short
Sales"
include,
without limitation, all “short sales” as defined in Rule 3b-3 of the Securities
Exchange Act of 1934, as amended (the “1934
Act”)
and
include all types of direct and indirect stock pledges, forward sale contracts,
options, puts, calls, short sales, swaps and similar arrangements (including
on
a total return basis), and sales and other transactions through non-U.S. broker
dealers or foreign regulated brokers having the effect of hedging the securities
or investment made under this Agreement. As of the date of this Agreement,
the
Subscriber has no open short position in the Common Stock, and covenants that
neither it nor any person acting on its behalf or pursuant to any understanding
with it will engage in any Short Sales prior to the public disclosure of the
material terms of this transaction by the Company.
(h) Correctness
of Representations.
The
Subscriber represents that the foregoing representations and warranties are
true
and correct as of the date hereof and, unless the Subscriber otherwise notifies
the Company prior to the Closing Date, shall be true and correct as of the
Closing Date. The foregoing representations and warranties shall survive the
Closing Date.
2. Company
Representations and Warranties.
The
Company represents and warrants to and agrees with the Subscriber
that:
(a) Due
Incorporation.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has the requisite corporate power
to
own its properties and to carry on its business as now being conducted. The
Company is duly qualified as a foreign corporation to do business and is in
good
standing in each jurisdiction where the nature of the business conducted or
property owned by it makes such qualification necessary, other than those
jurisdictions in which the failure to so qualify would not have a material
adverse effect on the business, operations or financial condition of the
Company.
3
(b) Outstanding
Stock.
All
issued and outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and
non-assessable.
(c) Authority;
Enforceability.
This
Agreement has been duly authorized, executed and delivered by the Company and
is
valid and binding agreement enforceable in accordance with its terms, subject
to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
generally and to general principles of equity; and the Company has full
corporate power and authority necessary to enter into this Agreement and to
perform its obligations hereunder.
(d) Shares
Duly Authorized.
The
Shares and Warrant Shares when issued and delivered in accordance with the
terms
of this Agreement, will be duly authorized, validly issued, fully paid and
non-assessable.
(e) Stop
Transfer.
The
Securities are restricted securities as of the date of this Agreement. The
Company will not issue any stop transfer order or other order impeding the
sale,
resale or delivery of the Stock, except as may be required by federal securities
laws.
(f) No
General Solicitation.
Neither
the Company, nor any of its affiliates, nor to its knowledge, any person acting
on its or their behalf, has engaged in any form of general solicitation or
general advertising (within the meaning of Regulation S or D under the Act)
in
connection with the offer or sale of the Securities.
3. Regulation
S Offering.
This
Offering is being made pursuant to the exemption from the registration
provisions of the 1933 Act afforded by Regulation S thereunder.
4. Reissuance
of Shares.
The
Company agrees to issue and deliver to the Subscriber, at the Company’s expense,
replacement certificates for the Shares and Warrant Shares previously issued
that are free of the legend set forth in Section 1(e) above at such time as
(a)
the holder thereof is permitted to and disposes of such Shares and Warrant
Shares pursuant to Rule 144(d) and/or Rule 144(k) of the 1933 Act in the opinion
of counsel reasonably satisfactory to the Company, or (b) upon resale of the
Shares and Warrant Shares pursuant to an effective registration statement under
the 1933 Act. The Company agrees to cooperate with the Subscriber in connection
with all resales pursuant to Rule 144(d) and Rule 144(k) of the 1933 Act and
provide legal opinions necessary to allow such resales provided the Company
and
its counsel receive requested written representations from the Subscriber and
selling broker, if any.
5. Registration
Rights.
(a) The
Company agrees that it will register the Shares and Warrant Shares for resale
on
Form SB-2 or other similar form that it files with the Securities and Exchange
Commission under the Securities Act. The Company will use its best efforts
(1)
to file such registration statement no later than
45
days
after the Closing Date and (2) to achieve its effectiveness within 120
days
after the Closing Date. The Company will pay all expenses incident to the
registration of the Shares and Warrant Shares hereunder and the Company’s
performance of or compliance with this Agreement.
4
(b) The
Seller will furnish to the Company in writing such information and
representation letters with respect to itself and the proposed distribution
by
it as reasonably shall be necessary in order to assure compliance with federal
and state securities laws.
6. Certain
Adjustments of Additional Shares.
If,
prior to the first year anniversary of the Closing Date, the Company issues
any
shares of Common Stock or any Common Stock Equivalents (as defined below)
entitling any person to acquire shares of Common Stock at a price per share
less
than the Purchase Price (if the holder of the Common Stock or Common Stock
Equivalent so issued shall at any time, whether by operation of purchase price
adjustments, reset provisions, floating conversion, exercise or exchange prices
or otherwise, or due to warrants, options or rights issued in connection with
such issuance, be entitled to receive shares of Common Stock at a price less
than the Purchase Price, such issuance shall be deemed to have occurred for
less
than the Purchase Price), then, in connection with each such issuance of Common
Stock or Common Stock Equivalents for a purchase price that is less than the
Purchase Price, the Company shall immediately issue additional shares of Common
Stock (the “Additional
Shares”)
to the
Subscriber for no additional consideration. The number of Additional Shares
issuable to the Subscriber will equal: (a) the Purchase Price minus the lowest
price per share of the Common Stock or Common Stock Equivalents offered or
sold
that trigger an obligation under this Section divided by (b) the Purchase Price,
multiplied by (c) the number of Shares then held by the Subscriber. The
Additional Shares shall not be entitled to registration rights. Notwithstanding
the foregoing, no issuances of Additional Shares will be made under this Section
as a result of: (i) the issuance of Warrant Shares, (ii) the issuance of
securities upon the exercise or conversion of any Common Stock or Common Stock
Equivalents issued by the Company prior to the date hereof or any amendments,
modifications or reissuances thereof, (iii) the grant of options or warrants,
or
the issuance of additional securities, under any duly authorized Company stock
option, restricted stock plan or stock purchase plan whether now existing or
approved by the Company and its stockholders in the future, (iv) shares of
Common Stock (including any shares of Common Stock issuable in respect of Common
Stock Equivalents) issued or issuable as part of an equity line with Dutchess
Capital Management, not to exceed $10 million (v) shares
of
Common Stock or Common Stock Equivalents issued in connection with Strategic
Transactions, (vi) the
grant
of options and warrants to consultants for bona fide consulting services as
approved by the Company’s Board of Directors, or (vii) shares
of
Common Stock issued pursuant to Rule 144 at a price equal to or greater than
80%
of the Purchase Price.
For
purposes of this Agreement “Common Stock Equivalents” shall mean any securities
of the Company which entitle the holder thereof to acquire Common Stock at
any
time, including without limitation, any debt, preferred stock, rights, options,
warrants or other instrument that is at any time convertible into or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock or other securities that entitle the holder to receive, directly or
indirectly, Common Stock.
7. Fees
and Expenses.
Each
party shall pay the fees and expenses of its advisers, counsel, accountants
and
other experts, if any, and all other expenses incurred by such party incident
to
the negotiation, preparation, execution, delivery and performance of this
Agreement. The Company shall pay all stamp and other taxes and duties levied
in
connection with the issuance of the Securities.
5
8. Miscellaneous.
(a) Notices.
All
notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise
specified herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice. Any notice or other communication required or permitted
to be
given hereunder shall be deemed effective (a) upon hand delivery or delivery
by
facsimile, with accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on a business
day during normal business hours where such notice is to be received), or the
first business day following such delivery (if delivered other than on a
business day during normal business hours where such notice is to be received)
or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual
receipt of such mailing, whichever shall first occur. The addresses for such
communications shall be: (i) if to the Company to Calypte Biomedical
Corporation, 0 Xxxxxxxxxxxx Xxxxx, Xxxxx 000, Xxxx Xxxxxx, Xxxxxx 00000,
facsimile number: (000) 000-0000, and
(ii)
if to the Subscriber, to the name, address and facsimile number set forth on
the
signature page hereto.
(b) Closing.
The
closing of the transactions contemplated by this Agreement (the “Closing”)
shall
take place on or before March 28, 2007 at 5:00 p.m. (Pacific Standard Time)
or
such other location and time as may be determined by the Company at the offices
of Xxxxx Winner Xxxxxxx, Esq., 00000 Xxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx, 00000.
At
the Closing, the Subscriber shall deliver to the Company the Purchase Price
in
United States dollars and in immediately available funds, by wire transfer
to
the following account:
|
Pay
to:
|
FC
- Silicon Valley Bank
|
|
0000
Xxxxxx Xxxxx
|
|
|
Xxxxx
Xxxxx, XX 00000, XXX
|
|
|
Routing
& Transit #:
|
\\FW:000000000
|
|
Swift
Code:
|
XXXXXX0X
|
|
For
Credit of:
|
Calypte
Biomedical Corporation
|
|
Final
Credit Account #:
|
FNC
- 3300349200
|
(c) Entire
Agreement; Assignment.
This
Agreement represents the entire agreement between the parties hereto with
respect to the subject matter hereof and may be amended only by a writing
executed by both parties. No right or obligation of either party shall be
assigned by that party without the written consent of the other party.
(d) Execution.
This
Agreement may be executed in separate counterparts, each of which shall be
deemed an original and both of which shall constitute one and the same document.
This Agreement may be executed by facsimile transmission.
(e) Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Oregon without regard to principles of conflicts of laws. Any action
brought by either party against the other concerning the transactions
contemplated by this Agreement shall be brought only in the state courts of
Oregon or in the federal courts located in the state of Oregon. Both parties
and
the individuals executing this Agreement agree to submit to the jurisdiction
of
such courts and waive trial by jury. The prevailing party shall be entitled
to
recover from the other party its reasonable attorney's fees and costs. In the
event that any provision of this Agreement or any other agreement delivered
in
connection herewith is invalid or unenforceable under any applicable statute
or
rule of law, then such provision shall be deemed inoperative to the extent
that
it may conflict therewith and shall be deemed modified to conform with such
statute or rule of law. Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability
of
any other provision of any agreement.
6
(f) Specific
Enforcement, Consent to Jurisdiction.
The
Company and the Subscriber acknowledge and agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent or cure breaches of the provisions of this Agreement
and
to enforce specifically the terms and provisions hereof or thereof, this being
in addition to any other remedy to which any of them may be entitled by law
or
equity. Subject to Section 7(e) hereof, each of the Company and the Subscriber
hereby waives, and agrees not to assert in any such suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of such court,
that the suit, action or proceeding is brought in an inconvenient forum or
that
the venue of the suit, action or proceeding is improper. Nothing in this Section
shall affect or limit any right to serve process in any other manner permitted
by law.
7
IN
WITNESS WHEREOF,
the
parties have hereby executed this Agreement as of the day set forth in the
acceptance set forth below.
| SUBSCRIBER NAME: | |||
|
Number
of Shares which Subscriber
Desires
to Purchase
|
|
||
|
Dollar
Amount of Subscription
Tendered
by Subscriber
|
By: |
||
|
(Street
Address)
|
|||
|
(City
and State)
|
(Zip
Code)
|
||
|
Telephone
Number
|
ACCEPTANCE
The
foregoing subscription is hereby accepted, subject to the terms and conditions
hereof, as of March_____, 2007.
|
CALYPTE
BIOMEDICAL CORPORATION
|
||
|
Amount
of Subscription Accepted
|
||
|
By:
|
||
|
Number
of Securities
|
Name:
Xxxxxxx Xxxxxxxxxx
|
|
|
Title:
Executive Vice President
|
8
