FORM OF PURCHASE AGREEMENT
Exhibit
10.1
FORM
OF PURCHASE AGREEMENT
THIS
PURCHASE AGREEMENT
(this
“Agreement”)
is
entered into as of February 14, 2008 (the “Effective
Date”),
by
and among New York Mortgage Trust, Inc., a Maryland corporation (the
“Company”),
and
the purchasers listed on the Schedule of Purchasers attached hereto as
Schedule
A
(each, a
“Purchaser”
and,
collectively, the “Purchasers”).
THE
PARTIES TO THIS AGREEMENT
enter
into this Agreement on the basis of the following facts, intentions and
understandings:
A. In
accordance with the terms and conditions of this Agreement, the Company has
agreed to issue and sell, and the Purchasers have agreed to purchase, in a
transaction that is exempt from registration under Section 4(2) of the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder (the “Securities
Act”),
that
number of shares of common stock, par value $0.01 per share, of the Company
(the
“Common
Stock”)
set
forth opposite their respective names on the Schedule of Purchasers attached
hereto as Schedule
A
and, in
the aggregate, up to 15,000,000 shares of Common Stock (the “Shares”).
JMP
Securities LLC has acted as placement agent (the “Placement
Agent”)
with
respect to the sale of the Shares.
B. Contemporaneously
with the execution and delivery of this Agreement, the parties hereto are
executing and delivering a Registration Rights Agreement substantially in the
form attached hereto as Exhibit
A
(the
“Registration
Rights Agreement”
and,
together with this Agreement, the “Operative
Agreements”),
pursuant to which the Company has agreed to provide the Purchasers with the
benefit of certain registration rights under the Securities Act, subject to
the
Closing (as defined in Section
1.2
below),
on the terms and subject to the conditions set forth therein.
NOW,
THEREFORE,
in
consideration of the promises and the mutual covenants contained herein, and
for
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, the Company and each of the Purchasers hereby agree as
follows:
SECTION
1. Sale
and Purchase of the Shares.
1.1 Purchase
and Sale of the Shares.
At the
Closing the Company shall issue and sell to each Purchaser, and each Purchaser
agrees to purchase from the Company, severally and not jointly, upon the terms
and subject to the conditions hereinafter set forth, the number of Shares set
forth opposite the Purchaser’s name on the Schedule of Purchasers attached
hereto as Schedule
A
at a
purchase price of Four Dollars ($4.00) per share.
1.2 The
Closing.
The
completion of the purchase and sale of the Shares (the “Closing”)
shall
occur at the offices of O’Melveny & Xxxxx LLP, 000 Xxxxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, as soon as practicable on the date agreed
upon by the Company and the Placement Agent, but in no event later than three
(3) business days following the execution of this Agreement, or on such later
date or at such different location as the Company and the Placement Agent shall
agree upon in writing, but in any event not prior to the date that the
conditions for Closing set forth in Sections
5
and
6
of this
Agreement shall have been satisfied or waived by the appropriate party (the
“Closing
Date”).
The
Closing shall occur at a time to be agreed upon by the Company and the Placement
Agent and of which the Purchasers shall be notified by facsimile transmission
or
otherwise.
1.3 Form
of Payment; Delivery of the Shares.
At
the
Closing, (i) each Purchaser shall pay the Company the amount opposite such
Purchaser’s name on the Schedule of Purchasers attached hereto as Schedule
A
for the
Shares to be issued and sold to such Purchaser, by wire transfer of immediately
available funds in accordance with the Company’s written wire instructions
attached hereto on Schedule
B,
and
(ii) the Company shall deliver to each Purchaser one or more stock certificates
registered in the name of the Purchaser, or in such nominee name(s) as
designated by the Purchaser in writing at least two (2) days before Closing,
representing in the aggregate the number of Shares set forth opposite such
Purchaser’s name on the Schedule of Purchasers attached hereto as Schedule
A
and
bearing the legends referred to in Section
3.9
of this
Agreement. The name(s) in which the stock certificates are to be registered
are
set forth in the Stock Certificate Questionnaire attached hereto as part of
Appendix
I.
Each
party’s obligations to complete the purchase and sale of the Shares at the
Closing shall be subject to the satisfaction (or waiver) of the conditions
set
forth in Sections
5
and
6
of this
Agreement.
1.4 Independent
Nature of Purchasers’ Obligations and Rights.
The
rights and obligations of each Purchaser under any Operative Agreement are
several and not joint with the rights and obligations of the other Purchasers.
A
Purchaser shall not be responsible in any way for the performance of the
obligations of any other Purchasers under any Operative Agreement. Except as
otherwise set forth in Section
6
of this
Agreement, a Purchaser shall not have the right to terminate or fail to perform
its obligations under any Operative Agreement solely because another Purchaser
terminates or fails to perform its obligations under an Operative Agreement.
Nothing contained herein or in any Operative Agreement, and no action taken
by
any Purchaser pursuant thereto shall constitute the Purchasers as a partnership,
an association, a joint venture or any other kind of entity, or create a
presumption that the Purchasers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the
Operative Agreements. Each Purchaser shall be entitled to independently protect
and enforce its rights, including, without limitation, the rights arising out
of
this Agreement or out of the other Operative Agreements, and it shall not be
necessary for the other Purchasers to be joined as additional parties in any
proceeding for such purpose.
SECTION
2. Company’s
Representations and Warranties.
The
Company represents and warrants to, and covenants with, each Purchaser as
follows as of the Effective Date and the Closing Date:
2.1 Confidential
Private Placement Memorandum.
The
Company has prepared the confidential private placement memorandum dated
February 14, 2008 (the “Private
Placement Memorandum”),
setting forth information concerning the Company and the Common Stock. As used
in this Agreement, “Private Placement Memorandum” means the Private Placement
Memorandum as amended or supplemented and including all documents incorporated
by reference therein, including any SEC Filings (as defined below). To the
knowledge of the Company, copies of the Private Placement Memorandum and the
documents listed in clauses (a) through (d) below have been delivered to the
Purchasers pursuant to the terms of this Agreement. The Private Placement
Memorandum (excluding the draft form of this Agreement and the draft form of
the
Registration Rights Agreement), as of its date, and each of the following
documents, as of the respective date it was filed with the Commission (as
defined below) (together with any information included in the Current Report
on
Form 8-K of the Company furnished, but not filed with, the Commission on
January 25, 2008 that is not expressly incorporated by reference in the
Private Placement Memorandum), do not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
in
which they were made, not misleading:
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(a) the
Company’s Annual Report on Form 10-K for the year ended December 31, 2006
(including certain information incorporated by reference therein from the
Company’s definitive Proxy Statement on Schedule 14A for the Company’s 2007
Annual Meeting of Stockholders) (the “2006
10-K”);
(b) the
Company’s Quarterly Reports on Forms 10-Q for its fiscal quarters ended March
31, 2007, June 30, 2007 and September 30, 2007 (collectively, the “2007
10-Q”);
(c) the
Company’s Current Reports on Forms 8-K filed with the Commission on February 14,
2007, March 14, 2007, July 3, 2007 (with respect to Item 8.01 only), September
6, 2007, September 12, 2007, October 1, 2007, October 4, 2007, December 3,
2007
(with respect to our filing under Items 1.01 and 5.02 on Form 8-K) and January
25, 2008 (with respect to our filing under Items 1.01, 3.02, 5.02, 5.03, 7.01
and 9.01 of Form 8-K) (collectively, the “8-K”);
(d) all
other
documents, if any, filed by the Company with the Commission since December
31,
2006 and prior to the Closing Date (together with the 2006 10-K, 2007 10-Q
and
8-K, the “SEC
Filings”)
pursuant to the reporting requirements of the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder (the
“Exchange
Act”).
The
Private Placement Memorandum does not contain any information that, immediately
after the Company files the Current Report on Form 8-K in accordance with
Section
4.2
of this
Agreement, would constitute material non-public information.
2.2 Exchange
Act Filings.
The
Company’s Common Stock is registered pursuant to Section 12(g) of the Exchange
Act and the Company is subject to the reporting requirements of the Exchange
Act
and has filed in the time and manner required all documents that the Company
was
required to file under the Exchange Act. The Company has not received
notification that the Commission is contemplating terminating registration.
The
SEC Filings, when they were filed with the Securities and Exchange Commission
(the “Commission”),
conformed in all material respects to the applicable requirements of the
Exchange Act and the rules and regulation of the Commission promulgated
thereunder applicable to the SEC Filings. The Company covenants that its Annual
Report on Form 10-K for the year ended December 31, 2007 will be timely filed
on
or before March 17, 2008.
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2.3 Financial
Statements.
The
financial statements, including the notes thereto, included in the SEC Filings
present fairly and accurately in all material respects the consolidated
financial position of the Company as of the dates indicated and the consolidated
results of operations and changes in financial position and cash flows of the
Company for the periods specified; such financial statements have been prepared
in conformity with generally accepted accounting principles (“GAAP”)
as
applied in the United States and on a consistent basis throughout the periods
involved and in accordance with Regulation S-X promulgated by the Commission;
the financial statement schedules included in the SEC Filings and the amounts
under Part II, Item 6 of the 2006 10-K present the information shown therein
fairly and accurately in all material respects and have been compiled on a
basis
consistent with the financial statements included in the SEC
Filings.
2.4 Organization
and Qualification.
Each of
the Company and its Subsidiaries (as defined below),
other
than New York Mortgage Trust 2006-1 (which is a validly existing common law
trust fund formed pursuant to applicable law, validly existing and in compliance
with all applicable contractual and legal requirements),
has been
duly incorporated or formed and is validly existing as a corporation, limited
liability company or trust, as applicable, in good standing under the laws
of
the jurisdiction of its incorporation or formation, as applicable, with full
power and authority to own its properties and conduct its business as presently
conducted and described in the Private Placement Memorandum. Each of the Company
and each Subsidiary, other than New York Mortgage Trust 2006-1, is duly
qualified to do business and is in good standing in each jurisdiction in which
the ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to so qualify would not,
individually or in the aggregate, reasonably be expected to have a material
adverse effect on (i) the business, prospects, properties, assets, condition
(financial or otherwise) or results of operations of the Company and its
Subsidiaries taken as a whole, (ii) the transactions contemplated hereby or
in
the other Operative Agreements or (iii) the authority or the ability of the
Company to perform its obligations under the Operative Agreements (a
“Material
Adverse Effect”).
Complete and correct copies of the Articles of Amendment and Restatement of
the
Company as amended (the “Charter”)
and
bylaws of the Company as in effect on the Effective Date have been filed by
the
Company with the Commission.
2.5 Subsidiaries
of the Company.
The
Company does not own or control, directly or indirectly, any Subsidiary other
than the “Subsidiaries”
listed
on Schedule
C
hereto.
For the purposes of this Agreement, the term “Subsidiary”
shall
mean any: (a) firm, corporation, partnership, limited liability company,
trust or other entity (a “Person”)
of
which the Company owns (i) at least 10% of the outstanding voting capital
stock (or other outstanding voting shares of beneficial interest), or
(ii) at least a majority of the partnership, membership, joint venture or
similar interests; (b) partnership in which the Company is a general
partner; or (c) limited liability company in which the Company is the manager
or
the managing member. Except as disclosed in the SEC Filings, the Company owns,
directly or indirectly, all of the capital stock or other equity interests
of
each Subsidiary free and clear of any liens. Except for short-term investments,
the Company does not own any shares of stock or any other equity or long-term
debt securities of any corporation or have any equity interest in any firm,
partnership, limited liability company, joint venture, association or other
entity except as set forth in the SEC Filings or the Private Placement
Memorandum.
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2.6 Authorized
Capital Stock.
The
authorized capital stock of the Company consists of 400,000,000 shares of Common
Stock and 200,000,000 shares of Preferred Stock (“Preferred
Stock”),
including 2,000,000 shares of Series A Cumulative Redeemable Convertible
Preferred Stock, par value $0.01 per share (“Series
A Preferred Stock”).
As of
the Effective Date, 3,640,209 shares of Common Stock were issued and outstanding
and 1,000,000 shares of Series A Preferred Stock were issued and outstanding;
the issued and outstanding shares of Series A Preferred Stock and Common Stock
have been duly and validly authorized and issued, are fully paid and
nonassessable, have been issued in compliance with all federal and state
securities laws and were not issued in violation of or subject to any preemptive
rights or other rights to subscribe for or purchase securities, and conform
in
all material respects to the description thereof contained in the Private
Placement Memorandum. Except as disclosed in the SEC Filings or in the Private
Placement Memorandum and, except for options issued pursuant to the Company’s
2005 Stock Incentive Plan and 2004 Stock Incentive Plan, the Company does not
have outstanding any options to purchase, or any preemptive rights or other
rights to subscribe for or to purchase, any securities or obligations
convertible into, or any contracts or commitments to issue or sell, shares
of
its capital stock or any such options, rights, convertible securities or
obligations, or any obligation to repurchase, redeem or otherwise acquire any
outstanding security of the Company. Except as set forth in the Charter, the
issue and sale of the Shares will not obligate the Company to issue shares
of
Common Stock or other securities to any person and will not result in a right
of
any holder of Company securities to adjust the exercise, conversion, exchange
or
reset price under such securities. The description of the Company’s stock, stock
bonus and other stock plans or arrangements and the options or other rights
granted and exercised thereunder set forth in the Private Placement Memorandum
accurately and fairly presents all material information with respect to such
plans, arrangements, options and rights. With respect to each Subsidiary, (i)
all the issued and outstanding shares, if any, of each Subsidiary’s capital
stock have been duly and validly authorized and issued, are fully paid and
nonassessable, have been issued in compliance with all federal and state
securities laws and were not issued in violation of or subject to any preemptive
rights or other rights to subscribe for or purchase securities, and (ii) there
are no outstanding options to purchase, or any preemptive rights or other rights
to subscribe for or to purchase, any securities or obligations convertible
into,
or any contracts or commitments to issue or sell, any of the Subsidiary’s
capital stock or any such options, rights, convertible securities or
obligations, or any obligation to repurchase, redeem or otherwise acquire any
outstanding security of such Subsidiary. Except as disclosed in the SEC Filings
or the Private Placement Memorandum, there are no stockholder agreements, voting
agreements or similar agreements or arrangements with respect to the Common
Stock or Preferred Stock to which the Company is a party, or, to the knowledge
of the Company, between or among any of the Company’s stockholders.
2.7 Issuance,
Sale and Delivery of the Shares.
The
Shares have been duly and validly authorized by the Company and, when issued,
delivered and paid for in the manner set forth in this Agreement, shall be
duly
authorized, validly issued, fully paid and nonassessable and free and clear
of
all pledges, liens, restrictions, mortgages, claims and encumbrances (other
than
restrictions on transfer under state and/or federal securities laws and under
the Charter), and will conform in all material respects to the description
thereof set forth in the Private Placement Memorandum. The form of certificate
used to evidence the Common Stock complies in all material respects with all
applicable statutory requirements and any applicable requirements of the
organizational documents of the Company. No preemptive rights or other rights
to
subscribe for or purchase the Company’s capital stock exist by operation of law,
under the organizational documents of the Company or under any agreement to
which the Company or its Subsidiaries is a party or otherwise with respect
to
the issuance and sale of the Shares by the Company pursuant to this Agreement.
No stockholder of the Company has any right (which has not been waived or has
not expired by reason of lapse of time following notification of the Company’s
intent to file the registration statement to be filed by the Company pursuant
to
the Registration Rights Agreement (the “Registration
Statement”))
to
require the Company to register the sale of any shares or other securities
owned
by such security holder under the Securities Act in the Registration Statement.
No further approval or authority of the stockholders or the Board of Directors
of the Company is required for the issuance and sale of the Shares by the
Company, or the filing of the Registration Statement by the Company, as
contemplated herein.
5
2.8 Due
Execution, Delivery and Performance.
The
Company has the corporate power and authority to enter into the Operative
Agreements and to perform the transactions contemplated hereby and thereby.
Each
of the Operative Agreements has been duly authorized, executed and delivered
by
the Company, and assuming the valid execution thereof by each Purchaser, the
Operative Agreements shall constitute valid and binding obligations of the
Company, enforceable in accordance with their terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors’ rights generally and except as
enforceability may be subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law)
and except as agreements by the Company to indemnify others may be violative
of
public policy and, thus, unenforceable.
2.9 No
Conflicts.
The
execution, delivery and performance of the Operative Agreements, the issuance
and sale of the Shares to be purchased by the Purchasers under this Agreement
and the consummation of the other transactions contemplated by the Operative
Agreements do not and will not (i) conflict with or constitute a violation
of,
or default (with the passage of time or the delivery of notice) under, (A)
any
bond, debenture, note or other evidence of indebtedness, or any agreement,
lease, franchise, license, permit, contract, indenture, mortgage, deed of trust,
loan agreement, joint venture or other agreement or instrument to which the
Company or any of its Subsidiaries is a party or by which it or any of its
Subsidiaries or their property is bound, where such conflict, violation or
default might reasonably be expected to have a Material Adverse Effect, or
(B) any law, administrative regulation, ordinance or judgment, order or
decree of any court or governmental agency, arbitration panel or authority
binding upon the Company or any of its Subsidiaries or any of their property,
where such conflict, violation or default would reasonably be expected to have
a
Material Adverse Effect, (ii) violate the Charter or bylaws of the Company
or the organizational documents of any of its Subsidiaries, or (iii) result
in the creation or imposition of any lien, encumbrance, claim, security interest
or charge upon any property or asset of the Company or any of its Subsidiaries.
2.10
No
Government Approvals.
No
authorization, approval, consent or order of or registration or filing with
any
governmental or regulatory authority, commission, board, body or agency is
required for the execution, delivery and performance of the Operative Agreements
or the consummation of the transactions contemplated in the Operative Agreements
or the issuance, sale and deliver of the Shares, except (i) as may be
required under the Securities Act in connection with the registration of the
Shares pursuant to the Registration Rights Agreement, (ii) the filing of a
Current Report on Form 8-K pursuant to Section
4.2
of this
Agreement, (iii) as may be required after the Closing under the state
securities or blue sky laws of any jurisdiction in connection with the purchase
and distribution of the Shares, (iv) as may be required in connection with
the
approval of any listing application(s) for the Shares on the NASDAQ Stock
Market, and (v) for any such other approvals as have been obtained.
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2.11
No
Material Change.
Subsequent to the respective dates as of which information is given in the
SEC
Filings, (i) neither the Company nor any of its Subsidiaries has incurred any
liabilities or obligations (whether direct or indirect or contingent or
otherwise), or entered into any oral or written agreement or other transaction
which might reasonably be expected to result in a Material Adverse Effect,
(ii)
neither the Company nor any of its Subsidiaries has sustained any material
loss
or interference with their businesses or properties from fire, flood, windstorm,
accident or other calamity (whether or not insured), (iii) neither the Company
nor any of its Subsidiaries has paid or declared any dividends or other
distributions with respect to their capital stock and neither the Company nor
any of its Subsidiaries is in default in the payment of principal or interest
on
any outstanding debt obligations, (iv) there has not been (A) any change in
the
capital stock of the Company or any of its Subsidiaries other than (1) the
sale
of the Shares hereunder, and (2) shares or options issued pursuant to the
Company’s 2005 Stock Incentive Plan and 2004 Stock Incentive Plan, or (B) any
increase in indebtedness material to the Company or any of its Subsidiaries
(other than in the ordinary course of business), (v) each of the Company and
its
Subsidiaries has conducted its business only in the ordinary course of business
in accordance with past practice, and (vi) there has not been a Material Adverse
Effect.
2.12 No
Actions.
Except
as disclosed in the SEC Filings, there are no legal or governmental actions,
suits, proceedings, inquiries or investigations pending and, to the knowledge
of
the Company, there are none threatened against or affecting the Company or
any
of its Subsidiaries or any of their respective officers or directors or any
property, assets or rights of the Company or any of its Subsidiaries, which
actions, suits or proceedings, individually or in the aggregate, would
reasonably be expected to prevent or materially and adversely affect the
transactions contemplated by this Agreement or which, if determined adversely
to
the Company or any of its Subsidiaries, would reasonably be expected to have
a
Material Adverse Effect; and, to the knowledge of the Company, there is no
existing or threatened labor disturbance by the employees of the Company or
any
of its Subsidiaries. Neither the Company nor any of its Subsidiaries is a party
to or subject to the provisions of any injunction, judgment, decree or order
of
any court, regulatory body administrative agency or other governmental body,
which would reasonably be expected to have a Material Adverse Effect. To the
knowledge of the Company, no executive officer, to the knowledge of the Company,
is, or is now expected to be, in violation of any material term of any
employment contract, confidentiality, disclosure or proprietary information
agreement or non-competition agreement, or any other contract or agreement
or
any restrictive covenant, and the continued employment of each such executive
officer does not subject the Company or any of its Subsidiaries to any material
liability with respect to any of the foregoing matters.
2.13
Investment
Company.
The
Company is not and, after giving effect to the offering and sale of the Shares
will not be, an “investment company” or an entity “controlled” by an “investment
company” as such terms are defined in the Investment Company Act of 1940, as
amended.
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2.14
No
Other Offering Materials.
The
Company has not distributed and will not distribute prior to the filing of
the
Registration Statement (which shall not be prior to the Closing Date) any
offering material in connection with the offering and sale of the Shares other
than the documents described in Section
2.1
hereof.
Neither the Company nor any person acting on its behalf has in the past or
will
hereafter take any action independent of the Placement Agent to sell, offer
for
sale or solicit offers to buy any securities of the Company that would require
that the offer, issuance or sale of the Shares, as contemplated by this
Agreement, be registered pursuant to the provisions of Section 5 of the
Securities Act.
2.15
Intellectual
Property.
Except
as disclosed in the SEC Filings or the Private Placement Memorandum, (i) the
Company and its Subsidiaries owns or has obtained valid and enforceable licenses
or options for the inventions, patent applications, patents, trademarks (both
registered and unregistered), trade names, copyrights and trade secrets
necessary for the conduct of the Company’s and its Subsidiaries’ businesses as
described in the Private Placement Memorandum and as currently conducted
(collectively, the “Intellectual
Property”);
and,
(ii) (a) there are no third parties who have any ownership rights to
any Intellectual Property that is owned by, or has been licensed to, the Company
or any of its Subsidiaries that would preclude the Company or any of its
Subsidiaries from conducting its business as currently conducted, except for
the
ownership rights of the owners of the Intellectual Property licensed or optioned
by the Company or any of its Subsidiaries; (b) to the knowledge of the
Company, there are currently no sales of any products that would constitute
an
infringement by third parties of any Intellectual Property owned, licensed
or
optioned by the Company or any of its Subsidiaries; (c) there is no pending
or,
to the knowledge of the Company, threatened action, suit, proceeding or claim
by
others challenging the rights of the Company or any of its Subsidiaries in
or to
any Intellectual Property owned, licensed or optioned by the Company or any
of
its Subsidiaries, other than claims that would not reasonably be expected to
have a Material Adverse Effect; (d) there is no pending or, to the knowledge
of
the Company, threatened action, suit, proceeding or claim by others challenging
the validity or scope of any Intellectual Property owned, licensed or optioned
by the Company or any of its Subsidiaries, other than actions, suits,
proceedings and claims that would not reasonably be expected to have a Material
Adverse Effect; and (e) there is no pending or, to the knowledge of the Company,
threatened action, suit, proceeding or claim by others that the Company or
any
of its Subsidiaries infringes or otherwise violates any patent, trademark,
copyright, trade secret or other proprietary right of others, other than
actions, suits, proceedings and claims that would not reasonably be expected
to
have a Material Adverse Effect. All material license agreements pursuant to
which (i) the Company and its Subsidiaries is granted rights in
Intellectual Property, or (ii) the Company or any of its Subsidiaries has
granted rights to others in Intellectual Property owned or licensed by the
Company or any of its Subsidiaries, are in full force and effect, except as
would not reasonably be expected to have a Material Adverse Effect and there
is
no material default by the Company or any of its Subsidiaries or, to the
knowledge of the Company, any other party thereto, except as would not
reasonably be expected to have a Material Adverse Effect. To the knowledge
of
the Company, neither the Company nor any of its Subsidiaries has made and is
not
making unauthorized use of any confidential information or trade secrets of
any
person. The Company believes it and each of its Subsidiaries is conducting
itself in a commercially reasonable manner to establish and preserve its
ownership of all material copyright, trade secret and other proprietary rights
with respect to its products and technology.
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2.16
Compliance.
The
Company and its Subsidiaries are in compliance with all applicable laws, rules,
regulations, orders, decrees and judgments applicable to them (collectively,
the
“Applicable
Laws”),
including, without limitation, all applicable local, state and federal
environmental laws and regulations and the provisions of the Xxxxxxxx-Xxxxx
Act
of 2002, as amended (“Xxxxxxxx-Xxxxx
Act”),
and
the rules and regulations of the Financial Industry Regulatory Authority (the
“FINRA”);
except where failure to be so in compliance would not have a Material Adverse
Effect. Neither the Company nor any of its Subsidiaries has received any notice
of purported or actual non-compliance with Applicable Laws nor, except to the
extent it would not individually or in the aggregate reasonably be expected
to
have a Material Adverse Effect, any notice of any material, actual or proposed
changes in the existing Applicable Laws.
There
is and has been no failure on the part of the Company or any of the Company’s
directors or officers, in their capacities as such, to comply with any provision
of the Xxxxxxxx-Xxxxx Act, including Section 402 related to loans and
Sections 302 and 906 related to certifications.
2.17
Registration
Statement Eligibility.
The
Company has not been notified by the Commission that it will not meet the
requirements for use of Form S-3 for registration of the resale of all of the
Shares in a single registration. The Company has no knowledge of any facts
or
circumstances (including, without limitation, any circumstances that may delay
or prevent the obtaining of accountant’s consents) that would reasonably be
expected to prohibit or delay the preparation or initial filing of the
Registration Statement on Form S-3 (except to the extent that any public float
requirement would be applicable) that will be available for the resale of the
Shares by each of the Purchasers.
2.18
No
Defaults.
Neither
the Company nor any of its Subsidiaries is in violation of any material
provision of its Charter or bylaws or any other organizational documents, as
applicable. Except as to defaults, violations and breaches which, individually
or in the aggregate, would not reasonably be expected to have a Material Adverse
Effect, neither the Company nor any of its Subsidiaries is in breach of or
default with respect to any provision of any agreement, judgment, decree, order,
mortgage, deed of trust, lease, franchise, license, indenture, permit or other
instrument to which it is a party or by which it is or any of its properties
are, bound; and there does not exist any state of fact which, with notice or
lapse of time or both, would constitute an event of default, as defined in
such
documents, on the part of the Company or any of its Subsidiaries, except such
defaults which, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.
2.19
Contracts.
All
material agreements to which the Company and its Subsidiaries is a party and
which are required to have been filed by the Company pursuant to the Securities
Act or the Exchange Act have been filed by the Company with the Commission
pursuant to the requirements of the Securities Act or the Exchange Act, as
applicable. Except for such agreements that have expired or terminated in
accordance with their terms prior to the date hereof, each such agreement is
in
full force and effect and is binding on the Company and/or its Subsidiaries,
as
applicable, and, to the knowledge of the Company, is binding upon such other
parties, in each case in accordance with its terms, and neither the Company,
any
of its Subsidiaries nor, to the knowledge of the Company, any other party
thereto, is in breach of or default under any such agreement, which breach
or
default would reasonably be expected to have a Material Adverse Effect. Neither
the Company, nor any of its Subsidiaries, has received any written notice
regarding the termination of any such agreements.
9
2.20
Nasdaq
Stock Market Listing. The
Company has applied to list its common stock on the Nasdaq Stock Market. The
Company shall use its commercially reasonable best efforts to have the Shares
listed on the Nasdaq Stock Market on or before the first date that the
Registration Statement is declared effective by the Commission.
2.21
Foreign
Corrupt Practices, etc. Neither
the Company, any of its Subsidiaries, their employees nor, to the knowledge
of
the Company, any agent or other person acting on behalf of the Company or any
of
its Subsidiaries, has, directly or indirectly, (i) used any corporate funds
for unlawful contributions, gifts, entertainment or other unlawful expenses
related to foreign or domestic political activity, (ii) made any unlawful
payment to foreign or domestic government officials or employees or to foreign
or domestic political parties or campaigns from corporate funds, (iii) failed
to
disclose fully any contribution made by the Company or any of its Subsidiaries
or made by any person acting on its behalf and of which the Company is aware
in
violation of law, or (iv) violated any provision of the Foreign Corrupt
Practices Act of 1977, as amended.
2.22
Money
Laundering.
The
operations of the Company and its Subsidiaries are and have been conducted
at
all times in compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as
amended, the money laundering statutes of all jurisdictions, the rules and
regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money
Laundering Laws”)
and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
Subsidiaries with respect to the Money Laundering Laws is pending or, to the
knowledge of the Company, threatened.
2.23
OFAC.
Neither
the Company nor any of its Subsidiaries nor, to the knowledge of the Company,
any director, officer, agent, employee or affiliate of the Company or any of
its
Subsidiaries is currently subject to any U.S. sanctions administered by the
Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”);
and
the Company will not directly or indirectly use the proceeds of the offering,
or
lend, contribute or otherwise make available such proceeds to any subsidiary,
joint venture partner or other person or entity, for the purpose of financing
the activities of any person currently subject to any U.S. sanctions
administered by OFAC.
2.24
Accountants
and Lawyers.
The firm
of Deloitte & Touche LLP, which has expressed its opinion with respect to
the financial statements included in the 2006 10-K and the consolidated
financial statements to be included or incorporated by reference in the
Registration Statement and the prospectus which forms a part thereof, is and
was, during the periods covered by their reports, an independent registered
public accounting firm with respect to the Company as required by the Exchange
Act, the Xxxxxxxx-Xxxxx Act and the Public Company Accounting Oversight Board.
There are no material disagreements of any kind presently existing, or
reasonably anticipated by the Company to arise, between the Company and the
accountants and lawyers formerly or presently employed by the
Company.
10
2.25
Properties.
Each of
the Company and its Subsidiaries has good and marketable title to all properties
and assets reflected as owned by it in the financial statements included in
the
2006 10-K and in the Private Placement Memorandum and that it otherwise purports
to own, and such properties and assets are not subject to any lien, mortgage,
pledge, or security interest except (i) those, if any, securing debt reflected
in the financial statements included in the SEC Filings, or (ii) those
which are not material in amount or do not adversely affect the use made and
intended to be made of such property by the Company or its Subsidiaries. Each
of
the Company and its Subsidiaries holds its leased properties under valid and
binding leases, with such exceptions as would not reasonably be expected to
have
a Material Adverse Effect. Except as disclosed in the SEC Filings, each of
the
Company and its Subsidiaries owns or leases all such properties as are necessary
to its operations as now conducted.
2.26
Environmental
Compliance.
Neither
the Company nor any of its Subsidiaries is in violation in any material respect,
or has received notice of any material violation with respect to, any applicable
environmental, safety or similar law applicable to the business of the Company
or any of its Subsidiaries; neither the Company nor any of its Subsidiaries
has
received any notice of, or has any knowledge of any occurrence or circumstance
which, with notice or passage of time, or both, would give rise to a material
claim against the Company or any of its Subsidiaries under or pursuant to any
Environmental Law with respect to any properties currently or previously owned,
leased or operated by the Company or any of its Subsidiaries, or the assets
of
the Company or any of its Subsidiaries, or arising out of the conduct of the
business of the Company or any of its Subsidiaries; the Company and its
Subsidiaries have received all material permits, licenses or other approvals
required of them under applicable federal and state occupational safety and
health and environmental laws and regulations to conduct their respective
businesses, and each of the Company and its Subsidiaries is in compliance in
all
material respects with all terms and conditions of any such permit, license
or
approval applicable to it; for purposes of this Agreement, the term
“Environmental
Law”
shall
mean any federal, state or local environmental law, statute, ordinance, rule
or
regulation, including, without limitation, the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C.
Sections 9601-9675, the Hazardous Materials Transportation Act, as amended,
49 U.S.C. Sections 5101-5127, the Resource Conservation and Recovery Act,
as amended, 42 U.S.C. Sections 6901-6992k, the Emergency Planning and
Community Right-to-Know Act of 1986, 42 U.S.C. Sections 11001-11050, the
Toxic Substances Control Act, 15 U.S.C. Sections 2601-2692, the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Sections 136-136y, the
Clean Air Act, 42 U.S.C. Sections 7401-7642, the Clean Water Act (Federal
Water Pollution Control Act), 33 U.S.C. Sections 1251-1387, the Safe
Drinking Water Act, 42 U.S.C. Sections 300f-300j-26, and the Occupational
Safety and Health Act, 29 U.S.C. Sections 651-678, and any analogous state
laws, as any of the above may be amended from time to time and the regulations
promulgated pursuant to each of the foregoing.
11
2.27
ERISA.
The
Company, the Subsidiaries and each “employee benefit plan” as defined under the
Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder (“ERISA”)
established or maintained by the Company, the Subsidiaries or their ERISA
Affiliates (as defined below) are in compliance in all material respects with
all presently applicable provisions of ERISA; no “reportable event” (as defined
in ERISA) has occurred or is reasonably expected to occur with respect to any
such employee benefit plan; neither the Company nor its Subsidiaries has
incurred or expects to incur liability under (i) Title IV of ERISA with respect
to termination of, or withdrawal from, any “employee benefit plan” or (ii)
Section 412, 4971, 4975 or 4980(B) of the Internal Revenue Code of 1986, as
amended, including the regulations and published interpretations thereunder
(the
“Code”);
each
“employee benefit plan” established or maintained by the Company, its
Subsidiaries or any of their ERISA Affiliates that is intended to be qualified
under Section 401(a) of the Code is so qualified and nothing has occurred,
whether by action or by failure to act, which would reasonably be expected
to
cause the loss of such qualification; and no “employee benefit plan” established
or maintained by the Company, its Subsidiaries or any of their ERISA Affiliates,
if such “employee benefit plan” were terminated, would have any material “amount
of unfunded benefit liabilities” (as defined under ERISA). For purposes of this
Agreement, the term “ERISA
Affiliate”
means,
with respect to the Company and any of its Subsidiaries, any member of any
group
of organizations described in Sections 414(b), (c), (m) or (o) of the Code
of which the Company or any of its Subsidiaries is a member.
2.28
Insurance.
Each of
the Company and its Subsidiaries maintains and will continue to maintain
insurance (issued by insurers of recognized financial responsibility) of the
types, against such losses and in the amounts, with such insurers and subject
to
deductibles and exclusions as are customary in the Company’s and its
Subsidiaries’ industry and otherwise reasonably prudent, including, without
limitation, insurance covering all real and personal property owned or leased
by
the Company and its Subsidiaries 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. Neither the
Company nor any Subsidiary has any reason to believe that it will be unable
to
renew its existing insurance coverage as and when such coverage expires or
to
obtain similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse
Effect.
2.29
Transfer
Taxes.
On the
Closing Date, all stock transfer or other taxes (other than income taxes),
if
applicable, which are required to be paid in connection with the sale and
transfer of the Shares to be sold to each Purchaser hereunder 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 complied with.
2.30
Taxes.
Each of
the Company and its Subsidiaries has filed on a timely basis all material
federal, state, local and foreign income and franchise tax returns required
to
be filed by it through the date hereof or had properly requested extension
thereof and has paid all material taxes shown as due thereon, and any related
material assessments, fines or penalties. Each of the Company and its
Subsidiaries has made reasonably adequate charges, accruals and reserves in
the
applicable financial statements referred to in Section
2.3
above in
respect of all federal, state, local and foreign income and franchise taxes
for
all periods as to which the tax liability of the Company and its Subsidiaries
has not been finally determined. The Company has no knowledge of a tax
deficiency which has been or might be asserted or threatened against it or
any
of its Subsidiaries.
12
2.31
Taxable
Mortgage Pool.
Neither
the Company, any of its Subsidiaries nor any of their assets will be treated
as
a taxable mortgage pool. Neither the Company nor any of its Subsidiaries shall
hold any residual interest in a real estate mortgage investment
conduit.
2.32
REIT
Status.
The
Company elected to be taxed as a real estate investment trust (a “REIT”)
under
the Code commencing with its taxable year ended December 31, 2004;
commencing with the Company’s taxable year ended December 31, 2004, the
Company has been organized and operated in conformity with the requirements
for
qualification and taxation as a REIT under the Code, and its current and
proposed ownership and operations will allow the Company to continue to satisfy
the requirements for qualification and taxation as a REIT under the Code for
its
taxable year ending December 31, 2008 and in the future.
2.33
Price
of Common Stock.
Neither
the Company nor any of its officers, directors, affiliates or, to the Company’s
knowledge, its agents has taken, or will take, directly or indirectly, any
action designed to cause or result in, or which has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of
the
price of the shares of the Common Stock to facilitate the sale or resale of
the
Shares.
2.34
Finder’s
Fees.
The
Company has not incurred any liability for any finder’s fees or similar payments
in connection with the transactions contemplated by the Operative Agreements,
except with respect to the Placement Agent. The Purchasers shall have no
obligation with respect to any fees or with respect to any claims made by or
on
behalf of other persons for fees of a type contemplated in this Section
2.34
under an
agreement to which the Company is a party or otherwise aware of that may be
due
in connection with the transactions contemplated by this Agreement.
2.35
Non-Public
Information.
The
Company has not disclosed to the Placement Agent or any of the Purchasers,
whether in the Private Placement Memorandum or otherwise, information that
would
constitute material non-public information as of the Closing Date, other than
the transactions contemplated by this Agreement. The Company understands and
confirms that each Purchaser shall be relying on the foregoing representations
in effecting transaction in securities of the Company.
2.36
Investment
and Risk-Adjusted Capital Guidelines.
The
Company is, and at all times has been, in material compliance with its
investment and risk-adjusted capital guidelines.
2.37
Related
Party Transactions.
Other
than this Offering, no transaction has occurred and no relationship, direct
or
indirect, exists between or among the Company, any of its Subsidiaries and
its
or their affiliates, officers, directors, stockholders, customers or suppliers
or any affiliate or affiliates of any such officer, director, stockholder,
customer or supplier that is required to have been described under applicable
securities laws in its SEC Filings and is not so described in such filings.
2.38
Insider
Loans.
There
are
no outstanding loans or advances or guarantees of indebtedness by the Company
or
any of the Subsidiaries to or for the benefit of any of the officers, directors
or managers of the Company or any of its Subsidiaries or any of the members
of
the families of any of them.
13
2.39
Director
Independence.
Each
director of the Company which is designated as “Independent” in the SEC Filings
satisfies the requirements for independence under the Xxxxxxxx-Xxxxx Act and
the
rules of the NASDAQ Stock Market;
and a
majority of the Company’s directors are so “Independent”.
2.40
Off-Balance
Sheet Arrangements.
There
is no transaction, arrangement or other relationship between the Company and/or
any of its Subsidiaries and an unconsolidated or other off-balance sheet entity
that is required to be disclosed by the Company in its SEC Filings and is not
so
disclosed or that has or otherwise would reasonably be expected to have a
Material Adverse Effect.
2.41
Governmental
Permits, Etc.
Each of
the Company and its Subsidiaries has all franchises, licenses, certificates,
consents, accreditations, certifications, approvals and other authorizations
from such federal, state or local government or governmental agency, department
or body that are currently required for the operation of the business of the
Company and its Subsidiaries as currently conducted (“Governmental
Permits”),
except where the failure to have such Governmental Permits would not reasonably
be expected to have a Material Adverse Effect. Neither the Company nor its
Subsidiaries are in violation of or has default on any Governmental Permit
or
received any notice of proceedings relating to the revocation or modification
of
any Governmental Permit which, if the subject of an unfavorable decision, ruling
or finding, would reasonably be expected to have a Material Adverse
Effect.
2.42
Offering.
Subject
to the accuracy of the Purchasers’ representations in Section 3
of this
Agreement, the offer, sale and issuance of the Shares to the Purchasers at
the
Closing, 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 qualification or registration requirements of all applicable
state securities laws.
2.43
Solvency.
Based
on the financial condition of the Company as of the Closing Date after giving
effect to the receipt by the Company of the proceeds from the sale of the Shares
hereunder, (i) the fair saleable value of the Company’s assets exceeds the
amount that will be required to be paid on or in respect of the Company’s
existing debts and other liabilities (including known contingent liabilities)
as
they mature; (ii) the Company’s assets do not constitute unreasonably small
capital to carry on its business as now conducted and as proposed to be
conducted including its capital needs taking into account the particular capital
requirements of the business conducted by the Company, and projected capital
requirements and capital availability thereof; and (iii) the current cash flow
of the Company, together with the proceeds the Company would receive, were
it to
liquidate all of its assets, after taking into account all anticipated uses
of
the cash, would be sufficient to pay all amounts on or in respect of its
liabilities when such amounts are required to be paid.
2.44
Controls
and Procedures.
The
Company has implemented controls and other procedures that are designed to
ensure that information required to be disclosed by the Company in the reports
that it files or submits under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the Commission’s
rules and forms and is accumulated and communicated to the Company’s management,
including its co-chief executive officers and chief financial officer, or
persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure; the Company makes and keeps books, records and
accounts, which, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the Company and its Subsidiaries;
and the Company maintains a system of internal control over financial reporting
sufficient to provide reasonable assurance that (i) transactions involving
the
Company or any of its Subsidiaries are executed in accordance with management’s
general or specific authorizations; (ii) transactions involving the Company
or
any of its Subsidiaries are recorded as necessary to permit preparation of
financial statements in conformity with GAAP as applied in the United States
and
to maintain asset accountability; (iii) access to assets is permitted only
in
accordance with management’s general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
14
2.45
General
Solicitation.
Neither
the Company, nor any affiliate of the Company, nor any other person or entity
authorized by the Company to act on its behalf, including, without limitation,
the Placement Agent, has engaged in a general solicitation or general
advertising (within the meaning of Regulation D of the Securities Act) of
investors with respect to offers or sales of the Shares. The Company has offered
the Shares for sale only to the Purchasers and certain other “accredited
investors” within the meaning of Rule 501 under the Securities Act.
2.46
No
Integrated Offering.
Neither
the Company, nor any affiliate of the Company, nor any person acting on its
or
their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that
would cause the offering or issuance of the Shares to be integrated with prior
offerings by the Company for purposes of the Securities Act which would cause
Regulation D or any other applicable exemption from registration under the
Securities Act to be unavailable, or would cause any applicable state securities
laws exemptions or any applicable stockholder approval provisions exemptions,
including, without limitation, under the rules and regulations of any national
securities exchange or automated quotation system on which any of the securities
of the Company are listed or designated to be unavailable, nor will the Company
take any action or steps that would cause the offering or issuance of the Shares
to be integrated with other offerings.
2.47
Purchaser
Representations.
The
Company acknowledges and agrees that no Purchaser makes or has made any
representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in Section
4
hereof.
2.48
Acknowledgment
Regarding Purchasers’ Purchase of Purchased Securities.
The
Company acknowledges and agrees that each of the Purchasers is acting solely
in
the capacity of an arm’s length purchaser with respect to this Agreement and the
transactions contemplated hereby. The Company further acknowledges that no
Purchaser is acting as a financial advisor or fiduciary of the Company (or
in
any similar capacity) with respect to this Agreement and the transactions
contemplated hereby and any advice given by any Purchaser or any of their
respective representatives or agents in connection with this Agreement and
the
transactions contemplated hereby is merely incidental to the Purchasers’
purchase of the Purchased Securities. The Company further represents to each
Purchaser that the Company’s decision to enter into this Agreement has been
based solely on the independent evaluation of the transactions contemplated
hereby by the Company and its representatives.
15
2.49
U.S.
Real Property Holding Corporation.
The
Company is not, has never been, and so long as any Shares remain outstanding,
shall not become, a U.S. real property holding corporation within the meaning
of
Section 897 of the Code and the Company shall so certify upon any Purchaser's
request.
SECTION
3. Purchaser’s
Representations and Warranties.
Each
Purchaser represents and warrants to the Company with respect to only itself
that as of the Effective Date and the Closing:
3.1
Information.
Such
Purchaser is knowledgeable, sophisticated and experienced in making, and is
qualified to make, decisions with respect to 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 necessary and relevant, including the Private Placement
Memorandum and SEC Filings, in making an informed decision to purchase the
Shares. Such Purchaser further represents that it has had an opportunity to
ask
questions of and receive answers from the Company regarding the terms and
conditions of the offering of Shares and the business, properties, prospects
and
financial condition of the Company. Such Purchaser understands that its
investment in the Shares involves a significant degree of risk. Such Purchaser
has the knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of an investment in the Shares and
has the ability to bear the economic risks of an investment in the Shares for
an
indefinite period of time. The Purchaser acknowledges that the Placement Agent
has made no representations or warranties regarding the Company.
3.2
Investment
Purpose.
Such
Purchaser is acquiring the number of Shares set forth opposite its name on
the
Schedule of Purchasers attached hereto as Schedule
A
in the
ordinary course of its business and for its own account for investment purposes
only and with no present intention of distributing any of such Shares, and
no
arrangement or understanding exists with any other persons regarding the
distribution of such Shares; provided, however, that in making such
representation, such Purchaser reserves the right to sell, transfer or otherwise
dispose of the Shares at any time subject to and in accordance with (i) the
provisions of this Agreement and (ii) the Federal and state securities laws
applicable to such sale, transfer or disposition.
3.3
Accuracy
of Information Provided.
Such
Purchaser has completed or caused to be completed the Registration Statement
Questionnaire attached as Appendix
I
to the
Registration Rights Agreement, for use in preparation of the Registration
Statement, and the information in such Registration Statement Questionnaire
is
true, correct and complete as of the Effective Date and will be true, correct
and complete as of the effective date of the Registration Statement (provided
that, if necessary to make the statement accurate, such Purchaser shall be
entitled to update such information prior to the effective date of the
Registration Statement).
16
3.4
Accredited
Investor.
Such
Purchaser is an “accredited investor” within the meaning of Rule 501(a) of
Regulation D promulgated under the Securities Act.
3.5
Reliance
on Exemptions.
Such
Purchaser understands that the Shares are being offered and sold to it in
reliance upon specific exemptions from the registration requirements of the
Securities Act and applicable state securities laws and that the Company is
relying upon the truth, accuracy and completeness of, and such Purchaser’s
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of such Purchaser set forth herein in order to determine
the
availability of such exemptions and the eligibility of the Purchaser to acquire
the Shares.
3.6
Offering
Materials.
Such
Purchaser hereby acknowledges and agrees that it is prohibited from reproducing
or distributing the Private Placement Memorandum, the Operative Agreements
or
any other offering materials, in whole or in part, or divulging or discussing
any of their contents, except for use internally and by its legal counsel,
except as required by law or legal process or except to the extent such
information is made publicly available other than as a result of a breach by
such Purchaser (or any of its affiliates or their representatives) of its
confidentiality obligations hereunder. Further, such Purchaser understands
that
the existence and nature of all conversations and presentations, if any,
regarding the Company and this offering must be kept strictly confidential
until
such time as the Company makes a public announcement of the sale of Shares.
Such
Purchaser understands that the federal securities laws impose restrictions
on
trading based on information regarding this offering.
3.7 No
Governmental Review.
Such
Purchaser understands that no United States federal or state agency or other
government or governmental agency has passed upon or made any recommendation
or
endorsement of the Shares or the fairness or suitability of the investment
in
the Shares nor have such authorities passed upon or endorsed the merits of
the
offering of the Shares.
3.8
Transfer
or Resale.
(a) Such
Purchaser understands that the Shares have not been registered under the
Securities Act or any state securities laws, and such Purchaser agrees that
it
will not, sell, offer to sell, solicit offers to buy, dispose of, loan, pledge
or grant any right with respect to (collectively, a “Disposition;”
and
the term “Dispose”
shall
have the correlative meaning) the Shares, unless (a) the Shares are
registered under the Securities Act, (b) such Purchaser shall have
delivered to the Company an opinion of counsel in form and substance reasonably
acceptable to the Company, to the effect that, in connection with such
Disposition, registration is not required under the Securities Act or any
applicable state securities law due to the applicability of an exemption
therefrom, or (c) such Shares have been Disposed of in accordance with Rule
144
under the Securities Act or any successor provision. In that connection, such
Purchaser is aware of Rule 144 under the Securities Act and the restrictions
imposed thereby. Such Purchaser acknowledges and agrees that no sales of the
Shares may be made under the Registration Statement and that the Shares are
not
transferable on the books of the Company pursuant to a sale made under the
Registration Statement unless the certificate submitted to the transfer agent
evidencing the Shares is accompanied by a separate Purchaser’s Certificate of
Subsequent Sale: (i) in the form of Appendix
II
hereto;
(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, the Securities Act and any
applicable state securities or blue sky laws, and (B) the requirement of
delivering a current prospectus, if applicable, has been satisfied.
17
(b)
Such
Purchaser that is located outside the United States acknowledges that, to its
knowledge, no action has been or will be taken in any jurisdiction outside
the
United States by the Company or the Placement Agent that would permit an
offering of the Shares, or possession or distribution of offering materials
in
connection with the issue of the Shares, in any jurisdiction outside the United
States where action for that purpose is required. Such Purchaser outside the
United States will comply with all applicable laws and regulations in each
foreign jurisdiction in which it purchases, offers, sells or delivers Shares
or
has in its possession or distributes any offering material, in all cases at
its
own expense. The Placement Agent is not authorized to make any representation
or
use any information in connection with the issue, placement, purchase and sale
of the Shares.
(c)
Such
Purchaser hereby covenants with the Company not to make any Disposition of
the
Shares without complying with the provisions of the Operative Agreements, and,
if then applicable, without effectively causing the prospectus delivery
requirement under the Securities Act to be satisfied, and such Purchaser
acknowledges that the certificates evidencing the Shares will be imprinted
with
a legend that prohibits their Disposition except in accordance therewith. Such
Purchaser acknowledges that there may occasionally be times when the Company
in
accordance with the terms of the Registration Rights Agreement, based on the
advice of its counsel, determines that it must suspend the use of the prospectus
forming a part of the Registration Statement (as amended or supplemented by
any
amendment or prospectus supplement, including post-effective amendments, the
“Prospectus”),
until
such time as an amendment to the Registration Statement has been filed by the
Company and declared effective by the Commission or until the Company has
amended or supplemented such Prospectus or until the expiration of the time
period permitted under the Registration Rights Agreement.
3.9
Legends.
Such
Purchaser understands that the Shares may bear restrictive legends in
substantially the following form (and a stop-transfer order may be placed
against transfer of the certificates for the Shares):
Securities
Law Legend
“The
securities represented by this certificate have not been registered under the
Securities Act of 1933, as amended (the “Act”), or under the securities laws of
any other jurisdiction. The securities may not be sold, transferred or assigned
in the absence of an effective registration statement for the securities under
the Act, unless sold pursuant to Rule 144 under the Act or another available
exemption from registration under the Act.”
18
Ownership
Limitation Legend
“Such
Purchaser understands that the certificates representing the Shares will include
the following legend. “The
shares represented by this certificate are subject to restrictions on Beneficial
and Constructive Ownership and Transfer. Subject to certain further restrictions
and except as expressly provided in the Corporation’s Charter, (i) no Person may
Beneficially or Constructively Own shares of the Corporation’s Common Stock in
excess of nine and nine-tenths percent (9.9%) in value or in number of shares,
whichever is more restrictive, of the aggregate of the outstanding shares of
Common Stock of the Corporation unless such Person is an Excepted Holder (in
which case the Excepted Holder Limit shall be applicable); (ii) no Person may
Beneficially or Constructively Own shares of Capital Stock of the Corporation
in
excess of nine and nine-tenths percent (9.9%) in value of the aggregate of
the
outstanding shares of Capital Stock of the Corporation unless such Person is
an
Excepted Holder (in which case the Excepted Holder Limit shall be applicable);
(iii) no Person may Beneficially or Constructively Own shares of Capital Stock
that would result in the Corporation being “closely held” under
Section 856(h) of the Internal Revenue Code of 1986, as amended (the
“Code”); (iv) no Person may Transfer shares of Capital Stock that would result
in the Capital Stock of the Corporation being beneficially owned by less than
one hundred (100) Persons (determined without reference to any rules of
attribution) and (v) no Disqualified Organization shall Beneficially Own any
shares of Capital Stock, and no Person shall Transfer shares of Capital Stock
to
the extent that such Transfer would result in shares of Capital Stock being
Beneficially Owned by a Disqualified Organization. Any Person who Beneficially
or Constructively Owns or attempts to Beneficially or Constructively Own shares
of Capital Stock which causes or will cause a Person to Beneficially or
Constructively Own shares of Capital Stock in excess or in violation of the
above limitations must immediately notify the Corporation. If any of the
restrictions on transfer or ownership are violated, the shares of Capital Stock
represented hereby will be automatically transferred to a Trustee of a
Charitable Trust for the benefit of one or more Charitable Beneficiaries. In
addition, the Corporation may redeem shares upon the terms and conditions
specified by the Board of Directors in its sole discretion if the Board of
Directors determines that ownership or a Transfer or other event may violate
the
restrictions described above. Furthermore, upon the occurrence of certain
events, attempted Transfers in violation of the restrictions described above
may
be void ab initio.
All
capitalized terms in this legend have the meanings defined in the Charter of
the
Corporation, as the same may be amended from time to time, a copy of which,
including the restrictions on transfer and ownership, will be furnished to
each
holder of Capital Stock of the Corporation on request and without charge.
Requests for such a copy may be directed to the Secretary of the Corporation
at
its principal office.”
19
The
securities law legend above shall be removed by the Company from any certificate
evidencing the Shares if a registration statement under the Securities Act
is at
that time in effect with respect to the legended security or the Company is
provided with documentation reasonably satisfactory to the Company and its
counsel that such security can be freely transferred in a public sale without
such a registration statement being in effect.
If
the
Company shall fail for any reason or for no reason to issue to the Purchaser
unlegended certificates or issue such Shares to such Purchaser by electronic
delivery at the applicable balance account at the Depository Trust
Company within three (3) business days after the receipt of documents
necessary for the removal of the legend set forth in this Section 3.9
above
(the “Removal
Date”),
then
in addition to all other remedies available to the Purchaser, if on or after
the
Business Day immediately following such three (3) business day period, the
Purchaser purchases (in an open market transaction or otherwise) shares of
Common Stock to deliver in satisfaction of a sale by the Purchaser of such
Shares that the Purchaser anticipated receiving without legend from the Company
(a “Buy-In”),
then
the Company shall, within three (3) Business Days after the Purchaser’s request
and in the Purchaser’s discretion, either (i) pay cash to the Purchaser in an
amount equal to the Purchaser’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased (the
“Buy-In
Price”),
at
which point the Company’s obligation to deliver such unlegended Shares shall
terminate, or (ii) promptly honor its obligation to deliver to the Purchaser
such unlegended Shares as provided above and pay cash to the Purchaser in an
amount equal to the excess (if any) of the Buy-In Price over the product of
(A)
such number of shares of Common Stock, times (B) the Closing Bid Price on the
Removal Date. For the purpose of this Agreement, “Closing
Bid Price”
means,
for any security as of any date, the last closing bid price of such security
on
the principal securities exchange or trading market where such security is
listed or traded as reported by Bloomberg Financial Markets (“Bloomberg”),
or if
the foregoing does not apply, the last closing bid price of such security in
the
over-the-counter market on the electronic bulletin board for such security
as
reported by Bloomberg, or, if no closing bid price is reported for such security
by Bloomberg, the average of the bid prices of any market makers for such
security as reported in the “pink sheets” by Pink Sheets LLC (formerly the
National Quotation Bureau, Inc.). If the Closing Bid Price cannot be calculated
for a security on a particular date on any of the foregoing bases, the Closing
Bid Price of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. All such determinations
to be
appropriately adjusted for any stock dividend, stock split, stock combination
or
other similar transaction during the applicable calculation period.
3.10
Residency.
Such
Purchaser’s principal executive offices are in the jurisdiction set forth
immediately below the Purchaser’s name on the signature pages
hereto.
3.11
Authorization;
Enforcement; Validity.
Such
Purchaser has the power, authority and capacity to enter into the Operative
Agreements and to consummate the transactions contemplated hereby and thereby,
and has taken all necessary action to authorize the execution, delivery and
performance of the Operative Agreements. Upon the execution and delivery of
the
Operative Agreements, and assuming the valid execution thereof by the Company,
the Operative Agreements shall constitute valid and binding obligations of
such
Purchaser, enforceable in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors’ and contracting parties’ rights generally
and except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as agreements by such Purchaser to indemnify others
may be violative of public policy and, thus, unenforceable.
20
3.12
No
Conflicts.
The
execution and performance of the Operative Agreements do not conflict with
any
agreement to which such Purchaser is a party or is bound, any court order or
judgment affecting such Purchaser, or the constituent documents of such
Purchaser, except for such conflicts as would not reasonably be expected to
have
a material adverse effect on the transactions contemplated by this
Agreement.
3.13
No
Intent to Effect a Change of Control.
Such
Purchaser has no present intent to acquire or hold the securities with a purpose
or effect of changing or influencing control of the Company, as such phrase
is
understood in Regulation 13D under the Exchange Act.
3.14
No
Adverse Litigation.
Such
Purchaser is not a party to any litigation against the Company.
3.15
No
Advice.
Such
Purchaser understands that nothing in this Agreement or any other materials
presented to such Purchaser in connection with the purchase and sale of the
Shares constitutes legal, tax or investment advice. Such Purchaser has consulted
its own legal, tax and investment advisors as it, in its sole discretion, has
deemed necessary or appropriate in connection with its purchase of Shares.
The
foregoing, however, does not limit or modify the representations and warranties
of the Company in Section
2
of this
Agreement or the right of the Purchasers to rely on such representations and
warranties.
3.16
No
Finder’s Fees.
Such
Purchaser has not incurred any liability for any finder’s fees or similar
payments in connection with the transactions herein contemplated.
3.17
No
General Solicitation.
Such
Purchaser is not purchasing the Shares as a result of any advertisement,
article, notice or other communication regarding the Shares published in any
newspaper, magazine or similar media or broadcast over television or radio
or
presented at any seminar or any other general solicitation or general
advertisement.
3.18
Prohibited
Transactions.
(i)
During
the period beginning from the time such Purchaser was initially contacted about
the issue and sale of the Shares to the date hereof, neither such Purchaser
nor
any affiliate of such Purchaser, foreign or domestic, has, directly or
indirectly, effected or agreed to effect any “short sale” (as defined in Rule
200 under Regulation SHO), whether or not against the box, established any
“put
equivalent position” (as defined in Rule 16a-1(h) under the Exchange Act) with
respect to the Common Stock, borrowed any shares of Common Stock, or granted
any
other right (including, without limitation, any put or call option) with respect
to the Common Stock or with respect to any security that includes, relates
to or
derived any significant part of its value from the Common Stock or otherwise
sought to hedge its position in the Company’ securities (each, a “Prohibited
Transaction”).
21
(ii)
Prior
to
the earliest to occur of (i) the termination of this Agreement, (ii) the date
the Registration Statement is declared effective by the Commission, and (iii)
180 days from the Closing Date such Purchaser shall not, and shall cause its
Affiliates not to engage directly or indirectly, in any Prohibited Transaction.
SECTION
4. Covenants.
4.1
Obligations.
Each
party shall timely satisfy each of the conditions to be satisfied by it as
provided in Sections
5
and
6
of this
Agreement.
4.2
Securities
Laws Disclosure.
On or
before 8:30 a.m., eastern time, on the second business day following the date
of
this Agreement, the Company shall file a Current Report on Form 8-K with the
Commission (i) describing the terms of the transactions contemplated by the
Operative Agreements and including this Agreement and the Registration Rights
Agreement as exhibits to such Current Report on Form 8-K and
(ii) describing any material non-public information set forth in the
Private Placement Memorandum. The
Company shall not, and shall cause each of its Subsidiaries and its and each
of
their respective officers, directors, employees and agents, not to, provide
any
Purchaser with any material, nonpublic information regarding the Company or
any
of its Subsidiaries from and after the filing of such Form 8-K with the
Commission without the consent of such Purchaser.
4.3
Use
of
Proceeds.
The
Company shall use the proceeds from the sale of the Shares as described under
“Use of Proceeds” in the Private Placement Memorandum.
4.4
Registration
Priority.
The
Company shall not file a registration statement to register any shares of Common
Stock (other than the Shares purchased pursuant to this Agreement) or any
Preferred Stock or other securities convertible into Common Stock prior to
the
effectiveness of the Registration Statement unless the Purchasers are provided
an opportunity to have all of the Shares included in such registration
statement.
4.5
Lock-Up.
Until
the later of 120 days from the Closing Date or 90 days after the effective
date of a registration statement covering the resale of the Shares, the Company
shall not, without the prior written consent of the holders of at least a
majority of the shares constituting Registrable Securities (as defined in the
Registration Rights Agreement), at the time outstanding, (i) directly or
indirectly, offer, pledge, sell, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right
or
warrant to purchase or otherwise transfer or dispose of any share of Common
Stock, Series A Preferred Stock or other security of the Company or any of
its
subsidiaries or any security convertible into or exercisable or exchangeable
for
Common Stock or other securities of the Company or any of its subsidiaries
or
file any registration statement under the Securities Act (other than a
Registration Statement on Form S-8 or permitted to be filed under the
Registration Rights Agreement) with respect to any of the foregoing or (ii)
enter into any swap or any other agreement or any transaction that transfers,
in
whole or in part, directly or indirectly, the economic consequence of ownership
of the Common Stock, whether any such swap or transaction described in clause
(i) or (ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply
to issuances of equity incentive awards pursuant to the Company’s 2005
Stock Incentive Plan and 2004 Stock Incentive Plan or any issuances of Common
Stock as a result of the conversion of or redemption of the Series A Preferred
Stock pursuant to its terms.
22
4.6
Significant
Shareholder Lock-Up Agreement.
The
Company agrees to undertake commercially reasonable best efforts to cause Xxxxx
X. Xxxxxxx to execute a lock-up agreement, substantially in the form of
Exhibit
C
(except
that such lock-up shall commence on the Closing Date and expire on May 30,
2008), and to deliver such executed lock-up agreement to the Placement Agent
no
later than the Closing Date.
4.7
Blue
Sky Law.
The
Company agrees to make commercially reasonable best efforts to qualify the
Shares under the state securities or blue sky laws of any jurisdiction in which
such qualification may be required in connection with the sale and distribution
of the Shares.
SECTION
5. Conditions
to the Company’s Obligation to Close.
The
obligation of the Company to issue and sell the Shares to each respective
Purchaser at the Closing is subject to the satisfaction, at or before the
Closing Date, of each of the following conditions, provided that these
conditions are for the Company’s sole benefit and may be waived by the Company
at any time in its sole discretion by providing such Purchaser with prior
written notice thereof:
5.1
Operative
Agreements.
Such
Purchaser shall have executed each of the Operative Agreements to which it
is a
party and delivered the same to the Company.
5.2
Payment
of Purchase Price.
The
Company shall have received from such Purchaser the full amount of the purchase
price for the Shares being purchased by such Purchaser at the Closing, by wire
transfer of immediately available funds pursuant to the wire transfer
instructions attached hereto as Schedule
B.
5.3
No
Injunctions or Restraints.
No
litigation properly filed and served on the Company by a governmental authority
with competent jurisdiction over the Company shall be pending which seeks to
enjoin or prohibit the Company from consummating the transactions contemplated
by the Operative Agreements, and no temporary restraining order, preliminary
or
permanent injunction or other order issued by any court of competent
jurisdiction over the Company shall be in effect which seeks to enjoin or
prohibit the Company from consummating the transactions contemplated by the
Operative Agreements.
5.4
Representations
and Warranties; Covenants.
The
representations and warranties of such Purchaser shall be true, correct and
complete in all material respects (except to the extent that any of such
representations and warranties is already qualified as to materiality in
Section
3
above,
in which case such representations and warranties shall be true, correct and
complete without further qualification) as of the date when made and as of
the
Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true, correct and
complete as of such date), and such Purchaser shall have performed, satisfied
and complied with in all material respects the covenants, agreements and
conditions required by the Operative Agreements to be performed, satisfied
or
complied with by such Purchaser at or prior to the Closing Date.
23
SECTION
6. Conditions
to each Purchaser’s Obligation to Close.
The
obligation of each Purchaser hereunder to purchase the Shares from the Company
at the Closing is subject to the satisfaction, at or before the Closing Date,
of
each of the following conditions, provided that these conditions are for each
Purchaser’s sole benefit and may be waived by such Purchaser at any time in its
sole discretion by providing the Company with prior written notice
thereof:
6.1
Operative
Agreements.
The
Company shall have executed each of the Operative Agreements to which it is
a
party and delivered the same to such Purchaser.
6.2
Delivery
of Shares.
The
Company shall have executed and delivered to such Purchaser one or more
certificates representing the Shares being purchased by such Purchaser at the
Closing as set forth on the Schedule of Purchasers attached hereto as
Schedule
A.
6.3
Opinion
of Counsel.
The
Company shall have delivered to the Placement Agent the opinion of Hunton &
Xxxxxxxx LLP, legal counsel of the Company, dated as of the Closing Date, in
the
form of Exhibit
B
attached
hereto. Such opinion also shall state that each of the Purchasers may rely
thereon as though it were addressed to such Purchaser.
6.4
Lock-Up
Agreement.
On the
Effective Date, the Company shall have delivered to the Placement Agent an
agreement in the form of Exhibit
C
(the
“Lock-up
Agreement”)
attached hereto from each officer and director of the Company. Such agreement
shall be in full force and effect on the Closing Date.
6.5
“Comfort”
Letter.
At the
Closing, the Company shall have delivered to the Placement Agent letters
from Deloitte & Touche LLP dated, respectively, as of the Effective Date and
the Closing Date, in form and substance reasonably satisfactory to the Placement
Agent, relating to the financial statements, including any pro forma financial
statements, of the Company, and such other matters customarily covered by
comfort letters issued in connection with registered public
offerings.
Such
letters also shall state that each of the Purchasers may rely thereon as though
it were addressed to such Purchaser.
6.6
No
Injunctions or Restraints.
No
litigation properly filed and served on the Company by a governmental authority
with competent jurisdiction over the Company shall be pending which seeks to
enjoin or prohibit the Company from consummating the transactions contemplated
by the Operative Agreements, and no temporary restraining order, preliminary
or
permanent injunction or other order issued by any court of competent
jurisdiction over the Company shall be in effect which seeks to enjoin or
prohibit the Company from consummating the transactions contemplated by the
Operative Agreements.
6.7
Representations
and Warranties; Covenants.
The
representations and warranties of the Company shall be true, correct and
complete in all material respects (except to the extent that any of such
representations and warranties is already qualified as to materiality in
Section
2
above,
in which case such representations and warranties shall be true, correct and
complete without further qualification) as of the date when made and as of
the
Closing Date as though made at the Closing Date, and the Company shall have
performed, satisfied and complied with in all material respects the covenants,
agreements and conditions required by the Operative Agreements to be performed,
satisfied or complied with by the Company at or prior to the Closing Date.
Such
Purchaser shall have received a certificate, executed by the President of the
Company, dated as of the Closing Date, to the foregoing effect.
24
6.8
Material
Adverse Change.
Subsequent to the respective dates as of which information is given in the
SEC
Filings, there has been no (i) change, event, circumstance or development that
could reasonably be expected to have a Material Adverse Effect (whether or
not
arising in the ordinary course of business), (ii) transaction which is material
to the Company and its Subsidiaries, considered as one enterprise, (iii) any
obligation, direct or contingent, that is material to the Company and its
Subsidiaries, considered as one enterprise, incurred by the Company and the
Subsidiaries, considered as one enterprise, (iv) any change in the capital
stock
or material change in outstanding indebtedness of the Company and its
Subsidiaries, considered as one enterprise, considered as one enterprise, or
(v)
any dividend or distribution of any kind declared, paid or made on the capital
stock of the Company or its Subsidiaries, or any loss or damage (whether or
not
insured) to the property of the Company or Subsidiaries which has been sustained
or will have been sustained which has a Material Adverse Effect.
6.9 Good
Standing Certificate.
The
Company shall have delivered to the Purchasers a certificate of the State
Department of Assessments and Taxation of the State of Maryland, dated as of
a
date within ten days of the date of the Closing, with respect to the good
standing of the Company.
6.10
Secretary’s
Certificate.
The
Company shall have delivered to the Purchasers a certificate of the Company
executed by the Company’s Secretary attaching and certifying to the truth and
correctness of (i) the Company’s Charter, (ii) the Company’s bylaws and (iii)
the resolutions adopted by the Company’s Board of Directors in connection with
the transactions contemplated by this Agreement.
6.11
Other
Actions.
The
Company shall have executed such certificates, agreements, instruments and
other
documents, and taken such other actions as shall be customary or reasonably
requested by the Purchasers in connection with the transactions contemplated
hereby.
SECTION
7. Miscellaneous
Provisions.
7.1
Survival
of Representations and Warranties.
A
Purchaser’s election to purchase the Shares being purchased by such Purchaser
based upon the statements in the certificate described in Section
6.7
of this
Agreement shall not be construed as a waiver of such Purchaser’s right to
remedies for the inaccuracy of the representations and warranties made by the
Company in this Agreement and in such certificate. Notwithstanding any
investigation made by any party to this Agreement or by the Placement Agent,
all
representations and warranties made by the Company and the Purchasers herein
and
in the certificates for the Shares delivered pursuant hereto shall survive
the
execution of this Agreement, the delivery to the Purchasers of the Shares being
purchased and the payment in exchange therefor.
25
7.2
Placement
Agent.
The
Purchasers acknowledge that the Company intends to pay to the Placement Agent
a
fee in respect of the sale of the Shares to the Purchasers. Each of the parties
hereto hereby represents that, on the basis of any actions and agreements by
it,
there are no other brokers or finders entitled to compensation in connection
with the sale of the Shares to the Purchasers. The Placement Agent is not an
agent of, and is not entitled to make any representations to the Purchasers
or
execute any documents on behalf of, the Company, and the Purchasers acknowledge
that the Placement Agent is not authorized to bind the Company in any
way.
7.3
Notices.
Any
notices, consents, waivers or other communications required or permitted to
be
given under the terms of this Agreement must be in writing and will be deemed
to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile; or (iii) two (2) business days after
deposit with a nationally recognized overnight delivery service, in each case
properly addressed to the party to receive the same. The addresses and facsimile
numbers for such communications shall be:
(a)
if
to the
Company, to:
New
York
Mortgage Trust, Inc.
1301
Avenue of the Xxxxxxxx, 0xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Facsimile: 000-000-0000
Attention: President
with
a
copy to:
Hunton
& Xxxxxxxx LLP
000
Xxxx
Xxxx Xxxxxx
Xxxxxxxx,
Xxxxxxxx 00000
Facsimile: 804-788-8218
Attention: Xxxxxx
X.
XxXxx, Esq.
(b)
if
to the
Placement Agent, to:
JMP
Securities LLC
000
Xxxxxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile:
(000)
000-0000
Attention:
Xxx
Xxxxx
cc: Xxxxx
X.
Xxxxxxx,
Esq.
with
a
copy to:
O’Melveny
& Xxxxx LLP
Embarcadero
Center West
000
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000)
000-0000
Attention: Xxxxx
X.
Xxxxx, Esq.
26
(c)
if
to a
Purchaser, at its address as set forth on the Stock Certificate Questionnaire
completed by such Purchaser, or at such other address or addresses as may
have
been furnished to the Company in writing.
Written
confirmation of receipt (A) given by the recipient of such notice, consent,
waiver or other communication, (B) mechanically or electronically generated
by
the sender’s facsimile machine containing the time, date, recipient facsimile
number and an image of the first page of such transmission, or (C) provided
by a
courier or overnight courier service shall be rebuttable evidence of personal
service, receipt by facsimile or receipt from a nationally recognized overnight
delivery service in accordance with clause (i),
(ii)
or
(iii)
above,
respectively.
7.4
Further
Assurances.
Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.
7.5
Expenses.
Except
as provided elsewhere in the Operative Agreements, each party shall bear their
respective costs and expenses associated with the negotiation, execution,
delivery and performance of the Operative Agreements.
7.6
Indemnity.
The
Company shall indemnify, defend and hold harmless each of the Purchasers and
its
agents, shareholders, partners, members, officers, directors, representatives
and affiliates (each an “Purchaser Indemnitee” and collectively, the “Purchaser
Indemnitees”) from and against any and all losses, damages, liabilities, claims
and expenses, including reasonable attorneys’ fees, sustained by any Purchaser
Indemnitee resulting from, arising out of, or connected with any material
inaccuracy in, breach of, or non-fulfillment of any representation, warranty,
covenant or agreement made by or other obligation of the Company contained
in
this Agreement (including the exhibits and schedules hereto) or in any document
delivered in connection herewith.
7.7
Amendments
and Waivers.
This
Agreement may not be modified or amended or the observance of any term of this
Agreement may not be waived except pursuant to an instrument in writing signed
by the Company and each Purchaser. All references in this Agreement to sections,
paragraphs, exhibits and schedules shall, unless otherwise provided, refer
to
sections and paragraphs hereof and exhibits and schedules attached hereto,
all
of which exhibits and schedules are incorporated herein by this reference.
No
consideration shall be offered or paid to any Purchaser to amend or consent
to a
waiver or modification of any provision of any of this Agreement unless the
same
consideration is also offered to all of the Purchasers.
7.8 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.
27
7.9
Severability.
In case
any provision contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of
the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.
7.10
Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York, without regard to conflict of laws provisions.
7.11
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 hereto and delivered to the other parties.
Facsimile signatures shall be deemed original signatures.
7.12
Entire
Agreement.
This
Agreement, the Registration Rights Agreement and the instruments referenced
herein contain the entire understanding of the parties with respect to the
matters covered herein and therein and, except as specifically set forth herein
or therein, neither the Company nor any of the Purchasers makes any
representation, warranty, covenant or undertaking with respect to such
matters.
7.13
Third
Party Beneficiaries.
The
Placement Agent shall be a third party beneficiary of this
Agreement.
7.14
Publicity.
The
Company shall have the right to approve before issuance any press releases
or
any other public statements with respect to the transactions contemplated by
the
Operative Agreements. The Company shall not publicly disclose the name of any
Purchaser or any of its affiliates or investment advisers without the prior
written consent of such Purchaser; provided, however, that the Company shall
have the right to disclose such information without such Purchaser’s consent in
the event that such disclosure is required by any Operative Agreement, judicial
or administrative action, law (including, without limitation, the Securities
Act
and the Exchange Act), any exchange on which securities of the Company are
listed and regulations or as otherwise deemed advisable by counsel to the
Company.
7.15
Termination.
In the
event that the Closing shall not have occurred with respect to a Purchaser
on or
before five (5) business days from the Effective Date due to the Company’s or
such Purchaser’s failure to satisfy the conditions set forth in Sections
5
and
6
of this
Agreement (and the non-breaching party’s failure to waive such unsatisfied
conditions), the non-breaching party shall have the option to terminate this
Agreement with respect to such breaching party at the close of business on
such
date without liability of any non-breaching party to any other party.
7.16
Assignment.
The
terms and conditions to this Agreement shall inure to the benefit of the parties
hereto and their respective permitted successors, heirs, assignees and legal
representatives. This Agreement and the rights and obligations of the respective
Purchasers hereunder may not be assigned without the prior written consent
of
the Company; provided, however, that no such consent shall be required for
any
assignment to (i) a direct or indirect majority-owned subsidiary of such
Purchaser or other entity controlled or managed by the Purchaser, (ii) to any
entity for which such Purchaser or an affiliate of the Purchaser is a general
partner or managing member or (iii) to
any
entity that shares a common discretionary investment advisor with such
Purchaser.
The
Company may not assign its rights hereunder without the prior written consent
of
the Purchasers. In no event will a sale by any Purchaser of all or substantially
all of its capital stock or assets, or a merger, consolidation, share exchange
or other business combination transaction involving any such Purchaser
constitute an assignment for purposes of this Section
7.16.
[Remainder
Of This Page Has Been Intentionally Left Blank]
28
Exhibit
10.1
IN
WITNESS WHEREOF,
the
parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the Effective Date.
|
“COMPANY”
|
||
| NEW YORK MORTGAGE TRUST, INC. | ||
| |
|
|
| By: | ||
|
Name: |
||
| Title: | ||
[SIGNATURE
PAGE TO PURCHASE AGREEMENT]
S-1
Exhibit
10.1
| “PURCHASER” | ||
| |
|
Name of Purchaser:________________________________ Name
of Individual
Representing
Purchaser: __________________________
Title:
__________________________________
Signature:
_______________________________
Number
of Shares:
___________________________________________
Address:
_______________________________
_______________________________
_______________________________
Telephone:
_____________________________
Facsimile:
_____________________________
|
[SIGNATURE
PAGE TO PURCHASE AGREEMENT]
S-2
Exhibit
10.1
SUMMARY
INSTRUCTION SHEET FOR THE PURCHASER
(to
be
read in conjunction with the entire
Purchase
Agreement and the Registration Rights Agreement)
A. Complete
the following items on both Operative Agreements:
1.
Page
S-2
- Signature:
(i)
Name
of
Purchaser
(ii) Name
of
Individual representing Purchaser (if an Institution)
(iii)
Title
of
Individual representing Purchaser (if an Institution)
(iv) Signature
of Individual Purchaser or Individual representing Purchaser
(v) Address,
telephone and facsimile of Purchaser
2.
Appendix
I
- Stock
Certificate Questionnaire (attached to the Purchase Agreement); Registration
Statement Questionnaire (attached to the Registration Rights
Agreement):
Provide
the information requested by the Stock Certificate Questionnaire and
Registration Statement Questionnaire.
3.
Return
BOTH properly completed and signed Operative Agreements (i.e.,
the
Purchase Agreement and the Registration Rights Agreement) including the properly
completed Appendix
I
(initially by facsimile with hard copy by overnight delivery) to:
JMP
Securities LLC
000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile:
(000)
000-0000
Attention:
Xx.
Xxxxx
Xxxxxxxxx
B.
Instructions
regarding the transfer of funds for the purchase of Shares will be sent by
facsimile to the Purchaser by the Placement Agent at a later date.
C.
Upon
the
resale of the Shares by the Purchasers after the Registration Statement covering
the Shares is effective, as described in the Purchase Agreement, the
Purchaser:
(i)
must
deliver a current prospectus of the Company to the buyer (prospectuses must
be
obtained from the Company at the Purchaser’s request); and
(ii)
must
send
a letter in the form of Appendix
II
to the
Company so that the Shares may be properly transferred.
S-3
Exhibit
10.1
APPENDIX
I
NEW
YORK MORTGAGE TRUST, INC.
STOCK
CERTIFICATE QUESTIONNAIRE
The
undersigned purchaser requests that its stock certificate be issued in the
name
of the person(s) indicated below:
|
Name:
___________________________________
|
|||
|
Address:
_________________________________
_________________________________
_________________________________
|
|||
|
Social
Security or
other
Taxpayer Identification Number: _______________________
|
|||
|
Date:
____________________________________
Name
of Purchaser: _________________________
Name
of Individual
Representing
Purchaser: _____________________
Title:
____________________________________
Signature: ________________________________
|
Appendix
I - 1
Exhibit
10.1
APPENDIX
II
NEW
YORK MORTGAGE TRUST, INC.
PURCHASER’S
CERTIFICATE OF SUBSEQUENT SALE
Attention: New
York
Mortgage Trust, Inc.
Chief
Financial Officer
The
undersigned, [an officer of, or other person duly authorized by]
____________________________________________________________________ [fill
in
official name of individual or institution] hereby certifies that he/she [said
institution] is the Purchaser of the shares evidenced by the attached
certificate, and as such, sold [fill in number] shares on
__________________.
| Print or Type: |
Name
of Purchaser:_____________________________________
Name
of Individual
Representing
Purchaser: _________________________________
Title: _______________________________________________
Signature:
___________________________________________
|
|
Exhibit
C
- 1
