EXHIBIT 10.1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this "Agreement") is dated as of June
22, 2006, by and between Rockwell Medical Technologies, Inc., a Michigan
corporation (the "Company") and Emerald Asset Advisors, LLC, a limited liability
company organized under the laws of the state of Delaware (the "Purchaser").
WHEREAS, subject to the terms and conditions set forth in this Agreement
and pursuant to Section 4(2) of the Securities Act (as defined below) and Rule
506 promulgated thereunder, the Company desires to issue and sell to the
Purchaser, and the Purchaser desires to purchase from the Company 111,895 shares
of the Company's Common Stock, as more fully described in this Agreement.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchaser agree
as follows:
ARTICLE I.
DEFINITIONS
1.1 Definitions. In addition to the terms defined elsewhere in this
Agreement, for all purposes of this Agreement, the following terms shall have
the meanings indicated in this Section 1.1:
"Affiliate" means any Person that, directly or indirectly through one
or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 144. With
respect to Purchaser, any investment fund or managed account that is managed on
a discretionary basis by the same investment manager as Purchaser will be deemed
to be an Affiliate of Purchaser.
"Business Day" means any day except Saturday, Sunday and any day which
shall be a federal legal holiday or a day on which banking institutions in the
State of New York are authorized or required by law or other governmental action
to close.
"Closing" means the closing of the purchase and sale of the Shares
pursuant to Section 2.
"Closing Date" means the date of the Closing.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the common shares of the Company, no par value
per share, and any securities into which such common stock may hereafter be
reclassified.
"Company Counsel" for the transactions contemplated by this Agreement
means Xxxxxxxx Xxxxxx Xxxxxxxx & Xxxx LLP.
"Effective Date" means the date that the Registration Statement is
first declared effective by the Commission.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Investment Amount" means $500,000.00.
"Lien" means any lien, charge, encumbrance, security interest, right
of first refusal or other restrictions of any kind, but excluding any
restriction imposed under applicable securities laws.
"Person" means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof)
or other entity of any kind.
"Proceeding" means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
"Registration Statement" means a registration statement meeting the
requirements set forth in the Registration Rights Agreement and covering the
resale by the Purchaser of the Shares.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date of this Agreement, between the Company and the
Purchaser, in the form of Exhibit A hereto.
"Rule 144" means Rule 144 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Securities" means the Shares.
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means the 111,895 shares of Common Stock issued to Purchaser
at the Closing pursuant to this Agreement.
"Subsidiary" means any subsidiary of the Company that would be
required to be listed in an exhibit to the Company's Annual Report on Form
10-KSB covering the period in which the date of this Agreement falls.
"Trading Day" means a day on which the Common Stock is traded on a
Trading Market.
"Trading Market" means the following markets or exchanges on which the
Common Stock is listed or quoted for trading on the date in question: the NASDAQ
Capital
2
Market, the Nasdaq National Market, the American Stock Exchange, the New York
Stock Exchange or the OTC Bulletin Board.
"Transaction Documents" means this Agreement, the Registration Rights
Agreement and any other documents or agreements executed in connection with the
transactions contemplated hereunder.
ARTICLE II.
PURCHASE AND SALE
2.1 Closing. Subject to the terms and conditions set forth in this
Agreement, at the Closing the Company shall issue and sell to Purchaser, and
Purchaser shall purchase from the Company, the Shares and pay to the Company the
Purchaser's Investment Amount. The Closing shall take place at the offices of
Emerald Asset Advisors, LLC, 000 Xxxxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000
within two (2) Business Days after the date this Agreement is executed and
delivered by the parties or at such other location or time as the parties may
agree.
2.2 Closing Deliveries. (a) At the Closing, the Company shall deliver or
cause to be delivered to Purchaser the following:
(i) a certificate, registered in the name of Purchaser evidencing
the Shares;
(ii) the Registration Rights Agreement duly executed by the
Company; and
(iii) the legal opinion of Company Counsel, in the form attached
hereto as Exhibit B, addressed to the Purchaser.
(b) At the Closing, Purchaser shall deliver or cause to be delivered
to the Company the following:
(i) the Investment Amount, in United States dollars and in
immediately available funds, by wire transfer to an account designated in
writing by the Company for such purpose; and
(ii) the Registration Rights Agreement duly executed by
Purchaser.
2.3 Closing Conditions. (a) The obligations of the Company hereunder in
connection with the Closing are subject to the following conditions being met:
(i) the accuracy in all material respects when made and on the
Closing Date of the representations and warranties of Purchaser contained
herein;
(ii) all obligations, covenants and agreements of the Purchaser
required to be performed at or prior to the Closing Date shall have been
performed; and
3
(iii) the delivery by the Purchaser of the items set forth in
Section 2.2(b) of this Agreement.
(b) the obligations of the Purchaser hereunder in connection with the
Closing are subject to the following conditions being met:
(i) the accuracy in all material respects when made and on the
Closing Date of the representations and warranties of the Company contained
herein;
(ii) all obligations, covenants and agreements of the Company
required to be performed at or prior to the Closing Date shall have been
performed;
(iii) the delivery by the Company of the items set forth in
Section 2.2(a) of this Agreement;
(iv) there shall have been no Material Adverse Effect (as
hereinafter defined) with respect to the Company since the date hereof; and
(v) from the date hereof to the Closing Date, trading in the
Common Stock shall not have been suspended by the Commission (except for
any suspension of trading of limited duration agreed to by the Company,
which suspension shall be terminated prior to the Closing), and, at any
time prior to the Closing Date, trading in securities generally as reported
by Bloomberg Financial Markets shall not have been suspended or limited, or
minimum prices shall not have been established on securities whose trades
are reported by such service, or on any Trading Market, nor shall a banking
moratorium have been declared either by the United States or New York State
authorities nor shall there have occurred any material outbreak or
escalation of hostilities or other national or international calamity of
such magnitude in its effect on, or any material adverse change in, any
financial market which, in each case, in the reasonable judgment of each
Purchaser, makes it impracticable or inadvisable to purchase the Shares at
the Closing.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
The Company makes the representations and warranties to the Purchaser set
forth in this Article III, subject to information set forth in the Disclosure
Materials (as defined in Section 3.1(g)). The disclosure set forth in the
Disclosure Materials shall qualify each section in this Article III where such
information is applicable.
3.1 Representations and Warranties of the Company. The Company hereby makes
the following representations and warranties to Purchaser:
(a) Organization and Qualification. Each of the Company and each
Subsidiary is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization (as applicable),
4
with the requisite corporate power and authority to own and use its properties
and assets and to carry on its business as currently conducted.
(b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and to consummate the transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations thereunder. The execution and delivery of each of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary corporate action
on the part of the Company and no further action is required by the Company in
connection therewith. Each Transaction Document has been (or upon delivery will
have been) duly executed by the Company and, when delivered in accordance with
the terms hereof, will constitute the valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship, receivership or
similar laws relating to, or affecting generally the enforcement of, creditors'
rights and remedies or by other equitable principles.
(c) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated thereby do not and will not (i) conflict with or
violate any provision of the Company's or any Subsidiary's certificate or
articles of incorporation, bylaws or other organizational or charter documents,
or (ii) conflict with, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) to which the
Company or any Subsidiary is a party or by which any property or asset of the
Company or any Subsidiary is bound or affected; except such as would not,
individually or in the aggregate, have or reasonably be expected to result in a
Material Adverse Effect.
(d) Issuance of the Securities. The Securities have been duly
authorized and, when issued and paid for in accordance with the Transaction
Documents, will be validly issued, fully paid and nonassessable, free and clear
of all Liens. The Company has reserved from its duly authorized capital stock
the maximum number of shares of Common Stock issuable pursuant to this
Agreement.
(e) SEC Reports; Financial Statements. Except as set forth in Schedule
3.1(e), the Company has filed all reports required to be filed by it under the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof (or such
shorter period as the Company was required by law to file such reports) (the
foregoing materials being collectively referred to herein as the "SEC Reports"
and, together with the Schedules to this Agreement, the "Disclosure Materials"),
and for the twelve months preceding the date hereof, such reports have been
filed on a timely basis or the Company has received a valid extension of such
time of filing and has filed any such SEC Reports prior to the expiration of any
such extension.
(f) Material Changes. Since the date of the latest balance sheet
included within the SEC Reports, except as specifically disclosed in the
Disclosure Materials, to the
5
Company's knowledge (i) there has been no event, occurrence or development that
has had or that could reasonably be expected to result in a Material Adverse
Effect, (ii) the Company has not incurred any material liabilities (contingent
or otherwise) other than (A) trade payables and accrued expenses incurred in the
ordinary course of business consistent with past practice and (B) liabilities
not required to be reflected in the Company's financial statements pursuant to
GAAP or required to be disclosed in filings made with the Commission, (iii) the
Company has not materially altered its method of accounting or the identity of
its auditors, (iv) the Company has not declared or made any dividend or
distribution of cash or other property to its stockholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital
stock, and (v) the Company has not issued any equity securities to any officer,
director or Affiliate, except pursuant to existing Company equity compensation
plans. The Company does not have pending before the Commission any request for
confidential treatment of information.
(g) Certain Fees. No brokerage or finder's fees or commissions are or
will be payable by the Company to any broker, financial advisor or consultant,
finder, placement agent, investment banker, bank or other Person with respect to
the transactions contemplated by this Agreement. Purchaser shall have no
obligation with respect to any fees or with respect to any claims (other than
such fees or commissions owed by Purchaser pursuant to written agreements
executed by Purchaser which fees or commissions shall be the sole responsibility
of Purchaser) made by or on behalf of other Persons for fees of a type
contemplated in this Section that may be due in connection with the transactions
contemplated by this Agreement.
(h) Listing and Maintenance Requirements. The Company is and to the
best of its knowledge, upon the issuance of the Securities hereunder and in the
foreseeable future will continue to be, in compliance with the listing and
maintenance requirements for continued listing of the Common Stock on the NASDAQ
Capital Market. The issuance of the Securities hereunder does not contravene the
rules and regulations of the NASDAQ Capital Market. The Company has not, in the
12 months preceding the date hereof, received notice from any Trading Market on
which the Common Stock is or has been listed or quoted to the effect that the
Company is not in compliance with the listing or maintenance requirements of
such Trading Market.
(i) Acknowledgement Regarding Purchaser's Trading Activity. It is
understood and agreed by the Company (i) that, except as otherwise provided
herein, Purchaser has not been asked to agree, nor has Purchaser agreed, to
desist from purchasing or selling, long and/or short, securities of the Company,
or derivative securities based on securities issued by the Company or to hold
the Securities for any specified term; and (ii) that past or future open market
or other transactions by Purchaser, including short sales, and specifically
including, without limitation, short sales or derivative transactions, before or
after the closing of this or future private placement transactions, may
negatively impact the market price of the Company's publicly-traded securities.
The Company further understands and acknowledges that (a) Purchaser may engage
in hedging activities at various times during the period that the Securities are
outstanding, but not before the Securities are registered pursuant to an
effective Registration Statement containing a Plan of Distribution section which
adequately describes such activities and only in compliance with applicable
state and federal law, and (b) such hedging activities (if any) could reduce the
value of the existing stockholders' equity interests in the Company at and
6
after the time that the hedging activities are being conducted. The Company
acknowledges that such aforementioned hedging activities do not constitute a
breach of any of the Transaction Documents. Purchaser agrees not to sell short
or otherwise engage in any transactions involving the Company's securities, or
derivative securities based upon the Company's securities, to the extent any
such transactions would be covered by any Securities at any time such Securities
are not registered pursuant to an effective registration statement, or if such
transaction would in any way be in violation of any applicable law.
(j) Manipulation of Price. The Company has not, and no one acting on
its behalf has, taken, directly or indirectly, any action designed to cause or
to result in the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of any of the Securities in
violation of Regulation M under the Securities Act.
(k) Investment Company. The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
The Purchaser acknowledges and agrees that Company does not make or
has not made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section 3.2.
3.2 Representations and Warranties of the Purchaser. Purchaser hereby
represents and warrants to the Company as follows:
(a) Organization; Authority. Purchaser is an entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization with the requisite corporate, partnership or limited liability
company power and authority to enter into and to consummate the transactions
contemplated by the applicable Transaction Documents and otherwise to carry out
its obligations thereunder. The execution, delivery and performance by Purchaser
of the Transaction Documents to which it is a party and the consummation by
Purchaser of the transactions contemplated by this Agreement have been duly
authorized by all necessary corporate or, if such Purchaser is not a
corporation, such partnership, limited liability company or other applicable
like action, on the part of Purchaser. Each of this Agreement and the
Registration Rights Agreement have been duly executed by Purchaser, and when
delivered by Purchaser in accordance with terms hereof, will constitute the
valid and legally binding obligation of Purchaser, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditors' rights and remedies or by other
equitable principles.
(b) Purchaser Status. At the time Purchaser was offered the
Securities, it was, and at the date hereof it is, an "accredited investor" as
defined in Rule 501(a) under the Securities Act. Purchaser is not a registered
broker-dealer under Section 15 of the Exchange Act.
(c) General Solicitation. Purchaser is not purchasing the Securities
as a result of any advertisement, article, notice or other communication
regarding the Securities published
7
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.
(d) Access to Information. Purchaser acknowledges that it has reviewed
the Disclosure Materials and has been afforded (i) the opportunity to ask such
questions as it has deemed necessary of, and to receive answers from,
representatives of the Company concerning the terms and conditions of the
offering of the Securities and the merits and risks of investing in the
Securities; (ii) access to information about the Company and the Subsidiaries
and their respective financial condition, results of operations, business,
properties, management and prospects sufficient to enable it to evaluate its
investment; and (iii) the opportunity to obtain such additional information that
the Company possesses or can acquire without unreasonable effort or expense that
is necessary to make an informed investment decision with respect to the
investment.
(e) Knowledge and Experience of Purchaser. Purchaser, either alone or
together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of evaluating
the merits and risks of the prospective investment in the Securities, and has so
evaluated the merits and risks of such investment. Purchaser is able to bear the
economic risk of an investment in the Securities and is able to afford a
complete loss of such investment.
(f) Restrictions on Securities. Purchaser understands that the
Securities have not been registered under the Securities Act and may not be
offered, resold, pledged or otherwise transferred except (a) pursuant to an
exemption from registration under the Securities Act or pursuant to an effective
registration statement in compliance with Section 5 under the Securities Act and
(b) in accordance with all applicable securities laws of the states of the
United States and other jurisdictions.
(g) Investment Intent. Purchaser is acquiring the Securities as
principal for its own account for investment purposes only and not with a view
to or for distributing or reselling such Securities or any part thereof, without
prejudice, however, to Purchaser's right at all times to sell or otherwise
dispose of all or any part of such Securities in compliance with applicable
federal and state securities laws. Nothing contained herein shall be deemed a
representation or warranty by Purchaser to hold the Securities for any period of
time. Purchaser is acquiring the Securities hereunder in the ordinary course of
its business. Purchaser does not have any agreement or understanding, directly
or indirectly, with any Person to distribute any of the Securities.
(h) Investment Decision. Purchaser is not relying on the Company or on
any legal or other opinion in the materials reviewed by the Purchaser with
respect to the financial or tax considerations of the Purchaser relating to its
investment in the Securities. Purchaser has relied solely on the representations
and warranties, covenants and agreements of the Company in this Agreement
(including the Schedules and Exhibits hereto) and on its examination and
independent investigation in making its decision to acquire the Securities.
(i) No Other Representations. No oral or written representations have
been made to Purchaser by the Company, or any of its officers, directors,
employees, agents, affiliates
8
or subsidiaries of the Company, in connection with its acquisition of Securities
which were in any way inconsistent with the representations contained herein.
Purchaser acknowledges that no representations or warranties of any type or
description have been made to it by any Person with regard to the Company, any
of its Subsidiaries, any of their respective businesses, properties or prospects
or the investment contemplated herein, other than the representations and
warranties set forth in Article III hereof. Purchaser has not been furnished
with any oral representation or oral information in connection with the offering
of the Securities that is not contained in this Agreement or the SEC Reports
(j) No Prior Short Selling. At no time during the 30 days prior to the
Closing Date has Purchaser engaged in or effected, in any manner whatsoever,
directly or indirectly, any sale of Common Stock which Purchaser is not deemed
to own under the provisions of Rule 200(b) of Regulation SHO promulgated under
the Exchange Act.
(k) Compliance with Laws. Purchaser is in compliance with all
securities laws applicable to it in connection with the transactions
contemplated by the Transaction Documents, including all securities laws, rules
and regulations in respect of the stabilization or manipulation of the price of
the Common Stock.
(l) Private Placement. Purchaser understands and acknowledges that (i)
the Securities are offered and sold without registration under the Securities
Act in a private placement that is exempt from the registration provisions of
the Securities Act and (ii) the availability of such exemption depends in part
on, and that the Company and its counsel will rely upon, the accuracy and
truthfulness of the foregoing representations and Purchaser hereby consents to
such reliance.
(m) Registration Statement Questionnaire. Purchaser has completed or
caused to be completed the Selling Securityholder Notice and Questionnaire
attached to the Registration Rights Agreement as Annex B, for use in preparation
of the Registration Statement, and the answers thereto are true and correct as
of the date hereof and will be true and correct as of the effective date of the
Registration Statement, or as applicable, any amendment thereto, and Purchaser
will notify the Company immediately of any material change in any such
information provided in the Selling Securityholder Notice and Questionnaire
until such time as the Registration Statement has been declared effective.
(n) Commissions. Purchaser has not incurred any obligation for any
finder's or broker's or agent's fees or commissions in connection with the
transactions contemplated hereby.
(o) Purchaser acknowledges that it will execute and deliver to the
Company the Selling Securityholder Notice and Questionnaire attached as Annex B
to the Registration Rights Agreement in connection with the filing of the
Registration Statement, prior to the filing thereof.
The Company acknowledges and agrees that Purchaser does not make and
has not made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section 3.2.
9
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 (a) Securities may only be disposed of in compliance with state and
federal securities laws. In connection with any transfer of the Securities other
than pursuant to an effective registration statement, to the Company, to an
Affiliate of a Purchaser or in connection with a pledge as contemplated in
Section 4.1(b), the Company may require the transferor thereof to provide to the
Company an opinion of counsel selected by the transferor and reasonably
acceptable to the Company, the form and substance of which opinion shall be
reasonably satisfactory to the Company, to the effect that such transfer does
not require registration of such transferred Securities under the Securities
Act.
(b) Certificates evidencing the Shares will contain the following
legend, so long as is required by this Section 4.1(b):
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR THE SECURITIES
STATUTES OF ANY STATE OR JURISDICTION (COLLECTIVELY, THE "SECURITIES
ACTS"). THE SHARES ARE RESTRICTED SECURITIES AND MAY NOT BE PLEDGED,
HYPOTHECATED, SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SHARES UNDER THE SECURITIES ACTS OR AN
OPINION OF COUNSEL, SATISFACTORY TO THE CORPORATION, THAT REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACTS.
The Company acknowledges and agrees that while a registration statement is
effective under the Securities Act with respect to the Securities, Purchaser may
from time to time pledge Securities pursuant to a bona fide margin account and,
if required under the terms of such account, Purchaser may transfer pledged or
secured Securities to the pledgees or secured parties while a registration
statement is effective under the Securities Act with respect to the Securities.
Such pledge or transfer would not be subject to approval or consent of the
Company and no legal opinion of legal counsel to the pledgee, secured party or
pledgor shall be required in connection with the pledge. Further, no notice
shall be required of such pledge, but the legend shall remain on the pledged
Securities. At Purchaser's expense, the Company will execute and deliver such
reasonable documentation as a pledgee or secured party of Securities may
reasonably request in connection with a pledge or transfer of the Securities
including the preparation and filing of any required prospectus supplement under
Rule 424(b)(3) of the Securities Act or other applicable provision of the
Securities Act to appropriately amend the list of Selling Stockholders
thereunder.
(c) Certificates evidencing the Shares shall not be required to
contain any legend (including the legend set forth in Section 4.1(b)): (i) while
a registration statement (including the Registration Statement) covering the
resale of such Shares is effective under the Securities Act, or (ii) following
any sale of such Shares pursuant to and in compliance with Rule 144, or (iii) if
such Shares are eligible for sale under Rule 144(k). Upon satisfaction of the
conditions specified in the preceding sentence and receipt of any opinion
requested by the
10
Company pursuant to Section 4.1(a), the Company shall cause its counsel to issue
the legal opinion to the Company's transfer agent promptly if requested by the
Company's transfer agent to effect the removal of the legend hereunder.
Following the Effective Date and while a registration statement is effective
under the Securities Act with respect to the Shares, or at such earlier time as
a legend is no longer required for the Shares under this Section 4.1(c), the
Company will, no later than three (3) Trading Days following the delivery by
Purchaser to the Company's transfer agent of a certificate representing Shares
containing a restrictive legend together with any required certificates or
opinions ("Legend Removal Date"), deliver or cause to be delivered to Purchaser
a certificate representing such Shares that is free from all restrictive and
other legends. The Company may not make any notation on its records or give
instructions to any transfer agent of the Company that enlarge the restrictions
on transfer set forth in this Section except to the extent required under
applicable law. Certificates for Securities subject to legend removal hereunder
shall be transmitted by the transfer agent of the Company to the Purchaser by
crediting the account of the Purchaser's prime broker with the Depository Trust
Company System.
(d) In addition to Purchaser's other available remedies, the Company
shall pay to Purchaser, in cash, as partial liquidated damages and not as a
penalty, for each $1,000 of Shares (based on the closing price of the Common
Stock on the date such Securities are submitted to the Company's transfer agent)
delivered for removal of the restrictive legend and subject to Section 4.1(c),
$10 per Trading Day (increasing to $20 per Trading Day five (5) Trading Days
after such damages have begun to accrue) for each Trading Day after the Legend
Removal Date until such certificate is delivered without a legend; provided that
in no event shall the amount required to be paid by the Company under this
Section exceed the actual damages suffered by the Purchaser resulting from the
failure to deliver certificates free of restrictive legends as required by this
Agreement, measured as the amount by which the value of the Securities held by
Purchaser on the Legend Removal Date exceeded the highest aggregate value of
such Securities on any day commencing on the Legend Removal Date through and
including the date the Securities are actually disposed of by Purchaser. For
purposes hereof the "value" of the Securities held by Purchaser shall be
determined by multiplying the number of Securities held by Purchaser by the
highest sale price per share of the Company's common stock. Nothing herein shall
limit Purchaser's right to pursue actual damages for the Company's failure to
deliver certificates representing any Securities as required by the Transaction
Documents in lieu of the penalties provided herein, and Purchaser shall have the
right to pursue all remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief.
4.2 Furnishing of Information. As long as Purchaser owns the Securities,
the Company covenants to use its commercially reasonable efforts to timely file
(or obtain extensions in respect thereof and file within the applicable grace
period) all reports required to be filed by the Company after the date hereof
pursuant to the Exchange Act which are required to be filed in order to satisfy
the current public information requirements of Rule 144(c)(1). As long as
Purchaser owns Securities, if the Company is no longer subject to the periodic
reporting requirements of the Exchange Act and Rule 144(k) is not available to
Purchaser with respect to any Securities held, the Company will prepare and
furnish to the Purchaser and make publicly
11
available in accordance with Rule 144(c)(2) such information as is required for
the Purchaser to sell the Shares under Rule 144.
4.3 Securities Laws Disclosure; Publicity. The Company shall file a Current
Report on Form 8-K disclosing the material terms of the transaction and shall
attach the Transaction Documents thereto on or before 5:30 p.m. Eastern Daylight
Saving time on the Trading Day following the date hereof. In addition, the
Company will make such other filings and notices in the manner and time required
by the Commission and the Trading Market on which the Common Stock is listed.
The Company shall not include in any press release relating to the sale of
Shares to the Purchaser, the name of Purchaser, without the consent of
Purchaser. Nothing herein shall be deemed to preclude the disclosure of the name
of Purchaser in the Company's filings with the Commission or to any Trading
Market, or to the extent required by applicable law.
4.4 Integration. The Company shall not sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the Securities in a manner that would require the registration under the
Securities Act of the sale of the Securities to the Purchaser or that would be
integrated with the offer or sale of the Securities for purposes of the rules
and regulations of any Trading Market such that it would require stockholder
approval of the sale of the Securities to the Purchaser unless stockholder
approval is obtained before the closing of such subsequent transaction.
4.5 Stockholder Rights Plan. No claim will be made or enforced by the
Company that Purchaser is an "Acquiring Person" under any stockholder rights
plan or similar plan or arrangement in effect or hereafter adopted by the
Company, or that Purchaser could be deemed to trigger the provisions of any such
plan or arrangement, by virtue of receiving Securities under the Transaction
Documents. The Company shall conduct its business in a manner so that it will
not become subject to the Investment Company Act.
4.6 Non-Public Information. The Company covenants and agrees that neither
it nor any other Person acting on its behalf will provide Purchaser or its
agents or counsel with any information that the Company believes constitutes
material non-public information, unless prior thereto Purchaser shall have
executed a written agreement regarding the confidentiality and use of such
information. The Company understands and confirms that Purchaser shall be
relying on the foregoing representations in effecting transactions in securities
of the Company. The Purchaser agrees not to effect transactions in any
securities of the Company while in the possession of material non-public
information regarding the Company.
4.7 Reservation of Common Stock. As of the date hereof, the Company has
reserved and the Company shall continue to reserve and keep available at all
times prior to the Closing, free of preemptive rights, a sufficient number of
shares of Common Stock for the purpose of enabling the Company to issue Shares
pursuant to this Agreement.
4.8 Listing of Common Stock. The Company hereby agrees to use commercially
reasonable efforts to maintain the listing of the Common Stock on a Trading
Market, and as soon as reasonably practicable following the Closing (but not
later than the earlier of the Effective Date and the first anniversary of the
Closing Date) to list all of the Shares on such Trading
12
Market, if applicable. The Company further agrees, if the Company applies to
have the Common Stock traded on any other Trading Market, it will include in
such application all of the Shares and will take such other action as is
necessary to cause all of the Shares to be listed on such other Trading Market
as promptly as possible. The Company will take all action reasonably necessary
to continue the listing and trading of its Common Stock on a Trading Market and
will comply in all material respects with the Company's reporting, filing and
other obligations under the bylaws or rules of the Trading Market.
4.9 Short Sales and Confidentiality After The Date Hereof. Purchaser has
not directly or indirectly, nor has any Person acting on behalf of or pursuant
to any understanding with Purchaser, engaged in any transactions in the
securities of the Company (including, without limitations, any Short Sales
involving the Company's securities) since the time that Purchaser and the
Company first began discussions regarding an investment in the Company.
Purchaser covenants that neither it nor any Person acting on its behalf or
pursuant to any understanding with it will engage in any transactions in the
securities of the Company (including Short Sales) prior to the time that the
transactions contemplated by this Agreement are closed and publicly disclosed by
the Company. Purchaser has maintained, and covenants that until such time as the
transactions contemplated by this Agreement are closed and publicly disclosed by
the Company, Purchaser will maintain, the confidentiality of all disclosures
made to it in connection with this transaction (including the existence and
terms of this transaction). Notwithstanding the foregoing, Purchaser makes no
representation, warranty or covenant that it will not engage in Short Sales in
the securities of the Company after the time that the transactions contemplated
by this Agreement are closed and first publicly announced as described in
Section 4.3 to the extent permitted by applicable rules; provided that neither
the Purchaser nor any other person acquiring the Shares from the Purchaser will
engage in any Short Sales in violation of the Securities Act, the regulations
promulgated thereunder or any other applicable laws.
ARTICLE V.
MISCELLANEOUS
5.1 Reimbursement of Legal Fees. At the Closing, the Company shall
reimburse Purchaser an aggregate of $40,000 for its legal fees incurred in
connection with its counsel's preparation and negotiation of the Transaction
Documents. The Company shall pay all transfer agent fees, stamp taxes and other
taxes and duties levied in connection with the issuance of the Securities.
5.2 Entire Agreement. The Transaction Documents, together with the Exhibits
and Schedules thereto, contain the entire understanding of the parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.
5.3 Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of (a) the date of transmission, if
such notice or
13
communication is delivered via facsimile at the facsimile number specified in
this Section prior to 6:30 p.m. (New York City time) on a Trading Day, (b) the
next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number specified in this Section on
a day that is not a Trading Day or later than 6:30 p.m. (New York City time) on
any Trading Day, (c) the Trading Day following the date of mailing, if sent by
U.S. nationally recognized overnight courier service, or (d) upon actual receipt
by the party to whom such notice is required to be given. The address for such
notices and communications shall be as follows:
If to the Company: Rockwell Medical Technologies, Inc.
00000 Xxxxx Xxxxx Xxxx
Xxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx, CEO
Facsimile No.: (248)
With a copy to: Xxxxxxxx Xxxxxx Xxxxxxxx & Xxxx LLP
0000 Xxxxx Xxxxxxxx Xxxxxxxx
Xxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxx, Esq.
Facsimile No.: (000) 000-0000
If to Purchaser: Emerald Asset Advisors LLC
000 Xxxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxx, Managing Member
Facsimile No.: (000) 000-0000
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
5.4 Amendments; Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed, in the case of an amendment, by
the Company and Purchaser or, in the case of a waiver, by the party against whom
enforcement of any such waiver is sought. No waiver of any default with respect
to any provision, condition or requirement of this Agreement shall be deemed to
be a continuing waiver in the future or a waiver of any subsequent default or a
waiver of any other provision, condition or requirement hereof, nor shall any
delay or omission of either party to exercise any right hereunder in any manner
impair the exercise of any such right.
5.5 Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party. This Agreement
shall be construed as if drafted jointly by the parties, and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of this Agreement or any of the Transaction
Documents.
5.6 Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties and their successors and permitted assigns. The
parties may not assign this
14
Agreement or any rights or obligations hereunder without the prior written
consent of the other party.
5.7 No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.4.
5.8 Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. Each party
agrees that all Proceedings concerning the interpretations, enforcement and
defense of the transactions contemplated by this Agreement and any other
Transaction Documents (whether brought against a party hereto or its respective
Affiliates, employees or agents) shall be commenced exclusively in the state and
federal courts sitting in the City of New York, Borough of Manhattan (the "New
York Courts"). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein (including with respect to the enforcement of the any of the
Transaction Documents), and hereby irrevocably waives, and agrees not to assert
in any Proceeding, any claim that it is not personally subject to the
jurisdiction of any such New York Court, or that such Proceeding has been
commenced in an improper or inconvenient forum. Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such Proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby. If either party shall
commence a Proceeding to enforce any provisions of a Transaction Document, then
the prevailing party in such Proceeding shall be reimbursed by the other party
for its attorney's fees and other costs and expenses actually incurred with the
investigation, preparation and prosecution of such Proceeding.
5.9 Survival. The representations, warranties, agreements and covenants
contained herein shall survive the Closing for a period of one year after which
time they will terminate.
5.10 Execution. This Agreement may be executed in one or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile or electronic transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile or electronic
signature page were an original thereof.
15
5.11 Severability. If any provision of this Agreement is held to be invalid
or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.
5.12 Replacement of Securities. If any certificate or instrument evidencing
any Securities is mutilated, lost, stolen or destroyed, the Company shall issue
or cause to be issued in exchange and substitution for and upon cancellation
thereof, or in lieu of and substitution therefor, a new certificate or
instrument, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and customary and reasonable
indemnity, if requested. The applicants for a new certificate or instrument
under such circumstances shall also pay any reasonable third-party costs
associated with the issuance of such replacement Securities. If a replacement
certificate or instrument evidencing any Securities is requested due to a
mutilation thereof, the Company may require delivery of such mutilated
certificate or instrument as a condition precedent to any issuance of a
replacement.
5.13 Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, the Purchaser
and the Company will be entitled to specific performance under the Transaction
Documents. The parties agree that monetary damages may not be adequate
compensation for any loss incurred by reason of any breach of obligations
described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law
would be adequate. In the event the Closing does not occur for any reason,
Purchaser's sole remedy against the Company for breach of this Agreement by the
Company shall be the recovery of Purchaser's actual expenses incurred in
connection with this Agreement and the transactions contemplated hereunder.
5.14 Rescission and Withdrawal Right. Notwithstanding anything to the
contrary contained in (and without limiting any similar provisions of) the
Transaction Documents, whenever Purchaser exercises a right, election, demand or
option under a Transaction Document and the Company does not timely perform its
related obligations within the periods therein provided, then Purchaser may
rescind or withdraw, in its sole discretion from time to time upon written
notice to the Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and rights; provided that such
rescission or withdrawal occurs prior to performance by the Company.
5.15 Termination. This Agreement may be terminated by either party by
written notice to the other party if the Closing has not been consummated by the
end of the second Business day following the date this Agreement is executed;
provided, however, that no such termination will affect the right of any party
to xxx for any breach by the other party (or parties).
16
IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.
ROCKWELL MEDICAL TECHNOLOGIES, INC.
By: /S/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President and Chief Executive
Officer
EMERALD ASSET ADVISORS, LLC
By: /S/ Xxxxxxx Xxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Managing Member
17
EXHIBIT A
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of June 22, 2006, by and between Rockwell Medical Technologies,
Inc., a Michigan corporation (the "Company") and Emerald Asset Advisors, LLC, a
limited liability company organized under the laws of the state of Delaware (the
"Purchaser").
This Agreement is made pursuant to the Securities Purchase Agreement,
dated as of the date hereof between the Company and the Purchaser (the "Purchase
Agreement").
The Company and the Purchaser hereby agree as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein
that are defined in the Purchase Agreement shall have the meanings given such
terms in the Purchase Agreement. As used in this Agreement, the following terms
shall have the following meanings:
"Advice" shall have the meaning set forth in Section 6(d).
"Effectiveness Period" shall have the meaning set forth in Section
2(a).
"Event" shall have the meaning set forth in Section 2(b).
"Event Date" shall have the meaning set forth in Section 2(b).
"Filing Date" means, with respect to the Registration Statement
required to be filed hereunder, on or before the 60th day following the
Closing Date.
"Holder" or "Holders" means the holder or holders, as the case may be,
from time to time of Registrable Securities.
"Indemnified Party" shall have the meaning set forth in Section 5(c).
"Indemnifying Party" shall have the meaning set forth in Section 5(c).
"Losses" shall have the meaning set forth in Section 5(a).
"Plan of Distribution" shall have the meaning set forth in Section
2(a).
"Proceeding" means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
"Prospectus" means the prospectus included in the Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A promulgated
under the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the
Registrable Securities covered by the Registration Statement, and all other
amendments
1
and supplements to the Prospectus, including post-effective amendments, and
all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.
"Registrable Securities" means all of the Shares, together with any
shares of Common Stock issued or issuable upon any stock split, dividend or
other distribution, recapitalization or similar event with respect to the
Shares, but only a period of 12 months following the Closing Date.
"Registration Statement" means the registration statements required to
be filed hereunder, including (in each case) the Prospectus, amendments and
supplements to the registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material
incorporated by reference or deemed to be incorporated by reference in the
registration statement.
"Rule 415" means Rule 415 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same purpose and effect as such Rule.
"Rule 424" means Rule 424 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same purpose and effect as such Rule.
"Selling Shareholder Questionnaire" shall have the meaning set forth
in Section 3(a).
2. Registration.
(a) On or prior to the Filing Date, the Company shall prepare and file
with the Commission the Registration Statement covering the offer and sale of
all of the Registrable Securities with the offer to be made on a continuous
basis pursuant to Rule 415. The Registration Statement required hereunder shall
be on Form S-3 (except if the Company is not then eligible to register for
resale the Registrable Securities on Form S-3 or the SEC otherwise takes the
position that Form S-3 is not the appropriate form for the offer and sale of the
Registrable Securities), in which case the Registration shall be on another
appropriate form in accordance herewith). The Registration Statement required
hereunder shall contain (except if otherwise directed by the Holder and agreed
to by the Company) a description of the Plan of Distribution which will include,
but not necessarily be limited to, the information and substance included in
Annex A attached hereto (the "Plan of Distribution"). Subject to the terms of
this Agreement, the Company shall use its reasonable efforts to cause the
Registration Statement to be declared effective under the Securities Act as
promptly as practical after the filing thereof, and shall use its reasonable
efforts to keep the Registration Statement continuously effective under the
Securities Act until the date when all Registrable Securities covered by the
Registration Statement have been sold or until the date which is the first
anniversary of the date of this Agreement (the "Effectiveness Period"). The
Company shall notify the Holders via facsimile of
2
the effectiveness of the Registration Statement no later than the following
Trading Day that the Company receives notification of the effectiveness from the
Commission.
(b) If: (i) a Registration Statement is not filed on or prior to the
Filing Date (if the Company files a Registration Statement without affording
Holder the opportunity to review and comment on the same as required by Section
3(a), the Company shall not be deemed to have satisfied this clause (i)), or
(ii) the Registration Statement has not been declared effective by the
Commission within ninety (90) days of the Closing Date (or within one hundred
twenty (120) days if the Registration Statement receives a "full review" from
the Commission or (iii) the Company fails to file with the Commission a request
for acceleration in accordance with Rule 461 promulgated under the Securities
Act, within five Trading Days after the date that the Company is notified
(orally or in writing, whichever is earlier) by the Commission that a
Registration Statement will not be "reviewed," or is not subject to further
review, or (iv) prior to the date when such Registration Statement is first
declared effective by the Commission, the Company fails to file a pre-effective
amendment and otherwise respond in writing to comments made by the Commission in
respect of such Registration Statement within 20 calendar days after the receipt
of comments by or notice from the Commission that such amendment is required in
order for a Registration Statement to be declared effective, or (iv) after a
Registration Statement is first declared effective by the Commission, it ceases
for any reason to remain continuously effective as to all Registrable Securities
for which it is required to be effective, or the Holders are not permitted to
utilize the Prospectus therein to resell such Registrable Securities, for in any
such case 20 consecutive calendar days but no more than an aggregate of 60
calendar days during any 12 month period (which need not be consecutive Trading
Days)(any such failure or breach being referred to as an "Event," and for
purposes of clause (i), (ii) or (iv) the date on which such Event occurs, or for
purposes of clause (iii) the date on which such three Trading Day period is
exceeded, or for purposes of clause (iv) the date which such 20 calendar day
period is exceeded, or for purposes of clause (iv) the date on which such 20 or
60 calendar day period, as applicable, is exceeded being referred to as "Event
Date"), then in addition to any other rights the Holders may have hereunder or
under applicable law, then, on each such Event Date and on each monthly
anniversary of each such Event Date (if the applicable Event shall not have been
cured by such date) until the applicable Event is cured, the Company shall pay
to each Holder an amount in cash, as partial liquidated damages and not as a
penalty, equal to 1.0% per month of the aggregate purchase price paid by Holder
pursuant to the Purchase Agreement for any Registrable Securities then held by
Holder (such amount to be prorated for partial months), up to a maximum of 9.0%.
If the Company fails to pay any partial liquidated damages pursuant to this
Section in full within seven days after the date payable, the Company will pay
interest thereon at a rate of 18% per annum (or such lesser maximum amount that
is permitted to be paid by applicable law) to the Holder, accruing daily from
the date such partial liquidated damages are due until such amounts, plus all
such interest thereon, are paid in full.
3. Registration Procedures
In connection with the Company's registration obligations hereunder,
the Company shall:
(a) Not less than five Trading Days prior to the filing of the
Registration Statement or any related Prospectus or any amendment or
supplement thereto (i) furnish
3
to Holder copies of all such documents proposed to be filed (including
documents incorporated or deemed incorporated by reference to the extent
requested by such Person) which documents will be subject to the review of
Holder, and (ii) cause its officers and directors, counsel and independent
certified public accountants to consider such inquiries and comments as may
be made by Holder and its advisors. Holder agrees to furnish to the Company
a completed Questionnaire in the form attached to this Agreement as Annex B
(a "Selling Shareholder Questionnaire") not less than two Trading Days
prior to the Filing Date or by the end of the fourth Trading Day following
the date on which Holder receives draft materials in accordance with this
Section. The Filing Date and 90-day and 120-day periods specified in
Section 2(b)(ii) above shall extended for such period of time as is
reasonably required to respond to and resolve inquiries or objections from
the Holder.
(b) (i) Prepare and file with the Commission such amendments,
including post-effective amendments, to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the
Registration Statement continuously effective as to the applicable
Registrable Securities for the Effectiveness Period and prepare and file
with the Commission such additional Registration Statements in order to
register for resale under the Securities Act all of the Registrable
Securities; (ii) cause the related Prospectus to be amended or supplemented
by any required Prospectus supplement, and as so supplemented or amended to
be filed pursuant to Rule 424; (iii) respond as promptly as reasonably
possible to any comments received from the Commission with respect to the
Registration Statement or any amendment thereto and, as promptly as
reasonably possible, upon request, provide the Holder true and complete
copies of all correspondence from and to the Commission relating to the
Registration Statement; and (iv) comply in all material respects with the
provisions of the Securities Act and the Exchange Act with respect to the
disposition of all Registrable Securities covered by the Registration
Statement during the applicable period in accordance with the intended
methods of disposition by the Holder set forth in the Registration
Statement as so amended or in such Prospectus as so supplemented.
(c) Notify the Holder of Registrable Securities to be sold, as
promptly as reasonably practical and confirm such notice in writing
promptly following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to the Registration Statement is
proposed to be filed; (B) when the Commission notifies the Company whether
there will be a "review" of the Registration Statement and whenever the
Commission comments in writing on the Registration Statement (the Company
shall upon request provide true and complete copies thereof and all written
responses thereto to Holder); and (C) with respect to the Registration
Statement or any post-effective amendment, when the same has become
effective; (ii) of any request by the Commission or any other Federal or
state governmental authority during the period of effectiveness of the
Registration Statement for amendments or supplements to the Registration
Statement or Prospectus or for additional information; (iii) of the
issuance by the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of the
Registration Statement covering any or all of the Registrable Securities or
the initiation of any Proceedings for that purpose; (iv) of the receipt by
the Company of any notification with respect to the suspension of the
qualification or
4
exemption from qualification of any of the Registrable Securities for sale
in any jurisdiction, or the initiation or threatening of any Proceeding for
such purpose; and (v) of the occurrence of any event or passage of time
that makes the financial statements included in the Registration Statement
ineligible for inclusion therein or any statement made in the Registration
Statement or Prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires any revisions to the Registration Statement, Prospectus or other
documents so that, in the case of the Registration Statement or the
Prospectus, as the case may be, it will not contain 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 light of the
circumstances under which they were made, not misleading.
(d) Use reasonable efforts to avoid the issuance of, or, if issued,
obtain the withdrawal of (i) any order suspending the effectiveness of the
Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale
in any jurisdiction, at the earliest practicable moment.
(e) Furnish to Holder, without charge, at least one conformed copy of
the Registration Statement and each amendment thereto, including financial
statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference to the extent requested by such Person,
and all exhibits to the extent requested by such Person (including those
previously furnished or incorporated by reference) promptly after the
filing of such documents with the Commission.
(f) Promptly deliver to Holder, without charge, as many copies of the
Prospectus or Prospectuses and each amendment or supplement thereto as such
Persons may reasonably request in connection with resales by the Holder of
Registrable Securities. Subject to the terms of this Agreement, the Company
hereby consents to the use of such Prospectus and each amendment or
supplement thereto by the selling Holders in connection with the offering
and sale of the Registrable Securities covered by such Prospectus and any
amendment or supplement thereto, except after the giving on any notice
pursuant to Section 3(c).
(g) Prior to any resale of Registrable Securities by Holder, use its
commercially reasonable efforts to register or qualify or cooperate with
the selling Holder in connection with the registration or qualification (or
exemption from the Registration or qualification) of such Registrable
Securities for the resale by the Holder under the securities or Blue Sky
laws of such jurisdictions within the United States as any Holder
reasonably requests in writing (but not more than two such jurisdictions),
to keep the Registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and to do any and all other acts
or things reasonably necessary to enable the disposition in such
jurisdictions of the Registrable Securities covered by the Registration
Statement; provided, that the Company shall not be required to qualify
generally to do business in any jurisdiction where it is not then so
qualified, subject the Company to any material tax in any such jurisdiction
where it is not then so subject or file a general consent to service of
process in any such jurisdiction.
5
(h) If NASDR Rule 2710 requires any broker-dealer to make a filing
prior to executing a sale by a Holder, make an Issuer Filing with the
NASDR, Inc. Corporate Financing Department pursuant to NASDR Rule
2710(b)(10)(A)(i) and use reasonable efforts to respond within five Trading
Days to any comments received from NASDR in connection therewith.
(i) If requested by the Holder, cooperate with the Holder to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be delivered to a transferee pursuant to the
Registration Statement, which certificates shall be free, to the extent
permitted by the Purchase Agreement, of all restrictive legends, and to
enable such Registrable Securities to be in such denominations and
registered in such names as Holder may request.
(j) Upon the occurrence of any event contemplated by Section 3(c)(v),
as promptly as reasonably, possible, prepare a supplement or amendment,
including a post-effective amendment, to the Registration Statement or a
supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, neither the Registration
Statement nor such Prospectus will contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. If the Company
notifies the Holder in accordance with clauses (ii) through (v) of Section
3(c) above to suspend the use of any Prospectus until the requisite changes
to such Prospectus have been made, then the Holder shall suspend use of
such Prospectus. The Company will use its reasonable efforts to ensure that
the use of the Prospectus may be resumed as promptly as is practicable. The
Company shall be entitled to exercise its right under this Section 3(j) to
suspend the availability of a Registration Statement and Prospectus, for a
period not to exceed 90 days (which need not be consecutive days) in any 12
month period.
(k) Comply with all applicable rules and regulations of the
Commission.
(l) The Company may require Holder to furnish to the Company a
certified statement as to the number of shares of Common Stock beneficially
owned by Holder and, if required by the Commission, the person thereof that
has voting and dispositive control over the Shares. During any periods that
the Company is unable to meet its obligations hereunder with respect to the
registration of the Registrable Securities solely because any Holder fails
to furnish such information within three Trading Days of the Company's
request, any liquidated damages that are accruing at such time as to Holder
shall be tolled and any Event that may otherwise occur solely because of
such delay shall be suspended as to Holder until such information is
delivered to the Company.
4. Registration Expenses. All fees and expenses incident to the performance
of or compliance with this Agreement by the Company shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to the
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
6
required to be made with the Trading Market on which the Common Stock is then
listed for trading, (B) in compliance with applicable state securities or Blue
Sky laws reasonably agreed to by the Company in writing (including, without
limitation, fees and disbursements of counsel for the Company in connection with
Blue Sky qualifications or exemptions (in not more than two jurisdictions) of
the Registrable Securities and determination of the eligibility of the
Registrable Securities for investment under the laws of such two jurisdictions
as requested by the Holders), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities and of
printing prospectuses if the printing of prospectuses is reasonably requested by
the holders of a majority of the Registrable Securities included in the
Registration Statement), (iii) messenger, telephone and delivery expenses, (iv)
fees and disbursements of counsel for the Company, (v) Securities Act liability
insurance, if the Company so desires such insurance, and (vi) fees and expenses
of all other Persons retained by the Company in connection with the consummation
of the transactions contemplated by this Agreement. In addition, the Company
shall be responsible for all of its internal expenses incurred in connection
with the consummation of the transactions contemplated by this Agreement
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit and the fees and expenses incurred in connection with the listing of the
Registrable Securities on any securities exchange as required hereunder. In no
event shall the Company be responsible for any broker or similar commissions,
broker costs or expense (including without limitation, any costs or expenses
associated with any necessary Filing with the NASDR, Inc. Corporate Financing
Department pursuant to NASDR Rule 2710(b)(10)(A)(i)), the costs or expenses
associated with any Blue Sky qualifications or exemptions (or the determination
of their application) in more than two jurisdictions, or, except to the extent
specifically provided for in this Agreement, any legal fees or other costs of
the Purchaser.
5. Indemnification
(a) Indemnification by the Company. The Company shall, notwithstanding
any termination of this Agreement, indemnify and hold harmless Holder and
each of its officers, directors, agents and employees, each Person who
controls any Holder (within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act) and the officers, directors, agents and
employees of each such controlling Person, to the fullest extent permitted
by applicable law, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable attorneys'
fees) and expenses (collectively, "Losses"), as incurred, arising out of or
relating to any untrue or alleged untrue statement of a material fact
contained in the Registration Statement, any Prospectus or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of
or relating to any omission or alleged omission of a material fact required
to be stated therein or necessary to make the statements therein (in the
case of any Prospectus or supplement thereto, in light of the circumstances
under which they were made) not misleading, except to the extent, but only
to the extent, that (i) such untrue statements or omissions are based
solely upon information regarding Holder furnished in writing to the
Company by Holder expressly for use therein, or to the extent that such
information relates to Holder or Holder's proposed method of distribution
of Registrable Securities and was reviewed and expressly approved in
writing by Holder expressly for use in the Registration Statement, such
Prospectus or in any amendment or
7
supplement thereto (it being understood that the Holder has approved Annex
A hereto for this purpose) or (ii) in the case of an occurrence of an event
of the type specified in Section 3(c)(ii)-(v), the use by Holder of an
outdated or defective Prospectus after the Company has notified Holder in
writing that the Prospectus is outdated or defective and prior to the
receipt by Holder of the Advice contemplated in Section 6(d). The Company
shall notify the Holder promptly of the institution, threat or assertion of
any Proceeding of which the Company is aware in connection with the
transactions contemplated by this Agreement.
(b) Indemnification by Holder. Holder shall indemnify and hold
harmless the Company, its directors, officers, agents and employees, each
Person who controls the Company (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors,
officers, agents or employees of such controlling Persons, to the fullest
extent permitted by applicable law, from and against all Losses, as
incurred, to the extent arising out of or based solely upon: (x) Holder's
failure to comply with the prospectus delivery requirements of the
Securities Act or (y) any untrue or alleged untrue statement of a material
fact contained in any Registration Statement, any Prospectus or in any
amendment or supplement thereto or in any preliminary prospectus, or
arising out of or relating to any omission or alleged omission of a
material fact required to be stated therein or necessary to make the
statements therein not misleading (i) to the extent, but only to the
extent, that such untrue statement or omission is contained in any
information so furnished in writing by Holder to the Company specifically
for inclusion in the Registration Statement or such Prospectus or (ii) to
the extent that (1) such untrue statements or omissions are based solely
upon information regarding Holder furnished in writing to the Company by
Holder expressly for use therein, or to the extent that such information
relates to Holder or Holder's proposed method of distribution of
Registrable Securities and was reviewed and expressly approved in writing
by Holder expressly for use in the Registration Statement (it being
understood that the Holder has approved Annex A hereto for this purpose),
such Prospectus or in any amendment or supplement thereto or (2) in the
case of an occurrence of an event of the type specified in Section
3(c)(ii)-(v), the use by Holder of an outdated or defective Prospectus
after the Company has notified Holder in writing that the Prospectus is
outdated or defective and prior to the receipt by Holder of the Advice
contemplated in Section 6(d). In no event shall the liability of Holder
hereunder be greater in amount than the dollar amount of the net proceeds
received by Holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party shall promptly notify the
Person from whom indemnity is sought (the "Indemnifying Party") in writing,
and the Indemnifying Party shall have the right to assume the defense
thereof, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of all fees and expenses incurred in
connection with defense thereof; provided, that the failure of any
Indemnified Party to give such notice shall not relieve the Indemnifying
Party of its obligations or liabilities pursuant to this Agreement, except
(and only) to the extent that it shall be finally
8
determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have
prejudiced the Indemnifying Party.
An Indemnified Party shall have the right to employ separate counsel
in any such Proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such
Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed
in writing to pay such fees and expenses; (2) the Indemnifying Party shall
have failed promptly to assume the defense of such Proceeding and to employ
counsel reasonably satisfactory to such Indemnified Party in any such
Proceeding; or (3) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and such Indemnified Party shall reasonably believe that a material
conflict of interest is likely to exist if the same counsel were to
represent such Indemnified Party and the Indemnifying Party (in which case,
if such Indemnified Party notifies the Indemnifying Party in writing that
it elects to employ separate counsel at the expense of the Indemnifying
Party, the Indemnifying Party shall not have the right to assume the
defense thereof and the reasonable fees and expenses of one separate
counsel shall be at the expense of the Indemnifying Party). For purposes of
this Section 5(c), the term "conflict of interest" shall mean that there
are one or more legal defenses available to the Indemnified Party that are
different from or additional to those available to the Indemnifying Party
or such other Indemnified Parties, as applicable, which different or
additional defenses make joint representation inappropriate. The
Indemnifying Party shall not be liable for any settlement of any such
Proceeding effected without its prior written consent, which consent shall
not be unreasonably withheld. No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of
any pending Proceeding in respect of which any Indemnified Party is a
party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter
of such Proceeding.
Subject to the terms of this Agreement, all reasonable fees and
expenses of the Indemnified Party (including reasonable fees and expenses
to the extent incurred in connection with investigating or preparing to
defend such Proceeding in a manner not inconsistent with this Section)
shall be paid to the Indemnified Party, as incurred, within ten Trading
Days of written notice thereof to the Indemnifying Party; provided, that
the Indemnified Party shall promptly reimburse the Indemnifying Party for
that portion of such fees and expenses applicable to such actions for which
such Indemnified Party is not entitled to indemnification hereunder,
determined based upon the relative faults of the parties.
(d) Contribution. If the indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party or insufficient to hold an Indemnified
Party harmless for any Losses, then each Indemnifying Party shall
contribute to the amount paid or payable by such Indemnified Party, in such
proportion as is appropriate to reflect the relative fault of the
Indemnifying Party and Indemnified Party in connection with the actions,
statements or omissions that resulted in such Losses as well as any other
relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among
other things, whether any action in
9
question, including any untrue or alleged untrue statement of a material
fact or omission or alleged omission of a material fact, has been taken or
made by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action, statement or
omission. The amount paid or payable by a party as a result of any Losses
shall be deemed to include, subject to the limitations set forth in this
Agreement, any reasonable attorneys' or other reasonable fees or expenses
incurred by such party in connection with any Proceeding to the extent such
party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section was available to such party in
accordance with its terms.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Section 5(d),
Holder shall not be required to contribute, in the aggregate, any amount in
excess of the amount by which the proceeds actually received by Holder from
the sale of the Registrable Securities subject to the Proceeding exceeds
the amount of any damages that Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission, except in the case of fraud by Holder.
The indemnity and contribution agreements contained in this Section
are in addition to any liability that the Indemnifying Parties may have to
the Indemnified Parties.
6. Miscellaneous
(a) Remedies. In the event of a breach by the Company or by Holder, of
any of their obligations under this Agreement, Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights
granted by law and under this Agreement, including recovery of damages,
will be entitled to specific performance of its rights under this
Agreement. The Company and Holder agree that monetary damages would not
provide adequate compensation for any losses incurred by reason of a breach
by it of any of the provisions of this Agreement and hereby further agrees
that, in the event of any action for specific performance in respect of
such breach, it shall waive the defense that a remedy at law would be
adequate.
(b) No Piggyback on Registrations. Except as set forth on Schedule
6(b) attached hereto, neither the Company nor any of its security holders
(other than the Holder in such capacity pursuant hereto) may include
securities of the Company in a Registration Statement other than the
Registrable Securities. No Person has any right to cause the Company to
effect the registration under the Securities Act of any securities of the
Company. The Company shall not file any other registration statements until
the later to occur of: (i) 30 Trading Days following the date that the
Registration Statement required hereunder is declared effective by the
Commission, or (ii) 90 days following the Closing Date, provided that this
Section 6(b) shall not prohibit the Company from filing amendments to
registration statements already filed or filing a registration statement at
10
any time after the Registration Statement has been continuously effective
for 60 days or the Purchaser has disposed of all Registrable Securities
held by it.
(c) Compliance. Holder covenants and agrees that it will comply with
the prospectus delivery requirements of the Securities Act as applicable to
it in connection with sales of Registrable Securities pursuant to the
Registration Statement.
(d) Discontinued Disposition. Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of
the occurrence of any event of the kind described in Section 3(c), Holder
will forthwith discontinue disposition of such Registrable Securities under
the Registration Statement until Holder's receipt of the copies of the
supplemented Prospectus and/or amended Registration Statement or until it
is advised in writing (the "Advice") by the Company that the use of the
applicable Prospectus may be resumed, and, in either case, has received
copies of any additional or supplemental filings that are incorporated or
deemed to be incorporated by reference in such Prospectus or Registration
Statement. The Company will use its reasonable efforts to ensure that the
use of the Prospectus may be resumed as promptly as is practicable. Except
as otherwise provided in Section 3(j), the Company agrees and acknowledges
that any periods during which the Holder is required to discontinue the
disposition of the Registrable Securities hereunder shall be subject to the
provisions of Section 2(b).
(e) Piggy-Back Registrations. If at any time during the Effectiveness
Period there is not an effective Registration Statement covering all of the
Registrable Securities and the Company shall determine to prepare and file
with the Commission a registration statement relating to an offering for
its own account under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to
be issued solely in connection with any acquisition of any entity or
business or equity securities issuable in connection with the stock option
or other employee benefit plans, then the Company shall send to Purchaser a
written notice of such determination and, if within fifteen days after the
date of such notice, Holders shall so request in writing, the Company shall
include in such registration statement all or any part of such Registrable
Securities Holders request to be registered; provided, however, that (i) if
such registration involves an underwritten offering to the public, all
Holders electing to participate in such offering must sell their
Registrable Securities to the underwriters selected by the Company on the
same terms and conditions as apply to the Company; and (ii) if, at any time
after giving notice of the Company's intention to register any securities
pursuant to this 6(e) and prior to the effective date of the registration
statement filed in connection with such registration, the Company shall
determine for any reason not to register such securities, the Company shall
give written notice to all Holders who have elected to participate in such
offering and, thereupon, shall be relieved of its obligation to register
any Registrable Securities in connection with such registration. If the
managing underwriter of the underwritten offering shall inform the Company
by letter of the underwriter's opinion that the number of Registrable
Securities requested to be included in such registration would, in its
opinion, materially adversely affect such offering, including the price at
which such securities can be sold, and the Company has so advised the
Holders electing to participate
11
in such offering in writing, then the Company shall include in such
registration, to the extent of the number that the Company is so advised
can be sold in (or during the time of) such offering, (i) first, all
securities proposed by the Company to be sold for its own account, then
(ii) to the extent that the number of shares of Common Stock proposed to be
sold by the Company pursuant to this Section 6(e) is less than the number
of shares of Common Stock that the Company has been advised can be sold in
such offering without having the material adverse effect referred to above,
such Registrable Securities requested to be included in such registration
pursuant to this Section 6(d); allocated among the electing Holders pro
rata in accordance with the number shares each such Holder requested by
included in such offering.
(f) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the same shall be in writing and signed by
the Company and Purchaser.
(g) Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be delivered as set
forth in the Purchase Agreement.
(h) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of each of the
parties and shall inure to the benefit of each Holder. The Company may not
assign its rights or obligations hereunder without the prior written
consent of Purchaser. Purchaser may assign its rights hereunder in the
manner and to the Persons as permitted under the Purchase Agreement.
(i) No Inconsistent Agreements. Neither the Company nor any of its
subsidiaries has entered, as of the date hereof, nor shall the Company or
any of its subsidiaries, on or after the date of this Agreement, enter into
any agreement with respect to its securities, that would conflict with or
violate the provisions hereof or of any of the Transaction Documents.
Except as set forth on Schedule 6(i), neither the Company nor any of its
subsidiaries has previously entered into any agreement granting any
registration rights with respect to any of its securities to any Person
that has not been satisfied in full.
(j) Execution and Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to
be an original and, all of which taken together shall constitute one and
the same Agreement. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile
signature were the original thereof.
(k) Governing Law. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be
determined with the provisions of the Purchase Agreement.
12
(l) Cumulative Remedies. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.
(m) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their commercially reasonable efforts to find and
employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of
the parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.
(n) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
*************************
13
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
ROCKWELL MEDICAL TECHNOLOGIES, INC.
By: /S/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President and Chief Executive
Officer
EMERALD ASSET ADVISORS, LLC
By: /S/ Xxxxxxx Xxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Managing Member
ANNEX A
Plan of Distribution
The Selling Stockholders (the "Selling Stockholders") of the common stock
("Common Stock") of Rockwell Medical Technologies, Inc., a Michigan corporation
(the "Company") and any of their pledgees, assignees and successors-in-interest
may, from time to time, sell any or all of their shares of Common Stock on any
stock exchange, market or trading facility on which the shares are traded or in
private transactions. These sales may be at fixed, negotiated or market prices.
The Selling Stockholders may use any one or more of the following methods when
selling shares:
- ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
- block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
- purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
- an exchange distribution in accordance with the rules of the
applicable exchange;
- privately negotiated transactions;
- settlement of short sales entered into after the date of this
prospectus;
- broker-dealers may agree with the Selling Stockholders to sell a
specified number of such shares at a stipulated price per share;
- a combination of any such methods of sale;
- through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise; or
- any other method permitted pursuant to applicable law.
The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under this prospectus.
Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NADSR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.
15
In connection with the sale of the Common Stock or interests therein, the
Selling Stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
Common Stock in the course of hedging the positions they assume. The Selling
Stockholders may also, on or after the date of this Prospectus, sell shares of
the Common Stock short and deliver these securities to close out their short
positions, or loan or pledge the Common Stock to broker-dealers that in turn may
sell these securities. The Selling Stockholders may also enter into option or
other transactions with broker-dealers or other financial institutions or the
creation of one or more derivative securities which require the delivery to such
broker-dealer or other financial institution of shares offered by this
prospectus, which shares such broker-dealer or other financial institution may
resell pursuant to this prospectus (as supplemented or amended to reflect such
transaction).
The Selling Stockholders and any broker-dealers or agents that are involved
in selling the shares may be deemed to be "underwriters" within the meaning of
the Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In no
event shall any broker-dealer receive fees, commissions and markups which, in
the aggregate, would exceed eight percent (8%) of the market price of the Common
Stock.
In the event the Selling Stockholders are deemed to be "underwriters"
within the meaning of the Securities Act with respect to the Common Stock, any
difference between the price at which they purchased the Common Stock and the
market price of the Common Stock could be deemed to be a discount or commission
and such deemed discount or commission could exceed eight percent (8%) of the
market price of the Common Stock.
The Company is required to pay the fees and expenses incurred by the
Company incident to the registration of the shares as well as certain of the
fees and expenses of the Selling Stockholders. The Company has agreed to
indemnify the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act. The Selling
Stockholders have agreed to indemnify the Company against certain losses,
claims, damages and liabilities, including liabilities under the Securities Act
arising out of or relating to any omission or alleged omission of a material
fact required to be stated herein or necessary to make the statements herein not
misleading (i) to the extent, but only to the extent, that such untrue statement
or omission is contained in any information so furnished in writing by Selling
Stockholder to the Company specifically for inclusion herein or (ii) to the
extent that (1) such untrue statements or omissions are based solely upon
information regarding Selling Stockholder furnished in writing to the Company by
Selling Stockholder expressly for use herein.
Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act. In addition, any securities covered by this
prospectus which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather than under this prospectus. Each Selling
Stockholder has advised us that they have not entered into any written or oral
agreements, understandings or arrangements with any underwriter or broker-dealer
regarding the
16
sale of the resale shares. There is no underwriter or coordinating broker acting
in connection with the proposed sale of the resale shares by the Selling
Stockholders.
We agreed to keep this prospectus effective for a period of 60 consecutive
days. The resale shares will be sold only through registered or licensed brokers
or dealers if required under applicable state securities laws. In addition, in
certain states, the resale shares may not be sold unless they have been
registered or qualified for sale in the applicable state or an exemption from
the registration or qualification requirement is available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to the Common Stock for a period of two
business days prior to the commencement of the distribution. In addition, the
Selling Stockholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M, which may
limit the timing of purchases and sales of shares of the Common Stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to
deliver a copy of this prospectus to each purchaser at or prior to the time of
the sale.
[NEED TO ADD DISCLOSURE OF ANY RELATIONSHIP BETWEEN PURCHASER AND COMPANY]
[NEED TO ADD ESTIMATE OF FEES AND EXPENSES TO BE PAID BY THE COMPANY]
17
ANNEX B
ROCKWELL MEDICAL TECHNOLOGIES, INC.
SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE
The undersigned beneficial owner of common stock, no par value per share
(the "Common Stock") of Rockwell Medical Technologies, Inc., a Michigan
corporation (the "Company"), (the "Registrable Securities") understands that the
Company has filed or intends to file with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (the "Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities Act"), of the Registrable Securities, in
accordance with the terms of the Registration Rights Agreement, dated as of June
___, 2006 (the "Registration Rights Agreement"), among the Company and the
Purchaser named therein. A copy of the Registration Rights Agreement is
available from the Company upon request at the address set forth below. All
capitalized terms not otherwise defined herein shall have the meanings ascribed
thereto in the Registration Rights Agreement.
Certain legal consequences arise from being named as a selling
securityholder in the Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Registration
Statement and the related prospectus.
NOTICE
The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby elects to include the Registrable Securities owned
by it and listed below in Item 3 (unless otherwise specified under such Item 3)
in the Registration Statement.
18
The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:
QUESTIONNAIRE
1. NAME.
(a) Full Legal Name of Selling Securityholder
______________________________________________________________________
(b) Full Legal Name of Registered Holder (if not the same as (a) above)
through which Registrable Securities Listed in Item 3 below are held:
______________________________________________________________________
(c) Full Legal Name of Natural Control Person (which means a natural
person who directly you indirectly alone or with others has power to
vote or dispose of the securities covered by the questionnaire):
______________________________________________________________________
2. ADDRESS FOR NOTICES TO SELLING SECURITYHOLDER:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Telephone: _____________________________________________________________________
Fax: ___________________________________________________________________________
Contact Person: ________________________________________________________________
3. BENEFICIAL OWNERSHIP OF REGISTRABLE SECURITIES:
(a) Type and Number of Registrable Securities beneficially owned:
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
19
4. BROKER-DEALER STATUS:
(a) Are you a broker-dealer?
Yes [ ] No [ ]
Note: If yes, the Commission's staff has indicated that you should be
identified as an underwriter in the Registration Statement.
(b) Are you an affiliate of a broker-dealer?
Yes [ ] No [ ]
(c) If you are an affiliate of a broker-dealer, do you certify that you
bought the Registrable Securities in the ordinary course of business,
and at the time of the purchase of the Registrable Securities to be
resold, you had no agreements or understandings, directly or
indirectly, with any person to distribute the Registrable Securities?
Yes [ ] No [ ]
Note: If no, the Commission's staff has indicated that you should be
identified as an underwriter in the Registration Statement.
5. BENEFICIAL OWNERSHIP OF OTHER SECURITIES OF THE COMPANY OWNED BY THE
SELLING SECURITYHOLDER.
Except as set forth below in this Item 5, the undersigned is not the
beneficial or registered owner of any securities of the Company other than
the Registrable Securities listed above in Item 3.
(a) Type and Amount of Other Securities beneficially owned by the Selling
Securityholder:
______________________________________________________________________
______________________________________________________________________
20
6. RELATIONSHIPS WITH THE COMPANY:
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equity holders (owners of 5%
of more of the equity securities of the undersigned) has held any position
or office or has had any other material relationship with the Company (or
its predecessors or affiliates) during the past three years.
State any exceptions here:
___________________________________________________________________________
___________________________________________________________________________
The undersigned agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein that may occur subsequent to the
date hereof at any time while the Registration Statement remains effective.
By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to Items 1 through 6 and the
inclusion of such information in the Registration Statement and the related
prospectus. The undersigned understands that such information will be relied
upon by the Company in connection with the preparation or amendment of the
Registration Statement and the related prospectus.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.
Dated: Beneficial Owner:
------------------- ----------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:
Rockwell Medical Technologies, Inc.
00000 Xxxxx Xxxx
Xxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx, Chief Executive Officer
21
SCHEDULE 6(B)
None.
SCHEDULE 6(I)
None.
EXHIBIT B
FORM OF COMPANY COUNSEL LEGAL OPINION
Based upon and subject to the foregoing, we are of the opinion that:
1. The Company is duly incorporated, validly existing and in good standing
under the laws of the State of Michigan, with the requisite corporate power and
authority to own and use its properties and assets and to carry on its business
as described in the SEC Reports.
2. The Company has the requisite corporate power and authority to enter
into and to comply with its obligations under the terms of each of the
Transaction Documents. The execution and delivery by the Company of each of the
Transaction Documents and the performance by it of such Transaction Documents
have been duly authorized by all necessary corporate action on the part of the
Company. Each of the Transaction Documents has been duly executed and delivered
by the Company and constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as limited
by bankruptcy, reorganization, fraudulent conveyance, insolvency, moratorium, or
other similar laws relating to or affecting the enforcement of creditors rights
generally, and subject to general principles of equity, regardless of whether
considered in a proceeding of law or in equity and except for the
indemnification and contribution provisions of the Transaction Documents, as to
which we express no opinion.
3. To our Actual Knowledge no outstanding shares of Common Stock are
entitled to preemptive rights arising under the Michigan Business Corporation
Act in connection with the purchase and sale of the securities pursuant to the
Purchase Agreement.
4. The Shares have been duly authorized and, when paid for, issued and
delivered in accordance with the terms of the Purchase Agreement will be validly
issued, fully paid and nonassessable.
5. The execution, delivery and performance of the Transaction Documents by
the Company (i) do not violate any provision of its Articles of Incorporation or
Bylaws, (ii) will not constitute a default (or an event which, with notice or
lapse of time or both, would constitute a default) under, or give to others any
rights of termination, acceleration or cancellation of any agreement, indenture
or other written instrument of the Company or a subsidiary thereof that is
attached as an exhibit the most recent SEC Report on Form 10-K or any subsequent
SEC Report on Form 10-Q or Form 8-K, (iii) do not violate any law, rule or
regulation of any governmental authority or regulatory body that, to our Actual
Knowledge, is applicable to the Company where such violation would reasonably be
expected to have a material adverse effect upon the validity, performance or
enforceability of any of the terms of the Transaction Documents applicable to
the Company, except for the indemnification and contribution provisions of the
Transaction Documents, as to which we express no opinion, or (iv) based solely
on a certificate of officers of the Company (the "Certificate"), do not violate
any of the Company's existing obligations under any order, judgment, injunction
or decree of any court or governmental authority naming the Company of which we
have Actual Knowledge.
6. To our Actual Knowledge, without investigation or inquiry, other than as
provided in Section 3.1(d) of the Purchase Agreement, the Company is not
required to obtain any consent, waiver, authorization or order of, or make any
filing or registration with, any court or other federal, state or other
governmental authority for the execution, delivery and performance by the
Company of the Transaction Documents, except such as may be required under the
Securities Act and the related rules and regulations, such as may be required
under the bylaws and rules of the NASD and such as may be required under state
securities or Blue Sky laws.
7. Assuming the accuracy of the representations and warranties of the
Company set forth in Section 3.1 of the Purchase Agreement and of the Purchaser
set forth in Section 3.2 of the Purchase Agreement, the offer, issuance and sale
of the Shares to the Purchaser pursuant to the Purchase Agreement are exempt
from the registration requirements of the Securities Act.
This opinion is furnished to the Purchaser for its benefit in connection
with the transactions described above and may not be relied upon by any other
person or for any other purpose without our prior written consent.
Very truly yours,
-----------------------------------------
2
DISCLOSURE SCHEDULE
This Disclosure Schedule has been prepared in connection with the
Securities Purchase Agreement dated June 22, 2006 (the "AGREEMENT") between
Rockwell Medical Technologies, Inc., a Michigan corporation (the "COMPANY") and
Emerald Asset Advisors, LLC (the "PURCHASER"). Capitalized terms not otherwise
defined in this Disclosure Schedule shall have the same meaning as in the
Agreement.
The disclosure of any matter in this Disclosure Schedule should not be
construed as indicating that such matter is necessarily required to be disclosed
in order for any representation or warranty in the Agreement to be true and
correct in all material respects. Any description of any document included in
this Disclosure Schedule is qualified in all respects by reference to such
document.
20
SCHEDULE 3.1(A)
SUBSIDIARIES
Rockwell Transportation, Inc.
21
SCHEDULE 3.1(E)
SEC REPORTS
A Current Report on Form 8-K filed on April 11, 2006 was filed after the
deadline for such report.
22
