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WARRANT PURCHASE AGREEMENT
Warrants to Purchase
500,000 Shares of the
Common Stock of Boston Biomedica, Inc.
Dated: August 18, 1999
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WARRANT PURCHASE AGREEMENT
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TABLE OF CONTENTS
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ARTICLE 1. DESCRIPTION OF PROPOSED FINANCING..................................1
1.1 Authorization of Warrants..................................................1
1.2 Purchase and Sale of Warrants..............................................1
1.3 Closing....................................................................1
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY......................2
2.1 Organization and Qualification.............................................2
2.2 Capitalization.............................................................2
2.3 Authorization of Transaction...............................................2
2.4 Offerees...................................................................2
2.5 Registration Right.........................................................2
2.6 Compliance with Securities and Exchange Commission Requirements............3
2.7 Brokerage..................................................................3
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF INVESTOR.........................3
3.1 Investment Intent; Accredited Investor; Legends............................3
3.2 Authorization..............................................................4
3.3 Restricted Securities......................................................4
3.4 Brokerage..................................................................4
ARTICLE 4. CONDITIONS OF INVESTOR'S OBLIGATIONS...............................4
4.1 Representations and Warranties.............................................4
4.2 Performance................................................................4
4.3 Consents and Waivers.......................................................5
4.4 Legal Action...............................................................5
ARTICLE 5. AFFIRMATIVE COVENANTS OF THE COMPANY...............................5
5.1 Use of Proceeds............................................................5
5.2 Board of Directors.........................................................5
5.3 Future Commissions.........................................................5
5.4 S-3 Registration...........................................................6
ARTICLE 6. REGISTRATION; PUT OPTION...........................................6
6.1 S-3Registration............................................................6
6.2 Expenses...................................................................7
6.3 Indemnification............................................................7
6.4 Payment of Warrant Exercise Price; Refund of Warrant Exercise Proceeds.....9
6.5 Exclusive Obligation to Register...........................................9
6.6 Put Option.................................................................9
ARTICLE 7. MISCELLANEOUS.....................................................10
7.1 Termination...............................................................10
7.2 Survival of Representations and Covenants.................................11
7.3 Notices...................................................................11
7.4 Publicity and Disclosures; Confidentiality................................12
7.5 Assignment................................................................12
7.6 Entire Agreement..........................................................12
7.7 Amendments and Waivers....................................................12
7.9 Counterparts..............................................................12
7.10 Effect of Table of Contents and Headings.................................12
SIGNATURES
LIST OF EXHIBITS
WARRANT PURCHASE AGREEMENT
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500,000 STOCK PURCHASE WARRANTS
PURCHASE AGREEMENT entered into as of the 18th day of August, 1999 by
and among Boston Biomedica, Inc., a Massachusetts corporation with its principal
place of business at 000 Xxxx Xxxxxx, Xxxx Xxxxxxxxxxx, Xxxxxxxxxxxxx (the
"Company"), and Paradigm Group, L.L.C., an Illinois limited liability company
with its principal place of business at 0000 Xxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx,
Xxxxxxxx 00000 (the "Investor").
WHEREAS, the Company desires to raise additional capital; and
WHEREAS, the Investors are interested in investing in the Company;
NOW, THEREFORE, in consideration of the mutual agreements contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE 1. DESCRIPTION OF PROPOSED FINANCING
1.1 Authorization of Warrants. The Company has authorized or will
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authorize the issuance of: (i) nontransferable stock purchase warrants dated as
of the Closing (hereinafter defined) and evidencing rights to purchase an
aggregate of 400,000 shares of the Company's common stock, $.01 par value per
share (the "Common Stock"), at an exercise price of $4.25 per share in
substantially the form of Exhibit A attached hereto (the "$4.25 Warrants"); and
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(ii) nontransferable stock purchase warrants dated as of the Closing and
evidencing rights to purchase an aggregate of 100,000 shares of the Company's
Common Stock at an exercise price of $5.25 per share in substantially the form
of Exhibit B attached hereto (the "$5.25 Warrants") (the $4.25 Warrants and the
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$5.25 Warrants are collectively referred to herein as the "Warrants"). The
Warrants shall expire six months after the Closing as defined below (the
"Warrant Expiration Date").
1.2 Purchase and Sale of Warrants. Subject to the terms and conditions
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of this Agreement and in reliance upon the representations and warranties
contained herein, the Investor agrees to purchase from the Company, and the
Company agrees to sell to the Investor, at the Closing, the Warrants at an
aggregate purchase price of $50,000 (the "Purchase Price").
1.3 Closing. The Closing of the purchase and sale of the Warrants
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contemplated by this Agreement (herein the "Closing") shall take place at the
offices of Brown, Rudnick, Freed & Gesmer, Xxx Xxxxxxxxx Xxxxxx, Xxxxxx, XX
00000 at 10:00 a.m. on the date of Closing which shall be August 18, 1999 or at
such other time and place as shall be mutually agreed by the Investors and the
Company. At the Closing, the Company shall deliver to the Investor the
Warrants to be issued in the Investor's name against payment of the Purchase
Price therefor by wire transfer of immediately available funds.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
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The Company hereby represents and warrants to the Investor that:
2.1 Organization and Qualification. The Company is a corporation
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organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and has all required corporate power and authority
to own its property, to carry on its business as presently conducted and as it
presently intends to conduct it and to carry out the transactions contemplated
hereby. The copies of the Articles of Incorporation and By-Laws of the Company,
as amended to date, which have been furnished to counsel for the Investor by the
Company are correct and complete.
2.2 Capitalization. The authorized capital stock of the Company
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consists of 20,000,000 shares of Common Stock, $.01 par value, of which
4,770,153 shares are validly issued and outstanding, fully paid and
nonassessable, and 1,000,000 shares of Preferred Stock, $.01 par value, none of
which shares are issued and outstanding. The Company has duly authorized and
reserved for issuance upon exercise of the Warrants a total of 500,000 shares of
Common Stock (the "Shares"), and the Shares of Common Stock issued upon such
exercise will be validly issued and outstanding, fully paid and nonassessable.
2.3 Authorization of Transaction. The execution, delivery and
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performance of this Agreement have been duly authorized by all necessary
corporate or other action of the Company and it is the valid and binding
obligation of the Company, enforceable in accordance with its terms, subject to
general principles of equity and to laws of general application relating to
bankruptcy, insolvency and the relief of debtors. The issuance of the Shares
upon exercise of the Warrants pursuant to the terms of this Agreement shall be
duly and validly authorized, and no further approval or authority of the
stockholders or the directors of the Company will be required for the issuance
and sale of the Shares as contemplated by this Agreement.
2.4 Offerees. Neither the Company nor anyone acting on its behalf has
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within the past six (6) months offered the Warrants for sale to, or solicited
any offers to buy the same from, any person or organization other than the
Investor so as to bring the offer, issuance or sale of the Warrants or the
issuance of Common Stock upon exercise of the Warrants, as contemplated by this
Agreement, within the provisions of Section 5 of the Securities Act of 1933, as
amended (the "Act"). Neither the Company nor anyone acting on its behalf has in
the past or will hereafter sell, offer for sale or solicit offers to buy any of
said securities so as to bring the offer, issuance or sale of the Warrants, or
the issuance of Common Stock upon exercise of the Warrants, as contemplated by
this Agreement, within the provisions of Section 5 of the Act. The Company has
complied and will comply with all applicable state securities laws in connection
with the issuance and sale of the Warrants.
2.5 Registration Rights. Other than such registration rights as are
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granted pursuant to ARTICLE 6 of this Agreement, except as set forth on Schedule
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2.5 hereto, no stockholder,
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noteholder, or any other holder of any security issued by the Company, nor any
holder of rights to acquire any security from the Company, has any right to
require the Company to file, or to join the Company in the filing of, a
registration statement or notification under the Act.
2.6 Compliance with Securities and Exchange Commission Requirements.
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The Company has filed all reports, proxy statements, forms and other documents
(collectively, the "SEC Documents") required to be filed by it with the
Securities and Exchange Commission (the "Commission") under the Act and under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and as of
their respective dates such SEC Documents (i) complied in all material respects
with the requirements of the Act or the Exchange Act, as the case may be, and
the rules and regulations of the Commission promulgated thereunder applicable to
such SEC Documents, and (ii) did not contain at the time of their filing an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.
2.7 Brokerage. Except as set forth on Schedule 2.7 hereto, there are no
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valid claims for brokerage commissions, finder's fees or similar compensation in
connection with the transactions contemplated by this Agreement based on any
arrangement or agreement made by or on behalf of the Company and the Company
will indemnify and hold the Investor harmless against any liability or expense
to them arising out of such a claim.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF INVESTOR
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The Investor hereby represents and warrants to the Company that:
3.1 Investment Intent; Accredited Investor; Legends. The Investor is
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purchasing or acquiring the Warrants for its own account for investment and not
with a present view to, or for sale in connection with, any distribution thereof
in violation of the Act. The Investor represents and warrants that the Investor:
(a) is experienced in the evaluation of businesses similar to the Company, (b)
has such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of an investment in the Company, (c)
has the ability to bear the economic risks of an investment in the Company, (d)
has been furnished with or has had access to such information as is specified in
subparagraph (b)(2) of Rule 502 promulgated under the Act and has carefully
reviewed and understood such information, (e) has been afforded the opportunity
to ask questions of and to receive answers from the Company and to obtain any
additional information necessary to make an informed investment decision with
respect to an investment in the Company, and (f) is an "Accredited Investor" as
such term is defined in subparagraph (a) of Rule 501 promulgated under the Act.
The Investor hereby consents to the imposition of a legend substantially similar
to the following on each Warrant and, unless registered under the Act pursuant
to ARTICLE 6 hereof, each certificate for Shares of Common Stock issued upon
exercise of the Warrants, and the Investor agrees to abide by the restrictions
contained therein:
[This Warrant has] [The shares represented by this certificate have]
not been registered under the Securities Act of 1933, as amended (the "Act") and
may not be sold, transferred,
pledged, hypothecated or assigned unless registered under the Act or an opinion
of counsel, satisfactory to the corporation, is obtained to the effect that such
sale, transfer or assignment is exempt from the registration requirements of the
Act.
The Investor acknowledges that unless the Shares of Common Stock
issuable upon exercise of the Warrants have been registered under the Act
pursuant to ARTICLE 6 hereof, each representation and warranty made by the
Investor in this Section 3.1 must be made by the Investor again at the time of
each exercise of the Warrants, and the exercise of the Warrants shall be
conditioned and subject to such representation and warranty.
3.2 Authorization. The Investor has the power and authority to enter
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into this Agreement and to perform all of its obligations hereunder.
3.3 Restricted Securities. The Investor understands that the Warrants
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have not been registered under the Act by reason of a specific exemption from
the registration provisions of the Act which depends upon, among other things,
the bona fide nature of the Investor's investment intent as expressed herein.
The Investor acknowledges that the Warrants and, unless registered under the Act
pursuant to ARTICLE 6 hereof, the Shares of Common Stock issuable upon exercise
of the Warrants, when received, must be held indefinitely unless they are
subsequently registered under the Act or an exemption from such registration is
available. The Investor has been advised of or is aware of the provisions of
Rule 144 promulgated under the Act, which rule permits limited resale of
securities purchased in a private placement subject to the satisfaction of
certain conditions contained therein.
3.4 Brokerage. There are no valid claims for brokerage commissions,
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finder's fees or similar compensation in connection with the transactions
contemplated by this Agreement based upon any arrangement or agreement made by
or on behalf of the Investor and the Investor agrees to indemnify and hold
harmless the Company against any liability or expense to it arising out of such
a claim to the extent that such claim arises out of actions or alleged actions
of such Investor.
ARTICLE 4. CONDITIONS OF INVESTOR'S OBLIGATIONS
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The obligation of the Investor to purchase and pay for the Warrants of
the Company subscribed for by the Investor at the Closing shall be subject to
the satisfaction of each of the following conditions:
4.1 Representations and Warranties. The representations and warranties
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of the Company contained herein or in the exhibits annexed hereto or otherwise
made in writing by or on behalf of the Company in connection with the
transactions contemplated hereby shall be true and correct as of the Closing
with the same effect as though made on and as of that date.
4.2 Performance. The Company shall have performed and complied with all
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of the agreements and conditions contained herein and required to be performed
or complied with by the Company at or prior to the Closing and shall not be in
breach of any provision of this Agreement.
4.3 Consents and Waivers. All necessary consents, waivers, approvals,
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amendments and other action on the part of any person necessary to have been
obtained or effected in order to carry out the transactions contemplated by this
Agreement shall have been duly obtained or effected and shall be in full force
and effect and adequate.
4.4 Legal Action.
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(a)......There shall not have been instituted or threatened any
material legal proceeding seeking to prohibit the consummation of the
transactions contemplated by this Agreement, or to obtain damages from the
Investor with respect thereto.
(b)......None of the parties hereto shall be prohibited by any order,
writ, injunction or decree of any governmental body of competent jurisdiction
from consummating the transactions contemplated by this Agreement, and no action
or proceeding shall then be pending which questions the validity of this
Agreement, any of the transactions contemplated hereby or any action which has
been taken by any of the parties in connection herewith or in connection with
any of the transactions contemplated hereby.
ARTICLE 5. AFFIRMATIVE COVENANTS OF THE COMPANY
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The Company covenants with the Investor that:
5.1 Use of Proceeds. The Company shall use the proceeds from the sale
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of the Warrants to the Investor and the exercise of the Warrants by the Investor
for general working capital purposes and not for the repayment of existing
indebtedness or other obligations to any insider of the Company.
5.2 Board of Directors. The Company agrees that within ten business
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days following the exercise, in the aggregate, of 90% of the Warrants and the
payment of the exercise price therefor and issuance of, in the aggregate,
450,000 Shares in respect thereof, the Company shall cause Xxxxxxx Xxxxxx or his
designee to be appointed to the board of directors of the Company.
5.3 Future Commissions. Subject to the requirements of applicable state
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and federal securities laws, the Company shall pay to the Investor or its
designee a three percent (3%) commission on any and all amounts received,
directly or indirectly, by the Company or any of its affiliates, as a
consequence of any merger, license or other similar arrangement or remuneration
which results as a direct consequence of the efforts of the Investor or its
identified designee or agent, provided however that such commission shall be
payable hereunder only if the Company's senior management has approved, in
writing and prior to any contact by the Investor with any person or entity, such
efforts of the Investor or its identified designee or agent. As used in this
Section 5.3, the term "affiliates" shall include the principals and associates
of the Company and any individual, corporation, organization, firm or company of
which the Company is a member, employee, principal, or party to, or from which
the Company would otherwise benefit financially, either directly or indirectly.
5.4 S-3 Registration. The Company shall use its best efforts to prepare
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and file with the Commission a registration statement on Form S-3 with respect
to the Shares (the "Registration Statement") within thirty (30) days following
the Closing pursuant to ARTICLE 6 hereof. The Company shall use its best efforts
to cause such Registration Statement to become effective within ninety (90) days
following the Closing and remain effective for such period as may be reasonably
necessary to effect the sale of such Shares, not to exceed nine (9) months
following the Closing.
ARTICLE 6. REGISTRATION; PUT OPTION
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6.1 S-3 Registration. The Company shall use its best efforts to:
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(a)......prepare and file with the Commission within thirty (30) days
following the Closing a Registration Statement with respect to the Shares, and
use its best efforts to cause such Registration Statement to become and remain
effective for such period as may be reasonably necessary to effect the sale of
such Shares, not to exceed nine (9) months;
(b)......prepare and file with the Commission such amendments to such
Registration Statement and supplements to the prospectus contained therein as
may be necessary to keep such Registration Statement effective for such period
as may be reasonably necessary to effect the sale of such Shares, not to exceed
nine (9) months;
(c)......furnish to the Investor participating in such registration and
to the underwriters of the securities being registered, if any, such reasonable
number of copies of the Registration Statement, preliminary prospectus, final
prospectus and such other documents as such underwriters may reasonably request
in order to facilitate the public offering of such securities;
(d)......use its best efforts to register or qualify the securities
covered by such Registration Statement under the state securities or blue sky
laws of such jurisdictions as the Investor may reasonably request within twenty
(20) days following the original filing of such Registration Statement, except
that the Company shall not for any purpose be required to execute a general
consent to service of process or to qualify to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified;
(e)......notify the Investor, promptly after it shall receive notice
thereof, of the time when such Registration Statement has become effective or a
supplement to any prospectus forming a part of such Registration Statement has
been filed;
(f)......notify the Investor promptly of any request by the Commission
for the amending or supplementing of such Registration Statement or prospectus
or for additional information;
(g)......prepare and file with the Commission, promptly upon the
request of the Investor, any amendments or supplements to such Registration
Statement or prospectus which, in
the opinion of counsel for the Investor (and concurred in by counsel for the
Company), is required under the Act or the rules and regulations thereunder in
connection with the distribution of the Registrable Securities by such Investor;
(h)......prepare and promptly file with the Commission and promptly
notify the Investor of the filing of such amendment or supplement to such
Registration Statement or prospectus as may be necessary to correct any
statements or omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Act, any event shall have
occurred as the result of which any such prospectus or any other prospectus as
then in effect would include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances in which they were made, not misleading; and
(i)......advise the Investor, promptly after it shall receive notice or
obtain knowledge thereof, of the issuance of any stop order by the Commission
suspending the effectiveness of such Registration Statement or the initiation or
threatening of any proceeding for that purpose and promptly use its best efforts
to prevent the issuance of any stop order or to obtain its withdrawal if such
stop order should be issued.
6.2 Expenses. All fees, costs and expenses of and incidental to such
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registration, inclusion and public offering (as specified in paragraph (b)
below) in connection therewith shall be borne by the Company, other than the
fees and costs of counsel to the Investor, which fees and costs shall be borne
by the Investor; and provided, however, that any security holders participating
in such registration shall bear their pro rata share of (i) the underwriting
discount and commissions and transfer taxes, and (ii) the expense of any special
audit of the Company's financial statements if the registration does not permit
use of existing or contemplated audited statements.
6.3 Indemnification.
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(a)......The Company will indemnify and hold harmless the Investor
whose Shares are included in a Registration Statement pursuant to the provisions
of this Article and any underwriter (as defined in the Act) for such Investor
and each person, if any, who controls such Investor or such underwriter within
the meaning of the Act, from and against, and will reimburse such Investor and
each such underwriter and controlling person with respect to, any and all loss,
damage, liability, cost and expense to which such Investor or any such
underwriter or controlling person may become subject under the Act or otherwise,
insofar as such losses, damages, liabilities, costs or expenses are caused by
any untrue statement or alleged untrue statement of any material fact contained
in such Registration Statement, any prospectus contained therein or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading; provided, however, that
the Company will not be liable in any such case to the extent that any such
loss, damage, liability, cost or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission so
made in conformity with
information furnished by such Investor, such underwriter or such controlling
person in writing specifically for use in the preparation thereof.
(b)......The Investor whose Shares are included in a Registration
Statement pursuant to the provisions of this Article will indemnify and hold
harmless the Company, any underwriter and any controlling person of the Company
or such underwriter from and against, and will reimburse the Company,
underwriter or controlling person with respect to, any and all loss, damage,
liability, cost or expense to which the Company, any underwriter or any
controlling person thereof may become subject under the Act or otherwise,
insofar as such losses, damages, liabilities, costs or expenses are caused by
any untrue or alleged untrue statement of any material fact contained in such
Registration Statement, any prospectus contained therein or any amendment or
supplement thereto, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was so made in reliance upon and in strict conformity with
written information furnished by such Investor specifically for use in the
preparation thereof.
(c)......Promptly after receipt by an indemnified party pursuant to the
provisions of paragraph (a) or (b) of this Section 6.3 of notice of the
commencement of any action involving the subject matter of the foregoing
indemnity provisions, such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the provisions of paragraph (a)
or (b), promptly notify the indemnifying party of the commencement thereof; but
the omission to so notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than hereunder.
In case such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party shall
have the right to participate in, and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided, however,
that if the defendants in any action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, or if there is a conflict of interest which would prevent
counsel for the indemnifying party from also representing the indemnified party,
the indemnified party or parties shall have the right to select separate counsel
to participate in the defense of such action on behalf of such indemnified party
or parties. After notice from the indemnifying party to the indemnified party of
its election so to assume the defense of any action, the indemnifying party will
not be liable to such indemnified party pursuant to the provisions of paragraphs
(a) or (b) hereof for any legal or other expense subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation, unless (i) the indemnified party shall have employed
counsel in accordance with the provision of the preceding sentence, (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after the notice of the commencement of
the action, or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party.
6.4 Payment of Warrant Exercise Price; Refund of Warrant Exercise
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Proceeds.
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(a)......If at the time of exercise of any Warrants by the Investor the
Commission has not declared the Registration Statement effective, then the
Investor shall reaffirm in writing the representations and warranties set forth
in Section 3.1 hereof, and at the Investor's election the Investor may either:
(i) make payment of the exercise price of such Warrants to the Company against
delivery of unregistered Shares subject to the restrictions of and with the
legend set forth in Section 3.1; or (ii) delay payment of the exercise price,
without accrual of interest thereon, until the business day immediately
following the date the Investor receives notice that the Commission has declared
the Registration Statement effective. In the event the Investor elects to delay
such payment, certificates representing the Shares issuable in connection with
such exercise shall be delivered to the Investor when the Registration Statement
has become effective and such payment has been received by the Company.
(b)......If the Commission has not declared the Registration Statement
effective by the close of business on the ninetieth (90th) day following the
Closing, the Company shall refund to the Investor an amount equal to one percent
(1%) of the combined proceeds of the exercise of the Warrants theretofore paid
to the Company. Thereafter, following the completion of each successive
thirty-day period during which the Commission has not declared the Registration
Statement effective, the Company shall refund to the Investor an amount equal to
an additional one percent (1%) of the combined proceeds of the exercise of the
Warrants theretofore paid to the Company. In the event of any refund pursuant to
this Section (b), the Warrants theretofore exercised shall be considered as
having been exercised in full as of their original exercise date at a
proportionately reduced exercise price. If the Commission has not declared the
Registration Statement effective because of any action or failure to act by the
Investor, there shall be no refund of the proceeds of the exercise of the
Warrants under this Section (b).
6.5 Exclusive Obligation to Register. Except as provided in this
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ARTICLE 6 and in Section 5.4 hereof, the Company will have no obligation to the
Investor to register under the Act any Shares received by the Investor pursuant
to this Agreement.
6.6 Put Option. If at any time or times following the effective date of
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the Registration Statement and prior to the Warrant Expiration Date during which
the Registration Statement remains effective, both the closing bid price of the
Company's Common Stock, as reported on the Nasdaq National Market, and the
average closing bid price of the Company's Common Stock over the fourteen (14)
trading days immediately prior thereto (together, the "15 Trading Day Period"),
equals or exceeds $6.75 (the "(Price Condition"); then the Company shall at each
such time or at any time thereafter have the option (a "Put Option") to compel
the Investor to exercise the Warrants as hereinafter provided and make payment
to the Company of the aggregate exercise price therefor by providing written
notice to the Investor of the Company's election to exercise the Put Option.
Within ten (10) business days following the date of each such notice
(each such notice date referred to herein as a "Put Option Election Date"), the
Investor shall exercise the Warrants with respect to that number of Shares as is
equal to the lesser of:
(A) 500,000, less such number of Shares
as to which Warrants have been
previously exercised, either
pursuant to the exercise of an
earlier Put Option or pursuant to
an earlier exercise of Warrants by
the Investor;
(B) the number of Shares specified by
the Company in each such notice; or
(C) unless the Aggregate Trading Volume
Condition (defined below) is met, a
quotient, the numerator of which is
equal to the product of 500,000
times the average daily trading
volume of the Company's Common
Stock for the 15 Trading Day
Period, and the denominator of
which is equal 40,000.
In the event the Price Condition is met and the aggregate number of shares of
the Company's Common Stock traded on the Nasdaq National Market exceeds 300,000
shares during any 30 trading day period prior to the Warrant Expiration Date
(the "Aggregate Trading Volume Condition"), then following written notice of the
Company's election to exercise the Put Option, the Investor shall exercise the
Warrants with respect to that number of Shares as is equal to the lesser of (A)
or (B) above. In the event the Investor fails to exercise the Warrants and make
payment to the Company of the aggregate exercise price therefor within ten (10)
business days following the Put Option Election Date, the Company may, in
addition to any other remedies it may have under this Agreement or otherwise,
terminate the Warrants without any obligation to obtain the consent of or
provide notice to the Investor, or deem the Warrants to have been exercised and
demand payment of the exercise price therefor.
ARTICLE 7. MISCELLANEOUS
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7.1 Termination.
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(a) At any time prior to the Closing, this Agreement may be terminated
(i) by mutual consent of the parties, (ii) by either side if there has been a
material misrepresentation, breach of warranty or breach of covenant by the
other side in its representations, warranties and covenants set forth herein,
(iii) by the Investor if the conditions stated in ARTICLE 4 have not been
satisfied at or prior to the Closing.
(b) If this Agreement shall be terminated in accordance with this
Section 7.1, all obligations of the parties hereunder shall terminate without
liability of any party to the others except as provided in Section 7.4. In the
event that this Agreement is so terminated, each party will return all papers,
documents, financial statements and other data furnished to it by or with
respect to each other party to such other party (including any copies thereof
made by the first party).
(c) This Agreement shall terminate without further liability to any of
the parties at such time as all of the obligations of the Company under the
Warrants have been fully satisfied and discharged.
7.2 Survival of Representations and Covenants. All representations,
-------------------------------------------
warranties, covenants, agreements and obligations made herein or in any
schedule, exhibit, notice, certificate or other document executed in connection
herewith or delivered by any party to another party incident hereto shall be
deemed to have been relied upon by the other party hereto and survive the
execution and/or delivery thereof, and all statements contained in any such
schedules, exhibit, notice, certificate or other document delivered hereunder or
in connection herewith shall be deemed to constitute representations and
warranties made by the parties herein.
7.3 Notices. Any notice or other communication in connection with this
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Agreement shall be deemed to be delivered if in writing (or in the form of a
telegram) addressed as provided below and if either (a) actually delivered at
said address, or (b) in the case of a letter, three business days shall have
elapsed after the same shall have been deposited in the United States mails,
postage prepaid and registered or certified, return receipt requested:
If to the Company, to:
Boston Biomedica, Inc.
000 Xxxx Xxxxxx
Xxxx Xxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxxx, President
with a copy to:
Brown, Rudnick, Freed & Gesmer, P.C.
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx X. London, Esq.
Fax: (000) 000-0000
If to the Investors, to:
Paradigm Group, L.L.C.
0000 Xxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
and in any case at such other address as the addressee shall have specified by
written notice. All periods of notice shall be measured from the date of
delivery thereof.
7.4 Publicity and Disclosures; Confidentiality. No press releases or
--------------------------------------------
any public disclosure, either written or oral, of the transactions contemplated
by this Agreement shall be made without the prior knowledge and written consent
of the Company. The Investor agrees that it will keep confidential and not
disclose or divulge any confidential, proprietary or secret information which it
may obtain from the Company in connection with the transactions contemplated
herein, or pursuant to inspection rights granted hereunder unless such
information is or hereafter becomes public information.
7.5 Assignment. This Agreement and the rights hereunder shall not be
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assignable by either party.
7.6 Entire Agreement. This Agreement (including all exhibits or
-----------------
schedules appended to this Agreement and all documents delivered pursuant to or
referred to in this Agreement, all of which are hereby incorporated herein by
reference) constitutes the entire agreement between the parties, and all
promises, representations, understandings, warranties and agreements with
reference to the subject matter hereof and inducements to the making of this
Agreement relied upon by any party hereto, have been expressed herein or in the
documents incorporated herein by reference.
7.7 Amendments and Waivers. Changes in or additions to this Agreement
-----------------------
may be made or compliance with any term, covenant, agreement, condition or
provision set forth herein or therein may be omitted or waived (either generally
or in a particular instance and either retroactively or prospectively), only
upon written consent of the Company and the Investor.
7.8 Governing Law; Severability. This Agreement shall be deemed a
-----------------------------
contract made under the laws of the Commonwealth of Massachusetts and, together
with the rights and obligations of the parties hereunder, shall be construed
under and governed by the laws of such Commonwealth. The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision hereof.
7.9 Counterparts. This Agreement may be executed in multiple
------------
counterparts, each of which shall be deemed in original but all of which
together shall constitute one and the same instrument.
7.10 Effect of Table of Contents and Headings. Any table of contents,
-----------------------------------------
title of an article or section heading herein contained is for convenience of
reference only and shall not affect the meaning of construction of any of the
provisions hereof.
IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the parties hereto or their duly authorized representatives
effective as of the date first above written.
BOSTON BIOMEDICA, INC.
Corporate Seal
By: /S/ Xxxxxxx X. Xxxxxxxxxx
--------------------------
ATTEST:
/S/ Xxxxx X. Xxxxx
-----------------------------
Notary
Commission Expires Sept 24, 2004
PARADIGM GROUP, L.L.C.
By: /S/
--------------------------
LIST OF EXHIBITS
----------------
A. Form of $4.25 Stock Purchase Warrant
B. Form of $5.25 Stock Purchase Warrant
C. Disclosure Schedules
SCHEDULES
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Schedule 2.5
Registration Rights
-------------------
The Company is a party to a Registration Rights Agreement dated June 5,
1990, as amended (the "Registration Agreement"), with G&G Diagnostics Limited
Partnership I and G&G Diagnostics Limited Partnership II (together, "G&G")
pursuant to which G&G has certain rights to have its shares of Common Stock
registered by the Company under the Securities Act. A total of 357,667 shares of
Common Stock (the "Registrable Shares") held by G&G or subject to warrants held
by G&G may be registered under the Registration Agreement. If the Company
proposes to register any of its securities under the Securities Act, either for
its own account or for the account of other securityholders, G&G is entitled to
notice of the registration and is entitled to include, at the Company's expense,
the Registrable Shares therein, provided, among other conditions, that the
underwriters have the right to limit the number of such shares included in the
registration. In addition, G&G may require the Company at its expense on no more
than two occasions, to file a registration statement under the Securities Act
with respect to its Registrable Shares, and the Company is required to use its
best efforts to effect such a registration, subject to certain conditions and
limitations. Further, G&G may require the Company at its expense to register the
Registrable Shares on Form S-3 when such form is available to the Company,
subject to certain conditions and limitations.
-15-
Schedule 2.7
Brokerage
In connection with this Agreement, the Company will pay National
Securities, a registered broker dealer, a fee equal to six percent (6%) of the
Purchase Price paid by the Investor and received by the Company at the Closing
and six percent (6%) of the aggregate amount paid by the Investor and received
by the Company upon exercise of the Warrants (net of any refunds payable by the
Company to the Investor subsequent to the exercise of the Warrants). In
addition, the Company will issue to National Securities warrants to purchase
shares of the Company's common stock as follows:
Warrants to Purchase Shares Exercise Price Restriction on Exercise
--------------------------- -------------- -----------------------
40,000 $4.25/share Exercisable for that percentage of
the 40,000 shares equal to that
percentage of the Investor's $4.25
Warrant for 400,000 shares which
have been exercised by the Investor.
10,000 $5.25/share Immediately exercisable in full.
25,000 $8.00/share Only exercisable if and when the
Investor has exercised in full its
Warrants to purchase 500,000 shares.
The warrants to be issued to National Securities will expire on August
15, 2001.
-16-
