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EXHIBIT 10.9
BIOFACTORS, INC.
UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
AS OF FEBRUARY 1, 1996
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BIOFACTORS, INC.
UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
FEBRUARY 1, 1996
TABLE OF CONTENTS
1. Purchase, Sale and Terms of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Sale and Issuance of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Subsequent Closings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Repayment Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4. Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.1 Sale, Issuance and Price of Common Stock . . . . . . . . . . . . . . . . . . . . . 2
4.2 Registration Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
5. Certain Tax Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6. Representations and Warranties of the Purchasers . . . . . . . . . . . . . . . . . . . . . 3
7. Conditions of Purchaser's Obligations at Closing . . . . . . . . . . . . . . . . . . . . . 5
7.1 Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7.2 Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7.3 Consents and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7.4 Security Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.1 Survival of Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.2 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.3 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.4 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.5 Titles and Subtitles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.6 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8.7 Entire Agreement, Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . 7
8.8 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
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UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
THIS UNSECURED NOTE AND STOCK PURCHASE AGREEMENT dated as of February
1, 1996 (this "Agreement"), is by and among the purchasers listed on Schedule A
hereto (as such Schedule may be amended from time to time, individually a
"Purchaser" and collectively the "Purchasers"), and BioFactors, Inc., a
Delaware corporation (the "Company").
NOW, THEREFORE, in consideration of the following mutual covenants and
agreements, the Purchasers and the Company hereby agree as follows:
AGREEMENT
1. Purchase, Sale and Terms of the Notes.
1.1 Sale and Issuance of the Notes.
(a) The Company has authorized the issuance and
sale to the Purchasers of the Company's unsecured promissory notes in the
maximum aggregate original principal amount of up to $250,000, bearing interest
at the rate of 10% per annum (computed on the basis of a 365-day year for the
actual number of days elapsed), substantially in the form set forth in Exhibit
A hereto (herein referred to individually as a "Note" and collectively as the
"Notes," which terms shall also include any notes delivered in exchange or
replacement therefor).
(b) Subject to the terms and conditions of this
Agreement, each Purchaser agrees, severally, but not jointly, to purchase at
the Closing (as defined below), and the Company agrees to sell and issue to
each Purchaser at the Closing, a Note in the principal amount set forth
opposite each such Purchaser's name on the Schedule of Purchasers attached
hereto as Schedule A at a purchase price equal to the original principal amount
of such Note.
1.2 Closing. The initial purchase and sale of the Notes
shall take place at 10:00 a.m. on February 21, 1996, at the offices of Xxxxxxxx
& Xxxxxx, L.L.C., 000 Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx, or at such other
date, time and place as shall be designated by the Company (the "Closing,"
which term also shall include any subsequent closing pursuant to the provisions
of Section 1.3). At or promptly after the Closing, the Company will execute and
deliver Notes, each dated the date of the Closing and payable to the order of
the respective Purchasers, in the respective principal amounts set forth on
Schedule A, against delivery of the full purchase price for the Notes by wire
transfer of the purchase price to an account designated in writing by the
Company.
1.3 Subsequent Closings. If the Notes issued or sold at
the Closing represent, in the aggregate, less than the maximum aggregate
original principal amount as set forth in Section 1.1(a), the Company may issue
additional Notes at one or more subsequent closings held within thirty (30)
days of the Closing; provided, however, that the Company, in its sole
discretion, at any time after the initial Closing, may terminate this offering
and accept no additional purchases. Upon execution of counterpart signature
pages to each of this Agreement (as defined herein), any additional
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purchaser purchasing a Note at any such subsequent closing shall be added to
Schedule A and shall be deemed to be a Purchaser for purposes of this
Agreement. The date of the final purchase and sale of the Notes shall be
referred to herein as the "Final Closing."
2. Maturity. Unless previously converted pursuant to Section 3
hereof, the Notes shall mature and become due and payable in full at the close
of business on March 31, 1996.
3. Repayment Rights. The Notes are subject to mandatory
adjustment of their repayment terms to be identical to the repayment terms of
the Underwriter bridge, upon the completion of the Underwriter bridge.
4. Common Stock.
4.1 Sale, Issuance and Price of Common Stock.
(a) The Company has authorized the issuance and
sale to the Purchasers of a maximum aggregate of 75,000 shares of the Company's
common stock, $.01 par value per share (the "Shares").
(b) At the Closing, and at any subsequent closing
up to and including the Final Closing, the Company shall issue to each
Purchaser purchasing a Note against receipt of the Purchase Price (as defined
in Section 4.1(c)), the number of shares of Common Stock set forth opposite
such Purchaser's name on Schedule A.
(c) The purchase price for the Shares shall be
$.01 per share (the "Purchase Price"), which is hereby agreed to be the fair
market value of such Shares.
4.2 Registration Rights. The Company covenants and
agrees to enter into, with each of the Purchasers, a registration rights
agreement substantially in the form of the registration rights agreement to be
entered into by it in connection with the Underwriter Transaction, which
agreement shall provide for the registration under the Act (as defined below)
of the resale of the Shares by the Purchasers, subject to the conditions and
limitations of such agreement. As to any Purchaser, the Company's obligation
to enter into such agreement shall be conditioned upon such Purchaser's
execution and delivery of a counterpart copy of such agreement, which will
provide for a "lock-up" of the Purchaser's Shares and such other customary
provisions as may be required by the Underwriter.
5. Certain Tax Consequences. Each Purchaser hereby acknowledges
that for federal income tax purposes he or it is purchasing investment units
consisting of a Note and Shares and that the allocation of consideration made
herein between the Note and the Shares shall be binding upon each Purchaser
unless such Purchaser explicitly discloses on its tax return that it is making
a different allocation. It is further understood that such allocation does not
bind the Internal Revenue Service, and in the event the fair market value of
the Shares is determined to be greater than the Purchase Price of the Shares
set forth in Section 4.1(c), the cost basis of the Notes would have to be
reduced by the amount of such excess and the Notes would be deemed to be issued
at a discount. Individual cash basis holders of Notes would then report the
difference between the allocated cost of the Notes and the aggregate principal
and interest received as ordinary income upon payment of the Notes. Gain on the
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sale or exchange of a discounted Note would be ordinary income up to the
accrued portion of the discount and interest. Other Note holders would be
subject to the rules under Internal Revenue Code Sections 1281-1283 regarding
the ratable accrual of the discount and interest on short-term obligations.
6. Representations and Warranties of the Purchasers. Each
Purchaser severally, but not jointly, hereby represents and warrants to the
Company that:
6.1 Such Purchaser is aware that the investment in the
Note and the Shares involves a high degree of risk.
6.2 Such Purchaser understands and acknowledges that
there is no assurance as to the future performance of the Company.
6.3 Such Purchaser understands and acknowledges that
there may be certain adverse tax consequences to him or it in connection with
his or its purchase of the Note and the Shares (including but not limited to
the tax consequences described in Section 5), that the Company is not giving
and has not given any advice on the tax consequences of the investment and that
the Company has advised all Purchasers to seek the advice of their own experts
in such areas prior to making this investment.
6.4 This Agreement has been duly executed and delivered
by such Purchaser and constitutes the Purchaser's valid and legally binding
obligation, enforceable in accordance with its terms. Each Purchaser
represents that he or it has full power and authority to enter into this
Agreement.
6.5 The Confidential Investor Questionnaire being
delivered by the Purchaser to the Company simultaneously herewith
is true, complete and correct in all material respects; and the Purchaser
understands that the Company has determined that the exemption of the Note and
the Shares from the registration provisions of the Securities Act pursuant to
Regulation D thereof, which is available for non-public offerings, is
applicable to the offer and sale of the Note and the Shares, and that such
determination is based in part upon the representations, warranties and
agreements made by the Purchaser herein and in the Confidential Investor
Questionnaire.
6.6 The Note and the Shares to be received by such
Purchaser pursuant to the terms hereof, and will be acquired for investment for
such Purchaser's own account, not as a nominee or agent, and not with a view to
the resale or distribution of any part thereof, and such Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing the same.
6.7 Such Purchaser understands that the Securities he or it is
receiving hereunder are characterized as "restricted securities" under the
federal securities laws inasmuch as they are being acquired from the Company in
a transaction not involving a public offering and that under such laws and
applicable regulations such securities may be resold without registration under
the Securities Act of 1933, as amended (the "Act"), only in certain limited
circumstances.
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6.8 Each Purchaser represents and warrants that he or it
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 Notes and
the Shares and has obtained, in his or its own judgment, sufficient information
from the Company to evaluate the merits and risks of an investment in the
Company. Each Purchaser further represents and warrants that he or it has not
utilized any person as a purchaser representative as such term is defined in
Regulation D in connection with evaluating such merits and risks, but rather
has relied solely upon his or its own investigation in making a decision to
invest in the Company.
6.9 No representations or warranties have been made to
the Purchaser by the Company or any of its directors, agents, employees or
affiliates; and in entering into this transaction the Purchaser is not relying
upon any information other than that obtained as the result of independent
investigations, if any, by the Purchaser.
6.10 Each Purchaser represents and warrants that he or it
has had a reasonable opportunity to ask questions and to receive satisfactory
answers concerning the offering and other matters pertaining to his or its
investment and all such questions have been answered to the Purchaser's full
satisfaction; the Purchaser further represents and warrants that he or it has
had reasonable opportunity to obtain all the information he or it considers
necessary or appropriate for deciding whether to purchase the Note and the
Shares.
6.11 Each Purchaser represents and warrants that he or it
is an "accredited investor" within the meaning of Rule 501(a) of Regulation D,
promulgated under the Act.
6.12 The address set forth below is the Purchaser's true
and correct domicile, and the Purchaser has no present intention of becoming a
resident of any other state or jurisdiction.
6.13 Without in any way limiting the representations set
forth above, such Purchaser further agrees not to make any disposition of the
Securities unless there is then in effect a registration statement under the
Act covering such proposed disposition and such disposition is made in
accordance with such registration statement; or such Purchaser shall have
notified the Company of the proposed disposition and shall have furnished the
Company with a statement of the circumstances surrounding the proposed
disposition, and, if reasonably requested by the Company, such Purchaser shall
have furnished the Company with an opinion of counsel, reasonably satisfactory
to the Company, that such disposition will not require registration of such
shares under the Act. It is agreed that the Company will not require opinions
of counsel for transactions made pursuant to Rule 144 except if reasonably
requested by the Company.
6.14 It is understood that the Securities may bear one or
all of the following legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES
LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH
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RESPECT TO THE SECURITIES UNDER SUCH ACT OR APPLICABLE STATE SECURITIES LAWS OR
AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 PROMULGATED
UNDER SUCH ACT."
(b) Any legend required by the laws of the State
of Delaware or applicable state securities laws.
7. Conditions of Purchaser's Obligations at Closing. The
obligations of each Purchaser under subsection 1.1(b) of this Agreement are
subject to the fulfillment on or before the Closing of each of the following
conditions, the waiver of which shall not be effective against any Purchaser
who does not consent in writing thereto:
7.1 Performance. The Company shall have performed and
complied with all agreements, obligations, and conditions contained in this
Agreement that are required to be performed or complied with by it on or before
the Closing.
7.2 Qualifications. The Company shall have obtained all
necessary Blue Sky law permits and qualifications, or secured exemptions
therefrom, required by any state for the offer and sale of the Notes and the
Shares.
7.3 Consents and Waivers. The Company shall have
obtained any and all consents and waivers necessary or appropriate for
consummation of the transactions contemplated by this Agreement.
8. Miscellaneous.
8.1 Survival of Warranties. The warranties,
representations and covenants of the Company and the Purchasers contained in or
made pursuant to this Agreement shall survive the execution and delivery of
this Agreement and the Closing and shall in no way be affected by any
investigation of the subject matter thereof made by or on behalf of the
Purchasers or the Company.
8.2 Successors and Assigns. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement
8.3 Governing Law. This Agreement shall be governed by
and construed under the laws of the State of Colorado, disregarding any
Colorado principles of conflicts of laws that otherwise would provide for the
application of the substantive laws of another jurisdiction.
8.4 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same Agreement.
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8.5 Titles and Subtitles. The titles and subtitles used
in this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
8.6 Notices. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in writing and shall
be deemed effectively given upon personal delivery to the party to be notified
or four (4) days after deposit with the United States Post Office or air
courier in the case of non-U.S. Purchasers, by registered or certified mail,
postage prepaid and addressed to the party to be notified at the address
indicated for such party on the signature page hereof, or at such other address
as such party may designate by ten (10) days' advance written notice to the
other parties.
8.7 Entire Agreement, Amendments and Waivers. This
Agreement and the Notes constitute the full and entire understanding and
agreement between the parties with regard to the subject matter hereof. Any
term of this Agreement or the Notes may be amended and the observance of any
term of this Agreement or the Notes may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the holders of a majority of the debt
represented by the Notes then outstanding. Any amendment or waiver effected in
accordance with this Section 9.7 shall be binding upon each holder of any
securities acquired under this Agreement at the time outstanding (including
securities for which any such securities are convertible or exercisable), each
future holder of all such securities, and the Company.
8.8 Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
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IN WITNESS WHEREOF, the parties have executed this Unsecured Note and
Stock Purchase Agreement as of the date first above written.
BIOFACTORS, INC.
By: /s/ Xxxxxx X. Xxxx
----------------------------------------
Xxxxxx X. Xxxx
President & CEO
Address: 0000 Xxxx Xxxx., Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: President
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Signature Page
BioFactors, Inc.
Unsecured Note and Stock Purchase Agreement
Dated February 1, 1996
PURCHASER:
By: /s/ Xxxxxx Xxxxxx
----------------------------------------
Xxxxxx Xxxxxx
Xxxxxx & Xxxx Xxxxxx
Address: 0 Xxxxxx Xx.
Xxxxxx, XX 00000
Amount Subscribed for $50,000
PURCHASER:
By: /s/ Xxxx X. Xxxxxxxxx
----------------------------------------
Xxxx Xxxxxxxxx
Individual Investor
Address: 000 X 00xx Xx 00X
XX, XX 00000
Amount Subscribed for $50,000.00
PURCHASER:
By: /s/ Xxxx Xxx
----------------------------------------
Xxxx Xxx
Address: 0000 Xxxx Xx.
Xxx Xxxxx, XX 00000
Amount Subscribed for $25,000
PURCHASER:
By: /s/ Ram Iyengar
----------------------------------------
Ram Iyengar
Address: 0 Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Amount Subscribed for $25,000.00
PURCHASER:
By:
----------------------------------------
Xxxxxx X. Xxxxxxxx
Address: 00 Xxxxxxxxx Xx.
Xxxxxxxx Xxxx, XX 00000
Amount Subscribed for $10,000.00
PURCHASER:
By: /s/ Xxxx X. Xxxxxx
----------------------------------------
Xxxx X. Xxxxxx
Address: 0000 Xxxxxxxx Xx
Xxxxxxxxxx, Xxxxxxxx 00000
Amount Subscribed for $ 25,000.00
PURCHASER:
By: /s/ Xxxxxxx & Xxxxxxx Xxxxxxxx
----------------------------------------
Xxxxxxx & Xxxxxxx
Address: 000-00X Xxxxx Xxxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
Amount Subscribed for $30,000.00
PURCHASER:
By: /s/ Xxxxx X. Twarilosz
----------------------------------------
Xxxxx X. Twarilosz
Address: 0000 X. Xxxxxxxxx
Xxxxxxx, XX 00000
Amount Subscribed for $25,000.00
PURCHASER:
By: /s/ Xxxxx Xxxxxxxx
----------------------------------------
Xxxxx Xxxxxxxx
Address: 0000 X. 00xx Xx.
Xxxxxxxx, XX 00000
Amount Subscribed for $25,000.00
PURCHASER:
By: /s/ Xxxxxxx Xxx
----------------------------------------
Xxxxxxx Xxx
Address: 00 Xxxxxx Xxxxx
Xxxxxx, XX 00000
Amount Subscribed for $25,000.00
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BIOFACTORS, INC.
FIRST AMENDMENT TO
UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
This FIRST AMENDMENT TO UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
(this "Amendment") is entered into as of March 22, 1996, by and among
BioFactors, Inc., a Delaware corporation (the "Company") and the parties named
on the signature pages hereto (all of such parties other than the Company,
collectively, the "Majority Noteholders") and amends that certain Unsecured
Note and Stock Purchase Agreement dated as of February 1, 1996, by and among
the Company and the Purchasers named therein (the "Note Agreement").
WHEREAS, the Majority Noteholders are the holders of the unsecured
promissory notes (the "Notes") issued pursuant to the Note Agreement and,
collectively, are the holders of Notes representing in excess of fifty percent
of the aggregate principal amount of all the Notes outstanding as of the date
hereof and, pursuant to Section 8.7 of the Note Agreement, can bind each holder
of the Notes outstanding as of the date of this Agreement;
WHEREAS, pursuant to the Note Agreement, the repayment terms of the
Notes automatically adjust to conform to the terms of the Company's bridge
notes placed by the underwriter of the Company's initial public offering of its
common stock (the "IPO");
WHEREAS, the Company has entered into a letter of intent with Xxxxxx
Xxxxxxx & Company, L.P. ("Xxxxxx Xxxxxxx") pursuant to which Xxxxxx Xxxxxxx has
agreed to underwrite the Company's IPO and to place the Company's promissory
notes having a minimum aggregate principal amount of $500,000 (the "Xxxxxx
Xxxxxxx Bridge"); and
WHEREAS, it being acknowledged that the placement of the Xxxxxx
Xxxxxxx Bridge and the subsequent underwriting of the IPO will be of
substantial benefit to the Company and the Majority Noteholders, the Company
and the majority Noteholders desire to enter into this Amendment to extend the
maturity date of the Notes to accommodate the placement of the Xxxxxx Xxxxxxx
Bridge and to acknowledge the conformance of the repayment terms of the Notes
consistent with the terms of the notes issued in connection with the Xxxxxx
Xxxxxxx Bridge (the "Xxxxxx Xxxxxxx Notes").
NOW THEREFORE, in consideration of the above and the following mutual
covenants and agreements, the parties agree as follows:
1. Definitions. Unless otherwise defined herein, capitalized
terms shall have the meanings given such terms in the Note Agreement.
2. Amendments. The Majority Noteholders hereby agree to amend
the Note Agreement as follows:
a. Definitions. The term "Underwriter Bridge" shall be
replaced wherever it appears by the term "Xxxxxx Xxxxxxx Bridge" which term
shall have the following meaning: the placement by Xxxxxx Xxxxxxx of the
Company's promissory notes having a minimum aggregate principal amount of
$500,000.
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b. Authorized Issuance. Section 1.1(a) is amended by
replacing $250,000 with $300,000, such amount being the authorized aggregate
original principal amount of Notes issued pursuant to the Note Agreement and
Section 4.1(a) is amended by replacing 75,000 with 90,000, such amount being
the authorized amount of Shares issued.
c. Maturity Date Extension. Section 2 is amended in its
entirety as follows:
"2. Maturity. Unless the Xxxxxx Xxxxxxx Bridge shall
have been previously consummated, in which event the provisions of
Section 3 shall supersede the provisions of this Section 2, the Notes
shall mature and become due and payable in full at the close of
business on June 30, 1996."
3. Acknowledgment of Repayment Terms. The parties hereby agree
that Section 3 of the Note Agreement shall be construed as pertaining to the
Xxxxxx Xxxxxxx Bridge and that upon the closing of the Xxxxxx Xxxxxxx Bridge
the Notes shall mature and become due and payable in full on the earlier of (i)
one year from the date of issuance of the Xxxxxx Xxxxxxx Notes or (ii) the
consummation of a financing in which the Company receives gross proceeds of at
least $1,500,000.
4. Construction of Waiver. The Note Agreement shall be deemed
amended only to the extent set forth herein and remains in full force and
effect.
5. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument.
(The remainder of this page intentionally left blank.)
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IN WITNESS WHEREOF, the parties hereto have caused this First
Amendment to Unsecured Note and Stock Purchase Agreement to be duly executed as
of the day and year first above written.
BIOFACTORS, INC.
By: /s/ Xxxxxx X. Xxxx
------------------------------
Xxxxxx X. Xxxx
Title: President & CEO
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Signature Page to First Amendment to Unsecured Note
and Stock Purchase Agreement
By: /s/ Xxxxxxx Dallas
------------------------------
Name of Noteholder
Name: Xxxxxxx Dallas
Title:
By: /s/ Xxxx Xxx
------------------------------
Name of Noteholder
Name: Xxxx Xxx
Title:
By: /s/ Xxxx X. Xxxxxxxxx
3/24/96
------------------------------
Name of Noteholder
Name: Xxxx X. Xxxxxxxxx
Title:
By: /s/ Ram Iyengar
------------------------------
Name of Noteholder
Name: Ram Iyengar
Title:
By: /s/ Xxxxxxx X. Xxxxx
------------------------------
Name of Noteholder
Name: Xxxxxxx X. Xxxxx
Title:
By: /s/ Xxxxxx X. Xxxxxxxx
3/21/96
------------------------------
Name of Noteholder
Name: Xxxxxx X. Xxxxxxxx
Title:
By: /s/ Xxxx Xxxxxx
------------------------------
Name of Noteholder
Name: Xxxx Xxxxxx
Title:
By: /s/ Xxxxxxx Xxxxxxxx and
/s/ Xxxxxxx Xxxxxxxx
------------------------------
Name of Noteholder
Name: Xxxxxxx Xxxxxxxx and
Xxxxxxx Xxxxxxxx
Title: Joint
By: /s/ Xxxxx X. Twarilosz
------------------------------
Name of Noteholder
Name: Xxxxx X. Twarilosz
Title:
By: /s/ Xxxxx Xxxxxxxx
------------------------------
Name of Noteholder
Name: Xxxxx Xxxxxxxx
Title:
15
BIOFACTORS, INC.
SECOND AMENDMENT TO
UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
This SECOND AMENDMENT TO UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
(this "Amendment") is entered into as of July 1, 1996, by and among BioFactors,
Inc., a Delaware corporation (the "Company") and the parties named on the
signature pages hereto (all of such parties other than the Company,
collectively, the "Majority Noteholders") and amends that certain Unsecured
Note and Stock Purchase Agreement dated as of February 1, 1996, as amended, by
and among the Company and the Purchasers named therein (the "Note Agreement").
WHEREAS, the Majority Noteholders are the holders of the secured
promissory notes (the "Notes") issued pursuant to the Note Agreement and,
collectively, are the holders of Notes representing in excess of fifty percent
of the aggregate principal amount of all the Notes outstanding as of the date
hereof and, pursuant to Section 9.7 of the Note Agreement, can bind each holder
of the Notes outstanding as of the date of this Agreement;
WHEREAS, the Company has entered into a letter of intent with Xxxxxx
Xxxxxxx & Company, L.P. ("Xxxxxx Xxxxxxx") pursuant to which Xxxxxx Xxxxxxx has
agreed to underwrite the Company's IPO and to place promissory notes of the
Company having a minimum aggregate principal amount of $500,000 and warrants to
purchase common stock of the Company (the "Xxxxxx Xxxxxxx Bridge"); and
WHEREAS, in order to induce the customers of Xxxxxx Xxxxxxx to
purchase the notes and warrants comprising the Xxxxxx Xxxxxxx Bridge, and as a
condition precedent to such purchases, the Company is required to enter into
this Amendment providing for (i) a waiver of the current default on the Notes
and (ii) the extension of the maturity of the Notes; and
WHEREAS, the Company and the Majority Noteholders desire to waive the
current default on the Notes and to amend the Note Agreement to provide for an
extension of the maturity date of the Noted, it being acknowledged that the
closing of the Xxxxxx Xxxxxxx Bridge will be of substantial benefit to the
Company and the Majority Noteholders;
NOW THEREFORE, in consideration of the above and the following mutual
covenants and agreements, the parties agree as follows:
1. Definitions. Unless otherwise defined herein, capitalized
terms shall have the meanings given such terms in the Note Agreement.
2. Waiver. The Majority Noteholders hereby agree to waive the
current default on the Notes and to extend the maturity date thereof as set
forth herein.
3. Amendment. Section 2 is amended as follows: the term "June
30, 1996" shall be replaced by the term "November 30, 1996."
4. Construction of Waiver. The Note Agreement shall be deemed
amended only to the extent set forth herein and remains in full force and
effect.
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16
5. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Second
Amendment to Unsecured Note and Stock Purchase Agreement to be duly executed as
of the day and year first above written.
BIOFACTORS, INC.
By: /s/ Xxxxxx X. Xxxx
---------------------------------
Xxxxxx X. Xxxx
Title: President and Chief Executive
Officer
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17
SIGNATURE PAGE TO SECOND AMENDMENT TO
UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
/s/ Xxxxxxx Dallas
------------------------------------------------
Xxxxxxx Dallas
/s/ Xxxxxxx Xxx
------------------------------------------------
Xxxxxxx Xxx
/s/ Xxxxxx Xxxxxx
------------------------------------------------
Xxxxxx Xxxxxx
/s/ Xxxx X. Xxxxxxxxx, Xx.
------------------------------------------------
Xxxx X. Xxxxxxxxx, Xx.
/s/ Xxxx Xxx
------------------------------------------------
Xxxx Xxx
/s/ Xxxxxxx X. Xxxxx, M.D.
------------------------------------------------
Xxxxxxx X. Xxxxx, M.D.
/s/ Xxxxxx X. Xxxxxxxx
------------------------------------------------
Xxxxxx X. Xxxxxxxx
/s/ Xxxx Xxxxx Xxxxxx
------------------------------------------------
Xxxx Xxxxx Xxxxxx
XXXXXXX XXXXXXXX AND XXXXXXX
XXXXXXXX AS JOINT TENANTS
/s/ Xxxxxxx Xxxxxxxx
------------------------------------------------
Xxxxxxx Xxxxxxxx
/s/ Xxxxxxx Xxxxxxxx
------------------------------------------------
Xxxxxxx Xxxxxxxx
/s/ Xxxxx Xxxxxxxx
------------------------------------------------
Xxxxx Xxxxxxxx
-14-
18
BIOFACTORS, INC.
THIRD AMENDMENT TO
UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
THIS THIRD AMENDMENT TO UNSECURED NOTE AND STOCK PURCHASE AGREEMENT
(this "Amendment") is entered into as of the 1st day of October, 1996, by and
among BioFactors, Inc., a Delaware corporation ("BioFactors" or the "Company")
and the parties named on the signature pages hereto (all of such parties other
than the Company, collectively, the "Majority Holders") and amends that certain
Unecured Note and Stock Purchase Agreement dated as of February 1, 1996, by and
among the Company and the Purchasers named therein, as previously amended (the
"Note Agreement").
RECITALS
WHEREAS, the Majority Holders are the holders of unsecured promissory
notes of the Company (the "Notes") and shares (the "Shares") of common stock of
the Company (the "Common Stock"), $0.01 par value per share, issued pursuant to
the Note Agreement and, collectively, are the holders of Notes representing in
excess of fifty percent of the aggregate principal amount of all the Notes
outstanding as of the date hereof and, pursuant to Section 8.7 of the Note
Agreement, can bind each holder of Notes or Shares outstanding as of the date of
this Agreement;
WHEREAS, the Company has entered into a letter of intent with Xxxxxxxxx
Xxxx & Co. ("Xxxxxxxxx Xxxx"), providing for underwriting and financial advisory
services (the "Underwriting");
WHEREAS, as a condition precedent to the Underwriting, the Company is
required to enter into a definitive agreement with Voice Plus, Inc., a
California corporation ("Voice Plus"), for the formation of a holding company
("Registrant") and the merger of each of BioFactors (the "BFI Merger") and Voice
Plus with and into separate, wholly-owned subsidiaries of Registrant,
concurrently with Xxxxxxxxx Xxxx'x Underwriting of the initial public offering
of Registrant's securities pursuant to a registration statement filed under the
Securities Act of 1933 (the "IPO");
WHEREAS, upon the consummation of the BFI Merger, the Company's
stockholders, including the Majority Holders, are to receive shares of common
stock of Registrant ("Registrant Common Stock") in exchange for the BioFactors
Common Stock held by them in a three-for-four (three shares of common stock of
Registrant for every four shares of BioFactors Common Stock) conversion, or such
other ratio as Xxxxxxxxx Xxxx may determine is necessary;
WHEREAS, as a further condition precedent to the Underwriting, the
Company is required to enter into agreements amending the terms of outstanding
securities including, in particular, this Amendment providing for the consent of
the Majority Holders (a) to extend the Maturity date of the Notes to provide
additional time to accomplish the IPO, (b) to effect the mandatory conversion at
the IPO of all accrued interest on the Notes into common stock of Registrant,
(c) to amend and coordinate the registration rights granted in connection with
the Shares and certain other shares of its Common Stock and securities
convertible into or exercisable for its Common Stock, and (d) to effect certain
other amendments to the Note Agreement;
19
WHEREAS, as consideration for the agreements herein, the Company will
cause Registrant to issue warrants to holders of the Notes; and
WHEREAS, the Company and the Majority Holders desire to enter into this
Amendment to facilitate the Underwriting, it being acknowledged that the
Underwriting will be of substantial benefit to the Company and to the Majority
Holders.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the following
mutual covenants and agreements, the parties hereby agree as follows:
10. Definitions. All capitalized terms used herein and not otherwise
defined shall have the meanings given such terms in the Note Agreement.
11. Amendments. The Majority Holders hereby agree to amend the Note
Agreement as follows:
a. Authorized Issuance. Section 1.1(a) is amended by replacing
$300,000 with $315,000, such amount being the authorized aggregate original
principal amount of Notes issued pursuant to the Note Agreement and Section
4.1(a) is amended by replacing 90,000 with 94,500, such amount being the
authorized amount of Shares issued.
b. Maturity Date Extension. Section 2 of the Note Agreement is
hereby amended in its entirety, as follows:
"2. Maturity Date. The Notes shall mature and become due and payable in
full at the close of business on March 31, 1997 (the "Maturity Date")."
c. Prepayment and Conversion of Accrued Interest. Section 3 of the
Note Agreement is hereby amended in its entirety, as follows:
"3. Prepayment and Conversion of Accrued Interest. In the event the IPO
(defined below) is consummated prior to the Maturity Date, the
principal of the Notes shall be paid in full within five business days
of the receipt by Registrant (defined below) of the proceeds of the IPO
and all accrued interest on the Notes calculated through the IPO
closing date shall be converted into common stock of Registrant at a
conversion price equal to the price per share to the public in the IPO
(the "IPO Price"). In connection with such conversion, no fractional
shares of common stock shall be issued; instead, the number of shares
of common stock otherwise issuable will be rounded up to the next whole
share."
d. Registration Rights. Addendum A (which set forth the former
registration rights) is hereby deleted in its entirety. Section 4.2 of the Note
Agreement is hereby amended in its entirety, as follows:
-2-
20
"4.2 Planned Initial Public Offering; Registration Rights.
(a) The term "IPO" as used herein shall mean the proposed initial
public offering of the Company's securities, or the securities of a
holding company formed to hold the capital stock of BioFactors (such
entity, whether the Company or a holding company, being referred to
herein as, the "Registrant"), pursuant to an effective registration
statement filed under the Securities Act of 1933, as amended. The
undersigned understands and agrees that there can be no assurances that
a registration statement will be filed or, if filed, will be declared
effective by the Securities and Exchange Commission (the "Commission")
or, if the registration statement is declared effective by the
Commission, that the Registrant will be able to consummate such IPO.
(b) Registration Rights. Upon the execution of the Registration
Rights Agreement, substantially in the form attached hereto as EXHIBIT
B (the "Rights Agreement"), the Purchasers will become parties to the
Rights Agreement and the Shares, and any shares of common stock
issuable upon the the exercise or conversion of any securities issued
pursuant to this Agreement, shall become subject thereto."
3. Automatic Conversion. The Majority Holders hereby consent to the
automatic conversion upon the consummation of the IPO of all accrued interest on
the Notes, at a conversion price and calculated as set forth in Section 3 of the
Note Agreement, into common stock of the Registrant.
4. Issuance of Additional Warrants. In consideration of the agreements
herein, the Company hereby agrees that, upon the closing of the IPO, the payment
of the principal of the Notes and the conversion of the accrued interest
thereon, the Company shall, for no additional monetary consideration, cause the
Registrant to issue and deliver to each holder of Notes, a warrant to purchase
seventy-five (75) shares of Registrant common stock (the "Warrant Shares") for
each One Thousand Dollars ($1,000) in original principal amount of such holder's
Notes at an exercise price equal to 120% of the IPO Price (the "Warrants").
5. Proxy. The undersigned hereby irrevocably appoints Xxxx Xxxxx as
the undersigned's attorney and proxy, with full power of substitution, to vote
or to consent in writing in lieu of a vote or meeting with respect to all of the
Shares held by the undersigned which the undersigned is entitled to vote at any
meeting of stockholders (whether annual or special and whether or not an
adjourned meeting) of the Company, or pursuant to written action taken in lieu
of any such meeting or otherwise, in such manner as to cause the BFI Merger and
any agreement effecting the BFI Merger to be approved. This proxy is
irrevocable, is coupled with an interest sufficient in law to support an
irrevocable proxy and is granted in consideration of and as an inducement to
cause the Company to issue the Warrants. In connection with giving this proxy,
the undersigned understands and agrees that the BFI Merger effectively will
cause a reverse split of the Company's capital stock in that every four (4)
shares of BioFactors Common Stock issued and outstanding or held in treasury
immediately prior to the effective time of the BFI Merger shall, automatically
and without any action of the part of the respective holders thereof, be
converted into approximately three shares of Registrant Common Stock (or such
other number of shares as Xxxxxxxxx Xxxx and the Company shall determine).
-3-
21
6. Construction of Waiver. The Note Agreement shall be deemed amended
only to the extent set forth herein and remains in full force and effect.
7. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which together shall constitute one and the same instrument.
[The remainder of this page intentionally left blank.]
-4-
22
IN WITNESS WHEREOF, the parties hereto have caused this THIRD AMENDMENT
TO UNSECURED NOTE AND STOCK PURCHASE AGREEMENT to be duly executed as of the day
and year first above written.
BIOFACTORS, INC.
By: /s/ Xxxxxx X. Xxxx
----------------------------------------
Xxxxxx X. Xxxx
Title: President & CEO
HOLDER:
/s/ Xxxxxxx Xxx
--------------------------------------------
(Signature)
Xxxxxxx Xxx
--------------------------------------------
(Print Name)
/s/ Xxxx Xxxxxxxxx
--------------------------------------------
(Signature)
Xxxx Xxxxxxxxx
--------------------------------------------
(Print Name)
/s/ Xxxx X. Xxxxxx
--------------------------------------------
(Signature)
Xxxx X. Xxxxxx
--------------------------------------------
(Print Name)
XXXXXXX XXXXXXXX AND XXXXXXX XXXXXXXX AS
JOINT TENANTS
/s/ Xxxxxxx Xxxxxxxx
--------------------------------------------
(Signature)
Xxxxxxx Xxxxxxxx
--------------------------------------------
(Print Name)
/s/ Xxxxxxx Xxxxxxxx
--------------------------------------------
(Signature)
Xxxxxxx Xxxxxxxx
--------------------------------------------
(Print Name)
/s/ Xxxxx Xxxxxxxx
--------------------------------------------
(Signature)
Xxxxx Xxxxxxxx
--------------------------------------------
(Print Name)
/s/ Xxxxxxx X. Xxxxx
--------------------------------------------
(Signature)
Xxxxxxx X. Xxxxx
--------------------------------------------
(Print Name)
/s/ Xxxxxxx Dallas
--------------------------------------------
(Signature)
Xxxxxxx Dallas
--------------------------------------------
(Print Name)
/s/ Xxxx Xxx
--------------------------------------------
(Signature)
Xxxx Xxx
--------------------------------------------
(Print Name)
/s/ Ram Xxxxxx
--------------------------------------------
(Signature)
Ram Xxxxxx
--------------------------------------------
(Print Name)
/s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------
(Signature)
Xxxxxx X. Xxxxxxxx
--------------------------------------------
(Print Name)
/s/ Xxxxx X. Twarilosz
--------------------------------------------
(Signature)
Xxxxx X. Twarilosz
--------------------------------------------
(Print Name)
-5-
23
EXHIBIT A
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN
EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144
PROMULGATED UNDER THE ACT.
BIOFACTORS, INC.
UNSECURED PROMISSORY NOTE
$__________ No. ________
February 1, 1996
FOR VALUE RECEIVED, the undersigned, BIOFACTORS, INC., a
Delaware corporation ("Maker"), hereby promises to pay to the order of
______________, or registered assigns ("Holder") at such place as the Holder
may from time to time designate in writing, the principal sum of
____________________ THOUSAND DOLLARS ($___________), and to pay simple
interest on the unpaid balance of said principal from the date hereof through
maturity at the rate of ten percent (10%) per annum.
1. Maturity.
(a) Principal and accrued interest under this
Note shall be due and payable at the Maturity Date. If payment of the principal
amount hereof or interest accrued thereon is not made within five (5) days of
the Maturity Date, then interest shall accrue on such unpaid amount from the
date of nonpayment to the date of payment at the rate of 18% per annum
thereafter. Interest shall be calculated on the basis of a 365-day year for the
actual number of days elapsed.
(b) Principal and interest payments hereunder
shall be made in money of the United States of America, lawful at such times
for the satisfaction of public and private debts.
2. Prepayment. The Company may prepay this note in
whole at any time, or in part from time to time, without penalty or premium,
upon thirty (30) days' written notice to the Holder. Each partial prepayment
shall first be applied to interest accrued through the date of prepayment and
then to principal.
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24
3. Note Agreement. This Note is the Maker's "Note" and
is issued pursuant to and entitled to the benefit of that certain Unsecured
Note and Stock Purchase Agreement dated as of February 1, 1996, between Maker
and the Purchasers named therein, as the same may be amended, modified or
supplemented from time to time as permitted thereby (as amended, the "Note
Agreement"). Capitalized terms used herein without definition shall have the
meaning set forth in the Note Agreement.
4. Registered Note. This Note is a registered Note and
is transferable only by surrender thereof at the principal offices of the
Company, duly endorsed or accompanied by a written instrument of transfer duly
executed by the registered holder of this Note or his attorney duly authorized
in writing. The Maker may treat the person whose name appears in the Note
register as the owner hereof for the purpose of receiving payment as herein
provided. Transfers are subject to the restrictions set forth in the Note
Agreement.
5. Repayment Rights. Pursuant to paragraph 3 of the
Note Agreement.
6. Waiver of Demand, Protest, etc. Maker hereby waives
diligence, presentment, demand, protest and notice of any kind whatsoever.
Maker promises to pay costs of collection and reasonable attorneys' fees if
default is made in the payment of this Note. The right to plead any and all
statutes of limitation as a defense to this Note or to any agreement to pay the
same, is hereby expressly waived by the undersigned to the full extent
permitted by law.
7. Notice. Any notice required or permitted hereunder
shall be given in accordance with the Note Agreement.
Governing Law. THE MAKER AND THE HOLDER AGREE THAT
THIS NOTE AND THE LEGAL RELATIONS BETWEEN THE MAKER AND THE HOLDER, AND ALL
RIGHTS AND OBLIGATIONS HEREUNDER, INCLUDING MATTERS OF CONSTRUCTION, VALIDITY,
AND PERFORMANCE, SHALL BE GOVERNED BY AND INTERPRETED, CONSTRUED, APPLIED, AND
ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF COLORADO WITHOUT REFERENCE
TO THE LAW OF ANOTHER JURISDICTION.
IN WITNESS WHEREOF, the undersigned has caused this note to be
executed as this ________ day of February, 1996.
MAKER:
BIOFACTORS, INC.
(Corporate Seal) By:
------------------------------------
Xxxxxxx Xxxx
Its: Vice President and Secretary
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