EXHIBIT 4.1
STOCK PURCHASE AGREEMENT
Conceptus, Inc.
0000 Xxxxxx Xxxxxx
Xxx Xxxxxx, XX 00000
Ladies & Gentlemen:
The undersigned,_____________________ (the "Investor"), hereby confirms
its agreement with you as follows:
1. This Stock Purchase Agreement (the "Agreement") is made effective as of
February ___, 2004 between Conceptus, Inc., a Delaware corporation (the
"Company"), and the Investor.
2. The Company has authorized the issuance and sale of up to 3,000,000
shares (the "Shares") of common stock of the Company, $0.003 par value per share
(the "Common Stock"), subject to adjustment by the Company's Board of Directors,
to certain investors in a private placement (the "Offering").
3. The Company and the Investor agree that the Investor will purchase from
the Company and the Company will issue and sell to the Investor ____________
Shares, for a purchase price of $__________ per share, or an aggregate purchase
price of $__________ , pursuant to the Terms and Conditions for Purchase of
Shares attached hereto as Annex I and incorporated herein by reference as if
fully set forth herein. Unless otherwise requested by the Investor, certificates
representing the Shares purchased by the Investor will be registered in the
Investor's name and address as set forth below.
4. The Investor represents that, except as set forth below, (a) it has had
no position, office or other material relationship within the past three years
with the Company or its affiliates, (b) neither it, nor any group of which it is
a member or to which it is related, beneficially owns (including the right to
acquire or vote) any securities of the Company and (c) it has no direct or
indirect affiliation or association with any NASD member. Exceptions:
(If no exceptions, write "none." If left blank, response will be deemed
to be "none.")
Please confirm that the foregoing correctly sets forth the agreement
between us by signing in the space provided below for that purpose.
___________________________________________
"INVESTOR"
By: _______________________________________
Print Name: _______________________________
Title: ____________________________________
Address: __________________________________
Tax ID No.: _______________________________
Contact name: _____________________________
Telephone: ________________________________
Name in which shares should be registered
(if different):____________________________
[SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]
AGREED AND ACCEPTED:
-------------------
CONCEPTUS, INC.
By: ______________________________
Xxxx Xxxxxxxxxx
President and Chief Executive Officer
[SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]
ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF SHARES
1. Authorization and Sale of the Shares. Upon the terms and
subject to the conditions of this Agreement, the Company has authorized the sale
of up to 3,000,000 Shares. The Company reserves the right to increase or
decrease this number.
2. Agreement to Sell and Purchase the Shares; Subscription Date.
2.1 At the Closing (as defined in Section 3), the Company
will sell to the Investor, and the Investor will purchase from the Company, upon
the terms and subject to the conditions hereinafter set forth, the number of
Shares set forth on the signature page hereto at the purchase price set forth on
such signature page.
2.2 The Company is entering into this same form of Stock
Purchase Agreement with certain other investors (the "Other Investors")
effective as of the date hereof (the "Subscription Date") and expects to
complete sales of Shares to them. (The Investor and the Other Investors are
hereinafter sometimes collectively referred to as the "Investors," and this
Agreement and the Stock Purchase Agreements executed by the Other Investors are
hereinafter sometimes collectively referred to as the "Agreements.")
3. Delivery of the Shares at Closing. The completion of the
purchase and sale of the Shares (the "Closing") shall occur (the "Closing Date")
on the third business day after the Subscription Date (or upon such earlier date
as the Company and the Investors shall agree), at the offices of the Company's
counsel. At the Closing, the Company shall deliver to the Investor one or more
stock certificates representing the number of Shares set forth on the signature
page hereto, each such certificate to be registered in the name of the Investor
or, if so indicated on the signature page hereto, in the name of a nominee
designated by the Investor. The Company's obligation to issue the Shares to the
Investor shall be subject to the following conditions, any one or more of which
may be waived by the Company: (a) receipt by the Company of a certified or
official bank check or wire transfer of funds in the full amount of the purchase
price for the Shares being purchased hereunder as set forth on the signature
page hereto; provided, however, that any Investor subject to the Investment
Company Act of 1940, as amended (the "Investment Act"), shall not be required to
deliver the applicable purchase price prior to the physical delivery and review
by Investor of the certificates representing the Shares purchased by such
Investor, in compliance with the provisions of the Investment Act; (b)
completion of the purchases and sales under the Agreements with the Other
Investors; and (c) the accuracy of the representations and warranties made by
the Investors and the fulfillment of those undertakings of the Investors to be
fulfilled prior to the Closing. The Investor's obligation to purchase the Shares
shall be subject to the following conditions, any one or more of which may be
waived by the Investor (provided that no such waiver shall be deemed given
unless in writing and executed by the Investor): (a) receipt by the Investor of
a counter-signed copy of this Agreement executed by the Company; (b) receipt by
the Investor of one or more stock certificates representing the number of Shares
set forth on the signature page hereto; (c) receipt by the Investor of an
opinion letter, dated as of the Closing Date, from Xxxxxx & Xxxxxxx LLP, counsel
to the Company, in form and substance reasonably satisfactory to the Investor;
(d) the accuracy of the
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representations and warranties made by the Company and the fulfillment of those
undertakings of the Company to be fulfilled prior to the Closing; (e) on the
Closing Date, no legal action, suit or proceeding shall be pending or threatened
which seeks to restrain or prohibit the transactions contemplated by the
Agreements; (f) the Company shall have delivered to the Investors its
certificate, dated the Closing Date, duly executed by its Chief Executive
Officer to the effect set forth in clause (d) above; (g) the receipt by the
Investors of a certificate, dated the Closing Date, of the Secretary or
Assistant Secretary of the Company certifying (i) the certificate of
incorporation and bylaws of the Company as in effect on the Closing Date, (ii)
all resolutions of the board of directors (and committees thereof) of the
Company relating to the Agreements and the transactions contemplated thereby and
(iii) the incumbency of all officers of the Company executing the Agreements and
any other agreement or document contemplated thereby.
4. Representations, Warranties and Covenants of the Company. The
Company hereby represents and warrants to, and covenants with, the Investor, as
follows:
4.1 Organization. Each of the Company and its
Subsidiaries is duly organized and validly existing in good standing under the
laws of the jurisdiction of its organization. Each of the Company and its
Subsidiaries (as defined in Rule 405 under the Securities Act of 1933, as
amended (the "Securities Act")) has full power and authority to own, operate and
occupy its properties and to conduct its business as presently conducted and is
registered or qualified to do business and in good standing in each jurisdiction
in which it owns or leases property or transacts business and where the failure
to be so qualified would have a material adverse effect upon the financial
condition or business, operations, assets or prospects of the Company and its
Subsidiaries, considered as one enterprise, and no proceeding has been
instituted in any such jurisdiction, revoking, limiting or curtailing, or
seeking to revoke, limit or curtail, such power and authority or qualification.
4.2 Due Authorization. The Company has all requisite
power and authority to execute, deliver and perform its obligations under the
Agreements, and the Agreements have been duly authorized and validly executed
and delivered by the Company and constitute legal, valid and binding agreements
of the Company enforceable against the Company in accordance with their terms,
except as rights to indemnity and contribution may be limited by state or
federal securities laws or the public policy underlying such laws, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.3 Non-Contravention. The execution and delivery of the
Agreements, the issuance and sale of the Shares to be sold by the Company under
the Agreements, the fulfillment of the terms of the Agreements and the
consummation of the transactions contemplated thereby will not (A) conflict with
or constitute a violation of, or default (with or without the giving of notice
or the passage of time or both) under, (i) any material bond, debenture, note or
other evidence of indebtedness, or under any material lease, indenture,
mortgage, deed of trust, loan agreement, joint venture or other agreement or
instrument to which the Company or any Subsidiary is a party or by which it or
any of its Subsidiaries or their respective properties are bound, (ii) the
charter, by-laws or
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other organizational documents of the Company or any Subsidiary, or (iii) any
law, administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority applicable to the Company or any
Subsidiary or their respective properties, or (B) result in the creation or
imposition of any lien, encumbrance, claim, security interest or restriction
whatsoever upon any of the material properties or assets of the Company or any
Subsidiary or an acceleration of indebtedness pursuant to any obligation,
agreement or condition contained in any material bond, debenture, note or any
other evidence of indebtedness or any material indenture, mortgage, deed of
trust or any other agreement or instrument to which the Company or any
Subsidiary is a party or by which any of them is bound or to which any of the
property or assets of the Company or any Subsidiary is subject. No consent,
approval, authorization or other order of, or registration, qualification or
filing with, any regulatory body, administrative agency, self-regulatory
organization, stock exchange or market, or other governmental body in the United
States is required for the execution and delivery of the Agreements and the
valid issuance and sale of the Shares to be sold pursuant to the Agreements,
other than such as have been made or obtained, and except for any securities
filings required to be made under federal or state securities laws.
4.4 Reporting Status. The Company has filed in a timely
manner all documents that the Company was required to file under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), during the 12 months
preceding the date of this Agreement. The following documents complied in all
material respects with the SEC's requirements as of their respective filing
dates, and the information contained therein as of the date thereof did not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein in
light of the circumstances under where they were made not misleading, except to
the extent that information contained in any such document has been revised or
superseded by a later filed SEC Document (as defined below):
(i) The Company's Annual Report on Form 10-K for the year
ended December 31, 2002, including the exhibits
thereto (the "Form 10-K"); and
(ii) all other documents, including the exhibits thereto,
filed by the Company with the SEC since December 31,
2002 pursuant to the reporting requirements of the
Exchange Act (together with the Form 10-K, the "SEC
Documents").
The SEC Documents (together with press releases and other
documents made publicly available by the Company), when taken together as a
whole, as of the date hereof, do not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein in light of the circumstances under which they
were made not misleading.
4.5 Capitalization. As of December 31, 2003, the
authorized capital stock of the Company consists of 50,000,000 shares of Common
Stock and 3,000,000 shares of preferred stock, par value $.003 per share, of the
Company (the "Preferred Stock"). As of December 31, 2003, there were
approximately (i) 21,796,937 shares of Common Stock issued and outstanding, (ii)
no shares of Preferred Stock issued and outstanding, (iii) 4,558,414 shares of
Common Stock reserved for issuance under the Company's 2001 Equity Incentive
Plan, 1993 Stock Plan and 1995 Directors' Option Plan, including 4,317,126
shares issuable upon exercise of outstanding stock options issued
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by the Company to current or former employees, consultants and directors of the
Company and its Subsidiaries, (iv) an aggregate of 8,034 shares of Common Stock
reserved for issuance pursuant to the Company's 1995 Employee Stock Purchase
Plan, a portion of which are issued and outstanding, and (v) no other shares or
options, warrants or other rights to acquire shares of capital stock of the
Company or securities convertible into capital stock of the Company. The Company
is, directly or indirectly, the registered and beneficial owner of all of the
outstanding shares of capital stock of each of its Subsidiaries. All outstanding
shares of Common Stock are duly authorized, validly issued, fully paid and
nonassessable, free from any liens or any other encumbrances created by the
Company with respect to the issuance and delivery thereof and not subject to
preemptive rights. Other than as disclosed in the SEC Documents, there are no
outstanding rights, options, warrants, preemptive rights, rights of first
refusal agreements, commitments or similar rights for the purchase or
acquisition from the Company of any securities of the Company. The Shares to be
sold pursuant to the Agreements have been duly authorized, and when issued and
paid for in accordance with the terms of the Agreements will be duly and validly
issued, fully paid and nonassessable, free and clear of all pledges, liens,
encumbrances and other restrictions (other than those arising under federal or
state securities laws as a result of the private placement of the Shares to the
Investors). No preemptive right, co-sale right, right of first refusal or other
similar right exists with respect to the Shares or the issuance and sale
thereof. No further approval or authorization of any stockholder, the Board of
Directors of the Company or others is required for the issuance and sale of the
Shares. Except as set forth in the SEC Documents, no holder of any of the
securities of the Company or any of its Subsidiaries has any rights ("demand,"
"piggyback" or otherwise) to have such securities registered by reason of the
intention to file, filing or effectiveness of a Registration Statement (as
defined in Section 7.1 hereof).
4.6 Legal Proceedings. There is no material legal or
governmental proceeding pending or, to the knowledge of the Company, threatened
to which the Company or any Subsidiary or any officer or director of the Company
or any Subsidiary in their capacity as such officer or director is or may be a
party or of which the business or property of the Company or any Subsidiary is
subject that is not disclosed in the SEC Documents. There is no action, suit,
proceeding, inquiry or investigation before or by any court, public board or
body (including, without limitation, the SEC) pending or, to the knowledge of
the Company, threatened against or affecting the Company or any of its
Subsidiaries wherein an unfavorable decision, ruling or finding could adversely
affect the validity or enforceability of, or the authority or ability of the
Company to perform its obligations under the Agreements.
4.7 No Violations. Neither the Company nor any Subsidiary
is in violation of its charter, bylaws, or other organizational document, or in
violation of any law, administrative regulation, ordinance or order of any court
or governmental agency, arbitration panel or authority applicable to the Company
or any Subsidiary, which violation, individually or in the aggregate, would be
reasonably likely to have a material adverse effect on the business, operations,
assets or prospects or financial condition of the Company and its Subsidiaries,
considered as one enterprise, or is in default (and there exists no condition
which, with or without the passage of time or giving of notice or both, would
constitute a default) in any material respect in the performance of any bond,
debenture, note or any other evidence of indebtedness in any indenture,
mortgage, deed of trust or any other material agreement or instrument to which
the Company or any Subsidiary is a party or by which the Company or any
Subsidiary is bound or by which the properties of the Company or any
5
Subsidiary are bound, which would be reasonably likely to have a material
adverse effect upon the business, operations, assets or prospects or financial
condition of the Company and its Subsidiaries, considered as one enterprise. The
Company is in compliance with all provisions of the Xxxxxxxx-Xxxxx Act and the
rules and regulations promulgated thereunder and with all provisions of the
NASD, in each case as to which the Company is required to be in compliance.
4.8 Governmental Permits, Etc. With the exception of the
matters which are dealt with separately in Section 4.1, 4.4, 4.12 and 4.13, each
of the Company and its Subsidiaries has all necessary franchises, licenses,
certificates and other authorizations from any foreign, federal, state or local
government or governmental agency, department, or body that are currently
necessary for the operation of the business of the Company and its Subsidiaries
as currently conducted, except where the failure to currently possess could not
reasonably be expected to have a material adverse effect upon the business,
operations, assets or prospects or financial condition of the Company and its
Subsidiaries, considered as one enterprise.
4.9 Intellectual Property. Each of the Company and its
Subsidiaries owns or possesses sufficient rights to use all patents, patent
rights, trademarks, copyrights, licenses, inventions, trade secrets, trade names
and know-how (collectively, "Intellectual Property") that are necessary for the
conduct of its business as now conducted except where the failure to currently
own or possess would not have a material adverse effect on the financial
condition or business of the Company and its Subsidiaries considered as one
enterprise. Except as set forth in the SEC Documents, (i) neither the Company
nor any of its Subsidiaries has received any notice of, or has any knowledge of,
any infringement of asserted rights of a third party with respect to any
Intellectual Property that, individually or in the aggregate, would have a
material adverse effect on the financial condition or business, operations,
assets or prospects of the Company and its Subsidiaries considered as one
enterprise and (ii) neither the Company nor any of its Subsidiaries has received
any notice of any infringement rights by a third party with respect to any
Intellectual Property that, individually or in the aggregate, would have a
material adverse effect upon the business, operations, assets or prospects or
financial condition of the Company and its Subsidiaries, considered as one
enterprise.
4.10 Financial Statements. The financial statements of the
Company and the related notes thereto included in the SEC Documents present
fairly, in accordance with generally accepted accounting principles, the
financial position of the Company and its Subsidiaries as of the dates
indicated, and the results of its operations and cash flows for the periods
therein specified. Such financial statements (including the related notes) have
been prepared in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods therein specified, except
as set forth in the SEC Documents and subject in the case of unaudited financial
statements, to normal year-end audit adjustments.
4.11 No Material Adverse Change. Except as disclosed in
the SEC Documents, since September 30, 2003 there has not been (i) any material
adverse change in the financial condition, earnings or prospects of the Company
and its Subsidiaries considered as one enterprise nor has any material adverse
event occurred to the Company or its Subsidiaries, (ii) any material adverse
event affecting the Company or any of its Subsidiaries, (iii) any obligation,
direct or contingent, that is material to the Company and its Subsidiaries
considered as one enterprise, incurred by the Company, except obligations
incurred in the ordinary course of business, (iv) any
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dividend or distribution of any kind declared, paid or made on the capital stock
of the Company or any of its Subsidiaries, (v) any loss or damage (whether or
not insured) to the physical property of the Company or any of its Subsidiaries
which has been sustained which has a material adverse effect on the condition
(financial or otherwise), earnings, operations, business or business prospects
of the Company and its Subsidiaries considered as one enterprise or (vi) any
notice from or by the Securities and Exchange Commission and/or any other state
or federal securities regulatory agency, the NASD and/or the Nasdaq with respect
to (a) any investigation of the Company's activities or financial results, (b)
the Company's compliance with applicable laws, rules or regulations or (c)
issues regarding the continued trading of the Common Stock on the Nasdaq
National Market. Except as disclosed in the SEC Documents, neither the Company
nor any of its Subsidiaries has (i) sold, assigned, transferred, abandoned,
mortgaged, pledged or subjected to lien any of its material properties, tangible
or intangible, or rights under any material contract, permit, license, franchise
or other agreement or (ii) waived or cancelled any indebtedness or other
obligations owed to the Company or any such Subsidiary.
4.12 NASDAQ Listing. The Company's Common Stock is
registered pursuant to Section 12(g) of the Exchange Act and is listed on The
Nasdaq Stock Market, Inc. National Market (the "Nasdaq National Market"),
trading in the Common Stock has not been suspended, and the Company has taken no
action designed to, or likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act or de-listing the Common
Stock from the Nasdaq National Market, nor to the Company's knowledge is the
National Association of Securities Dealers, Inc. ("NASD") currently
contemplating terminating such listing. The Company and the Common Stock meet
the criteria for continued listing and trading on the Nasdaq National Market.
4.13 Listing of the Shares. The Company shall comply with
all requirements of the National Association of Securities Dealers, Inc. with
respect to the issuance of the Shares and the listing thereof on the Nasdaq
National Market. In furtherance thereof, the Company shall use its best efforts
to take such actions as may be necessary and as soon as practicable and in no
event later than 20 days after the Closing Date to file with the Nasdaq National
Market an application or other document required by the Nasdaq National Market
and pay all applicable fees when due for the listing of the Shares with the
Nasdaq National Market and shall provide evidence of such filing to the
Investors. The Company knows of no reason why the Shares will not be eligible
for listing on the Nasdaq National Market. Company stockholder approval for the
transactions contemplated by this Agreement will not be required.
4.14 No Manipulation of Stock. The Company has not taken
and will not, in violation of applicable law, take, any action designed to or
that might reasonably be expected to cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Shares.
4.15 S-3 Status. The Company meets the requirements for
the use of Form S-3 for the registration of the resale of the Shares by the
Investors and will use its best efforts to maintain S-3 status with the SEC
during the Registration Period (as defined in Section 7.1(c)).
4.16 Insurance. The Company maintains and will continue to
maintain insurance against loss or damage by fire or other casualty and such
other insurance, including, but not limited
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to, product liability insurance, in such amounts and covering such risks as is
reasonably adequate consistent with industry practice for the conduct of its
business and the value of its properties, all of which insurance is in full
force and effect.
4.17 Tax Matters. The Company has filed all material
federal, state and local income and franchise and other tax returns required to
be filed and has paid all taxes due in accordance therewith, and no tax
deficiency has been determined adversely to the Company which has had (nor does
the Company have any knowledge of any tax deficiency which, if determined
adversely to the Company, might have) a material adverse effect on the condition
(financial or otherwise), earnings, operations, business or prospects of the
Company and its Subsidiaries considered as one enterprise .
4.18 Investment Company. The Company is not an "investment
company" within the meaning of such term under the Investment Company Act of
1940 and the rules and regulations of the SEC thereunder.
4.19 No Registration. Assuming the accuracy of the
representations and warranties made by, and compliance with the covenants of,
the Investors in Section 5 hereof, no registration of the Shares under the
Securities Act is required in connection with the offer and sale of the Shares
by the Company to the Investors as contemplated by the Agreements.
4.20 Internal Accounting Controls. The Company and its
Subsidiaries maintain a system of internal accounting controls sufficient, in
the judgment of the Company's board of directors, to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with management's general or
specific authorization and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
4.21 Form D. The Company agrees to file one or more Forms
D with respect to the Shares on a timely basis as required under Regulation D
under the Securities Act to claim the exemption provided by Rule 506 of
Regulation D and to provide a copy thereof to the Investors and their counsel
promptly after such filing.
4.22 Certain Future Financings and Related Actions.
(a) The Company will not sell, offer to sell,
solicit offers to buy or otherwise negotiate in respect of any "security" (as
defined in the Securities Act) that is or could be integrated with the sale of
the Shares in a manner that would require the registration of the Shares under
the Securities Act.
(b) The Company shall not offer, sell, contract
to sell or issue (or engage any person to assist the Company in taking any such
action) any equity securities or securities convertible into, exchangeable for
or otherwise entitling the holder to acquire, any Common Stock
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during the period from the date of this Agreement to the effective date of the
Registration Statement; provided, however, that nothing in this Section 4.22(b)
shall prohibit the Company from issuing securities (v) to employees, directors,
officers, advisors or consultants of the Company; (w) upon exercise of
conversion, exchange, purchase or similar rights issued, granted or given by the
Company and outstanding as of the date of this Agreement; (x) pursuant to a
public offering underwritten on a firm commitment basis registered under the
Securities Act; (y) for the purpose of funding the acquisition of securities or
assets of any entity in a single transaction or a series of related
transactions; or (z) pursuant to a strategic partnership or alliance agreement,
loan agreement, equipment lease or similar commercial agreement (including
licensing and similar arrangements).
4.23 Use of Proceeds. The Company will use the net
proceeds from the sale of the Shares for working capital and other general
corporate purposes.
4.24 Disclosure. The Company confirms that neither it nor
any officers, directors or affiliates, has provided any of the Investors or
their agents or counsel with any information that constitutes or might
constitute material, nonpublic information. The Company understands and confirms
that each of the Investors will rely on the foregoing representations in
effecting transactions in securities of the Company. All disclosure provided by
the Company to the Investors regarding the Company, its business and the
transactions contemplated hereby furnished by or on the behalf of the Company
are true and correct in all material respects and do not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. To the Company's knowledge, no event
or circumstance has occurred or information exists with respect to the Company
or any of its Subsidiaries or its or their business, properties, operations or
financial conditions, which, under applicable law, rule or regulation, requires
public disclosure or announcement by the Company but which has not been so
publicly announced or disclosed.
4.25 Acknowledgment Regarding Investors' Purchase of
Securities. Based upon the assumption that the transactions contemplated by this
Agreement are consummated in all material respects in conformity with this
Agreement, the Company acknowledges and agrees that each of the Investors is
acting solely in the capacity of an arm's length purchaser with respect to this
Agreement and the transactions contemplated hereby. The Company further
acknowledges that no Investor is acting as a financial advisor or fiduciary of
the Company (or in any similar capacity) with respect to this Agreement and the
transactions contemplated hereby and any advice given by any Investor or any of
their respective representatives or agents in connection with this Agreement and
the transactions contemplated hereby and thereby is merely incidental to the
Investors' purchase of the Shares. The Company further represents to each
Investor that the Company's decision to enter into this Agreement has been based
solely on the independent evaluation of the transactions contemplated hereby by
the Company and its representatives.
4.26 Integration. The Company shall not, and shall use its
best efforts to ensure that none of its affiliates shall, sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in Section 2 of the Securities Act) that would be integrated with the
offer or sale of the Shares in a manner that would require the registration
under the Securities Act of the sale of the Shares to the Investors or that
would be integrated with the offer or sale of the Shares for purposes of the
rules and regulations of the Nasdaq National Market.
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4.27 Securities Laws Disclosure; Publicity. On the Closing
Date, the Company shall file a Current Report on Form 8-K with the Securities
and Exchange Commission (the "8-K Filing") describing the terms of the
transactions contemplated by this Agreement and including as exhibits to such
Current Report on Form 8-K this Agreement in the form required by the Exchange
Act. Thereafter, the Company shall timely file any filings and notices required
by the Securities and Exchange Commission, the NASD or Nasdaq National Market or
applicable law with respect to the transactions contemplated hereby and provide
copies thereof to the Investors promptly after filing. The Company shall not
publicly disclose the name of any Investor, or include the name of any Investor
in any press release without the prior written consent of such Investor;
provided, however, that the Investor acknowledges and agrees that the name of
such Investor shall be disclosed in the Registration Statement.
5. Representations, Warranties and Covenants of the Investor.
5.1 The Investor represents and warrants to, and
covenants with, the Company that: (i) the Investor is an "accredited investor"
as defined in Regulation D under the Securities Act and the Investor has the
knowledge, sophistication and experience necessary to make, and is qualified to
make decisions with respect to, investments in shares presenting an investment
decision like that involved in the purchase of the Shares, including investments
in securities issued by the Company and investments in comparable companies, and
has requested, received, reviewed and considered all information it deemed
relevant in making an informed decision to purchase the Shares; (ii) the
Investor is acquiring the number of Shares set forth on the signature page
hereto for its own account for investment only and with no present intention of
distributing any of such Shares in violation of the Securities Act or any
arrangement or understanding with any other persons regarding the distribution
of such Shares; (iii) the Investor will not, directly or indirectly, offer,
sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy,
purchase or otherwise acquire or take a pledge of) any of the Shares except in
compliance with the Securities Act, applicable state securities laws and the
respective rules and regulations promulgated thereunder; (iv) the Investor has
filled in all requested information on the signature page hereto for use in
preparation of the Registration Statement and the answers thereto are true and
correct as of the date hereof and will be true and correct as of the Closing
Date; (v) the Investor will notify the Company promptly of any change in any of
such information until such time as the Investor has sold all of its Shares or
until the Company is no longer required to keep the Registration Statement
effective; and (vi) the Investor has, in connection with its decision to
purchase the number of Shares set forth on the signature page hereto, relied
only upon the SEC Documents, other publicly available information and the
representations and warranties of the Company contained herein. The Investor
understands that its acquisition of the Shares has not been registered under the
Securities Act or registered or qualified under any state securities law in
reliance on specific exemptions therefrom, which exemptions may depend upon,
among other things, the bona fide nature of the Investor's investment intent as
expressed herein.
5.2 The Investor acknowledges that the Company has
represented that no action has been or will be taken in any jurisdiction outside
the United States by the Company that would permit an offering of the Shares, or
possession or distribution of offering materials in connection with the issue of
the Shares, in any jurisdiction outside the United States where action for that
purpose is required. If the Investor is located or domiciled outside the United
States it agrees to
10
comply with all applicable laws and regulations in each foreign jurisdiction in
which it purchases, offers, sells or delivers Shares or has in its possession or
distributes any offering material, in all cases at its own expense.
5.3 The Investor hereby covenants with the Company not to
make any sale of the Shares without complying with the provisions of this
Agreement, including Section 7.2 hereof, provided that the Company complies with
its obligations under Section 7.1, without effectively causing the prospectus
delivery requirement under the Securities Act to be satisfied, if applicable,
and the Investor acknowledges that the certificates evidencing the Shares will
be imprinted with a legend that prohibits their transfer except in accordance
therewith. The Investor acknowledges that there may occasionally be times when
the Company, based on the advice of its counsel, determines that, subject to the
limitations of Section 7.2, it must suspend the use of the Prospectus forming a
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the SEC or until the Company has amended or supplemented such Prospectus.
5.4 The Investor further represents and warrants to, and
covenants with, the Company that (i) the Investor has full right, power,
authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement and (ii) this
Agreement constitutes a valid and binding obligation of the Investor enforceable
against the Investor in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the indemnification and contribution agreements
of the Investors herein may be legally unenforceable.
5.5 Investor will not, prior to the effectiveness of the
Registration Statement, sell, offer to sell, solicit offers to buy, dispose of,
loan, pledge or grant any right with respect to (collectively, a "Disposition")
the Shares in violation of the Securities Act, nor will Investor engage in any
hedging or other transaction which is designed to or could reasonably be
expected to lead to or result in a Disposition of Shares by the Investor or any
other person or entity in violation of the Securities Act.
5.6 The Investor understands that nothing in this
Agreement or any other materials presented to the Investor in connection with
the purchase and sale of the Shares constitutes legal, tax or investment advice.
The Investor has consulted such legal, tax and investment advisors as it, in its
sole discretion, has deemed necessary or appropriate in connection with its
purchase of Shares.
6. Survival of Representations, Warranties and Agreements.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Shares being purchased and the payment therefor.
11
7. Registration of the Shares; Compliance with the Securities
Act.
7.1 Registration Procedures and Expenses. The Company
shall:
(a) subject to receipt of necessary information
from the Investors, use its best efforts to prepare and file with the SEC,
within 22 days after the Closing Date, a registration statement (the
"Registration Statement") on Form S-3 to enable the resale of the Registrable
Shares (as defined below) by the Investors on a delayed or continuous basis
under Rule 415 of the Securities Act. "Registrable Shares" means (a) all shares
of Common Stock purchased in the Offering, (b) Penalty Shares (as defined
below), if any, and (c) any shares of capital stock issued or issuable, from
time to time, upon any reclassification, share combination, share subdivision,
stock split, share dividend, merger, consolidation or similar transaction or
event or otherwise as a distribution on, in exchange for or with respect to any
of the foregoing, in each case held at the relevant time by an Investor;
(b) use commercially reasonable best efforts,
subject to receipt of necessary information from the Investors, to cause the
Registration Statement to become effective within 90 days after the Closing
Date;
(c) use its best efforts to prepare and file
with the SEC such amendments and supplements to the Registration Statement and
the Prospectus used in connection therewith and take all such other actions as
may be necessary to keep the Registration Statement current and effective for a
period (the "Registration Period") not exceeding, with respect to each
Investor's Registrable Shares, the earlier of (i) the second anniversary of the
Closing Date, (ii) the date on which the Investor may sell all Shares then held
by the Investor without restriction by the volume limitations of Rule 144(e) of
the Securities Act, and (iii) such time as all Registrable Shares held by such
Investor have been sold (A) pursuant to a registration statement, (B) to or
through a broker or dealer or underwriter in a public distribution or a public
securities transaction, and/or (C) in a transaction exempt from the registration
and prospectus delivery requirements of the Securities Act under Section 4(1)
thereof so that all transfer restrictions and restrictive legends with respect
thereto, if any, are removed upon the consummation of such sale.
(d) promptly furnish to the Investor with
respect to the Shares registered under the Registration Statement such number of
copies of the Registration Statement, Prospectuses and Preliminary Prospectuses
in conformity with the requirements of the Securities Act and such other
documents as the Investor may reasonably request, in order to facilitate the
public sale or other disposition of all or any of the Shares by the Investor;
(e) promptly take such action as may be
necessary to qualify, or obtain, an exemption for the Registrable Shares under
such of the state securities laws of United States jurisdictions as shall be
necessary to qualify, or obtain an exemption for, the sale of the Registrable
Shares in states specified in writing by the Investor; provided, however, that
the Company shall not be required to qualify to do business or consent to
service of process in any jurisdiction in which it is not now so qualified or
has not so consented;
12
(f) bear all expenses in connection with the
procedures in paragraph (a) through (e) of this Section 7.1 and the registration
of the Shares pursuant to the Registration Statement, regardless of whether a
Registration Statement becomes effective, including without limitation: (i) all
registration and filing fees and expenses (including filings made with the
NASD); (ii) fees and expenses of compliance with federal securities and state
"blue sky" or securities laws; (iii) expenses of printing (including printing
certificates for the Registrable Securities and Prospectuses), messenger and
delivery services and telephone; (iv) all application and filing fees in
connection with listing the Registrable Securities on a national securities
exchange or automated quotation system pursuant to the requirements hereof; and
(v) all fees and disbursements of counsel of the Company and independent
certified public accountants of the Company (including the expenses of any
special audit and "cold comfort" letters required by or incident to such
performance); provided, however, that each Investor shall be responsible for
paying the underwriting commissions or brokerage fees, and taxes of any kind
(including, without limitation, transfer taxes) applicable to any disposition,
sale or transfer of such Investor's Registrable Securities. The Company shall,
in any event, bear its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit, rating agency fees and the
fees and expenses of any person, including special experts, retained by the
Company;
(g) advise the Investors, within two business
days by e-mail, fax or other type of communication, and, if requested by such
person, confirm such advice in writing: (i) after it shall receive notice or
obtain knowledge of the issuance of any stop order by the SEC delaying or
suspending the effectiveness of the Registration Statement or of the initiation
or threat of any proceeding for that purpose, or any other order issued by any
state securities commission or other regulatory authority suspending the
qualification or exemption from qualification of such Registrable Securities
under state securities or "blue sky" laws; and it will promptly use its best
efforts to prevent the issuance of any stop order or other order or to obtain
its withdrawal at the earliest possible moment if such stop order or other order
should be issued; (ii) when the Prospectus or any Prospectus Supplement or
post-effective amendment has been filed, and, with respect to the Registration
Statement or any post-effective amendment thereto, when the same has become
effective; and (iii) after the Company shall receive notice or obtain knowledge
of the existence of any fact or the happening of any event that makes any
statement of a material fact made in the Registration Statement, the Prospectus,
any amendment or supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to or changes in
the Registration Statement or the Prospectus in order to make the statements
therein not misleading;
(h) otherwise use its best efforts to comply
with all applicable rules and regulations of the SEC;
(i) use its best efforts to maintain the
quotation of the Registrable Shares on the Nasdaq National Market; and
(j) use commercially reasonable best efforts to
take all other steps necessary to effect the registration of the Registrable
Shares contemplated hereby and to enable the Investors to sell the Shares under
Rule 144.
13
(k) The Company further agrees that, in the
event that the Registration Statement has not (i) been filed with the SEC within
22 days after the Closing Date or (ii) been declared effective by the SEC within
90 days after the Closing Date (each such event referred to in clauses (i) and
(ii), a "Registration Default"), for all or part of each 30-day period (a
"Penalty Period") during which the Registration Default remains uncured, the
Company shall issue or pay, as applicable, to each Investor 1% for each Penalty
Period, on a pro-rated basis for the number of days during which there remains a
Registration Default, of the aggregate purchase price paid by the Investor for
its Shares, payable in cash. The Company shall deliver said cash payment to the
Investor by the fifth business day after the end of each such Penalty Period.
Notwithstanding anything to the contrary in Section 7.3 or any other provision
of this Agreement, the payment of cash as provided in this Section 7.1(k) shall
be the Investor's sole and exclusive remedy in the event of any Registration
Default; provided, however, that (i) the Investor shall be entitled to seek
specific performance and injunctive or other equitable relief and (ii) if the
foregoing remedy is deemed unenforceable by a court of competent jurisdiction
then the Investor shall have all other remedies available at law or in equity.
7.2 Transfer of Shares; Suspension.
(a) The Investor agrees that it will not effect
any Disposition of the Shares or its right to purchase the Shares that would
constitute a sale within the meaning of the Securities Act except as
contemplated in the Registration Statement referred to in Section 7.1 and as
described below or otherwise in accordance with the Securities Act, and that it
will promptly notify the Company of any changes in the information set forth in
the Registration Statement regarding the Investor or its plan of distribution.
In no event, and notwithstanding anything contained herein to the contrary, will
any Company securities owned, held, purchased or otherwise acquired by the
Investor (other than the Shares purchased hereunder) be subject to restrictions
on transfer pursuant to the terms of this Agreement.
(b) Except in the event that paragraph (c) below
applies, the Company shall, at all times during the Registration Period,
promptly (i) prepare and file from time to time with the SEC a post-effective
amendment to the Registration Statement or a supplement to the related
Prospectus or a supplement or amendment to any document incorporated therein by
reference or file any other required document so that such Registration
Statement will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, and so that, as thereafter delivered to
purchasers of the Shares being sold thereunder, such Prospectus will not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; (ii) provide the
Investor copies of any documents filed pursuant to Section 7.2(b)(i); and (iii)
inform each Investor that the Company has complied with its obligations in
Section 7.2(b)(i) (or that, if the Company has filed a post-effective amendment
to the Registration Statement which has not yet been declared effective, the
Company will notify the Investor to that effect, will use its best efforts to
secure the effectiveness of such post-effective amendment as promptly as
possible and will promptly notify the Investor pursuant to Section 7.2(b)(i)
hereof when the amendment has become effective).
14
(c) Subject to paragraph (d) below, in the event
(i) of any request by the SEC or any other federal or state governmental
authority during the period of effectiveness of the Registration Statement for
amendments or supplements to a Registration Statement or related Prospectus or
for additional information; (ii) of the issuance by the SEC or any other federal
or state governmental authority of any stop order suspending the effectiveness
of a Registration Statement or the initiation of any proceedings for that
purpose; (iii) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Registrable Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; or (iv) of any event or
circumstance which necessitates the making of any changes in the Registration
Statement or Prospectus, or any document incorporated or deemed to be
incorporated therein by reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; then the Company shall deliver a certificate in
writing to the Investor (the "Suspension Notice") to the effect of the foregoing
and, upon receipt of such Suspension Notice, the Investor will refrain from
selling any Registrable Shares pursuant to the Registration Statement (a
"Suspension") until the Investor's receipt of copies of a supplemented or
amended Prospectus prepared and filed by the Company, or until it is advised in
writing by the Company that the current Prospectus may be used, and has received
copies of any additional or supplemental filings that are incorporated or deemed
incorporated by reference in any such Prospectus. In the event of any
Suspension, the Company will use its best efforts to cause the use of the
Prospectus so suspended to be resumed as soon as reasonably practicable after
the delivery of a Suspension Notice to the Investor. In addition to and without
limiting any other remedies (including, without limitation, at law or at equity)
available to the Investor, the Investor shall be entitled to specific
performance in the event that the Company fails to comply with the provisions of
this Section 7.2(c).
(d) Notwithstanding the foregoing paragraphs of
this Section 7.2, the Investor shall not be prohibited from selling Registrable
Shares under the Registration Statement as a result of Suspensions on more than
two occasions (for two separate suspension events) of not more than 30 days each
in any twelve month period.
(e) Provided that a Suspension is not then in
effect, the Investor may sell Registrable Shares under the Registration
Statement, provided that it arranges for delivery of a current Prospectus to the
transferee of such Shares. Upon receipt of a request therefor, the Company has
agreed to provide, at its own expense, an adequate number of current
Prospectuses (including documents incorporated by reference therein) to the
Investor and to supply copies to any other parties requiring such Prospectuses.
(f) In the event of a sale of Registrable Shares
by the Investor under the Registration Statement, the Investor must also deliver
to the Company's transfer agent, with a copy to the Company, a Certificate of
Subsequent Sale substantially in the form attached hereto as Exhibit A, so that
the Registrable Shares may be properly transferred.
15
7.3 Indemnification. For the purpose of this Section 7.3:
(i) the term "Selling Stockholder" shall mean the
Investor;
(ii) the term "Registration Statement" shall include any
final Prospectus, exhibit, supplement or amendment included in or relating to
the Registration Statement referred to in Section 7.1; and
(iii) the term "untrue statement" shall include any untrue
statement or alleged untrue statement, or any omission or alleged omission to
state in the Registration Statement or Prospectus a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(a) The Company agrees to indemnify and hold
harmless each Selling Stockholder from and against any losses, claims, damages,
liabilities or expenses to which such Selling Stockholder may become subject
(under the Securities Act or otherwise) insofar as such losses, claims, damages,
liabilities or expenses (or actions or proceedings in respect thereof) arise out
of, or are based upon (i) any untrue statement and/or omission of a material
fact contained in the Registration Statement or Prospectus, (ii) any failure by
the Company to fulfill any undertaking included in the Registration Statement,
or (iii) any breach of any representation, warranty or covenant made by the
Company in this Agreement, and the Company will promptly reimburse such Selling
Stockholder for any reasonable legal or other expenses incurred in
investigating, defending or preparing to defend, settling, compromising or
paying any such action, proceeding or claim, provided, however, that the Company
shall not be liable in any such case to the extent that such loss, claim,
damage, liability or expense arises solely out of, or is based solely upon, an
untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by such Selling
Stockholder specifically for use in preparation of the Registration Statement or
the failure of such Selling Stockholder to comply with its covenants and
agreements contained in Sections 5.3 or 7.2 hereof respecting sale of the Shares
or any statement or omission in any Prospectus that is corrected in any
subsequent Prospectus that was delivered to the Investor at least three business
days prior to the pertinent sale or sales by the Investor. Notwithstanding the
foregoing, the Company shall not be liable to any Selling Stockholder for any
consequential damages, including lost profits, solely with respect to losses,
claims, damages, liabilities or expenses to which such Selling Stockholder may
become subject arising out of, or based upon, any breach of any representation,
warranty or covenant made by the Company in this Agreement.
(b) The Investor agrees (severally and not
jointly with any other Investor) to indemnify and hold harmless the Company (and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act, each officer of the Company who signs the Registration
Statement and each director of the Company) from and against any losses, claims,
damages, liabilities or expenses to which the Company (or any such officer,
director or controlling person) may become subject (under the Securities Act or
otherwise), insofar as such losses, claims, damages, liabilities or expenses (or
actions or proceedings in respect thereof) arise solely out of, or are based
solely upon, (i) any failure to comply with the covenants and agreements
contained in Section 5.3 or 7.2 hereof respecting sale of the Shares, or (ii)
any untrue statement of a material fact
16
contained in the Registration Statement if such untrue statement was made in
reliance upon and in conformity with written information furnished by the
Investor specifically for use in preparation of the Registration Statement
(provided, however, that no Investor shall be liable in any such case for any
untrue statement in any Registration Statement or Prospectus if such statement
has been corrected in writing by such Investor and delivered to the Company at
least three business days prior to the pertinent sale or sales by the Investor),
and the Investor will reimburse the Company (or such officer, director or
controlling person), as the case may be, for any legal or other expenses
reasonably incurred in investigating, defending or preparing to defend,
settling, compromising or paying any such action, proceeding or claim.
Notwithstanding the foregoing, (x) the Investor's aggregate liability pursuant
to this subsection (b) and subsection (d) shall be limited to the net amount
received by the Investor from the sale of the Shares and (y) the Investor shall
not be liable to the Company for any consequential damages, including lost
profits, solely with respect to losses, claims, damages, liabilities or expenses
to which the Company (or any officer, director or controlling person as set
forth above) may become subject (under the Securities Act or otherwise), arising
out of, or based upon, any failure to comply with the covenants and agreements
contained in Section 5.3 or 7.2 hereof respecting sale of the Shares.
(c) Promptly after receipt by any indemnified
person of a notice of a claim or the beginning of any action in respect of which
indemnity is to be sought against an indemnifying person pursuant to this
Section 7.3, such indemnified person shall notify the indemnifying person in
writing of such claim or of the commencement of such action, but the omission to
so notify the indemnifying party will not relieve it from any liability which it
may have to any indemnified party under this Section 7.3 (except to the extent
that such omission materially and adversely affects the indemnifying party's
ability to defend such action) or from any liability otherwise than under this
Section 7.3. Subject to the provisions hereinafter stated, in case any such
action shall be brought against an indemnified person, the indemnifying person
shall be entitled to participate therein, and, to the extent that it shall elect
by written notice delivered to the indemnified party promptly after receiving
the aforesaid notice from such indemnified party, shall be entitled to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
person. After notice from the indemnifying person to such indemnified person of
its election to assume the defense thereof, such indemnifying person shall not
be liable to such indemnified person for any legal expenses subsequently
incurred by such indemnified person in connection with the defense thereof,
provided further, however, that if there exists or shall exist a conflict of
interest that would make it inappropriate, in the opinion of counsel to the
indemnified person, for the same counsel to represent both the indemnified
person and such indemnifying person or any affiliate or associate thereof, the
indemnified person shall be entitled to retain its own counsel at the expense of
such indemnifying person; provided, however, that no indemnifying person shall
be responsible for the fees and expenses of more than one separate counsel
(together with appropriate local counsel) for all indemnified parties. In no
event shall any indemnifying person be liable in respect of any amounts paid in
settlement of any action unless the indemnifying person shall have approved the
terms of such settlement; provided that such consent shall not be unreasonably
withheld. No indemnifying person shall, without the prior written consent of the
indemnified person, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified person is or could have been a
party and indemnification could have been sought hereunder by such indemnified
person, unless such settlement includes an unconditional release of such
indemnified person from all liability on claims that are the subject matter of
such proceeding.
17
(d) If the indemnification provided for in this
Section 7.3 is unavailable to or insufficient to hold harmless an indemnified
party under subsection (a) or (b) above in respect of any losses, claims,
damages, liabilities or expenses (or actions or proceedings in respect thereof)
referred to therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages, liabilities or expenses (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the Company on the
one hand and the Investor on the other in connection with the statements or
omissions or other matters which resulted in such losses, claims, damages,
liabilities or expenses (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative fault shall be determined by
reference to, among other things, in the case of an untrue statement, whether
the untrue statement relates to information supplied by the Company on the one
hand or an Investor on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement. The Company and the Investors agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined by pro
rata allocation (even if the Investors were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), no Investor shall be required to contribute any amount in excess
of the net amount received by the Investor from the sale of the Shares. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Investors'
obligations in this subsection to contribute are several in proportion to their
sales of Shares to which such loss relates and not joint.
(e) The parties to this Agreement hereby
acknowledge that they are sophisticated business persons who were represented by
counsel during the negotiations regarding the provisions hereof including,
without limitation, the provisions of this Section 7.3, and are fully informed
regarding said provisions.
7.4 Rule 144. For a period of two years following the
date hereof, the Company agrees with each holder of Registrable Shares to:
(a) comply with the requirements of Rule 144(c)
under the Securities Act with respect to current public information about the
Company;
(b) use its best efforts to file with the SEC in
a timely manner all reports and other documents required of the Company under
the Securities Act and the Exchange Act (at any time it is subject to such
reporting requirements); and
(c) furnish to any holder of Registrable Shares
upon request (i) a written statement by the Company as to its compliance with
the requirements of said Rule 144(c) and the reporting requirements of the
Securities Act and the Exchange Act (at any time it is subject to such reporting
requirements), (ii) a copy of the most recent annual or quarterly report of the
Company,
18
and (iii) such other reports and documents of the Company as such holder may
reasonably request to avail itself of any similar rule or regulation of the SEC
allowing it to sell any such securities without registration.
7.5 Termination of Conditions and Obligations. The
conditions precedent imposed by Section 5 or this Section 7 upon Dispositions of
the Registrable Shares by the Investor shall cease and terminate as to any
particular number of the Registrable Shares and the restrictive legend shall be
removed when such Registrable Shares shall have been effectively registered
under the Securities Act and sold or otherwise disposed of in accordance with
the intended method of disposition set forth in the Registration Statement
covering such Registrable Shares or at such time as an opinion of counsel
reasonably satisfactory to the Company shall have been rendered to the effect
that such conditions are not necessary in order to comply with the Securities
Act (provided that such opinion shall not be required if the Company shall be
furnished with written documentation reasonably satisfactory to it that such
Registrable Shares are being transferred in a customary transaction exempt from
registration under Rule 144 under the Securities Act).
8. Notices. Except as specifically permitted by Section 7.1(g),
all notices, requests, consents and other communications hereunder shall be in
writing, shall be mailed (A) if within domestic United States by first-class
registered or certified airmail, or nationally recognized overnight express
courier, postage prepaid, or by facsimile, or (B) if delivered from outside the
United States, by International Federal Express or facsimile, and shall be
deemed given (i) if delivered by first-class registered or certified mail
domestic, three business days after so mailed, (ii) if delivered by nationally
recognized overnight carrier, one business day after so mailed, (iii) if
delivered by International Federal Express, two business days after so mailed,
and (iv) if delivered by facsimile, upon electric confirmation of receipt and
shall be delivered as addressed as follows:
(a) if to the Company, to:
Conceptus, Inc.
0000 Xxxxxx Xxx.
Xxx Xxxxxx, XX 00000
Attn: President and Chief Executive Officer
Phone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxxx LLP
000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Attn: Xxx X. Xxxxxx, Esq.
Phone: (000) 000-0000
Telecopy: (000) 000-0000
(b) if to the Investor, at its address on the signature
page hereto, or at such other address or addresses as may have been furnished to
the Company in writing.
19
9. Changes. This Agreement may not be modified or amended except
pursuant to an instrument in writing signed by the Company and the Investor.
10. Headings. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
11. Severability. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
12. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of California,
without giving effect to the principles of conflicts of law.
13. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto pertaining to the subject matter hereof,
and any and all other written or oral agreements relating to such subject matter
are expressly cancelled.
14. Finders Fees. Neither the Company nor the Investor nor any
affiliate thereof has incurred any obligation which will result in the
obligation of the other party to pay any finder's fee or commission in
connection with this transaction.
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.
16. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of the
Company and the Investors, including without limitation and without the need for
an express assignment, affiliates of the Investors. With respect to transfers
that are not made pursuant to the Registration Statement, the rights and
obligations of an Investor under this Agreement shall be automatically assigned
by such Investor to any transferee of all or any portion of such Investor's
Registrable Shares who is a Permitted Transferee (as defined below); provided,
however, that within two business days prior to the transfer, (i) the Company is
provided notice of the transfer including the name and address of the transferee
and the number of Registrable Shares transferred; and (ii) that such transferee
agrees in writing to be bound by the terms of this Agreement. (For purposes of
this Agreement, a "Permitted Transferee" shall mean any Person who (a) is an
"accredited investor," as that term is defined in Rule 501(a) of Regulation D
under the Securities Act and (b) is a transferee of at least 20,000 Registrable
Shares as permitted under the securities laws of the United States). Upon any
transfer permitted by this Section 16, the Company shall be obligated to such
transferee to perform all of its covenants under this Agreement as if such
transferee were an Investor.
17. Expenses. Each of the Company and the Investors shall bear its
own expenses in connection with the preparation and negotiation of the
Agreement; provided that, notwithstanding the foregoing, the Company agrees to
pay the reasonable fees and expenses of Xxxxxx Xxxx &
20
Xxxxxxxxx LLP, counsel to certain of the Investors, in connection with the
negotiation, documentation and consummation of this Agreement and the
transactions contemplated hereby, not to exceed $35,000 without the prior
written consent of the Company, which consent shall not be unreasonably
withheld.
21
Exhibit A
CERTIFICATE OF SUBSEQUENT SALE
Mellon Investor Services LLC
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
RE: Sale of Shares of Common Stock of Conceptus, Inc.
(the "Company") pursuant to the Company's Prospectus
dated _____________ (the "Prospectus")
Ladies and Gentlemen:
The undersigned hereby certifies, in connection with the sale of shares
of Common Stock of the Company included in the table of Selling Stockholders in
the Prospectus, that the undersigned has sold the shares pursuant to the
Prospectus and in a manner described under the caption "Plan of Distribution" in
the Prospectus and that such sale complies with all applicable securities laws,
including, without limitation, the Prospectus delivery requirements of the
Securities Act of 1933, as amended.
Selling Stockholder (the beneficial owner): ____________________________________
Record Holder (e.g., if held in name of nominee): ______________________________
Restricted Stock Certificate No.(s): ___________________________________________
Number of Shares Sold: _________________________________________________________
Date of Sale: __________________________________________________________________
In the event that you receive a stock certificate(s) representing more
shares of Common Stock than have been sold by the undersigned, then you should
return to the undersigned a newly issued certificate for such excess shares in
the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you
should place a stop transfer on your records with regard to such certificate.
Very truly yours,
Dated: _____________________________ By: ______________________________
Print Name: ______________________
Title: ___________________________
cc: President and Chief Executive Office
Conceptus, Inc.
0000 Xxxxxx Xxxxxx
Xxx Xxxxxx, XX 00000
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