EXHIBIT 4.9
[Pension]
SUBSCRIPTION AGREEMENT AND
INVESTMENT LETTER
GalaGen Inc.
0000 Xxx Xxx Xxxx
XX - 7420
Xxxxx Xxxxx, Xxxxxxxxx 00000-0000
Gentlemen:
The undersigned hereby subscribes for and offers to purchase from GalaGen
Inc., a Delaware corporation (the "Company"), 15,000 shares of Common Stock of
the Company, par value $.01 per share (the "Shares"). The undersigned further
understands that the offering is being made without registration of the Shares
under the Securities Act of 1933, as amended (the "Securities Act"), and is
being made only to "accredited investors" (as defined in Rule 501 of Regulation
D under the Securities Act).
1. PURCHASE PRICE. Subject to the terms and conditions hereof, the
undersigned hereby irrevocably subscribes for the Shares for an aggregate
purchase price of $22,500, which amount is payable as described in Section 4
hereof.
2. ACCEPTANCE OF SUBSCRIPTION AND ISSUANCE OF SHARES. It is
understood and agreed that the Company shall have the sole right, at its
complete discretion, to accept or reject this subscription, in whole or in part,
for any reason and that the same shall be deemed to be accepted by the Company
only when it is signed by a duly authorized officer of the Company and delivered
to the undersigned at the Closing referred to in Section 3 hereof.
Notwithstanding anything in this Agreement to the contrary, the Company shall
have no obligation to issue any of the Shares to any person who is a resident of
a jurisdiction in which the issuance of Shares to such person would constitute a
violation of the securities, "blue sky" or other similar laws of such
jurisdiction (collectively referred to as the "State Securities Laws").
3. THE CLOSING. The closing of the purchase and sale of the Shares
(the "Closing") shall take place on April 20, 1999 (the "Closing Date") and at a
place and at a time mutually agreed to by the Company and the undersigned.
4. PAYMENT FOR SHARES. Payment for the Shares shall be received by
the Company from the undersigned by cashier's check or wire transfer of
immediately available funds at or prior to the Closing. The Company shall
deliver the Shares to the undersigned at the Closing.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the undersigned that:
(a) The Company is duly incorporated, validly existing and in
good standing under the laws of the State of Delaware, with full power
and authority to conduct its business as it is currently being conducted
and to own its assets. The Company is duly qualified as a foreign
corporation to do business in each jurisdiction in which the ownership of
its property or the conduct of its business requires such qualification,
except where the failure to so qualify would not materially or adversely
affect the Company, its business, assets, condition (financial or
otherwise) or operations.
(b) The Company has all requisite authority to enter into this
Agreement and the Registration Rights Agreement (as defined in
Section 17) and to perform all the obligations required to be performed
by the Company hereunder and thereunder. All corporate action on the
part of the Company, its officers, directors and stockholders necessary
for the authorization, execution and delivery of this Agreement and the
Registration Rights Agreement, the performance of all the Company's
obligations hereunder and thereunder, and for the authorization,
issuance, sale and delivery of the Shares has been taken or will be taken
prior to the Closing. Each of this Agreement and the Registration Rights
Agreement, when executed and delivered by the Company, shall, assuming
due execution and delivery by the undersigned, constitute a valid and
legally binding obligation of the Company enforceable in accordance with
its terms, except as the enforceability hereof and thereof may be limited
by bankruptcy, insolvency, moratorium, reorganization or other similar
laws affecting the enforcement of creditors' rights generally, and except
for judicial limitations on the enforcement of the remedy of specific
performance and other equitable remedies.
(c) The Shares, when issued and paid for, will represent duly
authorized, validly issued and fully paid and nonassessable shares of
Common Stock of the Company, free of any liens, claims or encumbrances
except for restrictions on transfer imposed by state and federal
securities laws and except for the liens, claims and encumbrances created
by the undersigned, and the issuance of the Shares is not subject to any
preemptive right or right of first refusal that has not been waived.
(d) Assuming the accuracy of the representations and warranties
of the undersigned contained in Section 6 hereof on the date hereof and
on the Closing Date, the offer, issue, and sale of the Shares are exempt
from the registration and prospectus delivery requirements of the
Securities Act and have been registered or qualified (or are exempt from
registration and qualification) under the registration, permit, or
qualification requirements of all applicable State Securities Laws.
(e) The Company has furnished to the undersigned the Company's
annual report on Form 10-K for the fiscal year ended December 31, 1998
(the "SEC
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Document"). The Company warrants that, as of its date (or if amended,
as of the date of such amendment), the SEC Document complied as to
form in all material respects with the requirements of the Securities
Exchange Act of 1934 (the "1934 Act"), and the information contained in
such document, as of its date, did not contain any untrue statement of a
material fact, and did not omit to state any material fact necessary to
make any statement, in light of the circumstances under which such
statement was made, not misleading. The Company has not filed with the
Securities and Exchange Commission (the "SEC") any reports under the 1934
Act since the date of the SEC Document.
(f) The Company has, within the past twelve months, timely
filed with the SEC all reports and other documents required to be so
filed.
(g) The Company is authorized to issue 40,000,000 shares of
Common Stock and 15,000,000 shares of Preferred Stock. As of March 31,
1999, there were 8,983,996 shares of Common Stock and no shares of
Preferred Stock outstanding. No shares of capital stock of the Company,
or securities convertible into or exercisable for such capital stock,
have been issued by the Company since March 31, 1999 except for issuances
pursuant to the Company's equity compensation plans or pursuant to
outstanding options, warrants, rights or convertible notes, in each case
as disclosed in the SEC Document. All outstanding shares of Common Stock
have been duly authorized and validly issued and are fully paid and
non-assessable; and none of the outstanding shares of Common Stock were
issued in violation of the preemptive rights, if any, of any stockholders
of the Company.
(h) There is no action, suit or proceeding pending, or, to the
Company's knowledge, threatened, against the Company (a) which questions
the validity of this Agreement or the ability of the Company to
consummate the transactions contemplated hereby or (b) which, singly or
in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially adversely affect the business, properties,
prospects, operations, or financial condition of the Company.
(i) To the Company's knowledge, there are no outstanding
stockholder agreements, voting trusts, proxies or other arrangements or
understandings among the stockholders of the Company relating to the
voting of their respective shares other than proxies which have been or
may be given in connection with the Company's annual meeting of
stockholders and other than as disclosed in documents filed with the SEC
pursuant to the Securities Exchange Act of 1934, as amended.
(j) The execution, delivery and performance of this Agreement
and the Registration Rights Agreement and consummation of the
transactions contemplated hereby and thereby will not (a) violate or
conflict with any provisions of the Restated Certificate of
Incorporation, as amended, or Bylaws of the Company; (b) result in any
breach, violation of or default or loss of a benefit under, or conflict
with, or permit the acceleration of any obligation under (in each case,
upon the giving of notice, the
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passage of time, or both) any mortgage, indenture, lease, loan agreement
or other agreement or instrument, permit, franchise, license, judgment,
order, decree, law, ordinance, rule or regulation applicable to the
Company or its properties.
(k) All consents, approvals, orders, or authorizations of, or
registrations, qualifications, designations, declarations, or filings
with, any federal, state or local governmental authority, required on the
part of the Company in connection with the valid execution, delivery and
performance of this Agreement and the Registration Rights Agreement, the
offer, sale or issuance of the Shares, or the consummation of any other
transaction contemplated hereby and thereby, have been obtained, or will
be effective at the Closing, except for notices required or permitted to
be filed with certain state and federal securities commissions after the
Closing, which notices will be filed on a timely basis and except for
filings and such other actions required to be taken pursuant to the
Registration Rights Agreement after the date hereof.
(l) Except as disclosed in or contemplated by the SEC Document
and except for the repurchase from Chiron Corporation on April 1, 1999 of
three warrants to purchase shares of Common Stock of the Company, the
Company has not otherwise had any material change in its condition,
financial or otherwise, except for changes in the ordinary course of
business, consistent with past practices, none of which individually or
in the aggregate has had a material adverse effect on the Company.
(m) The Common Stock of the Company is currently listed on the
Nasdaq National Market and shall continue to be listed on either the
Nasdaq National Market or The Nasdaq SmallCap Market.
(n) No representation or warranty by the Company in this
Agreement, and no statement by an officer of the Company contained in any
document, certificate or other writing furnished to the undersigned in
connection with the transactions contemplated hereby, when taken as a
whole, contains any untrue statement of a material fact or omits to state
any material fact necessary to make statements herein or therein not
misleading in light of the circumstances in which they are made.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE UNDERSIGNED. The
undersigned hereby represents and warrants to and covenants with the Company
that:
(a) GENERAL:
(i) The undersigned has all requisite authority to enter
into this Agreement and the Registration Rights Agreement and to
perform all the obligations required to be performed by the
undersigned hereunder and thereunder. Each of this Agreement and
the Registration Rights Agreement, when executed and delivered by
the undersigned, shall, assuming due execution and delivery by
the Company, constitute a valid and legally binding obligation
of the undersigned enforceable in accordance with its terms,
except
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as the enforceability hereof and thereof may be limited by
bankruptcy, insolvency, moratorium, reorganization or other
similar laws affecting the enforcement of creditors' rights
generally, and except for judicial limitations on the
enforcement of the remedy of specific performance and other
equitable remedies.
(ii) The undersigned is a resident of or is domiciled
in the state or other jurisdiction set forth on the signature
page hereto and is not acquiring the Shares as an agent or
otherwise for any other person.
(b) INFORMATION CONCERNING THE COMPANY:
(i) The undersigned realizes that purchase of the
Shares is a speculative investment, and that the economic
benefits which may be derived therefrom are uncertain. In
determining whether or not to make an investment in the
Company, the undersigned has relied solely upon the written
materials provided to the undersigned by the Company, receipt
of which is hereby acknowledged, and upon independent
investigations made by the undersigned and the undersigned's
representatives.
(ii) The opportunity has been made available to the
undersigned to ask questions of and receive answers from
representatives of the Company concerning the terms and
conditions of the Shares and to review the Company's material
books and records.
(iii) The undersigned understands that no federal or
state agency has passed upon the Shares or made any finding or
determination concerning the fairness or advisability of this
investment.
(c) STATUS OF UNDERSIGNED:
(i) The undersigned, if an individual, has attained
the age of majority (as established in the undersigned's state
of residence), and, in any event, is under no disability with
respect to entering into a contractual relationship with the
Company and in executing this Agreement.
(ii) The undersigned has such knowledge, skill and
experience in business, financial and investment matters so
that the undersigned is capable of evaluating the merits and
risks of an investment in the Shares. To the extent necessary,
the undersigned has retained, at the undersigned's own expense,
and relied upon, appropriate professional advice regarding the
investment, tax and legal merits and consequences of this
Agreement and of owning the Shares.
(iii) The undersigned is an "accredited investor" as
defined in Rule 501(a) under the Securities Act. The
undersigned agrees to furnish any
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additional information requested to assure compliance with
applicable federal and state securities laws in connection
with the purchase and sale of the Shares. The undersigned
acknowledges that the undersigned has completed Part I, the
Subscriber Information questionnaire, and Part II, the
Accreditation Criteria questionnaire, previously provided to
the undersigned and that the information contained therein
is complete and accurate as of the date thereof and is hereby
affirmed as of the date hereof.
(iv) The information presented and statements made by
the undersigned in the questionnaire referred to in Section
6(c)(iii) completed and delivered by the undersigned and
returned to the Company with this Agreement, and any additional
information supplied by the undersigned at the Company's
request relating to the undersigned's income, net worth,
investment experience or other matters, are complete and
accurate as of this date and may be relied upon by the Company
in determining whether to accept this offer.
(v) The undersigned's commitment to investments that
are not readily marketable is not disproportionate to the
undersigned's net worth, and an investment in the Shares will
not cause such commitment to become excessive. The undersigned
has adequate means of providing for the undersigned's current
needs and contingencies and has no need for liquidity with
respect to the undersigned's investment in the Shares, and can
withstand a complete loss of such investment in the Shares.
(d) RESTRICTIONS ON TRANSFER OR SALE OF SHARES:
(i) The undersigned is acquiring the Shares for the
undersigned's own account for investment purposes and not with
a view to or for resale in connection with any distribution
thereof. The undersigned understands that the Shares have not
been registered under the Securities Act, or any State
Securities Laws, in reliance on exemptions from registration
which depend, in part, on the undersigned's investment
intention; and, accordingly, the truth and accuracy of the
foregoing representation will be relied upon by the Company to
establish such exemptions. The undersigned acknowledges that
the Company is not required to recognize any transfer of the
Shares unless, in the opinion of counsel to the Company, such
transfer would not result in a violation of any federal or
state law regarding the offer and sale of securities and unless
the other restrictions on transfer set forth in the Shares are
complied with.
(ii) The undersigned understands that the Shares are
"restricted securities" under applicable federal securities
laws and that the Securities Act and the rules of the SEC
provide in substance that the undersigned may dispose of the
Shares only pursuant to an effective
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registration statement under the Securities Act or an exemption
therefrom, and the undersigned understands that the Company has
no obligation or intention to register any of the Shares
(except for the registration rights referred to in Section 18
hereof), or to take action so as to permit sales pursuant to
the Securities Act (including Rule 144 thereunder).
Accordingly, the undersigned understands that, under the SEC's
rules and until the Shares are registered for sale under the
Securities Act, the undersigned may dispose of the Shares
principally only in "private placements" which are exempt from
registration under the Securities Act, in which event the
transferee will acquire "restricted securities" subject to the
same limitations as in the hands of the undersigned. As a
consequence, the undersigned understands that the undersigned
must bear the economic risks of the investment in the Shares
for an indefinite period of time.
(iii) The undersigned agrees: (A) that the undersigned
will not sell, assign, pledge, give, transfer or otherwise
dispose of the Shares or any interest therein, or make any
offer or attempt to do any of the foregoing, except pursuant to
a registration of the Shares, as applicable, under the
Securities Act and all applicable State Securities Laws or in a
transaction which is exempt from the registration provisions of
the Securities Act and all applicable State Securities Laws;
(B) that the certificate(s) for the Shares will bear a legend
making reference to the foregoing restrictions; and (C) that
the Company and any transfer agent for the Shares shall not be
required to give effect to any purported transfer of such
Shares except upon compliance with the foregoing restrictions.
(iv) The undersigned has not offered or sold any
portion of the undersigned's Shares.
(v) The undersigned acknowledges that the Company has
the right in its sole and absolute discretion to abandon this
private placement at any time prior to the completion of the
offering and to return the previously paid subscription price
of the Shares, without interest thereon, to the undersigned.
(vi) The undersigned has not used any person as a
"Purchaser Representative" within the meaning of SEC Regulation
D to represent it in determining whether it should purchase the
Shares.
7. CONDITIONS TO CLOSING.
(a) CONDITIONS TO OBLIGATIONS OF THE UNDERSIGNED. The
undersigned's obligation to purchase the Shares at the Closing is subject
to the fulfillment, at or prior to the Closing, of all of the following
conditions, any of which may be waived by the undersigned:
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(i) The representations and warranties made by the
Company in Section 5 hereof shall be true and correct in all
respects on the date of the Closing with the same force and
effect as if they had been made on and as of said date; and the
Company shall have performed and complied with all obligations,
agreements and conditions herein required to be performed by it
on or prior to the Closing.
(ii) All corporate and other proceedings in connection
with the transactions contemplated at the Closing hereby and
all documents and instruments incident to such transactions
shall be reasonably satisfactory in substance and form to the
undersigned, and the undersigned shall have received all such
counterpart originals or certified or other copies of such
documents as it may reasonably request.
(iii) All authorizations, approvals, or permits, if
any, of any governmental authority or regulatory body of the
United States or of any state that are required in connection
with the lawful sale and issuance of the Shares pursuant to
this Agreement shall have been duly obtained and shall be
effective on and as of the Closing, except for notices required
or permitted to be filed with certain state and federal
securities commissions after the Closing, which notices will be
filed on a timely basis, and except for filings and other
actions required to be taken pursuant to the Registration
Rights Agreement after the date hereof. At the time of the
Closing, the sale and issuance of the Shares shall be legally
permitted by all laws and regulations to which the undersigned
and the Company are subject.
(iv) No stop order or other order enjoining the sale
of the Shares shall have been issued and no proceedings for
such purpose shall be pending or, to the knowledge of the
Company, threatened by the SEC or any commissioner of
corporations or similar officer of any other state having
jurisdiction over this transaction.
(v) The Company shall have delivered to the
undersigned a Certificate, executed by the President of the
Company, dated the Closing Date, certifying to (i) the
fulfillment of the conditions specified in subparagraphs (i)
and (iv) of this Section 8 and (ii) the incumbency of the
officers of the Company executing this Agreement and the other
instruments delivered by the Company upon the Closing.
(b) CONDITIONS TO OBLIGATIONS OF THE COMPANY. In addition to,
and not in limitation of, the Company's rights set forth in Section 2
hereof, the Company's obligation to issue and sell the Shares at the
Closing is subject to the fulfillment, on or prior to the Closing, of the
following conditions, any of which may be waived by the Company:
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(i) The representations and warranties made by the
undersigned in Section 6 hereof shall be true and correct in
all respects on the date of the Closing with the same force and
effect as if they had been made on and as of said date, and the
undersigned shall have performed and complied with all
obligations, agreements and conditions herein required to be
performed by the undersigned on or before the Closing.
(ii) All authorizations, approvals, or permits, if
any, of any governmental authority or regulatory body of the
United States or of any state that are required in connection
with the lawful sale and issuance of the Shares pursuant to
this Agreement shall have been duly obtained and shall be
effective on and as of the Closing. No stop order or other
order enjoining the sale of the Shares shall have been issued
and no proceedings for such purpose shall be pending or, to the
knowledge of the Company, threatened by the SEC or any
commissioner of corporations or similar officer of any state
having jurisdiction over this transaction. At the time of the
Closing, the sale and issuance of the Shares shall be legally
permitted by all laws and regulations to which the undersigned
and the Company are subject.
8. LEGEND. Each certificate for Shares will be imprinted with a
legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR TRANSFERRED OR OFFERED
FOR SALE OR TRANSFER UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND OTHER APPLICABLE SECURITIES LAWS WITH RESPECT TO SUCH SECURITIES
IS THEN IN EFFECT, OR, IN THE OPINION OF COUNSEL, SUCH REGISTRATION UNDER
THE SECURITIES ACT AND OTHER APPLICABLE SECURITIES LAWS IS NOT REQUIRED."
9. BROKERS. The undersigned has not entered into any agreement to
pay any broker's or finder's fee to any person with respect to this Agreement or
the transactions contemplated hereby.
10. FILING OF REPORTS. The Company will, so long as it has securities
registered pursuant to Section 12 of the 1934 Act or has securities registered
pursuant to the Securities Act, make timely filing of such reports as are
required to be filed by it with the SEC so that Rule 144 under the Securities
Act or any successor provision thereto will be available to the security holders
of the Company who are otherwise able to take advantage of the provisions of
such Rule.
11. WAIVER, AMENDMENT. Neither this Agreement nor any provisions
hereof shall be modified, changed, discharged or terminated except by an
instrument in writing, signed by the party against whom any waiver, change,
discharge or termination is sought, and any
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waiver, change, discharge or termination shall be effective only to the
extent specifically set forth in such writing.
12. ASSIGNABILITY. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by either the Company or the undersigned without the prior written
consent of the other party.
13. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware.
14. SECTION AND OTHER HEADINGS. The section and other headings
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which together shall be deemed to be one and the same
agreement.
16. NOTICES. All notices and other communications provided for herein
shall be in writing and shall be deemed to have been duly given if delivered
personally or sent by registered or certified mail, return receipt requested,
postage prepaid:
(a) If to the Company, to it at the following address:
GalaGen Inc.
0000 Xxx Xxx Xxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000-0000
Attn: Chief Executive Officer
(b) If to the undersigned, the address set forth on the
signature page hereto;
or at such other address as either party shall have specified by notice in
writing to the other.
17. BINDING EFFECT. The provisions of this Agreement shall be binding
upon and accrue to the benefit of the parties hereto and their respective heirs,
legal representatives, successors and assigns.
18. REGISTRATION RIGHTS. The Company and the undersigned agree that
the undersigned shall have the benefit of the registration rights as set forth
in the Registration Rights Agreement of even date herewith, in the form attached
as Appendix A hereto (the "Registration Rights Agreement"), with respect to the
Shares.
19. SURVIVAL. All representations, warranties and covenants contained
in this Agreement shall survive (i) the acceptance of the subscription by the
Company and (ii) if the undersigned is an individual, the death or disability of
the undersigned.
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20. NOTIFICATION OF CHANGES. The undersigned hereby covenants and
agrees to notify the Company upon the occurrence of any event prior to the
Closing of the purchase of the Shares pursuant to this Agreement which would
cause any representation, warranty, or covenant of the undersigned contained in
this Agreement to be false or incorrect.
21. ENTIRE AGREEMENT. This Agreement, the Appendices hereto, and the
other documents delivered pursuant hereto constitute the full and entire
understanding and agreement among the parties with regard to the subjects hereof
and no party shall be liable or bound to any other party in any manner by any
representations, warranties, covenants, or agreements except as specifically set
forth herein or therein. Nothing in this Agreement, express or implied, is
intended to confer upon any party, other than the parties hereto and their
respective successors and assigns, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
herein.
22. SEPARABILITY. In case any provision of this Agreement shall be
invalid, illegal, or unenforceable, it shall to the extent practicable be
modified so as to make it valid, legal and enforceable and to retain as nearly
as practicable the intent of the parties, and the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
23. DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power, or remedy accruing to either party or its respective successors and
assigns upon any breach, default or noncompliance of the other party hereto
under this Agreement shall impair any such right, power, or remedy, nor shall it
be construed to be a waiver of any such breach, default or noncompliance, or any
acquiescence therein, or of any similar breach, default or noncompliance
thereafter occurring. It is further agreed that all remedies, either under this
Agreement, by law, or otherwise afforded to either party shall be cumulative and
not alternative.
24. PREVAILING PARTY. If legal action is brought by, or on behalf of,
either party to enforce or interpret this Agreement, the prevailing party shall
be entitled to recover its attorneys' fees and legal costs in connection
therewith.
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IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement and Investment Letter this ____ day of ________________, 1999.
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Signature
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Print Name
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Number and Street
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City, State and Zip
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Subscriber's Social Security
or Tax Identification Number
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Signature of Co-owner if applicable
If Joint Ownership, check one (all parties must sign above):
( ) Joint Tenants with ( ) Tenants in Common
Right of Survivorship
( ) Community Property
If Fiduciary, Corporation or Partnership, check one:
( ) Trust ( ) Estate ( ) Power of Attorney
( ) Corporation ( ) Partnership
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Accepted as of __________, 1999
GALAGEN INC.
By:
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Name:
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Title:
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