SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1997
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________________ to ____________________
Commission File number 0-14656
REPLIGEN CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware 04-2729386
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
117 Fourth Avenue
Needham, Massachusetts 02194
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (781)-449-9560
-----------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes ____ No ____.
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of January 31, 1998.
Common Stock, par value $.01 per share 18,001,785
-------------------------------------- ----------------
Class Number of Shares
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REPLIGEN CORPORATION
Form 10-Q for the Quarter Ending December 31, 1997
INDEX
PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of December
31, 1997 and March 31, 1997 3
Condensed Consolidated Statements of Operations for
the Three and Nine Months Ended December 31, 1997
and 1996 4
Condensed Consolidated Statement of Cash Flows for
the Nine Months Ended December 31, 1997 and 1996 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities 9
Item 3. Defaults Upon Senior Securities
None
Item 4. Submissions of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K 10
(a) Exhibits
4.1 Form of Warrant
10.1 Stock and Warrant Purchase Agreement
27.1 Financial Data Schedule
(b) Reports on Form 8-K
2
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Signature 11
Exhibit Index 12
PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
3
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REPLIGEN CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
ASSETS December 31, 1997 March 31, 1997
----------------- --------------
Current assets:
Cash and cash equivalents $ 4,919,340 $ 3,465,881
Marketable securities -- 72,353
Accounts receivable 364,927 534,929
Inventories 528,379 452,241
Prepaid expenses and other current
assets 132,929 165,720
------------- -------------
Total current assets 5,945,575 4,691,124
Property, plant and equipment, at cost:
Equipment 770,512 724,564
Furniture and fixtures 31,807 28,820
Leasehold improvements
442,528 386,199
1,244,847 1,139,583
Less: accumulated depreciation and
amortization 532,048 349,112
------------- -------------
712,799 790,471
Restricted cash -- 50,087
Other assets, net 88,909 88,909
------------- -------------
$ 6,747,283 $ 5,620,591
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 64,660 $ 168,269
Accrued expenses 245,722 399,988
Unearned income -- 133,313
------------- -------------
Total current liabilities 310,382 701,570
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value --
authorized -- 5,000,000 shares --
outstanding - none -- --
Common stock, $.01 par value --
authorized -- 30,000,000 shares--
outstanding - 18,001,785 shares at
December 31, 1997 and 16,001,785 at
March 31, 1997 180,017 160,017
Additional paid-in capital 130,264,048 128,309,048
Deferred compensation (3,535) (26,447)
Accumulated deficit (124,003,629) (123,523,597)
------------- -------------
Total stockholders' equity 6,436,901 4,919,021
$ 6,747,283 $ 5,620,591
============= =============
See accompanying notes to condensed consolidated financial statements.
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REPLIGEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
December 31, December 31, December 31, December 31,
1997 1996 1997 1996
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Research and development $ 377,957 $ 440,180 $ 802,326 $ 890,641
Product 316,146 503,049 855,532 1,123,827
Investment income 44,862 98,744 159,968 206,543
Other 14,472 24,593 114,447 667,180
------------ ------------ ------------ ------------
753,437 1,066,566 1,932,273 2,888,191
------------ ------------ ------------ ------------
Costs and expenses:
Research and development 348,860 240,139 1,063,061 934,599
Selling, general and 300,609 353,775 922,818 1,540,137
administrative
Cost of goods sold 198,607 211,538 426,425 363,187
Charge for purchased research &
development -- 365,285 -- 365,285
------------ ------------ ------------ ------------
848,076 1,170,737 2,412,304 3,203,208
Net loss $ (94,639) $ (104,171) $ (480,031) $ (315,017)
============ ============ ============ ============
Basic loss per common share $ (.01) $ (.01) $ (0.03) $ (0.02)
============ ============ ============ ============
Weighted average common shares
outstanding 16,023,763 15,605,846 16,009,084 15,603,639
============ ============ ============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
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REPLIGEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
December 31,
-------------------------
1997 1996
----------- -----------
Cash flows from operating activities:
Net loss $ (480,031) $ (315,017)
Adjustments to reconcile net loss to net cash
used in operating activities -
Depreciation and amortization 182,935 128,709
Compensation charge from stock options 22,912 32,395
Charge for purchased research & development -- 365,285
Changes in assets and liabilities -
Accounts receivable 170,002 (242,720)
Amounts due from affiliates -- 42,284
Inventories (76,138) 256,784
Prepaid expenses and other current assets 32,791 35,187
Accounts payable (103,609) (292,254)
Accrued expenses (154,266) (3,388,055)
Unearned income (133,313) 78,316
----------- -----------
Net cash used in operating activities (538,717) (3,299,086)
----------- -----------
Cash flows from investing activities:
Decrease in marketable securities 72,353 137,704
Purchases of property, plant and equipment, net (105,264) (367,020)
Decrease in other assets -- 5,900
Decrease (increase) in restricted cash 50,087 (104,466)
----------- -----------
Net cash provided by (used in) investing
activities 17,176 (327,882)
----------- -----------
Cash flows from financing activities:
Net proceeds from the issuance of common stock
and warrants, net of issuance costs 1,975,000 --
----------- -----------
Net cash provided by financing activities 1,975,000 --
----------- -----------
Net increase (decrease) in cash and cash equivalents 1,453,459 (3,626,968)
Cash and cash equivalents, beginning of period 3,465,881 6,944,140
----------- ===========
Cash and cash equivalents, end of period $ 4,919,340 $ 3,317,172
=========== ===========
See accompanying notes to condensed consolidated financial statements.
6
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REPLIGEN CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The condensed consolidated financial statements included herein have been
prepared by Repligen Corporation (the "Company" or "Repligen"), pursuant to
the rules and regulations of the Securities and Exchange Commission for
quarterly reports on Form 10-Q and do not include all of the information and
footnote disclosures required by generally accepted accounting principles.
These financial statements should be read in conjunction with the audited
financial statements and notes thereto included in the Company's Form 10-K
for the year ending March 31, 1997.
In the opinion of management, the accompanying unaudited financial
statements include all adjustments consisting of only normal, recurring
adjustments necessary to present fairly, the consolidated financial
position, results of operations and cash flows. The results of operations
for the interim periods presented are not necessarily indicative of results
to be expected for the entire year.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Reclassifications have been made in prior year condensed consolidated
financial statements to conform with the current year's presentations.
2. Basic Loss Per Common Share
Basic loss per common share has been computed by dividing net loss by the
weighted average number of shares outstanding during the period. At December
31, 1997, there are 559,000 options outstanding, with a weighted average
exercise price of $1.36 and 2,832,000 warrants outstanding, with a weighted
average exercise price of $3.97. These common stock equivalents have not
been included for any period as the impact would be antidilutive.
In February 1997 the Financial Accounting Standard Board issued SFAS No.
128 Earnings Per Share, which requires a new method of calculating earnings
per share (EPS). The Company is required to use this method beginning with
the financial statements for period ended December 31, 1998. The reported
EPS will be unchanged from amounts presented in prior periods' interim
reports.
3. Cash Equivalents and Marketable Securities
The Company considers all highly liquid investments with a maturity of
three months or less at the time of acquisition to be cash equivalents.
Included in cash equivalents at December 31, 1997 are approximately
$1,600,000 of cash, $525,000 of money market funds and approximately
$2,800,000 investment in commercial paper. Investments with a maturity
period of greater than three months are classified as marketable securities.
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4. Inventories
Inventories are stated at the lower of cost (first-in, first-out) or
market and consist of the following:
December 31, March 31,
1997 1997
--------- ---------
Raw materials and work-in-process $ 343,000 $ 298,000
Finished goods 185,000 154,000
--------- ---------
Total $ 528,000 $ 452,000
========= =========
Work in process and finished goods inventories consist of material,
labor, outside processing and manufacturing overhead.
5. Stockholders' Equity
On December 31, 1997, the Company completed a $2.0 million private
placement of its securities. The Company received net proceeds of $1.975 million
for the issuance of 2,000,000 shares of Common Stock (the "Common Shares") and
warrants to purchase an aggregate of 750,000 shares of Common Stock.
8
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Statement Regarding Forward-Looking Statements
Statements in this Quarterly Report on Form 10-Q under this caption,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," as well as oral statements that may be made by the Company or by
officers, directors or employees of the Company acting on the Company's
behalf, that are not historical facts constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1996.
Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause the actual results of the
Company to be materially different from the historical results or from any
results expressed or implied by such forward-looking statements.
Certain Factors That May Affect Future Results
The Company's future operating results are subject to risks and
uncertainties and are dependent upon many factors, including, without
limitation, the Company's ability to (i) meet its working capital and future
liquidity needs, (ii) successfully implement its restructuring and strategic
growth strategies, (iii) understand, anticipate and respond to rapidly
changing technologies and market trends, (iv) develop, manufacture and
deliver high quality, technologically advanced products on a timely basis to
withstand competition from competitors which may have greater financial,
information gathering and marketing resources than the Company, (v) obtain
and protect licensing and intellectual property rights necessary for the
Company's technology and product development on terms favorable to the
Company, (vi) recruit and retain highly talented professionals in a
competitive job market. Each of these factors, and others, are discussed from
time to time in the filings made by the Company with the Securities and
Exchange Commission.
The Company
Repligen Corporation is developing a new class of synthetic drugs
designed to block important protein-carbohydrate and protein-protein
interactions. Although clinical experience with complex natural products and
monoclonal antibodies has shown that many of these interactions are important
in disease, it has not been possible to identify easily synthesized organic
compounds for these types of targets. Repligen is developing technologies to
discover drugs which can block protein-macromolecule interactions including
methods for the rapid synthesis of chemical compound libraries with "natural
product-like" complexity and high throughput screening assays based on
specific biological targets.
In a proprietary program these technologies are being applied to the
discovery of small molecule inhibitors for several growth factors responsible
for angiogenesis or new blood vessel growth. Compounds which inhibit
angiogenic growth factors may have application in certain ocular diseases
(including diabetic retinopathy or macular degeneration) and oncology. The
Company's high throughput screening assays can identify inhibitors of the
interaction of these growth factors with cell surface carbohydrates by
screening customized combinatorial chemical libraries. The Company also has
ongoing collaborations with Pfizer Inc., Glaxo Wellcome and Cambridge
NeuroScience based on its drug discovery technologies.
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Repligen also manufactures and markets a line of products for the
production of monoclonal antibodies intended for human clinical use. These
products are based on recombinant Protein A for which Repligen holds patents
in the United States and major foreign markets. In addition, the Company has
out-licensed certain intellectual property pertaining to its former programs
on biological products.
Results of Operations
Revenues
Total revenues for the three month periods ended December 31, 1997 and
1996 were $753,000 and $1,067,000, respectively, a decrease of approximately
29%. Year to date total revenues decreased approximately 33% to $1,932,000 at
December 31, 1997 from $2,888,000 at December 31, 1996. This decrease is
largely attributable to the one-time sales of securities and equipment for
approximately $505,000 reported as "Other Income" in the nine month period
ended December 31, 1996.
Research and development revenues for the three month period ended
December 31, 1997 were $378,000 compared to $440,000 in the comparable fiscal
1997 period. In the first nine months of fiscal 1998, the Company recorded
research and development revenues totaling $802,000 consisting primarily of
approximately $620,000 from contracted research and development programs and
$182,000 from licensing revenues. In the first nine months of fiscal 1997,
the Company recorded research and development revenues totaling $891,000
consisting primarily of $662,000 from contracted research and development
programs and $229,000 from licensing revenues.
Product revenues for the three months ended December 31, 1997 and 1996
were $316,000 and $503,000, respectively, and were $856,000 and $1,124,000
for the nine months ended December 31, 1997 and 1996, respectively. This
decrease is attributed to the timing of large production scale orders of
Protein A.
Investment income decreased in fiscal 1998 over the comparable three
and nine month periods in fiscal 1997 primarily due to lower average funds
available for investment.
Other revenues for the three and nine month periods ended December 31,
1997 decreased from the comparable fiscal 1997 periods primarily due to the
Company's one-time sales of equipment and furnishings of approximately
$205,000 and non-investment securities of approximately $300,000 during
fiscal 1997.
Expenses
Total expenses for the three month periods ended December 31, 1997 and
1996 decreased 28% to $848,000 from $1,171,000. This decrease is largely
attributable to the $365,000 charge for purchased research and development
that occurred in the quarter ended December 31,1997 relating to the
acquisition of Proscure, Inc. For the nine months ended December 31, 1997 and
1996, expenses were $2,412,000 and $3,203,000, respectively.
Research and development expenses for the three months ended December
31, 1997 and 1996 were $349,000 and $240,000, respectively, an increase of
45%. For the nine months ended
10
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December 31, 1997 and 1996, research and development expenses were
$1,063,000 and $935,000, respectively, an increase of 14%. This increase is
largely attributable to increased investment in the Company's proprietary
product development during fiscal 1998.
Selling, general and administrative expenses for the three month and
nine month periods ended December 31, 1997 were $301,000 and $923,000,
respectively, which reflects a decrease of $53,000 and $617,000,
respectively, from the comparable 1997 periods. These decreases resulted from
the reduction of administrative personnel and related expenses as part of the
Company's cost reduction efforts in April through June of 1996.
Cost of goods sold for the three month and nine month periods ended
December 31, 1997 were $199,000 and $426,000, respectively, as compared to
$212,000 and $363,000 for the three and nine months ended December 31, 1996.
Cost of goods sold in the three month periods ended December 31, 1997 and
1996 were 63% and 42% of product revenues, respectively. In the nine month
periods ended December 31, 1997 and 1996, cost of goods sold was 50% and 32%
of product sales, respectively. The increase in cost of sales as a percentage
of revenue is primarily a result of the realization of inventory that had
been previously reserved for in the three and nine month periods ended
December 31, 1996.
Liquidity and Capital Resources
The Company's total cash, cash equivalents and marketable securities
increased to $4,919,000 at December 31, 1997 from $3,538,000 at March 31,
1997, an increase of $1,381,000 or 39%. The increase reflects $2,000,000 of
proceeds (before expenses) resulting from the sale of Common Stock and
Warrants through a private placement that took place during the three months
ended December 31, 1997 offset by the net losses during the nine month period
ended December 31, 1997 of approximately $480,000, an increase in inventory
of $76,000, the reduction of accounts payable and accrued expenses of
$260,000, offset in part by the reduction in accounts receivables and prepaid
expenses of $203,000. Working capital increased to $5,635,000 at December 31,
1997 from $3,990,000 at March 31, 1997.
During the nine months ended December 31, 1997, the Company entered
into a $450,000 note receivable with a licensee for past due licensing fees.
As the Company has historically recorded licensing fees under this agreement
on a cash basis, the Company has not recorded this note receivable as an
asset. The note requires full payment of principal and interest in August
1998. The Company will continue to record this license fee on a cash basis.
The Company has funded operations primarily with cash derived from the
sales of its equity securities, revenue derived from research and development
contracts, product sales and investment income. The Company believes it has
sufficient cash equivalents and marketable securities to satisfy its working
capital and capital expenditure requirements for the next twenty-four months.
Should the Company need to secure additional financing to meet its future
liquidity requirements, there can be no assurances that the Company will be
able to secure such financing, or that such financing, if available, will be
on terms favorable to the Company.
On February 23, 1998, Nasdaq will initiate new requirements for listing
on the Nasdaq National Market. Currently, the Company believes it is in
compliance with all of the new requirements. There can be no assurance,
however, that the Company will be able to continue to satisfy all the
requirements issued by Nasdaq or that the Company's Common Stock will
continue
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to be listed on the Nasdaq National Market. Should it occur, the delisting of
the Company's Common Stock from the Nasdaq National Market could have a
material adverse effect on the Company's business, results of operations and
financial condition.
PART II. OTHER INFORMATION
Item 2. CHANGES IN SECURITIES
Pursuant to the Stock and Warrant Purchase Agreement dated as of
December 31, 1997 (the "Purchase Agreement") among the Company and
Biotechnology Value Fund, L.P., certain of its affiliates, and Four Partners,
L.P.(collectively, the "Purchasers"), the Purchasers invested an aggregate of
$2 million in exchange for 2,000,000 shares of the Company's Common Stock
(the "Common Shares"), and warrants to purchase at any time prior to December
31, 2004 an aggregate of 750,000 shares of Common Stock at a price per share
of $1.50.
The sale of the Common Shares and Warrants was made in reliance upon
the exemption from registration under section 4 (2) of the Securities Act as
transactions not involving any public offering. The Company has reason to
believe that the Purchasers were "accredited investors"(as such term is
defined in Regulation D of the Securities Acts), were familiar with and had
access to information concerning the operations and financial conditions of
the Company, and were acquiring the securities for investment and not with a
view to the distribution thereof. No underwriter was engaged in connection
with the foregoing issuance of securities.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
EXHIBIT DESCRIPTION
------- -----------
4.1 Form of Stock Purchase Warrant
10.1 Stock & Warrant Purchase Agreement
27.1 Financial Data Schedule
(b) Reports on Form 8-K
Current Report dated December 31, 1997 filed with the Securities and
Exchange Commission on January 2, 1998 relating to the Company's private
placement of stocks and warrants.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SIGNATURE
REPLIGEN CORPORATION
(Registrant)
Date: February 13, 1998 By: /S/ Walter C. Herlihy
--------------------------------
Chief Executive Officer
Signing on behalf of the Registrant
and as Principal Financial and
Accounting Officer
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REPLIGEN CORPORATION AND SUBSIDIARIES
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION PAGE
----------- ----------- ----
4.1 Form of Stock Purchase Warrant 15
10.1 Stock and Warrant Purchase Agreement 22
27.1 Financial Data Schedule 38
14
EXHIBIT 4.1 FORM OF STOCK PURCHASE WARRANT
THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF EXCEPT IN ACCORDANCE WITH THE REGISTRATION REQUIREMENTS OF SUCH ACT AND
APPLICABLE LAWS OR SOME OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
SUCH ACT AND APPLICABLE LAWS IS AVAILABLE WITH RESPECT THERETO. THIS WARRANT WAS
ISSUED PURSUANT TO THAT CERTAIN STOCK AND WARRANT PURCHASE AGREEMENT DATED
DECEMBER 31, 1997 AND MAY NOT BE TRANSFERRED, COMBINED, OR SPLIT UP WITHOUT THE
PRIOR WRITTEN CONSENT OF THE COMPANY. THE COMPANY WILL DELIVER A COPY OF SUCH
AGREEMENT TO THE HOLDER HEREOF UPON REQUEST.
No. ____ _________ Shares
of Common Stock
REPLIGEN CORPORATION
STOCK PURCHASE WARRANT
Expiration Date: December 31, 2004
Repligen Corporation, a Delaware corporation (the "Company"), hereby
certifies that _______________ (the "Warrantholder"), for value received, is
entitled, subject to the terms set forth below, to purchase from the Company at
any time or from time to time before the Expiration Date, as defined in Section
1, that number of fully paid and nonassessable shares of the Common Stock of the
Company (the "Common Stock") set forth above at an exercise price of $1.50 per
share (subject to adjustment pursuant to Section 6). This Warrant is issued
pursuant to the terms and conditions of that certain Stock and Warrant Purchase
Agreement dated as of December 31, 1997 among the Company and the Investors (as
defined therein).
As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:
The term "Company" includes any corporation which shall succeed to or
assume the obligations of the Company hereunder.
The term "Stock" shall mean the class of Common Stock of the Company and
any other securities or property of the Company or of any other person
(corporate or otherwise) which the Warrantholder at any time shall be entitled
to receive on the exercise hereof in lieu of or in addition to such Common
Stock, or which at any time shall be issuable in exchange for or in replacement
of such Common Stock.
1. Initial Exercise Date; Expiration. Subject to the provisions of Section
2, this Warrant may be exercised at any time or from time to time. It shall
expire at 5:00 p.m., Eastern time, on December 31, 2004 (the "Expiration Date").
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2. Exercise of Warrant; Redemption. (a) This Warrant may be exercised in
full or in part by the holder hereof by surrender of this Warrant, with the form
of "cash exercise" subscription attached hereto (the "Exercise Notice") duly
executed by such holder, to the Company at its principal office, accompanied by
payment, in cash or by certified or official bank check payable to the order of
the Company, of the purchase price of the shares of Stock to be purchased
hereunder.
(b) The Warrantholder may elect to receive, without the payment by the
Warrantholder of any additional consideration, shares equal to the value of this
Warrant or any portion hereof by the surrender of this Warrant or such portion
to the Company, with the redemption notice attached hereto (the "Redemption
Notice") duly executed, at the office of the Company. Thereupon, the Company
shall issue to the Warrantholder such number of fully paid and nonassessable
shares of Stock as is computed using the following formula:
X = Y (A-B) / A
where X = the number of shares to be issued to the Warrantholder pursuant
to this Section 2(b).
Y = the number of shares covered by this Warrant in respect of which
the net issue election is made pursuant to this Section 2(b).
A = the fair market value ("FMV") of one share of Common Stock, as
determined below, as at the time the net issue election is made
pursuant to this Section 2(b).
B = the Purchase Price in effect under this Warrant at the time the net
issue election is made pursuant to this Section 2(b).
For the purposes of this Section 2(b), FMV shall be determined at
the time of exercise and shall mean: (A) if the Common Stock is then publicly
traded, the average closing price in the over-the-counter market as reported by
NASDAQ or as quoted in the NASDAQ National Market System or on any national
securities exchange on which the Common Stock is traded for the ten (10) prior
trading days, or (B) if the Common Stock is not then publicly traded, the price
per share of Common Stock or Common Stock equivalent paid by investors to
purchase the Common Stock or Common Stock equivalent of the Company (taking into
account any consideration paid separately to acquire any security which is
exercisable for or convertible into Common Stock) in any arm's length equity
financing completed within the preceding six (6) months, or, if no such equity
financing has so occurred, a fair value as determined in good faith by the Board
of Directors of the Company (the "Board") or (C) in the case of a Business
Combination, the price per share of Common Stock paid in the Business
Combination or, if such payment is made by property other than cash, the fair
value of such property paid per share of Common Stock in the Business
Combination as determined in good faith by the Board. In the event that this
Warrant is exercised pursuant to this Section 2(b) in connection with a Business
Combination, the Company may elect to treat such exercise in accordance with
Section 5(d). In the event the Common Stock is not publicly traded, the Board of
Directors of the Company shall promptly respond in writing to a reasonable
inquiry by the holder hereof as to the fair market value of the Common Stock for
purposes of this Section 2(b).
(c) For any partial exercise or redemption pursuant to Section 2(a)
or 2(b) hereof, the Warrantholder shall designate in the Exercise Notice or
Redemption Notice (as the case may be) the number of shares of Stock that it
wishes to purchase or the aggregate number of underlying shares of Stock
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represented by the portion of the Warrant it wishes to redeem (as the case may
be). On any such partial exercise or redemption, the Company at its expense
shall forthwith issue and deliver to the Warrantholder a new warrant of like
tenor, in the name of the Warrantholder, which shall be exercisable for such
number of shares of Stock represented by this Warrant which have not been
purchased upon such exercise or redemption.
3. When Exercise or Redemption Effective. The exercise or redemption of
this Warrant shall be deemed to have been effected immediately prior to the
close of business on the business day on which this Warrant is surrendered to
the Company as provided in Section 2(a) or 2(b) (as the case may be).
4. Delivery on Exercise or Redemption. As soon as practicable after the
exercise or redemption of this Warrant in full or in part pursuant to Section
2(a) or 2(b), as the case may be, and in any event within five (5) business days
thereafter, the Company at its expense (including the payment by it of any
applicable issue taxes) will cause to be issued in the name of and delivered to
the Warrantholder, or as such Warrantholder may direct, a certificate or
certificates for the number of fully paid and nonassessable full shares of Stock
to which such holder shall be entitled on such exercise or redemption, together
with cash, in lieu of any fraction of a share, equal to such fraction of the
then FMV of one full share as determined in accordance with Section 2(b).
5. Business Combinations.
(a) In event of any merger, consolidation or sale of the outstanding
capital stock of the Company (in a single transaction or related series of
transactions), resulting in a change of ownership of two-thirds or more of the
voting power of the Company, or in the event of a sale of all or substantially
all of the assets of the Company (such merger, consolidation or sale referred to
hereinafter as a "Business Combination"), the Company shall have the right at
any time or times to redeem this Warrant in full or in part in accordance with
Section 2(b) and this Section 5.
(b) At least 10 days before the date fixed by the Company for
redemption pursuant to this Section 5, the Company shall mail, postage prepaid,
written notice to the Warrantholder (the "Company Redemption Notice"), at his
address shown on the records of the Company; provided, however, that the
Company's failure to give the Company Redemption Notice shall in no way affect
its right to redeem this Warrant as provided herein. The Company Redemption
Notice shall contain the following information:
(i) The redemption date(s);
(ii) The applicable FMV of the Common Stock determined in accordance
with Section 2(b) and the number of shares of Stock issuable to the
Warrantholder upon redemption; and
(iii) A statement that the Warrantholder is to surrender this
Warrant to the Company, at the place designated.
(c) The Warrantholder shall surrender this Warrant to the Company at
the place designated in the Company Redemption Notice. Thereupon, there shall be
issued to the Warrantholder a certificate or certificates for the number of
shares of Stock issuable pursuant to Section 2(b) (or such other consideration
as may be payable pursuant to Section 5(d)). The Company shall not be obligated
to issue certificates evidencing such shares of Stock or other consideration
unless this Warrant is either delivered to the Company or any transfer agent
designated by the Company or unless the Warrantholder notifies the Company or
such transfer agent that this Warrant has been lost, stolen or destroyed and
executes an
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agreement satisfactory to the Company to indemnify the Company from any loss
incurred by it in connection therewith.
(d) In lieu of issuing shares of Stock upon redemption of this
Warrant, the Company may, at its election, pay or issue, or cause to be paid or
issued, to the Warrantholder the amount of cash or number of shares of Stock or
other securities or property of the Company, or of the successor corporation,
resulting from the Business Combination to which such holder would have been
entitled upon such date if such holder had redeemed this Warrant pursuant to
Section 2(b) immediately prior thereto.
(e) In case at any time and from time to time, the Company shall
effect a Business Combination and the Company does not exercise its right to
redeem this Warrant in accordance with the foregoing provisions of this Section
5, then in such case, the holder of this Warrant, on the exercise hereof
pursuant to Section 1 at any time after the date of the consummation of such
Business Combination, shall receive, in lieu of the Common Stock or other
securities that would have been issuable upon such exercise prior to the
consummation of the Business Combination, the amount of cash or number of shares
of Stock or other securities or property of the Company, or of the successor
corporation, to which such holder would have been entitled upon the consummation
of such Business Combination if such holder had so exercised this Warrant
immediately prior thereto, all subject to further adjustment as provided in
Section 6 below.
6. Adjustment of Purchase Price and Number of Shares. The character of the
shares of Stock issuable upon exercise or redemption of this Warrant (or any
shares of stock or other securities at the time issuable upon exercise or
redemption of this Warrant) and the purchase price therefor, are subject to
adjustment upon the occurrence of the following events:
(a) Adjustment for Stock Splits, Stock Dividends, Recapitalizations,
etc. The exercise price of this Warrant and the number of shares of Stock
issuable upon exercise or redemption of this Warrant (or any shares of stock or
other securities at the time issuable upon exercise or redemption of this
Warrant) shall be appropriately adjusted to reflect any stock dividend, stock
split, combination of shares, reclassification, recapitalization or other
similar event affecting the number of outstanding shares of Stock (or such other
stock or securities). For example, if there should be a 2-for-1 stock split, the
exercise price would be divided by two and such number of shares would be
doubled.
(b) Adjustment for Other Dividends and Distributions. In case the
Company shall make or issue, or shall fix a record date for the determination of
eligible holders entitled to receive, a dividend or other distribution after
December 31, 1997 with respect to the Stock (or any shares of stock or other
securities at the time issuable upon exercise or redemption of the Warrant)
payable in (i) securities of the Company (other than shares of Stock) or (ii)
assets (excluding cash dividends paid or payable solely out of current or
retained earnings), then, in each case, the holder of this Warrant on exercise
or redemption hereof at any time after the consummation, effective date or
record date of such event, shall receive, in addition to the Stock (or such
other stock or securities) issuable on such exercise or redemption prior to such
date, the securities or such other assets of the Company to which such holder
would have been entitled upon such date if such holder had exercised or redeemed
this Warrant immediately prior thereto (all subject to further adjustment as
provided in this Warrant).
(c) Certificate as to Adjustments. In case of any adjustment or
readjustment in the price or kind of securities issuable on the exercise or
redemption of this Warrant, the Company will promptly give written notice
thereof to the holder of this Warrant in the form of a certificate, certified
and confirmed by the
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President of the Company, setting forth such adjustment or readjustment and
showing in reasonable detail the facts upon which such adjustment or
readjustment is based.
7. No Impairment. The Company will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of this Warrant against
impairment. Without limiting the generality of the foregoing the Company (a)
will not increase the par value of any shares of stock receivable on the
exercise or redemption of this Warrant above the amount payable therefor on such
exercise or redemption, (b) will at all times reserve and keep available a
number of its authorized shares of Stock, free from all preemptive rights
therein, which will be sufficient to permit the exercise or redemption of this
Warrant by the Warrantholder, and (c) shall take all such action as may be
necessary or appropriate in order that all shares of Stock as may be issued
pursuant to the exercise or redemption of this Warrant will, upon issuance, be
duly and validly issued, fully paid and nonassessable and free from all taxes,
liens and charges with respect to the issue thereof.
8. Notices of Record Date, etc. In the event of
(a) any taking by the Company of a record of the holders of any
class of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution, or any right to
subscribe for, purchase or otherwise acquire any shares of stock of any class or
any other securities or property, or to receive any other right, or
(b) any capital reorganization of the Company, any reclassification
or recapitalization of the capital stock of the Company, or any transfer of all
or substantially all the assets of the Company to or consolidation or merger of
the Company with or into any other person, or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company, or
(d) any proposed issue or grant by the Company of any shares of any
class or any other securities, or any right or option to subscribe for, purchase
or otherwise acquire any shares of stock of any class or any other securities,
then and in each such event the Company will mail to the holder hereof a notice
specifying (i) the date on which any such record is to be taken for the purpose
of such dividend, distribution or right, and stating the amount and character of
such dividend, distribution or right, (ii) the date on which any such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding-up is to take place, and the time,
if any is to be fixed, as of which the holders of record of Stock (or any shares
of stock or other securities at the time issuable upon the exercise or
redemption of this Warrant) shall be entitled to exchange their shares for
securities or other property deliverable on such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding-up, and (iii) the amount and character of
any stock or other securities, or rights or options with respect thereto,
proposed to be issued or granted, the date of such proposed issue or grant and
the persons or class of persons to whom such proposed issue or grant is to be
offered or made. Such notice shall be mailed at least 10 days prior to the date
therein specified.
9. Exchange of Warrant. On surrender for exchange of this Warrant,
properly endorsed, to the Company, the Company at its expense will issue and
deliver to, or on the order of, the holder thereof a new
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Warrant of like tenor, in the name of such holder calling in the aggregate on
the face thereof for the number of shares of Stock called for on the face of the
Warrant so surrendered.
10. Replacement of Warrant. On receipt by the Company of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and, in the case of any such loss, theft or
destruction of this Warrant, on delivery of an indemnity agreement reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of such Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
11. Investment Intent. Unless a current registration statement under the
Securities Act of 1933, as amended, shall be in effect with respect to the
issuance of the securities to be issued upon exercise or redemption of this
Warrant, the holder thereof, by accepting this Warrant, covenants and agrees
that, at the time of exercise or redemption hereof, and at the time of any
proposed transfer of securities acquired upon exercise or redemption hereof,
such holder will deliver to the Company a written statement that the securities
acquired by the holder upon exercise or redemption hereof are for the own
account of the holder for investment and are not acquire with a view to, or for
sale in connection with, any distribution thereof (or any portion thereof) and
with no present intention (at any such time) of offering and distributing such
securities (or any person thereof).
12. Transfer. This Warrant is not transferable without the prior written
consent of the Company.
13. No Rights or Liability as a Stockholder. This Warrant does not entitle
the Warrantholder to any voting rights or other rights as a stockholder of the
Company. No provisions hereof, in the absence of affirmative action by the
Warrantholder to purchase Stock, and no enumeration herein of the rights or
privileges of the Warrantholder shall give rise to any liability of such
Warrantholder as a stockholder of the Company.
14. Damages. The Company recognizes and agrees that the Warrantholder will
not have an adequate remedy if the Company fails to comply with the terms of
this Warrant and that damages will not be readily ascertainable, and the Company
expressly agrees that, in the event of such failure, it shall not oppose an
application by the holder of this Warrant or any other person entitled to the
benefits of this Warrant requiring specific performance of any and all
provisions hereof or enjoining the Company from continuing to commit any such
breach on the terms hereof.
15. Notices. All notices referred to in this Warrant shall be in writing
and shall be delivered personally or by certified or registered mail, return
receipt requested, postage prepaid and will be deemed to have been given when so
delivered or mailed (i) to the Company, at its principal executive offices and
(ii) to the Warrantholder, at such Warrantholder's address as it appears in the
records of the Company (unless otherwise indicated in accordance with the
provisions of this Section 15 by such holder).
16. Payment of Taxes. All shares of Stock issued upon the exercise of this
Warrant shall be validly issued, fully paid and nonassessable, and the Company
shall pay all taxes and other governmental charges that may be imposed in
respect to the issue or delivery thereof.
17. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
Warrantholder and the Company. This Warrant shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware. The headings
in this Warrant are for purposes of reference only, and shall not limit or
otherwise affect any of the terms hereof.
[THE REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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DATED: December 31, 1997
REPLIGEN CORPORATION
By: ________________________________
Title:
[Corporate Seal]
Attest:
_______________________________
Secretary
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EXHIBIT 10.1 STOCK AND WARRANT PURCHASE AGREEMENT
STOCK AND WARRANT PURCHASE AGREEMENT
THIS STOCK AND WARRANT PURCHASE AGREEMENT (this "Agreement") is made this
31st day of December 1997 by and among Repligen Corporation, a Delaware
corporation (the "Company"), and the several investors named in the attached
Schedule I (individually an "Investor" and collectively the "Investors").
WHEREAS, the Company desires to issue and sell to the Investors, and the
Investors desire to acquire (i) an aggregate of 2,000,000 shares (the "Shares")
of the Company's Common Stock, par value $.01 per share ("Common Stock"), and
(ii) warrants (the "Warrants") representing the right to purchase an aggregate
of 750,000 shares (the "Warrant Shares") of Common Stock at a price per share of
$1.50, substantially in the form attached hereto as Exhibit A;
WHEREAS, the Company and the Investors desire to set forth certain matters
to which they have agreed relating to the Shares and the Warrants;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained in this Agreement, the parties agree as follows:
ARTICLE I -- ISSUANCE OF SECURITIES; CLOSING
SECTION 1.1 Authorization of Shares and Warrants. Subject to the terms and
conditions of this Agreement, the Company has authorized the issuance of the
Shares and Warrants pursuant to this Agreement.
SECTION 1.2 Purchase and Sale of Shares and Warrants. Subject to the terms
and conditions of this Agreement and in reliance upon the representations and
warranties of the Company contained herein, each Investor agrees to purchase
from the Company, and the Company agrees to sell to each Investor, on the
Closing Date (as hereinafter defined) the number of Shares and Warrants to
purchase the number of Warrant Shares set forth opposite such Investor's name on
Schedule I.
SECTION 1.3 Closing. Subject to the satisfaction of the conditions set
forth in Articles IV and V hereof, the closing of the purchase and sale of the
Shares and Warrants (the "Closing") shall take place at a place and time (the
"Closing Date") mutually agreed by the Company and the Investors, but in any
event no later than December 31, 1997. At the Closing, the Company shall deliver
to each Investor (i) one or more stock certificates registered in the name of
such Investor representing the number of Shares set forth opposite such
Investor's name on Schedule I under the heading "Number of Shares", and (ii) a
Warrant to purchase the number of Warrant Shares set forth opposite such
Investor's name on Schedule I under the heading "Number of Warrant Shares"
registered in the name of such Investor, against payment to the Company by such
Investor by wire transfer of immediately available funds of the purchase price
therefor set forth opposite the name of such Investor on Schedule I under the
heading "Aggregate Purchase Price".
SECTION 1.4 Allocation of Purchase Price. The Company and the Investors,
having adverse interests and as a result of arm's length bargaining, agree that
(i) neither the Investors nor any affiliates of the Investors has rendered or
has agreed to render any services to the Company in connection with this
Agreement or the issuance of the Shares and the Warrants; (ii) the Warrants are
not being issued as compensation; and (iii) for the purpose, and within the
meaning, of Section 1273(c)(2) of the Internal Revenue Code of 1986, as amended
(the "Code"), the issue price of the Shares is $0.9625 per Share and the
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issue price for the Warrants is $0.10 per Warrant Share. The Company and the
Investors acknowledge that this allocation is based on the relative fair market
values of the Shares and the Warrants. The Company and the Investors recognize
that this Agreement determines the original issue discount to be taken into
account by the Company and the Investors for federal income tax purposes on the
Shares and they agree to adhere to this Agreement for such purposes.
ARTICLE II -- REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company hereby represents and warrants to each Investor that, as of
the date of this Agreement, the following are true and correct:
SECTION 2.1 Organization and Standing of the Company. The Company is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware. The Company has full corporate power and
authority to enter into, deliver, and perform its obligations and undertakings
under this Agreement and the Warrants. The Company is duly authorized to conduct
business and is in good standing under the laws of each jurisdiction where such
qualification is required, except where the lack of such qualification would not
have a material adverse effect on the business, financial condition, operations,
results of operations, or future prospects of the Company. The Company has full
corporate power and authority to carry on the business in which it is engaged
and to own and use the properties owned and used by it.
SECTION 2.2 Capitalization. The Company's entire authorized capital stock
consists of 30,000,000 shares of Common Stock, and 5,000,000 shares of Preferred
Stock, $.01 par value per share (the "Preferred Stock"). As of September 30,
1997, there were outstanding 16,001,785 shares of Common Stock and no shares of
Preferred Stock. All such outstanding shares are validly issued, fully paid, and
non-assessable. Other than as indicated in the SEC Reports (as hereinafter
defined), the Company does not have outstanding any option, warrant, purchase
right, subscription right, stock appreciation right, phantom stock right, profit
participation right, agreement, or other commitment to issue or to acquire any
shares of its capital stock, or any securities or obligations convertible into
or exchangeable for its capital stock, and the Company has not given any person
any right to acquire from the Company or sell to the Company any shares of its
capital stock. There are no voting trusts, proxies, or other agreements or
understandings with respect to the voting of the capital stock of the Company.
SECTION 2.3 Validity of this Agreement and Warrants. The execution and
delivery by the Company of this Agreement and the Warrants and the performance
by the Company of its obligations hereunder and thereunder, and the issue, sale,
and delivery of the Shares, the Warrants and, upon exercise of the Warrants, the
Warrant Shares, have been duly authorized and approved by all necessary
corporate action. This Agreement has been duly executed and delivered by the
Company and constitutes a valid and binding obligation of the Company,
enforceable in accordance with its terms. The Warrants, when executed and
delivered in accordance with this Agreement, will constitute the legal, valid
and binding obligation of the Company, enforceable against the Company in
accordance with their terms. The execution and delivery by the Company of this
Agreement and the Warrants and the performance by the Company of its obligations
hereunder and thereunder, the issuance, sale, and delivery of the Shares, the
Warrants and, upon exercise of the Warrants, the Warrant Shares, will not (i)
conflict with, or result in, any breach of any of the terms of, or constitute a
default under, the Certificate of Incorporation or By-Laws of the Company; or
(ii) conflict with, result in a breach of, constitute a default under, result in
the acceleration of, create in any party the right to
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accelerate, terminate, modify, or cancel or require any notice under any
agreement, instrument, covenant, or other restriction or arrangement to which
the Company is a party or by which it or any of its properties or assets is
bound.
SECTION 2.4 Governmental Consent, etc. Except for filings, consents,
permits, approvals, and authorizations, which will be obtained by the Company
prior to the Closing and which are set forth in Schedule 2.4, no consent,
approval, authorization, or other order of, action by, filing with, or
notification to any governmental authority is required under existing law or
regulation in connection with the execution, delivery, and performance of the
Agreement or the Warrants, or the offer, issue, sale or delivery of the Shares
and the Warrants pursuant to the Agreement, or the Warrant Shares issued upon
exercise of the Warrants, or the consummation of any other transactions
contemplated thereby.
SECTION 2.5 Valid Issuance of Shares, Warrants and Warrant Shares. When
issued and delivered against payment therefor in accordance with the terms and
conditions of this Agreement, the Shares shall be (i) duly authorized and
validly issued, fully paid and non-assessable and (ii) not subject to any
preemptive rights, liens, claims or encumbrances, or other restrictions on
transfer or other agreements or understandings with respect in the voting of the
Common Stock. The Warrants, when issued and delivered against payment therefor
in accordance with the terms and conditions of this Agreement, shall be free and
clear of all liens, charges, restrictions and encumbrances imposed by or through
the Company except as set forth in the Warrants. The Warrant Shares have been
duly authorized and, when issued in accordance with the terms of the Warrants,
will be (X) duly authorized and validly issued, fully paid and non-assessable
and (Y) not subject to any preemptive rights, liens, claims or encumbrances, or
other restrictions on transfer or other agreements or understandings with
respect in the voting of the Common Stock. The Warrant Shares have been duly
reserved for issuance upon exercise of the Warrants.
SECTION 2.6 Financial Statements. The Common Stock is registered pursuant
to Section 12(g) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Copies of all reports filed by the Company with the United
States Securities and Exchange Commission (the "Commission") pursuant to the
Exchange Act during the period from March 31, 1997 to the date of this Agreement
(the "SEC Reports") have been furnished to the Investors. The audited financial
statements of the Company contained in the Company's Annual Report on Form 10-K
for the year ended March 31, 1997, including the notes relating thereto,
disclose all material liabilities of the Company as of the date thereof. Such
financial statements, including the notes relating thereto, have been prepared
in accordance with generally accepted accounting principles consistently applied
throughout the periods involved. Said financial statements and related notes
fairly present the financial position and the results of operations and cash
flow of Company as of the respective dates thereof and for the periods
indicated. Since September 30, 1997, there has not been any material adverse
change in the business, financial condition, operations, results of operations,
assets, employee relations, customer or supplier relations or future prospects
of the Company, except continuing operating losses, depletion of cash resources
and changes in the ordinary course of business.
SECTION 2.7 No Violation. Neither the execution and delivery by the
Company of this Agreement and the Warrants, nor the consummation of the
transactions contemplated hereby or thereby, will violate any constitution,
statute, rule, injunction, judgment, order, decree, ruling, charge or other
restriction of any government, governmental agency, or court known to the
Company to which the Company is subject, or any provision of its Certificate of
Incorporation or By-Laws.
SECTION 2.8 Title to Assets. The Company has such title to its property
and such rights and franchises as are necessary to operate the Company in the
manner contemplated by this Agreement.
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SECTION 2.9 Securities Laws. All notices, filings, registrations, or
qualifications under state securities or "blue sky" laws, which are required in
connection with the offer, issue, and delivery of the Shares and Warrants
pursuant to this Agreement, and the issuance of the Warrant Shares upon exercise
of the Warrants, if any, have been, or will be, completed by the Company.
ARTICLE III -- REPRESENTATIONS AND
WARRANTIES OF THE INVESTORS
Each Investor severally and not jointly hereby acknowledges, represents,
warrants, and agrees as follows:
SECTION 3.1 Authority of Investor; Validity of this Agreement. The
Investor has all requisite power and authority to enter into this Agreement and
perform its obligations hereunder. The execution, delivery, and performance by
the Investor of this Agreement, and the purchase of the Shares and the Warrants
have been duly authorized and approved by all necessary corporate action. This
Agreement has been duly executed and delivered and constitutes a valid and
binding obligation of the Investor, enforceable in accordance with its terms,
subject to laws of general application from time to time in effect affecting
creditors' rights, and the exercise of judicial discretion in accordance with
general equitable principles. The execution, delivery, and performance of this
Agreement and the purchase of the Shares and Warrants will not conflict with, or
result in, a material breach of any of the terms of, or constitute a material
default under, any charter, by-law, agreement, instrument, covenant, or other
restriction to which the Investor is a party or by which it or any of its
properties or assets is bound.
SECTION 3.2 Investment Representations. Each Investor severally and not
jointly hereby acknowledges, represents, warrants, and agrees as follows:
The Investor has reviewed the SEC Reports and the financial statements
contained therein. The Investor acknowledges that the Company has made available
to the Investor all documents and information that it has requested relating to
the Company and has provided answers to all of its questions concerning the
Company, the Shares and the Warrants.
The Investor is an "accredited investor," as defined in Rule 501(a)(3) of
the Securities Act.
The Investor understands that the offering of the Shares, the Warrants and
the Warrant Shares have not been registered under the Securities Act or the
securities laws of any state or other jurisdiction and that the Shares, the
Warrants and, upon exercise of the Warrants, the Warrant Shares must be held
indefinitely unless an exemption from registration is available. The Investor
understands that the offering and the sale of the Shares, the Warrants and the
Warrant Shares is intended to be exempt from registration under the Securities
Act, by virtue of Section 3(b), Section 4(2), and/or Section 4(6) of the
Securities Act and the provisions of Regulation D promulgated thereunder, based,
in part, upon the representations, warranties, and agreements of the Investor
contained in this Agreement, and the Company may rely on such representations,
warranties, and agreements in connection therewith. The Investor will not
transfer the Shares, Warrants or Warrant Shares in violation of the provisions
of any applicable Federal or state securities statute.
The Investor is acquiring the Shares and Warrants for investment, and not
with a view to the resale or distribution thereof; it has no present intention
of selling, negotiating, or otherwise disposing of the Shares or Warrants. The
Investor's financial condition and investments are such that it is in a
financial position to hold the Shares, Warrants, and Warrant Shares for an
indefinite period of time and to bear the economic risk of, and withstand a
complete loss of, the Shares, Warrants or Warrant Shares. In addition, by virtue
of its expertise, the advice available to it, and its previous investment
experience, the Investor has sufficient
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knowledge and experience in financial and business matters, investments,
securities, and private placements and the capability to evaluate the merits and
risks of the transactions contemplated by this Agreement.
ARTICLE IV -- CONDITIONS TO
INVESTORS' OBLIGATIONS
SECTION 4.1 Conditions to Closing on Closing Date. The obligations of the
Investors to purchase and pay for the Shares and Warrants on the Closing Date is
subject to the following:
(a) Representations and Warranties. The representations and
warranties of the Company made herein shall be true, correct, and complete on
and as of the Closing Date with the same force and effect as if they had been
made on and as of the Closing Date.
(b) Performance. All covenants, agreements, and conditions contained
in this Agreement to be performed or complied with by the Company on or prior to
the Closing Date shall have been performed or complied with.
(c) Opinion of Company's Counsel. The Investors shall have received
an opinion of Testa, Hurwitz & Thibeault, LLP, counsel for the Company,
substantially in the form of Exhibit B hereto.
(d) Corporate Proceedings, Consents, etc. All corporate and other
proceedings to be taken, and all waivers and consents to be obtained, in
connection with the transactions contemplated by this Agreement shall have been
taken or obtained, and all documents incident thereto shall be reasonably
satisfactory in form and substance to the Investors and their counsel, each of
whom shall have received all such originals or certified of other copies of such
documents as each may reasonably request.
(e) No Proceeding. No action, suit, investigation or proceeding
shall be pending or threatened before any court or governmental agency to
restrain, prohibit, collect damages as a result of or otherwise challenge this
Agreement or any transaction contemplated hereby or thereby.
(f) No Law Prohibiting or Restricting such Sale. There shall not be
in effect any law, rule or regulation prohibiting or restricting such sale, or
requiring any consent or approval of any person which shall not have been
obtained to issue the Shares and Warrants (except as otherwise provided in this
Agreement).
(g) Officer's Certificate Delivered by Company. The Company shall
have delivered to the Investors a certificate, dated the Closing Date and signed
by the Chief Executive Officer or the President of the Company, to the effect
that each of the conditions to be satisfied by the Company pursuant to this
Section 4.1 on or before each Closing Date has been duly satisfied.
(h) No Material Adverse Change. There shall have been no material
adverse change in the financial condition of the Company since the date of
signing of the Agreement.
(i) Legal Matters. All material matters of a legal nature which
pertain to this Agreement and the transactions contemplated hereby shall have
been reasonably approved by counsel to the Investor.
ARTICLE V -- CONDITIONS TO THE COMPANY'S OBLIGATIONS
SECTION 5.1 Conditions to Closing. The obligation the Company to issue the
Shares and Warrants to the Investors on the Closing Date is subject to the
following:
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(a) Representations and Warranties. The representations and
warranties of the Investors made herein shall be true, correct and complete in
all respects on and as of the Closing Date with the same force and effect as if
they had been made on and as of the Closing Date.
(b) No Order Pending. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement.
(c) No Law Prohibiting or Restricting such Sale. There shall not be
in effect any law, rule or regulation prohibiting or restricting such sale, or
requiring any consent or approval of any person which shall not have been
obtained to issue the Shares and Warrants (except as otherwise provided in this
Agreement).
ARTICLE VI -- CERTAIN AGREEMENTS OF THE PARTIES
SECTION 6.1 Furnishing of Information. As long as an Investor owns at
least 75% of the Shares originally purchased by it pursuant to this Agreement,
the Company covenants to timely file (or obtain extensions in respect thereof)
all reports required to be filed by the Company after the date hereof pursuant
to Section 13(a) or 15(d) of the Exchange Act and to promptly furnish such
Investor with true and complete copies of all such filings. If the Company is
not at the time required to file reports pursuant to such sections, it will
prepare and furnish to such Investor annual and quarterly reports comparable to
those required by Section 13(a) or 15(d) of the Exchange Act in the time period
that such filings would have been required to have been made under the Exchange
Act.
SECTION 6.2 Sale or Transfer of Securities. (a) Each of the Investors
agrees that the Warrants may not be transferred or split up by such Investor
without the prior written consent of the Company. The Warrants shall bear a
legend substantially in the following form:
THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THE
REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS OR SOME
OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND
APPLICABLE LAWS IS AVAILABLE WITH RESPECT THERETO. THIS WARRANT WAS
ISSUED PURSUANT TO THAT CERTAIN STOCK AND WARRANT PURCHASE AGREEMENT
DATED DECEMBER 31, 1997 AND MAY NOT BE TRANSFERRED, COMBINED, OR
SPLIT UP WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMPANY. THE
COMPANY WILL DELIVER A COPY OF SUCH AGREEMENT UPON REQUEST.
(c) The Shares and Warrant Shares shall not be sold or transferred
unless either (i) they shall have been registered under the Securities Act, or
(ii) the Company shall have been furnished with an opinion of legal counsel,
reasonably satisfactory to the Company, to the effect that such sale or transfer
is exempt from the registration requirements of the Securities Act.
(d) Each certificate representing Shares and Warrant Shares shall
bear a legend substantially in the following form:
27
<PAGE>
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND
UNTIL SUCH SECURITIES ARE REGISTERED UNDER SUCH ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT
SUCH REGISTRATION IS NOT REQUIRED.
SECTION 6.3 Registration Procedures and Expenses. The Company shall:
(a) prepare and file with the SEC a registration statement (the
"Share Registration Statement") covering the resale of the
Shares by the Investors from time to time on the Nasdaq
National Market or on such securities market or system on
which the Company's Common Stock shall then be publicly
traded, or in privately negotiated transactions, no later than
180 days following the Closing Date.
(b) use best efforts, within 90 days after the written request
(the "Demand Request") of the holders of at least 500,000
Warrant Shares, to prepare and file with the SEC a
registration statement (the "Warrant Share Registration
Statement") covering the resale by the Investors of the
Warrant Shares then outstanding on the Nasdaq National Market
or on such securities market or system on which the Company's
Common Stock shall then be publicly traded, or in privately
negotiated transactions. Within 10 business days of its
receipt of the Demand Notice, the Company shall give written
notice (the "Company Notice") to all Investors holding
Warrants and/or Warrant Shares of its intention to effect the
Warrant Share Registration Statement and will include in the
Warrant Share Registration Statement all Warrant Shares that
are outstanding and with respect to which the Company has
received written requests for inclusion therein within 15 days
after the receipt of the Company Notice;
(c) use its best efforts, subject to receipt of necessary
information from each Investor, to cause the Share
Registration Statement and the Warrant Share Registration
Statement (collectively the "Registration Statements" and
individually, a "Registration Statement") to become effective
as soon as possible after filing thereof;
(d) prepare and file with the SEC such amendments and supplements
to the Registration Statements and the prospectus used in
connection therewith as may be necessary to comply with the
provisions of the Securities Act (i) in the case of the Share
Registration Statement, until the later of such time as all of
the Shares have been sold pursuant thereto or, by reason of
Rule 144(k) under the Securities Act or any other rule of
similar effect, such shares are no longer required to be
registered for the unrestricted sale thereof by the Investor;
and, (ii) in the case of the Warrant Share Registration
Statement, until the later of 90 days after the Warrant Share
Registration Statement becomes effective or such time as all
of the Warrant Shares registered thereunder have been sold
pursuant thereto or, by reason of Rule 144(k) under the
Securities Act or any other rule of similar effect, such
shares are no longer required to be registered for the
unrestricted sale thereof by the Investors;
(e) furnish to the Investors such number of copies of prospectuses
and preliminary prospectuses in conformity with the
requirements of the Securities Act and such other documents as
the Investors may reasonably request, in order to facilitate
the public sale or other disposition of all or any of the
Shares and Warrant Shares held by the Investors, provided,
however, that
28
<PAGE>
the obligation of the Company to deliver copies of
prospectuses or preliminary prospectuses to the Investors
shall be subject to the receipt by the Company of reasonable
assurances from the Investors that the Investors will comply
with the applicable provisions of the Securities Act and of
such other securities or blue sky laws as may be applicable in
connection with any use of such prospectuses or preliminary
prospectuses;
(f) file documents required of the Company for normal blue sky
clearance in all states, 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;
(g) bear all expenses in connection with the procedures in
paragraphs (a) through (c) of this Section 6.3, other than
brokerage commissions or placement agent fees and fees and
expenses, if any, of counsel or other advisers to the
Investors with respect to the registration and resale of the
Shares and Warrant Shares; and
(h) prepare and file additional listing applications for the
Shares and Warrant Shares on the Nasdaq National Market or on
such securities market or system on which the Company's Common
Stock shall then be publicly traded;
provided; that the Company shall not be obligated to prepare or file a Warrant
Share Registration Statement or take any of the other actions set forth above
with respect to the Warrant Share Registration Statement if, at the time of
exercise of the Warrants, by reason of Rule 144(k) under the Securities Act or
any other rule of similar effect, the Warrant Shares are no longer required to
be registered for the unrestricted sale thereof by the Investors.
The Company understands that each Investor disclaims being an underwriter, but
an Investor being deemed an underwriter shall not relieve the Company of any
obligations it has hereunder.
SECTION 6.4 Transfer of Securities After Registration. (a) Each Investor
agrees that it will not effect any disposition of the Shares or Warrant Shares
that would constitute a sale within the meaning of the Securities Act except as
contemplated in the Registration Statements referred to in Section 6.3 or
pursuant to an available exemption from registration under the Securities Act
and applicable state securities laws.
(b) Notwithstanding anything to the contrary in this Agreement, if
at any time and from time to time after the first date of effectiveness of the
Registration Statement the Company notifies the Investors in writing of the
existence of a Potential Material Event, the Investors and any other persons who
hold shares of Common Stock registered pursuant to Section 6.3 shall not offer
or sell any shares of Common Stock, or engage in any other transaction involving
or relating to the Common Stock, from the time of the giving of such notice
until the earliest to occur of (a) the public disclosure by the Company of the
Potential Material Event, (b) receipt of written notice from the Company that
such Potential Material Event no longer exists, or (c) the date 20 days after
the date of the notice of such Potential Material Event. The Company may
exercise its right to notify the Investors of the existence of a Potential
Material Event pursuant to this Section 6.4(b) only twice.
(c) For purposes of this Agreement, "Potential Material Event" shall
mean any of the following: (a) the possession by the Company of material
information not ripe for disclosure in a registration statement, which shall be
evidenced by determinations in good faith by the Board of Directors of the
Company that disclosure of such information would be detrimental to the business
and affairs of the
29
<PAGE>
Company and that the registration statement would be materially misleading
absent the inclusion of such information; or (b) any material engagement or
activity by the Company which would, in the good faith determination of the
Board of Directors of the Company, be adversely affected by disclosure in a
registration statement at such time, which determination shall be accompanied by
a good faith determination by the Board of Directors of the Company that the
registration statement would be materially misleading absent the inclusion of
such information.
SECTION 6.5 Indemnification. For the purpose of this Section 6.5:
(a) the term "Selling Shareholder" shall mean any person or entity
selling Shares and/or Warrant Shares pursuant to a Registration Statement, and
any affiliate thereof;
(b) the term "Registration Statement" shall include any preliminary
prospectus, final prospectus, exhibit, supplement or amendment included in or
relating to the Registration Statement; and
(c) the term "untrue statement" shall mean any untrue statement or
alleged untrue statement of a material fact in the Registration Statement, or
any omission or alleged omission to state in the Registration Statement 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.
The Company agrees to indemnify and hold harmless each Selling
Shareholder from and against any losses, claims, damages or liabilities to which
such Selling Shareholder may become subject (under the Securities Act or
otherwise) insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon, any untrue
statement, or arise out of any failure by the Company to fulfill any undertaking
included herein or in the Registration Statement, and the Company promptly will
reimburse such Selling Shareholder for any legal or other expenses reasonably
incurred in investigating, defending or preparing to defend 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 or liability arises
out of, or is based upon, an untrue statement made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Selling Shareholder specifically for use in preparation of the Registration
Statement, or the failure of such Selling Shareholder to comply with the
covenants and agreements contained herein; provided further, that the
indemnification contained in this Section 6.5 with respect to any prospectus
after it has been amended or supplemented, shall not inure to the benefit of any
Selling Shareholder (or any person controlling such Selling Shareholder) from
whom the person asserting such loss, claim, damage, or liability shall have
purchased Shares and/or Warrant Shares, that are the subject thereof if, after
copies thereof have been delivered by the Company to such Selling Shareholder,
such Selling Shareholder shall have failed to send or give a copy of the
prospectus as then amended or supplemented, as the case may be, to such person
at or prior to the confirmation of such sale of such Shares or Warrant Shares,
as the case may be, to such person, and, if such loss, claim, damage or
liability would not have arisen but for the failure of such Selling Shareholder
to deliver the same.
Each Investor agrees to indemnify and hold harmless the Company (and
each other 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 or liabilities 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 or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, any failure of such Investor to comply with its covenants and
agreements contained herein, or any untrue statement if such untrue statement
was made in reliance upon and in conformity with written information furnished
by or on behalf of such Investor
30
<PAGE>
specifically for use in preparation of the Registration Statement, and such
Investor promptly 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 any such
action, proceeding or claim.
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 6.5, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and such indemnifying person shall have been notified
thereof, such indemnifying person shall be entitled to participate therein, and,
to the extent it shall wish, 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. In the event that the
indemnifying party shall have assumed the defense of such action, such
indemnifying party shall not enter into any compromise or settlement without the
indemnified party's prior written consent, which consent shall not be
unreasonably withheld, delayed or denied.
SECTION 6.6 Termination of Conditions and Obligations. The restrictions
imposed by Sections 6.2 and 6.4 upon the transferability of the Shares and
Warrant Shares shall cease and terminate as to any particular Shares or Warrant
Shares when such Shares or Warrant Shares, as the case may be, 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 or at such time as an opinion of counsel satisfactory to
the Company shall have been rendered to the effect that such restrictions are
not necessary in order to comply with the Securities Act.
SECTION 6.7 Information Available. So long as the Registration Statement
is effective covering the resale of Shares and Warrant Shares owned by an
Investor, the Company will furnish to such Investor upon request:
(a) any document filed by the Company with the SEC;
(b) upon the reasonable request of such Investor, any other
information concerning the Company that is generally available
to the public; and
(c) an adequate number of copies of the prospectuses relating to
the resale of the Shares and Warrant Shares to supply to any
party requiring such prospectuses.
SECTION 6.8 "Lock-Up" Agreement. If the Company proposes to offer for sale
to the public any of its equity securities, and (i) if an Investor is an
"affiliate" of the Company or otherwise holds beneficially or of record ten
percent (10%) or more of the outstanding equity securities of the Company, (ii)
if requested by the Company and an underwriter of shares of Common Stock or
other securities of the Company and (iii) if all other "affiliates" and 10%
stockholders that purchased securities directly from the Company after the date
hereof pursuant to a private placement of securities have signed or are
contractually obligated to sign a lock-up agreement (as described below), then
such Investor shall not offer, sell, grant any option or right to buy or sell,
or otherwise transfer or dispose of in any manner any Common Stock or other
securities of the Company held by it during the 90-day period following the
effective date of the registration statement of the Company filed under the
Securities Act and will sign a "lock-up agreement" to such effect. Such
agreement shall be in writing and in form and substance reasonably satisfactory
to the Company and such underwriter and pursuant to customary and prevailing
terms and conditions. The Company may impose stop-
31
<PAGE>
transfer instructions with respect to the securities subject to the foregoing
restrictions until the end of such 90-day period.
SECTION 6.9 Nontransferability. The registration rights granted in this
Article VI may not be assigned or transferred in connection with a sale of
Shares, the Warrants or the Warrant Shares, or otherwise.
ARTICLE VII -- SURVIVAL AND INDEMNIFICATION
SECTION 7.1 Survival. Notwithstanding any examination made by or on behalf
of any party hereto, the knowledge of any party or the acceptance by any party
of any certificate or opinion, each representation, warranty or covenant
contained herein shall survive the Closing and shall be fully effective and
enforceable for two years after the Closing.
SECTION 7.2 Indemnification.
(a) The Company shall indemnify each Investor, its shareholders,
officers, directors, employees, agents and representatives against any damages,
claims, losses, liabilities and expenses (including reasonable counsel fees and
expenses) which may be suffered or incurred by any of them as a result of a
breach of any representation, warranty or covenant made by the Company in this
Agreement;
(b) Each Investor agrees to indemnify the Company and its
shareholders, officers, directors, employees, agents and representatives against
any damages, claims, losses, liabilities and expenses (including reasonable
counsel fees and other expenses) which may be suffered or incurred by it as a
result of any breach of any representation, warranty, or covenant made by such
Investor in this Agreement; and
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to this Section, such person (the "indemnified
party") shall promptly notify the person against whom such indemnity may be
sought (the "indemnifying party") in writing of the occurrence of the facts and
circumstances giving rise to such claim. The failure of any person to deliver
the notice required by this Section 7.2(c) shall not in any way affect the
indemnifying party's indemnification obligations hereunder except and only to
the extent tat the indemnifying party is actually prejudiced thereby. In case
any such proceeding shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
which, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party and
shall pay as incurred the fees and expenses of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right
to retain its own counsel or pay its own expenses. Notwithstanding the
foregoing, the indemnifying party shall pay as incurred the fees and expenses of
the counsel retained by the indemnified party in the event (i) the indemnifying
party and the indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceedings (including any
impleaded parties) include both the indemnify party and the indemnified party
and representations of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. The indemnifying
party shall not be liable for any settlement of any proceeding effected without
its written consent but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against an loss or liability by reason of such
settlement or judgment.
32
<PAGE>
ARTICLE VIII -- MISCELLANEOUS
SECTION 8.1 Notices. All notices, requests, consents and other
communications hereunder shall be in writing, shall be addressed to the
receiving party's address set forth below or to such other address as a party
may designated by notice hereunder, and shall be either (i) delivered by hand,
(ii) made by telex, telecopy or facsimile transmission, (iii) sent by overnight
courier, or (iv) sent by registered mail, return receipt requested, postage
prepaid.
If to an Investor: The address specified on Schedule I.
With a copy to: Sidley & Austin
875 Third Avenue
New York, NY 10022
Attention: David Ridl, Esq.
Facsimile: 212-906-2021
If to the Company: Repligen Corporation
117 Fourth Avenue
Needham, MA 02194
Attention: Chief Executive Officer
Facsimile: 781-453-0048
With a copy to: Testa, Hurwitz & Thibeault, LLP
125 High Street
Boston, MA 02110
Attention: Lawrence S. Wittenberg, Esq.
Facsimile: 617-248-7100
All notices, requests, consents and other communications hereunder shall be
deemed to have been given together (i) if by hand, at the time of the delivery
thereof to the receiving party at the address of such party set forth above;
(ii) if my telex, telecopy or facsimile transmission, one (1) day after the time
that receipt thereof has been acknowledged by electronic confirmation or
otherwise; (iii) if sent by overnight courier, on the next business day
following the day such notice is delivered to the courier service; or (iv) if
sent by registered mail, on the 5th business day following the day such mailing
is made.
SECTION 8.2 Entire Agreement. This Agreement, including exhibits, or other
documents referred to herein or that specifically indicate that they were
delivered to the Investors in connection with this Agreement, embodies the
entire agreement and understanding between the parties hereto with respect to
the subject matter hereof and supersedes all prior oral or written agreements
and understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement or in any document that specifically indicates that it
was delivered to the Investors in connection with this Agreement shall affect,
or be used to interpret, change or restrict, the express terms and provisions of
this Agreement.
SECTION 8.3 Amendments. The terms and provisions of the Agreement may be
modified, amended or waived, or consent for the departure therefrom granted,
only by written consent of the Company and the Investors holding at least 50% of
the Shares then held by all Investors. No such waiver or consent shall be deemed
to be an Agreement, whether or not similar. Each such waiver or consent shall be
effective only
33
<PAGE>
in the specific instance and for the purpose for which it was given, and shall
not constitute a continuing waiver or consent.
SECTION 8.4 Assignment. The rights and obligations under this Agreement
may not be assigned by any party hereto without the prior written consent of the
Company and Investors holding in the aggregate at least 50% of the Shares then
held by all Investors. Neither this Agreement not any or all of the rights and
obligations of a party hereunder shall be assigned, delegated, sold, transferred
or otherwise disposed of by operation of law or otherwise, to any third person
without the prior written consent of Company and Investors holding in the
aggregate at least 50% of the Shares then held by all Investors, and any
attempted assignment, delegation, sale, transfer, or other deposition, by
operation of law or otherwise, of this Agreement or of any rights or obligations
hereunder contrary to this Section 8.4 shall be void and without force or
effect. Each party shall be responsible for the compliance by its Affiliates
with the terms and conditions of this Agreement.
SECTION 8.5 Benefit. All statements, representations, warranties,
covenants and agreements in this Agreement shall be binding on the parties
hereto and shall unsure to the benefit of the respecting successors and
permitted assigns of each party hereto. Nothing in this Agreement shall be
construed to create any rights or obligations except among the parties hereto,
and no person or entity shall be regarded as a third-party beneficiary of this
Agreement.
SECTION 8.6 Governing Law. This Agreement and the rights and obligations
of the partied hereunder shall be construed in accordance with and governed by
the law of the Commonwealth of Massachusetts, without giving effect to the
conflict of law principles thereof.
SECTION 8.7 Severability. In the event that any court of competent
jurisdiction shall determine that any provision, or any portion thereof,
contained in this Agreement shall be unreasonable or unenforceable in any
respect, then such provision shall be deemed limited to the extent that such
court deems it reasonable and enforceable, and as so limited shall remain in
full force and effect. In the event that such court shall deem any such
provision, or portion thereof, wholly unenforceable, the remaining provisions of
this Agreement shall nevertheless remain in full force and effect.
SECTION 8.8 Headings and Captions. The headings and captions of the
various subdivisions of this Agreement are for convenience of reference only and
shall in on way modify, or affect the meaning or constructions of any of the
terms or provisions hereof.
SECTION 8.9 No Waiver of Rights, Powers and Remedies. No failure or delay
by a party hereto in exercising any right, power or remedy under this Agreement,
and no course of dealing between the parties hereto, shall operate as a waiver
of any such right, power or remedy of the party. No single or partial exercise
of any right, power or remedy under this Agreement by a party hereto, nor any
abandonment or discontinuance of steps to enforce any such right, power or
remedy, shall preclude such party from other or further exercise thereof or the
exercise of any other right, power or remedy hereunder. The election of any
remedy by a party hereto shall not constitute a waiver of the right of such
party to pursue other available remedies. No notice to or demand on a party not
expressly required under this Agreement shall entitle the party receiving such
notice or demand to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the party giving such
notice or demand to any other or further action in any circumstances without
such notice or demand.
SECTION 8.10 Expenses. Except as provided in Section 6.5 or Section 7.2,
each of the parties shall pay its own fees and expenses (including the fees of
any attorneys, accountants, appraisers or others
34
<PAGE>
engaged by such party) in connection with this Agreement and the transactions
contemplated hereby wither or not the transactions contemplated hereby are
consummated.
SECTION 8.11 Brokers. Each of the parties hereto represents and warrants
to the other that no broker, finder or other financial consultant has acted on
its behalf in connection with this Agreement or the transactions contemplated
hereby in such a way as to create any liability on the other. Each of the
parties hereto agrees to indemnify and save the other harmless from any claim or
demand for commission for other compensation by any other broker, finder,
financial consultant or similar agent claiming to have been employed by or on
behalf of such party and to bear the cost of legal expenses incurred in
defending against any such claim.
SECTION 8.12 Confidentiality. Each Investor acknowledges and agrees that
any information or data it has acquired from the Company, which is clearly
designated in writing as confidential and is not otherwise properly in the
public domain, was received in confidence. Each Investor agrees not to divulge,
communicate or disclose, except as may be required by law or for the performance
of this Agreement, or use to the detriment of the Company or for the benefit of
any other person or persons, or misuse in any way, any confidential information
of the Company.
SECTION 8.13 Counterparts. This Agreement may be executed in one or more
counterparts, and by different parties hereto on separate counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
SECTION 8.14 Further Assistance. In case at any time after the Closing any
further action is necessary or desirable to carry out the purposes of this
Agreement, the Company and the Investors will take such further action as the
other party may reasonably request, all at the sole cost and expense of the
requesting party (unless the requesting party is entitled to indemnification
under Article VII).
[Remainder of page intentionally left blank.]
35
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Stock Purchase
Agreement this 31st day of December, 1997.
REPLIGEN CORPORATION
By: /s/ Walter C. Herlihy
------------------------------
Name: Walter C. Herlihy
Title: Chief Executive Officer
BIOTECHNOLOGY VALUE FUND, L.P.
By: /s/ Mark N. Lampert
------------------------------
Name: Mark N. Lampert
Title: President of BVF Partners L.P.
Its General Partner
BIOTECHNOLOGY VALUE FUND, LTD.
By: /s/ Mark N. Lampert
------------------------------
Name: Mark N. Lampert
Title: Director
BIOTECHNOLOGY VENTURE PARTNERS, L.P.
By: /s/ Mark N. Lampert
------------------------------
Name: Mark N. Lampert
Title: President of BVF Partners L.P.
Its General Partner
36
<PAGE>
INVESTMENT 10, L.L.C.
By: /s/ Paul Meister
------------------------------
Name: Paul Meister
Title: Vice-President of Grosvenor Capital
Management Inc.
General Partner of Grosvenor Capital
Management, L.P.
General Partner of Grosvenor
Multi-Strategy Fund, L.P
Member of Investment 10 L.L.C.
FOUR PARTNERS
By: /s/ Thomas J. Tisch
------------------------------
Name: Thomas J. Tisch
Title: Managing Partner
37
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<NET-INCOME> (480)
<EPS-PRIMARY> (.03)
<EPS-DILUTED> (.03)
</TABLE>
