<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 25, 1997
REGISTRATION NO. 333-37439
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
AMENDMENT NO. 4
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
AASTROM BIOSCIENCES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<CAPTION>
MICHIGAN 2834 94-3096597
<S> <C> <C>
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>
---------------
24 FRANK LLOYD WRIGHT DRIVE
P.O. BOX 376
ANN ARBOR, MICHIGAN 48106
(313) 930-5555
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------
R. DOUGLAS ARMSTRONG, PH.D.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
AASTROM BIOSCIENCES, INC.
24 FRANK LLOYD WRIGHT DRIVE
P.O. BOX 376
ANN ARBOR, MICHIGAN 48106
(313) 930-5555
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
---------------
COPIES TO:
T. KNOX BELL, ESQ. RICHARD R. PLUMRIDGE, ESQ.
DOUGLAS J. REIN, ESQ. BROBECK PHLEGER & HARRISON LLP
DAVID R. YOUNG, ESQ. 1633 BROADWAY
GRAY CARY WARE & FREIDENRICH NEW YORK, NEW YORK 10019
A PROFESSIONAL CORPORATION (212) 581-1600
4365 EXECUTIVE DRIVE, SUITE 1600
SAN DIEGO, CALIFORNIA 92121
(619) 677-1400
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [X]
If this Form is to be filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, check the following
box and list the Securities Act registration statement number of earlier
effective registration statement for the same offering. [_] __________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] __________
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] __________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
---------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
EXPLANATORY NOTE
This Amendment No. 4 to this Registration Statement is being filed solely
for the purpose of filing an exhibit to the Registration Statement.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Other expenses in connection with the registration of the securities
hereunder, which will be paid by the Registrant, will be substantially as
follows:
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ITEM AMOUNT
---- --------
Securities and Exchange Commission registration fee............. $ 3,819
NASD filing fee................................................. 1,760
Nasdaq National Market fee...................................... 17,500
Blue sky qualification fees and expenses*....................... 5,000
Accounting fees and expenses*................................... 25,000
Legal fees and expenses*........................................ 100,000
Printing and engraving expenses*................................ 100,000
Transfer agent and registrar fees*.............................. 5,000
Escrow agent fees*.............................................. 10,000
Miscellaneous expenses*......................................... 81,921
--------
Total*........................................................ $350,000
========
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- --------
* Estimated expenses.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sections 1561 through 1565 of the Michigan Business Corporation Act (the
"MBCA") authorize a corporation to grant or a court to award indemnity to
directors, officers, employees and agents in terms sufficiently broad to
permit such indemnification under certain circumstances for liabilities
(including reimbursement for expenses incurred) arising under the Securities
Act of 1933, as amended (the "Securities Act").
The Bylaws of the Registrant (see Exhibit 3.2), provide that the Registrant
shall, to the fullest extent authorized or permitted by the MBCA, or other
applicable law, indemnify a director or officer who was or is a party or is
threatened to be made a party to any proceeding by or in the right of the
Registrant to procure a judgment in its favor by reason of the fact that such
person is or was a director, officer, employee or agent of the Registrant,
against expenses, including actual and reasonable attorneys' fees, and amounts
paid in settlement incurred in connection with the action or suit, if the
indemnitee acted in good faith and in a manner the person reasonably believed
to be in, or not opposed to, the best interests of the Registrant or its
shareholders. This section also authorizes the Registrant to advance expenses
incurred by any agent of the Registrant in defending any proceeding prior to
the final disposition of such proceeding upon receipt of an undertaking by or
on behalf of the agent to repay such amount unless it shall be determined
ultimately that the agent is entitled to be indemnified.
The Bylaws also authorize the Registrant to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or agent
of the Registrant against any liability asserted against or incurred by such
person in such capacity or arising out of such person's status as such,
regardless of whether the Registrant would have the power to indemnify such
person against such liability under the provisions of the MBCA.
The Registrant has entered into an indemnification agreement with certain of
its directors, officers and other key personnel, which contains provisions
that may in some respects be broader than the specific indemnification
provisions contained under applicable law. The indemnification agreement may
require the Registrant, among other things, to indemnify such directors,
officers and key personnel against certain liabilities that may arise by
reason of their status or service as directors, officers or employees of the
Registrant, to advance the expenses incurred by such parties as a result of
any threatened claims or proceedings brought against them as to which they
could be indemnified and, to the maximum extent that insurance coverage of
such directors, officers and key employees under the Registrant's directors'
and officers' liability insurance policies is maintained.
II-1
<PAGE>
Section 1209 of the MBCA permits a Michigan corporation to include in its
Articles of Incorporation a provision eliminating or limiting a director's
liability to a corporation or its shareholders for monetary damages for
breaches of fiduciary duty. The enabling statute provides, however, that
liability for breaches of the duty of loyalty, acts or omissions not in good
faith or involving intentional misconduct or knowing violation of the law, or
the receipt of improper personal benefits cannot be eliminated or limited in
this manner. The Registrant's Restated Articles of Incorporation include a
provision which eliminates, to the fullest extent permitted by the MBCA,
director liability for monetary damages for breaches of fiduciary duty.
Section 7 of the Placement Agent Agreement filed as Exhibit 1.1 hereto sets
forth certain provisions with respect to the indemnification of certain
controlling persons, directors and officers against certain losses and
liabilities, including certain liabilities under the Securities Act.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
(a) ISSUANCES OF COMMON STOCK
Since October 1, 1994, the Registrant has sold the following unregistered
shares of Common Stock:
In October 1995, the Registrant issued and sold 37,500 shares of Common
Stock to Albert B. Deisseroth at a price of $0.80 per share.
(b) ISSUANCES OF PREFERRED STOCK
Since October 1, 1994, the Registrant has sold the following unregistered
shares of preferred stock:
In April and May 1995, the Registrant issued an aggregate of 2,500,001
shares of Series D Preferred Stock to 11 accredited investors at a price of
$4.00 per share.
In December 1995, the Registrant issued 62,500 shares of Series D Preferred
Stock to Northwest Ohio Venture Fund, L.P., at a purchase price of $4.00 per
share.
In January 1996, the Registrant issued an aggregate of 1,411,765 shares of
Series E Preferred Stock to SBIC Partners, L.P., and the State Treasurer of
the State of Michigan ("Michigan") at a purchase price of $4.25 per share.
Pursuant to a Governance Agreement between the Company and Rhone-Poulenc
Rorer, Inc. ("RPR"), dated September 15, 1995, RPR terminated its contractual
relationship with the Registrant on September 6, 1996. As a result of such
termination, the Registrant issued 205,882 shares of Series E Preferred Stock
to RPR at a purchase price of $17.00 per share.
(c) ISSUANCES OF WARRANTS
Since October 1, 1994, the Registrant has issued the following unregistered
warrants:
In October 1996, the Registrant issued warrants to Michigan to purchase
69,444 shares of Common Stock as consideration for entering into the
Convertible Loan Commitment.
In October 1997, the Registrant entered into an agreement with Burrill &
Company, pursuant to which the Registrant issued warrants to purchase 200,000
shares of Common Stock as consideration for certain services to be rendered by
Burrill & Company under such agreement.
(d) OPTION ISSUANCES TO, AND EXERCISES BY, EMPLOYEES, DIRECTORS AND
CONSULTANTS
From January 18, 1990 to April 11, 1997, the Registrant issued options to
purchase a total of 2,719,231 shares of Common Stock at exercise prices
ranging from $0.15 to $7.125 per share to 99 employees and consultants and six
non-employee directors. From October 30, 1992 to April 11, 1997, the
Registrant issued a total of 1,434,534 shares of Common Stock to 31 employees
and consultants and one non-employee director upon exercise of stock options
at exercise prices ranging from $0.15 to $1.20 per share.
II-2
<PAGE>
There were no underwriters employed in connection with any of the
transactions set forth in Item 15.
The issuances described in Items 15(a), 15(b) and 15(c) were exempt from
registration under the Securities Act in reliance on Section 4(2) of the
Securities Act as transactions by an issuer not involving a public offering.
The issuances described in item 15(d) were exempt from registration under the
Securities Act in reliance on Rule 701 promulgated thereunder as transactions
pursuant to compensatory benefit plans and contracts relating to compensation.
The recipients of securities in each such transaction represented their
intention to acquire the securities for investment only and not with a view to
or for sale in connection with any distribution thereof and appropriate
legends were affixed to the share certificates or other instruments issued in
such transactions.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
See Exhibit Index.
(b) Financial Statement Schedules
All such schedules have been omitted because they are not applicable or not
required under the instructions contained in Regulation S-X or because the
information is included elsewhere in the Financial Statements or the notes
thereto.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
material change to such information in the registration statement;
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
(4) If the Registrant is a foreign private issuer, to file a post-effective
amendment to the registration statement to include any financial statements
required by Rule 3-19 of Regulation S-X at the start of any delayed offering
or throughout a continuous offering. Financial statements and information
otherwise required by Section 10(a)(3) of the Act need not be furnished,
provided that the Registrant includes in the prospectus, by means of a post-
effective amendment, financial statements required pursuant to this paragraph
and other information necessary to ensure that all other information in the
prospectus is at least as current as the date of those financial statements.
Notwithstanding the foregoing, with respect to registration statements on Form
F-3, a post-effective amendment need not be filed to include financial
statements and information required by Section 10(a)(3) of the
II-3
<PAGE>
Securities Act or Rule 3-19 of Regulation S-X if such financial statements and
information are contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the Form
F-3.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant, pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
The undersigned Registrant undertakes that:
(1) For purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 4340A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) of (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective; and
(2) For the purpose of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Ann Arbor, State of
Michigan, on the 25th day of November, 1997.
AASTROM BIOSCIENCES, INC.
By: /s/ R. Douglas Armstrong
----------------------------------
R. DOUGLAS ARMSTRONG, PH.D.
PRESIDENT AND CHIEF EXECUTIVE
OFFICER
(PRINCIPAL EXECUTIVE OFFICER)
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURES TITLE DATE
/s/ R. Douglas Armstrong President, Chief Executive November 25, 1997
- --------------------------------- Officer, and Director
R. DOUGLAS ARMSTRONG, PH.D (Principal Executive
Officer)
Todd E. Simpson* Vice President, Finance & November 25, 1997
- --------------------------------- Administration, Secretary
TODD E. SIMPSON and Treasurer, Chief
Financial Officer
(Principal Financial and
Accounting Officer)
Robert J. Kunze* Chairman of the Board and November 25, 1997
- --------------------------------- Director
ROBERT J. KUNZE
Stephen G. Emerson* Director November 25, 1997
- ---------------------------------
STEPHEN G. EMERSON, M.D., PH.D
G. Bradford Jones* Director November 25, 1997
- ---------------------------------
G. BRADFORD JONES
Horst R. Witzel* Director November 25, 1997
- ---------------------------------
HORST R. WITZEL, DR. -ING
Edward C. Wood, Jr.* Director November 25, 1997
- ---------------------------------
EDWARD C. WOOD, JR.
*By: /s/ R. Douglas Armstrong
------------------------------
R. DOUGLAS ARMSTRONG, PH.D.
ATTORNEY-IN-FACT
II-5
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in the Prospectus constituting part of this
Registration Statement on Form S-1 of our report dated August 15, 1997,
relating to the financial statements of Aastrom Biosciences, Inc., which
appears in such Prospectus. We also consent to the reference to us under the
heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Detroit, Michigan
November 18, 1997
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
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<C> <S>
1.1**** Form of Placement Agent Agreement between Cowen & Company and the
Company.
3.1* Restated Articles of Incorporation of the Company.
3.2** Bylaws, as amended.
3.3 Certificate of Designation of 5 1/2% Convertible Preferred Stock.
4.1** Specimen Common Stock Certificate.
4.2** Amended and Restated Investors' Rights Agreement, dated April 7,
1992.
4.3**** Amendment to Amended and Restated Investor's Rights Agreement, dated
April 22, 1997.
4.4**** Specimen 5 1/2% Convertible Preferred Stock Certificate.
5.1**** Opinion of Pepper, Hamilton & Scheetz.
10.1** Form of Indemnification Agreement.
10.2** Amended and Restated 1992 Incentive and Non-Qualified Stock Option
Plan and forms of agreements thereunder.
10.3** 1996 Outside Directors Stock Option Plan and forms of agreements
thereunder.
10.4** 1996 Employee Stock Purchase Plan and form of agreement thereunder.
10.5** Stock Purchase Agreement, dated October 22, 1993, between Cobe
Laboratories, Inc. and the Company and amendment thereto dated
October 29, 1996.
10.6**+ Distribution Agreement, dated October 22, 1993, between Cobe BCT,
Inc. and the Company and amendments thereto dated March 29, 1995,
September 11, 1995 and October 29, 1996.
10.7** Lease Agreement, dated May 18, 1992, between Domino's Farms Holdings,
L.P. and the Company and amendments thereto dated February 26, 1993,
October 3, 1994, November 16, 1994 and July 29, 1996.
10.8** Promissory Note, dated November 18, 1993, for $120,000 loan by the
Company to R. Douglas Armstrong, Ph.D. and amendment thereto dated
October 30, 1996.
10.9** Promissory Note, dated October 20, 1993, for $47,303 loan by the
Company to Stephen G. Emerson, M.D., Ph.D. and amendment thereto
dated October 30, 1996.
10.10** Clinical Trial Agreement dated August 28, 1996 between the Company
and Loyola University Medical Center Cancer Center.
10.11** Stock Purchase Commitment Agreement, dated October 15, 1996, between
the State Treasurer of the State of Michigan and the Company.
10.12** Convertible Loan Commitment Agreement, dated October 15, 1996,
between the State Treasurer of the State of Michigan and the Company.
10.13** Letter Agreement, dated November 11, 1996, between the Company and
Cobe Laboratories, Inc.
10.14** Termination Agreement, dated November 14, 1996, between the Company
and Rhone-Poulenc Rorer Inc.
10.15** Stock Purchase Agreement, dated November 14, 1996, between the
Company and Rhone-Poulenc Rorer Inc.
10.16** Collaborative Supply Agreement, dated December 16, 1996, between the
Company and Anchor Advanced Products, Inc. Mid-State Plastics
Division.
10.17** 1989 Stock Option Plan and form of agreement thereunder.
10.18** Ancillary Stock Option Plan and form of agreement thereunder.
10.19** 401(k) Plan.
10.20** Form of Employment Agreement.
10.21** License Agreement, dated July 17, 1992, between J.G. Cremonese and
the Company and related addenda thereto dated July 14, 1992 and July
7, 1993.
</TABLE>
II-7
<PAGE>
<TABLE>
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10.22**+ Collaborative Product Development Agreement, dated May 10, 1994,
between SeaMED Corporation and the Company.
10.23**+ Collaborative Product Development Agreement, dated November 8, 1994,
between Ethox Corporation and the Company.
10.24**+ License and Supply Agreement, dated April 1, 1996, between Immunex
Corporation and the Company.
10.25** Clinical Trial Agreement, dated April 19, 1996, between the Company
and the University of Texas M.D. Anderson Cancer Center.
10.26** License Agreement, dated March 13, 1992, between the Company and the
University of Michigan and amendments thereto dated March 13, 1992,
October 8, 1993 and June 21, 1995.
10.27** Employee Proprietary Information and Invention Agreement, effective
June 1, 1991, between the Company and R. Douglas Armstrong, Ph.D.
10.28** Employment Agreement, dated June 19, 1992, between the Company and
James Maluta.
10.29** Employment Agreement, dated December 8, 1995, between the Company
and Todd E. Simpson.
10.30** Employment Agreement, dated February 10, 1994, between the Company
and Walter C. Ogier.
10.31** Employment Agreement, dated April 19, 1994, between the Company and
Thomas E. Muller, Ph.D.
10.32** Employment Agreement, dated October 26, 1995, between the Company
and Alan K. Smith, Ph.D.
10.33** Consulting Agreement, dated June 1, 1995, between the Company and
Stephen G. Emerson, M.D., Ph.D.
10.34** Form of Subscription Agreement for the purchase of Series D
Preferred Stock (Enterprise Development Fund L.P., Enterprise
Development Fund II, L.P. and Northwest Ohio Venture Fund Limited
Partnership).
10.35** Stock Purchase Agreement, dated January 8, 1996, among the Company,
SBIC Partners, L.P. and the State Treasurer of the State of
Michigan.
10.36** Form of Subscription Agreement for the purchase of Series D
Preferred Stock (Brentwood Associates V, L.P., Candice E. Appleton
Family Trust, Candis J. Stern, Helmut F. Stern, H&Q Life Science
Technology Fund, H&Q London Ventures, State Treasurer of the State
of Michigan and Windpoint Partners II, Limited Partnership).
10.37** Subscription Agreement, dated December 11, 1995, between the Company
and Northwest Ohio Venture Fund Limited Partnership.
10.38# Second Amendment to Promissory Note payable to the Company by
Stephen G. Emerson, M.D., Ph.D., dated June 30, 1997.
10.39# Second Amendment to Promissory Note payable to the Company by R.
Douglas Armstrong, Ph.D., dated June 30, 1997.
10.40# Amendment to License and Supply Agreement, dated August 25, 1997,
between Immunex Corporation and the Company.
10.41**** Strategic Planning Consulting Services and Collaboration Agreement,
dated October 7, 1997, between Burrill & Company, LLC and the
Company.
10.42**** Amendment to Stock Purchase Agreement among the Company, SBIC
Partners, L.P. and the State Treasurer of the State of Michigan,
dated April 23, 1997.
10.43**** Form of Preferred Stock Purchase Agreement to be entered into among
the Company and the purchasers of the 5 1/2% Convertible Preferred
Stock of the Company.
10.44**** Employment Agreement, dated October 24, 1997, between the Company
and Bruce W. Husel.
11.1# Statement regarding computation of net loss per share.
16.1*** Letter from Coopers & Lybrand L.L.P., dated July 15, 1997.
23.1 Consent of Price Waterhouse LLP (see page II-6).
23.2**** Consent of Pepper, Hamilton & Scheetz (included in Exhibit 5.1).
23.3**** Consent of Oblon, Spivak, McClelland, Maier & Neustadt, P.C.
</TABLE>
II-8
<PAGE>
<TABLE>
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24.1**** Power of Attorney.
27.1# Financial Data Schedule.
27.2% Financial Data Schedule.
</TABLE>
- --------
* Incorporated by reference to the Company's Quarterly Report on Form 10-Q
for the quarter ended December 31, 1996, as filed on March 7, 1997.
** Incorporated by reference to the Company's Registration Statement on Form
S-1 (No. 333-15415), declared effective on February 3, 1997.
*** Incorporated by reference to the Company's Current Report on Form 8-K, as
filed on July 16, 1997.
****Previously filed as an exhibit to this Registration Statement.
# Incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended June 30, 1997, as filed on September 25, 1997.
% Incorporated by reference to the Company's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1997, as filed on November 14, 1997.
+ Confidential treatment has been granted as to a portion of this exhibit.
II-9
<PAGE>
Exhibit 3.3
-----------
--------------------
AASTROM BIOSCIENCES, INC.
CERTIFICATE OF DESIGNATION
Pursuant to Section 302 of the
Michigan Business Corporation Act
--------------------
5 1/2% CONVERTIBLE PREFERRED STOCK
Aastrom Biosciences, Inc., a Michigan corporation (the "Corporation"),
hereby certifies that the following resolution has been duly adopted by the
Board of Directors of the Corporation:
RESOLVED, that pursuant to the authority expressly granted to and vested in
the Board of Directors of the Corporation (the "Board") by the provisions of the
Restated Articles of Incorporation of the Corporation (the "Articles of
Incorporation"), there hereby is created, out of the 5,000,000 shares of
preferred stock of the Corporation authorized in Article III of the Articles of
Incorporation (the "Preferred Stock"), a series of the Preferred Stock
consisting of 2,400,000 shares, which series shall have the following powers,
designations, preferences and relative, participating, optional and other
rights, and the following qualifications, limitations and restrictions:
1. Designation and Amount. This series of Preferred Stock shall be
----------------------
designated the 5 1/2% Convertible Preferred Stock, and the authorized number of
shares constituting such series shall be 2,400,000. The 5 1/2% Convertible
Preferred Stock shall have no par value.
2. Dividend Rights of 5 1/2% Convertible Preferred Stock. Subject to the
-----------------------------------------------------
dividend provisions fixed by the Board for any series of Preferred Stock
designated by the Board in the future (which series shall not receive any
dividends in preference to the 5 1/2% Convertible Preferred Stock but may
receive dividends on a pari passu basis with the 5 1/2% Convertible Preferred
Stock), the holders of 5 1/2% Convertible Preferred Stock shall be entitled to
receive dividends, out of any assets at the time legally available therefor, at
the rate equal to five and one-half percent (5.5%) of the price at which the
shares of 5 1/2% Convertible Preferred Stock are first sold by the Corporation
to the public (the "Issue Price") per annum. The right to dividends on the 5
1/2% Convertible Preferred Stock shall be cumulative and shall accrue commencing
on the date of issuance, on a quarterly basis on the last day of March, June,
September and December of each year (the "Accrual Dates"). Accrued but unpaid
dividends shall not bear interest. In lieu of the payment of a cash dividend,
the Board may elect to pay all or any portion of the dividend in the form of
shares of common stock of the Corporation ("Common Stock") with a value
equivalent to the cash dividend that would have been paid (such value to be
based on the closing sale price of the Common Stock on the Accrual Date or, if
the Common Stock is not traded in a public market at such time, on the good
faith determination of such value by the Board), and the Board shall
<PAGE>
make such election within thirty (30) days of each Accrual Date. No dividends
shall be paid on any Common Stock unless there are no accrued and unpaid
dividends on the 5 1/2% Convertible Preferred Stock and at the same time a
dividend is paid with respect to all outstanding shares of 5 1/2% Convertible
Preferred Stock in an amount for each such share of 5 1/2% Convertible Preferred
Stock equal to the aggregate amount of such dividends payable on that number of
shares of Common Stock into which each such share of 5 1/2% Convertible
Preferred Stock could then be converted. Accrued but unpaid dividends shall be
due and payable, to the holders of record of shares of 5 1/2% Convertible
Preferred Stock on the Accrual Date, on the date thirty-five (35) days
following each Accrual Date (the "Regular Dividend Payment Date"); provided,
--------
however, that in the event of any automatic conversion of shares of 5 1/2%
- -------
Convertible Preferred Stock into Common Stock pursuant to Section 5(c), all
accrued but unpaid dividends shall be due and payable immediately prior to such
conversion (along with each Regular Dividend Payment Date, the "Dividend Payment
Dates"). The person or persons entitled to receive any shares of Common Stock in
payment of such dividends shall be treated for all purposes as the record holder
or holders of such shares on the Dividend Payment Date. In the event that the
Board shall elect to pay all or any portion of any dividend in shares of Common
Stock, such shares shall be subject to appropriate adjustment in the event of
any stock split, stock dividend, recapitalization or similar event occurring
between the Accrual Date and the Dividend Payment Date, and, in the event that
the record date for any dividend or distribution on the Common Stock shall occur
between the Accrual Date and the Dividend Payment Date, such dividend or
distribution shall be payable on such shares on the Dividend Payment Date.
3. Preference on Liquidation. Subject to the liquidation preferences of
-------------------------
any series of Preferred Stock designated by the Board in the future (which
series shall not receive any payment upon any liquidation, dissolution or
winding up of the Corporation in preference to the 5 1/2% Convertible Preferred
Stock but may be entitled to receive such a payment on a pari passu basis with
the 5 1/2% Convertible Preferred Stock), in the event of any liquidation,
dissolution or winding up of the Corporation, distributions to holders of 5 1/2%
Convertible Preferred Stock and holders of Common Stock shall be made in the
following manner:
(a) Amount, Priority, Etc.
---------------------
(i) The holders of 5 1/2% Convertible Preferred Stock shall be
entitled to receive on account of each share of 5 1/2% Convertible Preferred
Stock then held by them, prior and in preference to any distribution of any of
the assets of the Corporation to the holders of the Common Stock by reason of
their ownership of such stock, the sum of: (A) the Issue Price, adjusted for any
stock split, stock combination, stock distribution or stock dividend with
respect to such shares; plus (B) the amount of any dividends accruing through
the date of distribution, whether or not earned or declared. If the assets and
funds available for distribution among the holders of 5 1/2% Convertible
Preferred Stock and among the holders of any series of Preferred Stock ranking
on a parity with the 5 1/2% Convertible Preferred Stock with respect to this
subsection (a)(i) of this Section 3 as to the distribution of assets and funds
upon such dissolution, liquidation or winding up shall be insufficient to permit
the payment to such holders of their full liquidation payments, then the entire
assets and funds of the Corporation legally available for such distribution
shall be distributed ratably among such holders in proportion to their aggregate
preferential amounts.
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(ii) After payment in full to the holders of 5 1/2% Convertible
Preferred Stock of all amounts exclusively payable on or with respect to said
shares pursuant to subsection (a)(i) of this Section 3, the holders of the
Common Stock shall be entitled to receive the entire remaining assets and funds
of the Corporation legally available for such distribution, with such amounts to
be distributed ratably among such holders in proportion to their respective
holdings of shares of Common Stock.
(b) Distributions Other Than Cash. In the event the Corporation shall
-----------------------------
propose to take any action of the types described in Section 3(a) which will
involve the distribution of assets other than cash, the Board shall make a good
faith determination of the value of the assets to be distributed to the holders
of shares of 5 1/2% Convertible Preferred Stock. The Corporation shall give
prompt written notice to each holder of shares of 5 1/2% Convertible Preferred
Stock of such valuation, which notice shall be provided no later than the notice
provided in Section 5(l). All notices pursuant to this Section 3 hereof shall be
deemed given upon personal delivery or upon deposit in a United States Post
Office by registered or certified mail.
4. Voting. Except as otherwise required by law, the shares of 5 1/2%
------
Convertible Preferred Stock shall be voted together with the Common Stock at any
annual or special meeting of the stockholders of the Corporation, or may act by
written consent in the same manner as the Common Stock, and shall have the
voting rights and powers equal to the voting rights of the Common Stock, upon
the following basis: each holder of shares of 5 1/2% Convertible Preferred
Stock shall be entitled to such number of votes for the shares of 5 1/2%
Convertible Preferred Stock held by him on the record date for such meeting or
action to be taken by written consent, as shall be equal to the nearest whole
number of shares of Common Stock into which such holder's shares of 5 1/2%
Convertible Preferred Stock are convertible immediately after the close of
business on the record date for such meeting or action to be taken by written
consent, as the case may be.
5. Conversion Rights. The holders of 5 1/2% Convertible Preferred Stock
-----------------
shall have conversion rights as follows:
(a) Voluntary Conversion. Each share of 5 1/2% Convertible
--------------------
Preferred Stock shall be convertible, at the option of the holder thereof, at
any time at the principal office of the Corporation or any transfer agent for
such shares, into fully paid and nonassessable shares of Common Stock. The
number of shares of Common Stock into which each share of 5 1/2% Convertible
Preferred Stock shall be converted is equal to the Issue Price divided by the
Conversion Price. The initial Conversion Price for the 5 1/2% Convertible
Preferred Stock shall be equal to the Issue Price, subject to adjustment as
provided in Section 5(g).
(b) Mandatory Conversion Upon Stock Value Benchmark. Each share
-----------------------------------------------
of 5 1/2% Convertible Preferred Stock shall be automatically converted into
shares of Common Stock at the then effective Conversion Price in the event that,
at any time following the second anniversary of the date upon which the first
share of 5 1/2% Convertible Preferred Stock has been issued, the closing bid
price of the Common Stock exceeds a price per share of double the Issue Price
for twenty (20) consecutive trading days.
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<PAGE>
(c) Mandatory Conversion Upon Merger. Each share of 5 1/2%
--------------------------------
Convertible Preferred Stock shall be automatically converted into shares of
Common Stock at the then effective Conversion Price immediately prior to the
time at which shareholders of record for participation in the merger shall be
determined in any merger transaction (i) to which the Corporation is a party,
(ii) in which the consideration received by the Corporation or its shareholders
equals or exceeds a value of double the Issue Price per share of Common Stock
outstanding as of the date upon which a definitive agreement relating to such
transaction is executed by the parties thereto (the "Execution Date") (with all
shares of capital stock of the Corporation that are convertible into Common
Stock considered on an as-converted basis), and (iii) in which either the
Corporation is not the surviving entity or in which the holders of the
Corporation's voting securities prior to the transaction own less than fifty
percent (50%) of the voting securities of the combined entity immediately
following the merger. The consideration referred to in the preceding clause (ii)
shall be valued as of the Execution Date, and, in the event that such
consideration is other than (A) cash, or (B) publicly traded securities of an
entity having an aggregate market capitalization of at least $160,000,000 and
average daily trading volume in its securities of at least 50,000 shares over
the twenty (20) trading days preceding the Execution Date (in which case such
securities shall be valued in accordance with the closing trading price on the
last trading day preceding the Execution Date), such consideration shall be
valued by an investment banking firm or other reputable firm or institution
selected by the holders of a majority of the outstanding shares of 5 1/2%
Convertible Preferred Stock and reasonably acceptable to the Company.
(d) Mandatory Conversion Upon Partial Conversion. Each share of 5
--------------------------------------------
1/2% Convertible Preferred Stock shall be automatically converted into shares of
Common Stock at the then effective Conversion Price in the event that, at any
time following the date of the initial issuance of shares of 5 1/2% Convertible
Preferred Stock (the "Initial Issuance Date"), less than 500,000 shares of 5
1/2% Convertible Preferred Stock remain outstanding (as adjusted for stock
splits, stock dividends, recapitalizations and the like).
(e) Effect of Conversion on Accrued Dividends. Upon any
-----------------------------------------
conversion as described in this Section 5, each holder of the 5 1/2% Convertible
Preferred Stock shall remain entitled to receive all accrued and unpaid
dividends earned through the date of conversion.
(f) Conversion Procedure. The holder of any shares of 5 1/2%
--------------------
Convertible Preferred Stock may exercise the conversion right specified in
Section 5(a) by surrendering to the Corporation or any transfer agent of the
Corporation the certificate or certificates for the shares to be converted,
accompanied by written notice specifying the number of shares to be converted.
Upon the occurrence of any event specified in Section 5(b), Section 5(c) or
Section 5(d), the outstanding shares of 5 1/2% Convertible Preferred Stock shall
be converted automatically without any further action by the holders of such
shares and whether or not the certificates representing such shares are
surrendered to the Corporation or its transfer agent; provided, however, that
-------- -------
the Corporation shall not be obligated to issue to any holder certificates
evidencing the shares of Common Stock issuable upon such conversion unless
certificates evidencing such shares of 5 1/2% Convertible Preferred Stock are
delivered either to the Corporation or any transfer agent of the Corporation.
Conversion shall be deemed to have been effected on the date when delivery of
notice of an election to convert and of certificates for shares being converted
is made or on the
4
<PAGE>
date of the occurrence of any event of conversion specified in Section 5(b),
Section 5(c) or Section 5(d), as the case may be, and such date is referred to
herein as the "Conversion Date." As promptly as practicable thereafter (and
after surrender of the certificate or certificates representing shares of 5 1/2%
Convertible Preferred Stock to the Corporation or any transfer agent of the
Corporation), the Corporation shall issue and deliver to such holder a
certificate or certificates for the number of full shares of Common Stock to
which such holder is entitled. No fractional shares of Common Stock shall be
issued by the Corporation and all such fractional shares shall be disregarded.
In lieu thereof, the Corporation shall pay in cash the fair market value of any
such fractional share as determined by the Board. The person in whose name the
certificate or certificates for Common Stock are to be issued shall be deemed to
have become a holder of record of such Common Stock on the applicable Conversion
Date. Upon conversion of only a portion of the number of shares covered by a
certificate representing shares of 5 1/2% Convertible Preferred Stock
surrendered for conversion (in the case of conversion pursuant to Section 5(a)),
the Corporation shall issue and deliver to or upon the written order of the
holder of the certificate so surrendered for conversion, at the expense of the
Corporation, a new certificate covering the number of shares of 5 1/2%
Convertible Preferred Stock representing the unconverted portion of the
certificate so surrendered.
(g) Adjustments to Conversion Price. The Conversion Price for the
-------------------------------
5 1/2% Convertible Preferred Stock shall be subject to adjustment from time to
time as follows:
(i) Adjustment for Stock Splits, Recapitalizations, Etc. In
---------------------------------------------------
case the Corporation shall at any time (i) subdivide the outstanding Common
Stock, or (ii) issue a stock dividend on its outstanding Common Stock, the
Conversion Price in effect immediately prior to such subdivision or the issuance
of such stock dividend shall be proportionately decreased. In case the
Corporation shall at any time combine its outstanding Common Stock, the
Conversion Price in effect immediately prior to such combination shall be
proportionately increased. All such adjustments described herein shall be
effective at the close of business on the date of such subdivision, stock
dividend or combination, as the case may be.
(ii) Adjustment Upon Other Reclassifications. In case of any
---------------------------------------
reclassification of the Common Stock other than a recapitalization described in
Section 5(g)(i), the then effective Conversion Price shall be adjusted so that
each share of the 5 1/2% Convertible Preferred Stock shall thereafter be
convertible into that number of shares of stock or other securities or property
to which a holder of the number of shares of Common Stock issuable upon
conversion of a share of 5 1/2% Convertible Preferred Stock immediately prior to
such reclassification would have been entitled upon such reclassification. In
any such case, appropriate adjustment (as determined by the Board) shall be made
in the application of the provisions herein set forth with respect to the rights
and interests thereafter of the holders of 5 1/2% Convertible Preferred Stock,
such that the provisions set forth herein shall thereafter be applicable, as
nearly as reasonably may be, in relation to any share of stock or other property
thereafter issuable upon conversion.
(iii) Adjustment Upon Issuance of Equity Securities. Upon the
---------------------------------------------
issuance by the Corporation of Equity Securities (as defined in Section
5(g)(iii)(B)(1) below) at a consideration per share less than the Conversion
Price in effect immediately prior to the time of
5
<PAGE>
such issue or sale other than an issuance of stock or securities pursuant to
Section 5(g)(i) or Section 5(g)(ii) above or the issuance of shares of Common
Stock upon conversion of any shares of 5 1/2% Convertible Preferred Stock, then
forthwith upon such issue or sale, such Conversion Price shall be reduced to a
price (calculated to the nearest hundredth of a cent) determined by multiplying
such Conversion Price by a fraction:
(A) the numerator of which shall be equal to the sum of
(x) the number of shares of Common Stock outstanding immediately prior to such
issue or sale (other than shares issued subsequent to the Original Issuance Date
that were not issued upon conversion, exercise or exchange of securities or
obligations outstanding prior to the Original Issuance Date that are excluded
from the definition of "Equity Securities" below in Section 5(g)(iii)(B)(1) by
clause (a), (b), (c), or (d) of such section) multiplied by the Conversion Price
in effect immediately prior to such adjustment, (y) the number of shares of
Common Stock issuable upon conversion or exchange of any obligations or of any
securities of the Corporation outstanding immediately prior to such adjustment
(other than securities or obligations issued subsequent to the Original Issuance
Date that were not issued upon conversion, exercise or exchange of securities or
obligations outstanding prior to the Original Issuance Date that are excluded
from the definition of "Equity Securities" below in Section 5(g)(iii)(B)(1) by
clause (a), (b), (c) or (d) of such section) multiplied by the Conversion Price
in effect immediately prior to such adjustment, and (z) an amount equal to the
aggregate "consideration actually received" by the Corporation upon such issue
or sale; and
(B) the denominator of which shall be equal to the
product of the Conversion Price in effect immediately prior to such adjustment
multiplied by the sum of (x) the number of shares of Common Stock outstanding
immediately after such issue or sale (other than shares issued subsequent to the
Original Issuance Date (unless issued upon conversion, exercise or exchange of
securities or obligations outstanding prior to the Original Issuance Date) that
are excluded from the definition of "Equity Securities" below in Section
5(g)(iii)(B)(1) by clause (a), (b), (c), or (d) of such section), and (y) the
number of shares of Common Stock issuable upon conversion or exchange of any
obligations or of any securities of the Corporation outstanding immediately
after such issue or sale (other than securities or obligations issued subsequent
to the Original Issuance Date that were not issued upon conversion, exercise or
exchange of securities or obligations outstanding prior to the Original Issuance
Date that are excluded from the definition of "Equity Securities" below in
Section 5(g)(iii)(B)(1) by clause (a), (b), (c) or (d) of such section).
For purposes of this Section 5(g)(iii), the following provisions shall be
applicable:
(1) The term "Equity Securities" as used in this
Section 5(g)(iii) shall mean any shares of Common Stock, or any obligation, or
any share of stock or other security of the Corporation convertible into or
exchangeable for Common Stock, except for (a) shares of Common Stock or options
to purchase Common Stock issued or granted to officers, directors, employees or
consultants of the Corporation and its subsidiaries pursuant to any stock option
plan or employee stock purchase plan approved by the Board, (b) securities
issued pursuant to an acquisition of another corporation or entity by the
Corporation through a merger or otherwise, provided that the shareholders of the
Corporation immediately prior to the transaction hold more than fifty percent
(50%) of the voting power of the surviving or continuing
6
<PAGE>
entity, (c) securities issued pursuant to contractual obligations of the
Corporation existing prior to the initial issuance of shares of 5 1/2%
Convertible Preferred Stock (as generally described in the Corporation's
registration statement on Form S-1 (File No. 333-37439), as filed with the
Securities and Exchange Commission on October 8, 1997), or (d) securities issued
in any transaction approved by the Board if, in connection with or related to
such transaction, the purchaser or recipient of such securities, or an affiliate
of such purchaser or recipient, enters into or agrees to enter into (or has
previously entered into) a material business relationship with the Corporation,
including, but not limited to, a relationship relating to licensing, clinical
development, product development, marketing or distribution.
(2) In case of an issue or sale for cash of
shares of Common Stock, the "consideration actually received" by the Corporation
therefor shall be deemed to be the amount of cash received, before deducting
therefrom any commissions or expenses paid by the Corporation.
(3) In case of the issuance (otherwise than
upon conversion or exchange of obligations or shares of stock of the
Corporation) of additional shares of Common Stock for a consideration other than
cash or a consideration partly other than cash, the amount of consideration
other than cash received by the Corporation for such shares shall be deemed to
be the value of such consideration, as determined in good faith by the Board.
(4) In case of the issuance by the Corporation
in any manner of any rights to subscribe for or to purchase shares of Common
Stock, or any options for the purchase of shares of Common Stock or stock
convertible into Common Stock, all shares of Common Stock or stock convertible
into Common Stock to which the holders of such rights or options shall be
entitled to subscribe for or purchase pursuant to such rights or options shall
be deemed "outstanding" as of the date of the offering of such rights or the
granting of such options, as the case may be, and the minimum aggregate
consideration named in such rights or options for the shares of Common Stock or
stock convertible into Common Stock covered thereby, plus the consideration, if
any, received by the Corporation for such rights or options, shall be deemed to
be the "consideration actually received" by the Corporation (as of the date of
the offering of such rights or the granting of such options, as the case may be)
for the issuance of such shares.
(5) In case of the issuance or issuances by the
Corporation in any manner of any obligations or of any shares of stock of the
Corporation that shall be convertible into or exchangeable for Common Stock, all
shares of Common Stock issuable upon the conversion or exchange of such
obligations or shares shall be deemed issued as of the date such obligations or
shares are issued, and the amount of the "consideration actually received" by
the Corporation for such additional shares of Common Stock shall be deemed to be
the sum of (x) the amount of consideration received by the Corporation upon the
issuance of such obligations or shares, and (y) the minimum aggregate
consideration, if any, other than such obligations or shares, receivable by the
Corporation upon such conversion or exchange, except in adjustment of dividends.
(6) The amount of the "consideration actually
received" by the Corporation upon issuance of any rights or options referred to
in subsection (4) above or
7
<PAGE>
upon the issuance of any obligations or shares which are convertible or
exchangeable as described in subsection (5) above, and the amount of the
consideration, if any, other than such obligations or shares so convertible or
exchangeable, receivable by the Corporation upon the exercise, conversion or
exchange thereof shall be determined in the same manner provided in subsections
(2) and (3) above with respect to the consideration received by the Corporation
in case of the issuance of additional shares of Common Stock; provided, however,
-------- -------
that if such obligations or shares of stock so convertible or exchangeable are
issued in payment or satisfaction of any dividend upon any stock of the
Corporation other than Common Stock, the amount of the "consideration actually
received" by the Corporation upon the original issuance of such obligations or
shares of stock so convertible or exchangeable shall be deemed to be the value
of such obligations or shares of stock as of the date of the adoption of the
resolution declaring such dividend, as determined by the Board at or as of that
date.
(7) In the event the Corporation shall declare
a distribution payable in securities of other persons, evidences of indebtedness
issued by the Corporation or other persons or options or rights not referred to
in this Section 5(g)(iii), then, in each such case, the holders of the 5 1/2%
Convertible Preferred Stock shall be entitled to the distributions provided for
in Section 3 above, and no adjustment to the Conversion Price provided for in
this Section 5(g)(iii) shall be applicable.
(h) Reservation of Common Stock. The Corporation shall at all
---------------------------
times reserve and keep available, out of its authorized but unissued Common
Stock, solely for the purpose of effecting the conversion of 5 1/2% Convertible
Preferred Stock, the full number of shares of Common Stock deliverable upon the
conversion of all 5 1/2% Convertible Preferred Stock from time to time
outstanding. The Corporation shall from time to time (subject to obtaining
necessary director and shareholder approval), in accordance with the laws of the
State of Michigan, increase the authorized amount of its Common Stock if at any
time the authorized number of shares of Common Stock remaining unissued shall
not be sufficient to permit the conversion of all of the shares of 5 1/2%
Convertible Preferred Stock at the time outstanding.
(i) Cancellation of Shares. Upon any conversion of 5 1/2%
----------------------
Convertible Preferred Stock pursuant to this Section 5, the shares of 5 1/2%
Convertible Preferred Stock which are converted shall not be reissued. Upon
conversion of all of the then outstanding 5 1/2% Convertible Preferred Stock
pursuant to this Section 5 and upon the taking of any action required by law,
all matters set forth in this Certificate of Designation shall be eliminated
from the Articles of Incorporation, shares of 5 1/2% Convertible Preferred Stock
shall not be deemed outstanding for any purpose whatsoever, and all such shares
shall revert to the status of authorized and unissued shares of Preferred Stock.
(j) No Impairment. The Corporation, whether by amendment of its
-------------
Articles of Incorporation or through any reorganization, transfer of assets,
merger, dissolution, issue or sale of securities or any other voluntary action,
will not avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Corporation, but at all times
in good faith will assist in the carrying out of all of such action as may be
necessary or appropriate in order to protect the conversion rights pursuant to
this Section 5 of the holders of the 5 1/2% Convertible Preferred Stock against
impairment.
8
<PAGE>
(k) Certificate as to Adjustments. Upon the occurrence of each
-----------------------------
adjustment or readjustment of the Conversion Price pursuant to this Section 5,
the Corporation at its expense promptly will compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of shares of 5 1/2% Convertible Preferred Stock, a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon which
such adjustment or readjustment is based. The Corporation, upon the written
request at any time of any holder of 5 1/2% Convertible Preferred Stock, will
furnish or cause to be furnished to such holder a like certificate setting forth
(i) such adjustments and readjustments, (ii) the Conversion Price at the time in
effect, and (iii) the number of shares of Common Stock and the amount, if any,
of other property which at the time would be received upon the conversion of the
5 1/2% Convertible Preferred Stock held by such holder.
(l) Notices of Record Date. In the event of any taking by the
----------------------
Corporation of a record of the holders of any class of securities as of a
certain date for the purpose of determining the holders thereof who are entitled
to receive any dividend (other than a regular cash dividend) or other
distribution, any Equity Securities 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, the Corporation will mail to each
holder of 5 1/2% Convertible Preferred Stock a notice specifying the date on
which any such record is to be taken for the purpose of such dividend,
distribution or right, and the amount and character of such dividend,
distribution or right. Such notice shall be given at least twenty (20) days
prior to the date specified therein for the taking of such record.
(m) Notices. Any notices required by the provisions of this
-------
Section 5 to be given to the holders of shares of 5 1/2% Convertible Preferred
Stock must be in writing and will be deemed given upon personal delivery, one
day after deposit with a reputable overnight courier service for overnight
delivery or after transmission by facsimile telecopier with confirmation of
successful transmission, or five days after deposit in the U.S. mail, by
registered or certified mail postage prepaid, or upon actual receipt if given by
any other method, addressed to each holder of record at his address appearing on
the books of the Corporation.
9
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation to be signed by its President, and attested by its Secretary, this
25th day of November, 1997.
AASTROM BIOSCIENCES, INC.
By: /s/ R. Douglas Armstrong
---------------------------------
R. Douglas Armstrong, President
Attest:
By: /s/ Todd E. Simpson
----------------------------
Todd E. Simpson, Secretary
