Exhibit 10.12
*** Text Omitted and Filed
Separately
Confidential Treatment Requested
Under 17 C.F.R. §§
200.80(b)(4)
and 230.406
CONTRIBUTION
AGREEMENT
This Contribution Agreement (this
“ Agreement ”) is entered into as of August
31st, 2000 (the “ Effective Date ”) by and
between CryoCor, Inc., a Delaware corporation (the Company”),
and Cryogen, Inc., a California corporation (“ Cryogen
”).
BACKGROUND
A. Cryogen desires to provide for the initial
capitalization of the Company.
B. In accordance with the terms and conditions of
this Agreement, Cryogen desires to contribute to the Company
certain assets and intellectual property rights for the development
of products (“ Company Products ”) for use in
performing cardiac or vascular ablation for the treatment of
cardiac arrhythmias in consideration of the issuance by the Company
to Cryogen of a specified number of shares of the Company’s
Series A Convertible Preferred Stock (the “ Series A
Preferred Stock ”) and the Company’s Common Stock
(the “ Common Stock ”).
C. Following the Closing (as hereinafter defined)
of the transactions contemplated hereby, Cryogen desires and
intends to distribute (the “ Distribution ”) the
Company Common Shares (as hereinafter defined) and the Company
Series A Shares (as hereinafter defined) to its holders of equity
securities, including option holders and warrant holders (if an
when exercised), in proportion to their ownership of the common
stock and preferred stock of Cryogen, as the case may be, on an
as-converted basis.
D. Simultaneously with the Closing of the
transactions contemplated hereby, the Company desires to issue
shares of Series B Preferred Stock as set forth in that certain
term sheet (the “ Term Sheet ”), dated June 16,
2000 between Cryogen and MPM Capital (the “ Series B
Financing ”).
AGREEMENT
Now, therefore, in consideration of
the foregoing recitals, the mutual promises set forth in this
Agreement, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties to
this Agreement agree as follows:
1. AGREEMENT TO ISSUE STOCK AND
GRANT RIGHTS.
1.1 Agreement to Issue
Stock.
(a) Authorization.
On the date of the Closing, the
Company shall have authorized the issuance, pursuant to the terms
and conditions of this Agreement, of a total of 1,604,166 shares of
Common Stock and a total of 5,645,834 shares of Series A Preferred
Stock. The Common Stock and the Series A Preferred Stock shall have
the rights, preferences, privileges and restrictions as set forth
in the Amended and Restated Certificate of Incorporation of the
Company in the form of Exhibit A hereto (the “
Restated Certificate ”).
1.
(b) Shares.
Subject to the terms and conditions
of this Agreement, on the date of the Closing, the Company shall
issue to Cryogen, and Cryogen agrees to accept from the Company,
(A) 1,604,166 shares of Common Stock (the “ Company Common
Shares ”) and (B) 5,645,834 shares of Series A Preferred
Stock (the “ Company Series A Shares ;” and
together with the Company Common Shares, the “ Shares
”).
1.2 Agreement to Contribute
Assets and Grant Rights, Etc.
(a) Assets and Other Items to be
Contributed and Rights to be Granted by Cryogen.
Subject to the terms and conditions
of this Agreement, on the date of the Closing, Cryogen
shall:
(i) sell, assign, transfer, convey and deliver to
the Company all of Cryogen’s right, title and interest in and
to the assets, rights and properties set forth on Exhibit B
hereto (the “ Contributed Assets ”) and the
clinical development products set forth on Exhibit E hereto
(the “ Contributed Clinical Development Products
”), free and clear of all liens, encumbrances and security
interests;
(ii) grant a license to the Company (the “
License ”) for certain intellectual property rights of
Cryogen with respect to the development of the Company Products
(the “ Licensed Technology ”) as set forth in
the License Agreement attached hereto as Exhibit C (the
“ License Agreement ”);
(iii) enter into a Research and Development Agreement
with the Company substantially in the form attached hereto as
Exhibit D (the “ Development Agreement ;”
the License Agreement and the Development Agreement are
collectively referred to herein as the “ Related
Agreements ”);
(iv) sell, assign, transfer, convey and deliver to
the Company, and the Company shall assume from Cryogen, all of
Cryogen’s right, title and interest in and to and all
obligations under the agreements and contracts for the production
of certain molds listed on Exhibit F hereto (the “
Purchased Molds Contracts ”) and the right to delivery
of the molds produced thereunder, free and clear of all liens,
encumbrances and security interests; and
(v) sell, assign, transfer, convey and deliver to
the Company all of Cryogen’s right, title and interest in and
to the raw materials to be used to develop and manufacture the
Company Products (the “ Development Raw Materials
”), free and clear of all liens, encumbrances and security
interests.
2. CLOSING;
DELIVERY.
2.1 Closing.
(a) Closing.
The closing of the transactions
contemplated hereby shall be held at the offices of Brobeck,
Phleger & Harrison LLP, 12390 El Camino Real, San Diego, CA
92130 at 11:00 a.m. on August 24, 2000, or at such other time and
place as the Company and Cryogen may mutually agree upon (the
“ Closing ”).
2.
(b) Deliveries.
At the Closing, the Company shall
deliver to Cryogen certificates representing the Shares to be
issued to Cryogen at the Closing against delivery of a counterpart
executed by Cryogen of each of the License Agreement, the
Development Agreement and such assignments, bills of sale and other
instruments as shall be necessary to evidence the assignment,
transfer, conveyance and delivery to the Company of the Contributed
Assets, the Contributed Clinical Development Products, the
Purchased Molds Contracts and the Development Raw Materials and the
assumption by the Company of the CryoCor Employee Liabilities (as
defined below), the Raw Materials Liability (as defined below), and
the liabilities and obligations under the Purchased Mold Contracts
(the “ Assignment and Assumption Documents ”).
In addition, within seven (7) days following the Closing, the
Company shall (i) pay the sum of $[…***…] in cash to
Cryogen as reimbursement for amounts actually heretofore paid by
Cryogen to the vendors of the Purchased Molds Contracts under the
terms of the Purchased Molds Contracts; (ii) pay to Cryogen the
purchase price for the Development Raw Materials (estimated as of
the date hereof to be approximately $[…***…]) (the
“ Raw Materials Liability ”), which such
purchase price shall be invoiced by Cryogen to the Company promptly
after the Closing; and (iii) reimburse Cryogen for the fees, costs
and expenses charged by Trinet Employer Group, Inc. (“
Trinet ”) and actually paid or payable by Cryogen with
respect to each of the CryoCor Employees (as such term is defined
in Section 6.3(a) hereof), including, costs and expenses for
payroll, payroll taxes, administrative fees, overtime and benefits
charged by Trinet, for the period beginning 12:00 p.m. California
time on August 4, 2000 through the date of the Closing (the “
CryoCor Employee Liabilities ”), which such fees,
costs and expenses will be invoiced by Cryogen to the Company
promptly after the Closing. Notwithstanding the foregoing, for
purposes of this Section 2.1(b) , “CryoCor
Employees” shall not be deemed to include any CryoCor
Employee who elects not to become an employee of the
Company.
3. COMPANY REPRESENTATIONS AND
WARRANTIES. The Company
hereby represents and warrants to Cryogen as follows:
3.1 Organization, Good Standing
and Qualification. The
Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all
requisite corporate power and authority to own its properties and
assets and to carry on its business as now conducted and as
presently proposed to be conducted. The Company has filed to become
qualified to transact business as a foreign corporation in the
State of California.
3.2 Power and Capacity;
Authorization. The
company has the necessary corporate power and authority to enter
into, execute and deliver this Agreement and the Related
Agreements, to perform its obligations hereunder and thereunder to
consummate the transactions contemplated hereby and thereby. The
execution and delivery of this Agreement and the Related Agreements
and the consummation of the transactions contemplated hereby and
thereby have been duly and validly authorized by all required
corporate action of the Company. This Agreement and the Related
Agreements have been executed and delivered by the Company and
constitute legal and binding agreements enforceable against the
Company in accordance with their respective terms (subject, as to
the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium and similar laws affecting
creditors’ rights, and, with respect to the remedy of
specific performance, equitable doctrines applicable
thereto).
* Confidential Treatment
Requested
3.
3.3 Capitalization.
Immediately prior to the Closing,
the authorized capital stock of the Company consists of the
following:
(a) Common Stock.
A total of 30,000,000 authorized
shares of Common Stock, $0.001 par value, none of which are issued
and outstanding.
(b) Preferred Stock.
A total of 15,000,000 authorized
shares of Preferred Stock, $0.001 par value, 5,645,830 of which are
designated Series A Preferred Stock and none of which are issued
and outstanding and 4,861,111 of which are designated Series B
Preferred Stock and none of which are issued
outstanding.
(c) Options, Warrants, Reserved
Shares. Except as set
forth on Schedule 3.3 hereto and for (i) the conversion
privileges of the Series A Preferred Stock to be issued hereunder
and the Series B Preferred Stock to be issued pursuant to the
Series B Financing and (ii) 1,750,000 shares of Common Stock
reserved for issuance under the Company’s 2000 Stock Option
Plan, there are no options, warrants, conversion privileges or
other rights, or agreements with respect to the issuance thereof,
presently outstanding to purchase any of the capital stock of the
Company.
3.4 Consents; No
Conflicts. The execution,
delivery and performance of this Agreement and the Related
Agreements by the Company shall not: (a) conflict with or result in
a material breach of or default under the Company’s Restated
Certificate or Bylaws; (b) result in a violation of any law, rule,
ordinance, regulation, order, judgment or decree by which the
Company is bound; or (c) conflict with or result in a material
breach of or default under any mortgage, lien, lease, license,
permit, agreement, contract or instrument to which the Company is a
party or by which the Company is bound, which conflict, breach or
default would have a material adverse effect on the Company’s
ability to perform its obligations under this Agreement.
3.5 Actions and
Proceedings. There are no
outstanding orders, judgments, injunctions, awards or decrees of
any court, governmental or regulatory body or arbitration tribunal
against or involving the Company. There are no actions, suits or
claims or legal, administrative or arbitral proceedings or, to the
Company’s knowledge, investigations (whether or not the
defense thereof or liabilities in respect thereof are covered by
insurance) pending or, to the Company’s knowledge, threatened
against or involving the Company.
3.6 Valid Issuance of
Stock.
(a) The Shares, when issued, sold and delivered in
accordance with the terms of this Agreement, shall be duly and
validly issued, fully paid and non-assessable.
(b) All outstanding shares of the capital stock of
the Company are duly and validly issued, fully paid and
non-assessable.
3.7 Liabilities.
Except for indebtedness and
reimbursements owed to Cryogen after the Closing as provided in
Section 2.1(b) hereof and amounts payable to the vendors of
the Purchased Molds Contracts, the Company has no indebtedness for
borrowed money that the Company has directly or indirectly created,
incurred, assumed, or guaranteed, or with respect to which the
Company has otherwise become directly or indirectly
liable.
4.
3.8 Exempt Offering.
Based in part upon on
Cryogen’s representations in Section 4 , the offer and
sale of the Shares to Cryogen pursuant to this Agreement are exempt
from the registration requirements of Section 5 of the Securities
Act of 1933, as amended (the “Act” ), by
virtue of Section 4(2) thereof and from the qualification
requirements of the California Corporate Securities Law of 1968, as
amended, by virtue of Section 25102(f) thereof.
3.9 Full Disclosure.
All documents and other papers
delivered by or on behalf of the Company in connection with this
Agreement and the transactions contemplated hereby are true and
complete. No representation or warranty of the Company contained in
this Agreement, and to the Company’s knowledge, no document
or other paper finished by or on behalf of the Company to Cryogen
(or any of its agents) pursuant to this Agreement or in connection
with the transactions contemplated hereby, taken as a whole,
contains an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make
the statements made, in the context in which made, not false or
misleading.
4. REPRESENTATIONS AND WARRANTIES
OF CRYOGEN TO THE COMPANY. Cryogen represents and warrants to the Company
as follows:
4.1 Organization and
Qualification. Cryogen is
a corporation duly incorporated, validly existing and in good
standing under the laws of the State of California and has all
requisite corporate power and authority to own its assets and
properties and to carry on its business as now being and as
heretofore conducted.
4.2 Power and Capacity;
Authorization. Cryogen
has the necessary corporate power and authority to enter into,
execute and deliver this Agreement and the Related Agreements, to
perform its obligations hereunder and thereunder to consummate the
transactions contemplated hereby and thereby. The execution and
delivery of this Agreement and the Related Agreements and the
consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized by all required corporate
action of Cryogen. This Agreement and the Related Agreements have
been executed and delivered by Cryogen and constitute legal and
binding agreements enforceable against Cryogen in accordance with
their respective terms (subject, as to the enforcement of remedies,
to applicable bankruptcy, reorganization, insolvency, moratorium
and similar laws affecting creditors’ rights, and, with
respect to the remedy of specific performance, equitable doctrines
applicable thereto).
4.3 Consents; No
Conflicts. Except with
respect to that certain Subordinated Loan and Security Agreement
dated March 25, 1998 between Cryogen and Comdisco, Inc. and all
instruments executed in connection therewith, that certain Master
Lease Agreement dated August 25, 1997 between Cryogen and Comdisco,
Inc. and all instruments executed in connection therewith and that
certain Master Loan and Security Agreement dated January 28, 1999
between Cryogen and Lease Management Services, Inc. and all
instruments executed in connection therewith (collectively, the
“Debt Documents” ), with respect to which
Cryogen will obtain waivers and/or consents at or prior to the
Closing pursuant to Section 7.1(k) hereof, the execution,
delivery and performance of this Agreement and the Related
Agreements by Cryogen
5.
shall not: (a) conflict with or result in a
breach of or default under Cryogen’s Articles of
Incorporation or Bylaws, as such may have been amended through the
date hereof; (b) result in a violation of any law, rule, ordinance,
regulation, order, judgment or decree by which Cryogen is bound; or
(c) conflict with or result in a breach of or default under any
mortgage, lien, lease, license, permit, agreement, contract or
instrument to which Cryogen is a party or by which Cryogen is
bound, which conflict, breach or default would have a material
adverse effect on Cryogen’s ability to perform its
obligations under this Agreement.
4.4 Actions and
Proceedings. There are no
outstanding orders, judgments, injunctions, awards or decrees of
any court, governmental or regulatory body or arbitration tribunal
against or involving Cryogen with respect to the Licensed
Technology. Except as set forth on Schedule 4.4 hereto,
there are no actions, suits or claims or legal, administrative or
arbitral proceedings or, to Cryogen’s knowledge,
investigations (whether or not the defense thereof or liabilities
in respect thereof are covered by insurance) pending or, to
Cryogen’s knowledge, threatened against or involving Cryogen
with respect to the Licensed Technology.
4.5 Intellectual
Property. Except for
liens and encumbrances arising under the Debt Documents or as
otherwise set forth on Schedule 4.5 hereto, Cryogen owns all
right, title and interest in and to the Contributed Assets and all
of the Licensed Technology to be licensed (or sublicensed) by
Cryogen to the Company pursuant to the License Agreement, free and
clear of all liens and encumbrances of third parties. Cryogen has
not granted any licenses or other rights to any third party with
respect to the Contributed Assets or any Licensed Technology.
Except for the matters set forth on Schedule 4.4 hereto, (i)
Cryogen has not received any written notice or claim challenging
its rights with respect to the Contributed Assets or any Licensed
Technology; (ii) there are no actions, suits, or proceedings
pending or, to the knowledge of Cryogen, threatened, based on an
allegation that the use or practice of the Contributed Assets or
any of the Licensed Technology by Cryogen infringes or
misappropriates the patents, copyrights, trade secrets, trademarks
or other intellectual property of any third party; and (iii) to the
knowledge of Cryogen, the use or practice by Cryogen of the
Contributed Assets or the Licensed Technology has not infringed or
resulted in the misappropriation of any patent, copyright, trade
secret or other intellectual property rights of any third
party.
4.6 Full Disclosure.
All documents and other papers
delivered by or on behalf of Cryogen in c
