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NOTE AND WARRANT PURCHASE AGREEMENT
BY AND BETWEEN
WAFERGEN, INC.
AND
ALNOOR SHIVJI
WAFERGEN, INC.
NOTE AND WARRANT PURCHASE AGREEMENT
THIS NOTE AND WARRANT PURCHASE AGREEMENT
(this
“
Agreement ”)
is made as of January 30, 2007 (the “
Effective Date ”)
by and among
WaferGen, Inc. ,
a Delaware corporation (the “
Company ”),
and Alnoor Shivji (the “
Purchaser ”).
Capitalized terms used herein and not otherwise defined herein
shall have the respective meanings given to them in the Note (as
defined below) and the Warrant (as defined below).
THE
PARTIES HEREBY AGREE AS FOLLOWS:
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1. |
AMOUNT AND TERMS OF THE LOAN; ISSUANCE OF WARRANT;
CLOSING.
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1.1
The Loan. Subject
to the terms of this Agreement, the Purchaser agrees to purchase
from the Company and the Company agrees to sell and issue to the
Purchaser the promissory notes, the aggregate principal amount of
which should not be in excess of three hundred thousand dollars
(US$300,000) (the “
Loan Amount ”
or
the “
Loan ”),
in the form attached hereto as
Exhibit A
(each,
a
“Note” and
collectively, the
“Notes” ).
1.2
Issuance of Warrant. Subject
to the terms and conditions of this Agreement, the Company agrees
to issue to the Purchaser warrants (each, a
“Warrant” and
collectively, the “
Warrants ”)
in substantially the form attached hereto as
Exhibit B ,
representing
the right to purchase up to that number of shares of Series B
Preferred Stock of the Company calculated as follows:
Number
of shares of
Series
B Preferred Stock =
(Loan Amount) x (0.25)
issuable
upon exercise $0.76
of
the Warrant
1.3
Closing. The
initial closing of the purchase and sale of the Note hereunder (the
“
Initial Closing ”)
shall occur at the principal office of the Company at 2:00 p.m. on
January __, 2007 (the “
Closing Date ”)
or at such other time as the Company and the Purchaser shall agree.
In the event there is more than one closing, the term
“Closing” shall apply to each such closing, unless
otherwise specified in this Agreement. At
or prior to the Closing, the Purchaser shall deliver to the Company
a certified check or wire transfer funds in the amount of the
Purchaser’s Loan Amount, and the Company shall issue and
deliver to the Purchaser a Note in favor of the Purchaser payable
in the principal amount of such Purchaser’s Loan Amount and
the Company shall issue and deliver to the Purchase the Warrant. In
addition, the Company shall execute, deliver and/or file such other
documents as the Purchaser shall reasonably require.
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2. |
REPRESENTATIONS AND WARRANTIES OF THE
COMPANY.
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The
Company hereby represents and warrants to the Purchaser as
follows:
2.1
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. The
Company has the requisite corporate power to own and operate its
properties and assets and to carry on its business as now conducted
and as proposed to be conducted. The Company is duly qualified and
is authorized to do business and is in good standing as a foreign
corporation in all jurisdictions in which the nature of its
activities and of its properties (both owned and leased) makes such
qualification necessary, except for those jurisdictions in which
failure to do so would not have a material adverse effect on the
Company or its business.
2.2
Corporate
Power. The
Company has all requisite corporate power to execute and deliver
this Agreement, the Note, the Warrant and any other document
relating to any of the foregoing (collectively, as the same may
from time to time be amended, modified, supplemented or restated,
the “
Loan Documents ”)
and to carry out and perform its obligations under the terms of the
Loan Documents. The Company’s Board of Directors has approved
the Loan Documents based upon a reasonable belief that the Loan is
appropriate for the Company after reasonable inquiry concerning the
Company’s financing objectives and financial
situation.
2.3
Authorization. All
corporate action on the part of the Company, its directors and its
stockholders necessary for the authorization, execution, delivery
and performance of the Loan Documents by the Company and the
performance of the Company’s obligations thereunder, has been
taken or will be taken prior to the Initial Closing. The Loan
Documents, when executed and delivered by the Company, shall
constitute valid and binding obligations of the Company enforceable
against it in accordance with their terms, subject to laws of
general application relating to bankruptcy, insolvency, and the
relief of debtors. The issuance of the Note and Warrant pursuant to
the provisions of this Agreement will not violate any preemptive
rights or rights of first refusal granted by the Company, and the
Note and Warrant will be issued in compliance with all applicable
federal and state securities laws; provided, however, that the Note
and Warrant may be subject to restrictions on transfer under state
and/or federal securities laws as set forth herein or as otherwise
required by such laws at the time the transfer is
proposed.
2.4
Governmental Consents. All
consents, approvals, orders, or authorizations of, or
registrations, qualifications, designations, declarations, or
filings with, any governmental authority, required on the part of
the Company in connection with the valid execution and delivery of
the Loan Documents, the offer, sale or issuance of the Note and the
Warrant and the equity securities issuable upon exercise of the
Warrant, conversion of the Note or the consummation of any other
transaction contemplated hereby shall have been obtained and will
be effective at each Closing, except for notices required or
permitted to be filed with certain state and federal securities
commissions, which notices will be filed on a timely
basis.
2.5
Offering. Assuming
the accuracy of the representations and warranties of the Purchaser
contained in Section 3 hereof, the offer, issuance, and sale of the
Securities are and will be exempt from the registration and
prospectus delivery requirements of the Securities Act of 1933, as
amended (the “
Securities Act ”),
and have been registered or qualified (or are exempt from
registration and qualification) under the registration, permit, or
qualification requirements of all applicable state securities
laws.
2.6
Use of Proceeds .
The Company shall use the proceeds of the Loan solely for the
operations of its business, and not for any personal, family or
household purpose.
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3. |
REPRESENTATIONS AND WARRANTIES OF THE
PURCHASER.
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3.1
Purchase for Own Account. The
Purchaser represents that he is acquiring the Note, Warrant and the
equity securities issuable upon exercise of the Warrant
(collectively, the “
Securities ”)
solely for his own account and beneficial interest for investment
and not for sale or with a view to distribution of the Securities
or any part thereof, has no present intention of selling (in
connection with a distribution or otherwise), granting any
participation in, or otherwise distributing the same, and does not
presently have reason to anticipate a change in such intention,
other than transfers between affiliates, including affiliate funds,
or transfers to a partner (or retired partner), member (or retired
member) of the Purchaser, or transfers by gift, will or intestate
succession to any spouse or lineal descendants or ancestors, if all
transferees agree in writing to be subject to the terms hereof to
the same extent as if they were Purchasers hereunder.
3.2
Information and Sophistication.
The Purchaser acknowledges that he has received all the information
he has requested from the Company and that he considers necessary
or appropriate for deciding whether to acquire the Securities. The
Purchaser represents that he has had an opportunity to ask
questions and receive answers from the Company regarding the terms
and conditions of the offering of the Securities and to obtain any
additional information necessary to verify the accuracy of the
information given the Purchaser. The Purchaser further represents
that he has such knowledge and experience in financial and business
matters that he is capable of evaluating the merits and risk of
this investment.
3.3
Ability to Bear Economic Risk. The
Purchaser acknowledges that investment in the Securities involves a
high degree of risk, and represents that he is able, without
materially impairing his financial condition, to hold the
Securities for an indefinite period of time and to suffer a
complete loss of his investment.
3.4
Restrictions on Transfer .
The
Purchaser understands that the Securities are characterized as
“restricted securities” under the federal securities
laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under such
laws and applicable regulations such securities may be resold
without registration under the Securities Act only in certain
limited circumstances. The Purchaser un
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