EXHIBIT
10.1
EXECUTION
COPY
COMMON STOCK PURCHASE
AGREEMENT
COMMON STOCK PURCHASE AGREEMENT
(the “Agreement”), dated
as of January 30, 2009 by and between SPECTRASCIENCE, INC. ,
a Minnesota corporation (the “Company”), and FUSION
CAPITAL FUND II, LLC , an Illinois limited liability company
(the “Buyer”). Capitalized terms used herein
and not otherwise defined herein are defined in Section 10
hereof.
WHEREAS:
Subject to the terms and conditions set forth in
this Agreement, the Company wishes to sell to the Buyer, and the
Buyer wishes to buy from the Company, up to Six Million Dollars
($6,000,000) of the Company's common stock, $0.01 par value per
share (the “Common Stock”). The shares of
Common Stock to be purchased hereunder are referred to herein as
the "Purchase Shares."
NOW
THEREFORE , the Company
and the Buyer hereby agree as follows:
1. PURCHASE
OF COMMON STOCK.
Subject to the
terms and conditions set forth in this Agreement, the Company has
the right to sell to the Buyer, and the Buyer has the obligation to
purchase from the Company, Purchase Shares as follows:
(a)
Commencement of Purchases of Common Stock . The
purchase and sale of Purchase Shares hereunder shall occur from
time to time upon written notices by the Company to the Buyer on
the terms and conditions as set forth herein following the
satisfaction of the conditions (the “Commencement”) as
set forth in Sections 6 and 7 below (the date of
satisfaction of such conditions, the "Commencement
Date").
(b)
The Company’s Right to Require Purchases
. Any time on or after the Commencement Date, the
Company shall have the right but not the obligation to direct the
Buyer by its delivery to the Buyer of Base Purchase Notices from
time to time to buy Purchase Shares (each such purchase a
“Base Purchase”) in any amount up to
Twenty-Five-Thousand Dollars ($25,000) per Base Purchase Notice
(the “Base Purchase Amount”) at the Purchase Price on
the Purchase Date. The Company may deliver multiple Base
Purchase Notices to the Buyer so long as at least two (2) Business
Days have passed since the most recent Base Purchase was
completed. Notwithstanding the forgoing, any time on or
after the Commencement Date, the Company shall also have the right
but not the obligation by its delivery to the Buyer of Block
Purchase Notices from time to time to direct the Buyer to buy
Purchase Shares (each such purchase a “Block Purchase”)
in any amount up to One Million Dollars ($1,000,000) per Block
Purchase Notice at the Block Purchase Price on the Purchase Date as
provided herein. For a Block Purchase Notice to be valid
the following conditions must be met: (1) the Block Purchase Amount
shall not exceed Fifty Thousand Dollars ($50,000) per Block
Purchase Notice, (2) the Company must deliver the Purchase Shares
before 11:00 a.m. eastern time on the Purchase Date and (3) the
Sale Price of the Common Stock must not be below $0.30 (subject to
equitable adjustment for any reorganization, recapitalization,
non-cash dividend, stock split or other similar transaction) during
the Purchase Date, the date of the delivery of the Block Purchase
Notice and during the Business Day prior to the delivery of the
Block Purchase Notice. The Block Purchase Amount may be
increased to up to One Hundred Thousand Dollars ($100,000) per
Block Purchase Notice if the Sale Price of the Common Stock is not
below $0.40 (subject to equitable adjustment for any
reorganization, recapitalization, non-cash dividend, stock split or
other similar transaction) during the Purchase Date, the date of
the delivery of the Block Purchase Notice and during the Business
Day prior to the delivery of the Block Purchase
Notice. The Block Purchase Amount may be increased to up
to Two Hundred Fifty Thousand Dollars ($250,000) per Block Purchase
Notice if the Sale Price of the Common Stock is not below $0.60
(subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar
transaction) during the Purchase Date, the date of the delivery of
the Block Purchase Notice and during the Business Day prior to the
delivery of the Block Purchase Notice. The Block
Purchase Amount may be increased to up to Five Hundred Thousand
Dollars ($500,000) per Block Purchase Notice if the Sale Price of
the Common Stock is not below $1.25 (subject to equitable
adjustment for any reorganization, recapitalization, non-cash
dividend, stock split or other similar transaction) during the
Purchase Date, the date of the delivery of the Block Purchase
Notice and during the Business Day prior to the delivery of the
Block Purchase Notice. The Block Purchase Amount may be increased
to up to One Million Dollars ($1,000,000) per Block Purchase Notice
if the Sale Price of the Common Stock is not below $2.50 (subject
to equitable adjustment for any reorganization, recapitalization,
non-cash dividend, stock split or other similar transaction) during
the Purchase Date, the date of the delivery of the Block Purchase
Notice and during the Business Day prior to the delivery of the
Block Purchase Notice. As used herein, the term
“Block Purchase Price” shall mean the lesser of (i) the
lowest Sale Price of the Common Stock on the Purchase Date or (ii)
the lowest Purchase Price during the previous ten (10) Business
Days prior to the date that the valid Block Purchase Notice was
received by the Buyer. However, if at any time during
the Purchase Date, the date of the delivery of the Block Purchase
Notice or during the Business Day prior to the delivery of the
Block Purchase Notice, the Sale Price of the Common Stock is below
the applicable Block Purchase threshold price, such Block Purchase
shall be void and the Buyer’s obligations to buy Purchase
Shares in respect of that Block Purchase Notice shall be
terminated. Thereafter, the Company shall again have the
right to submit a Block Purchase Notice as set forth herein by
delivery of a new Block Purchase Notice only if the Sale Price of
the Common Stock is above the applicable Block Purchase threshold
price during the date of the delivery of the Block Purchase Notice
and during the Business Day prior to the delivery of the Block
Purchase Notice. The Company may deliver multiple Block
Purchase Notices to the Buyer so long as at least two (2) Business
Days have passed since the most recent Block Purchase was
completed.
(c)
Payment for Purchase Shares . The Buyer shall pay
to the Company an amount equal to the Purchase Amount with respect
to such Purchase Shares as full payment for such Purchase Shares
via wire transfer of immediately available funds on the same
Business Day that the Buyer receives such Purchase Shares if they
are received by the Buyer before 11:00 a.m. eastern time or if
received by the Buyer after 11:00 a.m. eastern time, the next
Business Day. The Company shall not issue any fraction
of a share of Common Stock upon any purchase. If the
issuance would result in the issuance of a fraction of a share of
Common Stock, the Company shall round such fraction of a share of
Common Stock up or down to the nearest whole share. All
payments made under this Agreement shall be made in lawful money of
the United States of America or wire transfer of immediately
available funds to such account as the Company may from time to
time designate by written notice in accordance with the provisions
of this Agreement. Whenever any amount expressed to be
due by the terms of this Agreement is due on any day that is not a
Business Day, the same shall instead be due on the next succeeding
day that is a Business Day.
(d)
Purchase Price Floor . The Company and the Buyer
shall not effect any sales under this Agreement on any Purchase
Date where the Purchase Price for any purchases of Purchase Shares
would be less than the Floor Price. “Floor
Price” means $0.15, which shall be appropriately adjusted for
any reorganization, recapitalization, non-cash dividend, stock
split or other similar transaction.
(e)
Records of Purchases . The Buyer and the Company
shall each maintain records showing the remaining Available Amount
at any give time and the dates and Purchase Amounts for each
purchase or shall use such other method, reasonably satisfactory to
the Buyer and the Company.
(f)
Taxes . The Company shall pay any and all
transfer, stamp or similar taxes that may be payable with respect
to the issuance and delivery of any shares of Common Stock to the
Buyer made under this Agreement.
2. BUYER'S
REPRESENTATIONS AND WARRANTIES.
The Buyer represents and warrants to the Company
that as of the date hereof and as of the Commencement
Date:
(a)
Investment Purpose . The Buyer is entering into
this Agreement and acquiring the Commitment Shares, (as defined in
Section 4(e) hereof) (this Agreement, the Purchase Shares and the
Commitment Shares are collectively referred to herein as the
"Securities"), for its own account for investment only and not with
a view towards, or for resale in connection with, the public sale
or distribution thereof; provided however, by making the
representations herein, the Buyer does not agree to hold any of the
Securities for any minimum or other specific term.
(b)
Accredited Investor Status . The Buyer is an
"accredited investor" as that term is defined in Rule 501(a)(3) of
Regulation D.
(c)
Reliance on Exemptions . The Buyer understands
that the Securities are being offered and sold to it in reliance on
specific exemptions from the registration requirements of United
States federal and state securities laws and that the Company is
relying in part upon the truth and accuracy of, and the Buyer's
compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Buyer set forth herein in
order to determine the availability of such exemptions and the
eligibility of the Buyer to acquire the Securities.
(d)
Information . The Buyer has been furnished with
all materials relating to the business, finances and operations of
the Company and materials relating to the offer and sale of the
Securities that have been reasonably requested by the Buyer,
including, without limitation, the SEC Documents (as defined in
Section 3(f) hereof). The Buyer understands that its
investment in the Securities involves a high degree of
risk. The Buyer (i) is able to bear the economic risk of
an investment in the Securities including a total loss, (ii) has
such knowledge and experience in financial and business matters
that it is capable of evaluating the merits and risks of the
proposed investment in the Securities and (iii) has had an
opportunity to ask questions of and receive answers from the
officers of the Company concerning the financial condition and
business of the Company and others matters related to an investment
in the Securities. Neither such inquiries nor any other
due diligence investigations conducted by the Buyer or its
representatives shall modify, amend or affect the Buyer's right to
rely on the Company's representations and warranties contained in
Section 3 below. The Buyer has sought such accounting,
legal and tax advice as it has considered necessary to make an
informed investment decision with respect to its acquisition of the
Securities.
(e)
No Governmental Review . The Buyer understands
that no United States federal or state agency or any other
government or governmental agency has passed on or made any
recommendation or endorsement of the Securities or the fairness or
suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of
the Securities.
(f)
Transfer or Sale . The Buyer understands that
except as provided in the Registration Rights Agreement (as defined
in Section 4(a) hereof): (i) the Securities have not been and are
not being registered under the 1933 Act or any state securities
laws, and may not be offered for sale, sold, assigned or
transferred unless (A) subsequently registered thereunder or (B) an
exemption exists permitting such Securities to be sold, assigned or
transferred without such registration; (ii) any sale of the
Securities made in reliance on Rule 144 may be made only in
accordance with the terms of Rule 144 and further, if Rule 144 is
not applicable, any resale of the Securities under
circumstances in which the seller (or the person through whom the
sale is made) may be deemed to be an underwriter (as that term is
defined in the 1933 Act) may require compliance with some other
exemption under the 1933 Act or the rules and regulations of the
SEC thereunder; and (iii) neither the Company nor any other person
is under any obligation to register the Securities under the 1933
Act or any state securities laws or to comply with the terms and
conditions of any exemption thereunder.
(g)
Validity; Enforcement . This Agreement has been
duly and validly authorized, executed and delivered on behalf of
the Buyer and is a valid and binding agreement of the Buyer
enforceable against the Buyer in accordance with its terms, subject
as to enforceability to general principles of equity and to
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation and other similar laws relating to, or affecting
generally, the enforcement of applicable creditors' rights and
remedies.
(h)
Residency . The Buyer is a resident of the State
of Illinois.
(i)
No Prior Short Selling . The Buyer represents and
warrants to the Company that at no time prior to the date of this
Agreement has any of the Buyer, its agents, representatives or
affiliates engaged in or effected, in any manner whatsoever,
directly or indirectly, any (i) "short sale" (as such term is
defined in Section 242.200 of Regulation SHO of the Securities
Exchange Act of 1934, as amended (the "1934 Act")) of the Common
Stock or (ii) hedging transaction, which establishes a net short
position with respect to the Common Stock.
3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to the Buyer
that as of the date hereof and as of the Commencement
Date:
(a)
Organization and Qualification . The Company and
its "Subsidiaries" (which for purposes of this Agreement means any
entity in which the Company, directly or indirectly, owns 50% or
more of the voting stock or capital stock or other similar equity
interests) are corporations duly organized and validly existing in
good standing under the laws of the jurisdiction in which they are
incorporated, and have the requisite corporate power and authority
to own their properties and to carry on their business as now being
conducted. Each of the Company and its Subsidiaries is
duly qualified as a foreign corporation to do business and is in
good standing in every jurisdiction in which its ownership of
property or the nature of the business conducted by it makes such
qualification necessary, except to the extent that the failure to
be so qualified or be in good standing could not reasonably be
expected to have a Material Adverse Effect. As used in
this Agreement, "Material Adverse Effect" means any material
adverse effect on any of: (i) the business, properties, assets,
operations, results of operations or financial condition of the
Company and its Subsidiaries, if any, taken as a whole, or (ii) the
authority or ability of the Company to perform its obligations
under the Transaction Documents (as defined in Section 3(b)
hereof). The Company has no Subsidiaries except as set
forth on Schedule 3(a).
(b)
Authorization; Enforcement; Validity . (i) The
Company has the requisite corporate power and authority to enter
into and perform its obligations under this Agreement, the
Registration Rights Agreement and each of the other
agreements entered into by the parties on the Commencement Date and
attached hereto as exhibits to this Agreement (collectively, the
"Transaction Documents"), and to issue the Securities in accordance
with the terms hereof and thereof, (ii) the execution and delivery
of the Transaction Documents by the Company and the consummation by
it of the transactions contemplated hereby and thereby, including
without limitation, the issuance of the Commitment Shares and the
reservation for issuance and the issuance of the Purchase Shares
issuable under this Agreement, have been duly authorized by the
Company's Board of Directors and no further consent or
authorization is required by the Company, its Board of Directors or
its shareholders, (iii) this Agreement has been, and each other
Transaction Document shall be on the Commencement Date, duly
executed and delivered by the Company and (iv) this Agreement
constitutes, and each other Transaction Document upon its execution
on behalf of the Company, shall constitute, the valid and binding
obligations of the Company enforceable against the Company in
accordance with their terms, except as such enforceability may be
limited by general principles of equity or applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of creditors'
rights and remedies. The Board of Directors of the
Company has approved the resolutions (the “Signing
Resolutions”) substantially in the form as set forth as
Exhibit C-1 attached hereto to authorize this Agreement and
the transactions contemplated hereby. The Signing
Resolutions are valid, in full force and effect and have not been
modified or supplemented in any respect other than by the
resolutions set forth in Exhibit C-2 attached hereto
regarding the registration statement referred to in Section 4
hereof. The Company has delivered to the Buyer a true
and correct copy of a unanimous written consent adopting the
Signing Resolutions executed by all of the members of the Board of
Directors of the Company. No other approvals or consents
of the Company’s Board of Directors and/or shareholders is
necessary under applicable laws and the Company’s Certificate
of Incorporation and/or Bylaws to authorize the execution and
delivery of this Agreement or any of the transactions contemplated
hereby, including, but not limited to, the issuance of the
Commitment Shares and the issuance of the Purchase
Shares.
(c)
Capitalization . As of the date hereof, the
authorized capital stock of the Company consists of (i) 100,000,000
shares of Common Stock and 25,000,000 undesignated shares, of which
as of the date hereof, 68,602,636 shares are issued and
outstanding, 0 are held as treasury shares, 10,290,395
shares are reserved for issuance pursuant to the Company's stock
option plans of which only approximately 1,940,395 shares remain
available for future grants and 787,453 warrant shares are issuable
and reserved for issuance pursuant to securities (other than stock
options issued pursuant to the Company's stock option plans)
exercisable or exchangeable for, or convertible into, shares of
Common Stock and (ii) 0 shares of Preferred Stock are issued and
outstanding. All of such outstanding shares have been,
or upon issuance will be, validly issued and are fully paid and
nonassessable. Except as disclosed in Schedule 3(c), (i)
no shares of the Company's capital stock are subject to preemptive
rights or any other similar rights or any liens or encumbrances
suffered or permitted by the Company, (ii) there are no outstanding
debt securities, (iii) there are no other outstanding options,
warrants, scrip, rights to subscribe to, calls or commitments of
any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any
of its Subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or
may become bound to issue additional shares of capital stock of the
Company or any of its Subsidiaries or options, warrants, scrip,
rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into,
any shares of capital stock of the Company or any of its
Subsidiaries, (iv) there are no agreements or arrangements under
which the Company or any of its Subsidiaries is obligated to
register the sale of any of their securities under the 1933 Act
(except the Registration Rights Agreement) other than registration
rights as described in Schedule 3(c), (v) there are no outstanding
securities or instruments of the Company or any of its Subsidiaries
which contain any redemption or similar provisions, and there are
no contracts, commitments, understandings or arrangements by which
the Company or any of its Subsidiaries is or may become bound to
redeem a security of the Company or any of its Subsidiaries, (vi)
there are no securities or instruments containing anti-dilution or
similar provisions that will be triggered by the issuance of the
Securities as described in this Agreement and (vii) the Company
does not have any stock appreciation rights or "phantom stock"
plans or agreements or any similar plan or
agreement. The Company has furnished to the Buyer true
and correct copies of the Company's Certificate of Incorporation,
as amended and as in effect on the date hereof (the "Certificate of
Incorporation"), and the Company's By-laws, as amended and as in
effect on the date hereof (the "By-laws"), and summaries of the
terms of all securities convertible into or exercisable for Common
Stock, if any, and copies of any documents containing the material
rights of the holders thereof in respect thereto.
(d)
Issuance of Securities . The Commitment Shares
have been duly authorized and, upon issuance in accordance with the
terms hereof, the Commitment Shares shall be (i) validly issued,
fully paid and non-assessable and (ii) free from all taxes, liens
and charges with respect to the issue thereof. 11,558,974 shares of
Common Stock have been duly authorized and reserved for issuance
upon purchase under this Agreement. 547,009 shares of Common Stock
(subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar
transaction) have been duly authorized and reserved for issuance as
Additional Commitment Shares in accordance with Section 4(e) of
this Agreement. Upon issuance and payment therefore
in accordance with the terms and conditions of this Agreement, the
Purchase Shares shall be validly issued, fully paid and
nonassessable and free from all taxes, liens and charges with
respect to the issue thereof, with the holders being entitled to
all rights accorded to a holder of Common Stock.
(e)
No Conflicts . Except as disclosed in Schedule
3(e), the execution, delivery and performance of the Transaction
Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby (including, without
limitation, the reservation for issuance and issuance of the
Purchase Shares) will not (i) result in a violation of the
Certificate of Incorporation, any Certificate of Designations,
Preferences and Rights of any outstanding series of preferred stock
of the Company or the By-laws or (ii) conflict with, or constitute
a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of
its Subsidiaries is a party, or result in a violation of any law,
rule, regulation, order, judgment or decree (including federal and
state securities laws and regulations and the rules and regulations
of the Principal Market applicable to the Company or any of its
Subsidiaries) or by which any property or asset of the Company or
any of its Subsidiaries is bound or affected, except in the case of
conflicts, defaults, terminations, amendments, accelerations,
cancellations and violations under clause (ii), which could not
reasonably be expected to result in a Material Adverse
Effect. Except as disclosed in Schedule 3(e), neither
the Company nor its Subsidiaries is in violation of any term of or
in default under its Certificate of Incorporation, any Certificate
of Designation, Preferences and Rights of any outstanding series of
preferred stock of the Company or By-laws or their organizational
charter or by-laws, respectively. Except as disclosed in
Schedule 3(e), neither the Company nor any of its Subsidiaries is
in violation of any term of or is in default under any material
contract, agreement, mortgage, indebtedness, indenture, instrument,
judgment, decree or order or any statute, rule or regulation
applicable to the Company or its Subsidiaries, except for possible
conflicts, defaults, terminations or amendments which could not
reasonably be expected to have a Material Adverse
Effect. The business of the Company and its Subsidiaries
is not being conducted, and shall not be conducted, in violation of
any law, ordinance, regulation of any governmental entity, except
for possible violations, the sanctions for which either
individually or in the aggregate could not reasonably be expected
to have a Material Adverse Effect. Except as
specifically contemplated by this Agreement and as required under
the 1933 Act or applicable state securities laws, the Company is
not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental
agency or any regulatory or self-regulatory agency in order for it
to execute, deliver or perform any of its obligations under or
contemplated by the Transaction Documents in accordance with the
terms hereof or thereof. Except as disclosed in Schedule
3(e), all consents, authorizations, orders, filings and
registrations which the Company is required to obtain pursuant to
the preceding sentence shall be obtained or effected on or prior to
the Commencement Date. Except as listed in Schedule
3(e), since January 1, 2008 the Company has not received nor
delivered any notices or correspondence from or to the Principal
Market. The Principal Market has not commenced any
delisting proceedings against the Company.
(f)
SEC Documents; Financial Statements . Except as disclosed in
Schedule 3(f), since January 1, 2008, the Company has timely filed
all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting
requirements of the 1934 Act (all of the foregoing filed prior to
the date hereof and all exhibits included therein and financial
statements and schedules thereto and documents incorporated by
reference therein being hereinafter referred to as the "SEC
Documents"). As of their respective dates (except as
they have been correctly amended), the SEC Documents complied in
all material respects with the requirements of the 1934 Act and the
rules and regulations of the SEC promulgated thereunder applicable
to the SEC Documents, and none of the SEC Documents, at the time
they were filed with the SEC (except as they may have been properly
amended), contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not
misleading. As of their respective dates (except as they
have been properly amended), the financial statements of the
Company included in the SEC Documents complied as to form in all
material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect
thereto. Such financial statements have been prepared in
accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (i) as
may be otherwise indicated in such financial statements or the
notes thereto or (ii) in the case of unaudited interim statements,
to the extent they may exclude footnotes or may be condensed or
summary statements) and fairly present in all material respects the
financial position of the Company as of the dates thereof and the
results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end
audit adjustments). Except as listed in Schedule 3(f),
the Company has received no notices or correspondence from the SEC
since January 1, 2008. The SEC has not commenced any
enforcement proceedings against the Company or any of its
subsidiaries.
(g)
Absence of Certain Changes . Except as disclosed
in Schedule 3(g), since September 30, 2008, there has been no
material adverse change in the business, properties, operations,
financial condition or results of operations of the Company or its
Subsidiaries. The Company has not taken any steps, and
does not currently expect to take any steps, to seek protection
pursuant to any Bankruptcy Law nor does the Company or any of its
Subsidiaries have any knowledge or reason to believe that its
creditors intend to initiate involuntary bankruptcy
or insolvency proceedings. The Company is financially
solvent and is generally able to pay its debts as they become due
.
(h)
Absence of Litigation . There is no action, suit,
proceeding, inquiry or investigation before or by any court, public
board, government agency, self-regulatory organization or body
pending or, to the knowledge of the Company or any of its
Subsidiaries, threatened against or affecting the Company, the
Common Stock or any of the Company's Subsidiaries or any of the
Company's or the Company's Subsidiaries' officers or directors in
their capacities as such, which could reasonably be expected to
have a Material Adverse Effect. A description of
each action, suit, proceeding, inquiry or investigation before or
by any court, public board, government agency, self-regulatory
organization or body which, as of the date of this Agreement, is
pending or threatened in writing against or affecting the Company,
the Common Stock or any of the Company's Subsidiaries or any of the
Company's or the Company's Subsidiaries' officers or directors in
their capacities as such, is set forth in Schedule 3(h).
(i)
Acknowledgment Regarding Buyer's Status . The
Company acknowledges and agrees that the Buyer is acting solely in
the capacity of arm's length purchaser with respect to the
Transaction Documents and the transactions contemplated hereby and
thereby. The Company further acknowledges that the Buyer
is not acting as a financial advisor or fiduciary of the Company
(or in any similar capacity) with respect to the Transaction
Documents and the transactions contemplated hereby and thereby and
any advice given by the Buyer or any of its representatives or
agents in connection with the Transaction Documents and the
transactions contemplated hereby and thereby is merely incidental
to the Buyer's purchase of the Securities. The Company
further represents to the Buyer that the Company's decision to
enter into the Transaction Documents has been based solely on the
independent evaluation by the Company and its representatives and
advisors.
(j)
No General Solicitation . Neither the Company,
nor any of its affiliates, nor any person acting on its or their
behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D under the 1933 Act)
in connection with the offer or sale of the Securities.
(k)
Intellectual Property Rights . The Company and
its Subsidiaries own or possess adequate rights or licenses to use
all material trademarks, trade names, service marks, service mark
registrations, service names, patents, patent rights, copyrights,
inventions, licenses, approvals, governmental authorizations, trade
secrets and rights necessary to conduct their respective businesses
as now conducted. Except as set forth on Schedule 3(k),
none of the Company's material trademarks, trade names, service
marks, service mark registrations, service names, patents, patent
rights, copyrights, inventions, licenses, approvals, government
authorizations, trade secrets or other intellectual property rights
have expired or terminated, or, by the terms and conditions
thereof, could expire or terminate within two years from the date
of this Agreement. The Company and its Subsidiaries do
not have any knowledge of any infringement by the Company or its
Subsidiaries of any material trademark, trade name rights, patents,
patent rights, copyrights, inventions, licenses, service names,
service marks, service mark registrations, trade secret or other
similar rights of others, or of any such development of similar or
identical trade secrets or technical information by others and,
except as set forth on Schedule 3(k), there is no claim, action or
proceeding being made or brought against, or to the Company's
knowledge, being threatened against, the Company or its
Subsidiaries regarding trademark, trade name, patents, patent
rights, invention, copyright, license, service names, service
marks, service mark registrations, trade secret or other
infringement, which could reasonably be expected to have a Material
Adverse Effect.
(l)
Environmental Laws . The Company and its
Subsidiaries (i) are in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to
the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”), (ii)
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