This STOCK
PURCHASE AGREEMENT (this “ Agreement ”) is made
as of June 30, 2009, by and among Echo Therapeutics, Inc., a
Delaware corporation (the “ Company ”), and each
of the purchasers of the Series B Preferred Stock of the
Company whose names are set forth on Exhibit A attached
hereto (each a “ Purchaser ” and collectively,
the “ Purchasers ”).
WHEREAS, the
Company is issuing Series B Preferred Stock and detachable
shares of Common Stock of the Company in exchange for cash or the
extinguishment of outstanding promissory notes, as further set
forth below.
The parties hereto
agree as follows:
PURCHASE AND SALE OF
STOCK
Section 1.1
Purchase and Sale of Series B Preferred Stock.
(a) Upon
the following terms and conditions, the Company shall issue and
sell to the Purchasers, and the Purchasers shall, severally and not
jointly, purchase from the Company up to three hundred
(300) shares of Series B Preferred Stock and Common Stock
(defined below) with the terms set forth in that certain
Certificate of Designation, Preferences and Rights of Series B
Preferred Stock of the Company (the “ Series B
Preferred Stock ”). The Company and the Purchasers are
executing and delivering this Agreement in accordance with and in
reliance upon the exemption from securities registration afforded
by Section 4(2) of the U.S. Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder (the
“ Securities Act ”), including Regulation D
(“ Regulation D ”), and/or upon such other
exemption from the registration requirements of the Securities Act
as may be available with respect to any or all of the investments
to be made hereunder.
(b) Upon
the following terms and conditions, the Purchasers shall be issued,
on a pro rata basis, (i) five hundred thousand (500,000)
restricted shares of the Company’s common stock, par value
$0.01 per share (the “ Common Stock ”) for each
one million dollars ($1,000,000) of Series B Preferred Stock
stated value purchased hereunder and (ii) an additional two
hundred two thousand (202,000) restricted shares of the
Company’s Common Stock shall be issued to any Purchaser who
purchases at least two million dollars ($2,000,000) of
Series B Preferred Stock stated value hereunder; provided,
however , if as a result of the foregoing, any Purchaser or any
of its affiliates, individually or in the aggregate would
beneficially own (as determined in accordance with Section 13(d) of
the Securities Exchange Act of 1934, as amended, and the rules
thereunder) more than 9.99% of the Company’s issued and
outstanding Common Stock (“ Threshold Amount ”),
the Holder will receive Common Stock rounded to the nearest whole
share, up to the Threshold Amount, and the remaining Common Stock
would be exchanged for Series C Preferred Stock convertible
into the number of shares of Common Stock equal to the difference
between the aggregate number of shares of Common Stock to be issued
to the Holder and the actual number of shares of Common Stock
issued in accordance with this
paragraph. The
Certificate of Designation of the Relative Rights and Preferences
of the Series C Preferred Stock is attached to this Agreement
as Exhibit E . As of the date of this Agreement, each
share of Common Stock (or as-converted share of Series C
Stock) shall be deemed to have a purchase price of $1.51 per
share.
Section 1.2
Purchase Price and Closing . Subject to the terms and
conditions hereof, the Company agrees to issue and sell to the
Purchasers and, in consideration of and in express reliance upon
the representations, warranties, covenants, terms and conditions of
this Agreement, the Purchasers, severally but not jointly, agree to
purchase the Series B Preferred Stock, Common Stock and
Series C Preferred Stock for an aggregate purchase price equal
to the aggregate amount set forth in Exhibit A (the
“ Purchase Price ”). The sale of the
Series B Preferred Stock, Common Stock and Series C
Preferred Stock to the Purchasers shall take place through a
closing or series of closings under this Agreement (each referred
to as the “ Closing ”), the first of which shall
take place on or before June 30, 2009 in an aggregate amount
of at least two million dollars ($2,000,000) and the remainder of
which shall take place on or before July 15, 2009 (each such
date referred to as the “ Closing Date ”).
Exhibit A to this Agreement shall be amended from time
to time to reflect any additional Closings, without any further
action of the parties hereto. Each Closing of the purchase and sale
of the Series B Preferred Stock to be acquired by the
Purchasers from the Company under this Agreement shall take place
at the offices of the Company, 10 Forge Parkway, Franklin,
Massachusetts 02038, 10:00 a.m. New York time; provided
, that all of the conditions set forth in Article IV hereof
and applicable to the Closing shall have been fulfilled or waived
in accordance herewith. Subject to the terms and conditions of this
Agreement, at the Closing, upon payment of the Purchase Price, the
Company shall deliver or cause to be delivered to each Purchaser
(x) the number of shares of Series B Preferred Stock set
forth opposite the name of such Purchaser on Exhibit A
hereto and (y) the number of shares of Common Stock (and
Series C Preferred Stock, if applicable) set forth opposite
the name of such Purchaser on Exhibit A hereto. At the
Closing, each Purchaser shall deliver its Purchase Price. The
Series B Preferred Stock, the Common Stock and the
Series C Preferred Stock are sometimes collectively referred
to herein as the “ Securities .”
REPRESENTATIONS AND
WARRANTIES
Section 2.1
Representations and Warranties of the Company . The Company
hereby represents and warrants to the Purchasers, as of the date
hereof and the Closing Date (except as set forth on the Schedule of
Exceptions attached hereto with each numbered Schedule
corresponding to the section number herein), as follows:
(a)
Organization, Good Standing and Power . The Company is a
corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has the
requisite corporate power to own, lease and operate its properties
and assets and to conduct its business as it is now being
conducted. The Company does not have any direct or indirect
Subsidiaries (as defined in Section 2.1(g)) or own securities
of any kind in any other entity except as set forth on
Schedule 2.1(g) hereto. The Company and each such
Subsidiary (as defined in Section 2.1(g)) is duly qualified as
a foreign corporation to do business and is in good
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standing in
every jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary except for
any jurisdiction(s) (alone or in the aggregate) in which the
failure to be so qualified will not have a Material Adverse Effect.
For the purposes of this Agreement, “ Material Adverse
Effect ” means any material adverse effect on the
business, operations, properties, prospects, or financial condition
of the Company and its Subsidiaries and/or any condition,
circumstance, or situation that would prohibit or otherwise
materially interfere with the ability of the Company to perform any
of its obligations under this Agreement or any of the Transaction
Documents in any material respect.
(b)
Authorization; Enforcement . The Company has the requisite
corporate power and authority to enter into and perform this
Agreement, the Officer’s Certificate to be delivered by the
Company, dated as of the Closing Date, substantially in the form of
Exhibit B attached hereto (the “
Officer’s Certificate ”) and the Irrevocable
Transfer Agent Instructions (as defined in Section 3.16
hereof) (collectively, the “ Transaction Documents
”) and to issue and sell the Securities in accordance with
the terms hereof. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by it of
the transactions contemplated thereby have been duly and validly
authorized by all necessary corporate action, and, except as set
forth on Schedule 2.1(b) , no further consent or
authorization of the Company, its Board of Directors or
stockholders is required. When executed and delivered by the
Company, each of the Transaction Documents shall constitute a valid
and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as such enforceability
may be limited by applicable bankruptcy, reorganization,
moratorium, liquidation, conservatorship, receivership or similar
laws relating to, or affecting generally the enforcement of,
creditor’s rights and remedies or by other equitable
principles of general application.
(c)
Capitalization . The authorized capital stock and the issued
and outstanding shares of capital stock of the Company as of the
Closing Date is set forth on Schedule 2.1(c) hereto. All of
the outstanding shares of the Common Stock and any other
outstanding security of the Company have been duly and validly
authorized. Except as set forth in this Agreement, the Commission
Documents (as defined in Section 2.1(f)) or as set forth on
Schedule 2.1(c) hereto, no shares of Common Stock or any
other security of the Company are entitled to preemptive rights or
registration rights and there are no outstanding options, warrants,
scrip, rights to subscribe to, call or commitments of any character
whatsoever relating to, or securities or rights convertible into,
any shares of capital stock of the Company. Furthermore, except as
set forth in this Agreement and as set forth on
Schedule 2.1(c) hereto, there are no contracts,
commitments, understandings, or arrangements by which the Company
is or may become bound to issue additional shares of the capital
stock of the Company or options, securities or rights convertible
into shares of capital stock of the Company. Except for customary
transfer restrictions contained in agreements entered into by the
Company in order to sell restricted securities or as provided on
Schedule 2.1(c) hereto, the Company is not a party to
or bound by any agreement or understanding granting registration or
anti-dilution rights to any person with respect to any of its
equity or debt securities. Except as set forth on
Schedule 2.1(c) , the Company is not a party to, and it
has no knowledge of, any agreement or understanding restricting the
voting or transfer of any shares of the capital stock of the
Company.
(d)
Issuance of Securities . The Series B Preferred Stock,
the Common Stock and the Series C Preferred Stock to be issued
at the Closing have been duly authorized by all
3
necessary
corporate action. When the Series B Preferred Stock, Common
Stock and Series C Preferred Stock are issued and paid for in
accordance with the terms of this Agreement and as set forth in the
Certificate of Designation, Preferences and Rights of the
Series B Preferred Stock and the Certificate of Designation,
Preferences and Rights of the Series C Preferred Stock, such
shares will be duly authorized by all necessary corporate action
and validly issued and outstanding, fully paid and nonassessable,
free and clear of all liens, encumbrances and rights of refusal of
any kind and the holders shall be entitled to, in the case of the
Series B Preferred Stock, all rights set forth in the
Certificate of Designation, Preferences and Rights of the
Series B Preferred Stock, in the case of the Series C
Preferred Stock, all rights set forth in the Certificate of
Designation, Preferences and Rights of the Series C Preferred
Stock, and with respect to the Common Stock, all rights accorded to
a holder of Common Stock. When the shares issued upon conversion of
the Series C Preferred Stock are issued upon conversion of the
Series C Preferred Stock, such shares will be duly authorized
by all necessary corporate action and validly issued and
outstanding, fully paid and nonassessable, free and clear of all
taxes, liens, encumbrances and rights of refusal of any kind and
the holders shall be entitled to all rights accorded to a holder of
Common Stock.
(e)
No Conflicts . The execution, delivery and performance of
the Transaction Documents by the Company and the Subsidiaries, the
consummation by the Company and the Subsidiaries of the
transactions contemplated hereby and thereby, and the issuance of
the Securities as contemplated hereby, do not and will not
(i) violate or conflict with any provision of the
Company’s Articles of Incorporation (the “
Articles ”) or Bylaws (the “ Bylaws
”), each as amended to date, or any Subsidiary’s
comparable charter documents, (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, mortgage, deed of trust, indenture, note, bond,
license, lease agreement, instrument or obligation to which the
Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries’ respective properties or
assets are bound, (iii) result in a violation of any federal,
state, local or foreign statute, rule, regulation, order, judgment
or decree (including federal and state securities laws and
regulations) applicable to the Company or any of its Subsidiaries
or by which any property or asset of the Company or any of its
Subsidiaries are bound or affected, or (iv) create or impose a
lien, mortgage, security interest, charge or encumbrance of any
nature on any property or asset of the Company or its Subsidiaries
under any agreement or any commitment to which the Company or any
of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries is bound or by which any of their respective
properties or assets are bound, except, in all cases, for such
conflicts, defaults, terminations, amendments, acceleration,
cancellations and violations as would not, individually or in the
aggregate, have a Material Adverse Effect (other than violations
pursuant to clauses (i) or (iii)). Neither the Company nor any
of its Subsidiaries is required under federal, state, foreign or
local law, rule or regulation to obtain any consent, authorization
or order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform
any of its obligations under the Transaction Documents or issue and
sell the Securities in accordance with the terms hereof and the
terms of the Series B Preferred Stock, the Series C
Preferred Stock and the Common Stock (other than any filings,
consents and approvals which may be required to be made by the
Company under applicable state and federal securities laws, rules
or regulations). The business of the Company and its Subsidiaries
is not being conducted in violation of any laws, ordinances or
regulations of any governmental entity.
4
(f)
Commission Documents, Financial Statements . The Common
Stock of the Company is registered pursuant to Section 12(b) or
12(g) of the Securities Exchange Act of 1934, as amended (the
“ Exchange Act ”), and the Company has filed all
reports, schedules, forms, statements and other documents required
to be filed by it with the Commission pursuant to the reporting
requirements of the Exchange Act (all of the foregoing including
filings incorporated by reference therein being referred to herein
as the “ Commission Documents ”). At the times
of their respective filings, the Form 10-Q for the fiscal quarter
ended March 31, 2009 (“ Form 10-Q ”)
and the Form 10-K for the fiscal year ended December 31, 2008
(“ Form 10-K ”) complied in all material
respects with the requirements of the Exchange Act and the rules
and regulations of the Commission promulgated thereunder and other
federal, state and local laws, rules and regulations applicable to
such documents, and the Form 10-Q and Form 10-K did not contain any
untrue statement of a material fact or omit 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, the
financial statements of the Company included in the Commission
Documents complied as to form in all material respects with
applicable accounting requirements and the published rules and
regulations of the Commission or other applicable rules and
regulations with respect thereto. Such financial statements have
been prepared in accordance with generally accepted accounting
principles (“ GAAP ”) applied on a consistent
basis 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 not include footnotes or may be condensed or
summary statements), and fairly present in all material respects
the financial position of the Company and its Subsidiaries as of
the dates thereof and the results of operations and cash flows for
the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments).
(g)
Subsidiaries . Schedule 2.1(g) hereto sets forth
each Subsidiary of the Company, showing the jurisdiction of its
incorporation or organization and showing the percentage of each
person’s ownership of the outstanding stock or other
interests of such Subsidiary. For the purposes of this Agreement,
“ Subsidiary ” shall mean any corporation or
other entity of which at least a majority of the securities or
other ownership interest having ordinary voting power (absolutely
or contingently) for the election of directors or other persons
performing similar functions are at the time owned directly or
indirectly by the Company and/or any of its other Subsidiaries. All
of the outstanding shares of capital stock of each Subsidiary have
been duly authorized and validly issued, and are fully paid and
nonassessable. Except as set forth on Schedule 2.1(g)
hereto, there are no outstanding preemptive, conversion or other
rights, options, warrants or agreements granted or issued by or
binding upon any Subsidiary for the purchase or acquisition of any
shares of capital stock of any Subsidiary or any other securities
convertible into, exchangeable for or evidencing the rights to
subscribe for any shares of such capital stock. Neither the Company
nor any Subsidiary is subject to any obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any shares
of the capital stock of any Subsidiary or any convertible
securities, rights, warrants or options of the type described in
the preceding sentence except as set forth on
Schedule 2.1(g) hereto. Neither the Company nor any
Subsidiary is party to, nor has any knowledge of, any agreement
restricting the voting or transfer of any shares of the capital
stock of any Subsidiary.
5
(h)
No Material Adverse Change . Since December 31, 2008,
the Company has not experienced or suffered any Material Adverse
Effect, except as disclosed on Schedule 2.1(h)
hereto.
(i)
No Undisclosed Liabilities . Except as disclosed on
Schedule 2.1(i) hereto, neither the Company nor any of
its Subsidiaries has incurred any liabilities, obligations, claims
or losses (whether liquidated or unliquidated, secured or
unsecured, absolute, accrued, contingent or otherwise) other than
those incurred in the ordinary course of the Company’s or its
Subsidiaries respective businesses or which, individually or in the
aggregate, are not reasonably likely to have a Material Adverse
Effect.
(j)
No Undisclosed Events or Circumstances . Since
December 31, 2008, except as disclosed on
Schedule 2.1(j) hereto, no event or circumstance has
occurred or exists with respect to the Company or its Subsidiaries
or their respective businesses, properties, prospects, operations
or financial condition, which, under applicable law, rule or
regulation, requires public disclosure or announcement by the
Company but which has not been so publicly announced or
disclosed.
(k)
Indebtedness . Schedule 2.1(k) hereto sets forth
as of the date hereof all outstanding secured and unsecured
Indebtedness of the Company or any Subsidiary, or for which the
Company or any Subsidiary has commitments. For the purposes of this
Agreement, “Indebtedness” shall mean (a) any
liabilities for borrowed money or amounts owed in excess of
$250,000 (other than trade accounts payable incurred in the
ordinary course of business), (b) all guaranties, endorsements
and other contingent obligations in respect of Indebtedness of
others, whether or not the same are or should be reflected in the
Company’s balance sheet (or the notes thereto), except
guaranties by endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of
business; and (c) the present value of any lease payments in
excess of $100,000 due under leases required to be capitalized in
accordance with GAAP. Neither the Company nor any Subsidiary is in
default with respect to any Indebtedness.
(l)
Title to Assets . Each of the Company and the Subsidiaries
has good and valid title to all of its real and personal property
reflected in the Commission Documents, free and clear of any
mortgages, pledges, charges, liens, security interests or other
encumbrances, except for those indicated on
Schedule 2.1(l) hereto or such that, individually or in
the aggregate, do not cause a Material Adverse Effect. Any leases
of the Company and each of its Subsidiaries are valid and
subsisting and in full force and effect.
(m)
Actions Pending . There is no action, suit, claim,
investigation, arbitration, alternate dispute resolution proceeding
or other proceeding pending or, to the knowledge of the Company,
threatened against the Company or any Subsidiary which questions
the validity of this Agreement or any of the other Transaction
Documents or any of the transactions contemplated hereby or thereby
or any action taken or to be taken pursuant hereto or thereto.
Except as set forth in the Commission Documents or on
Schedule 2.1(m) hereto, there is no action, suit,
claim, investigation, arbitration, alternate dispute resolution
proceeding or other proceeding pending or, to the knowledge of the
Company, threatened against or involving the Company, any
Subsidiary or any of their respective properties or assets, which
individually or in the aggregate, would reasonably be expected, if
adversely determined, to have a Material Adverse Effect. There
are
6
no outstanding
orders, judgments, injunctions, awards or decrees of any court,
arbitrator or governmental or regulatory body against the Company
or any Subsidiary or any officers or directors of the Company or
Subsidiary in their capacities as such, which individually or in
the aggregate, could reasonably be expected to have a Material
Adverse Effect.
(n)
Compliance with Law . The business of the Company and the
Subsidiaries has been and is presently being conducted in
accordance with all applicable federal, state and local
governmental laws, rules, regulations and ordinances, except such
that, individually or in the aggregate, the noncompliance therewith
could not reasonably be expected to have a Material Adverse Effect.
The Company and each of its Subsidiaries have all franchises,
permits, licenses, consents and other governmental or regulatory
authorizations and approvals necessary for the conduct of its
business as now being conducted by it unless the failure to possess
such franchises, permits, licenses, consents and other governmental
or regulatory authorizations and approvals, individually or in the
aggregate, could not reasonably be expected to have a Material
Adverse Effect.
(o)
Taxes . The Company and each of the Subsidiaries has
accurately prepared and filed all federal, state and other tax
returns required by law to be filed by it, has paid or made
provisions for the payment of all taxes shown to be due and all
additional assessments, and adequate provisions have been and are
reflected in the financial statements of the Company and the
Subsidiaries for all current taxes and other charges to which the
Company or any Subsidiary is subject and which are not currently
due and payable. Except as disclosed on Schedule 2.1(o)
hereto or in the Commission Documents, to the best of the
Company’s knowledge, none of the federal income tax returns
of the Company or any Subsidiary have been audited by the Internal
Revenue Service. The Company has no knowledge of any additional
assessments, adjustments or contingent tax liability (whether
federal or state) of any nature whatsoever, whether pending or
threatened against the Company or any Subsidiary for any period,
nor of any basis for any such assessment, adjustment or
contingency.
(p)
Certain Fees . Except as set forth on
Schedule 2.1(p) hereto, the Company has not employed
any broker or finder or incurred any liability for any brokerage or
investment banking fees, commissions, finders’ structuring
fees, financial advisory fees or other similar fees in connection
with the Transaction Documents.
(q)
Disclosure . Except for the transactions contemplated by
this Agreement, the Company confirms that neither it nor any other
person acting on its behalf has provided any of the Purchasers or
their agents or counsel with any information that constitutes or
might constitute material, nonpublic information. Neither this
Agreement or the Schedules hereto nor any other documents,
certificates or instruments furnished to the Purchasers by or on
behalf of the Company or any Subsidiary in connection with the
transactions contemplated by this Agreement contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements made herein or therein,
in the light of the circumstances under which they were made herein
or therein, not misleading.
(r)
Operation of Business . Except as set forth on
Schedule 2.1(r) hereto, the Company and each of the
Subsidiaries owns or possesses the rights to all patents,
trademarks, domain names (whether or not registered) and any
patentable improvements or copyrightable
7
derivative
works thereof, websites and intellectual property rights relating
thereto, service marks, trade names, copyrights, licenses and
authorizations which are necessary for the conduct of its business
as now conducted without any conflict with the rights of
others.
(s)
Environmental Compliance . The Company and each of its
Subsidiaries have obtained all material approvals, authorization,
certificates, consents, licenses, orders and permits or other
similar authorizations of all governmental authorities, or from any
other person, that are required under any Environmental Laws.
“Environmental Laws” shall mean all applicable laws
relating to the protection of the environment including, without
limitation, all requirements pertaining to reporting, licensing,
permitting, controlling, investigating or remediating emissions,
discharges, releases or threatened releases of hazardous
substances, chemical substances, pollutants, contaminants or toxic
substances, materials or wastes, whether solid, liquid or gaseous
in nature, into the air, surface water, groundwater or land, or
relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of hazardous
substances, chemical substances, pollutants, contaminants or toxic
substances, material or wastes, whether solid, liquid or gaseous in
nature. The Company has all necessary governmental approvals
required under all Environmental Laws as necessary for the
Company’s business or the business of any of its
subsidiaries. To the best of the Company’s knowledge, the
Company and each of its subsidiaries are also in compliance with
all other limitations, restrictions, conditions, standards,
requirements, schedules and timetables required or imposed under
all Environmental Laws. Except for such instances as would not
individually or in the aggregate have a Material Adverse Effect,
there are no past or present events, conditions, circumstances,
incidents, actions or omissions relating to or in any way affecting
the Company or its Subsidiaries that violate or may violate any
Environmental Law after the Closing Date or that may give rise to
any environmental liability, or otherwise form the basis of any
claim, action, demand, suit, proceeding, hearing, study or
investigation (i) under any Environmental Law, or
(ii) based on or related to the manufacture, processing,
distribution, use, treatment, storage (including without limitation
underground storage tanks), disposal, transport or handling, or the
emission, discharge, release or threatened release of any hazardous
substance.
(t)
Books and Records; Internal Accounting Controls . The
records and documents of the Company and its Subsidiaries
accurately reflect in all material respects the information
relating to the business of the Company and the Subsidiaries, the
location and collection of their assets, and the nature of all
transactions giving rise to the obligations or accounts receivable
of the Company or any Subsidiary. The Company is in material
compliance with all provisions of the Sarbanes-Oxley Act of 2002
which are applicable to it as of the Closing Date. The Company and
its subsidiary maintain a system of internal accounting controls
sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with
management’s general or specific authorizations,
(ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to
maintain asset accountability, (iii) access to assets is
permitted only in accordance with management’s general or
specific authorization, and (iv) the recorded accountability
for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences. The Company has established disclosure controls and
procedures (as defined in Exchange Act Rules 13B5(e) and
15d-15(e)) for the Company and designed such disclosure controls
and procedures to ensure that information required to be disclosed
by the Company in the reports it files or submits under the
Exchange Act is recorded, processed, summarized and
8
reported,
within the time periods specified in the Commission’s rules
and forms. The Company’s certifying officers have evaluated
the effectiveness of the Company’s disclosure controls and
procedures as of the end of the period covered by the
Company’s most recently filed periodic report under the
Exchange Act (such date, the “ Evaluation Date
”). The Company presented in its most recently filed periodic
report under the Exchange Act the conclusions of the certifying
officers about the effectiveness of the disclosure controls and
procedures based on their evaluations as of the Evaluation Date.
Since the Evaluation Date, there have been no changes in the
Company’s internal control over financial reporting (as such
term is defined in the Exchange Act) that has materially affected,
or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.
(u)
Material Agreements . Except as disclosed in the Commission
Documents or as set forth on Schedule 2.1(u) hereto, or
as would not be reasonably likely to have a Material Adverse
Effect, (i) the Company and each of its Subsidiaries have
performed all obligations required to be performed by them to date
under any written or oral contract, instrument, agreement,
commitment, obligation, plan or arrangement, filed or required to
be filed with the Commission (the “ Material
Agreements ”), (ii) neither the Company nor any of
its Subsidiaries has received any notice of default under any
Material Agreement and, (iii) to the best of the
Company’s knowledge, neither the Company nor any of its
Subsidiaries is in default under any Material Agreement now in
effect.
(v)
Transactions with Affiliates . Except as set forth on
Schedule 2.1(v) hereto or in the Commission Documents
or as contemplated by this Agreement, there are no loans, leases,
agreements, contracts, royalty agreements, management contracts or
arrangements or other continuing transactions between (a) the
Company, any Subsidiary or any of their respective customers or
suppliers on the one hand, and (b) on the other hand, any
officer, employee, consultant or director of the Company, or any of
its Subsidiaries, or any person owning at least five percent (5%)
of the outstanding capital stock of the Company or any Subsidiary
or any member of the immediate family of such officer, employee,
consultant, director or stockholder or any corporation or other
entity controlled by such officer, employee, consultant, director
or stockholder, or a member of the immediate family of such
officer, employee, consultant, director or stockholder which, in
each case, is required to be disclosed in the Commission Documents
or in the Company’s most recently filed definitive proxy
statement on Schedule 14A, that is not so disclosed in the
Commission Documents or in such proxy statement.
(w)
Securities Act of 1933 . The Company has complied and will
comply with all applicable federal and state securities laws in
connection with the offer, issuance and sale of the Securities
hereunder. Neither the Company nor anyone acting on its behalf,
directly or indirectly, has or will sell, offer to sell or solicit
offers to buy any of the Securities or similar securities to, or
solicit offers with respect thereto from, or enter into any
negotiations relating thereto with, any person, or has taken or
will take any action so as to bring the issuance and sale of any of
the Securities under the registration provisions of the Securities
Act and applicable state securities laws, and 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
Securities Act) in connection with the offer or sale of any of the
Securities.
9
(x)
Employees . Neither the Company nor any Subsidiary has any
collective bargaining arrangements or agree
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