Exhibit No.: 4.5
CRYOCON INC.
(Sellers)
SECURITIES PURCHASE AGREEMENT
PARAGON VENTURE FUND IV, LLC
(Buyer)
Dated as of April 15, 2000
Agreement by which Sellers issues Convertible Debentures to
PARAGON VENTURE FUND IV, LLC
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (the "Agreement") is made as of
April 15, 2000, by and among Cryocon Corporation, a Utah corporation (the
"Company"), with its principal office at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇,
▇▇▇▇▇, and Paragon Venture Fund IV, LLC or its assigns (the "Purchaser"), an
Illinois Limited Liability Company, with it's principal office at ▇▇▇ ▇. ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
The Company desires to issue to the Purchaser and the Purchaser desires
to purchase from the Company, upon the terms and subject to the conditions set
forth herein the convertible Debentures (as defined hereafter) of the Company.
In consideration of the mutual promises, representations, warranties,
covenants and conditions set forth in this Agreement, the parties hereto agree
as follows:
SECTION 1
AUTHORIZATION AND SALE OF CONVERTIBLE DEBENTURES
1.1 AUTHORIZATION. The Company has authorized the sale and issuance to
the Purchaser, on the terms and subject to the conditions of this Agreement, of
its Convertible Debentures in the aggregate principal amount of FOUR HUNDRED
SEVENTY-FIVE THOUSAND DOLLARS AND NO CENTS ($475,000.00), and containing the
terms and conditions and in the form of the Debenture set forth in Exhibit "A"
attached hereto (the "Debentures"). Capitalized terms not otherwise defined
herein shall have the meaning set forth in the debentures. The Debentures are
convertible into the Company's Common Stock as defined in Section 3.4 hereof.
1.2 SALE OF CONVERTIBLE DEBENTURES. At the Closing, on the terms and
subject to the conditions of this Agreement, the Company shall issue to the
Purchaser and the Purchaser will buy from the Company, Debentures in the
aggregate principal amount of FOUR HUNDRED SEVENTY-FIVE THOUSAND DOLLARS AND NO
CENTS ($475,000.00).
SECTION 2
CLOSING DATE; DELIVERY
2.1 CLOSING. The Closing of the purchase and sale of the convertible
debentures hereunder (the "Closing") shall be held not later than June 30, 2000,
or on such later date or dates as the Company and the Purchaser may agree to
(the date of such Closing being referred to as the "Closing Date"), at the
offices of Cryocon, Inc., ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, or such other
place as the Purchaser and the Company may mutually agree. The date of any
Closing of the transactions contemplated by this Agreement is sometimes also
referred to herein as the "Closing Date."
2.3 PAYMENT AND DELIVERY. At the Closing, the Company will deliver to
the Purchaser a Debenture in the aggregate principal amount of FOUR HUNDRED
SEVENTY-FIVE THOUSAND DOLLARS AND NO CENTS ($475,000.00), upon delivery of said
payment by the Purchaser, by check or wire transfer of funds immediately
available to the account designated by the Company.
SECTION 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Purchasers as follows:
3.1 ORGANIZATION AND STANDING; CERTIFICATE AND BYLAWS. The Company is a
corporation duly organized and existing under, and by virtue of, the laws of the
State of Utah and is in good standing under such laws. The Company has requisite
corporate power to own and operate its properties and assets, and to carry on
its business as presently conducted and as proposed to be conducted. The Company
is not qualified to do business as a foreign corporation in any jurisdiction and
such qualification is not presently required.
3.2 CORPORATE POWER. The Company will have at the Closing Date all
requisite corporate power to execute and deliver this Agreement, to sell and
issue the convertible debentures and the Common Stock (together, the "Conversion
Stock"), in accordance with the provisions of and the terms of this Agreement
and the Debenture.
3.3 SUBSIDIARIES. The Company has no subsidiaries or affiliated
companies and does not otherwise own or control, directly or indirectly, any
other corporation, association or business entity.
3.4 CAPITALIZATION. Cryocon's authorized Capital Stock consists of
20,000,000 shares of common stock, with no par value, of which 11,000,000 shares
have been issued and are outstanding (The "Common Stock"), and no shares of
Preferred Stock are authorized (collectively the "Capital Stock" or the
"Shares") validly issued, and are fully paid and nonassessable. Cryocon has sold
convertible promissory notes (the "Cryocon Notes") in the aggregate principal
amount of $50,000. The Cryocon Notes are convertible into shares of the common
stock of either Cryocon, any successor, Cryocon's parent company, or the
Company, after the Closing. Except as expressed in this section, Cryocon does
not have any other outstanding equity securities, options, warrants or similar
instruments, and is not a party to or bound by any agreement, instrument,
arrangement, contract, obligation, commitment or understanding of any character,
whether written or oral, express or implied, whereby Cryocon is bound to issue
shares of its Capital Stock or any instrument or right convertible into or
exchangeable for shares of its Capital Stock, nor relating to the sale,
assignment, encumbrance, conveyance, transfer or delivery of any Capital Stock
of Cryocon of any type or class. No person has preemptive or similar rights as
to the Cryocon Shares.
3.5 AUTHORIZATION. All corporate action on the part of the Company, its
directors and shareholders necessary for the authorization, execution, delivery
and performance of this Agreement and the Convertible Debentures by the Company,
the authorization, sale, issuance and delivery of the Shares and the Conversion
Stock and the performance of the Company's obligations hereunder has been taken
or will be taken prior to the Closing. This Agreement and the Debenture, when
executed and delivered by the Company, shall constitute the valid and binding
obligations of the Company enforceable in accordance with their respective terms
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium, and other laws of general application affecting enforcement of
creditors' rights generally, and (ii) as limited by laws relating to the
availability of specific performance, injunctive relief, and other equitable
remedies. The Shares, when issued in compliance with the provisions of this
Agreement, will be validly issued and will be fully paid and nonassessable; and
the Conversion Stock issuable upon conversion of the Debentures has been duly
and validly reserved and, when issued in compliance with the provisions of this
Agreement, will be validly issued and will be fully paid and nonassessable;
provided, however, that the Conversion Stock may be subject to restrictions on
transfer under state or federal securities laws and restrictions set forth
herein.
3.6 TITLE TO PROPERTIES AND ASSETS; LIENS. The Company has good and
valid title to its properties and assets, and has good title to all its
leasehold interests, in each case subject to no mortgage, pledge, lien, lease,
encumbrance or charge, other than possible minor liens and encumbrances which do
not in any case materially detract from the value of the property subject
thereto or materially impair the operations of the Company, and which have not
arisen otherwise than in the ordinary course of business.
3.7 TAX RETURNS AND PAYMENTS. The Company has timely filed all tax
returns and reports when and as required by law and has never been audited by
any state or federal taxing authority. All tax returns and reports of the
Company, if applicable, are true and correct in all material respects.
3.8 PATENTS AND TRADEMARKS. The Company owns or has the right, or prior
to the Closing will own or have the right, to use, free and clear of all,
charges, claims and restrictions, all patents, trademarks, service marks, trade
names, copyrights, licenses and rights necessary to its business as now
conducted (intellectual property rights), and is not, to the best of its
knowledge, infringing upon or otherwise acting adversely to the right or claimed
right of any person under or with respect to any of the foregoing. There are no
outstanding options, licenses, or agreements of any kind relating to the
foregoing, nor is the Company bound by or a party to any options, licenses or
agreements of any kind with respect to the patents, trademarks, service marks,
trade names, copyrights, trade secrets, licenses, information, proprietary
rights and processes of any other person or entity. The Company has not received
any written communications alleging that the Company has violated or, by
conducting its business as proposed, would violate any patent, trademark,
service ▇▇▇▇, trade name, copyright or trade secret or other proprietary right
of any other person or entity. The Company is not aware that any of its
employees is obligated under any contract (including licenses, covenants or
commitments of any nature) or other agreement, or subject to any judgment,
decree or order of any court or administrative agency, that would interfere with
the use of such employee's best efforts to promote the interests of the Company
or that would conflict with the Company's business as proposed to be conducted.
Neither the execution nor delivery of this Agreement, nor the carrying on of the
Company's business by the employees of the Company, nor the conduct of the
Company's business as proposed, will, to the Company's knowledge, conflict with
or result in a breach of the terms, conditions or provisions of, or constitute a
default under, any contract, covenant or instrument under which any of such
employees is now obligated.
3.9 MATERIAL CONTRACTS AND COMMITMENTS. Neither the Company, nor, to
the best knowledge of the Company, any third party is in default under any
material contract, agreement or instrument to which the Company is a party.
3.10 COMPLIANCE WITH OTHER INSTRUMENTS, NONE BURDENSOME. The Company is
not in violation of any terms of it's Amended Articles of Incorporation, Bylaws,
or in any material respect of any term or provision of any material mortgage,
indenture, contract, agreement or instrument to which it is a party or by which
it is bound, and to the best of its knowledge, is not in violation of any order,
statute, rule or regulation applicable to the Company, which violation
reasonably would be expected to have a material adverse effect on the Company's
business or financial condition. The execution, delivery and performance of and
compliance with this Agreement, and the issuance of the Debentures and the
Conversion Stock, have not resulted and will not result in any violation of, or
conflict with, or constitute a default under, or result in the creation of, any
material mortgage, pledge, lien, encumbrance or charge upon any of the
properties or assets of the Company.
3.11 LITIGATION. There are no actions, suits, proceedings or
investigations pending against the Company or its properties before any court or
governmental agency (nor, to the best of the Company's knowledge, is there any
written threat thereof), which, either in any case or in the aggregate,
reasonably would be expected to result in any material adverse change in the
business or financial condition of the Company or any of its properties or
assets, or in any material impairment of the right or ability of the Company to
carry on its business as now conducted, and none which questions the validity of
this Agreement or the Debenture or any action taken or to be taken in connection
herewith. The Company is not a party to, or to the best of its knowledge named
in any order, writ, injunction, judgment or decree of any court or government
agency or instrumentality. There is no action, suit or proceeding by the Company
currently pending or that the Company currently intends to initiate.
3.12 EMPLOYEES. To the best of the Company's knowledge, no employee of
the Company is in violation of any term of any employment contract, patent
disclosure agreement or any other contract or agreement relating to the
relationship of any such employee with the Company or any other party because of
the nature of the business conducted or to be conducted by the Company. The
Company does not have any collective bargaining agreements covering any of its
employees.
3.13 REGISTRATION RIGHTS. Except as set forth in the Debentures
provided the Purchaser and those provided earlier to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, the Company
is not currently under any obligation to register under the Securities Act of
1933, as amended (the "Act") any of its presently outstanding securities or any
of its securities which may hereafter be issued.
3.14 GOVERNMENTAL CONSENT. No consent, approval or authorization of, or
designation, declaration or filing with, any federal, state or local
governmental authority on the part of the Company is required in connection with
the valid execution and delivery of this Agreement and the Debentures, or the
offer, sale or issuance of the Conversion Stock, or the consummation of any
other transaction contemplated hereby, except qualification (or taking such
action as may be necessary to secure an exemption from qualification, if
available) of the offer and sale of the Conversion Stock under the Federal
Securities Laws and other applicable Blue Sky laws, which filing and
qualification, if required, will be accomplished in a timely manner prior to or
promptly upon completion of the Closing.
3.15 FEES. The Company has not incurred, and will not incur, directly
or indirectly, any liability for brokerage or finders' fees or agents'
commissions or any similar charges except legal, consulting and organizing
expenses in connection with this Agreement or any transaction contemplated
hereby.
3.16 DISCLOSURES. No representation, warranty or statement by the
Company in this Agreement, or in any written statement or certificate furnished
to the Purchasers pursuant to this Agreement, contains any untrue statement of a
material fact or, when taken together, omits to state a material fact necessary
to make the statements made herein, in light of the circumstances under which
they were made, not misleading. However, as to any projections furnished to the
Purchasers, such projections were prepared in good faith by the Company, but the
Company makes no representation or warranty that it will be able to achieve such
projections. The Company has fully provided Purchaser with all the information
that Purchaser requested for deciding whether to purchase the Securities.
3.17 PERMITS. The Company has all franchises, permits, licenses, and
any similar authority necessary for the conduct of its business as now being
conducted by it, the lack of which could materially and adversely affect the
business, properties or financial condition of the Company, and believes it can
obtain without undue burden or expense, any similar authority for the conduct of
its business as planned to be conducted. The Company is not in default in any
material respect under any of such franchises, permits, licenses or other
similar authority.
SECTION 4
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Purchaser hereby represents and warrants to the Company with respect to its
purchase of the Debentures as follows:
4.1 AUTHORIZATION. This Agreement and the Debenture, when executed and
delivered by the Purchaser, will constitute the Purchaser's valid and legally
binding obligation, enforceable in accordance with its terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium, and
other laws of general application affecting enforcement of creditors' rights
generally, and (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.
4.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made with the
Purchaser in reliance upon the Purchaser's representation to the Company, the
Purchaser hereby confirms, that the Debentures and the Conversion Shares
(collectively, the "Securities") will be acquired for investment for the
Purchaser's own account, not as a nominee or agent, and not with a view to the
resale or distribution of any part thereof, and that the Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing the same. By executing this Agreement, the Purchaser further
represents that the Purchaser does not have any contract, undertaking, agreement
or arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to any of the Securities. The
Purchaser represents that it has the full power and authority to enter into this
Agreement.
4.3 INVESTMENT EXPERIENCE. The Purchaser is a Purchaser in securities
of companies in the development stage and acknowledges that it is able to fend
for itself, can bear the economic risk of its investment, and has such knowledge
and experience in financial or business matters that it is capable of evaluating
the merits and risks of the investment in the Debentures and the Conversion
Stock. If other than an individual, the Purchaser also represents it has not
been organized solely for the purpose of acquiring the Debentures or Conversion
Shares.
4.4 ACCREDITED PURCHASER. The Purchaser is an "accredited investor"
within the meaning of Securities and Exchange Commission ("SEC") Rule 501 of
Regulation D, as presently in effect.
4.5 `NO PUBLIC MARKET. Purchaser understands that no public market now
exists for any of the securities issued by the Company and that it is unlikely
that a public market will ever exist for the Debentures or Conversion Shares.
4.6 RECEIPT OF INFORMATION. Purchaser received and reviewed this
Agreement and all Exhibits thereto; it, its attorney and its accountant have had
access to, and had an opportunity to review all documents and other materials
requested from the Company; The Purchaser and they have been given an
opportunity to ask any and all questions of, and receive answers from, the
Company concerning the terms and conditions of the offering and to obtain all
information it or they believe necessary or appropriate to evaluate the
suitability of an investment in the Debentures and the Conversion Shares. The
Purchaser did not rely upon any representations or other information (whether
oral or written) other than as set forth in the documents and answers referred
to above.
4.7 RESTRICTED SECURITIES. The Purchaser understands that the
Securities it is purchasing 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 not be resold without registration
under the Act only in certain limited circumstances. In addition, the Purchaser
represents that it is familiar with Rule 144 promulgated under the Act, as
presently in effect, and understands the resale limitations imposed thereby and
by the Act.
4.8 FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting the
representations set forth above, the Purchaser further agrees not to make any
disposition of all or any portion of the Securities unless:
(a) The Securities and Conversion Shares are transferred (i) pursuant
to a current registration statement and prospectus under the Securities Act,
(ii) pursuant to Rule 144 of the SEC (or any similar rule then in force), (iii)
to an Affiliate or member of the family of the transferor (provided that the
subsequent transfer of the Debentures and Conversion Securities is restricted)
or (iv) subject to the conditions set forth in Section 4.8 (b), any other
legally available means of transfer; and,
(b) In connection with any transfer of any Debentures and Conversion
Shares (other than a transfer described in Section 4.8 (a) (i), (ii) and (iii)),
the Purchaser has notified the Company of the proposed disposition and furnished
the Company with a statement of the circumstances surrounding the proposed
disposition, and if requested by the Company, the Purchaser shall furnish the
Company written opinion of a legal counsel, who is to the Company's reasonable
satisfaction, knowledge in securities law matters; and,
(c) The Purchaser shall have sold, assigned, transferred, pledged or
otherwise disposed of the Securities in a transaction involving the distribution
without consideration of the Securities by the Purchaser to any of it's members
involving the transfer or distribution of the Securities by a corporation to any
subsidiary, parent or affiliated corporation of such corporation; provided in
each case that the Purchaser shall give written notice to the Company of such
Purchaser's intention to effect such transfer, sale, assignment, pledge or other
disposition. The Purchaser will cause any such proposed purchaser, assignee,
transferee or pledgee of any Securities held by the Purchaser to agree to take
and hold such Securities subject to the provisions and upon the conditions
specified in this Agreement.
4.9 LEGENDS. It is understood that the certificates evidencing the
Securities may bear one or all of the following legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A
REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE
SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A OF
SUCH ACT."
(b) Any legend required by the laws of the State of Utah or the
State of Illinois.
SECTION 5
CONDITIONS TO CLOSING OF COMPANY
The Purchasers' obligations to purchase any Securities hereunder is
subject to the satisfaction of each of the following conditions precedent:
5.1 CONTRAVENE ANY LAW. The issuance and sale of the Securities shall
not contravene any law, rule or regulation applicable to, or result in any
liability or obligation for, the Purchaser or the Company.
5.2 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made, and shall be true and correct in all material
respects on the Closing Date, with the same force and effect as if they had been
made on and as of said date.
5.3 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date,
shall have been performed or complied with in all material respects.
5.4 BLUE SKY. The Company shall have obtained all necessary Blue Sky
Law permits and qualification required by any state for the offer and sale of
the Debentures and the Conversion Stock, unless there is an applicable
exemption.
5.5 NO LAWSUITS. No actions, suit, investigation or proceedings shall
be pending or threatened before any court or Governmental Agency to restrain,
prohibit, and collect damages as a result of or otherwise challenge this
Agreement or any related document or any transaction contemplated hereby or
thereby;
5.6 ALL ACTS COMPLETE. All acts or covenants required hereunder to be
performed by the Company prior to the Closing shall have been fully performed by
the Company.
5.7 The following documents and items shall be delivered to the
Purchaser at or prior to the Closing:
(j) A fully executed counterpart of this Agreement, and fully
executed Debenture.
(k) Certificates of a duly authorized officer of the Company dated
as of the Closing Date:
(i) Stating that the following conditions have been satisfied
as of the Closing Date
1) The representations and warranties of the Company
contained herein and in any writing delivered
pursuant hereto were true and correct when made and
are materially true and correct as of the time of
the Closing;
2) No actions, suit, investigation or proceedings
shall be pending or threatened before any court or
Governmental Agency to restrain, prohibit, collect
damages as a result of or otherwise challenge this
Agreement or any related document or any transaction
contemplated hereby or thereby; and
3) All covenants, agreements and conditions
contained in this Agreement to be performed by the
Company on or prior to the Closing Date, shall have
been performed or complied with in all material
respects.
(ii) Setting forth the resolutions of the Board of Directors
authorizing the execution and delivery of this Agreement and
the Related Documents and the consummation of the transactions
contemplated hereby and thereby, and certifying that such
transactions contemplated hereby and thereby, and certifying
that such were duly adopted and have not been rescinded or
amended;
SECTION 6
CONDITIONS TO CLOSING OF PURCHASERS
6.1 Closing Deliveries to the Company. The Purchaser will deliver to
the Company the aggregate purchase price of the Securities to be acquired by the
Purchaser.
SECTION 7
COVENANTS OF THE COMPANY
7.1 RESTRICTED ACTIONS. Without the prior written consent of the
Purchaser, and for so long as any of the Debentures remain outstanding, the
Company shall not:
(g) Become subject to any agreement or instrument, which by its
terms would (under any circumstances), restrict or impair the
Company's right to comply with or fulfill its obligations
under the terms of this Agreement of the Convertible
debentures or of the related document;
(h) Materially alter or change the business of the Company; and
(l) Alter the rights, preferences and privileges of the Securities
or Debentures.
7.2 REQUIRED ACTIONS. For so long as any of the Debentures remain
outstanding, the Company shall;
(a) Cause all properties owned by the Company or any of its
Subsidiaries or used or held for use in the conduct of its business to
be maintained and kept in good condition, repair and working order
(reasonable wear and tear excepted) and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the
judgment of the Board of Directors may be necessary so that the
business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that the
foregoing shall not prevent the Company from discontinuing the
maintenance or operation of any of such properties if such
discontinuance is, in the judgment of the Company's management,
desirable in the conduct of its business of any of its Subsidiaries and
is not disadvantageous in any material respect to the holders of the
Securities;
(b) Preserve and keep in full force and effect the corporate
existence, rights, licenses and franchises of the Company, provided,
however, that the Company shall not be required to preserve any such
right, license or franchise if the Board of Directors shall determine
that the preservation thereof is no longer desirable in the conduct of
the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the holders of Securities;
(c) Maintain the books, accounts and records of the Company,
in accordance with past custom and practice as used in the preparation
of the Financial Statements except to the extent permitted or required
by GAAP.
(d) Keep all of its properties which are of an insurable
nature insured with insurers, believed by the Company in good faith to
be financially sound responsible, against loss or damage to the extent
that property of similar character is usually so insured by
corporations similarly situated and owning like properties (which may
include self-insurance, if reasonable and in comparable form to that
maintained by companies similarly situated.);
(e) Comply with all material legal requirements and material
contractual obligations applicable to the operations and business of
the Company and pay all applicable taxes as they become due and
payable;
(f) Permit representatives of the Holder of the Debenture and
its agents (including their counsel, accountants and consultants),
subject to the execution of a reasonable confidentiality agreement, to
have reasonable access upon reasonable notice during business hours to
the Company's books, records, facilities, key personnel, officers,
directors, customers, independent accountants and legal counsel so long
as such access does not violate any applicable Federal or state law or
cause the loss of the attorney-client privilege;
(g) Maintain all material Intellectual Property Rights
necessary to the conduct of its business and own or have a valid
license to use all right, title and interest in and to, such material
Intellectual Property Rights;
(h) Deliver Conversion Shares in accordance with the terms and
conditions, and time period, set forth in the Debentures; and
(i) Take such actions and execute, acknowledge and deliver, at
Company's sole cost and expense such agreements, instruments or other
documents as the Purchaser may reasonably require from time to time in
order to (i) carry out more effectively the purposes of this Agreement
and the related documents, (ii) maintain the validity and effectiveness
of any of the related documents, and (iii) to better assure, convey,
grant, assign, transfer and confirm unto the Purchaser the rights now
or hereafter intended to be granted to the Purchaser under this
Agreement or any related document.
SECTION 8
REGISTRATION RIGHTS
8.1 REGISTRATION RIGHTS. The Company, at its sole cost and expense,
covenants to register or qualify or cause to be registered or qualified by one
or more registrations or qualifications under applicable federal and state
securities laws the sale and resale by the Purchaser of all the Conversion
Shares and all of the additional shares of Common Stock issued or issuable to
the Purchaser pursuant to this Debenture, if any, (the "Registrable
Securities"), and to maintain such registrations or qualifications effective for
all periods during which any portion of any Debenture may be converted. The
Company covenants to use its best efforts to cause such registrations or
qualifications to become effective as soon after filing as possible and to
remain effective for all periods during which any portion of any Debenture may
be converted. The Company covenants to prepare and file with the Securities and
Exchange Commission such amendments and supplements to such registrations or
qualification and the prospectus used in connection therewith as may be
necessary to keep such registrations or qualifications effective and to comply
with the provisions of the Securities Act of 1933, as amended, respect to the
disposition of all securities covered by such registration or qualification in
accordance with the intended methods of disposition by the Purchaser thereof set
forth in such registration or qualification.
8.2 Piggyback Registration. If Company, at any time or times proposes
or is required to register any of its Capital Stock or other equity securities
for public sale for cash under the Securities Act (other than on Forms S-4 or
S-8 or successor forms thereto or any form on which the Registrable Securities
are not eligible to be registered), and any applicable state securities law, it
will at each such time or times give written notice to the Purchaser of its
intention to do so. Upon the written request of Purchaser given within fifteen
(15) days after receipt of any such notice, Company shall use its best efforts
to cause the registration of Purchaser's conversion shares pursuant to the
Securities Act and any applicable state securities laws; provided, that if the
Piggyback Registration involves a public offering and the underwriters thereof
advise Company in writing that in their opinion the Conversion Shares proposed
to be registered in such Piggyback Registration should be offered for sale so as
not to materially and adversely affect the price or salability of the stock
being registered by Company, then the Purchasers proposing to include conversion
shares in the registration statement, other than pursuant to the exercise of
demand rights or piggyback rights, shall reduce on a pro rata basis the number
of Conversion Shares to be included in the registration statement.
SECTION 9
MISCELLANEOUS
9.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of Utah, without giving effect to the conflicts of laws
principles thereof.
9.2 CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE. Any legal
action or proceeding with respect to this Agreement or any related document may
brought in the courts of Utah in the County of ▇▇▇▇▇, or in the United States
District Court for the Northern District of Utah, and, by execution and delivery
of this Agreement, the parties hereby irrevocably accept in respect of their
property, generally and unconditionally, the jurisdiction of the aforesaid
courts.
9.3 SURVIVAL. The representations, warranties, covenants, and
agreements made herein shall survive any investigation made by any Purchaser and
the closing of the transactions contemplated hereby.
9.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement and the other documents
delivered pursuant hereto constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and thereof,
and supersede all prior oral or written arrangements or understandings.
9.5 HEADINGS. The headings of the various sections of this Agreement
have been inserted for reference only and shall not be deemed to be a part of
this Agreement.
9.6 AMENDMENT AND WAIVER. No amendment of any provision of this
Agreement shall be effective, unless the same shall be in writing and signed by
the Company and the Purchaser. Any failure of the Company to comply with any
provision hereof may only be waived in writing by the Purchaser, and any failure
of the Purchaser of the Securities, or the Conversion Shares to comply with any
provision hereof may only be waived in writing by the Company. No such waiver
shall operate as a waiver of, or estoppel with respect to, any subsequent or
failure. No failure by any party to take any action against any action against
any breach of this Agreement or default by any other party shall constitute a
waiver of such party's right to enforce any provision hereof or to take any such
action.
9.7 SEVERABILITY. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided that no such severability shall be effective if
it materially changes the economic benefit of this Agreement to any party.
9.8 SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure to the
benefit of the parties hereto and their respective successors and assigns,
including each subsequent holder of Securities or Conversion Shares. Except, as
otherwise specifically provided herein, this Agreement shall not be assignable
by the Company without the prior written consent of the Purchaser.
9.9 NO THIRD PARTY BENEFICIARIES. Except as specifically set forth or
referred to herein, nothing herein is intended or shall be construed to confer
upon any person or entity other than the parties hereto and their successors or
assigns, any rights or remedies under or by reason of this Agreement.
9.10 NOTICES. All notices and other communications required or
permitted hereunder shall be in writing and shall be (i) delivered in person,
(ii) transmitted by fax (iii) sent by registered or certified mail, postage
prepaid with return receipt requested, or (iv) sent by reputable overnight
courier service, fees prepaid, to the recipient at the address or telephone
number set forth below, or such other address or fax number as may hereafter be
designated in writing by such recipient. Notices shall be deemed given upon
personal delivery, upon receipt of return receipt in the case of delivery by
mail, upon acknowledgment by the receiving fax or one day following deposition
with an overnight courier service.
(d) To the Company: CRYOCON, INC.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(b) To the Purchaser: PARAGON VENTURE FUND IV, LLC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
9.11 REMEDIES CUMULATIVE. Except as otherwise provided herein, the
remedies provided herein shall be cumulative and shall not preclude the
assertion by any party hereto of any other rights or the seeking of any other
remedies against any other party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers or agents as of the day and year first above
written.
COMPANY:
CRYOCON, INC.
By: /s/
---------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
President
PURCHASER:
PARAGON VENTURE FUND IV, LLC
By: /s/
---------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, Manager
THE SECURITIES REPRESENTED BY THIS CONVERTIBLE DEBENTURE WERE ORIGINALLY ISSUED
ON APRIL 15, 2000 AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED OR ANY APPLICABLE STATE SECURITIES LAW. THE SALE OF THE COMPANY'S
SECURITIES IS BEING MADE PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED IN
SECTION 4 (2) OF THE SECURITIES ACT OF 1933, AS AMENDED, AND REGULATION D, RULE
506. THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS SUBORDINATED CONVERTIBLE
DEBENTURE IS SUBJECT TO THE CONDITIONS SET FORTH IN THE SECURITIES PURCHASE
AGREEMENT, DATED APRIL 15, 2000, BETWEEN THE ISSUER AND THE PURCHASER NAMED
THEREIN. THE ISSUER RESERVES THE RIGHT TO REFUSE ANY TRANSFER OF SUCH SECURITIES
UNTIL SUCH CONDITIONS HAVE BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER.
CRYOCON, INC.
(A Utah Corporation)
10% Convertible Promissory Debenture Due February 1, 2003
Registered Owner: PARAGON VENTURE FUND IV, LLC
Principal Amount: $475,000.00
Issue Date: April 15, 2000
16. CONVERTIBLE DEBENTURE (the "Debenture") dated as of April 15,
2000, by and between Cryocon, Inc. (the "Company"), a Utah
corporation with an address at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇
▇▇▇▇▇; and Paragon Venture Fund IV, LLC, an Illinois Limited
Liability Company or his assigns (the "Holder"), with an
address at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇.
17. This Debenture is issued pursuant to a Securities Purchase
Agreement, dated as of April 15, 2000 (the "Purchase
Agreement"), by and between Company and Holder. The Purchase
Agreement contains terms governing the sale of Assets to the
Company, and all provision of the Purchase Agreement is hereby
incorporated herein in full by reference. Except as otherwise
indicated herein, capitalized terms used in this Debenture
have the same meanings set forth in the Purchase Agreement.
18. The Debenture shall be converted immediately into shares of
common stock of the Company following the closing of the
merger transaction between the Company and ISO Block USA, A
Colorado Corporation. Said stock shall be issued in such sums
and amounts as has been received of the Principal Amount in
accordance with the terms of Conversion provided in Section 4
of this Agreement.
19. REDEMPTION:
(a) Redemption. If at any time after the Issue of this Debenture, an
Event of Default occurs, the Company shall redeem at the option of the
Holder of this Debenture, the outstanding principal amount of this
Debenture. The "Redemption Price" is the total unpaid principal amount
at the Redemption Date.
(b) Notice of Redemption. The Holder may submit written notice of
redemption, pursuant to paragraph (a) above, to the Company not less
than (10) ten days prior to the date specified in the notice on which
such redemption is to be made (the "Redemption Date"). In the case less
than all the aggregate principal amount of the Debenture is redeemed, a
new Debenture representing the aggregate principal amount of the
unredeemed Debenture shall be issued to the Holder thereof without cost
to such Holder within two (2) business days after the surrender of this
Debenture.
(c) Redemption Payments. For each Debenture or portion thereof which is
to be redeemed hereunder, the Company shall be obligated on the
applicable Redemption Date to pay to the Holder thereof (upon surrender
by such Holder at the Company's principal office of the Debenture) the
Redemption Price in cash or in immediately available funds. If the
Company does not make the payment when due, interest will accrue on all
outstanding Debentures from and after the Redemption Date at the
Default Rate, the Conversion Price calculated pursuant to Section 4 in
connection with any subsequent conversion of this Debenture will be
reduced to $1.50 per share, and this Debenture shall be immediately
convertible notwithstanding any other restrictions on conversion.
(d) Interest After Redemption Date. If the Redemption Price of such
Debenture is paid in full to the Holder of the Debenture on the
Redemption Date, this Debenture shall not be entitled to any interest
accruing after such date and on such date, all rights of the Holder of
the Debenture shall cease, and the Debenture shall no longer be deemed
to be issued and outstanding.
20. Conversion. Subject to and upon compliance with the provisions of
the Debentures, at the option of the Holder thereof, the Debentures or
any portion thereof and any accrued and unpaid interest thereon may be
converted into fully paid and nonassessable shares (calculated as to
the nearest number of whole shares) of the Company's Common Stock at
the Conversion Price as defined herein (the "Conversion Shares"). The
"Conversion Price" is $2.00 per share. The total number of shares of
Common Stock into which Debenture may be converted will be determined
by dividing the unpaid principal amount, plus accrued and unpaid
interest thereon by the Conversion Price. No fractional shares will be
issued upon conversion. The Conversion right expires when all of the
Debentures have been paid in full, including accrued interest and costs
of collection.
In the case of any Debenture which is surrendered for conversion,
accrued and unpaid interest will be payable on such Debenture with respect to
the period ending on conversion date.
Upon the occurrence of an Event of Default, all of the Debentures shall
be immediately convertible notwithstanding any timing restrictions imposed
herein.
A. Exercise of Conversion Right. To exercise the conversion right, the
Holder of the Debenture shall surrender to the Company such Debentures, duly
endorsed, accompanied by written Notice of Conversion to the Company in the form
provided in this Debenture that the Holder elects to convert such Debenture, or
if less than the entire principal amount thereof is to be converted, the
specified portion.
Debentures shall be deemed to have been converted immediately prior to
the close of business on the day of surrender of such Debentures for conversion
in accordance with the foregoing provisions, and at such time the rights of the
Holders of such Debentures as Holders shall cease, and the person or persons
entitled to receive the Common Stock issuable upon conversion shall be treated
for all purposes as the record holder or holders of such Common Stock as and
after such time.
Within two days after the conversion date, the Company, without cost to
the Holder, shall issue and deliver to Holder the converted Debenture or the
person, specified by such Holder, a certificate for the number of full shares of
Common Stock issuable upon conversion registered in the name of such Holder or
such other person as shall have been specified by such Holder and all accrued
and unpaid interest on the converted Debenture or portion there upon which the
Holder does not elect to receive payment in Common Stock.
Upon Conversion of this Debenture, the Company shall take all such
actions as are necessary in order to insure that the Common Stock issuable with
respect to such conversion shall be validly issued, fully paid and
nonassessable.
The Company shall not close its books against the transfer of Common
Stock issued or issuable upon conversion of this Debenture in any manner that
interferes with the timely conversion of this Debenture. The Company shall
assist and cooperate with any Holder of this Debenture required to make any
governmental filings or obtain any governmental approval prior to or in
connection with the conversion of this Debenture (including, without limitation,
making any filings required to be made by the Company).
The conversion rights of any Debenture subject to redemption hereunder
shall terminate on the Redemption Date for such Debenture unless the Company has
failed to pay to Holder thereof the Redemption Price of such Debenture or
portion thereof.
B. Consolidation of Company. In the case of any consolidation or merger
of the Company with or into another corporation (other than a consolidation or
merger in which the Company is the surviving corporation and which does not
result in any reclassification or change of outstanding shares of the class
issuable upon conversion of the Debentures), or in case of any sale or transfer
to another corporation of the property of the Company as an entirety or
substantially as an entirety, the Holder of each Debenture, then outstanding
shall have the right to exercise such Debenture for the purchase of the kind and
amount of shares of Common Stock and other securities and property receivable
upon such consolidation, merger, sale, or transfer by a holder of the number of
shares of Common Stock which would have been issuable if the conversion of the
Debentures had occurred immediately prior to such consolidation, merger, sale or
transfer.
5. Registration Rights. The Company, at its sole cost and expense, covenants to
register or qualify or cause to be registered or qualified by one or more
registrations or qualifications under applicable federal and state securities
laws the sale and resale by the Holder of all the Conversion Shares and all of
the additional shares of Common Stock issued or issuable to the Holder pursuant
to this Debenture, if any, (the "Registrable Securities"), and to maintain such
registrations or qualifications effective for all periods during which any
portion of any Debenture may be converted. The Company covenants to use its best
efforts to cause such registrations or qualifications to become effective as
soon after filing as possible and to remain effective for all periods during
which any portion of any Debenture may be converted. The Company covenants to
prepare and file with the Securities and Exchange Commission such amendments and
supplements to such registrations or qualification and the prospectus used in
connection therewith as may be necessary to keep such registrations or
qualifications effective and to comply with the provisions of the Securities Act
of 1933, as amended, respect to the disposition of all securities covered by
such registration or qualification in accordance with the intended methods of
disposition by the Holder thereof set forth in such registration or
qualification.
6. Piggyback Registration. If Company, at any time or times proposes or is
required to register any of its Common Stock or other equity securities for
public sale for cash under the Securities Act (other than on Forms S-4 or S-8 or
successor forms thereto or any form on which the Registrable Securities are not
eligible to be registered), and any applicable state securities law, it will at
each such time or times give written notice to the Holder of its intention to do
so. Upon the written request of Holder given within fifteen (15) days after
receipt of any such notice, Company shall use its best efforts to cause the
registration of Holder's conversion shares pursuant to the Securities Act and
any applicable state securities laws; provided, that if the Piggyback
Registration involves a public offering and the underwriters thereof advise
Company in writing that in their opinion the Conversion Shares proposed to be
registered in such Piggyback Registration should be offered for sale so as not
to materially and adversely affect the price or salability of the stock being
registered by Company, then the Holders proposing to include conversion shares
in the registration statement, other than pursuant to the exercise of demand
rights or piggyback rights, shall reduce on a pro rata basis the number of
Conversion Shares to be included in the registration statement.
7. Holder's Investment Representation. Holder understands that the purchase and
sale of the subject Debentures have not been registered under the Securities Act
or applicable state securities laws on the basis that the purchase and sale of
the Dentures are exempt from such registration under the Securities Act and
Securities Laws based in part upon the representations made herein. Holder,
thereby, represents that he does not intend to resell or otherwise dispose of
the shares being purchased and sold hereby. Holder, further represents that he
is acquiring the Debentures for investment purposes only and for his own
account, not on behalf of others, and not with a view to resell or otherwise to
distribute the purchased shares, and the Holder will not sell or otherwise
distribute the purchased shares without registration under the Securities Act
and applicable Securities Laws or pursuant to applicable exceptions therefrom.
The Holder represents that he will not attempt to sell or otherwise
distribute his Debentures, except in compliance with the anti-fraud,
registration and any of the material provisions of the Securities Act and
applicable Securities Law.
A legend will be placed on the certificate evidencing the Debenture to
the effect that such shares have not been registered under the Securities Act or
applicable Securities Laws and that the Purchased Shares may not be resold
unless they are registered under the Securities Act and Securities Laws or
pursuant to applicable exemptions therefrom.
8. Representations, Warranties and Covenants. The Company hereby represents,
warrants and covenants as follows:
A. Reservation of Common Stock. The Company shall at all times reserve
and keep available, free from preemptive rights, out of its authorized but
unissued Common Stock or out of the Common Stock held in treasury, the full
number of shares of Common Stock as shall from time to time be issuable upon the
conversion of all issued and outstanding Debentures.
B. Covenant as to Common Stock. The Company covenants that all shares
of Common Stock which may be issued upon conversion of Debentures, including
interest, additional shares of Common Stock and penalties, will upon issue be
fully paid and nonassessable and the Company will pay all taxes, liens and
charges that may be payable in respect of the issue or delivery of shares of
Common Stock on conversion of Debentures pursuant hereto.
C. Payment of Debentures. The Company shall pay the principal of, and
interest on, the Debentures on the dates and in the manner provided herein and
in the Debentures.
D. Continued Existence. The Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence as
a corporation and will refrain from taking any action that would cause its
existence as a corporation to cease, including without limitation any action
that would result in the liquidation, winding up or dissolution of the Company.
E. Further Assurances. From time to time the Company will make, execute
and deliver to the Holder, or cause to be made, executed and delivered to the
Holder, any and all such further and other instruments and assurances as may be
reasonably necessary or proper to carry out the intention of, or to facilitate
the performance of, the terms of this Debenture or to secure the rights and
remedies hereunder of Holders.
F. Restricted Payments. The Company shall not declare and pay any
dividends on its Capital Stock or redeem, acquire or otherwise retire for value
any securities issued by it (other than the Debentures) unless, at the time of
the taking of such action, no Event of Default or event which with notice or
lapse of time or both would become an Event of Default has occurred and is
continuing.
G. Successors. The Company shall not, whether in a single transaction
or through a series of related transactions, consolidate or merge with or into,
or sell, lease, convey or otherwise dispose of all or substantially all of its
assets to, any person unless such person agrees in writing to assume all
obligations of the Company under the Debentures.
H. Authorization. The Company has full authority to make and perform
its obligations under the Debentures, and the Debentures when executed and
delivered by the Company were or will be the legal, valid and binding
obligations of the Company, enforceable in accordance with their respective
terms.
I. Litigation. There is no claim, litigation or governmental
proceedings against the Company now pending or, to the knowledge of the Company,
threatened, which is substantial in amount or which, if adversely determined
would have a material adverse effect on the financial condition of the Company
or the ability of the Company to perform its obligations under the Debentures.
9. Defaults and Remedies.
---------------------
D. Events of Default. An "Event of Default" shall occur if:
(i) The Company defaults in the payment of principal or
interest on any Debenture when the same becomes due or
payable, whether at maturity or upon acceleration or
redemption or otherwise;
(ii) The Company fails to perform or observe any material
provision contained in this Debenture, the Purchase Agreement
or related documents.
(iii) Any representation or warranty contained in the Purchase
Agreement or required to be furnished to any holder of
Debentures pursuant to the Purchase Agreement, or any
information contained in writing required to be furnished by
the Company to any holder of the Debentures, is false or
misleading in any material respect on the date made or
furnished;
(iv) The Company pursuant to or within the meaning of any
Bankruptcy Law becomes a party to any bankruptcy or insolvency
proceedings and such proceeding is not dismissed within thirty
(30) days; and
(v) Any material provision of the Purchase Agreement, the
Debentures or any related document shall at any time for any
reason be declared to be null and void, or the validity or
enforceability thereof shall be contested by any party
thereto, or a proceeding shall be commenced by the Company
seeking to establish the invalidity or enforceability thereof,
or the Company shall deny in writing that it has any liability
or obligation purported to be created under the Purchase
Agreement or any related document;
B. Notice of Company's Default. Holder shall give written notice to
Company of any Event of Default, which notice shall specify: (a) the nature of
the act, omission, or deficiency giving rise to the Event of Default, (b) the
action required to cure the default, if an action to cure is possible, and (c) a
date, which shall not be less than 30 calendar days from the mailing of the
notice, by which such action to cure must be taken, if any action to cure is
possible.
C. Lender's Remedies. Upon the happening of an Event of Default, after
notice to Company of the Event of Default, as set forth above, and, if an action
to cure is specified in the notice, Company's failure to cure the deficiency
with the time specified in the notice, Holder may, in addition to other rights
and remedies permitted by law, proceed with any and all of the following
remedies in any order or combination Holder may choose in its sole discretion:
(i) Terminate this Agreement, in which case the Holder may
declare the entire principal amount of the Debenture
outstanding and all accrued interest immediately due and
payable and demand, at the Holder's election, that the Company
convert the Debenture pursuant to paragraph 4; or
(ii) Bring an action for equitable relief (1) seeking the
specific performance by Company of the terms and conditions of
the Debenture, Purchase Agreement, or related documents,
and/or enjoining, abating, or preventing any violation of said
terms and conditions, and./or (3) seeking declaratory relief.
D. Enforcement. The Company shall reimburse or pay, on demand, to or on
behalf of the Holder the costs and expenses, including reasonable fees and
expenses of counsel(s) to the Holder, incurred by the Holder in connection with
the enforcement, whether with or without suit, of this Debenture, the Purchase
Agreement and any of the related documents if the Holder substantially prevails
in it's action.
10. Miscellaneous.
-------------
10.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of Utah, without giving effect to the conflicts of laws
principles thereof.
10.2 CONSENT JURISDICTION; SERVICE OF PROCESS AND VENUE. Any legal
action or proceeding with respect to this Agreement or any related document may
brought in the courts of Utah in the County of ▇▇▇▇▇, or in the United States
District Court for the Northern District of Utah, and, by execution and delivery
of this Agreement, the parties hereby irrevocably accept in respect of their
property, generally and unconditionally, the jurisdiction of the aforesaid
courts.
10.3 SURVIVAL. The representations, warranties, covenants, and
agreements made herein shall survive any investigation made by any Purchaser and
the closing of the transactions contemplated hereby.
10.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement and the other
documents delivered pursuant hereto constitute the full and entire understanding
and agreement between the parties with regard to the subjects hereof and
thereof, and supersede all prior oral or written arrangements or understandings.
10.5 HEADINGS. The headings of the various sections of this Agreement
have been inserted for reference only and shall not be deemed to be a part of
this Agreement.
10.6 AMENDMENT AND WAIVER. No amendment of any provision of this
Agreement shall be effective, unless the same shall be in writing and signed by
the Company and the Purchaser. Any failure of the Company to comply with any
provision hereof may only be waived in writing by the Purchaser, and any failure
of the Purchaser of the Securities, or the Conversion Shares to comply with any
provision hereof may only be waived in writing by the Company. No such waiver
shall operate as a waiver of, or estoppel with respect to, any subsequent or
failure. No failure by any party to take any action against any action against
any breach of this Agreement or default by any other party shall constitute a
waiver of such party's right to enforce any provision hereof or to take any such
action.
10.7 SEVERABILITY. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided that no such severability shall be effective if
it materially changes the economic benefit of this Agreement to any party.
10.8 SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure to the
benefit of the parties hereto and there respective successors and assigns,
including each subsequent holder of Securities or Conversion Shares. Except, as
otherwise specifically provided herein, this Agreement shall not be assignable
by the Company without the prior written consent of the Purchaser.
10.9 NO THIRD PARTY BENEFICIARIES. Except as specifically set forth or
referred to herein, nothing herein is intended or shall be construed to confer
upon any person or entity other than the parties hereto and their successors or
assigns, any rights or remedies under or by reason of this Agreement.
10.10 NOTICES. All notices and other communications required or
permitted hereunder shall be in writing and shall be (i) delivered in person,
(ii) transmitted by fax (iii) sent by registered or certified mail, postage
prepaid with return receipt requested, or (iv) sent by reputable overnight
courier service, fees prepaid, to the recipient at the address or telephone
number set forth below, or such other address or fax number as may hereafter be
designated in writing by such recipient. Notices shall be deemed given upon
personal delivery, upon receipt of return receipt in the case of delivery by
mail, upon acknowledgment by the receiving fax or one day following deposition
with an overnight courier service.
(d) To the Company: CRYOCON, INC.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
(b) To the Purchaser: PARAGON VENTURE FUND IV, LLC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
10.11 REMEDIES CUMULATIVE. Except as otherwise provided herein, the
remedies provided herein shall be cumulative and shall not preclude the
assertion by any party hereto of any other rights or the seeking of any other
remedies against any other party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers or agents as of the day and year first above
written.
COMPANY:
CRYOCON, INC.
By: /s/
---------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
President
PURCHASER:
PARAGON VENTURE FUND IV, LLC
By: /s/
---------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, Manager
NOTICE OF CONVERSION
To: Cryocon, Inc.
The undersigned registered owner of this Debenture hereby exercises the
option to convert this Debenture, or the portion hereof designated below, and
the accrued interest thereon designated below into shares of Common Stock in
accordance with the terms of the Debenture, and directs that the shares issuable
and deliverable upon the conversion, together a new Debenture representing any
unconverted principal amount hereof, be issued and delivered the registered
owner hereof, unless a different name has been provided below.
Principal Amount to be converted $ 475,000
----------------
Number of shares of Common Stock 237,500
----------------
Dated: 10-27-00
--------
/s/
----------------------------------
Signature: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Manager
Complete the following for registration of shares of Common Stock, if they are
to be delivered, or Debentures, if they are to be issued, other than to and in
the name of the registered owner:
-------------------------------------
Name
-------------------------------------
-------------------------------------
-------------------------------------
Address
-------------------------------------
Soc. Sec. or Tax I.D. No.