Exhibit 4.1
SECURITIES PURCHASE AGREEMENT
Securities Purchase Agreement (this "Agreement"), dated as of November
18, 2002, by and between Decorize, Inc., a Delaware corporation (the "Company"),
and Quest Capital Alliance, L.L.C., a Missouri limited liability company
("Purchaser").
WHEREAS, the Company proposes to issue and sell to Purchaser for cash
the number of shares of common stock, $0.001 par value, of the Company (the
"Common Stock"), set forth next to Purchaser's name on Exhibit A hereto, and
those certain Warrants to purchase an equal number of shares of Common Stock
(the "Warrants"), on the terms and conditions set forth below; and
WHEREAS, the Company, among other things, has agreed to provide certain
registration rights under the Securities Act of 1933, as amended from time to
time (the "Securities Act"), with respect to the shares of Common Stock,
including those issuable upon exercise of Warrants, that are being issued to
Purchaser pursuant to this Agreement.
NOW THEREFORE, in consideration of the above recitals and the mutual
covenants set forth herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01 The terms defined in this Section 1.01 shall have for all purposes
of this Agreement the respective meanings specified below.
"Agreement" shall mean this Securities Purchase Agreement as it may be
amended from time to time.
"Business Day" shall mean any day, other than a Saturday or Sunday, on
which commercial banks are open for business with the public in ▇▇▇▇▇▇ County,
Missouri.
"Closing" shall mean the consummation of the purchase and sale of the
Securities.
"Closing Date" shall mean November 19, 2002, or such later date on
which the conditions set forth in Articles VI and VII hereof have been satisfied
or waived.
"Closing Documents" shall mean this Agreement, the stock certificates
representing the Shares, the certificates representing the Warrants, the
Registration Rights Agreement and any other document required by this Agreement
as a condition to the obligations of Purchaser under this Agreement or executed
or delivered by the Company at the Closing.
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"Common Stock" shall mean the common stock, $0.001 par value of the
Company.
"Company" shall mean Decorize, Inc., a Delaware corporation, and its
successors and assigns.
"Exhibit" is a reference to an exhibit attached to this Agreement.
"Material Adverse Change" shall mean a material and adverse change in
the business, assets, financial condition, results of operations, affairs or
prospects of the Company and its subsidiaries, taken as a whole.
"Registration Rights Agreement" shall mean that certain Registration
Rights Agreement made and entered into as of the Closing Date, by and between
the Company and Purchaser (the form of which is attached as Exhibit B).
"Schedule" is a reference to a schedule attached to this Agreement.
"Section" shall mean a section or subsection of this Agreement.
"Securities" shall mean any of the Shares and Warrants purchased and
sold under this Agreement, and any Warrant Shares or other shares of capital
stock issued or issuable thereunder from time to time.
"Securities Act" shall have the meaning set forth in the recitals
hereto.
"Shares" shall mean the shares of Common Stock issued and sold by the
Company to Purchaser at the Closing in the manner prescribed by this Agreement.
"Warrants" shall mean those certain Warrants to purchase shares of
Common Stock, dated the Closing Date (the form of the certificate for which is
attached as Exhibit C), which provides for the issuance of each Warrant Share
upon the payment of an initial exercise price of $2.80 per Warrant Share.
"Warrant Shares" shall mean the shares of Common Stock issued or
issuable upon exercise of the Warrants, as such number of shares issuable may be
adjusted from time to time under the Warrants.
ARTICLE II
PURCHASE, SALE AND TERMS OF COMMON STOCK AND WARRANTS
2.01 The Shares. The Company has authorized the issuance and sale to
Purchaser of an aggregate 357,143 shares of Common Stock upon the terms and
subject to the conditions described herein. The Shares will have the same rights
as all other outstanding shares of Common Stock, as set forth in the Company's
Certificate of Incorporation.
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2.02 The Warrants. The Company has also authorized the issuance and
sale to Purchaser of the Warrants, which grants Purchaser the right and option
to purchase the Warrant Shares on the terms set forth therein. The Warrants may
be exercised in whole or in part as set forth in the Warrant. The number of
Warrant Shares subject to each Warrant and the exercise price are subject to
further adjustment as set forth in the Warrant.
2.03 Closing of Purchase and Sale of Share and Warrants. At the
Closing, the Company agrees to issue and sell to Purchaser, and Purchaser agrees
to purchase, an aggregate 357,143 Shares and the Warrants for a total purchase
price equal to $500,000.00. The purchase and sale of the Shares and the issuance
of the Warrants to Purchaser shall take place by express delivery exchange of
the Closing Documents on the Closing Date, with the Closing to be held at the
offices of ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C., ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇. At the Closing, the Company shall deliver to Purchaser certificates
representing the Shares and the Warrants, against payment of the purchase price,
and the Company and Purchaser shall deliver such other agreements, documents and
certificates as specified in this Agreement or as may be reasonably requested by
each party. The purchase price shall be paid by wire transfer to an account
designated by the Company.
2.04 Registration of Warrants. The Company shall maintain a register of
the Warrants to record therein the name and address of the registered holders
thereof, instructions for notices, and other information for transfers or
exchanges of the Warrants. No transfer of a Warrant shall be valid unless made
by the registered holder with the prior written consent of the Company, which
shall not be unreasonably withheld and the registered holder shall be deemed the
owner thereof for purposes of this Agreement, including payment of principal and
interest thereon. Notwithstanding anything in this Section 2.04 to the contrary,
the transfer of any Warrant shall also be subject to the restrictions on
transfer set forth therein.
2.05 Further Assurances. The Company and Purchaser shall execute and
deliver such additional documents and take such additional actions as any party
reasonably may deem to be practical and necessary in order to consummate the
transactions contemplated by this Agreement and to vest more fully Purchaser's
ownership of the Shares and Warrants.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents, warrants and covenants, to the Company as
follows:
3.01 Authorization. Purchaser is duly organized, validly existing and
in good standing under the laws of its jurisdiction. Purchaser has the necessary
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. The execution and delivery of, and the performance under,
this Agreement by Purchaser will not conflict with any rule, regulation,
judgment or agreement applicable to Purchaser.
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3.02 Investment Purpose. Purchaser was not formed for the purpose of
acquiring the Securities. Purchaser is purchasing the Securities for investment
purposes and not with a present view to, or for sale in connection with, a
distribution thereof within the meaning of the Securities Act. Purchaser
understands that it may not be able to sell or otherwise dispose of the
Securities, and accordingly it must bear the economic risk of this investment
indefinitely.
3.03 Reliance On Exemptions. Purchaser understands that the Securities
have not been registered under the Securities Act or any state securities laws
and are being offered and sold in reliance upon specific exemptions from the
registration requirements of federal and state securities laws, and that the
Company is relying upon the truth and accuracy of the representations and
warranties of Purchaser set forth herein in order to determine the availability
of such exemptions and the eligibility of Purchaser to acquire the Securities.
3.04 Information. Purchaser has been furnished all documents relating
to the business, finances and operations of the Company that Purchaser requested
from the Company and has been able to evaluate the risks and merits associated
with an investment in the Securities to its satisfaction. Purchaser has been
afforded the opportunity to ask questions of the Company's representatives
concerning the Company in making the decision to purchase and acquire the
Securities, and such questions have been answered to its satisfaction.
3.05 Governmental Review. Purchaser understands that no federal or
state agency or any other government or governmental agency has passed upon or
made any recommendation or endorsement of the Securities.
3.06 Purchaser's Qualifications. Purchaser is an "accredited investor"
as defined in Rule 501 under Regulation D of the Securities Act ("Regulation
D"). Purchaser is capable of evaluating the merits and risks of an investment in
the Securities.
3.07 Restrictions on Transfer. Purchaser covenants and agrees that it
shall not transfer any of the Securities unless such Securities are registered
under the Securities Act or unless an exemption from registration and
qualification requirements is available under the Securities Act and applicable
state securities laws and the Company has received an opinion of counsel
satisfactory to it stating that such registration and qualification is not
required. Purchaser understands that certificates representing the Shares, the
Warrants and the Warrant Shares shall bear the following, or a substantially
similar, legend until such time as they have been registered under the
Securities Act or otherwise may be sold without volume or other limitations
under Rule 144 under the Securities Act:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THESE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO REGISTRATION UNDER THE ACT
AND APPLICABLE STATE SECURITIES LAWS, OR UPON RECEIPT BY THE COMPANY OF
AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.
3.08 Residence. Purchaser is a resident of the jurisdiction set forth
under its name on the signature pages hereto.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth on the Schedule of Exceptions attached hereto as
Exhibit D, the Company represents and warrants to Purchaser as follows:
4.01 Organization and Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and has all necessary corporate power and authority to own or lease
its assets and to carry on its business as now being conducted and presently
proposed to be conducted. The Company is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction in which its
ownership or leasing of assets, or the conduct of its business, makes such
qualification necessary, except where the failure to be so qualified would not
result in a Material Adverse Change. Except for any subsidiaries listed on
Section 4.02 of the Schedule of Exceptions, the Company has no subsidiaries and
no equity interests in any corporation, partnership, joint venture or other
entity.
4.02 Subsidiaries. Section 4.02 of the Schedule of Exceptions sets
forth each subsidiary of the Company, showing the jurisdiction of its
incorporation or organization. Each subsidiary is validly existing and in good
standing under the laws of the state or other jurisdiction of its incorporation
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. All of the
outstanding shares of capital stock of each subsidiary have been duly authorized
and validly issued, and are fully paid and nonassessable and are owned by the
Company.
4.03 Requisite Power and Authorization. The Company has all necessary
corporate power and authority to execute and deliver the Closing Documents and
to perform its obligations under each of the Closing Documents, including
without limitation the issuance of the Securities hereunder. All corporate
action of the Company required for the execution and delivery of the Closing
Documents and the issuance and delivery of the Securities has been duly and
effectively taken, and no further actions, authorizations or consents,
including, without limitation, any consents of the stockholders of the Company,
are required. Each of the Closing Documents constitutes the valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditor's rights, (ii) as limited by general principles of
equity that restrict the availability of equitable remedies and (iii) as the
indemnity provisions of the Registration Rights Agreement may be limited by law.
The Shares, when issued at the Closing in compliance with the provisions of this
Agreement, will be validly issued, fully paid and non-assessable, free and clear
of any and all liens, charges, claims or encumbrances. The Warrant Shares, if
and when issued, delivered and paid for in compliance with the provisions of
this Agreement and the Warrants, as applicable, will be validly issued, fully
paid and non-assessable, free and clear of any and all liens, charges, claims or
encumbrances. The Company has reserved a sufficient number of shares of Common
Stock necessary for issuance of the Warrant Shares.
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4.04 SEC Documents. The Company has filed with the Securities and
Exchange Commission (the "SEC") all reports, statements, schedules and other
documents (collectively, the "SEC Documents") required to be filed by it
pursuant to the Securities Act and the Securities Exchange Act of ▇▇▇▇ (▇▇▇
"▇▇▇▇▇▇▇▇ ▇▇▇"). Since June 30, 2001, all SEC Documents required to be filed
were timely filed. As of their respective dates, the SEC Documents complied in
all material respects with the requirements of the Securities Act or the
Exchange Act, as the case may be, and the rules and regulations of the SEC
promulgated thereunder, and none of the SEC Documents, at the time they were
filed with the SEC, contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. As of their respective dates, the financial statements
included in the SEC Documents (the "Financial Statements") complied as to form
in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto. Except (i) as
may be indicated in the notes to the Financial Statements or (ii) in the case of
the unaudited interim statements, as permitted by Form 10-Q under the Exchange
Act, the Financial Statements have been prepared in accordance with generally
accepted accounting principles consistently applied 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 its operations and cash flows for the
periods then ended (subject, in the case of unaudited statements, to normal
recurring year-end adjustments and footnotes). Except as set forth in the
Financial Statements filed with the SEC prior to the date hereof, neither the
Company nor any of its subsidiaries has any liabilities, whether absolute,
contingent or otherwise, other than (i) liabilities incurred in the ordinary
course of business subsequent to the date of such Financial Statements, (ii)
obligations under contracts and commitments incurred in the ordinary course of
business and not required under generally accepted accounting principles to be
reflected in such Financial Statements, which liabilities and obligations
referred to in clauses (i) and (ii), individually or in the aggregate, are not
material to the financial condition or operating results of the Company or any
of its subsidiaries and (iii) liabilities and obligations incurred in connection
with the Closing Documents and the transactions contemplated thereby.
4.05 Capitalization. The capitalization of the Company (on a fully
diluted basis) as of the date hereof is set forth on Section 4.05 of the
Schedule of Exceptions, including (i) the authorized capital stock, (ii) the
number of shares issued and outstanding, after giving effect to the issuance of
the Shares (iii) the number of shares reserved for issuance pursuant to stock
option, employee benefit or other plans, (iv) the number of shares reserved for
issuance or issuable pursuant to securities exercisable for, or convertible into
or exchangeable for, any shares of Common Stock, and (v) the number of Warrant
Shares reserved for issuance upon exercise of the Warrants. All outstanding
shares of capital stock have been duly authorized and validly issued and are
fully paid and non-assessable. Except as set forth on Section 4.05 of the
Schedule of Exceptions or otherwise contemplated hereunder, the Company has (i)
no outstanding securities convertible into or exchangeable for any shares of
capital stock of the Company, (ii) no rights, options, warrants, calls or other
agreements or commitments of any nature whatsoever relating to the purchase or
other acquisition of any shares of its capital stock or securities convertible
into or exchangeable for any shares of its capital stock or (iii) no shares of
its capital stock reserved for issuance.
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4.06 No Conflicts. Neither the execution, delivery and performance by
the Company of this Agreement, the other Closing Documents, and all instruments
and documents to be delivered by the Company, nor the consummation of the
transactions contemplated by any of the foregoing (i) has constituted or
resulted in, or will constitute or result in, a default under or breach or
violation of any term or provision of the Certificate of Incorporation or bylaws
of the Company or material contracts or instruments to which the Company or any
of its subsidiaries is a party or federal, state or local laws, rules or
regulations, writs, orders, judgments or decrees which are applicable to the
Company, any of its subsidiaries or their assets, (ii) will result in the
acceleration or termination of any rights under any contract or instrument to
which the Company or any of its subsidiaries is a party or (iii) will result in
the creation or imposition of any liens, charges or encumbrances upon any assets
of the Company or any of its subsidiaries.
4.07 Consents. Other than those that will be obtained before the
Closing, no approval, consent, order, authorization or other action by, or
notice to or filing with, any governmental authority or regulatory agency or any
other person or entity, and no lapse of a waiting period, is required in
connection with the execution, delivery or performance by the Company of this
Agreement, any other Closing Document, the issuance and delivery of any of the
Securities or any other transactions contemplated by any of the Closing
Documents except for (i) the filing of a Form D with the SEC, (ii) filings
required under applicable state "blue sky" laws (which shall be duly filed and
effective prior to the Closing if so required under such laws) and (iii) the
filing of a registration statement or statements pursuant to the Registration
Rights Agreement.
4.08 No Material Adverse Change. Since the date of the most recent SEC
Documents, the business of the Company and each subsidiary has been operated in
the ordinary course and substantially consistent with past practice and there
has not been any Material Adverse Change.
4.09 Litigation. There is no claim, action, suit, proceeding or
investigation pending or, to the Company's knowledge, currently threatened
against the Company or any of its subsidiaries, or any of their respective
directors or officers, in their capacities as such, (i) that questions the
validity of this Agreement or any other Closing Document or the issuance of the
Securities, or the right of the Company to enter into this Agreement or any
other Closing Document or to consummate the transactions contemplated by any
Closing Document or (ii) that might result, either individually or in the
aggregate, in any Material Adverse Change or in any change in the current equity
ownership of the Company.
4.10 The American Stock Exchange. The Common Stock is listed on The
American Stock Exchange ("AMEX"), and there are no proceedings to revoke or
suspend such listing. The sale of the Securities as contemplated hereby will not
result in a violation of the AMEX rules and regulations.
4.11 No Misrepresentation. No representation or warranty by the Company
in this Agreement (including any Exhibit or Schedule hereto) and no statements
of the Company contained in any document, certificate, schedule or other
information furnished or to be furnished by or on behalf of the Company pursuant
to this Agreement or any other Closing Document or in connection with the
transactions contemplated by any Closing Document contains or shall contain any
untrue statement of material fact or omits or shall omit to state a material
fact required to be stated therein or necessary in order to make such
statements, in light of the circumstances under which they were made, not
misleading. Except for the transactions contemplated hereby, no event or
circumstance has occurred or exists with respect to the Company or any of its
subsidiaries or their respective business affairs, assets, properties,
prospects, operations or financial condition which has not been publicly
disclosed, but which, under applicable law, rule or regulation, would be
required to be disclosed by the Company in a registration statement filed on the
date hereof by the Company under the Securities Act with respect to the primary
issuance of the Company's securities. The Company has delivered true and
complete copies of all documents requested by Purchaser.
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4.12 No Brokers or Finders. No person or entity has or will have, as a
result of any engagement or contractual obligation incurred by the Company, any
right, interest or valid claim against Purchaser for any commission, fee or
other compensation as a finder or broker, or in any similar capacity, in
connection with the transactions contemplated by this Agreement.
ARTICLE V
COVENANTS OF THE COMPANY
The Company hereby covenants and agrees that, for so long as Purchaser
continues to own the Shares originally issued at the Closing:
5.01 Exchange Act Filings. The Company shall use its best commercial
efforts to file in a timely manner all reports and other documents required to
be filed by it under the Exchange Act. The Company shall not terminate its
status as an issuer required to file reports under the Exchange Act even if the
Exchange Act or the rules and regulations promulgated thereunder would permit
such termination.
5.02 Authorized Shares. The Company shall, from and at all times after
the Closing that the Warrants remain outstanding, maintain a reserve of
authorized shares of Common Stock sufficient to cover the issuance of the
Warrant Shares underlying the Warrants.
5.03 Removal of Legends. Any legend endorsed on a certificate pursuant
to Section 3.07 and any related stop transfer instructions with respect to any
Securities shall be removed, and the Company shall within ten (10) Business Days
request its transfer agent to issue promptly a certificate without such legend
to the holder thereof, if (i) such Securities shall be registered under the
Securities Act, (ii) such legend may be properly removed under the terms of Rule
144 under the Securities Act or (iii) such holder shall provide the Company with
an opinion of counsel, satisfactory to the Company, to the effect that a sale,
transfer or assignment of such Securities may be made pursuant to Rule 144(k)
under the Securities Act.
ARTICLE VI
CONDITIONS TO OBLIGATIONS OF PURCHASER AT THE CLOSING
The obligation of Purchaser to purchase the Shares and the Warrants at
the Closing shall be subject to the fulfillment on or prior to the Closing Date
of the following conditions, any of which may be waived by Purchaser:
6.01 Closing Documents. The Company shall have delivered to Purchaser
this Agreement, the certificate representing the Shares, the certificate
representing the Warrants, the Registration Rights Agreement and all related
documentation required by this Agreement on the transactions contemplated
hereby, all duly executed by the Company.
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6.02 Representations and Warranties; Performance of Obligations. The
representations and warranties made by the Company in this Agreement and in any
other Closing Document shall be true and correct 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, except for
representations and warranties made as of a specific date which shall be true
and correct as of such date. The Company shall have performed, satisfied and
complied with all obligations and conditions required to be performed or
observed by it under this Agreement or any other Closing Document on or prior to
the Closing Date.
6.03 Consents and Waivers. The Company shall have made all filings and
obtained any and all consents (including, without limitation, all governmental
or regulatory consents), approvals or authorizations, permits and waivers
necessary or appropriate for consummation of the transactions contemplated by
this Agreement and any other Closing Document.
6.04 No Litigation or Legislation. No federal, state or local statute,
rule, regulation, decree, ruling or injunction shall have been enacted or
entered, and no litigation, proceeding, government inquiry or investigation
shall be pending, which challenges, prohibits or restricts, or seeks to prohibit
or restrict, the consummation of the transactions contemplated by this Agreement
or any other Closing Document, or restricts or impairs the ability of Purchaser
to own an equity interest in the Company.
6.05 Compliance Certificate. The Company shall have delivered to
Purchaser a certificate, executed by the Chief Executive Officer of the Company,
dated as of the Closing Date, certifying to the fulfillment of the conditions
set forth in Sections 6.03, 6.04 and 6.05.
6.06 Opinion of Counsel. Purchaser shall have received from ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇, P.C., counsel to the Company, an opinion addressed to Purchaser, dated
as of the Closing Date, in substantially the form attached hereto as Exhibit E.
6.07 Due Diligence and Other Agreements. Prior to Closing, Purchaser
shall have completed its due diligence with respect to the Company.
ARTICLE VII
CONDITIONS TO OBLIGATION OF THE COMPANY AT THE CLOSING
The obligation of the Company to sell and issue the Securities to
Purchaser at the Closing shall be subject to the fulfillment on or prior to the
Closing Date of the following conditions, any of which may be waived by the
Company:
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7.01 Purchase Price; Closing Documents. Purchaser shall have delivered
the purchase price for the Securities to be purchased by Purchaser hereunder.
Purchaser shall have delivered to the Company this Agreement and all related
documentation required by this Agreement or the transactions contemplated
hereby, all duly executed by Purchaser.
7.02 Representations and Warranties; Performance of Obligations. The
representations and warranties made by Purchaser in this Agreement shall be true
and correct when made, and shall be true and correct on the Closing Date with
the same force and effect as if they had been made on and as of said date.
Purchaser shall have performed, satisfied and complied with all obligations and
conditions required to be performed or observed by it under this Agreement or
any other Closing Document on or prior to the Closing Date.
7.03 No Litigation or Legislation. No federal, state or local statute,
rule, regulation, decree, ruling or injunction shall have been enacted or
entered, and no litigation, proceeding, government inquiry or investigation
shall be pending, which challenges, prohibits or restricts, or seeks to prohibit
or restrict, the consummation of the transactions contemplated by this Agreement
or any other Closing Document, or restricts or impairs the ability of Purchaser
to own an equity interest in the Company.
7.04 No Material Adverse Change. There shall not have occurred since
the execution of this Agreement any Material Adverse Change.
ARTICLE VIII
MISCELLANEOUS
8.01 Waiver. No course of dealing between Purchaser and any other party
hereto or any failure or delay on the part of Purchaser in exercising any rights
or remedies under this Agreement or any of the Closing Documents shall operate
as a waiver of any rights or remedies of Purchaser. No single or partial
exercise of any rights or remedies under this Agreement or any of the Closing
Documents shall operate as a waiver or preclude the exercise of any other rights
or remedies hereunder or thereunder.
8.02 Survival of Covenants; Successors and Assigns. All representations
and warranties of the Company contained in this Agreement, in the Schedules, or
in any exhibit, certificate, document or instrument delivered pursuant to this
Agreement shall survive the Closing and shall continue in full force and effect
for three years after the Closing Date. The parties hereto understand and agree
that this Agreement contains obligations, agreements and covenants that are
intended to and shall continue after the Closing and except as otherwise
provided herein, all covenants, agreements and obligations made herein, in the
other Closing Documents and in certificates delivered in connection herewith or
on behalf of the Company, shall survive the execution and delivery of this
Agreement and shall bind and inure to the benefit of the Company and its
successors and assigns and the holders of the Securities from time to time.
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8.03 Notices. Any notice or communication to be given under this
Agreement must be in writing and given by (a) deposit in the United States mail,
addressed to the party to be notified, postage prepaid and registered or
certified with return receipt requested, (b) delivery in person or by courier
service providing evidence of delivery, or (c) transmission by telecopy. Each
notice or communication that is mailed, delivered, or transmitted in the manner
described above shall be deemed sufficiently given, served, sent, and received,
in the case of mailed notices, on the third business day following the date on
which it is mailed and, in the case of notices delivered by hand, courier
service, or telecopy, at such time as it is delivered to the addressee (with the
delivery receipt or the affidavit of messenger) or at such time as delivery is
refused by the addressee upon presentation. Any notice or communication under
this Agreement must be addressed as set forth on the signature pages to this
Agreement. Any party may change its address for notice by written notice to the
other parties hereto.
8.04 Descriptive Headings. The descriptive headings of this Agreement
have been inserted for convenience only and shall not be deemed to limit or
otherwise affect the construction of any provisions hereof.
8.05 GOVERNING LAW. THIS AGREEMENT, THE WARRANTS, THE OTHER CLOSING
DOCUMENTS AND THE OTHER INSTRUMENTS EXECUTED HEREUNDER, ARE PERFORMABLE IN
▇▇▇▇▇▇ COUNTY, MISSOURI, AND SHALL BE INTERPRETED AND CONSTRUED IN ACCORDANCE
WITH, UNDER AND GOVERNED BY, THE LAWS OF THE STATE OF DELAWARE.
8.06 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed an original and all
of which shall constitute the same instrument, but only one of which need be
produced.
8.07 Expenses. All expenses, including (without limitation) attorneys'
and accountants' fees incurred or to be paid by the Company or Purchaser in
connection with the transactions contemplated by this Agreement shall be paid by
whichever of them incurred such expenses, as the case may be.
8.08 Binding Effect. This Agreement shall be binding upon the parties
hereto, together with their respective executors, administrators, successors,
personal representatives, heirs and assigns.
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8.09 Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws effective during
the term hereof, such provision shall be fully severable and this Agreement
shall be construed and enforced as if such illegal, invalid or unenforceable
provision never comprised a part hereof; and the remaining provisions hereof
shall remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance herefrom. Furthermore, in
lieu of such illegal, invalid or unenforceable provision, there shall be added
automatically as part of this Agreement, a provision as similar in its terms to
such illegal, invalid or unenforceable provision as may be possible and be
legal, valid and enforceable.
8.10 Changes, Modifications or Waivers. No change or modification of
this Agreement shall be valid or binding upon the parties hereto, nor shall any
waiver of any term or condition in the future be so binding, unless such change
or modification or waiver shall be in writing and signed by the Company and
Purchaser.
8.11 Miscellaneous. No failure or delay on the part of any party in
exercising any right, power or remedy hereunder or under the Warrants shall
operate as a waiver thereof. The waiver by any party of a breach of any
provision of this Agreement or the Warrants shall not operate or be construed as
a waiver of any subsequent breach. No modification, amendment or termination
under this Agreement or the Warrants shall be valid unless evidenced by a
writing signed by Purchaser. This Agreement and the other Closing Documents
constitute the entire agreement between the parties with respect to the subject
matter hereof and supersede all proposals and agreements, whether written or
oral, and all other communications between the parties relating to the subject
matter of this Agreement, the Shares or the Warrants. In the event that the
terms set forth in this Agreement and in the other Closing Documents conflict,
this Agreement shall control. The invalidity, illegality or unenforceability of
any provision of this Agreement or the other Closing Documents shall in no way
affect the validity, legality or enforceability of any other provision. This
Agreement and the other Closing Documents shall be binding upon and inure to the
benefit of the Company and Purchaser and their respective successors and
assigns.
8.12 Termination. This Agreement may be terminated and the transactions
contemplated hereby abandoned at any time prior to the Closing Date:
(a) by mutual written consent of the Company and Purchaser; or
(b) by either the Company or Purchaser if the transactions
contemplated hereby shall not have been consummated on or before the
close of business on November 22, 2002.
In the event of termination of this Agreement as provided above, this Agreement
shall forthwith become of no further effect and there shall be no liability or
obligation on the part of any party.
[SIGNATURE PAGE TO FOLLOW]
12
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as an instrument under seal and as of the date first above written.
THE COMPANY:
DECORIZE, INC.,
a Delaware corporation
By:
----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and CFO
Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
PURCHASER:
QUEST CAPITAL ALLIANCE, L.L.C.
a Missouri limited liability company
By:
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇
Title: General Manager
Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Manager
13
EXHIBIT LIST
Exhibit A: Securities Schedule
Exhibit B: Registration Rights Agreement
Exhibit C: Form of Warrant
Exhibit E: Opinion of Counsel
14
EXHIBIT A
Schedule of Purchasers
Number of Shares of Number of Shares Issuable Under
Purchaser Common Stock Warrants Purchase Price
--------- ------------ -------- --------------
Quest Capital Alliance 357,143 357,143 $500,000.00
Total 357,143 357,143 $500,000.00
A-1
EXHIBIT B
Registration Rights Agreement
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement ("Agreement"), dated as of November
18, 2002, is made and entered into by and between Decorize, Inc., a Delaware
corporation (the "Company"), and Quest Capital Alliance, L.L.C., a Missouri
limited liability company (the "Holder").
WITNESSETH:
WHEREAS, the Company has entered into that certain Securities Purchase
Agreement dated as of even date herewith (the "Purchase Agreement"), whereby the
Company will sell and the Holder will buy certain of the Company's securities on
the terms and subject to the restrictions contained in the Purchase Agreement;
and
WHEREAS, in consideration of the purchase by the Holder of the
Company's securities pursuant to the Purchase Agreement, the Company has agreed
to grant the Holder the registration rights set forth in this Agreement;
NOW, THEREFORE, in consideration of the representations, covenants and
agreements contained herein, and certain other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
DEFINITIONS
The terms defined in this Article I shall have for all purposes of this
Agreement the respective meanings set forth below:
"Board" shall mean the Board of Directors of the Company.
"Common Stock" shall mean the Common Stock, $0.001 par value, of the
Company, and any other class of capital stock of the Company that is duly
authorized and issued from time to time that does not have preferential rights
as to dividends or distributions of the Company's assets over any other class of
capital stock of the Company, including any shares issued in exchange for shares
of Common Stock upon any recapitalization by the Company.
"Exchange Act" shall mean the Securities and Exchange Act of 1934, as
it may be amended from time to time.
"Misstatement" shall mean an untrue statement of a material fact or an
omission to state a material fact required to be stated in a Registration
Statement or Prospectus or necessary to make the statements in a Registration
Statement or Prospectus not misleading.
"Person" shall mean a natural person, partnership, corporation,
business trust, association, joint venture or other entity or a government or
agency or political subdivision thereof.
"Prospectus" shall mean the prospectus included in any Registration
Statement, as supplemented by any and all prospectus supplements and as amended
by any and all post-effective amendments and including all material incorporated
by reference in such prospectus.
"Purchase Agreement" shall mean the Securities Purchase Agreement,
dated as of even date herewith, to which the Company and the Holder are parties.
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"Registrable Security" shall mean (a) an outstanding share of Common
Stock issued by the Company to the Holder pursuant to the Purchase Agreement,
including any shares of Common Stock issued upon the exercise of the Warrants
sold to the Holder thereunder, and (b) any security issued or issuable with
respect to such Common Stock by way of a stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or reorganization; provided, that, any such share or security shall be deemed to
be Registrable Security only if and so long as it is a Transfer Restricted
Security.
"Registration" shall mean either a Demand Registration described in
Section 2(a) or a Piggyback Registration described in Section 2(b) hereof.
"Registration Expenses" shall mean the out-of-pocket expenses of a
Registration, including without limitation the following:
(1) all registration and filing fees (including fees with
respect to filings required to be made with the National Association of
Securities Dealers, Inc.) and any securities exchange on which the
Common Stock is then listed;
(2) fees and expenses of compliance with securities or blue
sky laws (including reasonable fees and disbursements of counsel for
the underwriters in connection with blue sky qualifications of the
Registrable Securities);
(3) printing, messenger, telephone and delivery expenses;
(4) reasonable fees and disbursements of counsel for the
Company; and
(5) reasonable fees and disbursements of all independent
certified public accountants of the Company incurred specifically in
connection with such Registration.
"Registration Statement" shall mean any registration statement which
covers Registrable Securities pursuant to the provisions of this Agreement,
including the Prospectus included in such registration statement, amendments
(including post-effective amendments) and supplements to such registration
statement, and all exhibits to and all material incorporated by reference in
such registration statement.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended from
time to time.
"Transfer Restricted Security" shall mean an issued and outstanding
security that has not been sold to or through a broker, dealer or underwriter in
a public distribution or other public securities transaction or sold in a
transaction exempt from the registration and prospectus delivery requirements of
the Securities Act under Rule 144(k) promulgated thereunder (or any successor
rule other than Rule 144A). A security shall cease being a Transfer Restricted
Security if (i) all stop transfer instructions or notations and restrictive
legends with respect to such security are eligible to be removed, and (ii) the
Holder of such security has received an opinion of counsel to the Company, to
the effect that such security in the Holder's hands are freely transferable in
any public or private transaction without registration under the Securities Act
(or the Holder has waived receipt of such opinion).
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"Underwritten Registration" or "Underwritten Offering" shall mean a
Registration in which securities of the Company are sold to an underwriter for
distribution to the public.
ARTICLE II
REGISTRATIONS
2.01 Demand Registration. Subject to the restrictions set forth below,
if at any time after the Closing (as defined in the Purchase Agreement), the
Company shall receive from the Holder a written request to register at least
fifty percent (50%) of the Registrable Securities owned by the Holder (or its
respective successors and permitted assigns) as of the date of such request,
then the Company shall effect as soon thereafter as practicable, and in any
event within fifteen (15) days of the receipt of such request, the Registration
under the Securities Act of all Registrable Securities which the Holder requests
to be registered. The Company shall not be obligated to effect, or to take any
action to effect, any such registration pursuant to this Section 2.01:
(a) if the offering cannot be made on Form S-3 for any reason
other than the Company's failure to timely file its period reports
under the Exchange Act; or
(b) if in the good faith judgment of the Board of Directors of
the Company, such Registration would be seriously detrimental to the
Company and the Board of Directors of the Company concludes, as a
result, that it is essential to defer the filing of such Registration
Statement at such time, and the Company shall furnish to the Holder a
certificate signed by the President of the Company stating that in the
good faith judgment of the Board of Directors of the Company, it would
be seriously detrimental to the Company for such Registration Statement
to be filed in the near future and that it is, therefore, essential to
defer the filing of such Registration Statement. In such event, the
Company shall have the right to defer such filing (except as provided
in subparagraph (a) above) for a period of not more than one hundred
eighty (180) days after receipt of the request of the Holder; provided,
that the Company shall not defer its obligation in this manner more
than twice in any 12-month period.
Furthermore, the Company shall not be required to effect more than two (2)
Registrations under this Section 2.01 on behalf of the Holder; provided, that a
Registration shall not be counted for such purposes unless such Registration has
become effective and all of the Registrable Securities to be registered on
behalf of the Holder has been sold, in accordance with Section 3.01(a) of this
Agreement.
2.02 Piggyback Registration. Each time the Company decides to file a
Registration Statement under the Securities Act with respect to its Common Stock
(other than on Forms S-4 or S-8 or any successor form for the registration of
securities issued or to be issued in connection with a merger or acquisition or
employee benefit plan), including any Registration Statement filed on behalf of
stockholders of the Company exercising registration rights granted by the
Company with respect to such shares, the Company shall give written notice
thereof to the Holder. The Company shall include in such Registration Statement
such shares of Registrable Securities for which it has received written requests
to register such shares within thirty (30) days after such written notice has
been given. If in the good faith judgment of the managing underwriter in any
Underwritten Offering, the inclusion of all of the shares of Registrable
Securities and any other Common Stock requested to be registered by third
parties holding similar registration rights would interfere with the successful
marketing of a smaller number of such shares, then the number of shares of
Registrable Securities and other Common Stock to be included in the offering
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(except for shares to be issued by the Company in an offering initiated by the
Company) shall be reduced as provided herein. The Company shall advise the
Holder requesting registration of the underwriters' decision, and the number of
shares that are entitled to be included in the Underwritten Registration shall
be allocated first to the Company for securities being sold for its own account
and thereafter as set forth in Section 2.03 below. If any person does not agree
to the terms of any such underwriting, then he shall be excluded therefrom by
written notice from the Company or the underwriter. Any Registrable Securities
or other securities excluded or withdrawn from such underwriting shall be
withdrawn from such registration. If shares are so withdrawn from the
registration or if the number of Registrable Securities to be included in such
registration was previously reduced as a result of marketing factors, the
Company shall then offer to all persons who have retained the right to include
securities in the registration the right to include additional securities in the
registration in an aggregate amount equal to the number of shares so withdrawn,
with such shares to be allocated among the persons requesting additional
inclusion in accordance with Section 2.03 below.
2.03 Registration Cutback. In any circumstance in which all of the
Registrable Securities and other shares of Common Stock of the Company
(including shares of Common Stock issued or issuable upon conversion of any
currently unissued securities of the Company) with registration rights (the
"Other Shares") requested to be included in a registration on behalf of the
Holder or other selling stockholders cannot be so included as a result of
limitations of the aggregate number of shares of Registrable Securities and
Other Shares that may be so included, the number of shares of Registrable
Securities and Other Shares that may be so included shall be allocated among the
Holder and other selling stockholders requesting inclusion of shares pro rata on
the basis of the number of shares Registrable Securities and Other Shares that
would be held by the Holder and such other selling stockholders, assuming
conversion. If the Holder or any other selling stockholder does not request
inclusion of the maximum number of shares of Registrable Securities and Other
Shares allocated to him or it pursuant to the above-described procedure, the
remaining portion of such stockholder's allocation shall be reallocated among
those other selling stockholders whose allocations did not satisfy their
requests pro rata on the basis of the number of Registrable Securities and Other
Shares which would be held by the Holder and other selling stockholders,
assuming conversion, and this procedure shall be repeated until all of the
shares of Registrable Securities and Other Shares which may be included in the
registration on behalf of the Holder and other selling stockholders have been so
allocated.
ARTICLE III
COMPANY PROCEDURES
3.01 General Procedures. If and whenever the Company is required to
register Registrable Securities, the Company will use its best efforts to effect
such registration to permit the sale of such Registrable Securities in
accordance with the intended plan of distribution thereof, and pursuant thereto
the Company will as expeditiously as possible:
(a) prepare and file with the SEC as soon as practicable a
Registration Statement with respect to such Registrable Securities and
use its reasonable best efforts to cause such Registration Statement to
become effective and remain effective until the Registrable Securities
covered by such Registration Statement have been sold;
(b) prepare and file with the SEC such amendments and
post-effective amendments to the Registration Statement, and such
supplements to the Prospectus, as may be requested by the Holder or any
underwriter of Registrable Securities or as may be required by the
rules, regulations or instructions applicable to the registration form
used by the Company or by the Securities Act or rules and regulations
thereunder to keep the Registration Statement effective until all
Registrable Securities covered by such Registration Statement are sold
in accordance with the intended plan of distribution set forth in such
Registration Statement or supplement to the Prospectus;
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(c) deliver to the Holder and the underwriters, if any,
without charge, as many copies of each Prospectus (and each preliminary
prospectus) as such Persons may reasonably request (the Company hereby
consents to the use of each such Prospectus (or preliminary prospectus)
by the Holder and the underwriters, if any, in connection with the
offering and sale of the Registrable Securities covered by such
Prospectus (or preliminary prospectus)) and a reasonable number of
copies of the then-effective Registration Statement and any
post-effective amendments thereto and any supplements to the
Prospectus, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those
incorporated by reference);
(d) prior to any public offering of Registrable Securities,
register or qualify or cooperate with the Holder, the underwriters, if
any, and their respective counsel in connection with the registration
or qualification of such Registrable Securities for offer and sale
under the securities or blue sky laws of such jurisdictions as the
Holder or such underwriters may designate in writing and do anything
else necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the Registration
Statement; provided, that the Company shall not be required to qualify
generally to do business in any jurisdiction where it is not then so
qualified or to take any action which would subject it to general
service of process in any such jurisdiction where it is not then so
subject;
(e) cause all such Registrable Securities to be listed on each
securities exchange or automated quotation system on which similar
securities issued by the Company are then listed;
(f) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such
Registration Statement;
(g) advise each seller of such Registrable Securities,
promptly after it shall receive notice or obtain knowledge thereof, of
the issuance of any stop order by the SEC suspending the effectiveness
of such Registration Statement or the initiation or threatening of any
proceeding for such purpose and promptly use its reasonable best
efforts to prevent the issuance of any stop order or to obtain its
withdrawal if such stop order should be issued;
(h) at least three days prior to the filing of any
Registration Statement or prospectus or any amendment or supplement to
such Registration Statement or prospectus or any document that is to be
incorporated by reference into such Registration Statement or
prospectus, furnish a copy thereof to each seller of such Registrable
Securities or their counsel;
(i) notify the Holder at any time when a prospectus relating
to such Registration Statement is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in such Registration Statement, as then in effect,
includes a Misstatement, and then to correct such Misstatement as set
forth in Section 3.05; and
B-5
(j) permit a representative of the Holder, the underwriters,
if any, and any attorney or accountant retained by the Holder or
underwriter to participate, at each such Person's own expense, in the
preparation of the Registration Statement, and cause the Company's
officers, directors and employees to supply all information reasonably
requested by any such representative, underwriter, attorney or
accountant in connection with the Registration; provided, however, that
such representatives, underwriters, attorneys or accountants enter into
a confidentiality agreement, in form and substance reasonably
satisfactory to the Company, prior to the release or disclosure of any
such information.
3.02 Registration Expenses. The Registration Expenses of all
Registrations shall be borne by the Company. It is acknowledged by the Holder
that the Holder will bear all incremental selling expenses relating to the sale
of the Registrable Securities, such as underwriters' commissions and discounts,
brokerage fees, underwriter marketing costs and all fees and expenses of any
legal counsel representing the Holder.
3.03 Requirements for Participation in Underwritten Offerings. No
person may participate in any Underwritten Offering for equity securities of the
Company pursuant to a Registration initiated by the Company hereunder unless
such Person (a) agrees to sell such Person's securities on the basis provided in
any underwriting arrangements approved by the Company and (b) completes and
executes all questionnaires, powers of attorney, indemnities, lock-up
agreements, underwriting agreements and other documents required under the terms
of such underwriting arrangements.
3.04 Suspension of Sales. Upon receipt of written notice from the
Company that a Registration Statement or Prospectus contains a Misstatement, the
Holder shall forthwith discontinue disposition of Registrable Securities until
it has received copies of a supplemented or amended Prospectus correcting the
Misstatement (it being understood that the Company hereby covenants to prepare
and file such supplement or amendment as soon as practicable after the time of
such notice), or until it is advised in writing by the Company that the use of
the Prospectus may be resumed.
3.05 Reporting Obligations. As long as the Holder shall own Registrable
Securities, the Company, at all times while it shall be reporting under the
Exchange Act, covenants to file timely (or obtain extensions in respect thereof
and file within the applicable grace period) all reports required to be filed by
the Company after the date hereof pursuant to Section 13(a) or 15(d) of the
Exchange Act and to promptly furnish the Holder with true and complete copies of
all such filings. The Company further covenants that it will take such further
action as the Holder may reasonably request, all to the extent required from
time to time to enable the Holder to sell shares of Common Stock held by the
Holder without registration under the Securities Act within the limitation of
the exemptions provided by Rule 144 promulgated under the Securities Act ("Rule
144"), including providing any legal opinions. Upon the request of the Holder,
the Company shall deliver to the Holder a written certification of a duly
authorized officer as to whether it has complied with such requirements.
3.06 Indemnification.
(a) The Company agrees to indemnify, to the extent permitted
by law, the Holder of Registrable Securities, its officers and
directors and each Person who controls the Holder (within the meaning
of the Securities Act) against all losses, claims, damages, liabilities
and expenses (including attorneys' fees) caused by any untrue or
alleged untrue statement of material fact contained in any Registration
Statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as the same are
B-6
caused by or contained in any information furnished in writing to the
Company by the Holder expressly for use therein or by the Holder's
failure to deliver a copy of the Registration Statement or prospectus
or any amendments or supplements thereto after the Company has
furnished the Holder with a sufficient number of copies of the same.
The Company will indemnify the underwriters, their officers and
directors and each Person who controls such underwriters (within the
meaning of the Securities Act) to the same extent as provided above
with respect to the indemnification of the Holder.
(b) In connection with any Registration Statement in which the
Holder of Registrable Securities is participating, the Holder will
furnish to the Company in writing such information and affidavits as
the Company reasonably requests for use in connection with any such
Registration Statement or prospectus and, to the extent permitted by
law, will indemnify the Company, its directors and officers and agents
and each Person who controls the Company (within the meaning of the
Securities Act) against any losses, claims, damages, liabilities and
expenses (including without limitation reasonable attorneys' fees)
resulting from any untrue statement of material fact contained in the
Registration Statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission of a material
fact required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that such untrue
statement or omission is contained in any information or affidavit so
furnished in writing by the Holder expressly for use therein; provided,
that the obligation to indemnify will be several, not joint and
several, among the Holder and any other stockholder with Registrable
Securities in such Registration, and the liability of each such
stockholder will be in proportion to and limited to the gross amount
received by such stockholder from the sale of Registrable Securities
pursuant to such Registration Statement. The Holder of Registrable
Securities will indemnify the underwriters, their officers, directors
and each Person who controls such underwriters (within the meaning of
the Securities Act) to the same extent as provided above with respect
to indemnification of the Company.
(c) Any person entitled to indemnification herein will (i)
give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification and (ii) unless in such
indemnified party's reasonable judgment a conflict of interest between
such indemnified and indemnifying parties may exist with respect to
such claim, permit such indemnifying party to assume the defense of
such claim with counsel reasonably satisfactory to the indemnified
party. If such defense is assumed, the indemnifying party will not be
subject to any liability for any settlement made by the indemnified
party without its consent (but such consent will not be unreasonably
withheld). An indemnifying party who is not entitled to, or elects not
to, assume the defense of a claim will not be obligated to pay the fees
and expenses of more than one counsel for all parties indemnified by
such indemnifying party with respect to such claim, unless in the
reasonable judgment of any indemnified party a conflict of interest may
exist between such indemnified party and any other of such indemnified
parties with respect to such claim.
(d) The indemnification provided for under this Agreement will
remain in full force and effect regardless of any investigation made by
or on behalf of the indemnified party or any officer, director or
controlling person of such indemnified party and will survive the
transfer of securities. The Company and the Holder of Registrable
Securities participating in the offering also agrees to make such
provisions as are reasonably requested by any indemnified party for
contribution to such party in the event the Company's or the Holder's
indemnification is unavailable for any reason.
B-7
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with an Underwritten
Offering are in conflict with the foregoing provisions, the provisions
of the underwriting agreement shall control.
3.07 Restrictions on Public Sales. In consideration of the agreements
contemplated herein, the Holder and the Company further agree to the following
restrictions:
(a) The Holder, if the Company or the managing underwriters so
request in connection with any underwritten registration of the
Company' securities, will not, without the prior written consent of the
Company or such underwriters, effect any sale of the Registrable
Securities to the public pursuant to a public offering or otherwise or
other distribution of any equity securities of the Company, including
any sale pursuant to Rule 144 (each of the foregoing, a "Prohibited
Sale"), during the seven (7) days prior to, and during the one hundred
eighty (180) day period commencing on, the effective date of such
underwritten registration, except in connection with such underwritten
registration; provided, that the foregoing shall not apply to restrict
the sale by any stockholders who together with any of its Affiliates,
as such term is defined in the Securities Act, holds less than two
percent (2%) of the Common Stock on a fully diluted basis.
(b) The Company agrees not to effect any Prohibited Sale or
other distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such equity
securities, during the period commencing on the seventh day prior to,
and ending on the one hundred eightieth (180th) day following, the
effective date of any underwritten Demand or Piggyback Registration,
except in connection with any such underwritten registration and except
for any offering pursuant to an employee benefit plan and registered on
Form S-8 (or any successor form).
ARTICLE IV
MISCELLANEOUS
4.01 Notices. All notices and other communications provided for or
permitted hereunder shall be made in accordance with the notice provisions
contained in Section 8.03 of the Purchase Agreement.
4.02 Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of the Company. No rights
under this Agreement may be assigned by the Holder without the prior written
consent of the Company.
4.03 Counterparts. This Agreement may be executed in multiple
counterparts (including facsimile counterparts), each of which shall be deemed
an original, and all of which together shall constitute the same instrument, but
only one of which need be produced.
B-8
4.04 GOVERNING LAW; VENUE. NOTWITHSTANDING THE PLACE WHERE THIS
AGREEMENT MAY BE EXECUTED BY ANY OF THE PARTIES HERETO, THE PARTIES EXPRESSLY
AGREE THAT THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF
THE STATE OF DELAWARE AS APPLIED TO AGREEMENTS AMONG DELAWARE RESIDENTS ENTERED
INTO AND TO BE PERFORMED ENTIRELY WITHIN DELAWARE, WITHOUT REGARD TO THE
CONFLICT OF LAW PROVISIONS OF SUCH JURISDICTION. VENUE FOR ANY ACTION TO
ENFORCE, INTERPRET, OR RESOLVE ANY DISPUTE WITH RESPECT TO ANY PROVISION OF THIS
AGREEMENT SHALL BE EXCLUSIVELY IN ▇▇▇▇▇▇ COUNTY, MISSOURI, AND ALL PARTIES
HERETO AGREE THAT ANY LITIGATION DIRECTLY OR INDIRECTLY RELATING TO THIS
AGREEMENT MUST BE BROUGHT BEFORE AND DETERMINED BY A COURT OF COMPETENT
JURISDICTION WITHIN SUCH COUNTY AND STATE. EACH OF THE PARTIES FURTHER
ACKNOWLEDGE THAT SUCH VENUE IS APPROPRIATE AND AGREE NOT TO RAISE ANY ARGUMENT
THAT SUCH VENUE IS IN ANY WAY UNDULY INCONVENIENT FOR ANY OF THEM, WITH THEIR
EXECUTION HEREOF BEING EVIDENCE OF THEIR AGREEMENT TO SUBMIT TO THE JURISDICTION
OF SUCH COURTS.
4.05 Amendments and Modifications. Upon the written consent of the
Holder, compliance with any of the provisions, covenants and conditions set
forth in this Agreement may be waived, or any of such provisions, covenants or
conditions may be modified. No course of dealing between the Holder or the
Company and any other party hereto or any failure or delay on the part of the
Holder or the Company in exercising any rights or remedies under this Agreement
shall operate as a waiver of any rights or remedies of the Holder or the
Company. No single or partial exercise of any rights or remedies under this
Agreement by a party shall operate as a waiver or preclude the exercise of any
other rights or remedies hereunder or thereunder by such party.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first written above.
COMPANY:
DECORIZE, INC.,
a Delaware corporation
By:
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and CFO
HOLDER:
QUEST CAPITAL ALLIANCE, L.L.C.
a Missouri limited liability company
By:
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇
Title: General Manager
B-10
EXHIBIT C
Form of Warrant
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER ANY STATE SECURITIES LAWS. THESE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED EXCEPT
PURSUANT TO REGISTRATION UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, OR
UPON RECEIPT BY THE COMPANY OF AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.
WARRANT CERTIFICATE
For Purchase of Warrant Shares
of
DECORIZE, INC.
November 19, 2002
THIS CERTIFIES THAT, for value received, Quest Capital Alliance,
L.L.C., a Missouri limited liability company, whose address is ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or its registered transferees or assigns,
is entitled, subject to the terms and conditions hereinafter set forth, to
purchase from Decorize, Inc., a Delaware corporation (the "Company"), 357,143
fully paid and nonassessable Warrant Shares (such number of Warrant Shares shall
hereafter be referred to as the "Exercise Number"). This Warrant is (which,
together with all Warrants issued in exchange, transfer or replacement of any
thereof, are referred to herein as the "Warrants") issued pursuant to that
certain Securities Purchase Agreement dated as of November 19, 2002 (the
"Agreement"), between the Company and Purchaser (as defined therein), and shall
be entitled to the rights set forth therein. Unless otherwise defined herein,
capitalized terms used in this Warrant shall have the meanings given to such
terms in the Agreement.
This Warrant may be exercised by presentation and surrender of this
Warrant Certificate, together with (i) a completed and executed Election to
Purchase in the form attached as Annex I hereto, at any time during the Exercise
Period (as hereinafter defined), at the principal office of the Company or at
such other office as shall have been theretofore designated by the Company by
notice pursuant hereto, and (ii) payment to the Company of the applicable
purchase price, as hereinafter set forth. In certain contingencies provided for
below, the number of Warrant Shares subject to purchase hereunder or the
purchase price thereof are subject to adjustment.
This Warrant is subject to the following terms and conditions:
1. Exercise of Warrant.
(a) The purchase rights which are represented by this Warrant
are exercisable at the option of the holder hereof, in whole at any
time, or in part from time to time (but not as to a fractional share of
Common Stock), during the Exercise Period. In the case of the purchase
of, or the surrender of rights to purchase, less than all the shares
purchasable under this Warrant, the Company shall cancel this Warrant
upon the surrender hereof and shall execute and deliver a new Warrant
of like tenor for the balance of the shares purchasable hereunder.
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(b) The term "Exercise Period" shall mean and refer to a
period commencing on the date hereof and ending at midnight, central
time, on the date that is three (3) years from the date hereof.
2. Price. The purchase price of each Warrant Share purchasable pursuant
to the exercise of this Warrant (the "Exercise Price") shall be $2.80, subject
to adjustment as set forth herein, payable by bank check or wire transfer of
same day funds. Notwithstanding the foregoing, upon exercise of this Warrant,
the holder may deliver in payment of a portion or all of the Warrant Shares,
certain of the Warrant Shares issuable upon exercise of the Warrant, which shall
be valued at the fair market value of such stock on the date of exercise of the
Warrant. For purposes of this Warrant, "fair market value" of such shares shall
equal the amount established by mutual agreement of the Warrant holder and the
Company, and if no such agreement is reached, then the appraised value of the
Warrant Shares, without reduction for any discount, minority or otherwise.
3. Anti-Dilution Provisions. The Exercise Price in effect at any time
and the number of Warrant Shares and kind of securities purchasable upon the
exercise of this Warrant shall be subject to adjustment from time to time upon
the happening of any of the following events:
(a) In case at any time the Company shall subdivide its
outstanding shares of Common Stock into a greater number of shares, the
Exercise Price in effect immediately prior to such subdivision shall be
proportionately reduced. In case at any time the outstanding shares of
Common Stock of the Company shall be combined into a smaller number of
shares, the Exercise Price in effect immediately prior to such
combination shall be proportionately increased.
(b) In case of any reclassification, capital reorganization or
other change of outstanding shares of Common Stock, or in case of any
consolidation, merger or other business combination of the Company with
or into another corporation or other entity (other than a merger with a
subsidiary in which merger the Company shall be the continuing
corporation and which shall not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock of
the class issuable upon conversion of this Warrant) or in case of any
sale, lease or conveyance to another corporation or other entity of all
or substantially all of the assets of the Company, the Company shall
cause effective provisions to be made so that the holder of this
Warrant, upon exercise of the Warrant Shares receivable upon the
exercise of all Warrant Shares at any time after the consummation of
such reclassification, change, consolidation, merger, sale, lease or
conveyance, shall be entitled to receive for such shares of Common
Stock the stock or other securities or property to which the holder of
this Warrant would have been entitled upon such consummation if such
Conversion Stock had been converted into shares of Common Stock
immediately prior to such consummation. Any such provision shall
include provisions for adjustments that shall be as nearly equivalent
as may be practicable to the adjustments provided for in this Warrant.
The foregoing provisions of this paragraph (b) shall similarly apply to
successive reclassifications, capital reorganizations and changes of
shares of Common Stock and to successive consolidations, mergers,
sales, leases or conveyances. In the event that, in connection with any
such capital reorganization or reclassification, consolidation, merger,
sale, lease or conveyance, additional shares of Common Stock shall be
issued in exchange, conversion, substitution or payment, in whole or in
part, for a security of the Company other than Common Stock, any such
issue shall be treated as an issue of Common Stock subject to the
provisions of this Section 3.
4. Elimination of Fractional Interests. The Company shall not be
required to issue certificates representing fractions of Warrant Shares, but
will make a payment in cash based on the Exercise Price in effect at that time.
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5. Exchange and Replacement of Warrant. This Warrant is exchangeable,
upon the surrender hereof by the registered holder at the principal office of
the Company, for new Warrants of like tenor and date representing the right to
purchase the number of shares purchasable hereunder, registered in such names as
requested by such holder (subject to the approval and consent of the Company),
each of such new Warrants to represent the right to purchase such number of
shares as shall be designated by said registered holder at the time of such
surrender. Upon receipt by the Company of (a) evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant and, in case
of loss, theft or destruction, and (b) indemnity or security reasonably
satisfactory to it, and upon surrender and cancellation of this Warrant, if
mutilated, the Company will make and deliver a new Warrant of like tenor, in
lieu of this Warrant.
6. Rights Prior to Exercise of Warrant. Prior to the exercise of this
Warrant, the holder of this Warrant shall not, by reason of this Warrant or the
shares underlying this Warrant, be entitled to any rights of a stockholder of
the Company, including without limitation the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights and shall
not thereby be entitled to receive any notice of any proceedings of the Company,
except as specifically provided herein.
7. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be mailed by first class registered or
certified mail, postage prepaid, at such address as may have been furnished to
the Company in writing by such holder or, until any such holder furnishes to the
Company an address, then to, and at the address of, the last holder of this
Warrant who has so furnished an address to the Company.
8. Transferability; Successors. This Warrant may not be transferred,
sold or assigned without the prior written consent of the Company, which may be
withheld in its sole discretion. The terms of this Warrant shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
executors, personal representatives, successors and assigns and shall be binding
upon any person, firm, corporation or other entity to whom this Warrant and any
shares of Common Stock issuable upon exercise hereof are assigned or transferred
(even if in violation of the provisions of this Warrant) and the heirs,
executors, personal representatives, successors and assigns of such person,
firm, corporation or other entity.
9. Amendment and Waiver. Any changes in or additions to this Warrant
may be made, and compliance with any covenant or provision herein set forth may
be waived, only if the Company shall obtain consent thereto in writing from the
holder of this Warrant. Any waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
10. Governing Law; Venue. This Warrant shall be construed in accordance
with and be governed by the laws of the State of Delaware without regard to its
conflict of laws provisions. Venue for any dispute or proceeding with respect to
this Warrant shall be exclusively in the state and federal courts of ▇▇▇▇▇▇
County, Missouri.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
and delivered as an instrument under seal and as of the date first above
written.
DECORIZE, INC.,
a Delaware corporation
By:
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and CFO
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ANNEX I
ELECTION TO PURCHASE
TO: DECORIZE, INC.
The undersigned owner of the accompanying Warrant hereby irrevocably
exercises the option to purchase 357,143 Warrant Shares in accordance with the
terms of such Warrant, directs that the Warrant Shares issuable and deliverable
upon such purchase (together with any check for a fractional interest) be issued
in the name of and delivered to the undersigned, and makes payment in full
therefor at the Exercise Price provided in such Warrant.
COMPLETE FOR REGISTRATION OF WARRANT SHARES ON THE STOCK TRANSFER
RECORDS MAINTAINED BY THE COMPANY:
QUEST CAPITAL ALLIANCE, L.L.C.
a Missouri limited liability company
By:
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇
Title: General Manager
Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Manager
-------------------------------------------
Social Security or Other Identifying Number
Date: ____________________, 20___
C-5
EXHIBIT E
Opinion of ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C.
November 19, 2002
Quest Capital Alliance, L.L.C.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Manager
Gentlemen:
We have acted as counsel to Decorize, Inc., a Delaware corporation (the
"Company") in connection with the execution and delivery of the Securities
Purchase Agreement dated as of November 19, 2002 (the "Purchase Agreement")
between the Company and Quest Capital Alliance, L.L.C., a Missouri limited
liability company ("Purchaser"), pursuant to which the Company is issuing and
selling the Shares and Warrants. This opinion is provided to you pursuant to
Section 6.06 of the Purchase Agreement. Capitalized terms used herein and not
otherwise defined herein shall have the meanings ascribed to them in the
Purchase Agreement.
We have examined the Purchase Agreement, the Shares, the Warrants and
the other Closing Documents. We have also reviewed originals or copies of such
corporate records of the Company, public records, agreements and other
instruments, certificates of public officials, certificates of officers and
representatives of the Company and such other documents as we have deemed
relevant in connection with the rendering of this opinion. As to various
questions of fact material to our opinion, we have relied upon the
representations of the officers of the Company and other appropriate persons,
and the representations and warranties of the Company and the Purchaser
contained in the Purchase Agreement, without investigating the factual
representations contained therein. Notwithstanding the foregoing, as of the date
hereof, no information has come to our attention that would give us actual
knowledge of any facts that would be contrary to such statements contained
herein.
Based upon the foregoing, and subject to the exceptions and
qualifications hereinafter stated, it is our opinion that:
1. The Company (i) is a corporation, validly existing and in good
standing under the laws of the State of Delaware; (ii) is duly qualified as a
foreign corporation and is in good standing under the laws of each jurisdiction
listed on Schedule A hereto; (iii) has the requisite corporate power and
authority to own or lease and to operate its properties, and to conduct its
current business as described in the SEC Documents; and (iv) has all requisite
corporate power and authority to enter into and perform its obligations under
the Closing Documents.
2. Upon issuance in compliance with the terms of the Closing Documents,
all of the Shares will be duly authorized, validly issued, fully paid and
non-assessable. As of the Closing Date, the Company has reserved a sufficient
number of shares of Common Stock necessary for issuance as Warrant Shares. All
such shares of Common Stock will, upon issuance after exercise of the Warrants
in compliance with the terms of the Closing Documents, be duly authorized,
validly issued, fully paid and non-assessable.
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3. The Purchase Agreement and each other Closing Document to which the
Company is a party have been duly authorized by all necessary corporate action,
duly executed and delivered by or on behalf of the Company, and constitute the
legal, valid and binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, except that (a) the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, or other similar laws now or hereafter in effect relating to
creditors' rights generally, and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be brought and
(b) any rights to indemnity or contribution thereunder may be limited by federal
and state law and public policy considerations.
4. The execution, delivery and performance by the Company of the
Purchase Agreement and the other Closing Documents to which the Company is a
party and the consummation by the Company of the transactions contemplated
thereby, including, without limitation, the issuance of the Securities, does not
and will not (a) constitute or result in a material default under or material
breach or violation of (i) any term or provision of the Certificate of
Incorporation or bylaws of the Company or (ii) to our knowledge, material
contracts or instruments known to us to which the Company or any of its
subsidiaries is a party (which contracts and instruments are listed on Schedule
B hereto) or (iii) assuming the Company's compliance with all applicable state
securities or "Blue Sky" laws and assuming the accuracy of the representations
and warranties of Purchaser in the Purchase Agreement, any provision of any law,
rule or regulation or any judgment, order or decree applicable to the Company or
any of its subsidiaries and their respective assets, which, in our experience,
is normally applicable both to general business corporations that are not
engaged in regulated business activities and to transactions of the type
contemplated by the Closing Documents (but without our having made any special
investigation as to other laws); (b) to our knowledge, result in the
acceleration or termination of any rights under any material contract or
instrument known to us to which the Company or any of its subsidiaries is a
party (which contracts and instruments are listed on Schedule B hereto); or (c)
to our knowledge, result in the creation or imposition of any liens, charges or
encumbrances upon any assets of the Company or any of its subsidiaries.
5. To our knowledge, no approval, consent, order, authorization of or
designation, declaration or filing with any governmental authority or regulatory
agency or any other person or entity, and no lapse of a waiting period, is
required in connection with the valid execution, delivery or performance by the
Company of the Purchase Agreement, any other Closing Document, the issuance and
delivery of the Securities or any other transactions contemplated by any of the
Closing Documents, except as may be required under applicable state securities
or "Blue Sky" laws, as to which we express no opinion.
6. To our knowledge, except as set forth in the disclosure schedules to
the Purchase Agreement, no action, suit, proceeding, inquiry or investigation is
now pending or threatened against the Company or any of its subsidiaries, or any
of their respective directors or officers, in their capacities as such, at law,
in equity or otherwise, before any court, board, commission, agency or
instrumentality of any federal, state, or local government, or of any agency or
subdivision thereof, or before any arbitrator or panel of arbitrators, (a)
which, if determined adversely, could result in a Material Adverse Change or (b)
questions the validity, enforceability or the authority of the Company to
perform its obligations under the Purchase Agreement or any other Closing
Document to which the Company is a party or any action taken or to be taken
pursuant thereto. To our knowledge, the Company is not a party or subject to the
provisions of any order, writ, injunction, judgment, stipulation or decree of
any court, administrative agency, commission, regulatory authority, other
government agency or instrumentality.
7. The offering, sale and delivery of the Securities by the Company in
the manner contemplated by the Purchase Agreement, assuming the accuracy of the
representations and warranties of Purchaser in the Purchase Agreement,
constitute transactions that are exempt from the registration requirements of
the Securities Act.
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The opinions expressed herein are subject to the following exceptions,
limitations and qualifications:
A. The words "to our knowledge" or "known to us" with reference to
matters of fact mean that considering the actual knowledge of those attorneys in
our firm who have given substantive attention to the transactions contemplated
by the Closing Documents, but not including any independent investigation or any
constructive or imputed notice of any information, we find no reason to believe
that the opinions expressed herein are factually incorrect. Beyond that, we have
made no independent factual investigation for the purpose of rendering an
opinion with respect to such matters.
B. We have assumed that the Purchase Agreement and the other Closing
Documents executed in connection therewith by Purchaser have been duly
authorized, executed and delivered on each of their behalf and are legally
binding upon and enforceable against Purchaser to the extent that each such
document purports to be.
C. With respect to the opinions expressed in Paragraphs 4 and 6, we
have not conducted any search of any indexes, dockets or other records of any
federal, state or local court, administrative agency or body or of any
arbitrator, and have relied, with respect to factual matters, solely upon the
representations of the officers of the Company.
D. We are members of the Bar of the State of Texas only, and do not
purport to be experts on, generally familiar with, or qualified to express legal
conclusions based on, laws of states other than the State of Texas, the
corporate laws of the State of Delaware and the federal securities laws.
E. We have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals, the conformity to authentic
originals of all documents submitted to us as copies and the accuracy of all
factual recitations contained in certificates or similar documents examined by
us.
F. The opinions expressed in Paragraph 1 regarding the existence and
good standing of the Company are rendered solely on the basis of certificates
issued by the appropriate Secretaries of States in which the Company is
qualified to do business as a foreign corporation, as the case may be.
G. The opinions expressed in Paragraphs 3 and 4 are subject to (i) the
General Qualifications set forth in the Legal Opinion Accord of the ABA Section
of Business Law (1991), and (ii) the Other Common Texas Qualifications set forth
in the Report of the Legal Opinions Committee Regarding Legal Opinions in
Business Transactions (June 1, 1992) of the Business Law Section of the State
Bar of Texas, a copy of which qualifications are attached as Schedule C to this
opinion letter. Further, the indemnification and contribution provisions of the
Closing Documents may be subject to or limited by federal and state securities
laws and public policy embodied therein or related thereto.
The opinions expressed herein are limited to the matters specifically
addressed, and no opinion is implied or may be inferred beyond the matters so
specifically addressed.
The opinions expressed in this letter are based upon the law in effect
on the date hereof, and we assume no obligation to revise or supplement this
opinion should such law be changed by legislative action, judicial decision or
otherwise.
This opinion is being furnished to you solely for your benefit and only
with respect to the transactions recited herein. Accordingly, it may not be
relied upon by, or quoted in any manner or delivered to, any person or entity
without, in each instance, our prior written consent.
Very truly yours,
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