2005 Credit Facility Agreement
Between
Calypte Biomedical Corporation and ▇▇▇▇ Technologies, BV
Securities: 9% Notes, each with term as specified in Section II.c
below (the "Note(s)") of the Issuer
Issuer: Calypte Biomedical Corporation (the "Issuer" or the
"Company")
AMEX: HIV
Purchaser: ▇▇▇▇ Technologies, B.V.
Commitment Amount: $5,500,000
Use of Proceeds: General Corporate Purposes
I. Terms of Note Issuance
a. Note Issuance: Beginning on the Effective Date and continuing
through December 31, 2005, the Issuer may issue Notes, in its sole
discretion (each, a "Note"), which the Purchaser shall be obligated
to accept, with an aggregate total not to exceed the Commitment
Amount. Issuer may issue only one Note within any 30 day period.
b. Issuance Notice: The Issuer shall indicate its intention to issue a
Note by delivering to the Purchaser an Issuance Notice (each, an
"Issuance Notice") via facsimile transmission. The Issuance Notice
shall specify:
(i) The amount of the Note (the "Note Amount");
(ii) The date on which the Note is to be effective and funded,
which shall be no sooner than 4 business days from the date of
the Issuance Notice. If the Issuer wishes the Note to be
funded on the fourth business day, the Issuance Notice must be
delivered to the Purchaser and such receipt confirmed, before
8:30 a.m. ET.
(iii) A form of Issuance Notice is attached hereto as Exhibit B.
c. Note Amount: The Note Amount shall be a minimum of $500,000 in any
single issuance and the maximum Note Amount shall be $1,500,000.
d. The members of the Company's Board of Directors shall, by vote at a
duly-noticed meeting or by written consent, unanimously approve the
Company's issuance of any Note under the Agreement.
II. Settlement
a. Settlement: Within 24 hours of the Issuer's transmission of the
Issuance Notice to the Purchaser, Purchaser shall confirm receipt
thereof. Once the Purchaser confirms the receipt of the Issuance
Notice, Purchaser shall have 3 business days in which to purchase
the Note by wire transfer of immediately available funds to the
Issuer's designated account. At the election of either party, an
escrow agent may be used.
b. Note Agreement: Each Note issued pursuant to an Issuance Notice
under this Agreement shall be evidenced by a Note substantially in
the form of Exhibit A hereto and shall be executed by authorized
representatives of both Purchaser and Issuer.
c. Term of Note. Each Note issued under the terms of this Agreement
shall have a term of 12 months, except that any Note(s) outstanding
at the expiration of this Agreement shall be immediately due and
payable. Each Note shall be repaid upon maturity by wire transfer of
immediately available funds to the Purchaser's designated account.
d. Interest. Interest shall accrue at 9% per annum on any Notes issued
under the terms of this Agreement and shall be paid in cash upon the
maturity of the Note. Any amount of principal or interest due in
respect of a Note which is not paid on its due date shall bear
interest from the due date until payment (as well after as before
judgment) at a rate of 11% per annum.
III. General Conditions
a. Effective Date: The Effective Date of this agreement shall be
April 4, 2005.
b. Expiration of Agreement. This agreement shall terminate on 31 May
2006.
c. Subsequent Financings: During the term of this Agreement, Issuer
will notify Purchaser of all offerings for equity financing which it
may undertake. Equity financings shall, for the purposes of this
Agreement, be defined as cash received by Issuer from the sale of
Issuer's common stock, $0.03 par value, or such other equity
security or other security convertible into shares of Issuer's
common stock as it may offer from time to time, for cash,
specifically excluding (i) shares of Common Stock or Common Stock
Equivalents to consultants, employees, officers, or directors of the
Company, as compensation for their services to the Company or any of
its direct or indirect Subsidiaries pursuant to arrangements
approved by the Board of Directors of the Company and consistent
with past practice, (ii) the issuance of the Securities pursuant to
the 8% Convertible Notes and related warrants transaction documents,
(iii) shares of Common Stock issued and sold in a firm commitment
underwritten public offering (which shall not include an equity line
of credit, shelf takedown, or similar financing arrangement)
resulting in net proceeds to the Company of in excess of
$15,000,000, (iv) up to 250,000 shares of Common Stock or Common
Stock Equivalents issuable in connection with an equipment financing
by Vencore Solutions LLC, (v) issuance of shares of Common Stock to
Logisticorp, Inc., and Southwest Resource Preservation, Inc., or
their successors and assigns, based upon the issuance and conversion
of outstanding convertible debentures, with the issuance of said
Common Stock not to exceed 700,000 shares, (vi) shares of Common
Stock issued as consideration for the acquisition of another company
or business in which the shareholders of the Company do not have an
ownership interest, which acquisition has been approved by the Board
of Directors of the Company, (vii) shares of Common Stock issued in
connection with Anti-Dilution Entitlements or New Entitlements (each
as defined in the Amendment to Securities Purchase Agreement dated
on or about the date hereof), or (viii) shares of Common Stock or
Common Stock Equivalents issued in connection with Strategic
Transactions, which shall be defined as a transaction or
relationship in which the Company issues shares of Common Stock or
other securities of the Company to a Person which is, itself or
through its subsidiaries, an operating company in a business
synergistic with the business of the Company and in which the
Company receives benefits in addition to the investment of funds,
but shall not include a transaction in which the Company is issuing
securities primarily for the purpose of raising capital or to an
entity whose primary business is investing in securities. Strategic
Transaction includes bona fide equipment or real property leases,
sale and leaseback, or licensing agreements, provided that such
transaction is approved by the Board of Directors of the Company and
is not for the purpose of raising capital.
.i. Issuer will grant Purchaser the right of first refusal to
participate in any such subsequent equity financings on the
same key terms and conditions, which shall include the dollar
investment amount or number of shares to be purchased,
pricing, number of warrants and their terms, if any,
registration rights and fees, as applicable to the subject
offer. Purchaser shall inform Issuer of its decision to
participate in any subsequent equity financing within two
business days of notice from Issuer. Such right shall
terminate on the later of (a) 31 December 2005 or (b) the last
date on which a Note is outstanding under this Agreement.
ii. Regardless of Purchaser's election to participate in any such
subsequent equity financings, the Total Note Purchase
Commitment under this Agreement shall be decreased dollar for
dollar by the net amount of such subsequent equity financing
completed by Issuer after the closing of the 8% Senior
Convertible Note financing.
e. Issuance of Warrant. As a fee for the Note purchase commitment
evidenced by this Agreement, Issuer agrees to grant, on the
Effective Date, a warrant to purchase 500,000 shares of its common
stock, $0.03 par value, at a price of $0.40 per share, but in no
case less than the closing trade price of Issuer's Common Stock on
the Effective Date. The warrant shall be exercisable beginning six
months following the grant date and shall have a term of five years
from the Effective Date.
The Warrant shall be issued to:
▇▇▇▇ Technologies BV
Strawinskylaan 1431
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
or to such other party as may be directed by Purchaser. A form
of warrant is attached as Exhibit C.
f. Non-utilization of Commitment. No utilization of this Credit
Facility may be made if, at the time the Issuance Notice is tendered
to Purchaser or at the time the Note is issued, an event of default
or an event which, with the giving of notice or lapse of time or
both, would constitute an event of default (the "Event of Default")
has occurred and is continuing or would result from such utilization
of this facility.
g. Events of Default. Purchaser may, without prejudice to its other
rights hereunder, terminate its obligation to purchase the Notes and
declare all outstanding amounts owing to Purchaser pursuant to Notes
issued under this Agreement, together with all accrued interest and
such other payments payable under this Agreement, immediately due
and payable at any time after any of the following events shall have
occurred:
i. The Issuer defaults in the due performance or observance of
any of its obligations under this agreement and, if such
default is, in the opinion of the Purchaser, capable of
remedy, such default shall not have been remedied within 14
days of the Purchaser notifying the Issuer of such default; or
ii. Any judgment or order of a court of competent jurisdiction in
an amount exceeding $10,000 made against the Issuer is not
stayed or complied with within 21 days or if an encumbrancer
takes possession of the whole or part of the assets, rights,
or revenues of the Issuer or a distress or other process is
levied or enforced upon any of the assets, rights or revenues
of the Issuer and is not discharged within 21 days; or
iii. The Issuer is adjudicated and found insolvent or any step is
taken or proceedings are commenced for the winding-up,
administration, liquidation, restructuring or dissolution of
the Issuer or for the appointment of a liquidator, trustee in
bankruptcy, receiver or similar officer in respect of the
Issuer or the whole or any part of its assets, rights, or
revenues; or
iv. The Issuer is, or has been deemed to be, unable to, or admits
inability to, pay its debts as they come due or it commences
negotiations with one or more if its creditors with a view to
the general rescheduling of all or any of its debts or
proposes or enters into any composition or other arrangement
for the benefit of its creditors generally, or of any class
thereof; or
v. The common stock of the Issuer ceases to be listed on the
American Stock Exchange; or
vi. Any other event occurs or circumstance arises which is likely
to have a material adverse effect on the business or financial
condition of the Issuer.
This agreement is executed and binding as of the last date executed by the
signers below..
The remainder of this page is intentionally left blank.
Calypte Biomedical Corporation
("Issuer") A Delaware Corporation
By:________________________________
Title: ______________________________
Date: ______________________________
▇▇▇▇ Technologies, B.V.
("Purchaser")
By:________________________________
Title: ______________________________
Date: ______________________________
EXHIBIT A
FORM OF PROMISSORY NOTE
$_____________
[Date]
Pleasanton, California
FOR VALUE RECEIVED, Calypte Biomedical Corporation, a Delaware corporation
(the "Borrower") promises to pay to the order of ▇▇▇▇ Technologies, B.V. (the
"Payee"), the principal amount of ____________________________________ and
No/100 Dollars ($__________.00) ("Principal"). The unpaid Principal due under
this Note shall bear interest from the date hereof until paid, computed at a
rate equivalent of 9% per annum (computed on the basis of a 360-day year and
actual days elapsed).
This Note shall be payable in full twelve months from the date hereof, or
on May 31, 2006, if earlier (the "Maturity Date"). All accrued interest on the
entire unpaid principal shall likewise be due on the Maturity Date. Any amount
of principal or interest due in respect of a Note which is not paid on its due
date shall bear interest from the due date until payment (as well after as
before judgment) at a rate of 11% per annum
Payment of the Principal and interest shall be made in lawful money of the
United States in the form of a wire transfer of immediately available funds to
an account specified by Payee or at such other place as Payee may from time to
time direct in writing. Payee shall be entitled to assign its rights hereunder,
and in the event of such assignment, any references to "Payee" herein shall
include such subsequent holder or holders.
No delay on the part of the Payee in exercising any right under this Note,
or other undertaking securing or affecting this Note shall operate as a waiver
of such right or any other right, nor shall any omission in exercising any right
on the part of the Payee under this Note. In the event this Note is not paid
when due, the Borrower shall pay all costs of collection, including, without
limitation, reasonable attorneys' fees.
All notices and other communications hereunder shall be in writing and
shall be deemed received (1) upon receipt or refusal thereof, if delivered
personally or via overnight courier service, or (2) upon receipt by the sender
of transmission confirmation, if delivered via facsimile. Notice to either party
hereto, if faxed or sent by overnight courier service, shall be to the following
addresses:
If to the Payee, to: If to the Borrower, to:
▇▇▇▇ Technologies, BV Calypte Biomedical Corporation
Strawinskylaan 1431 ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ Amsterdam ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Netherlands Attention: Executive Vice President
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and CFO
Facsimile: Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Any party may change their address for notice by giving all other parties notice
of such change pursuant to this paragraph.
At the option of the Borrower, all or any portion of the Principal and
accrued interest due on this Note may be otherwise prepaid without premium or
penalty, the amount of the prepayment to be applied first to accrued interest
and the remainder to any unpaid balance of Principal.
This Note and the rights and obligations of the parties hereto shall be
governed by and construed in accordance with the laws of the State of Delaware,
without regard to the conflicts of laws principles of the State of Delaware. All
rights of Payee hereunder shall inure to the benefit of its successors and
assigns, and all obligations of the Borrower shall bind its successors and
assigns; provided, however, that this Note and the Borrower's obligations
hereunder shall not be assignable by the Borrower without the prior written
consent of Payee. The Borrower hereby waives presentment, demand, protest,
notice of dishonor and/or protest, notice of nonpayment and all other notices
and demands, and assents to the extension of the time of payment, forbearance or
other indulgence, without notice.
To induce Payee to accept this Note, the Borrower irrevocably agrees that,
subject to Payee's sole and absolute election, all actions or proceedings, in
any way, manner or respect, arising out of or from or related to this Note shall
be litigated in courts having situs within the City of Wilmington, State of
Delaware. The Borrower hereby consents and submits to the jurisdiction of any
local, state or federal court located within said City and State. The Borrower
hereby waives any right it may have to transfer or change the venue of any
litigation brought against the Borrower by Payee in accordance with this
paragraph, and the Borrower hereby specifically waives any right to assert the
doctrine of forum non conveniens.
THE BORROWER IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY ACTION,
SUIT, COUNTERCLAIM, OR PROCEEDING (I) TO ENFORCE OR DEFEND ANY RIGHTS UNDER OR
IN CONNECTION WITH THIS NOTE OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH, OR
(II) ARISING FROM ANY DISPUTE OR CONTROVERSY IN CONNECTION WITH OR RELATED TO
THIS NOTE OR ANY SUCH AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT, AND AGREES
THAT ANY SUCH ACTION, SUIT COUNTERCLAIM OR PROCEEDING SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY.
All of Payee's rights and remedies under this Note are cumulative and
non-exclusive. The acceptance by Payee of any partial payment made hereunder
after the time when any of the Borrower's liabilities become due and payable
will not establish a custom or waive any rights of Payee to enforce prompt
payment hereof. Payee's failure to require strict performance by the Borrower of
any provision of this Note shall not waive, affect or diminish any right of
Payee thereafter to remain in strict compliance and performance herewith.
IN WITNESS WHEREOF, Calypte Biomedical Corporation has executed and
delivered this Promissory Note the day and year first written above.
CALYPTE BIOMEDICAL CORPORATION
By:
------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Executive Vice President
and Chief Financial Officer
Exhibit B
Form Of
ISSUANCE NOTICE
Calypte Biomedical Corporation
The undersigned hereby certifies, with respect to a 9% Note of
Calypte Biomedical Corporation (the "Company") issuable in connection
with this Issuance Notice dated __________________ (the "Issuance
Notice"), delivered pursuant to the 2005 Credit Facility Agreement
dated as of April 4, 2005 (the "Agreement"), as follows:
1. The undersigned is the duly appointed _________________ of
the Company.
2. The Note Amount is $____________.
3. The Settlement Date shall be _________, 2005.
The undersigned has executed this Notice this ___th day of ___________ 2005.
CALYPTE BIOMEDICAL CORPORATION
By:
-----------------------------
Name:
Title:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED ("1933 ACT"), OR ANY STATE SECURITIES LAWS AND SHALL NOT
BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED, WHETHER OR
NOT FOR CONSIDERATION, BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF
A FAVORABLE OPINION OF ITS COUNSEL OR THE SUBMISSION TO THE COMPANY OF SUCH
OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL FOR THE COMPANY, IN EITHER
CASE, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE 1933
ACT AND APPLICABLE STATE SECURITIES LAWS.
CALYPTE BIOMEDICAL CORPORATION
Common Stock Purchase Warrant
to
Purchase 500,000 Shares
of
Common Stock
Original Issue Date: Apirl 4, 2005
This Common Stock Purchase Warrant is issued to:
▇▇▇▇ Technologies BV
Strawinskylaan 1439
1077XX Amsterdam, The Netherlands
by CALYPTE BIOMEDICAL CORPORATION, a Delaware corporation (hereinafter called
the "Company", which term shall include its successors and assigns).
FOR VALUE RECEIVED and subject to the terms and conditions hereinafter set
out, the registered holder of this Warrant as set forth on the books and records
of the Company (the "Holder") is entitled upon surrender of this Warrant to
purchase from the Company 500,000 fully-paid and non-assessable shares of Common
Stock, $0.03 par value per share (the "Common Stock"), at the Exercise Price (as
defined below) per share.
This Warrant shall expire at the close of business on April 3, 2010.
1. (a) The right to purchase shares of Common Stock represented by this
Warrant may be exercised by the Holder, in whole or in part, by the surrender of
this Warrant (properly endorsed if required) at the principal office of the
Company at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (or such
other office or agency of the Company as it may designate by notice in writing
to the Holder at the address of the Holder appearing on the books of the
Company), and upon payment to the Company, by cash or by certified check or bank
draft, of the Exercise Price for such shares. The Company agrees that the shares
of Common Stock so purchased shall be deemed to be issued to the Holder as the
record owner of such shares of Common Stock as of the close of business on the
date on which this Warrant shall have been surrendered and payment made for such
shares of Common Stock as aforesaid. Certificates for the shares of Common Stock
so purchased (together with a cash adjustment in lieu of any fraction of a
share) shall be delivered to the Holder within a reasonable time, not exceeding
five (5) business days, after the rights represented by this Warrant shall have
been so exercised, and, unless this Warrant has expired, a new Warrant
representing the number of shares of Common Stock, if any, with respect to which
this Warrant shall not then have been exercised, in all other respects identical
with this Warrant, shall also be issued and delivered to the Holder within such
time, or, at the request of the Holder, appropriate notation may be made on this
Warrant and the same returned to the Holder.
(b) This Warrant may be exercised to acquire, from and after the
date which is six months hereafter, the number of shares of Common Stock set
forth on the first page hereof (subject to adjustments described in this
Warrant); provided, however, the right hereunder to purchase such shares of
Common Stock shall expire at 5:00 p.m. Pleasanton, California time on April 3,
2010.
2. This Warrant is being issued by the Company pursuant to the terms of
the 2005 Credit Facility Agreement between Calypte Biomedical Corporation and
▇▇▇▇ Technologies BV.
3. The Company covenants and agrees that all Common Stock upon issuance
against payment in full of the Exercise Price by the Holder pursuant to this
Warrant will be validly issued, fully paid and non-assessable and free from all
taxes, liens and charges with respect to the issue thereof (except to the extent
resulting from the Holder's own circumstances, actions or omissions). The
Company covenants and agrees that during the period within which the rights
represented by this Warrant may be exercised, the Company will have at all times
authorized, and reserved for the purpose of issue or transfer upon exercise of
the rights evidenced by this Warrant, a sufficient number of shares of Common
Stock to provide for the exercise of the rights represented by this Warrant, and
will procure at its sole expense upon each such reservation of shares the
listing thereof (subject to issuance or notice of issuance) on all stock
exchanges on which the Common Stock is then listed or inter-dealer trading
systems on which the Common Stock is then traded. The Company will take all such
action as may be necessary to assure that such shares of Common Stock may be so
issued without violation of any applicable law or regulation, or of any
requirements of any national securities exchange upon which the Common Stock may
be listed or inter-dealer trading system on which the Common Stock is then
traded. The Company will not take any action which would result in any
adjustment in the number of shares of Common Stock purchasable hereunder if the
total number of shares of Common Stock issuable pursuant to the terms of this
Warrant after such action upon full exercise of this Warrant and, together with
all shares of Common Stock then outstanding and all shares of Common Stock then
issuable upon exercise of all options and other rights to purchase shares of
Common Stock then outstanding, would exceed the total number of shares of Common
Stock then authorized by the Company's Restated and Amended Articles of
Incorporation, as then amended.
4. The Initial Exercise Price is the greater of (i) $0.40 or (ii) the
quoted closing trade price on the Original Issue Date per share of Common Stock
("Initial Exercise Price"). The Initial Exercise Price shall be adjusted as
provided for below in this Section 4 (the Initial Exercise Price, and the
Initial Exercise Price, as thereafter then adjusted, shall be referred to as the
"Exercise Price") and the Exercise Price from time to time shall be further
adjusted as provided for below in this Section 4. Upon each adjustment of the
Exercise Price, the Holder shall thereafter be entitled to receive upon exercise
of this Warrant, at the Exercise Price resulting from such adjustment, the
number of shares of Common Stock obtained by (i) multiplying the Exercise Price
in effect immediately prior to such adjustment by the number of shares of Common
Stock purchasable hereunder immediately prior to such adjustment, and (ii)
dividing the product thereof by the Exercise Price resulting from such
adjustment. The Exercise Price shall be adjusted as follows:
(i) In the case of any amendment to the Company's Articles of
Incorporation to change the designation of the Common Stock or the rights,
privileges, restrictions or conditions in respect to the Common Stock or
division of the Common Stock, this Warrant shall be adjusted so as to provide
that upon exercise thereof, the Holder shall receive, in lieu of each share of
Common Stock theretofore issuable upon such exercise, the kind and amount of
shares, other securities, money and property receivable upon such designation,
change or division by the Holder issuable upon such exercise had the exercise
occurred immediately prior to such designation, change or division. This Warrant
shall be deemed thereafter to provide for adjustments, which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Section
4. The provisions of this Subsection 4(i) shall apply in the same manner to
successive reclassifications, changes, consolidations and mergers.
(ii) If the Company shall at any time subdivide its outstanding
shares of Common Stock into a greater number of shares of Common Stock, or
declare a dividend or make any other distribution upon the Common Stock payable
in shares of Common Stock, the Exercise Price in effect immediately prior to
such subdivision or dividend or other distribution shall be proportionately
reduced, and conversely, in case the outstanding shares of Common Stock shall be
combined into a smaller number of shares of Common Stock, the Exercise Price in
effect immediately prior to such combination shall be proportionately increased.
(iii) If any capital reorganization or reclassification of the
capital stock of the Company, or any consolidation or merger of the Company with
or into another corporation or other entity, or the sale of all or substantially
all of the Company's assets to another corporation or other entity shall be
effected in such a way that holders of shares of Common Stock shall be entitled
to receive stock, securities, other evidence of equity ownership or assets with
respect to or in exchange for shares of Common Stock, then, as a condition of
such reorganization, reclassification, consolidation, merger or sale (except as
otherwise provided below in this Section 4), lawful and adequate provisions
shall be made whereby the Holder shall thereafter have the right to receive upon
the exercise hereof upon the basis and upon the terms and conditions specified
herein, such shares of stock, securities, other evidence of equity ownership or
assets as may be issued or payable with respect to or in exchange for a number
of outstanding shares of such Common Stock equal to the number of shares of
Common Stock immediately theretofore purchasable and receivable upon the
exercise of this Warrant under this Section 4 had such reorganization,
reclassification, consolidation, merger or sale not taken place, and in any such
case appropriate provisions shall be made with respect to the rights and
interests of the Holder to the end that the provisions hereof (including,
without limitation, provisions for adjustments of the Exercise Price and of the
number of shares of Common Stock receivable upon the exercise of this Warrant)
shall thereafter be applicable, as nearly as may be, in relation to any shares
of stock, securities, other evidence of equity ownership or assets thereafter
deliverable upon the exercise hereof (including an immediate adjustment, by
reason of such consolidation or merger, of the Exercise Price to the value for
the Common Stock reflected by the terms of such consolidation or merger if the
value so reflected is less than the Exercise Price in effect immediately prior
to such consolidation or merger). Subject to the terms of this Warrant, in the
event of a merger or consolidation of the Company with or into another
corporation or other entity as a result of which the number of shares of common
stock of the surviving corporation or other entity issuable to holders of Common
Stock, is greater or lesser than the number of shares of Common Stock
outstanding immediately prior to such merger or consolidation, then the Exercise
Price in effect immediately prior to such merger or consolidation shall be
adjusted in the same manner as though there were a subdivision or combination of
the outstanding shares of Common Stock. The Company shall not effect any such
consolidation, merger or sale, unless, prior to the consummation thereof, the
successor corporation (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing such assets shall assume
by written instrument executed and mailed or delivered to the Holder, the
obligation to deliver to the Holder such shares of stock, securities, other
evidence of equity ownership or assets as, in accordance with the foregoing
provisions, the Holder may be entitled to receive or otherwise acquire. If a
purchase, tender or exchange offer is made to and accepted by the holders of
more than fifty (50%) percent of the outstanding shares of Common Stock, the
Company shall not effect any consolidation, merger or sale with the person
having made such offer or with any affiliate of such person, unless prior to the
consummation of such consolidation, merger or sale the Holder of this Warrant
shall have been given a reasonable opportunity to then elect to receive upon the
exercise of this Warrant the amount of stock, securities, other evidence of
equity ownership or assets then issuable with respect to the number of shares of
Common Stock in accordance with such offer.
(iv) In case the Company shall, at any time prior to exercise of this
Warrant, consolidate or merge with any other corporation or other entity (where
the Company is not the surviving entity) or transfer all or substantially all of
its assets to any other corporation or other entity, then the Company shall, as
a condition precedent to such transaction, cause effective provision to be made
so that the Holder of this Warrant upon the exercise of this Warrant after the
effective date of such transaction shall be entitled to receive the kind and
amount of shares, evidences of indebtedness and/or other securities or property
receivable on such transaction by a holder of the number of shares of Common
Stock as to which this Warrant was exercisable immediately prior to such
transaction (without giving effect to any restriction upon such exercise); and,
in any such case, appropriate provision shall be made with respect to the rights
and interest of the Holder of this Warrant to the end that the provisions of
this Warrant shall thereafter be applicable (as nearly as may be practicable)
with respect to any shares, evidences of indebtedness or other securities or
assets thereafter deliverable upon exercise of this Warrant. Upon the occurrence
of any event described in this Section 4(iv), the holder of this Warrant shall
have the right to (i) exercise this Warrant immediately prior to such event at
an Exercise Price equal to lesser of (1) the then Exercise Price or (2) the
price per share of Common Stock paid in such event, or (ii) retain ownership of
this Warrant, in which event, appropriate provisions shall be made so that the
Warrant shall be exercisable at the Holder's option into shares of stock,
securities or other equity ownership of the surviving or acquiring entity.
(v) Subsequent Equity Sales
(a) If the Company or any subsidiary thereof, as applicable, at any
time prior to the one year anniversary of the Original Issue Date,
shall issue shares of Common Stock or Common Stock Equivalents
(which shall mean any securities of the Company or any Subsidiary
which entitle the holder thereof to acquire Common Stock at any
time, including without limitation, any debt, preferred stock,
rights, options, warrants or other instrument that is at any time
convertible into or exchangeable for, or otherwise entitles the
holder thereof to receive, Common Stock or other securities that
entitle the holder to receive, directly or indirectly, Common Stock)
entitling any Person to acquire shares of Common Stock at a price
per share less than the Exercise Price (if the holder of the Common
Stock or Common Stock Equivalent so issued shall at any time,
whether by operation of purchase price adjustments, reset
provisions, floating conversion, exercise or exchange prices or
otherwise, or due to warrants, options or rights issued in
connection with such issuance, be entitled to receive shares of
Common Stock at a price less than the Exercise Price, such issuance
shall be deemed to have occurred for less than the Exercise Price),
then, the Exercise Price shall be reduced to equal such lower price.
Such adjustment shall be made whenever such Common Stock or Common
Stock Equivalents are issued. The Company shall notify the Holder in
writing, no later than the Trading Day following the issuance of any
Common Stock or Common Stock Equivalent subject to this section,
indicating therein the applicable issuance price, or of applicable
reset price, exchange price, conversion price and other pricing
terms.
(b) For purposes of this subsection 4(v), the following subsections
(v)(b)(l) to (v)(b)(3) shall also be applicable:
(1) Issuance of Rights or Options. In case at any time the
Company shall in any manner grant (directly and not by assumption in
a merger or otherwise) any warrants or other rights to subscribe for
or to purchase, or any options for the purchase of, Common Stock or
any stock or security convertible into or exchangeable for Common
Stock (such warrants, rights or options being called "Options" and
such convertible or exchangeable stock or securities being called
"Convertible Securities") whether or not such Options or the right
to convert or exchange any such Convertible Securities are
immediately exercisable, and the price per share for which Common
Stock is issuable upon the exercise of such Options or upon the
conversion or exchange of such Convertible Securities (determined by
dividing (i) the sum (which sum shall constitute the applicable
consideration) of (x) the total amount, if any, received or
receivable by the Company as consideration for the granting of such
Options, plus (y) the aggregate amount of additional consideration
payable to the Company upon the exercise of all such Options, plus
(z), in the case of such Options which relate to Convertible
Securities, the aggregate amount of additional consideration, if
any, payable upon the issue or sale of such Convertible Securities
and upon the conversion or exchange thereof, by (ii) the total
maximum number of shares of Common Stock issuable upon the exercise
of such Options or upon the conversion or exchange of all such
Convertible Securities issuable upon the exercise of such Options)
shall be less than the Exercise Price in effect immediately prior to
the time of the granting of such Options, then the total number of
shares of Common Stock issuable upon the exercise of such Options or
upon conversion or exchange of the total amount of such Convertible
Securities issuable upon the exercise of such Options shall be
deemed to have been issued for such price per share as of the date
of granting of such Options or the issuance of such Convertible
Securities and thereafter shall be deemed to be outstanding for
purposes of adjusting the Exercise Price. Except as otherwise
provided in subsection 4(v)(b)(3), no adjustment of the Exercise
Price shall be made upon the actual issue of such Common Stock or of
such Convertible Securities upon exercise of such Options or upon
the actual issue of such Common Stock upon conversion or exchange of
such Convertible Securities.
(2) Issuance of Convertible Securities. In case the Company
shall in any manner issue (directly and not by assumption in a
merger or otherwise) or sell any Convertible Securities, whether or
not the rights to exchange or convert any such Convertible
Securities are immediately exercisable, and the price per share for
which Common Stock is issuable upon such conversion or exchange
(determined by dividing (i) the sum (which sum shall constitute the
applicable consideration) of (x) the total amount received or
receivable by the Company as consideration for the issue or sale of
such Convertible Securities, plus (y) the aggregate amount of
additional consideration, if any, payable to the Company upon the
conversion or exchange thereof, by (ii) the total number of shares
of Common Stock issuable upon the conversion or exchange of all such
Convertible Securities) shall be less than the Exercise Price in
effect immediately prior to the time of such issue or sale, then the
total maximum number of shares of Common Stock issuable upon
conversion or exchange of all such Convertible Securities shall be
deemed to have been issued for such price per share as of the date
of the issue or sale of such Convertible Securities and thereafter
shall be deemed to be outstanding for purposes of adjusting the
Exercise Price, provided that (a) except as otherwise provided in
subsection 4(v)(b)(3), no adjustment of the Exercise Price shall be
made upon the actual issuance of such Common Stock upon conversion
or exchange of such Convertible Securities and (b) no further
adjustment of the Exercise Price shall be made by reason of the
issue or sale of Convertible Securities upon exercise of any Options
to purchase any such Convertible Securities for which adjustments of
the Exercise Price have been made pursuant to the other provisions
of subsection 4(v).
(3) Change in Option Price or Conversion Rate. Upon the
happening of any of the following events, namely, if the purchase
price provided for in any Option referred to in subsection
4(v)(b)(l) hereof, the additional consideration, if any, payable
upon the conversion or exchange of any Convertible Securities
referred to in subsections 4(v)(b)(l) or 4(v(b)(2), or the rate at
which Convertible Securities referred to in subsections 4(v)(b)(l)
or 4(v)(b)(2) are convertible into or exchangeable for Common Stock
shall change at any time (including, but not limited to, changes
under or by reason of provisions designed to protect against
dilution), the Exercise Price in effect at the time of such event
shall forthwith be readjusted to the Exercise Price which would have
been in effect at such time had such Options or Convertible
Securities still outstanding provided for such changed purchase
price, additional consideration or conversion rate, as the case may
be, at the time initially granted, issued or sold. On the
termination of any Option for which any adjustment was made pursuant
to this subsection 4(v) or any right to convert or exchange
Convertible Securities for which any adjustment was made pursuant to
this subsection 4(v) (including without limitation upon the
redemption or purchase for consideration of such Convertible
Securities by the Company), the Exercise Price then in effect
hereunder shall forthwith be changed to the Exercise Price which
would have been in effect at the time of such termination had such
Option or Convertible Securities, to the extent outstanding
immediately prior to such termination, never been issued.
(c) Notwithstanding the foregoing, no adjustment will be made under
this paragraph (v) in respect of: (1) the issuance of securities
upon the exercise or conversion of any Common Stock Equivalents
issued by the Company prior to the Original Issue Date of this
Warrant (but this subsection (v) will apply to any amendments,
modifications, and reissuances thereof and as a result of any
changes, resets or adjustments to a Conversion or Exchange Price
thereunder whether or not as a result of any amendment, modification
or reissuance), or (2) the grant of options or warrants, or the
issuance of additional securities, under any duly authorized Company
stock option, stock incentive plan, restricted stock plan or stock
purchase plan in existence on the Closing Date or thereafter
approved by the stockholders of the Company, or (3) shares of Common
Stock or Common Stock Equivalents issued to consultants, employees,
officers or directors of the Company, as compensation for their
services to the Company or any of its direct or indirect
Subsidiaries pursuant to arrangements approved by the Board of
Directors of the Company and consistent with past practice, or (4)
the issuance of the Securities pursuant to the Transaction Documents
(as defined in the Notes Purchase Agreement dated on or about the
date hereof), or (5) up to 250,000 shares of Common Stock or Common
Stock Equivalents issuable in connection with an equipment financing
by Vencore Solutions, LLC, or (6) the issuance of Common Stock to
Logisticorp, Inc., and Southwest Resource Preservation, Inc., or
their successors and assigns, based upon the issuance and conversion
of outstanding convertible debentures, with the issuance of said
Common Stock not to exceed 700,000 shares, or (7) shares of Common
Stock issued as consideration for the acquisition of another company
or business in which the shareholders of the Company do not have an
ownership interest, which acquisition has been approved by the Board
of Directors of the Company, or (8) pursuant to the Anti-Dilution
Entitlements and New Entitlements (each as defined in the Amendment
to Securities Purchase Agreement dated on or about the date hereof),
or (9) shares of Common Stock or Common Stock Equivalents issued in
connection with Strategic Transactions, which shall be defined as a
transaction or relationship in which the Company issues shares of
Common Stock or other securities of the Company to a Person which
is, itself or through its subsidiaries, an operating company in a
business synergistic with the business of the Company and in which
the Company receives benefits in addition to the investment of
funds, but shall not include a transaction in which the Company is
issuing securities primarily for the purpose of raising capital or
to an entity whose primary business is investing in securities.
Strategic Transaction includes bona fide equipment or real property
leases, sale and leaseback, or licensing agreements, provided that
such transaction is approved by the Board of Directors of the
company and is not for the purpose of raising capital.
(d) The adjustments that would arise under this paragraph (v) shall
only take effect from such time as the Company has obtained
stockholder approval; and if such stockholder approval is obtained,
then the adjustments that would have occurred under this paragraph
(v) for issuance prior to the date of such Stockholder approval
shall take effect as of the date of such stockholder approval. The
Company must use its best efforts to seek and obtain stockholder
approval as soon as possible following, and in any event within 90
days of, the date of issue of the relevant shares of Common Stock or
Common Stock Equivalents.
Whenever the Exercise Price shall be adjusted pursuant to this Section 4,
the Company shall issue a certificate signed by its President or Vice President
and by its Treasurer, Assistant Treasurer, Secretary or Assistant Secretary,
setting forth, in reasonable detail, the event requiring the adjustment, the
amount of the adjustment, the method by which such adjustment was calculated
(including a description of the basis on which the Board of Directors of the
Company made any determination hereunder), and the Exercise Price after giving
effect to such adjustment, and shall cause copies of such certificates to be
mailed (by first-class mail, postage prepaid) to the Holder of this Warrant. The
Company shall make such certificate and mail it to the Holder promptly after
each adjustment.
No fractional shares of Common Stock shall be issued in connection with
any exercise of this Warrant, but in lieu of such fractional shares, the Company
shall make a cash payment therefore equal in amount to the product of the
applicable fraction multiplied by the Exercise Price then in effect.
5. In the event the Company grants rights (other than rights granted
pursuant to a shareholder rights or poison pill plan) to all shareholders to
purchase Common Stock, the Holder shall have the same rights as if this Warrant
had been exercised immediately prior to such grant.
6. The shares of Common Stock issuable upon the exercise of this Warrant
shall have piggyback rights for inclusion in the next registration statement
filed by the Company with the Securities and Exchange Commission.
7. This Warrant need not be changed because of any change in the Exercise
Price or in the number of shares of Common Stock purchased hereunder.
8. The terms defined in this paragraph, whenever used in this Warrant,
shall, unless the context otherwise requires, have the respective meanings
hereinafter specified. The term "Common Stock" shall mean and include the
Company's Common Stock, $0.03 par value per share, authorized on the date of the
original issue of this Warrant and shall also include in case of any
reorganization, reclassification, consolidation, merger or sale of assets of the
character referred to in Section 4 hereof, the stock, securities or assets
provided for in such paragraph. The term "Company" shall also include any
successor corporation to Calypte Biomedical Corporation by merger, consolidation
or otherwise. The term "outstanding" when used with reference to Common Stock
shall mean at any date as of which the number of shares thereof is to be
determined, all issued shares of Common Stock, except shares then owned or held
by or for the account of the Company. The term "1933 Act" shall mean the
Securities Act of 1933, as amended, or any successor Federal statute, and the
rules and regulations of the Securities and Exchange Commission, or any other
Federal agency then administering the 1933 Act, there-under, all as the same
shall be in effect at the time.
9. This Warrant is exchangeable, upon the surrender hereby by the Holder
at the office or agency of the Company, for new Warrants of like tenor
representing in the aggregate the right to subscribe for and purchase the number
of shares of Common Stock which may be subscribed for and purchased hereunder,
each of such new Warrants to represent the right to subscribe for and purchase
such number of shares of Common Stock as shall be designated by the Holder at
the time of such surrender. Upon receipt of evidence satisfactory to the Company
of the loss, theft, destruction or mutilation of this Warrant or any such new
Warrants and, in the case of any such loss, theft, or destruction, upon delivery
of a bond of indemnity, reasonably satisfactory to the Company, or, in the case
of any such mutilation, upon surrender or cancellation of this Warrant or such
new Warrants, the Company will issue to the Holder a new Warrant of like tenor,
in lieu of this Warrant or such new Warrants, representing the right to
subscribe for and purchase the number of shares of Common Stock which may be
subscribed for and purchased hereunder.
10. The Company will at no time close its transfer books against the
transfer of this Warrant or of any shares of Common Stock issued or issuable
upon the exercise of this warrant in any manner which interferes with the timely
exercise of this Warrant. This Warrant shall not entitle the Holder to any
voting rights or any rights as a shareholder of the Company. The rights and
obligations of the Company, of the Holder, and of any holder of shares of Common
Stock issuable hereunder, shall survive the exercise of this Warrant.
11. This Warrant sets forth the entire agreement of the Company and the
Holder of the Common Stock issuable upon the exercise of this Warrant with
respect to the rights of the Holder and the Common Stock issuable upon the
exercise of this Warrant, notwithstanding the knowledge of such Holder of any
other agreement or the provisions of any agreement, whether or not known to the
Holder, and the Company represents that there are no agreements inconsistent
with the terms hereof or which purport in any way to bind the Holder of this
Warrant or the Common Stock.
12. The laws of the State of California shall govern the validity,
interpretation and performance of this Warrant and each of its terms and
provisions.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer.
CALYPTE BIOMEDICAL CORPORATION
By
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Executive Vice President & CFO
FORM OF ELECTION TO PURCHASE
(To be executed by the Holder to exercise the right to purchase shares of Common
Stock under the Warrant to which this form applies, issued by Calypte Biomedical
Corporation ("Calypte"))
To Calypte Biomedical Corporation:
The undersigned hereby irrevocably elects to purchase _____________ shares
of common stock, $0.03 par value per share, of Calypte (the "Common Stock") and,
encloses herewith $________ in cash, certified or official bank check or checks,
which sum represents the aggregate Exercise Price (as defined in the Warrant)
for the number of shares of Common Stock to which this Form of Election to
Purchase relates, together with any applicable taxes payable by the undersigned
pursuant to the Warrant.
The undersigned requests that certificates for the shares of Common Stock
issuable upon this exercise be issued in the name of
PLEASE INSERT SOCIAL SECURITY OR
TAX IDENTIFICATION NUMBER
-------------- -------------------------------------
--------------------------------------------------------------------------------
(Please print name and address)
Dated:______________,_____ Name of Holder:
(Print)
----------------------------
(By:)
----------------------------
(Name:)
(Title:)
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant)
FORM OF ASSIGNMENT
[To be completed and signed only upon transfer of Warrant]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ________________________________ the right represented by the within
Warrant to purchase ____________ shares of Common Stock of Calypte Biomedical
Corporation to which the within Warrant relates and appoints ________________
attorney to transfer said right on the books of Calypte Biomedical Corporation
with full power of substitution in the premises.
Dated:
---------------, ----
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(Signature must conform in all respects to name of
holder as specified on the face of the Warrant)
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Address of Transferee
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In the presence of:
--------------------------