Document:

exv10w2

Exhibit 10.2

[FORM OF NOTE]

THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR
OTHERWISE DISPOSED OF BY THE HOLDER EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS OF
ANY STATE WITH RESPECT THERETO OR IN ACCORDANCE WITH AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND ALSO MAY NOT
BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH ANY APPLICABLE RULES OF THE
SECURITIES AND EXCHANGE COMMISSION.

REGEN BIOLOGICS, INC.

8.00% Unsecured Convertible Note

			
	 	 	 
	No. S-____	 	 
	$________
	 	December 4, 2008

     REGEN BIOLOGICS, INC., a Delaware corporation (the “Company”), for value received,
hereby promises to pay to                                          or its registered assigns the principal sum of
$                     on July 24, 2009, and to pay interest (computed on the basis of a 360-day year of twelve
30-day months) on the unpaid principal balance hereof from the date of the Closing at the rate of
interest (the “Interest Rate”) specified below.

     1. Interest hereon shall accrue at a rate of 8.00% per annum commencing on the date of the
Closing and shall be payable, in arrears, on the Maturity Date.

     2. Payments of principal, interest and all other amounts due in respect hereof shall be made
in immediately available U.S. Dollars at the address shown in the Register maintained by the
Company for such purpose, in the manner provided in the Subscription Agreement.

     3. This Note is one of an issue of 8.00% Unsecured Convertible Notes of the Company issued in
an aggregate principal amount of not more than $500,000, pursuant to the Subscription Agreement (as
may be amended, amended and restated, restated or otherwise modified from time to time, the
“Subscription Agreement”), dated as of December 4, 2008, among the Company and the original
signatories thereto. The holder of this Note is entitled to the benefits of the Subscription
Agreement. This Note is subject to the terms of the Subscription Agreement, and such terms are
incorporated herein by reference. Capitalized terms used herein and not defined herein have the
meanings specified in the Subscription Agreement.

     4. This Note shall be convertible into shares of Common Stock of the Company on the terms and
conditions set forth in the Subscription Agreement.

     5. This Note shall not confer any preemptive rights to its Holder; provided,
however, that this Note shall have no effect on any existing preemptive rights held by its
Holder.

 

 

     6. The Subscription Agreement contains provisions permitting the Issuer and the Holders of not
less than a majority in aggregate principal amount of the Notes at the time outstanding, to execute
amendments adding any provisions to or changing in any manner or eliminating any of the provisions
of the Subscription Agreement or modifying in any manner the rights of the Holders of the Notes,
subject to any exceptions set forth in the Subscription Agreement.

     7. The Notes are issuable in fully registered form, without coupons, at the office or agency
of the Issuer, and in the manner and subject to the limitations provided in the Subscription
Agreement. Notes may be exchanged for a like aggregate principal amount of Notes of any other
authorized denominations.

     8. This Note is transferable only as specified in the Subscription Agreement, duly endorsed or
accompanied by a written instrument of transfer duly executed by the holder of this Note or its
attorney duly authorized in writing.

     9. THIS NOTE AND THE SUBSCRIPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY CONFLICTS OF
LAW RULES THAT WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.

	 	 	 	 	 
	 	REGEN BIOLOGICS, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Brion D. Umidi 	 
	 	 	Title:  	Senior Vice President and

Chief Financial Officer 	 

 

 

	 	 	 	 	 

CONVERSION NOTICE

TO: REGEN BIOLOGICS, INC.

     The undersigned registered owner of this Note hereby irrevocably exercises the option to
convert this Note, or the portion thereof below designated, into shares of Common Stock in
accordance with the terms of the Subscription Agreement referred to in this Note, and directs that
the shares of Common Stock, together with any check in payment for cash, if any, payable upon
exchange or for fractional shares and any Notes representing any unconverted principal amount
hereof, be issued and delivered to the registered holder hereof unless a different name has been
indicated below. Capitalized terms used herein but not defined shall have the meanings ascribed to
such terms in the Subscription Agreement. If shares or any portion of this Note not converted are
to be issued in the name of a person other than the undersigned, the undersigned will provide the
appropriate information below and pay all transfer taxes payable with respect thereto.

	 	 	 
	Dated:                                                 

	 	Note No: S-___

	 	 	 	 	 
	 	Registered Holder:

 	 
	 	
 	 
	 	 	 
	 	
 	 
	 	Signature(s) 	 
	 	 	 
	 	Signature(s) must be guaranteed by an “eligible guarantor
institution” meeting the requirements of the Security
Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion
Program (“STAMP”) or such other “signature guarantee program”
as may be determined by the Security Registrar in addition
to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended. 	 
	 	 	 
	 	
 	 
	 	Signature Guarantee 	 
	 	 	 

 

 

	 	 	 	 	 

     Fill in the registration of shares of Common Stock, if to be issued, and Notes, if to be
delivered, and the person to whom cash and payment for fractional shares is to be made, if to be
made, other than to and in the name of the registered holder:

Please print name and address

(Name)

(Street Address)

(City, State and Zip Code)

Principal amount to be converted

(if less than all):

$ 

Social Security or Other Taxpayer

Identification Number:

 

NOTICE: The signature on this Conversion Notice must correspond with the name as written upon the
face of the Note in every particular without alteration or enlargement or any change whatever.exv10w3

Exhibit 10.3

THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR
OTHERWISE DISPOSED OF BY THE HOLDER EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS OF
ANY STATE WITH RESPECT THERETO OR IN ACCORDANCE WITH AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND ALSO MAY NOT
BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH ANY APPLICABLE RULES OF THE
SECURITIES AND EXCHANGE COMMISSION.

           Warrants

REGEN BIOLOGICS, INC.

WARRANT CERTIFICATE

Warrant to Purchase

Common Stock

Date of Issue: December 4, 2008

          This warrant certificate (“Warrant Certificate”) certifies that for value received
                               or registered assigns (the “Holder”) is the owner of the warrant
specified above (the “Warrant”), which entitles the Holder thereof to purchase, at any time on or
before the Expiration Date (hereinafter defined) up to                 fully paid and nonassessable
shares of Common Stock, $0.01 par value (“Common Stock”), of ReGen Biologics, Inc., a Delaware
corporation (the “Company”), at the Exercise Price (as defined herein).

 

 

     1. Warrant; Exercise Price

     This Warrant shall entitle the Holder to purchase up to (i)            shares of Common Stock
of the Company and the purchase price payable upon exercise of the Warrants shall initially be
$0.20 per share of Common Stock, subject to adjustment as hereinafter provided (as may be adjusted
from time to time, the “Exercise Price”). The Exercise Price and number of shares of Common Stock
issuable upon exercise of this Warrant are subject to adjustment as provided in Section 6.

     2. Exercise; Expiration Date

     2.1 This Warrant is exercisable, at the option of the Holder, at any time or times
after issuance and on or before the Expiration Date (as hereinafter defined), upon surrender
of this Warrant Certificate to the Company together with a duly completed Notice of
Exercise, in the form attached hereto as Exhibit A, and payment of an amount equal
to the product of the Exercise Price times the number of shares of Common Stock to be
acquired. Payment of the Exercise Price for the Warrant Shares (as hereinafter defined)
shall be in lawful money of the United States of America, paid by wired transfer or
cashier’s check drawn on a United States bank or pursuant to the terms of Section 9. In the
case of exercise of the Warrant for less than all the Warrant Shares (as hereinafter
defined) represented by this Warrant Certificate, the Company shall cancel the Warrant
Certificate upon the surrender thereof and shall execute and deliver a new Warrant
Certificate for the balance of such Warrant Shares (as hereinafter defined).

     2.2 The term “Expiration Date” shall mean 5:00 p.m. New York time on December 4, 2013
or if such date shall in the State of New York be a holiday or a day on which banks are
authorized to close, then 5:00 p.m. New York time the next following date which in the State
of New York is not a holiday or a day on which banks are authorized to close.

     3. Registration and Transfer on Company Books

     3.1 The Company shall maintain books for the registration and transfer of the Warrants
and the registration and transfer of the shares of Preferred Stock or, after the Mandatory
Conversion, Common Stock, issued upon exercise of the Warrants.

     3.2 Prior to due presentment for registration of transfer of this Warrant Certificate,
or the shares of Preferred Stock or, after the Mandatory Conversion, Common Stock, issued
upon exercise of the Warrants, the Company may deem and treat the registered Holder as the
absolute owner thereof.

     3.3 Neither this Warrant nor the shares of Preferred Stock or, after the Mandatory
Conversion, Common Stock, issuable upon exercise hereof (the “Warrant Shares”) have been
registered under the Securities Act of 1933, as amended (the “Act”). The Company will not
transfer this Warrant or issue or transfer the Warrant Shares unless (i) there is an
effective registration covering such Warrant or Warrant Shares, as the case

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may be, under the Act and applicable states securities laws, (ii) it first receives a
letter from an attorney, acceptable to the Company’s board of directors or its agents,
stating that in the opinion of the attorney the proposed issue or transfer is exempt from
registration under the Act and under all applicable state securities laws, or (iii) the
transfer is made pursuant to Rule 144 under the Act. Subject to the foregoing, this Warrant
Certificate, the Warrant represented hereby, and the Warrant Shares, may be sold, assigned
or otherwise transferred voluntarily by the Holder to officers or directors of the Holder,
to members of such persons’ immediate families, or to the Holder’s parent or subsidiary
corporations. The Company shall register upon its books any permitted transfer of a Warrant
Certificate, upon surrender of same to the Company with a written instrument of transfer
duly executed by the registered Holder or by a duly authorized attorney. Upon any such
registration of transfer, new Warrant Certificate(s) shall be issued to the transferee(s)
and the surrendered Warrant Certificate shall be canceled by the Company. A Warrant
Certificate may also be exchanged, at the option of the Holder, for new Warrant Certificates
representing in the aggregate the number of Warrant Shares evidenced by the Warrant
Certificate surrendered.

     4. Reservation of Shares

     The Company covenants that it will at all times reserve and keep available out of its
authorized Common Stock, solely for the purpose of issue upon exercise of the Warrant, such number
of shares of Common Stock as shall then be issuable upon the exercise of the entire Warrant. The
Company covenants that all Warrant Shares shall be duly and validly issued and, upon payment for
such shares as set forth herein, fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issue thereof, and that upon issuance such shares shall be listed on
the national securities exchange, if any, on which the other shares of outstanding Common Stock of
the Company are then listed.

     5. Loss or Mutilation

     Upon receipt by the Company of reasonable evidence of the ownership of and the loss, theft,
destruction or mutilation of any Warrant Certificate and, in the case of loss, theft or
destruction, of indemnity reasonably satisfactory to the Company, or, in the case of mutilation,
upon surrender and cancellation of the mutilated Warrant Certificate, the Company shall execute and
deliver in lieu thereof a new Warrant Certificate representing the number of Warrant Shares
evidenced by the lost, stolen, destroyed or mutilated Warrant Certificate.

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     6. Adjustments of Exercise Price and Shares

     6.1 In the event of changes in the outstanding Common Stock of the Company by reason of
dividends, distributions, split-ups, recapitalizations, reclassifications, combinations or
exchanges of shares, separations, reorganizations, liquidations, consolidation, acquisition
of the Company (whether through merger or acquisition of substantially all the assets or
stock of the Company), or the like, the number and class of shares available under the
Warrant in the aggregate and the Exercise Price shall be correspondingly adjusted to give
the Holder of the Warrant, on exercise for the same aggregate Exercise Price, the total
number, class, and kind of shares or other property as the Holder would have owned had the
Warrant been exercised prior to the event and had the Holder continued to hold such shares
until the event requiring adjustment. The form of this Warrant need not be changed because
of any adjustment in the number of Warrant Shares subject to this Warrant or the Exercise
Price provided herein.

     6.2 If at any time or from time to time the holders of all of the shares of Common
Stock of the Company (or the holders of all of the shares of stock or other securities at
the time receivable upon the exercise of this Warrant) shall, as a class, have received or
become entitled to receive, without payment therefor:

	 	(i)	 	Common Stock or any shares of stock or other
securities which are at any time directly or indirectly convertible
into or exchangeable for Common Stock, or any rights or options to
subscribe for, purchase or otherwise acquire any of the foregoing by
way of dividend or other distribution (other than a dividend or
distribution covered in Section 6.1 above),
	 
	 	(ii)	 	any cash paid or payable; or
	 
	 	(iii)	 	Common Stock or additional stock or other
securities or property (including cash) by way of spinoff, split-up,
reclassification, combination of shares or similar corporate
rearrangement (other than shares of Common Stock pursuant to Section
6.1 above),

then, and in each such case, the Holder hereof will, upon the exercise of this Warrant, be
entitled to receive, in addition to the number of shares of Common Stock receivable
thereupon, and without payment of any additional consideration therefor, the amount of stock
and other securities and property (including cash in the cases referred to in clauses (ii)
and (iii) above) which such Holder would hold on the date of such exercise had he or she
been the holder of record of such Common Stock as of the date on which holders of Common
Stock received or became entitled to receive such shares or all other additional stock and
other securities and property.

     6.3 Whenever the number of Warrant Shares purchasable upon the exercise of the Warrant
or the Exercise Price of such Warrant Shares is adjusted, as herein provided, the Company
shall mail to the Holder, at the address of the Holder shown on the books of

4

 

the Company, a notice of such adjustment or adjustments, prepared and signed by the
Chief Financial Officer or Secretary of the Company, which sets forth the number of Warrant
Shares purchasable upon the exercise of each Warrant and the Exercise Price of such Warrant
Shares after such adjustment, a brief statement of the facts requiring such adjustment and
the computation by which such adjustment was made.

     7. Conversion 

     7.1 In lieu of exercise of any portion of the Warrant as provided in Section 2.1
hereof, the Warrants represented by this Warrant Certificate (or any portion thereof) may,
at the election of the Holder, be converted into the nearest whole number of shares of
Common Stock equal to: (1) the product of (a) the number of Warrants to be so converted,
(b) the number of shares of Common Stock then issuable upon the exercise of each Warrant and
(c) the excess, if any, of (i) the Common Stock Market Price Per Share (as determined
pursuant to Section 8.2) with respect to the date of conversion minus (ii) the
Exercise Price in effect on the business day next preceding the date of conversion,
divided by (2) the Common Stock Market Price Per Share with respect to the date of
conversion.

     7.2 The conversion rights provided under this Section 7 may be exercised in whole or in
part and at any time and from time to time while any Warrants remain outstanding. In order
to exercise the conversion privilege, the Holder shall surrender to the Company, at its
offices, this Warrant Certificate accompanied by a duly completed Notice of Conversion in
the form attached hereto as Exhibit B. The Warrants (or so many thereof as shall
have been surrendered for conversion) shall be deemed to have been converted immediately
prior to the close of business on the day of surrender of such Warrant Certificate for
conversion in accordance with the foregoing provisions. As promptly as practicable on or
after the conversion date, the Company shall issue and shall deliver to the Holder (i) a
certificate or certificates representing the number of shares of Common Stock to which the
Holder shall be entitled as a result of the conversion, and (ii) if the Warrant Certificate
is being converted in part only, a new certificate in principal amount equal to the
unconverted portion of the Warrant Certificate.

     8. Fractional Shares and Warrants; Determination of Market Price Per Share

     8.1 Anything contained herein to the contrary notwithstanding, the Company shall not be
required to issue any fraction of a share of Common Stock in connection with the exercise of
Warrants. Warrants may not be exercised in such number as would result (except for the
provisions of this paragraph) in the issuance of a fraction of a share of Common Stock
unless the Holder is exercising the entire Warrant then owned by the Holder. In such event,
the Company shall, upon the exercise of the Warrant, issue to the Holder the largest
aggregate whole number of shares of Common Stock called for thereby upon receipt of the
Exercise Price for the entire Warrant and pay a sum in cash equal to the remaining fraction
of a share of Common Stock multiplied by the Common Stock Market Price Per Share (as
determined pursuant to Section 8.2 below) as of the last business day preceding the date on
which the Warrants are presented for exercise.

5

 

     8.2 As used herein, the “Common Stock Market Price Per Share” with respect to any date
shall mean the average closing price per share of Company’s Common Stock for the ten (10)
trading days immediately preceding such date during which the Common Stock has traded. The
closing price for each such day shall be the closing sale price or, in case no such sale
takes place on such day, the closing price on the last trading day, in either case on the
principal securities exchange on which the shares of Common Stock of the Company are listed
or admitted to trading, the last sale price, or in case no sale takes place on any such day,
the average of the high and low sales prices of the Common Stock on the Over-the-Counter
Bulletin Board (“OTCBB”) or any comparable system, or if the Common Stock is not reported on
OTCBB, or a comparable system, the average of the closing bid and asked prices as furnished
by two members of the National Association of Securities Dealers, Inc. selected from time to
time by the Company for that purpose. If such bid and asked prices are not available, then
“Common Stock Market Price Per Share” shall be equal to the fair market value of the
Company’s Common Stock as determined in good faith by the board of directors of the Company.

     9. Notices

     All notices, requests, demands, claims, and other communications hereunder shall be in writing
and shall be delivered by certified or registered mail (first class postage pre-paid), guaranteed
overnight delivery, or facsimile transmission if such transmission is confirmed by delivery by
certified or registered mail (first class postage pre-paid) or guaranteed overnight delivery, to
the following addresses and telecopy numbers (or to such other addresses or telecopy numbers which
such party shall subsequently designate in writing to the other party):

if to the Company to:

ReGen Biologics, Inc.

411 Hackensack Avenue

Hackensack, NJ 07601

Attention: Brion D. Umidi

Telecopy: 201.651.5141

with a copy to:

Pillsbury Winthrop Shaw Pittman LLP

1650 Tysons Boulevard

McLean, VA 22102

Attention: David C. Main, Esq.

Telecopy: 703.770.7901

if to the Holder to the address set forth on the books of the Company.

     Each such notice or other communication shall for all purposes of this Agreement be treated as
effective or having been given when delivered if delivered by hand, by messenger or by courier, or
if sent by facsimile, upon confirmation of receipt.

6

 

     10. Governing Law

          This Warrant Certificate shall be governed by and construed in accordance with the laws of the
State of New York.

7

 

     IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed as of
the date first above written.

	 	 	 	 	 
	REGEN BIOLOGICS, INC.

 	 
	By:  	 	 
	 	Name:  	Brion D. Umidi 	 
	 	Title:  	Senior Vice President and

Chief Financial Officer 	 
	 

Attest:

                                                            

8

 

EXHIBIT A

NOTICE OF EXERCISE

	 	 	 	 	 
	To:

	 	ReGen Biologics, Inc.
	 	 
	 

	 	411 Hackensack Avenue
	 	                    , 20       
	 

	 	Hackensack, NJ 07601
	 	 

     The undersigned hereby irrevocably elects to purchase, pursuant to Section 2 of the Warrant
Certificate accompanying this Notice of Exercise,            Warrant Shares of the total number of
Warrant Shares issuable to the undersigned pursuant to the accompanying Warrant Certificate, and
herewith makes payment of $                        in payment in full of the aggregate Exercise Price of such
shares.

     Please issue a certificate or certificates representing said Warrant Shares in the name of the
undersigned or in such other name as is specified below:

                                                                 

     The Warrant Shares shall be delivered to the following:

                                                                 

                                                                 

                                                                 

	 	 	 
	 

Name of Holder

	 	 
	 
	 	 
	 
	 	 
	 

Signature
	 	 
	 
	 	 
	Address:
	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 
	 	 
	 

	 	 

 

 

EXHIBIT B

NOTICE OF CONVERSION

	 	 	 	 	 
	To:

	 	ReGen Biologics, Inc.
	 	 
	 

	 	411 Hackensack Avenue
	 	                    , 20       
	 

	 	Hackensack, NJ 07601
	 	 

     The undersigned hereby irrevocably elects to convert, pursuant to Section 7 of the Warrant
Certificate accompanying this Notice of Conversion,            Warrant Shares of the total number of
Warrant Shares issuable to the undersigned pursuant to the accompanying Warrant Certificate into
shares of the Common Stock of the Company (the “Shares”).

     The number of Shares to be received by the undersigned, calculated in accordance with the
provisions of Section 7.1 of the accompanying Warrant Certificate, is                     .

                                                                 

     Please issue a certificate or certificates representing said Warrant Shares in the name of the
undersigned or in such other name as is specified below:

                                                                 

     The Warrant Shares shall be delivered to the following:

                                                                 

                                                                 

                                                                 

	 	 	 
	 

Name of Holder

	 	 
	 
	 	 
	 
	 	 
	 

Signature
	 	 
	 
	 	 
	Address:

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